STATUS OF IMPLEMENTATION OF PRIOR YEAR’S

AUDIT RECOMMENDATIONS

Of the 26 recommendations embodied in the CY 2019 AAR, 22 were

implemented and 4 were not implemented.

Reference
Observations and Action Taken by Result of Auditor’s
2019AAR
Recommendations Management Validation
(PageNo.)
1. Of the ₱6,117,081.64 29
inventory expenses,
₱4,939,019.25 common-use
office supplies, accountable
forms and other supplies and
materials procured during the
year for distribution were
treated as outright expenses
instead of coursing through
the inventory accounts
contrary to Section 9,
Chapter 8, Volume I of the
GAM.

We recommended and
Management agreed to
require the:

a. concerned Offices and PPMPs are directly Implemented

divisions to prepare and submitted to The Audit Team
submit their PPMP to the Procurement Unit or verified that common
Supply and Property Unit Bids and Awards supplies were
for consolidation and their Committee (BAC) consolidated for
quarterly inventory Secretariat for procurement in PS-
requirements for timely consolidation to APP. DBM, while other
procurement; This included other supplies like meals and
supplies and materials cell card load
that were not readily allowance were
available in Procurement consolidated for bulk
Service and not part of procurement.
common supply.

b. Management to procure Supplies needed were Implemented

goods in bulk based on consolidated and Post-audit of
the Annual Procurement included in the APP for disbursement showed

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 Reference
Observations and Action Taken by Result of Auditor’s
2019AAR
Recommendations Management Validation
(PageNo.)
Plan (APP) following the proper procurement. that Management
modes of procurement procured supplies based
under RA 9184; on the APP and in
accordance with RA
No. 9184

c. Property Officer to issue Informed property Implemented

supplies and materials Officer to issue supplies Supplies were not
requirement enough for a and materials issued for a month
month to three-month; requirements enough for requirement
a month or three-month.

d. Accountant and Supply Accountant and Supply Implemented

Officer to maintain the Officer maintained The Accountant and
required Supplies Ledger Supply Ledger Card and Supply Officer are now
and stock cards for the Stock Card. maintaining Supplies
procured goods and cost Ledger and stock cards.
the issuances and items on
hand using the perpetual
inventory method to
ensure proper accounting
and better control in the
recognition/recording of
inventories on hand and
corresponding expenses;
and

e. Requesting Units/ Informed all divisions Implemented

Division may procure and offices to procure Audit of petty cash
supplies and materials in minimal value of replenishment showed
small quantities charged supplies to Petty Cash that procurement of
to the Petty Cash Fund Voucher (PCV) supplies and materials
(PCF) maintained by the for emergency purposes
Office for emergency were charged to PCF.
purposes and maybe
charge as an outright
expense.

2. There were control 32

lapses in the handling/
safekeeping of the
accountabilities of the
Special Disbursement Offices
(SDOs) such non-

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 Reference
Observations and Action Taken by Result of Auditor’s
2019AAR
Recommendations Management Validation
(PageNo.)
maintenance of cashbook/
check disbursement register
(CDR) by the SDOs, cash
advances granted not in the
custody of the SDOs, and
absence of vault or safe
cabinets where the
accountabilities are to be
kept. These practices were
not in keeping with sections
of PD 1445 and GAM
besides the possibility of loss
or misappropriation.

We recommended and
Management agreed to:

a. require the SDOs to Management informed Implemented

maintain the required the SDOs to maintain All designated SDOs
records or their equivalent cashbook/CDR through maintained
for easy reference, issuance of Office cashbook/cash
facilitate verification and Memorandum. disbursing record for
reconciliation. their cash advances in
CY 2020.

b. require the Accountant to Management issued Implemented

orient the newly Office Memorandum Management furnished
designated SDOs of their No. 004-2019 dated the Audit Team a copy
duties and responsibilities, November 11, 2019 on of the Office
rules and regulations the guidelines on Memorandum issued to
concerning the handling of granting, utilization and officials and
cash advances and other liquidation of cash employees.
matters related to their advances of accountable
work before discharging officers.
their duties;

c. advise the SDOs to refrain Management informed Implemented

from transferring their the SDOs to refrain from The Audit Team
cash advances to another transferring their cash verified the compliance
personnel; and advances to another of SDO on non-
personnel through transferring of their
issuance of Office cash advances to other
Memorandum. personnel thru post-
audit of liquidation of

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 Reference
Observations and Action Taken by Result of Auditor’s
2019AAR
Recommendations Management Validation
(PageNo.)
cash advances in the
ensuing year and found
implemented.

d. study the possibility of Management allowed Implemented

establishing a single cash SDOs to continue to Management had
advance for all activities to perform disbursing cash assessed the possibility
be handled by the Cashier, advance with the of a single cash
from which PCFs are to be assistance of Admin advance but found it
granted to SDOs (for every staff. not feasible due to lack
division/unit) for special of manpower and
purpose activities; and simultaneous activities.

e. provide the SDOs with The SDOs were Implemented

safety box/vault for the provided with safety The Management
safekeeping of their box/vault. issued steel filing
accountabilities. cabinets with vault to
each office/division/
SDO.
3. There were over- 34
estimations in granting cash
advances to the SDOs that
resulted in the refund of
₱392,607.67 or 32.75 percent
out of the ₱1,198,650.00 cash
advances granted; thus, non-
maximization of the cash
allocation received.

We recommended and
Management agreed to:

a. consider the added Management has issued Implemented

responsibilities of Office Memorandum Management furnished
handling cash advances by No. 004-2019 dated the Audit Team copy of
the designated officers and November 11, 2019 on the Office
employees and their the guidelines on Memorandum issued to
available time to be granting, utilization and officials and
present in the activities liquidation of cash employees.
outside the office; advances of accountable
officers.

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 Reference
Observations and Action Taken by Result of Auditor’s
2019AAR
Recommendations Management Validation
(PageNo.)
b. require end-users/ All procured supplies Implemented
requesting units of and materials are Verification of supplies
supplies and materials, included in the APP for procurement for CY
food in bulk and bulk procurement. 2020 showed that these
communication supplies were included in the
to include the activity APP.
needs in the PPMP for
consolidation to the APP;

c. require the PO/BAC Reviewed and Implemented

Secretariat to (i) remind consolidated the PPMPs PPMPs are now
end-users/requesting units during BAC Meetings; consolidated
of their responsibilities to and
submit a PPMP;
(ii) consolidate the
PPMPs; and
(iii) recommend the mode
of procurement for the
contents of the APP; and

d. require the program/ Management minimized Implemented

activity in-charge to the amount of cash Audit of the report of
prepare a realistic budget advance granted by disbursement,
as basis of the cash requiring the Disbursing liquidation reports and
advance to avoid/minimize Officers to provide other related documents
refund of cash advances. canvass before drawing showed that minimal
the cash advances. amount of refunds of
cash advances were
made during the year.

4. There were 24 38
participations of NYC
officials and employees in
conventions, seminars,
conferences, symposia and
similar non-training
gatherings conducted/ by
non-government
organizations or private
institutions, costing a total of
₱176,500.00 that had
exceeded the ₱2,000.00
allowable limit per day for
each participant or a total of

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 Reference
Observations and Action Taken by Result of Auditor’s
2019AAR
Recommendations Management Validation
(PageNo.)
₱56,500.00 contrary to NBC
No. 563. Likewise, there was
no structured selection of
officials/employees for
training as evidenced by the
inclusion of those
resigning/retiring/frequent
absentees among the
participants; thus, expenses
incurred were government
losses because the knowledge
gained therefrom can no
longer be availed by the
government.

We recommended and
Management agreed to:

a. establish an internal Management drafted Not Implemented

policy on the guidelines on the As of date, the
prioritization/need of the standardization of approved Office
employees for outside allocation of funds for Memorandum was not
trainings seminars, trainings, workshops, yet submitted to the
conferences, symposia seminars or similar/ Audit Team.
and similar non-training analogous activities
activities with the end of organized and conducted This recommendation
developing the manpower by NYC; and was followed-up during
resources of the agency; the exit conference
and with the Management.
Management
committed to submit
the guidelines once
finalized and signed.

This was not

Reiterated, but will be
Closed upon
submission by
Management of the
drafted guidelines.

b. for future undertakings, Management prioritized Implemented

ensure strict compliance trainings conducted by For CY 2020, there
with the allowable limit of government were no training

48
 Reference
Observations and Action Taken by Result of Auditor’s
2019AAR
Recommendations Management Validation
(PageNo.)
₱2,000.00 per day for organizations. conducted/sponsored
each participant of by non-government
training fees for those organizations or private
conducted/sponsored by institution.
non-government Management
organizations or private participated in seminars
institutions. conducted by the CSC.

5. Expenses totaling 41
₱1,483,680.00 and pertaining
to (a) procurement of
Filipiniana costume;
(b) payment of food, venue
and accommodation during
the conduct of Pre-Departure
training; and (c) inclusion of
extra packs of meals in the
amount of ₱250.00 per day
for 17 NYC employees even
on Saturdays and Sundays
when there were no listed
activities for the day were not
in accordance with a) Section
17 and 48 of the General
Provisions of the GAA of CY
2019; b) Section 2 of
PDNo.1445; and c) COA
Circular No. 2012-003 dated
October 29, 2012, thus,
casting doubts on the
propriety, validity and
correctness of the
expenditures.

We recommended that
Management:

a. require the 23 officers/ Management had Implemented

employees to refund the deducted the excess This observation was
excess amount of payment on Filipiniana issued Notice of
₱1,930.00 each. For costume from the Mid- Disallowance No.
future expenses, limit the year bonus of the 2020-001-101(19). Of
amount based on what is concerned officials and the ₱96,500.00
allowable by law; employees; and disallowed amount,

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 Reference
Observations and Action Taken by Result of Auditor’s
2019AAR
Recommendations Management Validation
(PageNo.)
only ₱36,670.00 were
settled/refunded.

Settlement was
followed-up during the
exit conference with
the Management.
Management
committed to comply.

b. prioritize and maximize Due to COVID-19 Implemented

the use of government pandemic, Management Recommendation
facilities in the conduct of conducted their pertains to programs,
trainings and identify trainings/ programs projects and/or
members of the online. activities that need
Secretariat who can be on physical gatherings, but
a non-residential (live- due to the COVID-19
out) basis; and pandemic, all the
scheduled activities
were canceled; hence,
the Audit Team could
not validate. Validation
is deferred to CY 2021
audit or when
permitted.

c. ensure that Office Orders Due to COVID-19 Implemented

issued clearly define the pandemic, the Recommendation
roles of participants in Management conducted pertains to programs,
every activity. their trainings/programs projects and/or
online. activities that need
physical gatherings, but
due to the COVID-19
pandemic, all the
scheduled activities
were canceled; hence,
the Audit Team could
not validate. Validation
is deferred to CY 2021
audit or when
permitted.

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 Reference
Observations and Action Taken by Result of Auditor’s
2019AAR
Recommendations Management Validation
(PageNo.)

6. The NYC could have 44

reduced its training expenses
of ₱34,980,312.87 by
₱3,691,950.00 had it limited
room reservations to the
expected number of
attendees, held some of the
activities within the office
premises, and made use of
government/DOT accredited
facilities.

We recommended and
Management agreed that:

a. support the disbursements Management provided Implemented

with explanation/reason justification on the The Management
for- incurrence of excess submitted the
reserved hotel rooms justification to the
 the incurrence of excess and the necessity of Audit Team.
reserved hotel rooms conducting trainings/
and on an in-house basis seminars/workshop and
and most participants meetings in hotels
are residents in the outside Metro Manila.
place where the training
programs/seminar/work
shop were conducted;

 necessity of conducting
trainings/seminars/work
shop and meetings in
five-star hotels/resorts;
and use of single-room
occupancies for
employees/ JOs/COS
during the training
activities

b. submits policies/ Management drafted Not Implemented

guidelines on the guidelines on the As of date, the
maximum allowable fund standardization of approved Office
allocation per participant allocation of funds for Memorandum or
as basis for budgeting and trainings, workshops, guidelines was not yet

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 Reference
Observations and Action Taken by Result of Auditor’s
2019AAR
Recommendations Management Validation
(PageNo.)
control; seminars, or similar/ submitted to the Audit
analogous activities Team.
organized and conducted
by NYC.
This recommendation
was followed-up during
the exit conference
with the Management.
Management
committed to submit
the guidelines once
finalized and signed.

Reiteration is deferred
to CY 2021 audit or
when warranted.

c. issue an Office Order with Management drafted Not Implemented

a well-defined chore/role guidelines on the As of date, the
in every training standardization of approved Office
programs/ seminar/ allocation of funds for Memorandum is yet to
workshop to minimized trainings, workshops, be submitted by the
expenses, and ensure that seminars or similar/ Management.
roles/ responsibilities in analogous activities
the programs are clearly organized and conducted This recommendation
defined in the office by NYC. was followed-up during
orders that would be the exit conference
issued to the concerned with the Management.
employees; and Management
committed to submit
the guidelines once
finalized and signed.

Reiteration is deferred
to CY 2021 audit or
when warranted.

d. use the rates in EO No. 77 Management drafted Not Implemented

as basis for budgeting the guidelines on the Recommendation
accommodation of standardization of pertains to programs,
officers/employees/ allocation of funds for projects, and activities

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 Reference
Observations and Action Taken by Result of Auditor’s
2019AAR
Recommendations Management Validation
(PageNo.)
JOs/COs in-charge of in- trainings, workshops, that need physical
house trainings. seminars or similar/ gatherings, but due to
analogous activities the COVID-19
organized and conducted pandemic, all the
by NYC. scheduled activities
were canceled; hence,
the Audit Team could
not validate.

This recommendation
was followed-up during
the exit conference
with the Management.
Management
committed to submit
the guidelines once
finalized and signed.

Reiteration is deferred
to CY 2021 audit or
when warranted.
7. The objective of 46
NYC to encourage healthy
lifestyle amongst youth
through its Program Fit
Filipino Youth Against Drug
(FYAD) and Human
Immunodeficiency
Virus/Acquired
Immunodeficiency Syndrome
Prevention Program for the
Youth (Project HAPPY) was
not fully attained due to the
accomplishment of only four
out of the twelve targeted
activities but had incurred
₱9,332,965.41 or 89.69
percent of the total budget of
₱10,405,000.00.

We recommended that the Management provided Implemented

Planning Officer support the justification for the non- The Management
project disbursements/ accomplishment of each submitted the

53
 Reference
Observations and Action Taken by Result of Auditor’s
2019AAR
Recommendations Management Validation
(PageNo.)
liquidation/ terminal reports target for Project justification to the
with list of activities that HAPPY and the list of Audit Team.
were prioritized by the new prioritized activities by
administration in lieu of the the new administration
targeted activities indicating among the targeted
therewith budget per activity activities.
and reason/s for the non-
accomplishment of each
target.

8. NYC had not 55

allocated fund and
formulated any specific
plans, program and activities
that would address the
concerns of Senior Citizens
(SCs) and Persons with
Disability (PWDs) as
required under Section 33 of
the General Provisions of the
GAA for FY 2019.

We reiterated our prior year As of date, formulated Implemented

recommendation that plan of activities for SCs Plans, programs and
Management instruct all the and PWD was not yet activities intended for
concerned officials to approved. Senior Citizen and
allocate funds and formulate Persons with Disability
plans, programs and projects were submitted to the
intended for SCs and PWDs Audit Team.
to address their concerns and
integrate the same in their
regular activities as required
in the abovementioned rules
and regulation before any
activity is undertaken.

9. Procurement through 64
PCF, CA, reimbursement,
and from direct supplier were
not compliant with R.A. No.
9184 and its Revised IRR.

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 Reference
Observations and Action Taken by Result of Auditor’s
2019AAR
Recommendations Management Validation
(PageNo.)

We recommended that Management minimized Implemented

Management ensure that all the drawing of cash The Audit Team
procurements strictly comply advance, and strictly verified various
with the provisions of RA complied with the procurements of the
No. 9184 and its IRR. provisions of RA No. Agency and found
9184 and its provisions. these procurements
compliant with RA
9184 and its IRR
provisions.

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