COA Uncovers Bacoor LGU’s P51 Million Unsettled Cash Advances

Government auditors uncovered whopping lapses in the cash advance management of the Bacoor City Government for 2023, including P51.28 million in unliquidated funds by year-end and violations of national treasury rules, exposing public money to potential misuse.

In its 2024 annual audit report released recently, the Commission on Audit (COA) detailed multiple deficiencies in granting, using, and settling cash advances (CAs), contravening COA Circular No. 97-002 and the Government Auditing Code.

Major Findings:

1. P51.28 Million Unliquidated by Deadline:
   As of December 31, 2023, 11 Accountable Officers (AOs) failed to settle CAs totaling P51,279,480.44, violating rules requiring full year-end liquidation. This overstates receivables, understates expenses, and risks fund loss/misuse. Breakdown:
   • General Fund: P44,446,475.00
   • Special Education Fund: P1,833,005.44
   • Trust Fund: P5,000,000.00
     COA cited the Revised Penal Code, noting non-liquidation upon demand is prima facie evidence of personal fund use.
2. New Advances Granted Despite Outstanding Balances:
   One Special Disbursing Officer (SDO) received new CAs (including P52,500 on May 23 and P143,500 on June 20, 2023) before fully settling prior advances. This violated the prohibition on granting additional CAs without settling previous ones, increasing the risk of fund misuse or using new advances to cover old ones. COA provided a ledger excerpt confirming this practice.
3. Widespread Delays in Liquidation: P88.6 million in CAs for salaries/wages (Job Order workers, teachers, police, fire, jail personnel) in 2023 were liquidated late – by 1 to 56 days past the mandated 5-day deadline. Furthermore, P49.275 million granted in late 2022 for financial assistance programs (seniors, indigents, scholars) wasn’t fully settled until Q1 2023, taking 60-95 working days. Auditors also found:
   • Monthly Disbursement Reports not submitted on time.
   • CAs held beyond the allowed 2-month period.
   • Missing payout dates on payrolls.
4. Inaccurate Record-Keeping:
   Refunds of excess cash were recorded at month-end in ledgers, not on the actual refund date (per Official Receipts), violating accounting manuals and distorting the accuracy of financial records. COA listed 24 specific instances of date discrepancies.

COA Recommendations & City Response:
COA urged Bacoor City Mayor Strike Revilla to:

1. Direct AOs to immediately liquidate all outstanding CAs.
2. Instruct the City Accountant to stop granting new CAs to officials with unsettled advances and assign different officers instead.
3. Ensure refunds are recorded on actual transaction dates.

City Treasurer Rosemarie G. Reyes and City Accountant Ma. Lourdes C. Salazar stated that all year-end 2023 unliquidated CAs were settled by February 8, 2024. They acknowledged COA’s findings and committed to improving monitoring of cash advance processes.