COA report uncovers DOLE’s P3.5-billion unliquidated fund transfers in 2017

The Commission on Audit (COA) has called out the Department of Labor and Employment (DOLE) for its alleged failure to liquidate nearly P3.5 billion of fund transfer it made to various government agencies last year.

In its annual audit report, the COA said DOLE transferred about P3.48 billion to various government agencies for project implementations that remain unliquidated as of December 31, 2017.

“Due to the absence of a monitoring system for the funds transferred to government agencies for the implementation of the projects, and for failure to review and analyze the outcomes, the implementation of the fund transfers totaling ₱3,480,946,272.38 is doubtful,” the state audit agency said in the report.

“Moreover, the validity of the total account balances at year-end is likewise doubtful due to failure of implementing agencies (IA) to submit liquidation reports,” it added.

The audit revealed that the implementation of the projects that were funded by DOLE “in accordance with their purpose was not monitored through a monthly report disbursement,” which is required under COA Circular NO. 94-013 dated December 13, 1994.

Furthermore, the audit report said the non-liquidation of funds is a violation of COA Circular No. 2007-001 dated October 25, 2007, which requires agencies to submit the final fund utilization report within 60 days after the completion of a project.

The audit report revealed that the DOLE-Central Office (CO) alone has a unliquidated fund transfer amounting to P302.738 million.

Bulk of the amount or about 74.75 percent were transferred to national government agencies (NGAs) which totaled to P226.303 million by the end of 2017.

Majority of the fund transfer made by the DOLE-CO was to Overseas Workers Welfare Administration for the implementation of the agency’s Emergency Repatriation Program (ERP). The DOLE-CO transferred P186.102 million to OWWA for the ERP.

Furthermore, the DOLE-CO’s due from government-owned or controlled corporations (GOCCs) amounted to P5.867 million as of end-2017.

The DOLE-CO also had an unliquidated fund transfer to local government units (LGUs) amounting to P5.404 million, according to the audit report.

Of the total amount due from LGUs, P4.749 million was transferred to the Local Government of Malabang, Lanao del Sur on December 27, 2017 for the implementation of the Tulong Panghanapbuhay sa Ating Disadvantaged Workers, according to the audit.

Furthermore, a P500,000-fund transfer was made by DOLE-CO to the Provincial Government of Tawi-tawi as an advance for the approved project proposal entitled Agar-Agar Farming Project.

Both projects were not monitored by DOLE, according to the report.

Furthermore, DOLE-CO had an unliquidated fund transfer to non-government organizations/peoples organizations (NGOs/POs) amounting to P25.162 million.

The COA report revealed that DOLE-Regional Office (RO) VI had the most unliquidated fund transfer by the end of last year amounting to a total of P645.348 million.

The state auditors said DA-RO VI transferred the funds to Accredited Co-Partners, NGAs, Government Owned and Controlled Corporations, LGUs, and NGOs/POs “as loans and financial assistance.” The P645.348-million fund transfer “remained uncollected and unliquidated as of December 31,2017 due to laxity in the enforcement” of COA circulars, according to the report.

“Thus proper utilization of funds could not be ascertained and reported receivables balances remained of doubtful validity,” the COA said.

“Moreover, funds amounting to ₱123,477,108.23 were transferred to various LGUs despite  non liquidation of previous funds transferred, contrary to Section 10 of the Procedures Manual of the Department of Labor and Employment on the Provision of Livelihood Project Grant and COA Circular 2016-002 and 97-002 dated May 31, 2016 and February 10,1997, respectively, resulting in the accumulation of unliquidated balances at year end,” the COA added.

The state audit agency emphasized that “a close and regular monitoring of implementations of project and utilization of project funds transferred to other agencies totaling ₱3,480,946,272.38 is 53 percent of the total current assets of the department is imperative.”

“We recommended that Management require the bureau directors in coordination with the planning service to closely monitor the project implementation and strictly require the IAs on the monthly submission of Report of Disbursements,” it said.

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Jasper Emmanuel Y. Arcalas is a graduate of the UST Journalism School (Batch 2016). He currently covers agribusiness for the BusinessMirror. He joined the news outfit in August 2016.


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