In Lapu-Lapu City, COA flags P4.71M worth of purchases paid by reimbursements

The Lapu-Lapu City Hall. | CDN Digital file photo

CEBU CITY, Philippines — Government auditors flagged the P4.71 million worth of supplies, meals and accommodations, and maintenance and other expenses that the Lapu-Lapu City government acquired and which were paid by reimbursements.

These transactions, auditors said, did not undergo the required procurement process.

The practice was contrary to Section 48.2 of the Revised Implementing Rules and Regulations of the Government Procurement Reform Act and COA Circular No. 97-002, which “deprives the government of the advantages in competitive procurement,” the Commission on Audit (COA) said in its Annual Audit Report for 2022.

However, Mayor Junard Chan said that the audit finding was already addressed.  To date, his administration was already “cleared of any audit suspensions, disallowances, and charges.”

“Karaan kaayo to siya.  That was [in the] 2021 audit observation. Dili mana pasabot nga gitagaan ka ug audit observation dili naka hatagan ug kahigayonan to explain. So atong gitubag. Unya karon lately, latest nato sa 2023, cleared nato siya ang 2021 ug 2022,” Chan said.

In fact, Chan said the city government was recognized by the Department of Interior and Local Government (DILG) for its good financial house keeping.

“Right now, bag-ong gipagawas sa DILG, nga ang siyudad sa Lapu-Lapu qualifier siya sa 2022 Good Financial Housekeeping. Buot pasabot ana nga ang siyudad sa Lapu-Lapu, kining DILG, mosusi ni siya sa tanang ahensiya sa gobyerno, lakip na ang Commission on Audit, kung wala bakay pending didto nga mga audit observations. Buot pasabot ana, clear ta sa atong COA, wala tay nagpabilin nga audit observation or suspension,” the mayor said.

In its 2022 audit report, COA said that the city purchased supplies and services worth P4.71 million that were paid by reimbursements.

In the same report, auditors said that the city also procured the services two contractors, ALS and HMME Inc., to take care of the disposal of its residual waste.  The contract amounted to P86.9 million.

But state auditors noted that the two contractors “appeared” to be engaged in freight forwarding services and furniture manufacturing, not garbage disposal.

COA’s 2022 audit report was based on their review of transactions made for the entire year 2022.  A copy of said report was furnished to the Office of the Mayor earlier.

In a press conference on Monday, July 31, 2023, Chan said that they already complied with all of the requirements that COA mentioned in its 2022 report.

Chan said they even received communication from COA dated June 30, 2023, which said that the city was already “cleared” of any liabilities from their audit findings.

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