Erroneous recording of prior year's expenses in current year
Department of Public Works and Highways · 2024
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What Happened?
Category: Financial ManagementIssue: ErrorExpenses belonging to previous years were accidentally charged against the current year's budget, violating proper accounting cut-off rules.
Why It Matters
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Original Audit Finding Excerpt
"427 Observations and Recommendations Reference Management Action Auditor’s Results of Validation We recommended and Management of the DEOs concerned agreed to direct the Accountants as follows: 23. Benguet 2 nd DEO in CAR, Mindoro Oriental DEO in Region IV -B and Sorsogon 1 st DEO in Region V to prepare the necessary adjusting journal entries to drop from the books of accounts the lost, replaced portions and demolished Property, Plant and Equipment which were already identified for derecognition; and 24. Tarlac 1 st DEO in Region III, Sorsogon 2 nd DEO, Catanduanes DEO and Camarines Norte DEO in Region V and Bukidnon 1 st DEO in Region X to coordinate with the Roads and Bridges Information Application Coordinators for the proper identification and subsequent derecognition of the replaced portions of roads from the books. Substantial adjustment was recorded to drop from the books of accounts the lost, replaced portions"