Non-Restoration of Trust Liability for Stale MDS Checks
Department of Public Works and Highways · 2024
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What Happened?
Category: Financial ManagementIssue: Non-complianceChecks that expired without being cashed were not written off or taken back into the books as they should have been. This made the agency's liabilities look smaller and its accumulated surplus look larger than it actually was.
Why It Matters
Recommended Actions
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Original Audit Finding Excerpt
"The reported balance of the Guaranty/Security Deposits Payable account is understated by P12,495,003.14 due to non -restoration of trust liability for stale Modified Disbursement System check contrary to Section 97(1) of Presidential Decree No. 1445 and Sections 44 and 45, Chapter 6 , Volume I of Government Accounting Manual for National Government Agencies."