Unrecognized compromise agreement liability
National Housing Authority · 2022
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What Happened?
Category: Financial ManagementIssue: Non-complianceThe agency has agreed to pay over a billion pesos in a settlement, but hasn't recorded this obligation in its financial statements yet.
Why It Matters
Recommended Actions
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Original Audit Finding Excerpt
"The compromise agreement, amounting to P1.122 billion, entered into by the NHA with a contractor to amicably settle the litigation under CA-GR CV No. 99324 dated February 7, 2018, was approved by the Court of Appeals based on the Decision issued on May 30, 2019. The amount of P1.122 billion is not yet recognized in the books pending the submission of the claim for settlement to the proper authorities, pursuant to Section 20(1), Chapter IV, Subtitle B, Title I, Book V of EO No. 292."