Improper Recording of BP2 Program Infrastructure and Equipment as Expenses
National Housing Authority · 2022
This summary was generated automatically from the source document and may contain errors. It is not an official interpretation and should not be relied upon as legal guidance. Review the original excerpt and source document to verify before citing or acting on it.
What Happened?
Category: Financial ManagementIssue: Non-complianceNHA spent money on buildings and equipment for the BP2 program but wrote it off as a day-to-day expense rather than recording it as a long-term asset. This makes the financial statements misleading because expenses are overstated and assets are understated.
Why It Matters
Recommended Actions
- Record the proper accounting entries to reflect the correct balance of the affected expense and asset accounts
- And Reconcile the AD and NCR East Sector records for the properties maintained at the BP2 premises.
Original Audit Finding Excerpt
"provided technical and administrative support to the Council, built infrastructure projects, and purchased equipment for the BP2 Depot totaling P83.713 million from CY 2020 to CY 2022, which was improperly recorded in the books as expense in CY 2022, contrary to the provisions of IPSAS 17, thereby affecting the reliability and accuracy of the expense and related accounts in the FS."