Accumulation of Unliquidated Advances and Subsequent Fund Releases to LGUs
National Housing Authority · 2022
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What Happened?
Category: Financial ManagementIssue: Non-complianceBillions of pesos in cash advances given to local government units remain unliquidated over many years, and new funds were illegally released to them despite their failure to account for previous money.
Why It Matters
Recommended Actions
- Coordinate with the concerned LGUs for the submission of their liquidation reports and the return of unutilized funds, particularly for advances that have been outstanding for more than a year
Original Audit Finding Excerpt
"Improper management of the fund transfers granted to various Local Government Units (LGUs) from CYs 1995 to 2021 for land development and housing construction resulted in the accumulation of unliquidated advances totaling P3.538 billion as at December 31, 2022, contrary to the relevant provisions of PD No. 1445 and NHA MC No. 2018-030 dated October 12, 2018. Furthermore, subsequent releases of funds totaling P668.142 million to 30 LGUs were noted in CY 2022, despite the non-liquidation of the previous advances, contrary to the relevant provisions of COA Circular No. 2012-001 dated June 14, 2012, as amended by COA Circular No. 2016-002 dated May 31, 2016."