The agency signed contracts without having enough budget approved, causing overspending and forcing many housing projects to stop. Even if all remaining funds were received, they still wouldn't cover the costs, so projects are at risk of being cancelled and money wasted.

Why It Matters

Recommended Actions

• Management: a. Ensure that all contracts to be awarded to contractors for the proposed housing projects have sufficient funds, pursuant to Item 5.7 of DBM Circular No. 2010-9 dated December 30, 2010, by requiring Certificate of Budget Allocation prior to the awarding of contracts.
• And b. Ascertain that all contracts to be entered into are within the total allotments released by the DBM, pursuant to Section 41, Chapter 5, Book VI of EO No. 292 or the Administrative Code of the Philippines, by dividing the budget for each RO/DO and informing them their respective budgets for operation so that every RO/DO is aware of their remaining budget limit as of a given period.

Original Audit Finding Excerpt

"The Authority entered into various contracts pending the release of funds from the National Government, resulting in allotment overdraft amounting to P18.163 billion, contrary to the related provisions of DBM Circular No. 2010-9 dated December 30, 2010 and EO No. 292, s.1987 or the Administrative Code of the Philippines."

Source Document