Non-recoupment of advances to contractors
National Housing Authority · 2023
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What Happened?
Category: Financial ManagementIssue: Non-complianceThe agency did not get back money it advanced to contractors for projects that are done or stopped, leaving over P152 million uncollected for years.
Why It Matters
Recommended Actions
- Require the Regional/Sector/District Managers concerned to facilitate the issuance of Certificates of Completion on completed projects and submit them to the AD so that the payables to the contractors can be recorded, net of advances to be fully recouped;
Original Audit Finding Excerpt
"Analysis of the Advances to contractors account showed that NHA has not recouped the advances totaling P152.426 million from the contractors/developers concerned on 53 infrastructure projects that have been either completed or terminated. Details are as follows: Table 13.1 Completed Projects Table 13.2 Terminated Projects The accounts had been outstanding for more than one year to over seven years from the project completion or termination, that comprises of: (a) unrecouped advances pertaining to 41 completed contracts amounting to P60.567 million; and (b) advance payments made to the contractors that were not fully recouped due to termination or rescission of 12 contracts amounting to P91.859 million."