Prior Year Adjustments Not Restated
National Housing Authority · 2023
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What Happened?
Category: Financial ManagementIssue: Non-complianceThe company made corrections to previous years' numbers but did not go back and fix the prior year columns in the financial statements, which could mislead users about the true financial position.
Why It Matters
Recommended Actions
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Original Audit Finding Excerpt
"Moreover, prior year adjustments and unrecorded income and expenses incurred, along with adjustments to accrued rental and interest receivables, and financial assistance due to the recognition of Loans Receivable for accounts with Individual Loan Agreements in prior years amounted to P39.533 million, P222.419 million, P271.745 million, and P1.650 billion, respectively. These adjustments were not restated in the FS because Management decided not to restate the comparative balances for prior periods since the income tax return (ITR) was already filed based on the CY 2023 financial statements submitted on February 14, 2024. Failure to restate prior year adjustments may compromise the accuracy, reliability and reduced transparency of the financial statements."