The city accounted for medicine purchases as used-up expenses right away instead of first recording them as inventory, making it difficult to track stock levels and prevent loss or misuse.

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Original Audit Finding Excerpt

"Sampled DVs for the procurement of drugs, medicines, and other medical supplies charged against the LDRRMF revealed that these were outrightly recorded as expenses in the books, instead of being recognized through the Inventory account, contrary to applicable accounting guidelines."

Source Document