GOVERNMENT auditors have underscored the need for transparency in the utilization by local government units of government funds under the Bayanihan Grant to Cities and Municipalities (BGCM).
In the 2020 audit reports released yesterday, the audit team called out the municipal government of Sagada for co-mingling the Bayanihan Fund with its general fund which tends to make monitoring of usage difficult.
Likewise, the municipal government of Bontoc was flagged for inadequate documentation on the procurement of supplies and equipment using the Bayanihan cash grant.
Sagada was reminded that under Local Budget Circular No. 125 issued by the Department of Budget and Management, LGUs were instructed to create a special account in the general fund (SAGF) for the BGCM “for easy monitoring/tracking of utilization.”
Records showed Sagada had P6.08 million BGCM for 2020 equivalent to its one-month Internal Revenue Allotment (IRA) share but the Appropriation Ordinance 02-2020 merely set the sums without mentioning the SAGF.
(The) LGU …did not include the creation of a SAGF for the BGCM. Inquiry from Management further disclosed that apart from AO No. 02-2020, there was no other ordinance enacted relative to the required creation of a SAGF for the BGCM,” the Commission on Audit noted.
Among the major programs and activities funded by the Bayanihan grant were procurement of relief goods (P2.13 million); personal protective equipment or PPE (P527,850); and disinfectants, sprayers and other supplies (P301,995).
Reacting to the audit remark, the municipal government assured the COA that a special account will be created for the BGCM to make tracking of expenditure easier.
Auditors also called Bontoc’s attention to the submission on incomplete documentation in liquidating procurements made using the Bayanihan Fund even as they acknowledged that the items were urgent in nature.
“Emergency procurement of highly needed supplies, materials, equipment, utilities and other critical services for COVID-19 related programs, projects, and activities, charged to Bayanihan Grant, were not supported with complete documentation,” the audit team notified the municipal government.
Under the Government Procurement Policy Board Circular No. 01-2020 transactions worth P500,000 or below must be supported by a copy of the mayor’s permit or a valid business permit while those with approved budget for the contract (ABC) higher than P500,000 require additional documents a copy of the income tax or business tax return of the supplier and an omnibus sworn statement.
However, these requirements were not complied with.
“Post-audit of the disbursements charged to the Bayanihan Grant revealed that most of the vouchers lack …documentary requirements. (T)here were 76 vouchers with an ABC of below P500,000.00 which were not supported with the suppliers’ Mayor’s or Business Permits, while seven vouchers involving projects with an ABC of more than P500,000.00 were not supported with either Income Tax Return, Mayor’s or Business Permit or Omnibus Sworn Statement,” the audit team said.
The Municipal Accountant explained that restrictions on travel during the pandemic prompted a relaxation of some rules that allowed vouchers to be processed despite the missing documentary requirements.
In these cases, the suppliers/contractors made a commitment that they will submit these documents upon payment. However, the said assurance went unfulfilled.
“The non-submission of the above documents prevented the Audit Team from ascertaining that the suppliers/contractors concerned are legally, technically, and financially capable to have transactions with the local government unit,” the COA pointed out.
The municipal government said it will take steps to compel the completion of the documentary requirements and that future procurement transactions will be backed by complete documents.
