DepEd RO IX

Preparation of the
2024 Year End Reports
Observations & Recommendations

15 January 2025
NEAP - R
Tiguma, Pagadian City
Different formats used on the submitted
Financial Statements
COA OBSERVATION &
RECOMMENDATION
OBSERVATION
Different Audited Agencies employ different
format on their submitted Financial
Statements.

3
RECOMMENDATION
Use a uniform format on the submitted
Financial Statements.

Paper Size: A4-size paper

Page Number: position at the bottom right,
Arial 10
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RECOMMENDATION
Margins Used: Left – 1 ¼”
All other sizes – 1”
Font Used: Arial 11
Software for Text: MS Word
Software for AFS MS Excel

5
RECOMMENDATION
Order of FS Presentation:
1. SFP 4. SCF
2. SFPer 5. SCBAA
3. SCNAE 6. NFS

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Financial Statements include Unreconciled
and/or Erroneous Balances
COA OBSERVATION &
RECOMMENDATION
OBSERVATION
The Financial Statements include unreconciled
and/or mathematically-erroneous balances.

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RECOMMENDATION
FS Balance Considerations:

1. The amount of Accumulated Surplus/(Deficit)to be

presented in the beginning balance of the current
year column of the SCNAE shall be taken from the
Balance at December 31, 2023 which was carried
forward as beginning balance in the Books of
Accounts/General Ledger at January 1, 2024
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RECOMMENDATION
2. The amount to be reflected in the Changes in
Accounting Policy in the SCNAE represents the
difference between the net amount of direct
adjustments to “Accumulated Surplus/(Deficit”
account due to “Changes in Accounting Policy” as
reflected in the SCNA/E, Accumulated Surplus/
(Deficit) for CY 2023 as Restated and the amount in
the SCNA/E, Accumulated Surplus/(Deficit) at
December 31, 2023

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RECOMMENDATION
3. The amount to be reflected in the Prior Period
Adjustments/Unrecorded Income & Expenses
in the SCNAE represents the difference
between the amount of “Surplus/(Deficit) for
the Period” reflected in the Statement of
Financial Performance for CY 2023 as
Restated and the amount in the Statement of
Financial Performance at December 31, 2023.
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RECOMMENDATION
4. The amount to be reflected in the Other Adjustments
represents the difference between the net amount
of direct adjustments to “Accumulated Surplus/
(Deficit” account due to “Other Adjustments”(or
adjustments pertaining to year/s prior to CY 2023)
as reflected in the SCNA/E (Accumulated Surplus/
(Deficit) for CY 2023 as Restated and the amount in
the SCNA/E (Accumulated Surplus/(Deficit) at
December 31, 2023.

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RECOMMENDATION
5. The amount to be reflected in Restated Balances in the
SCNAE represents the sum of Beginning Balance at
December 31, 2023 and the net adjustments to
Accumulated Surplus/(Deficit) account due to:(1) Changes
in Accounting Policy, (2) Prior Period Adjustments/
Unrecorded Income and Expenses, and (3) Other
Adjustments, as shown above. This should tally with the
balance of the Accumulated Surplus/(Deficit) account in
the Statement of Financial Position and the SCNA/E,
Accumulated Surplus/(Deficit) both for CY 2023, as
Restated.
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RECOMMENDATION
6. The amount to be reflected in this Changes
in Net Assets / Equity for Calendar Year of
the SCNAE represents the sum of “Total
Recognized Revenue and Expenses for the
Period” and “Others”

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RECOMMENDATION
7. The amount to be reflected in Adjustment of
Net Revenue recognized directly in Net
Assets/Equity of the SCNAE represents the
total amount of accounts “Cash – Treasury
Agency Deposit, Regular” and Cash – Treasury
Agency Deposit, Special Account” closed to the
Accumulated Surplus/(Deficit) account during
the year.
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RECOMMENDATION
8. The amount to be reflected in
Surplus/(Deficit) for the Period of the
SCNAE represents Surplus/(Deficit) as
presented in the Statement of Financial
Performance for the Year Ended December
31, 2024.

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RECOMMENDATION
9. The amount to be reflected in Total
Recognized Revenue and Expenses for the
Period of the SCNAE represents the sum of
“Adjustment of Net Revenue recognized
directly in Net Assets/Equity” and “Surplus/
(Deficit) for the Period”.

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RECOMMENDATION
10. The amount to be reflected in "Others" row
in the SCNAE is the difference between
the Restated Balance of account
“Accumulated Surplus/(Deficit” for
CY 2023 and the amount reflected in the
Adjusted Pre-Closing Trial Balance as of
December 31, 2024.
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RECOMMENDATION
11. The amount to be reflected in Balance at
December 31, 2024 Carried Forward of the
SCNAE represents the sum of “Restated
Balance” and “Changes in Net Assets/Equity
for Calendar Year” as shown above. This
should tally with the balance of Accumulated
Surplus/(Deficit) account reflected in the
Statement of Financial Position as of
December 31, 2024.
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RECOMMENDATION
12. The amount of “Surplus/(Deficit) for the
Period” should tally with the amount of
“Surplus/(Deficit) for the Period” as
reflected in the Statement of Changes in
Net Assets/Equity, Accumulated Surplus/
(Deficit) for the Year Ended December 31,
2024.
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RECOMMENDATION
13. Cash and Cash Equivalents January 1,
2023 reported in the Statement of Cash
Flows should tally with the Total Balance of
Cash and Cash Equivalents in the
Statement of Financial Position as of
January 1, 2023;

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RECOMMENDATION
14. Cash and Cash Equivalents as of
December 31, 2024 reported in the
Statement of Cash Flows should tally with
the Total Balance of Cash and Cash
Equivalents in the Statement of Financial
Position as of December 31, 2024.

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RECOMMENDATION
15. Inclusion of Constructive Receipt of NCA
for TRA and Remittance of Taxes thru TRA;
16. Receipt and release of intra agency fund
transfers must be reconciled and
eliminated;

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RECOMMENDATION
17. Collection of Income can be traced and
reconciled with the Statement of Financial
Performance and FAR No. 5, as applicable;
18. Remittances of collections (revenues and
other receipts) can be traced and reconciled
with the Pre-Closing Trial Balances, SCNA/E
and FAR No. 5, as applicable;
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RECOMMENDATION
19. Grant of Cash Advances granted during
the year should be net of liquidations
during the year;
20. Prepayments during the year should be
net of amount utilized/expended during
the year;
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RECOMMENDATION
21. Net profit/loss figure in SFPer tallies with
that in SCNAE
22. Cash and cash equivalents figure per SCF
tallies with that in SFPos
23. Cash as of the EO prior year agrees with
the beginning balance of cash per SCF
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RECOMMENDATION
21. Net profit/loss figure in SFPer tallies with
that in SCNAE
22. Cash and cash equivalents figure per SCF
tallies with that in SFPos
23. Cash as of the EO prior year agrees with
the beginning balance of cash per SCF
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RECOMMENDATION
24. Accounts presented in SFPos in the order
of Liquidity
25. SMR for FS should be signed by P/C
Accountants and LCE/Head of Agency.
26. The SMR should include the date the SMR
was signed
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RECOMMENDATION
27. In NFS, use IPSAS as basis of preparation
of FS instead of PPSAS.
28. NFS should present comparative figures.
29. NFS to provide additional information to
support the figures in the FS.

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RECOMMENDATION
30. Disclose reconciliation of Net Cash Flows from
Operating Activities to Surplus / (Deficit) in NFS.
31. Disclose reconciliation between actual amounts
on a comparable basis as presented in the
SCBAA and in the SFPer in the NFS. Ending
balance of the reconciliation should tally with the
Net Surplus/(Deficit) per SFPer.

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RECOMMENDATION
32. In NFS, movement of PPE should be presented (i.e.
Beginning Balance, Additions, Reductions, Ending
Balance).
33. Disclose receipt and utilization of Local and National
DRRMF per COA Circular 2012-002 and COA Circular
2014-002, respectively.
34. Present with comparative information of the previous
year (current years’ figure & column heading in the AFS
highlighted (backfilled with light gray background 2))

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RECOMMENDATION
35. Each item on the face of SFPos, SFPer, SCNAE and
SCF correctly cross-referred to related information in
the NFS
36. Numbering of Notes in the NFS follows order of
accounts presentation in the SFP, SPL/SCI, SCE and
SCF in one column
37. Abnormal balances of accounts (should be verified
and nature should be disclosed in the Notes)

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Restatement of Financial Statements
COA OBSERVATION &
RECOMMENDATION
OBSERVATION
After the submission of the Financial
Statements to the Agency Auditors but prior to
the preparation of the Management Letter, the
Financial Statements are restated.

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RECOMMENDATION
After the submission of the Financial
Statements to the Agency Auditors, no
restatement of balances are allowed. Any
changes are to be reflected on the restated
statement of the following calendar year.

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Submitted FS to the Auditors and to the RO IX
COA OBSERVATION &
RECOMMENDATION
OBSERVATION
Some Audited Agencies submitted their
tentative FS to the Agency Auditors. When the
FSes are consolidated with the RO IX books,
there could be changes to the figures resulting
in discrepancies.

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RECOMMENDATION
Audited Agency must ensure that any Financial
Statement submitted to the Agency Auditors
are the final versions of the Financial
Statements.

38
Use of Different Font Colors in the FS and NFS
COA OBSERVATION &
RECOMMENDATION
OBSERVATION
The submitted Financial Statements had fonts
in different colors like Red, Blue or Green,
among others.

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RECOMMENDATION
Use only the standard Black font color in the
submitted FS.

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Estimated Useful Life of PPEs
COA OBSERVATION &
RECOMMENDATION
OBSERVATION
It was noted during audit that the Regional
Office, the Divisions and the Implementing
Units apply different estimated useful life on
their assets.

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RECOMMENDATION
Have an agency-wide uniform application of
the estimated useful life on depreciable
property, plant and equipment.

Either have it through a memorandum or

through a DepEd Order.
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BASIS
Section 27, Chapter 10 of GAM Volume I

The estimation of the useful life of the asset is a matter of

judgment based on the experience of the entity with similar
assets. The agency/entity is in the best position to estimate
the expected useful life of its PPE. As a guideline, PPE shall
be depreciated over the following life spans:

Buildings and Other Structures - 30 to 50 years

Machinery and Equipment - 5 to 15 years
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Use of Performance Securing Declaration
COA OBSERVATION &
RECOMMENDATION
OBSERVATION
Procuring Entities still allowed the receipt of
Performance Securing Declaration in lieu of
the posting of Performance Security in their
procurement activities.

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RECOMMENDATION
Stop the use of Performance Securing
Declaration in lieu of the posting of
Performance Security.

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BASIS
GPPB Resolution No. 09-2020 - PSD can be
only be used during the following:

1. During a state of calamity

2. When community quarantine or similar
restrictions are in place
3. As an option in a Framework Agreement
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Thank you!
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