The Commission on Audit (COA) has flagged the province of Masbate over the P131 million "unliquidated cash advances" (CAs) granted to various officials and employees in 2023.
In its 2023 annual audit report (AAR), COA said the cash advances were composed of three categories -- advances for payroll (P420,804.50), advances to special disbursing officer (P80,484,445.21), and advances to officials and employees (P50,280,475.78).
It said the amount incurred in 2023 showed an increase of P52,433,170.58 million or 66.58 percent more compared to the 2022 balance of P78,752,554.91.
"This was attributed to the CAs for the various activities of the provincial government, such as Founding Anniversary, Rodeo Festival, Bagat-Dagat Festival, among others, which were not liquidated during the year," the audit report said.
It lamented that additional CAs were granted despite failure of the accountable officers to settle their previous outstanding CAs. Some CAs were even granted despite incomplete supporting documents, it pointed out.
As a result, the report stated that "expenses were not properly recognized on periods they were incurred resulting in the understatement of expense accounts and overstatement of the assets and equity accounts by the same amounts."
It noted that a lot of officials and employees are also no longer working for the province because they have retired, are deceased, or transferred to other agencies and this caused the CA balance to balloon towards the end of 2023.
The COA said it has warned the province of Masbate over the accumulation of CAs, and state auditors said that their previous observations have been disregarded.
It said that state auditors have issued demand letters to the concerned officials and employees of the province, and they warned that failure to render an account in full within the periods prescribed and after formal demand will constitute an administrative offense of Gross Neglect of Duty punishable by dismissal from the service for the first offense.
It also warned that full liquidation or payment of the CA outside the prescribed periods will constitute the offense of Simple Neglect of Duty punishable by suspension from the service for one month and one day to six months for the first offense, and dismissal from the service for the second offense.