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Technical of Education and Skill Development Authority
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Regional Office No.2
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Carig Norte, Tuguegarao City
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Agency Action Plan and Status of Implementation
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As June 30, 2021
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Reference No. (AOM)Audit ObservationsAudit RecommendationsAgency Action PlanStatus of ImplementationReason for Partial/Delay/Non-Implementation, if applicableAction Taken/Action to be taken
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Action PlanPerson/Dept. ResponsibleTarget Implementation Date
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FromTo
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AOM No. 2020-001Bank reconciliation statements for the trust fund of TESDA Regional Office were not prepared monthly and regularly, thus reconciling items requiring adjustments were not timely effected during the period to which they have occurred, resulting in unreconciled differences between the book and bank balances contrary to Sections 74 of Presidential Decree (P.D.) 1445 and Chapter 21 of the Government and Accounting Manual (GAM) for NGAs, Volume I.Management should advise the Accountant/designated staff to:

a) prepare Journal Entry Voucher (JEV) to recognize all reconciling items noted in the bank reconciliation statements in order to arrive at reliable cash in bank balances. Likewise, furnish the concerned banks of the latest bank reconciliation statements requesting them to effect the bank reconciling items noted thereof; and

b) prepare and submit the monthly Bank Reconciliation Statement (BRS) for each bank account maintained by the agency within ten days from receipt of the monthly Bank Statement (BS) and submit the BRS, together with all the supporting documents and JEV, to COA within twenty days after receipt of the monthly BS pursuant to Section 21 of GAM for NGAs, Volume l.		Management agree to the observation that Bank Reconciliation were not conducted on a regular basis resulting to non-detection and correction of reconciling items on a timely basis. However, please note also that the non-recognition of some reconciling items were due to the fact that some Fund Transfers made by the Central Office were not coupled with notices of such fund transfers made. The other reconciling items is a result of the practice of the Office in observing a cut-off date in the recording of transactions making the discrepancy a matter of timing difference. Late preparation of Bank Reconciliation is also partly due to late release of bank statements by the Land Bank of the PhilippinesAcctg DeptSept. 2020Dec. 2020Fully ImplementedManagement have already effect the recommended Journal entries to recognize all reconciling items noted in the bank reconciliation.PLease refer to JEV Nos. TF-2020-07-001, TF 2020-07-002, TF 2020-08-003 and TF 2020-08-004 with an aggregate amount of P859,978.34, which account for the difference between the book and bank balance of the Cash in Bank, LCCA as of January 2020. Also, JEV Nos. TF-2020-08-005 and TF-202-08-006 were also attached to record interest income earned, net of tax for the quarters ended March 31, 2020 and June 30, 2020. Also attached is a copy of the general journal for the month of July and August 2020, showing all the adjustments made.

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AOM No. 2020-002The reported balance of Cash in Bank, Local Currency Current Account (LCCA) for the trust fund account amounting to ₱44,327,575.26 as of July 31, 2020 cannot be relied upon due to unexpended cash balance which remained unreturned to the source agency, despite the completion of the program for which the account was established, amounting to ₱43,537,120.44, contrary to TESDA Circular No. 60, Series of 2018. Moreover, the trust fund account was used to receive and disburse funds other than for its intended purpose totaling ₱2,847,416.32, exposing the fund to possible risk of misappropriation, contrary to Section 4.3 of Presidential Decree 1445.Management should:

a) instruct the concerned schools to expedite the liquidation on the funds received for Free TVET under UAQTEA program CY 2018 in the total amount of ₱35,284,145.65, so all unused amount shall be included in the unexpended balance remaining in the cash in bank account of ₱43,537,120.44. Eventually, total unused amount shall be returned to the TESDA Central Office and ultimately reverted to BTr, pursuant to Part XI, Sections 8 and 11 of TESDA Circular No. 60, Series of 2018, since the purpose for which the account was established shall cease.

b) instruct the Accountant to effect the transfer of the GSIS insurance proceeds to TESDA-API and TESDA Batanes in the amount of ₱716,814.78 and ₱73,640.04, respectively and submit proof of transfer to the Auditor’s Office.

c) refrain from using the Trust Fund account as depository and disbursing account for transactions not related to the program for which the fund was established to avoid misappropriation. If possible, the agency should opt that funds be transferred directly to the bank accounts of the implementing units particularly for those necessitating immediate utilization such as insurance claims.
Management are still in the process of liquidating the Trust Fund and are targeting to have the fund fully liquidated before the end of the year. As of October 31, 2020, the Cash-In-Bank balance amounted only to P15,380,365.86. Please note that as of September 4, 2020 we already have initially returned to our Central Office the amount of P 18,087,916.98 as partial return of unexpended cash in the implementation of CY2018 UAQTEA since it is provided for in Section XI.8 of TESDA Circular No. 60, s. 2018 that “The TESDA RO shall return to the TESDA Central Office any unused balance of the funds transferred upon completion of the Project”. The remaining fund will be eventually returned to the source agency once the final liquidation is completed and submitted by all the implementing units. We are making a constant reminder and follow-up with the implementing units who have not yet submitted their liquidation reports in order to expedite the liquidation of the fund.

Acctg DeptSept. 2020Dec. 2020Fully ImplementedManagement are still in the process of liquidating the Trust Fund and are targeting to have the fund fully liquidated before the end of the year. As of October 31, 2020, the Cash-In-Bank balance amounted only to P15,380,365.86. Please note that as of September 4, 2020 we already have initially returned to our Central Office the amount of P 18,087,916.98 as partial return of unexpended cash in the implementation of CY2018 UAQTEA since it is provided for in Section XI.8 of TESDA Circular No. 60, s. 2018 that “The TESDA RO shall return to the TESDA Central Office any unused balance of the funds transferred upon completion of the Project”. The remaining fund will be eventually returned to the source agency once the final liquidation is completed and submitted by all the implementing units. We are making a constant reminder and follow-up with the implementing units who have not yet submitted their liquidation reports in order to expedite the liquidation of the fund.

With regard to the receipt and disbursement of funds for other purposes, please note that although the trust fund account was initially opened for implementation of the CY2018 UAQTEA Fund, there is no other existing account on which the Central Office can transfer or deposit funds from other agencies for implementation of other projects from other agencies, thus, the Central Office have opted to transfer the fund of the DOTR using the existing trust fund account. All the other accounts which were previously maintained by the Regional Office were already closed as per recommendation of the previous COA resident auditors, thus, it is only through the trust account which was initially opened for UAQTEA that the Central Office can transfer other funds intended for other purposes since the Regional Office maintain only two (2) accounts, the trust account initially opened for implementation of the UAQTEA program and the Regular Agency account which is MDS Account, wherein the Central Office will be unable to make fund transfer from a current account.

Please note further that the proceeds of GSIS Insurance for TESDA API amounting to P716,814.78 and TESDA LIT and TESDA Batanes amounting to P73,640.04 were already transferred to the respective operating units
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Prepared by:
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LIZA R. DE LA CRUZ
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Concurrent Regional Acountant
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