COA flags city government for 2,000 unrecorded lots

By Joseph Bernard A. Marzan

More than 2,000 lands registered with the Iloilo City government were found by the Commission on Audit (COA) to have been unrecorded in accounting books, leaving out almost ₱9 billion in unlogged property assets.

One of the items flagged by the COA in its 2022 Annual Audit Report were the 2,009 units of city government land that were not covered by Transfer Certificates of Title (TCT), therefore not recorded in the books.

The commission said that this caused the reconciled items under the city’s land accounts to be understated at ₱8.909 billion.

In accounting terms, when items are understated, it means that their actual amount is greater than what is reported based on respective rules of accounting.

This was first raised by the COA in its Audit Observation Memorandum (AOM) No. 2023-005 dated March 20, 2023.

The city government lands cited were found to have been recorded either with the City Assessor’s Office or the Registry of Property, Plant, and Equipment of the General Services Office (GSO), but the TCTs were unrecorded in the books as they were not obtained due to unavailability of information and related records.

The COA found this as inconsistent with Sections 148 and 155 of COA Circular No. 92-386 (Prescribing Rules and Regulations on Supply and Property Management in the Local Governments).

These provisions refer to the Local Chief Executive’s immediate responsibility over the proper and effective use and management of real property owned or titled to the name of the Local Government Unit (LGU), and the duty of the GSO chief to keep a record of all of the LGU’s supplies and properties.

There is a total of 2,122 city government lands registered in its land accounts under the Accounting, GSO, and Assessor offices, and the 2,009 are part of 2,041 units of land that remained unreconciled, according to COA.

The other 32 items include an unreconciled land under the General Fund with a beginning balance of ₱144,953.33, and 31 units of land also under the General Fund that were recorded in accounting but not in the GSO and Assessor records amounting to ₱326.24 million.

Aside from these, there were also 5 other land units under the Special Education Fund valued at ₱6.9 million including 1 which had an unreconciled beginning balance amounting to ₱1.33 million, and 4 with an amount of ₱5.56 million which were recorded in the accounting office but not in the Assessor and GSO offices.

In its response to the AOM, the city government told COA that they have requested from the Registry of Deeds the Certified True Copies of the TCTs for 234 units of the land, which would be released once the assessment fee was settled.

The COA recommended the following to the city government, which it agreed to by directing its Plant, Property, and Equipment Inventory Division (PPEID) to:

–          Expedite the request for the issuance of Original or Certified True Copy of the TCTs of 287 identified lands, and furnish copies for the City Accountant’s and the GSO’s records;

–          Coordinate with the GSO chief to identify lands donated or transferred to the city government, request a copy of documents as proof, and require the GSO to register them with the Registry of Deeds;

–          Coordinate with the Land Management Bureau and request copies of land ownership-related documents; and

–          Reconcile the results of verification and physical count of land with the records of Accounting, GSO and City Assessor, and furnish the City Accountant of the reconciled units so that appropriate adjusting entries could be drawn.

This was just one of 9 exceptions outlined by the COA in its 2022 Annual Audit Report on the city government, published online on June 30.

COA gave the city government a qualified opinion for the fairness of presentation of its financial statements in 2022.