EXECUTIVE SUMMARY

A. HIGHLIGHTS OF FINANCIAL INFORMATION

For the year 2011, the Municipality of Dasol, Pangasinan was able to realize a

total income of P64,469,330.23 which had increased by P8,961,574.28 or 16.14 percent compared with last year’s income of P55,507,755.95. Total appropriations for the year amounted to P67,680,220.29 of which the amount of P52,963,683.48 was actually obligated.

The total assets of the Municipality amounted to P110,139,074.46 while the total amount of liabilities was P14,054,827.19 registering an increase in assets by P9,132,475.70 or 9.04 percent and a decrease in liabilities by P1,760,640.06 or 12.52 percent compared with 2010. The Government Equity, on the other hand, amounted to P96,084,247.27 which correspondingly increased by P10,893,115.76 or 12.79 percent in comparison with last year.

B. OPERATIONAL HIGHLIGHTS

The following were some of the significant accomplishments of the municipality for the calendar year 2011:

Project/Program Project Cost Status

1. Construction of Sangguniang Bayan Office P 500,000.00 Completed 2. Concrete Paving of Barangay Roads 723,192.00 Completed 3. Concrete Paving of Bobonot-Tambobong Road 1,999,999.92 On going 4. Installation/Rehabilitation of Brgy Street lights 210,296.00 Completed 5. Repair/Rehabilitation of Various School Bldgs. 1,281,274.00 Completed 6. Improvement of Water Supply System 190,900.00 Completed 7. Construction of multi-Purpose Drying

Pavement

276,890.00

Completed

C. SCOPE OF AUDIT

A Financial and Compliance Audit was conducted on the accounts and operations of the Municipality of Dasol. The audit consisted of review of operating procedures, inspections of the municipality’s programs and projects, interviews with officials and employees, verifications of accounts and such other procedures considered necessary under the circumstances.

A Value for Money (VFM) Audit was also conducted to determine whether the goals and objectives of the agency were attained in terms of economy, efficiency and effectiveness.

D. AUDITOR’S OPINION ON THE FINANCIAL STATEMENTS

The Auditor rendered a qualified opinion on the fairness of presentation of the financial statements for reason that no physical inventory was conducted by management of its Property, Plant and Equipment (PPE) valued at P85,194,100.13, thus accuracy, existence and validity of the account could not be ascertained.

E. SIGNIFICANT FINDINGS AND RECOMMENDATIONS

Hereunder are some of the significant audit findings and the corresponding recommendations which were discussed with the management during the exit conference. Management comments were incorporated in the report, where appropriate.

1. The Municipality was not able to conduct physical inventory of its Property, Plant

and Equipment (PPE) account valued at P85,194,100.13 which was not in consonance with the provision of Section 124 of Manual in the New Government Accounting System, Vol. I.; hence, accuracy, existence and validity of the account could not be determined. In addition, Memorandum Receipts (MR), now Property Acknowledgement Receipts (PAR) were not renewed every after three years of issue which was not in keeping with Section 492 of the Government Accounting and Auditing Manual (GAAM). We recommended that management create an Inventory Committee, require the conduct of physical inventory of the Property, Plant and Equipment of the Municipality and to prepare the inventory report which shall be reconciled with the accounting records. We also recommended that the Municipal Accountant should maintain a complete property ledger card for each account of the Property, Plant and Equipment with complete details to facilitate inventory-taking and reconciliation with the inventory report. Moreover, Property Acknowledgement should be prepared for every property issued to employees and renewed every after three years of issue.

2. Cash advances granted to municipal officials and employees amounting to P196,021.00 have remained unliquidated as of December 31, 2011 which was not in consonance with the provision of COA Circular No. 97-002 dated February 10, 1997.

We recommended that management require the municipal officials and employees concerned to immediately settle/liquidate their cash advances in consonance with above-cited provisions of rules and regulations.

3. The Municipality was not able to collect real property taxes from delinquent taxpayers amounting to P35,371,744.80, thus, depriving the agency of generating additional income that could had been used to finance development programs and projects for the welfare of the constituents.

We recommended that management exert more efforts to collect the delinquent real property taxes from taxpayers in order to generate more income which could be used to meet its obligation or implement beneficial programs and projects. We also recommended that management conduct tax campaign and seek the assistance of the barangay officials in their respective barangays.

4. Stall rentals amounting to P122,900.00 were not collected by the Municipality

from stallholders, thereby depriving the agency of realizing additional income which could had been used in the implementation of projects/programs beneficial to the constituents. We recommended that management exert more efforts to collect the delinquent stall rentals from the stall holders which could be used to implement development programs/projects for the benefit of the constituents.

The other audit findings and the corresponding recommendations were discussed

in Part II of this report.

STATUS OF IMPLEMENTATION OF PRIOR YEAR’S AUDIT RECOMMENDATIONS

Of the six audit recommendations embodied in the 2010 Annual Audit Report, only one was partially implemented while five were not implemented by the Municipality.