commonwealth avenue, quezon city · 2017-07-03 · 4.1.2 national irrigation administration (nia)...

Republic of the Philippines

COMMISSION ON AUDITCommonwealth Avenue, Quezon City

Principal Interest Guaranty Fees Commitment Fees Other Charges Total

2015 42.12 10.02 0.59 0.15 0.37 53.25

2016 45.27 12.98 0.66 0.17 2.05 61.12

45.27

12.98 0.66 0.17 2.05

61.12

42.12

10.02

0.59 0.15 0.37

53.25

-

20.00

40.00

60.00

80.00

100.00

120.00

140.00

Debt service

2016

Consolidated Audit Report

on

Official Development Assistance

Programs and Projects

TABLE OF CONTENTS Page

1.0 INTRODUCTION

Legal Basis 1

Scope and Sources 2

Methodology 4

2.0 HIGHLIGHTS OF THE REPORT 6

3.0 STATUS OF ODA-FUNDED PROJECTS

Cumulative Gross Loan Commitments 10

Availments 13

Undrawn Commitments 19

Repayments 22

Debt Service Expenditures 25

Outstanding Balances 28

4.0 AUDIT OBSERVATIONS AND RECOMMENDATIONS 33

4.1 Agency- specific and Common Audit Observations and Recommendations

4.1.1 Department of Social Welfare and Development (DSWD) 35

4.1.2 National Irrigation Administration (NIA) 44

4.1.3 Department of Agriculture (DA) 51

4.1.4 Department of Environment and Natural Resources (DENR) 60

4.1.5 Department of Agrarian Reform (DAR) 66

4.1.6 Department of Transportation (DOTr) 70

4.1.7 Municipal Development Fund Office 74

4.2 Common Audit Observations of Other Agencies with ODA Loans 77

4.3 General Audit Recommendations 82

4.4 Status of Implementation of Prior Years’ Audit Recommendations 84

5.0 CHART

I Loan Structure by Sector and Creditor Type indicating the number of Loans Contracted and CNLC

3

II Loan Status 6

III CGLC, Cancellations and CNLC 6

IV Schedule of Availments and Undrawn Balances by Type of Creditor

7

V Loan Availments, Repayment & Balances by Type of Creditor 8

VI Comparative Repayments in relation to Availments 22

VII Debt Service Expenditures 25

VIII Outstanding Balance by Creditor Type 29

IX Number of Loans and Outstanding Balances by Sector 30

6.0 TABLES

I Status and Breakdown of Loans 3

II Current and Cumulative Loan Availments by Project and Government Sectors

7

III Debt Service Expenditures by Creditor Type 8

IV Debt Service Expenditures by Sector 9

V Commitment Fees Paid by Type of Creditors and Loans 9

VI List of New ODA Loans 10

VII VIII

Schedule of Cumulative Net Loan Commitment by Creditor Schedule of Cumulative Net Loan Commitment by Sector

11 11

IX Schedule of CNLC by Implementing Agency 12

X Cumulative and Current Availments by Creditor 14

XI Cumulative and Current Year Availments by Project Sector 15

XII Cumulative and Current Year Availments by IA 15 XIII Programs and Projects for Implemention by Various IAs out of

CY Availments 17

XIV Schedule of Loans with Undrawn Balances by Creditor 19

XV Schedule of Undrawn Balances by Project Sector 21

XVI Schedule of IA with Undrawn Balances 21

XVII Cumulative and Current Repayment by Creditor 22

XVIII Cumulative and Current Year Repayment by Project Sector 24

XIX Cumulative and Current Year Repayments by IA 24

XX Debt Service Expenditures by Creditor 26

XXI Debt Service Expenditures by Implementing Agencies 27

XXII Debt Service Expenditures by Project Sector 28

XXIII Changes on Loan Outstanding Balance 28

XXIV Outstanding Balances by Specific Creditor 29

XXV Five Loans under each Project Sector with big Outstanding Balances

31

XXVI Outstanding Balances by Government Sector 32

XXVII Outstanding Balances by IAs 32

XXVIII DSWD - Project Status and Loan Summary Profile 36

XXIX DSWD - List of Project Loans with Audit Observations 36

XXX NIA - Project Status and Summary of Loans Profile 44

XXXI NIA - List of Project Loans with Audit Observations 44

XXXII DA - Project Status and Loan Summary Profile 52

XXXIII DA - List of On-going Projects with Audit Observations 52

XXXIV DENR - Project Status and Loan Summary Profile 61

XXXV DENR - List of Project Loans with Audit Observations 61

XXXVI DAR - Project Status and Loan Summary Profile 66

XXXVII DAR - List of On-going Projects with Audit Observations 66

XXXVIII DOTr - Project Status and Loan Summary Profile 71

XXXIX DOTr - List of On-going Projects with Audit Observations 71

XL MDFO - Project Status and Loan Summary Profile 75

XLI MDFO - List of On-going Projects with Audit Observations 75

4 Ps Pantawid Pamilyang Pilipino ProgramAARNR Agriculture, Agrarian Reform and Natural ResourceABC Approved Budget for the ContractACSP Agricultural Credit Support Project ADB Asian Development BankAFD Agence Française de Développement ANF Air Navigation Facilities ANZ/EFIC Australia New Zealand/Export Finance & Insurance CorporationAO Accountable OfficerARBP PH II Arterial Road Bypass Project, Phase IIARBs Agrarian Reform BeneficiariesARCP II Agrarian Reform Communities Project IIARE Acknowledgement Receipt for EquipmentARIIP Agno River Integrated Irrigation Project ARMM Autonomous Region of Muslim MindanaoARISP Agrarian Reform Infrastructure Support ProjectBAC Bids and Awards CommitteeBCDA Bases Conversion and Development AuthorityBCRP Bridge Construction and Replacement ProjectBFAR Bureau of Fisheries and Aquatic ResourcesBFP Bureau of Fire ProtectionBIR Bureau of Internal RevenueBOC Bureau of CustomsBPIP Banaoang Pump Irrigation Project BRS Bank Reconciliation StatementBSP Banko Sentral ng PilipinasBSPMC Barangay Sub-project Management CommitteeBTr Bureau of the TreasuryCARP Comprehensive Agrarian Reform ProgramCAs Cash AdvancesCBFMMP Community-Based Forest and Mangrove Management Project CBRT Cebu Bus Rapid TransitCCDF Climate Change Defence FundCDD Community-driven DevelopmentCEMTSMMP Capacity Enhancement of Mass Transit Systems in Metro Manila ProjectCEXIM The Export-Import Bank of ChinaCFL Compact Fluorescent LampsCHARM Cordillera Highland Agricultural Resource ManagementCHI-I China National Construction and Agriculture Machinery ICIB-LCCA Cash in Bank – Local Currency, Current AccountCIP Construction In ProgressCIS Communal Irrigation SystemsCGLC Cumulative Gross Loan CommitmentCNLC Cumulative Net Loan CommitmentCNS/ATM Communication, Navigation, Surveillance/Air Traffic ManagementCO Central OfficeCOA Commission on AuditCSC Civil Service CommissionCTEs Contract Time ExtensionsCV-CERGEP Convergence on Value-Chain Enhancement for Rural Growth and

Empowerment ProjectDA Department of AgricultureDAR Department of Agrarian ReformDARPO Department of Agrarian Reform Provincial OfficeDBM Department of Budget and Management DBP Development Bank of the PhilippinesDENR Department of Environment and Natural ResourcesDepEd Department of EducationDIADP Davao International Airport Development Project

LIST OF ACRONYMS

LIST OF ACRONYMS

DILG Department of Interior and Local GovernmentDMAD Debt Monitoring and Analysis Division DOE Department of EnergyDOF Department of FinanceDOH Department of HealthDOT Department of TourismDOTr Department of TransportationDPWH Department of Public Works and HighwaysDSWD Department of Social Welfare and DevelopmentDTI Department of Trade and IndustryDVs Disbursement VouchersECGD Export Credit Guarantee Department - Deutsche BankEDC Export Development CorporationEIB European Investment BankEISCP Environmental Infrastructure Support Credit ProgramE-Trike Project Energy Efficient Electric Vehicles Project EMB Environmental Management BureauENP Emergency Network ProjectEU-HSPSP EU-Health Sector Policy Support ProgrammeFDS Family Development SessionsFFIs Foreign Funding InstitutionsFFUCQC Final Firmed Up Contract Quantity and Cost FMP Forest Management ProjectFO Field OfficeFP Family PlanningFRIMP Flood Risk Management ProjectFXRC Foreign Exchange Risk CoverGAA General Appropriations ActGAM Government Accounting ManualGCF General Control FundGL General LedgerGOCCs Government Owned and Controlled CorporationsGPPB Government Procurement Policy BoardGSFORP II Gapan-San Fernando-Olongapo Road Project, Phase IIGSIS Government Service Insurance SystemHCAAP Help for Catubig Agricultural Advancement ProjectHSRASP Health Sector Reform Agenda Support ProgrammeHSRP Health Sector Reform ProjectIARCDSP Italian Assistance to the Agrarian Reform Community Development Support

ProgramIBRD International Bank for Reconstruction and DevelopmentICRM Integrated Coastal Resources Management ICRMP Integrated Coastal Resources Management Project ICO Instituto de Credito OfficialIFAD International Fund for Agricultural DevelopmentInfra InfrastructureIIRUP Inventory and Inspection Report of Unserviceable PropertyIMOs Irrigation Management OfficesINREMP Integrated Natural Resources and Environmental Management ProjectIRP Invoice Receipt of Property

IRR Implementing Rules and RegulationsIT Information TechnologyITT Industry, Trade and TourismIWG Infrastructure Working GroupJBIC Japan Bank for International CooperationJEV Journal Entry VoucherJEXIM Export-Import Bank of Japan JFA Jordan Forearms AssociationJICA Japan International Cooperation Agency

http://en.wikipedia.org/w/index.php?title=Export-Import_Bank_of_Japan&action=edit&redlink=1

LIST OF ACRONYMS

JRMPP Jalaur River Multi Purpose Project StageKALAHI-CIDSS Kapit-Bisig Laban sa Kahirapan-Comprehensive and Integrated Delivery of

Social Services KBC Bank Kredietbank ABB Insurance CERA BankKC-AF KALAHI CIDSS - Additional FinancingKC-NCDDP KALAHI CIDSS - National Community-Driven Development ProjectKEXIM Export-Import Bank of KoreaKFAED Kuwait Fund for Arab Economic DevelopmentKFW Kreditanstalt für WiederaufbauLAAN Laguindingan Airport Air NavigationLAF Livelihood Assistance FundLAMP 2 Second Land Administration and Management ProjectLBP Landbank of the PhilippinesLCB Lowest Calculated BidLCCA Local Currency Current AccountLCCA-LGU CC Local Currency Current Account-Local Government Unit Counterpart

CommitmentLDU Liquid Display UnitsLED Light-emitting DiodeLGUs Local Government UnitsLIGs Livelihood Interest GroupsLLDA Laguna Lake Development AuthorityLOGO FIND Local Government Finance and Development ProjectLRT Light Rail TransitLRTA Light Rail Transit AuthorityLSWDO Local Social Welfare and Development OfficesLWUA Local Water Utilities AdministrationMARINA Maritime Industry Authority

MBURD Mega Bridges for Urban and Rural DevelopmentMDFO Miunicipal Development Fund OfficeMDS Modified Disbursement SystemMINSAADP Mindanao Sustainable Agrarian and Agriculture Development ProjectMOA Memorandum of AgreementMRFC Monthly Reports of Fuel ConsumptionMRIP Mindanao Roads Improvement ProjectMROT Monthly Report of Official TravelsMSIP III Maritime Safety Improvement Project, Phase 3MSSP Manila Second Sewerage ProjectMNWSDP MWSS New Water Source Development ProjectMWSS Manila Water and Sewerage SystemNAMRIA National Mapping and Resource Information AuthorityNBAC-SEPP New Bohol Airport Construction and Sustainable Environmet Protection Project NCA Notice of Cash AllocationNCAA Non-Cash Availment AuthorityNDF Nordic Development FundNEDA National Economic Development Authority NFA National Food AuthorityNG National Government NGAs National Government AgenciesNGAS New Government Accounting SystemNGDAD National Government Debt Accounting Division NGOs/POs Non-Governmental Organizations/Peoples' OrganizationNIA National Irrigation Administration NIS National Irrigation SystemsNISRIP National Irrigation Sector Rehabilitation and Improvement Project NLRC North Luzon Railway CorporationNPAB National Projects Advisory BoardNPC National Power Corporation

LIST OF ACRONYMS

NPS-ENRMP National Program Support for Environment and Natural Resources

Management Project

NRIMP National Roads Improvement and Management Project NTA Notice of Transfer of AllocationNYI Not Yet ImplementedO&M Operations & Maintenance

OCM Overhead, Contingencies and MiscellaneousODA Official Development AssistanceOECF Overseas Economic Cooperation FundOP Office of the PresidentOPEC Organization of the Petroleum Exporting CountriesORs Official ReceiptsOTC Over the CounterPAD Project Appraisal Document PAS Philippine Accounting StandardsPCG Philippine Coast Guard PD Presidential DecreePEEP Philippine Energy Efficiency ProjectPEZA Philippine Economic Zone AuthorityPHUMP III Pinatubo Hazard Urgent Mitigation Project, Phase IIIPIA PHIVIDEC Industrial AuthorityPIDP Participatory Irrigation Development ProjectPMMA Philippine Merchant Marine AcademyPMO Project Monitoring OfficePMR Procurement Monitoring ReportPMU Project Monitoring UnitPNOC Philippine National Oil CorporationPNR Philippine National RailwaysPOPSTIRP Pepeng Short-Term Infrastructure Rehabilitation ProjectsPPA Philippine Ports AuthorityPPE Property, Plant and Equipment PPCGCDP Philippine Ports and Coast Giard Capability Development ProjectPPIADP Puerto Princesa Airport Development ProjectPPRPC Pantawid Pamily Regional Program CoordinatorPRDP Philippine Rural Development ProjectPRRC Pasig River Reconstruction Commission PSALM Power Sector Assets and Liabilities ManagementPSO Project Support OfficePTA Philippine Tourism AuthorityPWDs Persons with DisabilitiesPWU Provincial Women's UnionQPRO Quarterly Physical Report of OperationRA Republic ActRD Regional DirectorRIIDP Road Improvement and Institutional Development ProjectROW Right-of-WayRPCI Report on the Physical Count of InventoryRPCPPE Report on the Physical Count of Property, Plant and Equipment RPMO Regional Project Management OfficeRSMI Report of Supplies and Materials IssuedRUPP Road Upgrading & Preservation ProjectRZOA Raiffeissen Zentralbank Osterreich AktiengeselschaftSADP PH I Selected Airports Development Project, Phase ISARO Special Allotment Release OrderSBC Small Business CorporationSBGFC Small Business Guarantee and Finance CorporationSBMA Subic Bay Metropolitan AuthoritySC Supreme CourtSCHARMP Second Cordillera Highland Agricultural Resource Management Project

LIST OF ACRONYMS

SDO Special Disbursing OfficerSEC Securities and Exchange Commission

SFD Saudi Fund for DevelopmentSIDA INEC Swedish International Cooperation Agency - Ilocos Norte Electric CooperativeSILCAB Social Infrastructure and Local Capability BuildingSL Subsidiary Ledger SPs Sub-ProjectsSPSO State Programme Support OfficesSPSP Social Protection Support ProjectSPISP Southern Philippines Irrigation Sector ProjectSRCD Social Reform and Community DevelopmentSREs Statement of Receipts and Expenditures

SRPMO Sub-Regional Project Management Office

SRRDP Social Reform Related Feeder Ports Development ProjectsSSAF Sources and Application of Funds

SSC Staff Selection Committee SUSIMO Sub-project Site Management Office

SWD Social Welfare and DevelopmentSWDRP Social Welfare and Development Reform ProjectTADP Third Airports Development Project TEEP Third Elementary Education ProjectTESDA Technical Education and Skills Development AuthorityTRA Tax Remittance AdviceTSPs Technical Service ProvidersTWG Technical Working GroupUBCPRD Urgent Bridges Construction Project-Rural Development UP/PGA University of the Philippines/Participatory Governance AssessmentUSPL U.S. Public LawUATP Umiray-Angat Transbasin ProjectUBCPRD Urgent Bridges Construction Project-Rural DevelopmentVCA Value Chain AnalysisWHO FCTC World Health Organization Framework Convention on Tobacco Control

1.0 INTRODUCTION

1

CONSOLIDATED AUDIT REPORT ON OFFICIAL DEVELOPMENT ASSISTANCE

FOR THE CALENDAR YEAR 2016

1.0 INTRODUCTION

1.1 Legal Basis

Official Development Assistance is governed by Republic Act (RA) No. 8182, approved on June 11, 1996 as amended by RA No. 8555, approved on February 26, 1998, entitled:

The law was issued to facilitate the absorption and optimize the utilization of ODA

resources. It also excluded ODA loans from foreign debt limit of US$10 billion or its equivalent in other foreign currencies as set under Presidential Decree (PD) No. 1939, the law amending RA No. 4860. The ODA loan remains the preferred source of financing priority development projects of the country due to its lower interest rate and longer maturity periods compared to other foreign loans.

Under Section 2 of RA 8182, ODA is defined as a loan, or a loan and grant, which

meets all of the following criteria:

a. It must be administered with the objective of promoting sustainable social and economic development and welfare of the Philippines;

b. It must be contracted with governments of foreign countries with whom the

Philippines has diplomatic, trade relations or bilateral agreements or which are members of the United Nations, their agencies and international or multilateral lending institutions;

c. There are no available comparable financial instruments in the capital market;

and

d. It must contain a grant element of at least twenty-five percent (25%). Grant element is the reduction enjoyed by the borrower whenever the debt service payments which shall include both principal and interest and expressed at their present values discounted at ten percent (10%) are less than the face value of the loan or loan and grant. The grant element of a loan or loan and grant is computed at the ratio of (i) the difference between the face value of the loan or loan and grant and the debt service payments to (ii) the face value of the loan or the loan and grant.

Public debt is governed by RA No. 4860, issued on August 8, 1966. Under Section

1 of this Act, the President of the Philippines is authorized, in behalf of the Republic of the Philippines, to contract such loans, credits and indebtedness with foreign governments, agencies or instrumentalities of such foreign governments, foreign financial institutions, or

“An Act Excluding Official Development Assistance (ODA) from the Foreign Debt Limit in order to Facilitate the Absorption and Optimize the Utilization of ODA Resources, Amending for the Purpose Paragraph 1, Section 2 of RA No. 4860, as amended”.

2

other international organizations, with whom, or belonging to countries with which, the Philippines has diplomatic relations, as may be necessary and upon such terms and conditions as may be agreed upon, to enable the Government of the Republic of the Philippines (ROP) to finance, either directly or through any government office, agency or instrumentality or any government-owned or controlled corporations, industrial, agricultural or other economic development purposes or projects authorized by law. It is also provided in this section that the authority of the President of the Philippines shall include the power to issue, for the purposes herein before stated, bonds for sale in the international markets the income from which shall be fully tax-exempt in the Philippines.

The total amount of loans, credits and indebtedness, excluding interests, which the

President is authorized to incur, as provided under Section 2 thereof, shall not exceed US$1 billion or its equivalent in other foreign currencies at the exchange rate prevailing at the time the loans, credits and indebtedness are incurred, provided that the total loans, credit and indebtedness incurred shall not exceed US$250 million or its equivalent in other currencies in the fiscal year of the approval of the Act, and US$250 million or its equivalent in other currencies every fiscal year thereafter.

The foreign debt limit was, however, increased under PD No. 1939 issued on June

27, 1984 amending RA No. 4860 to an amount not exceeding US$10 billion or its equivalent in other foreign currencies at the exchange rate prevailing at the time the loans, credits or indebtedness are incurred at terms of payment of not less than 10 years except those contracted in the interest of national security and rehabilitation resulting from natural calamities. Section 2 of PD No. 1939 further amended the last paragraph of Section 3 of RA 4860 to read as follows:

The President, under Section 20, Article VII, of the 1987 Philippine Constitution, may

also contract or guarantee foreign loans in behalf of the Philippines with the prior concurrence of the Monetary Board, and subject to such limitations as may be provided by law. The Monetary Board shall, within thirty days from the end of every quarter of the calendar year, submit to Congress a complete report of its decision on applications for loans to be contracted or guaranteed by the Government or government-owned and controlled corporations (GOCC) which would have the effect of increasing the foreign debt, and containing other matters as may be provided by law.

1.2 Scope and Sources

1.2.1 The report contains data on 449 ODA loans consisting of 71 program loans and 378 project loans contracted and guaranteed by the National Government (NG) from January 1, 1995 to December 31, 2016. Project loans are foreign loans obtained to finance specific projects. On the other hand, Program loans are multi-purpose foreign loans not intended to finance specific projects, but are conditioned on basic changes

“The total amount of loans, credits or indebtedness incurred, and the proceeds of bonds, securities or other evidences floated or issued, which may be guaranteed by the President under this Section shall not be more than US$7.5 billion or its equivalent in other foreign currencies at the exchange rate prevailing at the time the guarantee is made excluding interests and other normal banking charges imposed or charged by the International Bank for Reconstruction and Development (IBRD), the Asian Development Bank (ADB) and other similar international financial institutions”.

3

in economic, monetary or fiscal policies, among others. RA No. 8182, as amended by RA No. 8555 which applies only to loans contracted from January 1, 1995 onward.

The status and breakdown of 449 ODA loans with cumulative net loan commitment (CNLC) 1amounting to P1.83 trillion (US$36.69 billion) are presented in Table I.

1.2.2 The loans were obtained from bilateral, multilateral and commercial creditors and utilized for various projects under the Sector of Infrastructure (Infra); Social Reform and Community Development (SRCD); Industry, Trade and Tourism (ITT); Agriculture, Agrarian Reform and Natural Resource (AARNR); and Governance and Institutions Development (GID). The graphical presentation of the loan structure by Sector and Creditor Type are shown in Chart 1.

Chart 1 – Loan Structure by Sector and Creditor Type indicating the number of Loans Contracted and CNLC

1 The specified amount of loan or line of credit made available to the named borrower at a certain interest rate, during a certain period and, usually,

for a certain purpose. The cumulative net loan commitment (CNLC) is the amount of loan commitments after deducting the amount of commitments

cancelled as of the given period.

Program Project Total USD PHP

4 45 49 9.16 456.12

5 6 11 2.13 105.86

4 6 10 2.07 103.25

1 1 0.05 2.60

62 320 382 25.43 1,265.49

0 7 7 0.03 1.35

71 378 449 36.75 1,828.82

USD 14.52 22.23

PHP 722.60 1,106.23

Difference between totals and sum of components is due to rounding off

Cancelled

Total

CNLC (in billion) 36.75

1,828.82

Closed

Table I – Status and Breakdown of Loans

StatusBreakdown

CNLC

(in billion)

Newly Signed/Closed

Active

New:

Newly Signed/ Effective

4

(Chart I, continued)

1.2.3 The data are sourced from the following:

a) Status Report on NG Direct and Guaranteed Loans prepared by the Debt

Monitoring and Analysis Division (DMAD), Bureau of the Treasury (BTr) showing the details of foreign loans by loan account number, creditor and implementing agency with summary on the type of loans and creditors.

b) List of ODA loans signed during the year forwarded to the Commission on Audit

(COA) by the Department of Finance (DOF) and Status of Loans submitted by the National Economic Development Authority (NEDA).

c) Summary of Debt Service Expenditures - Foreign prepared by the National

Government Debt Accounting Division (NGDAD), BTr showing payments by the NG broken down into Principal, Interests, Commitment Fees and Other Charges for the Direct and Relent Loans.

d) Actual Debt Service, ODA - Funded Projects prepared by concerned GOCCs

showing direct payments by the GOCCs to their creditors for the NG Guaranteed loans.

1.2.4 The Project Status and Consolidated Audit Observations and Recommendations as

of December 31, 2016 are based on the reports submitted by the concerned auditors of the implementing agencies.

The above table does not include Foreign-Assisted Projects (FAPs) funded from ODA grants.

1.3 Methodology

COA maintains database on ODA loans which is updated annually based on the Status Report submitted by the DMAD BTr, the list of new loans submitted by DOF, the status of loans extracted from NEDA Report and project status as reported by the implementing agencies (IAs).

Based on updated database file, COA prepares schedules of ODA loans by creditor,

sector and IA indicating the data on commitments, availments, repayments, and undrawn and outstanding balances per loan account and project. COA adopted the sectoral classifications of loans/projects being used by NEDA. The data are presented in tables and charts with narrative discussion.

All balances were translated to local currency equivalent using the BSP weighted

average rate at reporting date which was published on the first working day of the ensuing

US$ PHP

Bilateral 44 6 11 137 19 217 86.54 41.35 35.17 616.99 48.29 16.64 828.34

Commercial 8 1 1 37 12 59 11.39 1.07 0.31 55.02 7.94 1.52 75.73

Multilateral 42 16 13 52 50 173 104.33 174.31 33.12 176.13 436.86 18.58 924.75

Total PhP 94 23 25 226 81 449 202.27 216.72 68.60 848.14 493.09 36.75 1,828.82

4.06 4.35 1.38 17.04 9.91 36.75

Sources

Infra. SRCDTotal

Total US$

Total

CNLC by Sector and Creditor Type

(in billion PHP)

AARNR GID ITT Infra. SRCD AARNR GID ITT

Number of Loans Contracted

by Sector and Creditor Type

5

year. Third currency balances are first converted to US Dollars (USD) before translating to Philippine Peso (PhP) using the exchange rate at reporting date.

Considering the provisions under Section 8 (b) of RA No. 8182, as amended,

mandating COA to conduct an audit of ongoing and completed projects and submit report to Congress, COA directed Auditors of the National Government Agencies (NGAs), GOCCs and Local Government Units (LGUs) implementing ODA funded projects to undertake the audit of said projects and submit their ODA Audit Report to their Cluster and Sector head for consolidation. The consolidated report are required to be submitted to the Office of the Assistant Commissioner, National Government Sector (NGS), for preparation of overall consolidated Audit Report on ODA Funded Projects. The consolidated audit observations and recommendations were grouped into audit issues for emphasis.

2.0 HIGHLIGHTS OF THE REPORT

6

2.0 HIGHLIGHTS OF THE REPORT

The NG contracted 449 ODA loans (including seven cancelled loans), from 1995 to 2016, with Gross Commitments of P2.01 trillion (US$40.42 billion) and CNLC of P1.83 trillion (US$36.75 billion) for financing 404 programs and projects of the Government. Of the total, P1.37 trillion (US$27.51 billion), representing 74.86 percent, were availed as of December 31, 2016, leaving total undrawn amount of P459.75 billion (US$9.24 billion). The undrawn amount represents 25.14 percent of the CNLC. On the other hand, of the total amount availed of P1.37 trillion (US$27.51 billion) as of December 31, 2016, cumulative repayment as of the same period amounted to P498.80 billion (US$10.02 billion) leaving outstanding balance of P870.27 billion (US$17.49 billion). Debt Service expenditures for 2016 amounted to P61.12 billion inclusive of interest of P12.98 billion, commitment fee of P165.94 million, guaranty fee of P658.42 million and other charges of P2.05 billion.

Chart II – Loan Status (in billion PhP)

CGLC CLC CNLC CNLC

Cum.

Availments

Undrawn

Balances

Cum.

AvailmentsRepayments

Outstanding

Balances

Amount 2,011.79 182.96 1,828.82 1,828.82 1,369.07 459.75 1,369.07 498.80 870.27

Percentage 100.00 9.09 90.91 100.00 74.86 25.14 100.00 36.43 63.57 In 2016, 11 ODA loans were contracted with net loan commitments of P105.86 billion

(US$2.13 billion). Of the net loan commitments, only P2.78 billion (US$55.95 million) were availed leaving undrawn amount of P103.07 billion (US$2.07 billion). This amount represents 97.37 percent of the total net loan commitments for the loans contracted during the year for which the NG paid P14.98 million commitment fees during the year.

Of the 404 programs and projects financed out of these loans, 328 were completed, 53

are on-going, 11 are yet to be started, while 12 were cancelled.

2.1 Gross Commitments – P2.01 trillion (US$40.42 billion)

The cumulative gross loan commitments (CGLC) from 449 ODA loans as of December 31, 2016 amounted to P2.01 trillion or US$40.42 billion. Of the amount, P182.96 billion (US$3.68 billion) or 9.09 percent was cancelled leaving CNLC of P1.83 trillion (US$36.75 billion) as graphically presented in Chart III.

Chart III – CGLC, Cancellations and CNLC (in billion PhP)

7

(Chart III, continued)

US$ PHP US$ PHP US$ PHP

1 Bilateral 217 18.46 918.62 1.81 90.28 16.64 828.34 45.29

2 Commercial 59 1.81 90.12 0.29 14.39 1.52 75.73 4.14

3 Multilateral 173 20.15 1,003.05 1.57 78.29 18.58 924.75 50.57

449 40.42 2,011.79 3.68 182.96 36.75 1,828.82 100.00


Total

% to CGLC 100.00 9.09 90.91

Creditor Type No. of

Loan

CGLC Cumulative Loan

Cancellation CNLC % to

Total

2.2 Availments – P1.37 trillion (US$27.51 billion)

ODA loans availed by the Government were intended to implement programs and projects of the different sectors. Total cumulative availments from 442 loan accounts (excluding cancelled loans) as of December 31, 2016 amounted to P1.37 trillion (US$27.51 billion). Of the total availments, P60.06 billion (US$1.21 billion) were availed in CY 2016. The current year and cumulative loan availments by creditor type, and distribution by project and government sectors are presented in Table II.


0.09 4.62 1 AARNR 0.08 3.93 6.54

2 GID 0.00 0.12 0.21

3 ITT 0.00 0.11 0.19

4 Infra. 0.30 15.00 24.98

1.11 55.44 5 0.82 40.89 68.08

Total 1.21 60.06 100.00 Total 1.21 60.06 100.00 Total 1.21 60.06 100.00

1 AARNR 3.21 159.77 11.67

2 GID 3.84 190.89 16.80

3 ITT 1.38 68.46 5.00

4 Infra. 11.09 551.70 40.30

5 8.00 398.25 29.09

Total 27.51 1,369.07 100.00 Total 27.51 1,369.07 100.00 Total 27.51 1,369.07 100.00

SRCD

Creditor Type Amount % to

Total

Go vern-

ment

Secto r

Amount % to

Total

Table II- Current and Cumulative Loan Availments by Project and Government Sectors (in billion)Sources Distribution

Project

Sector

Amount % to

Total

2016 Availments

1Bilateral 0.28 13.80 22.98 1 GOCCs

2Commercial -

7.70

3 Multilateral 0.93 46.26 77.02 3 NGAs

2 LGUs -

SRCD

Cumulative Availments

1Bilateral 11.48 571.13 41.72 1 GOCCs 6.40

92.30

318.55 23.27

75.98

10.29 0.75

3 Multilateral 14.53 723.36 52.84 3 NGAs 20.90

2Commercial 1.50 74.58 2 LGUs 0.21

1,040.23

5.45

2.3 Undrawn Commitments – P459.75 billion (US$9.24 billion)

The undrawn commitments of P459.75 billion (US$9.24 billion) as of December

31, 2016 represents 25.14 percent of the CNLC. Shown in Chart IV is the graphical presentation of CNLC, in relation to availments and undrawn balances as of December 31, 2016, summarized by type of creditor.

Chart IV- Schedule of Availments and Undrawn Balances by Type of Creditor (in billion peso)

8

(Chart IV, continued)


1 Bilateral 16.64 828.34 11.48 571.13 68.95 5.17 257.21 31.05

2 Commercial 1.52 75.73 1.50 74.58 98.48 0.02 1.15 1.52

3 Multilateral 18.58 924.75 14.53 723.36 78.22 4.05 201.40 21.78

36.75 1,828.82 27.51 1,369.07 74.86 9.24 459.75 25.14 Total

Creditor Type CNLC

Cumulative

Availments % to

CNLC

Undrawn

Commitments % to CNLC

2.4 Repayments – P498.80 billion (US$10.02 billion) and Outstanding Balances– P870.27 billion (US$17.49 billion)

Out of the cumulative availments of P1.37 trillion (US$27.51 billion), P498.80 billion (US$10.02 billion) was already repaid with outstanding balances of P870.27 billion (US$17.49 billion). These represent balances from 328 loan accounts out of 442 total loan (net of cancelled loans) accounts.

Shown in Chart V are the loan cumulative Availments, Repayments and Balances

as of December 31, 2016, summarized by type of creditor.

Chart V - Loan Availments, Repayment & Balances by Type of Creditor

(in billion peso)


1 Bilateral 11.48 571.13 4.42 219.75 38.48 7.06 351.38 61.52

2 Commercial 1.50 74.58 1.05 52.11 69.87 0.45 22.47 30.13

3 Multilateral 14.53 723.36 4.56 226.94 31.37 9.97 496.42 68.63

27.51 1,369.07 10.02 498.80 36.43 17.49 870.27 63.57 Total

Creditor Type

Cumulative

Availments Repayments

% to

Avail-

ments

Outstanding

Balances % to

A vailments

2.5 Debt Service Expenditures for the year – P61.12 billion

During the year, the total debt service payments to creditors amounted to P61.12 billion inclusive of interest, commitment fees and other charges as presented in Table III.

Principal Interest Commit-

ment Fees

Guaranty

Fee

Other

Charges Total

% to

Total

1 Bilateral 18,495.99 4,961.68 77.37 517.26 1,770.22 25,822.52 42.25

2 Commercial 2,767.73 797.18 5.77 24.78 26.94 3,622.39 5.93

3 Multilateral 24,011.26 7,218.06 82.81 116.38 250.61 31,679.12 51.83

45,274.97 12,976.92 165.94 658.42 2,047.77 61,124.03 100.00

74.07 21.23 0.27 1.08 3.35 100.00

Table III- Debt Service Expenditures by Creditor Type (in million peso)

Creditor Type

Total

% to total

9

By Project Sector, 36.79 percent of debt service expenditures represent repayment to loans falling under infrastructure sector as shown in Table IV.

Principal Interest Commit-

ment Fees

Guaranty

Fee

Other

Charges Total

% to

Total

1 AARNR 6,760.10 1,903.06 19.25 48.50 227.13 8,958.04 14.66

2 GID 9,745.24 2,110.15 1.30 - 293.74 12,150.42 19.88

3 ITT 3,882.59 502.57 0.53 71.67 58.29 4,515.64 7.39

4 Infra. 16,312.36 4,196.15 102.60 538.24 1,340.32 22,489.67 36.79

5 SRCD 8,574.69 4,265.00 42.26 - 128.30 13,010.25 21.29

45,274.97 12,976.92 165.94 658.42 2,047.77 61,124.03 100.00

74.07 21.23 0.27 1.08 3.35 100.00

Table IV - Debt Service Expenditures by Sector (in million peso)

Sector

Total

% to total

The difference between the totals and the sum of the components is due to rounding off

Commitment fees paid during the year alone for the undrawn balance amounted to P165.94 million or 0.04 percent of the total undrawn balances of P459.75 billion as presented in Table V.

NG Direct NG-

Guaranteed

NG

Relent Total

1 Bilateral 257,209.17 66.65 10.71 - 77.37 0.03

2 Commercial 1,149.64 5.77 - - 5.77 0.50

3 Multilateral 201,395.01 82.28 0.53 - 82.81 0.04

459,753.83 154.70 11.24 - 165.94 0.04

93.23 6.77 0.00 100.00

Table V- Commitment Fees Paid by Type of Creditors and Loans (in million pesos)

Total

Percentage to total

Creditor TypeUndrawn

Balance

Commitment Fees % to Undrawn

balance

2.6 Audit Observations and Recommendations

The audit observations and recommendations, summarized and presented

either separately as agency-specific or grouped together by audit issues or by nature of deficiencies were presented in Part 4. Details are discussed in the Annual Audit Reports of the concerned Agency.

3.0 STATUS OF ODA LOANS –

FUNDED PROGRAMS AND

PROJECTS

10

3.0 STATUS OF ODA LOANS – FUNDED PROGRAMS AND PROJECTS

3.1 Cumulative Gross Loan Commitments (CGLC) – P2.01 trillion (US$40.42 billion)

As discussed earlier, of the 449 loans contracted by the NG as of December 31, 2016 with CGLC amounting to P2.01 trillion (US$40.42 billion), 11 loans amounting to P105.86 billion (US$2.13 billion), representing 5.26 percent, were secured and signed during the year.

The 11 new loans were secured by NGAs and GOCCs with 39.96 percent of the gross

commitment going to the DSWD for the Social Protection Support Project and Social Welfare Development and Reform Project 2. The projects to be financed from the new loans for implementation by eight NGAs and two GOCCs are tabulated in Table VIII.

During the year, no cancellation of the loan amount was made. 3.1.1 By Creditor

The CNLC on account of cancellations as of December 31, 2016 for each creditor is presented in Table VII.


TOTAL 2.13 105.86 100.00 0.06 2.78 100.00 2.07 103.07 100.00

Office of the Civil Defense (OCD) 0.05 2.60 2.46 0.05 2.60 93.52 - - 0.00

1 CPH 1020

01 J

EUR50M

Disaster Risk Reduction

and Management Facility SRDC AFD 0.05 2.60 100.00 0.05 2.60 - -

0.85 42.30 39.96 0.00 0.06 2.01 0.85 42.25 40.99

2 3369-PHI Social Protection Support

Project - Additional

Financing

ADB 0.40 19.91 47.06 - - 0.00 0.40 19.91 47.12

3 8584-PH Social Welfare

Development and Reform

Project 2

IBRD 0.45 22.40 52.94 0.00 0.06 100.00 0.45 22.34 52.88

Bureau of Fire Protection (BFP) 0.02 1.07 1.01 - - 0.00 0.02 1.07 1.04

4AG. No.

234.967

Capability Building Program,

Phase IIGID BAC 0.02 1.07 100.00 - - 0.02 1.07 100.00

Department of Finance (DOF) 0.50 24.88 23.51 0.00 0.12 4.47 0.50 24.76 24.02

5 8576-PH Second Disaster Risk

Management Development

Policy Loan w ith a

Catastrophe Deferred

Draw dow n Option

IBRD IBRD 0.50 24.88 100.00 0.00 0.12 100.00 0.50 24.76 100.00

Department of Public Works and Highways (DPWH) 0.10 4.98 4.71 - - 0.00 0.10 4.98 4.83

6 PHL-18 Panguil Bay Bridge Project Infra KEXIM 0.10 4.98 100.00 0.10 4.98 100.00

Bureau of Fisheries and Aquatic Resources (BFAR) 0.03 1.49 1.40 - - 0.00 0.03 1.49 1.44

7 C37-0A1 Integrated Marine

Environment Monitoring

System-Phase 2 (PHILO

AARNR

Natixis

(French

Gov't)

0.03 1.49 100.00 0.03 1.49 100.00

Department of the Interior and Local Government(DILG) 0.25 12.44 11.75 - - 0.00 0.25 12.44 12.07

8 3505-PHI Local Government Finance

and Fiscal Decentralization

Reform Program -

Subprogram 2

SRDC ADB 0.25 12.44 100.00 0.25 12.44 100.00

Department of Transportation (DOTr) 0.14 6.97 6.58 - - 0.00 0.14 6.97 6.76

9 PH-P263Maritime Safety Capability

Improvement Project IIInfra JICA 0.14 6.97 100.00 0.14 6.97 100.00

Metropolitan Waterworks and Sewerage System (MWSS) 0.12 6.14 5.80 - - 0.00 0.12 6.14 5.95

10 3377-PHI Angat Water Transmission

Improvement ProjectInfra. ADB 0.12 6.14 100.00 0.12 6.14 100.00

Local Water Utilities Administration (LWUA) 0.06 2.99 2.82 - - 0.00 0.06 2.99 2.90

11 3389-PHI Water District Development

Sector ProjectInfra. ADB 0.06 2.99 100.00 0.06 2.99 100.00

Table VI - List of New ODA Loans (in billion)Loan Account

NumberName of Project Sector

Cre-

ditor

Commitments % to

Total

Availments

SRDC

% to

Total

Undrawn Balance % to

Total

Department of Social Welfare and Development (DSWD)

11

USD PHP USD PHP USD PHP

Total Commitments449 40,422.49 2,011,786.93 3,676.23 182,962.15 36,746.26 1,828,824.78 100.00

Bilateral 217 18,457.71 918,621.57 1,813.99 90,280.61 16,643.71 828,340.97 45.29

1 JICA 123 14,598.23 726,539.41 1,418.79 70,611.71 13,179.44 655,927.70 35.87

2 ECGD 5 736.46 36,652.99 - - 736.46 36,652.99 2.00

3 BNP PARIBAS 4 1,017.24 50,627.25 328.97 16,372.63 688.27 34,254.62 1.87

4 KEXIM 15 660.62 32,878.45 13.30 662.16 647.32 32,216.29 1.76

5 AFD 4 377.96 18,810.59 - - 377.96 18,810.59 1.03

6 KFW 21 303.58 15,108.82 30.18 1,502.09 273.40 13,606.73 0.74

7 USPL 10 235.00 11,695.72 0.87 43.43 234.13 11,652.29 0.64

8 ICO 9 114.85 5,716.13 0.02 1.00 114.83 5,715.13 0.31

9 ANZ/EFIC 1 92.79 4,617.93 2.20 109.48 90.59 4,508.45 0.25

10 EFIC 3 89.48 4,453.57 0.22 10.82 89.27 4,442.75 0.24

11 FP 9 40.40 2,010.58 2.13 105.81 38.27 1,904.77 0.10

12 EIB 1 35.02 1,742.77 - - 35.02 1,742.77 0.10

13 Natixis (French Gov't)1 29.85 1,485.41 - - 29.85 1,485.41 0.08

14 Artigiancassa 1 27.41 1,364.06 - - 27.41 1,364.06 0.07

15 KFAED 1 21.29 1,059.80 1.54 76.51 19.76 983.29 0.05

16 SOCIETE GEN 1 13.09 651.67 - - 13.09 651.67 0.04

17 KBC 1 11.88 591.22 0.00 0.00 11.88 591.22 0.03

18 Fortis Bank 1 8.88 441.74 - - 8.88 441.74 0.02

19 ITALY II 1 8.49 422.67 0.04 1.88 8.45 420.79 0.02

20 Belgian 1 6.61 328.82 0.05 2.49 6.56 326.32 0.02

21 JFA 1 4.64 230.86 0.03 1.71 4.60 229.15 0.01

22 SFD 1 20.00 995.54 15.64 778.36 4.36 217.18 0.01

23 SIDA 1 2.00 99.73 0.01 0.53 1.99 99.20 0.01

24 LEONIA BANK 1 1.93 95.86 0.00 0.00 1.93 95.86 0.01

Multilateral 173 20,154.02 1,003,045.21 1,573.16 78,294.73 18,580.85 924,750.48 50.57

1 ADB 83 10,819.93 538,497.16 823.70 40,994.62 9,996.23 497,502.54 27.20

2 IBRD 71 9,021.24 448,978.32 731.68 36,415.08 8,289.56 412,563.23 22.56

3 IFAD 10 175.22 8,720.75 8.25 410.47 166.98 8,310.28 0.45

4 OPEC 6 97.00 4,827.59 7.97 396.86 89.03 4,430.73 0.24

5 EIB 1 26.50 1,318.88 - - 26.50 1,318.88 0.07

6 NDF 2 14.12 702.51 1.56 77.70 12.55 624.82 0.03

Commercial 59 1,810.77 90,120.14 289.07 14,386.81 1,521.70 75,733.34 4.14

1 CEXIM 6 778.50 38,745.13 219.32 10,915.26 559.18 27,829.87 1.52

2 BAC 6 204.87 10,196.36 - - 204.87 10,196.36 0.56

3 ECGD 5 135.39 6,738.04 - - 135.39 6,738.04 0.37

4 EDC 2 124.44 6,193.25 2.26 112.53 122.18 6,080.73 0.33

5 BNP PARIBAS 5 140.59 6,997.17 36.49 1,816.02 104.10 5,181.15 0.28

6 CAMC 2 59.97 2,984.43 4.07 202.46 55.90 2,781.97 0.15

7 BBV 5 52.15 2,595.51 0.02 1.00 52.13 2,594.51 0.14

8 RZOA 2 40.87 2,033.82 - - 40.87 2,033.82 0.11

9 FP 10 34.78 1,731.17 1.90 94.37 32.89 1,636.79 0.09

10 CCDF 2 43.26 2,152.83 13.85 689.46 29.40 1,463.36 0.08

11Banco

Santander1 25.75 1,281.74 - - 25.75 1,281.74 0.07

12 ANZ/EFIC 1 22.27 1,108.30 0.56 27.85 21.71 1,080.46 0.06

13 NIB 1 20.41 1,015.88 - - 20.41 1,015.88 0.06

14 BA 1 20.34 1,012.41 0.02 1.01 20.32 1,011.40 0.06

15 ERSTE 1 19.01 946.26 0.00 0.00 19.01 946.26 0.05

16 ICO 1 16.44 818.14 - - 16.44 818.14 0.04

17 ING Bank 1 15.28 760.36 - - 15.28 760.36 0.04

No.

of

Loa

Table VII- Schedule of Cumulative Net Loan Commitment by Creditor

(in million pesos)

CreditorCGLC

Cumulative

CancellationCNLC % to

Total

12

Inclusive of the CNLC are current year’s commitments on new loans amounting to P105.86 billion (US$2.13 billion) as presented in Table VI.

3.1.2 By Project Sector

Of the CNLC, 46.38 percent was intended for the implementation of projects categorized under the infrastructure sector accounts as presented in Table VIII.

3.1.3 By Implementing Agency

Around 79.93 percent of the CNLC represents loans by the NGAs of which 27.57 and 14.77 percent were implemented by DOF and DPWH respectively. The implementing agencies (IAs) of the loans secured are presented in Table IX.


18 EFIC 1 14.80 736.58 0.72 35.95 14.08 700.64 0.04

19 SOCIETE GEN 1 10.98 546.25 0.10 4.99 10.88 541.26 0.03

20 Bancaja 1 7.01 349.09 - - 7.01 349.09 0.02

21 Fortis Bank 1 6.94 345.19 - - 6.94 345.19 0.02

22 SIDA 1 10.00 497.69 3.81 189.43 6.19 308.26 0.02

23 NDF 1 6.72 334.53 5.96 296.48 0.76 38.05 0.00


No.

of

Loa

(Table VII, continued)

CreditorCGLC

Cumulative

CancellationCNLC % to

Total

USD PHP% to

TotalUSD PHP

% to

TotalUSD PHP

% to

Total

Infra. 19.12 951.75 47.31 2.08 103.60 56.63 17.04 848.14 46.38

SRCD 10.06 500.72 24.89 0.15 7.63 4.17 9.91 493.09 26.96

GID 4.87 242.16 12.04 0.51 25.44 13.90 4.35 216.72 11.85

AARNR 4.86 241.71 12.01 0.79 39.44 21.55 4.06 202.27 11.06

ITT 1.52 75.46 3.75 0.14 6.85 3.74 1.38 68.60 3.75

Total 40.42 2,011.79 100.00 3.68 182.96 100.00 36.75 1,828.82 100.00


Table VIII - Schedule of Cumulative Net Loan Commitment by Sector (in billion)

Project

Sector

CGLC Cumulative Cancellation CNLC

% to CGLC 100% 9.09% 90.91%


Total 449 40,422.49 2,011,786.93 3,676.23 182,962.15 36,746.26 1,828,824.78 100.00

NGAs 315 31,554.56 1,570,438.95 2,183.00 108,645.67 29,371.56 1,461,793.29 79.93

1 DOF 41 10,676.77 531,372.24 546.92 27,219.52 10,129.85 504,152.72 27.57

2 DPWH 84 5,758.79 286,609.42 332.05 16,525.99 5,426.74 270,083.43 14.77

3 DOTr 41 4,809.04 239,341.06 376.91 18,758.47 4,432.13 220,582.59 12.06

4 DSWD 9 2,765.23 137,622.63 4.41 219.27 2,760.82 137,403.36 7.51

5 DAR 24 1,214.96 60,467.42 91.45 4,551.44 1,123.51 55,915.98 3.06

6 DA 22 1,213.33 60,386.25 197.34 9,821.47 1,015.99 50,564.78 2.76

7 DECS 11 978.25 48,686.32 75.72 3,768.50 902.53 44,917.82 2.46

8 DOE 4 762.80 37,963.54 42.28 2,104.24 720.51 35,859.31 1.96

9 Deped 3 661.32 32,913.29 6.23 310.08 655.09 32,603.21 1.78

Table IX - Schedule of CNLC by Implementing Agency

(in million)

IACGLC Cumulative Cancellation CNLC % to

Total

No. of

loans

13

3.2 Availments – P1.37 billion (US$27.51 billion)

As of December 31, 2016, cumulative availments reached P1.37 billion (US$27.51 billion), equivalent to 74.86 percent of the CNLC as presented in Chart II. Of these, P60.06 billion (US$1.21 billion) or 4.39 percent represents availments during the year.


10 DILG 10 609.65 30,341.74 43.55 2,167.48 566.10 28,174.26 1.54

11 DENR 13 780.67 38,853.07 391.42 19,480.69 389.25 19,372.38 1.06

12 SC 2 321.90 16,020.64 1.29 64.20 320.61 15,956.44 0.87

13 DOH 19 320.28 15,939.77 27.27 1,357.20 293.01 14,582.57 0.80

14 BOC 2 172.74 8,597.28 0.11 5.64 172.63 8,591.64 0.47

15 BFAR 9 167.83 8,352.88 19.99 994.68 147.85 7,358.20 0.40

16 PRRC 2 86.88 4,323.89 12.00 597.24 74.88 3,726.65 0.20

17 OCD 1 52.33 2,604.16 - - 52.33 2,604.16 0.14

18 BFP 2 42.89 2,134.76 - - 42.89 2,134.76 0.12

19 TESDA 4 41.22 2,051.71 1.31 65.12 39.92 1,986.59 0.11

20 NAMRIA 1 25.75 1,281.74 - - 25.75 1,281.74 0.07

21 DTI 1 27.50 1,368.65 7.58 377.21 19.92 991.44 0.05

22 DOT 1 17.30 860.96 0.67 33.17 16.63 827.79 0.05

23 PMMA 2 13.91 692.37 0.08 4.17 13.83 688.21 0.04

24 UP 2 13.56 674.79 - - 13.56 674.79 0.04

25 OP 4 8.66 430.90 0.12 6.05 8.54 424.85 0.02

26 BIR 1 11.00 547.46 4.30 213.84 6.70 333.62 0.02

GOCCs 127 8,644.03 430,204.82 1,476.09 73,463.70 7,167.94 356,741.12 19.51

1 DBP 24 1,626.11 80,930.03 190.87 9,499.22 1,435.25 71,430.80 3.91

2 LBP 22 1,285.36 63,971.31 123.43 6,143.21 1,161.93 57,828.09 3.16

3 PSALM 18 1,422.93 70,817.98 289.30 14,398.13 1,133.63 56,419.86 3.09

4 NIA 13 800.99 39,864.40 52.11 2,593.47 748.88 37,270.92 2.04

5 LRTA 7 843.81 41,995.41 138.48 6,891.90 705.33 35,103.50 1.92

6 BCDA 1 502.11 24,989.50 7.64 380.32 494.47 24,609.17 1.35

7 MWSS 6 394.46 19,631.98 28.56 1,421.49 365.90 18,210.49 1.00

8 PPA 4 246.30 12,257.95 8.10 403.20 238.20 11,854.76 0.65

9 NLRC 2 400.00 19,907.60 219.21 10,909.62 180.79 8,997.98 0.49

10 LWUA 7 264.48 13,162.69 87.32 4,345.72 177.16 8,816.97 0.48

11 SBMA 5 239.13 11,901.25 72.26 3,596.27 166.87 8,304.99 0.45

12 PNOC 2 172.80 8,599.89 83.40 4,150.92 89.39 4,448.97 0.24

13PHIVIDE

C1 70.30 3,498.88 0.01 0.43 70.29 3,498.45 0.19

14 NPC 3 210.55 10,479.06 148.10 7,371.03 62.45 3,108.03 0.17

15 SBGFC 3 52.21 2,598.27 0.24 12.16 51.96 2,586.11 0.14

16 PNR 2 43.00 2,140.07 0.00 0.25 43.00 2,139.82 0.12

17 NFA 3 19.64 977.39 0.04 1.80 19.60 975.60 0.05

18 PTA (TIEZA) 1 11.50 572.28 0.01 0.63 11.49 571.65 0.03

19 LLDA 2 15.00 746.54 8.20 407.94 6.80 338.60 0.02

20 PEZA 1 23.35 1,162.34 18.81 935.98 4.55 226.36 0.01

LGUs 7 223.90 11,143.16 17.13 852.78 206.76 10,290.38 0.56

1 ARMM 6 187.09 9,311.18 6.42 319.56 180.67 8,991.62 0.49

2 PG-LDN 1 36.81 1,831.98 10.71 533.22 26.10 1,298.76 0.07


(Table IX, continued)

IACGLC Cumulative Cancellation CNLC % to

Total

No. of

loans

14

3.2.1 By Creditor

The cumulative and current year availments from different creditors are presented in Table X with the biggest cumulative availments from multilateral and bilateral creditors at 52.84 percent and 41.72 percent, respectively.

USD PHP USD PHP

Total Availments 448 27,508.51 1,369,070.96 100.00 1,206.86 60,064.21 100.00

Bilateral 217 11,475.65 571,131.79 41.72 277.36 13,803.95 22.98

1 JICA 123 9,098.35 452,815.73 33.07 192.86 9,598.68 15.98

2 ECGD 5 520.30 25,894.74 1.89 - - -

3 BNP PARIBAS 4 361.66 17,999.56 1.31 - - -

4 AFD 4 327.84 16,316.11 1.19 55.46 2,760.41 4.60

5 KFW 21 244.75 12,181.10 0.89 1.31 65.32 0.11

6 KEXIM 15 238.96 11,893.01 0.87 27.72 1,379.54 2.30

7 USPL 10 234.13 11,652.29 0.85 - - 0.00

8 ICO 9 114.83 5,715.12 0.42 - - -

9 ANZ/EFIC 1 90.59 4,508.45 0.33 - - -

10 EFIC 3 89.27 4,442.75 0.32 - - -

11 FP 9 38.27 1,904.73 0.14 - - -

12 EIB 1 28.73 1,429.84 0.10 - - -

13 KFAED 1 19.76 983.29 0.07 - - -

14 SOCIETE GEN 1 12.66 630.19 0.05 - - -

15 KBC 1 11.88 591.22 0.04 - - -

16 Fortis Bank 1 8.88 441.74 0.03 - - -

17 ITALY II 1 8.45 420.79 0.03 - - -

18 Artigiancassa 1 6.90 343.43 0.03 - - -

19 Belgian 1 6.56 326.32 0.02 - - -

20 JFA 1 4.60 229.15 0.02 - - -

21 SFD 1 4.36 217.18 0.02 - - -

22 SIDA 1 1.99 99.20 0.01 - - -

23 LEONIA BANK 1 1.93 95.86 0.01 - - -

24 Natixis (French Gov't) 1 - - - - - -

Multilateral 173 14,534.26 723,355.47 52.84 929.50 46,260.26 77.02

1 ADB 83 8,327.26 414,439.34 30.27 699.50 34,813.37 57.96

2 IBRD 71 6,011.96 299,209.11 21.85 206.32 10,268.31 17.10

3 IFAD 10 107.53 5,351.70 0.39 15.27 759.91 1.27

4 OPEC 6 51.77 2,576.39 0.19 8.41 418.67 0.70

5 EIB 1 23.19 1,154.12 0.08 - - -

6 NDF 2 12.55 624.82 0.05 - - -

Commercial 58 1,498.60 74,583.69 5.45 - - 0.00

1 CEXIM 6 557.60 27,751.12 2.03 - - -

2 BAC 6 183.36 9,125.51 0.67 - - -

3 ECGD 5 135.39 6,738.04 0.49 - - -

4 EDC 2 122.18 6,080.73 0.44 - - -

5 BNP PARIBAS 5 104.10 5,181.15 0.38 - - -

6 CAMC 2 55.90 2,781.97 0.20 - - -

7 BBV 5 52.13 2,594.51 0.19 - - -

8 RZOA 2 40.87 2,033.82 0.15 - - -

9 FP 10 32.89 1,636.77 0.12 - - -

10 CCDF 2 29.40 1,463.36 0.11 - - -

11 Banco Santander 1 25.75 1,281.74 0.09 - - -

12 ANZ/EFIC 1 21.71 1,080.46 0.08 - - -

13 NIB 1 20.41 1,015.88 0.07 - - -

% to

Total

Table X- Cumulative and Current Availments by Creditor (in million pesos)

CreditorNo. of

Loan

Cumulative Availments CY Availments % to

Total

15


Cumulatively, the infrastructure sector is the greatest beneficiary of ODA loans at 40.30 percent. However, for current year, the SRCD sector availed significant percentage of the loan at 68.08 percent.


The NGAs availments reached P1.04 trillion (US$20.90 billion) or 75.98 percent of the total availments. The GOCCs availed P318.55 billion (US$6.40 billion) or 23.27 percent while LGUs availed P10.29 billion (US$0.21 billion) or 1.07 percent. The cumulative and current year availments by IAs, grouped by government sector, is presented in Table XII.

USD PHP USD PHP

14 Bank of America 1 20.32 1,011.40 0.07 - - -

15 ERSTE 1 19.01 946.26 0.07 - - -

16 ICO 1 16.44 818.12 0.06 - - -

17 ING Bank 1 15.28 760.36 0.06 - - -

18 EFIC 1 14.08 700.64 0.05 - - -

19 SOCIETE GEN 1 10.88 541.26 0.04 - - -

20 Bancaja 1 7.01 349.09 0.03 - - -

21 Fortis Bank 1 6.94 345.19 0.03 - - -

22 SIDA 1 6.19 308.26 0.02 - - -

23 NDF 1 0.76 38.05 0.00 - - -


% to

Total

(Table X, continued)

CreditorNo. of

Loan

Cumulative Availments CY Availments % to

Total

USD PHP USD PHP

Total Availments 27.51 1,369.07 100.00 1.21 60.06 100.00

1 Infra. 11.09 551.70 40.30 0.30 15.00 24.98

2 SRCD 8.00 398.25 29.09 0.82 40.89 68.08

3 GID 3.84 190.89 13.94 0.00 0.12 0.21

4 AARNR 3.21 159.77 11.67 0.08 3.93 6.54

5 ITT 1.38 68.46 5.00 0.00 0.11 0.19

CY Availments % to

Total

Table XI - Cumulative and Current Year Availments by Project Sector (in billion)

CreditorCumulative Availments % to

Total

USD PHP USD PHP

Total Availments 27.51 1,369.07 100.00 1.21 60.06 100.00

NGAs 20.90 1,040.23 75.98 1.11 55.44 92.30

1 BFAR 0.10 4.85 0.35 0.01 0.40 0.67

2 DOF 9.63 479.39 35.02 0.60 29.99 49.92

3 DPWH 3.86 192.31 14.05 0.15 7.28 12.12

4 DSWD 1.51 75.08 5.48 0.10 4.90 8.17

5 DOTr 1.23 61.01 4.46 0.07 3.55 5.91

6 DECS 0.90 44.92 3.28 - - -

7 DAR 0.89 44.36 3.24 0.02 0.82 1.37

8 DA 0.59 29.56 2.16 0.04 1.94 3.23

% to

Total

CY Availments % to

Total

Table XII - Cumulative and Current Year Availments by IA (in billion)

IACumulative Availments

16

USD PHP USD PHP

9 DOE 0.32 16.02 1.17 0.00 0.01 0.02

10 SC 0.32 15.96 1.17 - - -

11 DILG 0.32 15.73 1.15 - - -

12 DOH 0.29 14.55 1.06 0.00 0.06 0.10

13 Deped 0.26 12.91 0.94 0.07 3.46 5.76

14 DENR 0.21 10.41 0.76 0.01 0.41 0.69

15 BOC 0.17 8.59 0.63 - - -

16 PRRC 0.07 3.73 0.27 - - -

17 OCD 0.05 2.60 0.19 0.05 2.60 4.34

18 TESDA 0.04 1.95 0.14 - - -

19 NAMRIA 0.03 1.28 0.09 - - -

20 BFP 0.02 1.07 0.08 - - -

21 DTI 0.02 0.99 0.07 - - -

22 DOT 0.02 0.83 0.06 - - -

23 PMMA 0.01 0.69 0.05 - - -

24 UP 0.01 0.67 0.05 - - -

25 OP 0.01 0.42 0.04 - - -

26 BIR 0.01 0.33 6.88 - - -

GOCCs 6.40 318.55 23.27 0.09 4.62 7.70

1 DBP 1.34 66.46 4.85 0.04 1.81 3.01

2 PSALM 1.13 56.42 4.12 - - -

3 LBP 0.94 46.55 3.40 0.05 2.46 4.10

4 LRTA 0.71 35.10 2.56 - - -

5 NIA 0.50 24.89 1.82 0.01 0.35 0.58

6 BCDA 0.49 24.61 1.80 - - -

7 MWSS 0.24 12.01 0.88 - - -

8 PPA 0.24 11.85 0.87 - - -

9 NLRC 0.18 9.00 0.66 - - -

10 SBMA 0.17 8.30 0.61 - - -

11 LWUA 0.11 5.46 0.40 0.00 0.00 0.00

12 PNOC 0.09 4.45 0.32 - - -

13 PHIVIDEC 0.07 3.50 0.26 - - -

14 NPC 0.06 3.11 0.23 - - -

15 SBGFC 0.05 2.59 0.19 - - -

16 PNR 0.04 2.14 0.16 - - -

17 NFA 0.02 0.98 0.07 - - -

18 PTA (TIEZA) 0.01 0.57 0.04 - - -

19 LLDA 0.01 0.34 0.02 - - -

20 PEZA 0.00 0.23 0.02 - - -

LGUs 0.21 10.29 1.07 - - -

1 ARMM 0.18 8.99 0.94 - - -

2 Provl Gov't-LDN 0.03 1.30 0.14 - - -

% to

Total

CY Availments % to

Total

(Table XII continued)

IACumulative Availments

17

DOF availed loans from different creditors for various program loans such as Expanding Private Participation in Infrastructure and Encouraging Investment through Capital Market Reforms, among others. The programs and projects for which loans were availed in CY 2016, implemented by various agencies are presented in Table XIII.

USD PHP

1,206.86 60,064.21 100.00

1,113.96 55,440.82 92.30

602.50 29,985.82 49.92

1 3333-PHI Expanding Private Participation in

Infrastructure Program, Subprogram 1300.00 14,930.70

2 3334-PHI Encouraging Investment through Capital

Market Reforms Program, Subprogram 1300.00 14,930.70

3 8576-PH

Second Disaster Risk Management

Development Policy Loan with a

Catastrophe Deferred Drawdown Option

IBRD 2.50 124.42

146.33 7,282.47 12.12

1 PH-P250 Arterial Road Bypass Project, Phase II 9.67 481.35

2 PH-P249 Central luzon Link Expressway Project 5.85 291.40

3 PH-P253

Flood Risk Management Project for

Cagayan River, Tagoloan River, and Imus

River

11.45 569.67

4 PH-P259 Flood Risk Management Project for CDO

River0.41 20.41

5 PH-P252 Pasig-Marikina River Channel

Improvement Project, Phase III18.46 918.71

6 PH-P247 Road Upgrading and Preservation 53.34 2,654.77

7 PHL-10 Gapan-San Fernando-Olongapo Road

Project, Phase II7.69 382.70

8 PHL-17

Integrated Disaster Risk Reduction and

Climate Change Adaptation Measures in

the Low Lying Areas of Pampanga Bay

0.65 32.58

9 PHL-14 Samar Pacific Coastal Road Project 0.30 15.03

10 7552 PH National Roads Improvement and

Management Project 2IBRD 26.33 1,310.39

11 2836-PHI ADB 6.34 315.73

12 1446P OPEC 5.82 289.74

98.55 4,904.55 8.17

1 3100-PHI ADB 9.16 455.65

2 8335-PH 66.08 3,288.86

4 7805-PH 17.04 848.21

5 8218-PH 0.88 43.91

6 8584-PH Social Welfare Development and Reform

Project 21.13 55.99

3 2662 PHI Social Protection Support Project ADB 4.26 211.92

71.32 3,549.53 5.91

1CPH 1007

02 R AFD 3.14 156.25

2 8444-PH IBRD 6.98 347.26

3 PH-P255 Capacity Enhancement of Mass Transit

Systems in Metro Manila Project3.89 193.40

4 PH-P257 Maritime Safety Capability Improvement

Project for the Philippine Coast Guard17.11 851.65

IBRD

JICA

ADB

DPWH

Social Welfare and Development Reform

Project

KALAHI-CIDSS National Community-

Driven Development Project

Road Improvement and Institutional

Development

KEXIM

JICA

Table XIII - Programs and Projects for Implemention by Various IAs out of CY Availments

(in million)

IA/ Loan Acct No./Project Name CreditorCY Availments

% to Total

Total

NGAs

DOF

DSWD

DOTr

Cebu Bus Rapid Transit (BRT) Project

18

USD PHP

5 PH-P256 New Bohol Airport Construction and

Sustainable Environmet Protection Project2.07 103.05

6 PH-P228

New Communications, Navigations

Surveillance/Air Traffic Mgmt. (CNS/ATM)

System Development Project

19.06 948.69

7PHL-11-

EDCF

Puerto Princesa Airport Development

ProjectKEXIM 19.07 949.23

69.55 3,461.43 5.76

1 3237-PHI Senior High Support Program - Results

Based LendingADB 69.55 3,461.43

52.33 2,604.16 4.34

1CPH 1020

01 J

Disaster Risk Reduction and

Management FacilityAFD 52.33 2,604.16

39.03 1,942.63 3.23

1 8421-PH Phil. Rural Development Project IBRD 36.78 1,830.59

2 749-PH Second Cordillera Highland Agricultural

Resource Mgnt. Project (CHARM2)IFAD 2.25 112.03

16.50 821.42 1.37

1 1225-P OPEC 2.59 128.93

2 2465 PHI ADB 5.15 256.14

3 PH-P242 Agrarian Reform Infrastructure Support

Project, Phase III2.49 124.05

5 PH-P251 Mindanao Sustainable Agrarian and

Agriculture Development Project 2.58 128.50

4 PH-1259

Convergence on Value-Chain

Enhancement for Rural Growth and

Empowerment Project

IFAD 3.69 183.81

8.31 413.41 0.69

1 PH-P248 Forestland Management Project JICA 2.22 110.60

2 2311 PHI Integrated Coastal Resources

Management ProjectADB (0.22) (11.07)

3 2957-PHI ADB 5.04 250.75

4 I-890-PH IFAD 1.27 63.12

8.06 400.94 0.67

1 PH-1258 Fisheries, Coastal Resources and

Livelihood ProjectIFAD 8.06 400.94

1.27 63.03 0.10

1 7113011 Health Sector Reform Project KFW 1.27 63.03

0.23 11.41 0.02

1 2964-PHI

Market Transformation through

Introduction of Energy Efficient Electric

Vehicles Project

ADB 0.23 11.41

92.90 4,623.39 7.70

36.35 1,808.96 3.01

1 PH-P243 Environmental Development Project 36.25 1,804.36

2JBIC PH-

P245

Logistics Infrastructure Development

Project0.09 4.60

49.50 2,463.78 4.10

1 8162-PH Metro Manila Waste Water Management

Project42.14 2,097.25

2 4833 PH Support for Strategic Local Development &

Investment Project2.30 114.53

3 PH-P244 Agricultural Credit Support Project JICA 5.06 252.00

7.00 348.35 0.58

1 7709 PH Participatory Irrigation Development

ProjectIBRD 4.16 206.88

OCD

DepEd

JICA

NIA

DAR

DENR

BFAR

GOCCs

DBP

Integrated Natural Resources and

Environmental Management Project

DOE

DOH

Agrarian Reform Communities and

Projects II

LBP

IBRD

JICA

(Table XIII, continued)


% to Total

DA

JICA

19

3.3 Undrawn Commitments – P459.75 billion (US$9.24 billion)

Of the 449 ODA loans from 43 creditors, commitments for 90 loans from 18 creditors were not fully drawn with undrawn balances of P459.75 billion (US$9.24 billion) as of December 31, 2016.

3.3.1 By Creditor

The loans with biggest undrawn balances or unavailed commitments are loans from JICA under bilateral creditors which represent 44.18 percent of the total undrawn balances. The loans with undrawn balances are presented in Table XIV.

USD PHP

2 PH-P254 National Irrigation Sector Rehabilitation

and Improvement ProjectJICA 2.84 141.47

0.05 2.29 0.00

1 9266103 Provincial Towns Water Supply

Programme IIIKFW 0.05 2.29

LWUA

(Table XIII, continued)


% to Total

No. of

LoansUSD PHP

No. of

LoansUSD PHP

Total 449 27,508.51 1,369,070.96 90 9,237.75 459,753.83 100.00

Bilateral 217 11,475.65 571,131.79 47 5,168.06 257,209.17 55.94

1 JICA 123 9,098.35 452,815.73 22 4,081.09 203,111.97 44.18

2 KEXIM 15 238.96 11,893.01 8 408.35 20,323.27 4.42

3 BNP PARIBAS 4 361.66 17,999.56 3 326.61 16,255.06 3.54

4 ECGD 5 520.30 25,894.74 3 216.16 10,758.26 2.34

5 AFD 4 327.84 16,316.11 1 50.12 2,494.47 0.54

6Natixis (French

Gov't)

1- - 1 29.85 1,485.41

0.32

7 KFW 21 244.75 12,181.10 4 28.64 1,425.63 0.31

8 Artigiancassa 1 6.90 343.43 1 20.51 1,020.63 0.22

9 EIB 1 28.73 1,429.84 1 6.29 312.93 0.07

10 SOCIETE GEN 1 12.66 630.19 1 0.43 21.47 0.00

11 FP 9 38.27 1,904.73 1 0.00 0.04 0.00

12 ICO 9 114.83 5,715.12 1 0.00 0.01 0.00

13 ANZ/EFIC 1 90.59 4,508.45 - - 0.00

14 Belgian 1 6.56 326.32 - - 0.00

15 EFIC 3 89.27 4,442.75 - - 0.00

16 Fortis Bank 1 8.88 441.74 - - 0.00

17 ITALY II 1 8.45 420.79 - - 0.00

18 JFA 1 4.60 229.15 - - 0.00

19 KBC 1 11.88 591.22 - - 0.00

20 KFAED 1 19.76 983.29 - - 0.00

21 LEONIA BANK 1 1.93 95.86 - - 0.00

22 SFD 1 4.36 217.18 - - 0.00

23 SIDA 1 1.99 99.20 - - 0.00

Table XIV - Schedule of Loans with Undrawn Balances by Creditor (in million)

Creditor

Cumulative Availments Undrawn Balances% to

Total

20


The infrastructure sector with the highest cumulative net commitments has also undrawn balances of P296.44 billion (US$5.96 billion) representing 64.48 percent of the total undrawn balances P459.75 billion (US$9.24 billion) as presented in Table XVII.

No. of

LoansUSD PHP

No. of

LoansUSD PHP

24 USPL 10 234.13 11,652.29 - - 0.00

Multilateral 173 14,534.26 723,355.47 36 4,046.60 201,395.01 43.80

1 IBRD 71 6,011.96 299,209.11 12 2,277.61 113,354.13 24.66

2 ADB 83 8,327.26 414,439.34 14 1,668.97 83,063.20 18.07

3 IFAD 10 107.53 5,351.70 5 59.45 2,958.58 0.64

4 OPEC 6 51.77 2,576.39 4 37.26 1,854.34 0.40

5 EIB 1 23.19 1,154.12 1 3.31 164.76 0.04

6 NDF 2 12.55 624.82 - - 0.00

Commercial 59 1,498.60 74,583.69 7 23.10 1,149.64 0.25

1 BAC 6 183.36 9,125.51 3 21.52 1,070.85 0.23

2 CEXIM 6 557.60 27,751.12 2 1.58 78.76 0.02

3 FP 10 32.89 1,636.77 1 0.00 0.02 0.00

4 ICO 1 16.44 818.12 1 0.00 0.01 0.00

5 RZOA 2 40.87 2,033.82 0.00 0.00 0.00

6 ANZ/EFIC 1 21.71 1,080.46 - - 0.00

7 Bancaja 1 7.01 349.09 - - 0.00

8 Banco

Santander

1 25.75 1,281.74 - - 0.00

9 Bank of

America

1 20.32 1,011.40 - - 0.00

10 BBV 5 52.13 2,594.51 - - 0.00

11 BNP PARIBAS 5 104.10 5,181.15 - - 0.00

12 CAMC 2 55.90 2,781.97 - - 0.00

13 Credit Agricole

Indosuez

1 - - - - 0.00

14 Credit Com'l

de France

2 29.40 1,463.36 - - 0.00

15 ECGD 5 135.39 6,738.04 - - 0.00

16 EDC 2 122.18 6,080.73 - - 0.00

17 EFIC 1 14.08 700.64 - - 0.00

18 ERSTE 1 19.01 946.26 - - 0.00

19 Fortis Bank 1 6.94 345.19 - - 0.00

20 ING Bank 1 15.28 760.36 - - 0.00

21 NDF 1 0.76 38.05 - - 0.00

22 NIB 1 20.41 1,015.88 - - 0.00

23 SIDA 1 6.19 308.26 - - 0.00

24 SOCIETE GEN 1 10.88 541.26 - - 0.00


(Table XIV, continued)

Creditor


Total

21


DOTr has the highest undrawn balance which represent 34.71 percent of the total undrawn amount. Three loans financing three projects under DOTr, did not avail of any amount for the construction/implementation of North-South Commuter Railway Project, Cebu Bus Rapid Transit (BRT) Project and Maritime Safety Capability Improvement Project II totaling P110.64 billion (US$2.22 billion) which represent 24.07 percent of the total undrawn amount. Along with DOTr, there are 13 other agencies with unavailed commitments ranging from 20.67 percent to 60.40 percent as of December 31, 2016 as shown in Table XVI.

USD PHP USD PHPNo. of

LoansUSD PHP

1 Infra. 17,041.60 848,143.30 11,085.21 551,700.04 54 5,956.38 296,443.26 64.48

2 SRCD 9,907.49 493,086.02 8,002.02 398,252.73 12 1,905.47 94,833.29 20.63

3 ARRNR 4,064.20 202,271.17 3,210.17 159,766.89 20 854.03 42,504.28 9.25

4 GID 4,354.53 216,720.44 3,835.58 190,892.98 2 518.95 25,827.46 5.62

5 ITT 1,378.45 68,603.84 1,375.52 68,458.32 2 2.92 145.53 0.03

Total 36,746.26 1,828,824.78 27,508.51 1,369,070.96 90 9,237.75 459,753.83 100.00

Table XV - Schedule of Undrawn Balances by Project Sector (in million)

Creditor

CNLC Cumulative Availments Undrawn Balances% to

Total

% to CNLC100.00 74.86 25.14


No. of

LoansUSD PHP USD PHP

No. of

LoansUSD PHP

Total 449 36,746.26 1,828,824.78 27,508.51 1,369,070.96 90 9,237.75 459,753.83 100.00 25.14

NGAs 315 29,371.56 1,461,793.29 20,901.18 1,040,230.63 72 8,470.39 421,562.66 91.69 28.84

1 DOTr 41 4,432.13 220,582.59 1,225.95 61,014.37 13 3,206.18 159,568.21 34.71 72.34

2 DPWH 84 5,426.74 270,083.43 3,864.07 192,310.92 25 1,562.67 77,772.51 16.92 28.80

3 DSWD 9 2,760.82 137,403.36 1,508.66 75,084.43 5 1,252.16 62,318.93 13.55 45.35

4 DOF 41 10,129.85 504,152.72 9,632.35 479,392.64 1 497.50 24,760.08 5.39 4.91

5 DA 22 1,015.99 50,564.78 593.86 29,556.07 3 422.12 21,008.71 4.57 41.55

6 DOE 4 720.51 35,859.31 321.86 16,018.48 2 398.66 19,840.83 4.32 55.33

7 Deped 3 655.09 32,603.21 259.44 12,912.11 2 395.65 19,691.10 4.28 60.40

8 DILG 10 566.10 28,174.26 316.09 15,731.53 2 250.01 12,442.73 2.71 44.16

9 DAR 24 1,123.51 55,915.98 891.27 44,357.38 8 232.24 11,558.59 2.51 20.67

10 DENR 13 389.25 19,372.38 209.24 10,413.75 4 180.00 8,958.63 1.95 46.24

11 BFAR 9 147.85 7,358.20 97.48 4,851.34 2 50.37 2,506.86 0.55 34.07

12 BFP 2 42.89 2,134.76 21.45 1,067.38 2 21.45 1,067.38 0.23 50.00

13 TESDA 4 39.92 1,986.59 39.15 1,948.63 1 0.76 37.96 0.01 1.91

14 DOH 19 293.01 14,582.57 292.40 14,552.45 2 0.61 30.12 0.01 0.21

15 BIR 1 6.70 333.62 6.70 333.62 - -

16 BOC 2 172.63 8,591.64 172.63 8,591.64 - -

17 DECS 11 902.53 44,917.82 902.53 44,917.82 - -

18 DOT 1 16.63 827.79 16.63 827.79 - -

19 DTI 1 19.92 991.44 19.92 991.44 - -

20 NAMRIA 1 25.75 1,281.74 25.75 1,281.74 - -

21 OCD 1 52.33 2,604.16 52.33 2,604.16 - -

22 OP 4 8.54 424.85 8.54 424.85 - -

23 PMMA 2 13.83 688.21 13.83 688.21 - -

24 PRRC 2 74.88 3,726.65 74.88 3,726.65 - -

25 SC 2 320.61 15,956.44 320.61 15,956.44 - -

26 UP 2 13.56 674.79 13.56 674.79 - -

127 7,167.94 356,741.12 6,400.57 318,549.95 18 767.37 38,191.17 8.31 10.71

1 NIA 13 748.88 37,270.92 500.13 24,891.20 4 248.74 12,379.72 2.69 33.22

GOCCs

Table XVI - Schedule of IA with Undrawn Balances (in million)

Sector/ IA


Total

CNLC% to

C N LC

22

3.4 Repayments – P498.80 billion (US$10.02 billion)

As of December 31, 2016, cumulative repayments to principal loans reached P498.80 billion (US$10.02 billion), which is equivalent to 36.43 percent of the total cumulative availments. This is relatively higher by 1.75 percent compared to 2015 repayment in relation to availments of only 34.68 percent. Of this amount, P45.64 billion (US$0.92 billion) or 9.15 percent represent repayment during the year. Comparative figures in five years are presented in Chart VI.

Chart VI – Comprative Repayments in relation to Availments

3.4.1 By Creditor

The details of repayments by creditors are shown in Table XVII.

No. of

LoansUSD PHP USD PHP

No. of

LoansUSD PHP

2 LBP 22 1,161.93 57,828.09 935.28 46,547.80 5 226.65 11,280.30 2.45 19.51

3 MWSS 6 365.90 18,210.49 241.33 12,010.68 2 124.57 6,199.81 1.35 34.05

4 DBP 24 1,435.25 71,430.80 1,335.29 66,456.00 3 99.96 4,974.80 1.08 6.96

5 LWUA 7 177.16 8,816.97 109.72 5,460.49 2 67.44 3,356.48 0.73 38.07

6 NPC 3 62.45 3,108.03 62.45 3,107.97 2 0.00 0.06 0.00 0.00

7 BCDA 1 494.47 24,609.17 494.47 24,609.17 - -

8 LLDA 2 6.80 338.60 6.80 338.60 - -

9 LRTA 7 705.33 35,103.50 705.33 35,103.50 - -

10 NFA 3 19.60 975.60 19.60 975.60 - -

11 NLRC 2 180.79 8,997.98 180.79 8,997.98 - -

12 PEZA 1 4.55 226.36 4.55 226.36 - -

13 PHIVIDEC 1 70.29 3,498.45 70.29 3,498.45 - -

14 PNOC 2 89.39 4,448.97 89.39 4,448.97 - -

15 PNR 2 43.00 2,139.82 43.00 2,139.82 - -

16 PPA 4 238.20 11,854.76 238.20 11,854.76 - -

17 PSALM 18 1,133.63 56,419.86 1,133.63 56,419.86 - -

18 PTA 1 11.49 571.65 11.49 571.65 - -

19 SBGFC 3 51.96 2,586.11 51.96 2,586.11 - -

20 SBMA 5 166.87 8,304.99 166.87 8,304.99 - -

7 206.76 10,290.38 206.76 10,290.38 0 - - 0.00 0.00

1 ARMM 6 180.67 8,991.62 180.67 8,991.62 - - 0.00

2 PG-LDN 1 26.10 1,298.76 26.10 1,298.76 - - 0.00


LGUs

(Table XVI, continued)

Sector/ IA


Total

CNLC% to

C N LC

USD PhP USD PhP

2016 27.51 1,369.07 10.02 498.80 36.43

2015 26.12 1,230.59 9.06 426.77 34.68

2014 24.13 1,079.53 8.33 372.56 34.51

2013 23.29 1,034.02 7.60 337.23 32.61

2012 24.53 1,007.80 6.45 264.81 26.28

Year

Cumulative

Availment

Cumulative

Repayment% to

Cumulative

Availments

USD PHP USD PHP

Total Repayment 10,022.34 498,802.04 100.00 917.11 45,643.78 100.00

Bilateral 4,415.41 219,750.49 44.06 383.51 19,087.00 41.82

1 JICA 3,103.09 154,437.83 30.96 296.02 14,732.46 32.28

Table XVII - Cumulative and Current Repayment by Creditor (in million)

CreditorCumulative Repayment % to

Total

Current Repayment % to

Total

23

USD PHP USD PHP

2 ECGD 508.38 25,301.47 5.07 2.98 148.32 0.32

3 BNP PARIBAS 153.07 7,617.98 1.53 36.17 1,799.96 3.94

4 KFW 124.02 6,172.15 1.24 4.97 247.51 0.54

5 USPL 123.39 6,141.03 1.23 11.29 561.82 1.23

6 ANZ/EFIC 90.59 4,508.45 0.90 - - 0.00

7 EFIC 89.27 4,442.75 0.89 - - 0.00

8 KEXIM 58.26 2,899.30 0.58 10.82 538.60 1.18

9 ICO 42.53 2,116.84 0.42 5.32 264.98 0.58

10 EIB 28.73 1,429.84 0.29 - - 0.00

11 AFD 20.93 1,041.67 0.21 10.47 520.83 1.14

12 KFAED 17.24 858.07 0.17 1.26 62.61 0.14

13 FP 15.05 749.20 0.15 1.43 70.92 0.16

14 Fortis Bank 8.88 441.74 0.09 0.33 16.36 0.04

15 ITALY II 8.45 420.79 0.08 - - 0.00

16 SOCIETE GEN 6.33 315.10 0.06 1.27 63.02 0.14

17 KBC 6.18 307.43 0.06 0.95 47.30 0.10

18 SFD 4.36 217.18 0.04 - - 0.00

19 JFA 2.30 114.57 0.02 - - 0.00

20 SIDA 1.99 99.20 0.02 - - 0.00

21 LEONIA BANK 1.93 95.86 0.02 - - 0.00

22 Belgian 0.44 22.05 0.00 0.25 12.32 0.03

Multilateral 4,559.86 226,939.65 45.50 482.22 23,999.75 52.58

1 ADB 3,060.03 152,294.73 30.53 295.07 14,685.47 32.17

2 IBRD 1,438.18 71,576.63 14.35 182.00 9,058.00 19.84

3 EIB 23.19 1,154.12 0.23 - - 0.00

4 OPEC 20.66 1,028.47 0.21 1.92 95.63 0.21

5 IFAD 16.16 804.49 0.16 2.98 148.15 0.32

6 NDF 1.63 81.23 0.02 0.25 12.50 0.03

Commercial 1,047.08 52,111.90 10.45 51.38 2,557.04 5.60

1 CEXIM 260.67 12,973.34 2.60 25.12 1,250.21 2.74

2 ECGD 135.39 6,738.04 1.35 - - 0.00

3 EDC 122.18 6,080.73 1.22 - - 0.00

4 BNP PARIBAS 100.58 5,005.79 1.00 0.47 23.38 0.05

5 BAC 92.23 4,590.02 0.92 10.68 531.72 1.16

6 CAMC 55.90 2,781.97 0.56 - - 0.00

7 BBV 52.13 2,594.51 0.52 - - -

8 FP 29.53 1,469.51 0.29 1.51 75.10 0.16

9 Credit Com'l de

France

29.40 1,463.36 0.29 - - -

10 Banco

Santander

25.75 1,281.74 0.26 - - -

11 ANZ/EFIC 21.71 1,080.46 0.26 - - -

12 RZOA 20.49 1,019.90 0.22 3.30 164.46 0.00

13 NIB 20.41 1,015.88 0.20 6.12 304.77 0.36

14 Bank of America 20.32 1,011.40 0.20 - - 0.67

15 ING Bank 15.28 760.36 0.20 1.53 76.04 0.00

16 EFIC 14.08 700.64 0.15 - - 0.17

17 SOCIETE GEN 10.88 541.26 0.14 - - -

18 Fortis Bank 6.24 310.47 0.11 0.70 34.73 -

19 SIDA 6.19 308.26 0.00 - - -

(Table XVII, continued)


Total


Total

24


Of the cumulative and current year repayments, 56.66 percent and 38.45 percent, respectively, were paid for the loans falling under the infrastructure sector accounts as presented in Table XVIII.

3.4.3 By implementing Agency

The following are the repayments by NGAs accounts for 65.75 percent and 78.19 percent of cumulative and current year repayments, respectively, is presented in Table XIX.

USD PHP USD PHP

20 ERSTE 5.55 275.99 0.00 1.58 78.85 0.00

21 Bancaja 2.05 102.17 0.00 0.34 17.03 -

22 NDF 0.12 6.09 0.00 0.02 0.76 0.00

(Table XVII, continued)


Total


Total

USD PHP USD PHP

Total Repayments 10,022.34 498,802.04 100.00 917.11 45,643.78 100.00

1 Infra. 5,678.76 282,626.32 56.66 352.67 17,552.19 38.45

2 GID 1,575.11 78,391.41 15.72 207.35 10,319.76 22.61

3 AARNR 1,269.50 63,181.58 12.67 126.15 6,278.16 13.75

4 SRCD 883.80 43,985.91 8.82 156.97 7,812.36 17.12

5 ITT 615.18 30,616.82 6.14 73.97 3,681.32 8.07

Table XVIII - Cumulative and Current Year Repayment by Project Sector (in million)

Project SectorCumulative Repayments % to

Total

CY Repayments % to

Total

USD PHP USD PHP

Total 10,022.34 498,802.04 100.00 917.11 45,643.78 100.00

NGAs 6,589.21 327,938.45 65.75 717.12 35,690.58 78.19

1 DOF 2,221.92 110,582.81 22.17 292.13 14,538.99 31.85

3 DPWH 1,707.24 84,967.56 17.03 141.02 7,018.60 15.38

4 DOTr 698.61 34,769.32 6.97 29.94 1,490.04 3.26

5 DAR 375.76 18,701.05 3.75 43.34 2,156.77 4.73

6 DECS 321.26 15,988.65 3.21 53.31 2,652.96 5.81

7 DILG 254.74 12,678.23 2.54 8.49 422.77 0.93

8 DA 226.30 11,262.95 2.26 25.59 1,273.69 2.79

9 DOE 174.02 8,660.97 1.74 25.17 1,252.73 2.74

10 DOH 125.79 6,260.28 1.26 21.17 1,053.61 2.31

11 SC 93.97 4,676.97 0.94 22.18 1,103.80 2.42

12 DENR 90.40 4,499.37 0.90 13.79 686.38 1.50

13 BOC 59.46 2,959.22 0.59 11.51 572.78 1.25

14 DSWD 59.31 2,951.84 0.59 14.90 741.38 1.62

15 BFAR 56.65 2,819.52 0.57 2.32 115.23 0.25

16 PRRC 27.24 1,355.92 0.27 3.97 197.57 0.43

17 NAMRIA 25.75 1,281.74 0.26 - - 0.00

18 Deped 18.60 925.64 0.19 2.48 123.31 0.27

19 DTI 14.49 721.01 0.14 1.61 80.32 0.18

20 TESDA 12.22 608.15 0.12 2.31 115.05 0.25

Table XIX - Cumulative and Current Year Repayments by IA (in million)

IACummulative Repayment % to

Total


Total

25

3.5 Debt Service Expenditures for 2016 – P61.12 billion

Total debt service for the year amounted to P61.12 billion which is relatively higher by P7.87 billion or 14.78 percent when compared to debt service expenditures in 2015. Of the total payments, P 45.27 billion represents payment to principal which accounts to 74.07 percent of the total debt service expenditure for 2016. The remaining balances, which accounts to 25.93 percent represents payment for interest, commitment fee, guaranty fee and other charges as presented in Chart VII.

Chart VII - Debt Service Expenditures (in billion)

USD PHP USD PHP

21 UP 8.27 411.45 0.08 0.33 16.46 0.04

22 PMMA 7.26 361.24 0.07 0.26 12.81 0.03

23 OP 5.55 276.04 0.06 0.21 10.37 0.02

24 DOT 3.27 162.86 0.03 0.55 27.14 0.06

25 BIR 1.12 55.65 0.01 0.56 27.82 0.06

GOCCs 3,305.14 164,493.68 32.98 193.73 9,641.83 21.12

1 PSALM 1,133.63 56,419.86 11.31 1.30 64.70 0.14

2 LBP 468.84 23,333.79 4.68 37.25 1,854.14 4.06

3 DBP 386.85 19,253.29 3.86 42.66 2,123.06 4.65

4 LRTA 284.65 14,166.73 2.84 30.09 1,497.39 3.28

5 NLRC 180.79 8,997.98 1.80 - - 0.00

6 NIA 171.14 8,517.70 1.71 21.19 1,054.74 2.31

7 PPA 163.63 8,143.82 1.63 6.00 298.74 0.65

8 MWSS 104.88 5,219.52 1.05 17.61 876.43 1.92

9 PNOC 89.39 4,448.97 0.89 - - 0.00

10 BCDA 89.17 4,437.79 0.89 16.21 806.86 1.77

11 SBMA 57.31 2,852.15 0.57 7.02 349.49 0.77

12 LWUA 54.49 2,711.67 0.54 2.96 147.18 0.32

13 NPC 49.83 2,479.91 0.50 1.22 60.97 0.13

14 NFA 16.99 845.48 0.17 0.94 46.65 0.10

15 PHIVIDEC 16.13 802.96 0.16 2.30 114.70 0.25

16 SBGFC 13.49 671.33 0.13 2.90 144.33 0.32

17 PNR 13.46 669.75 0.13 2.92 145.54 0.32

18 PTA (TIEZA) 6.44 320.70 0.06 0.56 27.88 0.06

19 PEZA 2.22 110.44 0.02 0.22 11.04 0.02

20 LLDA 1.81 89.88 0.02 0.36 17.98 0.04

LGUs 127.99 6,369.90 1.88 6.26 311.37 0.68

1 ARMM 117.43 5,844.60 1.72 5.10 254.07 0.56

2 PG-LDN 10.55 525.31 0.15 1.15 57.31 0.13

(Table XIX, continued)

IACummulative Repayment % to

Total


Total

% of Increase

14.78

26

3.5.1 By creditor

Of the total debt service expenditures, P31.68 billion, equivalent to 51.83 percent represent payments to multilateral creditors with the biggest payments made to ADB in the amount of P17.37 billion representing 28.42 percent of the total debt service as presented in Table XX.


The BTr payments for loans directly used by NGAs and those relent to GOCCs amounted to P51.02 billion of which P37.70 billion or 73.89 percent represents payment to principal while P13.32 billion or 26.11 percent represent payments for interest, commitment fees and other charges. On the other hand, GOCCs payments direct to their creditors for loans guaranteed by the NG amounted to P10.11 billion as presented in Table XXI.

GRAND TOTAL 61,124.03 100.00 45,274.97 12,976.92 165.94 658.42 2,047.77

Bilateral 25,822.52 42.25 18,495.99 4,961.68 77.37 517.26 1,770.22

1 JICA 19,827.51 32.44 13,920.08 3,854.60 71.35 498.08 1,483.40

2 BNP PARIBAS 2,190.48 3.58 1,665.61 305.67 - - 219.20

3 USPL 1,603.03 2.62 1,195.15 388.79 - - 19.09

4 AFD 604.73 0.99 511.80 74.93 5.00 - 13.00

5 KEXIM 471.63 0.77 374.27 86.70 - - 10.66

6 KFW 409.32 0.67 300.72 69.84 1.02 19.18 18.56

7 ICO 294.69 0.48 253.81 38.99 - - 1.89

8 JFA 113.46 0.19 10.60 102.82 - - 0.04

9 FP 101.41 0.17 70.26 29.15 - - 1.99

10 KFAED 65.35 0.11 57.11 8.47 - - (0.23)

11 SOCIETE GEN 63.32 0.10 61.93 1.18 - - 0.22

12 KBC 48.42 0.08 46.48 - - - 1.94

13 Fortis Bank 16.38 0.03 16.08 - - - 0.31

14 Belgian 12.26 0.02 12.10 - - - 0.16

15 Artigiancassa 0.53 0.00 - 0.53 - - 0.00

16 SIDA - 0.00 - - - - -

Commercial 3,622.39 5.93 2,767.73 797.18 5.77 24.78 26.94

1 CEXIM 1,651.98 2.70 1,226.96 406.25 - 23.79 (5.02)

2 BAC 714.52 1.17 522.50 170.03 1.30 - 20.70

3 FP 480.40 0.79 340.62 132.33 4.47 0.99 1.99

4 NIB 314.54 0.51 306.74 7.81 - - -

5 RZOA 216.31 0.35 161.60 50.56 - - 4.16

6 ERSTE 105.20 0.17 77.49 25.51 - - 2.20

7 ING Bank 76.63 0.13 74.72 0.37 0.00 - 1.54

8 Fortis Bank 36.37 0.06 34.12 1.79 - - 0.46

9 BNP PARIBAS 23.66 0.04 22.98 - - - 0.69

10 ICO 2.54 0.00 - 2.54 - - 0.00

11 NDF 0.23 0.00 - - - - 0.23

Multilateral 31,679.12 51.83 24,011.26 7,218.06 82.81 116.38 250.61

1 ADB 17,371.23 28.42 14,000.10 3,114.82 80.57 17.08 158.67

2 IBRD 13,919.75 22.77 9,709.29 4,032.94 2.24 99.30 75.98

3 IFAD 237.31 0.39 199.11 27.26 - - 10.93

4 OPEC 135.11 0.22 90.53 43.05 - - 1.53

5 NDF 15.73 0.03 12.23 - - - 3.50

Other

Charges

0.00 - less than five thousand

Table XX - Debt Service Expenditures by Creditor

Particulars

Amount (in million pesos)

Total % to

TotalPrincipal Interest

Commit-

ment Fee

Guaranty

Fee

27

GRAND TOTAL 61,124.03 100.00 45,274.97 12,976.92 165.94 658.42 2,047.77

51,018.34 83.467 37,698.59 11,090.61 154.70 72.65 2,001.79

100.00 73.89

NG-Direct 49,201.80 80.50 36,362.56 10,812.65 154.70 - 1,871.88

1 DOF 18,578.66 30.40 13,755.20 4,551.88 2.77 268.80

2 DPWH 8,956.60 14.65 6,400.48 1,830.35 33.81 - 691.96

3 DECS 3,300.94 5.40 2,537.68 715.83 - 47.43

4 DAR 2,690.65 4.40 2,020.98 487.48 4.77 177.43

5 DSWD 2,602.84 4.26 1,760.17 817.68 24.00 0.99

6 DOTr 2,152.14 3.52 1,376.27 404.98 28.98 341.91

7 DOE 1,502.52 2.46 1,159.77 168.04 25.82 148.88

8 DA 1,499.02 2.45 1,181.34 295.06 - 22.61

9 NIA 1,489.89 2.44 1,071.56 349.32 2.39 66.61

10 DOH 1,263.27 2.07 1,017.70 230.77 0.09 14.71

11 SC 1,189.52 1.95 1,045.00 125.38 - 19.13

12 DENR 794.68 1.30 649.50 120.45 10.90 13.83

13 BOC 696.23 1.14 580.11 123.75 - (7.63)

14 DILG 558.14 0.91 414.53 133.08 - 10.53

15 NPC 490.78 0.80 331.25 153.08 4.47 1.99

16 ARMM 357.95 0.59 270.92 79.63 - 7.39

17 Deped 245.33 0.40 114.11 104.20 14.40 12.62

18 PRRC 214.93 0.35 188.74 24.35 - 1.84

19 TESDA 147.07 0.24 112.34 30.47 - 4.26

20 BFAR 127.25 0.21 109.56 13.90 - 3.79

21 DTI 81.36 0.13 76.04 3.86 - 1.46

22 PG-LDN 75.76 0.12 53.03 15.85 - 6.88

23 BIR 34.80 0.06 26.34 8.02 - 0.44

24 DA 33.84 0.06 29.45 3.63 - 0.76

25 DOT 33.37 0.05 25.11 5.32 - 2.93

26 LLDA 23.75 0.04 17.02 6.67 - 0.07

27 BFP 16.77 0.03 - 5.54 1.30 9.93

28 UP 16.30 0.03 15.58 0.79 - (0.08)

29 PMMA 15.33 0.03 12.59 2.52 - 0.21

30 OP 11.12 0.02 10.19 0.74 - 0.20

31 OCD 0.99 0.00 - - 0.99 0.00

0.00 -

NG-Guaranty - 0.00 - - - 0.00

1 0.00 -

2 0.00 0.00

NG-Relent 1,816.54 2.97 1,336.02 277.96 - 72.65 129.91

1 LRTA 1,319.62 2.16 981.90 142.92 - 72.65 122.15

2 LBP 206.38 0.34 192.04 11.00 - - 3.34

3 PHIVIDEC 123.93 0.20 106.14 13.69 - - 4.10

4 NFA 113.46 0.19 10.60 102.82 - - 0.04

5 SBGFC 35.99 0.06 28.49 7.21 - - 0.28

6 MWSS 17.16 0.03 16.84 0.31 - - -

10,105.69 16.533 7,576.39 1,886.31 11.24 585.77 45.98

NG-Guaranteed 10,105.69 16.53 7,576.39 1,886.31 11.24 585.77 45.98

1 DBP 2,903.55 4.75 2,307.39 588.91 7.02 - 0.23

2 LBP 2,344.03 3.83 1,807.65 295.47 2.11 236.46 2.35

3 BCDA 1,217.45 1.99 842.15 203.99 - 169.74 1.57

4 MWSS 1,047.91 1.71 751.49 263.42 - 29.44 3.55

5 NFA 1,032.09 1.69 707.43 322.55 - - 2.10

6 SBMA 457.17 0.75 344.58 56.03 - 56.55 -

7 PPA 401.82 0.66 276.66 85.96 - 39.20 0.00

Table XXI - Debt Service Expenditures by Implementing Agencies

Particulars


Total % to


Commit-

ment Fee

Guaranty

Fee

Other

Charges

Paid by BTr

Paid by GOCCs

% to Total 26.11

28


Of the total debt service expenditures for the year, 36.79 percent were payments for loans availed by the infrastructure sector as presented in Table XXII

3.6 Outstanding Balance – P870.27 billion (US$17.49 billion)

As of December 31, 2016, ODA loans have outstanding balance of P870.27 billion (US$17.49 billion) which increased by P66.46 billion (US$0.43 billion) compared with last year’s balance of P803.81 billion (US$17.06 billion). The increase was due to adjustments, revaluation of foreign currency and availments and repayments during the year. The details are shown in Table XXIII.

3.6.1 By Type of Creditor

As to type of creditor, balances from Multilateral creditors represents 57 percent of the total balances. The outstanding balances to lenders by type of creditors are presented in Chart VIII.

8 LWUA 286.99 0.47 231.33 54.73 0.93 - 0.00

9 LRTA 184.68 0.30 145.03 - - 39.65 0.00

10 SBGFC 176.62 0.29 122.91 5.54 - 11.99 36.17

11 PTA

(TIEZA)

39.26 0.06 29.59 6.94 - 2.73 -

12 PEZA 14.12 0.02 10.18 2.75 1.19 - -

(Table XXI, continued)

Particulars


Total % to


Commit-

ment Fee

Guaranty

Fee

Other

Charges


1 Infra. 22,489.67 36.79 16,312.36 4,196.15 102.60 538.24 1,340.32

2 SRCD 13,010.25 21.29 8,574.69 4,265.00 42.26 - 128.30

3 GID 12,150.42 19.88 9,745.24 2,110.15 1.30 - 293.74

4 AARNR 8,958.04 14.66 6,760.10 1,903.06 19.25 48.50 227.13

5 ITT 4,515.64 7.39 3,882.59 502.57 0.53 71.67 58.29

Total 61,124.03 100.00 45,274.97 12,976.92 165.94 658.42 2,047.77

74.07 21.23 0.27 1.08 3.35% to Total


Table XXII - Debt Service Expenditures by Project Sector

Particulars


Total % to


Commit-

ment Fee

Guaranty

Fee

Other

Charges

US$ PHP

17.06 803.81 92.36

Adjustments 0.03 1.51 0.17

Forex Revaluation 0.11 50.52 5.81

CY Availments and Repayments 0.29 14.42 1.66

17.49 870.27 100.00

0.43 66.46 8.27

Balance as of December 31, 2016

Increase

Table XXIII - Changes on Loan Outstanding Balance

Particulars Amount (in billion) % to

Total

Balance as of December 31, 2015

Add/(deduct):

29

Chart VIII – Outstanding Balance by Creditor Type (in billion peso)

The specific creditors by type are presented in Table XXIV.

Creditor US$ PHP % to Total

Total 17.49 870.27 100

Multilateral 9.97 496.42 57

Bilateral 7.06 351.38 40

Commercial 0.45 22.47 3

Total 17.49 870.27 100

US$ PHP % to Total

17,486.16 870,268.92 100.00

7,060.24 351,381.30 40.38

1 JICA 5,995.26 298,377.90 34.29

2 AFD 306.91 15,274.45 1.76

3 BNP PARIBAS 208.60 10,381.58 1.19

4 KEXIM 180.71 8,993.71 1.03

5 KFW 120.74 6,008.95 0.69

6 USPL 110.74 5,511.25 0.63

7 ICO 72.30 3,598.28 0.41

8 FP 23.22 1,155.53 0.13

9 ECGD 11.92 593.27 0.07

10 Artigiancassa 6.90 343.43 0.04

11 SOCIETE GEN 6.33 315.10 0.04

12 Belgian 6.11 304.28 0.03

13 KBC 5.70 283.79 0.03

14 KFAED 2.52 125.21 0.01

15 JFA 2.30 114.57 0.01

Multilateral 9,974.40 496,415.82 57.04

1 ADB 5,267.23 262,144.61 30.12

2 IBRD 4,573.78 227,632.48 26.16

3 IFAD 91.37 4,547.21 0.52

4 OPEC 31.10 1,547.92 0.18

Total

Bilateral

Table XXIV - Outstanding Balances by Specific Creditor (in Million)

Creditor

30


The Project Sector with the highest outstanding balances is the SRCD sector while the Industry, Trade and Tourism (ITT) sector has the lowest outstanding balances as graphically presented in Chart IX.

Chart IX – Number of Loans and Outstanding Balances by Sector


The first five loans under each project sector with big outstanding balances are presented in Table XXV.

US$ PHP % to Total

5 NDF 10.92 543.59 0.06

Commercial 451.52 22,471.80 2.58

1 CEXIM 296.93 14,777.77 1.70

2 BAC 91.13 4,535.49 0.52

3 RZOA 20.37 1,013.92 0.12

4 ICO 16.44 818.12 0.09

5 ERSTE 13.47 670.27 0.08

6 Bancaja 4.96 246.92 0.03

7 BNP PARIBAS 3.52 175.36 0.02

8 FP 3.36 167.26 0.02

9 Fortis Bank 0.70 34.73 0.00

10 NDF 0.64 31.96 0.00

(Table XXIV, continued)

Creditor

2015 2016 2015 2016

ITT 146 148 38.80 37.84

AARNR 77 78 92.91 96.59

GID 19 19 115.98 112.50

Infra. 18 18 252.25 269.07

SRCD 64 65 303.87 354.27

Total 324 328 803.81 870.27

Project SectorNo. of loans Outstanding Balance

31

US$ PHP

17,486.16 870,268.92 100.00

5,406.45 269,073.72 30.92

1 PH-P226 Subic-Clark-Tarlac Expressw ay

ProjectBCDA JICA 405.30 20,171.39 2.32

2 2282 PHI Pow er Sector Development

Program ClusterDOF ADB 251.78 12,530.59 1.44

3 PH-P243 Environmental Development Project DBP JICA 211.04 10,503.10 1.21

4 7552 PH National Roads Improvement and

Management Project 2DPWH IBRD 170.69 8,495.02 0.98

5 PH-P245 Logistics Infrastructure

Development ProjectDBP JICA 164.99 8,211.39 0.94

2,260.47 112,501.57 12.93

1 2840-PHI Governance in Justice Sector

Reform Program- Subprogram 2DOF ADB 270.94 13,484.63 1.55

2 7913-PH

Food Crisis Response Development

Policy Operation: Supplemental

Support for Post-typhoon Recovery

DECS IBRD 250.00 12,442.25 1.43

3 2489 PHI Governance in Justice Sector

Reform ProgramSC ADB 215.21 10,710.74 1.23

4 7424 PH First Development Policy Loan

ProgramIBRD 208.30 10,366.88 1.19

5 2450 PHI Development Policy Support

Program Cluster-Sub Program 2ADB 204.98 10,201.53 1.17

1,940.67 96,585.31 11.10

1 PH-CL 020MM Air Quality Improvement Sector

Development ProgramJICA 227.75 11,335.01 1.30

2 7615 PH Food Crisis Response Development

PolicyIBRD 200.00 9,953.80 1.14

3 PH-P199 Environmental Infrastructure

Support Credit Program, Phase IIDBP 131.66 6,552.79 0.75

4 PH-P242 Agrarian Reform Infrastructure

Support Project, Phase IIIDAR 99.27 4,940.76 0.57

5 8421-PH Phil. Rural Development Projects DA IBRD 81.88 4,074.92 0.47

7,118.22 354,266.82 40.71

1 3080-PHI

Emergency Assistance for Relief

and Recovery from Typhoon

Yolanda

DOF ADB 500.00 24,884.50 2.86

1 8085-PH DISASTER RISK MGMT.DEV. W/

CATDOF 500.00 24,884.50 2.86

2 8328-PH

Second Development Policy Loan to

Foster Inclusive Grow th:

Supplemental Financing for Post-

Typhoon Recovery and Amendment

to the Original Loan Agreement

DOF 500.00 24,884.50 2.86

3 PH-SB1 Post Disaster Stand- by Loan DOF JICA 425.25 21,164.27 2.43

4 7805-PH Social Welfare and Development

Reform ProjectDSWD IBRD 405.00 20,156.45 2.32

5 2662 PHI Social Protection Support Project DSWD 392.24 19,521.51 2.24

5 3233-PHI Increasing Competitive for Inclusive

Grow th Program-Subprogram 2DOF 350.00 17,419.15 2.00

760.34 37,841.49 4.35

1 PH-P198 Industrial Support Services

Expansion Program, Phase IIDBP JICA 226.15 11,255.01 1.29

Total Outstanding Balance

Infrastructure

Governance and Institution Development

Agriculture, Agrarian Reform and Natural Resources

Table XXV - Five Loans under each Project Sector with big Outstanding Balances (in million)

Loan Account

NumberName of Project IA Creditor

Amount % to

Total

Social Reform & Community Development

Industry, Trade and Tourism

JICA

DOF

DOF

IBRD

ADB

32

3.6.3 By Government Sector

The loan balances by government sector with the NGAs having the highest outstanding balance representing 81.85 percent of the total loan balances are shown in Table XXVI.

3.6.4 By Implementing Agencies

Below is Table XXVII showing the loan balances by implementing agencies with the

DOF and DPWH having the highest outstanding balances representing 42.38 percent and 12.33 percent of total loan balances.

US$ PHP

2 2278 PHI Financial Market Regulation &

Intermediation Program ClusterDOF ADB 111.90 5,569.15 0.64

3 PH-P189 Domestic Shipping Modernization

Program, Phase IIDBP JICA 96.97 4,826.34 0.55

4 2199 PHI Microfinance Development Program DOF ADB 77.79 3,871.53 0.44

5 4833 PH Support for Strategic Local

Development & Investment ProjectLBP IBRD 46.38 2,308.24 0.27

(Table XXV, continued)

Loan Account

NumberName of Project IA Creditor

Amount % to

Total

US$ PHP

16 11 51 78 3,095.43 154,056.26 17.70

5 5 78.77 3,920.48 0.45

245 245 14,311.96 712,292.18 81.85

266 11 51 328 17,486.16 870,268.92 100.00

PhP 733,462.94 21,395.99 115,401.69 870,260.62

US$ 14,737.35 430.07 2,318.75 17,486.16


Table XXVI - Outstanding Balances by Government Sector (in million)

Implementing

AgencyNG Direct

NG- Relent

loans

NG

Guaranteed

Total No.

of Loans

Amount

(in million)% to

Total

GOCCs

LGUs

NGAs

Total

Amount

in Million

US$ PHP

328 17,486.16 870,268.92 100.00

245 14,311.96 712,292.18 81.85

1 DOF 37 7,410.43 368,809.83 42.38

2 DPWH 65 2,156.83 107,343.36 12.33

3 DSWD 8 1,449.35 72,132.59 8.29

4 DECS 11 581.27 28,929.16 3.32

5 DOTr 25 527.34 26,245.05 3.02

6 DAR 19 515.51 25,656.33 2.95

7 DA 20 367.56 18,293.11 2.10

8 Deped 3 240.84 11,986.47 1.38

Table XXVII - Outstanding Balances by IAs (in million)

Total Oustanding Balance

NGAs

No. of

Loans Creditor % to Total

Outstanding Balances

33

US$ PHP

9 SC 2 226.64 11,279.47 1.30

10 DOH 12 166.61 8,292.16 0.95

11 DOE 3 147.83 7,357.52 0.85

12 DENR 12 118.84 5,914.39 0.68

13 BOC 2 113.17 5,632.42 0.65

14 DILG 6 61.35 3,053.30 0.35

15 OCD 1 52.33 2,604.16 0.30

16 PRRC 2 47.63 2,370.73 0.27

17 BFAR 5 40.82 2,031.81 0.23

18 TESDA 4 26.93 1,340.48 0.15

19 BFP 1 21.45 1,067.38 0.12

20 DOT 1 13.36 664.94 0.08

21 PMMA 1 6.57 326.97 0.04

22 BIR 1 5.59 277.97 0.03

23 DTI 1 5.43 270.43 0.03

24 UP 1 5.29 263.33 0.03

25 OP 2 2.99 148.81 0.02

GOCCs 78 3,095.43 154,056.26 17.70

1 DBP 17 948.44 47,202.72 5.42

2 LBP 14 466.44 23,214.01 2.67

3 LRTA 7 420.68 20,936.77 2.41

4 BCDA 1 405.30 20,171.39 2.32

5 NIA 12 328.99 16,373.51 1.88

6 MWSS 3 136.45 6,791.15 0.78

7 SBMA 3 109.56 5,452.84 0.63

8 PPA 2 74.56 3,710.94 0.43

9 LWUA 5 55.23 2,748.82 0.32

10 PHIVIDEC 1 54.16 2,695.49 0.31

11 SBGFC 3 38.47 1,914.78 0.22

12 PNR 2 29.54 1,470.08 0.17

13 NPC 2 12.62 628.06 0.07

14 PTA (TIEZA) 1 5.04 250.95 0.03

15 LLDA 2 5.00 248.72 0.03

16 NFA 2 2.61 130.12 0.01

17 PEZA 1 2.33 115.92 0.01

LGUs 5 78.77 3,920.48 0.45

1 ARMM 4 63.23 3,147.02 0.36

2 Provl Gov't-LDN 1 15.54 773.45 0.09

(Table XXVII, continued)

No. of

Loans Creditor % to Total

Outstanding Balances

4.0 AUDIT OBSERVATIONS

AND

RECOMMENDATIONS

34

4.0 Audit Observations and Recommendations

As of 2016, a total of 449 (including seven cancelled loans) ODA loans were

extended to 26 National Government Agencies, 20 Government Owned and Controlled Corporations, and two Local Government Units (Table XI) for the implementation of 337 projects and 67 programs. Of the total projects and programs, 328 were completed, 53 on-going, 12 were cancelled while 11 were not yet implemented.

As at year end, 14 loans contracted from 2013 to 2016 have no availments yet, 100

were fully paid while 328 loans have outstanding balances of ₱870.27 billion (US$17.49

billion) under the five sectors (Chart IX) namely: 1. Social Reform and Community Development - with the highest outstanding

balance of ₱34.27 billion from 65 loan accounts. 2. Infrastructure – with total outstanding balance of ₱269.07 billion from 18 loan

accounts. 3. Governance and Institution Development - with total outstanding balance of

₱112.50 billion from 19 loan accounts. 4. Agriculture, Agrarian Reform and Natural Resources – with total outstanding

balance of ₱96.59 billion from 78 loan accounts. 5. Industry, Trade and Tourism –with outstanding balance of ₱37.84 billion from

148 loan accounts.

Audit observations and issues were noted on fund utilization and project

implementation by 12 implementing departments/agencies which are included in the Annual Audit Reports of the concerned agency and summarized herein categorized as:

1. Agency- specific Observations and Recommendations - presented on pages 35

to 76 by department/agency.

2. Common Audit Observations - grouped by issues presented on pages 77 to 81.

35

4.1.1

Source: http://www.dswd.gov.ph/

VISION

The Department of Social Welfare and

Development envisions all Filipinos free from

hunger and poverty, have equal access to

opportunities, enabled by a fair, just, and

peaceful society.

MISSION

To lead in the formulation, implementation,

and coordination of social welfare and

development policies and programs, for and

with the poor, vulnerable, and

disadvantaged.

Core Values and DSWD Brand

Maagap at Mapagkalingang Serbisyo

Serbisyong Walang Puwang sa Katiwalian

Patas na Pagtrato sa Komunidad

Organizational Outcomes

1. Well-being of poor families improved

2. Rights of poor and vulnerable sectors

promoted and protected

3. Immediate relief and early recovery of

disaster victims/survivors ensured

4. Continuing compliance of social welfare

and development (SWD) agencies to

standards in the delivery of social welfare

services ensured

5. Delivery of social welfare and

development (SWD) programs by local

government units (LGUs), through local

social welfare and development offices

(LSWDOs)

36

As of December 31, 2016, the Department availed nine loans to implement seven projects, two of which are still on-going and two are not yet implemented (NYI). Table XXVIII below, presents the status of these projects and the loan summary profile with CNLC amounting to ₱137.40 billion (US$2.76 billion).

Table XXVIII - Project Status and Loan Summary Profile (Amounts in Million)

Audit of the three projects resulted in a number of deficiencies.

Table XXIX - List of Project Loans with Audit Observations (Amounts in Million)

AUDIT OBSERVATIONS and RECOMMENDATIONS

Audit Observations Recommendations

A. KC-NCDDP – Asian Development Bank (ADB) & World Bank (WB)

Project Monitoring

1. Project implementation was not closely

monitored and supervised resulting in unresolved project issues which adversely affected the effectiveness and efficiency of the project and reliability of reports.

a. The implementation of 13 sub-projects amounting to ₱35.097 million were either delayed or found deficient, or not maintained and protected due to failure of Regional Project Management Office/Sub-Regional Project Management Office (RPMO/SRPMO) and project proponents to monitor project activities and resolve project issues. Among the noted issues are delayed and/or failure to download funds, breach

a. Closely monitor, supervise and provide technical assistance and immediate solution to the defects/deficiencies noted. (OSEC, VII & XI);

b. Strictly implement the provision of storage facilities before the delivery of construction materials at the site to secure these materials (OSEC);

c. Hold accountable persons who are

remiss in the monitoring and evaluation of sub-projects (OSEC & VII);

USD PHP USD PHP USD PHP USD PHP

9 TOTAL 7 2,760.82 137,403.36 1,508.66 75,084.43 98.55 4,904.55 1,252.16 62,318.93

3 Ongoing 2 1,251.10 62,266.19 847.82 42,194.92 79.50 3,956.44 403.29 20,071.27

4 Completed 3 659.72 32,833.52 659.72 32,833.52 17.93 892.12 - -

2 NYI 2 850.00 42,303.65 1.13 55.99 1.13 55.99 848.88 42,247.66

CY Availments Undrawn BalanceLoan

CountProject Status

Project

Count

CNLC Cumulative Availments


TOTAL 1,756.10 87,399.53 1,352.82 67,328.27 97.42 4,848.56 403.29 20,071.27

8218-PH Completed 100.00 4,976.90 100.00 4,976.90 0.88 43.91 - -

IBRD 7805-PH Completed 405.00 20,156.45 405.00 20,156.45 17.04 848.21 - -

3100-PHI Ongoing 372.10 18,519.24 228.87 11,390.40 9.16 455.65 143.24 7,128.84

8335-PH Ongoing 479.00 23,839.35 219.98 10,948.12 66.08 3,288.86 259.02 12,891.24

ADB2662 PHI SPSP Ongoing 400.00 19,907.60 398.97 19,856.40 4.26 211.92 1.03 51.20

SWDRP

KC-NCDDP

CY Availments Undrawn BalanceProject

NameLoan No.

Project

Status


37


of contract by the contractor, construction not in accordance with the program of works, absence of proper storage resulting in missing materials and equipment, absence of maintenance and/or existence of uncompleted or non-functional facilities, absence of transportation facilities and unmaintained road network.

d. Coordinate with government agencies

with expertise in the design of construction of specific sub-projects and activate the Project Monitoring and Evaluation Committee to confirm proper turn-over of projects to Local Government Units (LGUs)/registered People’s Organization (POs). (FO XI);

b. The accuracy of the reported project

accomplishments is questionable due to deficient reporting and monitoring mechanism of projects. Upon validation, the community grant reported by Barangay Sub-project Management Committee (BSPMC) amounting to ₱172.342 million is different from the report of KC-NCDDP with a variance of ₱4.136 million. (FO IV, V, VI, VII, VIII, CARAGA)

a. Properly monitor the status of

implementation of sub-projects and ensure that all information/reports are accurate, complete, and consistent with program standards;

b. Determine unrecorded community grants in the KC-NCDDP Report considering the books of BSPMC.

c. The sustainability of completed projects is

at risk considering that the groups in charge of managing the projects lack the necessary trainings to be able to secure group accreditation from LGUs and technical assistance to properly utilize and maintain the projects. (KC-NCDDP – WB & ADB)

a. Conduct capacity building initiatives

and trainings to ensure that Operations & Maintenance (O&M) groups are equipped to manage sub-projects;

b. Require the O&M groups thru RPMO/Area Coordinating Team to submit necessary documents to concerned LGUs for group accreditation and technical assistance in the proper utilization and maintenance of the project;

d. Completion of 18 sub-projects amounting

to ₱30.837 million was delayed by as long as 64 calendar days due to political friction, bad weather conditions and inactive barangay volunteers. (FO XI)

Require the KALAHI-CIDSS-Area Coordinating Team and its barangay volunteers to strengthen the project monitoring in order to enhance sub-project implementation and monitoring standards.

I. Internal Control Evaluation

Internal control in the handling of unissued checks as well as processing of disbursements and releasing of checks is weak resulting in unauthorized and anomalous issuance of checks and/or payment of undocumented or insufficiently

Revisit/review current internal control procedures within the FCD and make necessary improvements. (KC-NCDDP–WB)

38


documented transactions in the total aggregate amount of ₱1,517,304.37.

a. One hundred two (102) Land Bank of the

Philippines (LBP) commercial checks were not included in the Report of Accountability for Accountable Forms for CY 2016 and cannot be presented upon request. Moreover, verification of the bank reconciliation statement disclosed that four (4) of these checks were already issued between January 24, 2015 to December 3, 2015 in amounts ranging from ₱60,000.00 to ₱111,375.00 or in the aggregate amount of ₱367,141.92. The issuance of these checks were also not included in the Report of Checks Issued for CY 2015. Worse, these checks were negotiated between July 23, 2015 to January 18, 2016. The issuance of these checks then is not only unauthorized but also anomalous. The snapshots of negotiated checks can no longer be provided by the LBP as the bank’s system can only hold snapshots for a maximum period of two months.

Submit justification/explanation for the unreported and unaccounted checks and failure to immediately report to proper authorities said condition. The transactions amounting to ₱263,250.00 were already disallowed in audit.

b. Twelve (12) checks pertaining to different

payees as reflected in the disbursement vouchers (DVs) or without indicated payees in the DVs were all issued in the name of Raquel Ramos. These checks were issued in amounts ranging from ₱10,106.91 to ₱111,375.00 or in the total aggregate amount of ₱838,653.24. Three (3) of these checks in the aggregate amount of ₱263,250.00 were not even supported with documents.

a. Refund the amount representing

irregular disbursements amounting to ₱1,060,853.44;

b. Conduct investigation and initiate

legal action against erring employees;

c. Transactions amounting to

₱838,653.24 were already disallowed in audit.

c. Three (3) other checks issued in amounts

ranging from ₱58,305.28 to ₱103,891.92 or in the aggregate amount of ₱222,200.20 were not supported with documents. Thus, validity of transactions cannot be assessed. There were even two payments amounting to ₱162,197.20 that appeared to have been already paid, which tantamount to double payments.

II. Compliance with Existing Rules and Regulations

1. Existing rules and regulations governing the

39


projects and financial transactions were not strictly observed as discussed in next page:

a. Brand names of cement were indicated in

the Purchase Request, Request for Quotation, Abstract of Canvass/Quotation and in the Purchase Order of some projects contrary to existing laws, rules, and regulations. (FO XII)

Advice the Procurement Team to avoid using brand names when requisitioning for goods.

b. Fund transfers to various Non-

Government Organizations/People’s Organizations (NGOs/POs) were not liquidated resulting in the accumulation of the balance of the account to approximately ₱3.6 billion or 34 percent of the total community grants as of year-end.

a. Demand NGOs/POs to submit

liquidation reports and refund any unutilized balance, particularly those with long-outstanding dormant balances; and comply with existing guidelines and the provision of the MOA/Agreement.

2. Hiring of technical service providers

(TSPs)/Kalahi Specialists and consultants and payments thereto were not properly managed as manifested below:

a. During the years 2015 and 2016, DSWD

employed three (3) and sixteen (16) TSPs with service costs aggregating ₱1.281 million and ₱10.140 million, respectively, to assist in the implementation of the program. The employment of TSPs was, however, not covered by contract of service and did not pass through BAC evaluation. Although the payments were supported with terms of reference, among others, the same cannot be considered as a contract. Moreover, payments were effected without certification to the effect that the technical documents submitted by the TSPs were properly reviewed, evaluated and accepted by the end users for being in accordance with the terms of reference. The certification attached as basis for payment merely contains the deliverables under the Terms of Reference such as the need to conduct field surveys, design calculations and not the period of actual activities undertaken and corresponding outputs thereon such as field survey results, results of analysis, design calculation, and estimated costs. Certifications prepared were noticeably pre-formatted that the preparer only

Require the RD to issue memorandum prescribing stringent processes on selection of TSPs/ consultants to include evaluation of TSPs by BAC. Likewise, revisit the policy of hiring TSPs considering available personnel, as well as payments for their services which should be based on actual undertaking validated and certified by responsible agency officials.

40


changes the name and the project location.

b. Salaries of KALAHI Specialists/

Consultants were increased without rebidding conducted nor stipulations in the Terms of Reference.

RD to coordinate with CO on the guidelines relative to increasing salaries of consultants without the benefit of rebidding and to revisit the need for consultants/specialists. The Staff Selection Committee (SSC) should conduct annual performance evaluation as basis of rehiring consultants.

B. Social Welfare and Development Reform Project (SWDRP); Social Protection Support Project (SPSP) (WB)

Financial and Operational Management

1. The financial management of funds intended

for 4Ps’ beneficiaries needs improvement to assess the actual funds available for the program. Among the problems encountered in fund management follows:

a. Unclaimed cash grants of 4Ps

beneficiaries for CYs 2013 to 2016 in the total amount of P3.108 billion refunded by LBP conduits were not returned to the Bureau of Treasury in violation of Section 88 of the General Provisions of the General Appropriations Act.

a. Remit to the BTr the amount

refunded by the conduits of LBP;

b. Establish guidelines considering the period of claiming cash grants, after which the grants are forfeited in favor of the government and remitted to the BTr for proper disposition.

b. Payments to LBP in the total amount of

₱102,877,124.00 representing financial expenses (for cash card withdrawal, and manpower and other expenses) for CYs 2014 and 2015 were not duly supported contrary to Section 4, paragraph 6 of PD 1445 and COA Circular No. 2012-001. Moreover, while LBP does not charge its regular customers fees for withdrawal from LBP ATM, it is charging DSWD ₱14.00 for every successful cash card withdrawal by 4Ps’ beneficiaries not to exceed six (6) withdrawals.

Submit original copies of the MOA, and Supplemental MOA, Bank Debit Memos showing the Bank Account credited, and ORs evidencing receipt of payment by LBP; and justification on the charging of ₱14.00 for every cash card withdrawal made by 4Ps beneficiaries.

c. Fund transfers to LBP as cash grants to

4Ps beneficiaries for the period 2012 to 2016 amounting to ₱7.659 billion remained unliquidated as of December

Comply strictly with the guidelines on the grant, use and liquidation of fund transfers, and the provisions of the MOA. Make strong representation

41


2016. As required in the MOA, LBP shall submit liquidation documents within five (5) working days from the last date of scheduled pay-out. The status of unliquidated funds is therefore unclear.

with the LBP to submit liquidation reports; and refund any unexpended balance.

d. Unwithdrawn balances in 2,646,577

accounts of 4Ps’ beneficiaries ranged from ₱501.00 to ₱50,000.00 or in the aggregate amount of ₱1.426 billion. Of the amount, ₱1.239 million or 87 percent were unwithdrawn from 30 to 2,190 days. This condition manifests that some 4Ps’ beneficiaries were not actually in need of financial assistance.

a. Fast track validation, investigation/re-

assessment of the eligibility of concerned beneficiaries and immediately delist ineligible beneficiaries;

b. Coordinate the results of validation with LBP for them to recover the corresponding amount for remittance to the BTr;

c. Advise the LBP of 4Ps’ beneficiaries

with “No DLMA” status to ensure that additional expenditures are avoided and government funds are not wasted.

e. Cash advances (CAs) drawn for time-

bound activities were not liquidated within the prescribed period resulting in the accumulation of balance of Advances to SDO with a corresponding effect of understating the current year expenses. Based on liquidation reports submitted during CY 2016, the average delay in liquidation is 101 days. (FO V)

a. Require the SDOs to immediately

settle all outstanding CAs which are already due for liquidation;

b. Strictly monitor the due dates and regularly issue demand letters to require settlement thereof;

c. SDOs and/or AOs to observe

deadline set on the liquidation of CAs;

d. Field offices to set a deadline, within

which beneficiaries/payees may claim the amounts due to them, otherwise include them in the next payroll/pay-out, if possible.

f. Copies of 1,945 perfected narrative

contracts/ POs/MOAs/JOs for CY 2016 were not submitted to the Office of the Auditor within five (5) working days upon approval, together with its supporting documents as required under Section 3.1.1 of COA Circular No. 2009-001 and related COA issuances. Thus, the technical, legal and auditorial review of such contracts to ascertain their validity

Submit contracts and supporting documents to the Office of the Auditor to avoid penalties provided under COA Circular No. 2009-001, and prepare PO as provided under the GAM, Volume II.

42


and regularity cannot be undertaken on a timely basis. Furthermore, POs were not properly prepared as required under Appendix 61 of the Government Accounting Manual (GAM), Vol. II.

2. Implementing policies on the management of

grants were not strictly followed. Children below age of majority were allowed to receive the grant, and were even required to sign the receipt portion of the payroll in violation of laws, rules and regulations. (SWDRP & SPSP - FO X)

Issue a memorandum to the PPRPC and the Provincial/Municipal/City Links enforcing strict monitoring of the program particularly on the eligibilities of recipients of grants.

III. Reliability of FS Accounts covering both projects

1. The balance of a number of FS accounts

cannot be relied upon due to, among others:

Project Accounts Particulars Amount (In M. ₱)

SWDRP KC-NCDDP

Due from BIR

1. Existence of negative SL balances and erroneous recording of tax remittances which may be due to over remittance of taxes, mispostings, double posting,

2. Unreconciled

balances of GL and Schedule of Actual Tax Withheld and Remitted pertaining to prior period.

0.599

SWDRP; SPSP; KC-NCDDP – WB

Cash In Bank-Local Currency Current Account (CIB-LCCA)

The preparation of BRS is either delayed or BRS not at all prepared, thus, any items for adjustment cannot be established. (FOs I, III) In addition, the following adjustments were not effected: - Stale checks were

not restored; (FO III)

a. Review the process flows of

documents and transactions, and devise a system whereby the work of one automatically checks the work of another to ensure complete and accurate recording and reporting of financial transactions;

b. Examine the account to determine the reasons for negative and unreconciled balances and take necessary adjusting entries.

a. Prepare the BRS for all agency bank accounts and effect any necessary adjusting/correcting entries; and submit the BRS within 15 days after the end of the month to the Office of the Auditor for verification; (FOs I, III)

b. Restore the amount of stale checks

to Cash in Bank - LCCA; (FO III)

43


Project Accounts Particulars Amount (In M. ₱)

- Issued checks were

cancelled without validating if the same remained outstanding or not yet negotiated in the month previous to cancellation; (FO III)

- Long outstanding book reconciling items not recorded in the books. (FO III)

0.905

0.194

0.351

c. Review the reported cancelled checks and the corresponding journal entries made and prepare the necessary adjustments, if warranted; (FO III) and

d. Exert extra care in the analysis of

transactions to avoid double cancellation of checks. (FO III)

44

4.1.2

POWERS AND FUNCTIONS

The powers and functions of NIA under RA 3601, as amended by PD 552 and PD 1702, include the following:

1) To investigate, study, and develop all available water resources in the country,

primarily for irrigation purposes;

2) To plan, design, construct, and/or improve all types of irrigation projects and

appurtenant structures;

3) To operate, maintain, and administer all national irrigation systems (NIS);

4) To supervise the operation, maintenance, and repair, or otherwise, administer

temporarily all communal and pump irrigation systems constructed, improved,

and/or repaired wholly or partially with government funds;

5) To delegate the partial or full management of NIS to duly organized cooperatives or

associations;

6) To construct multiple-purpose water resources projects designed primarily for

irrigation, and secondarily for hydraulic power development and/or other uses such

as flood control, drainage, land reclamation, domestic water supply, roads and

highway construction, and reforestation, among others, Provided, that the plans,

designs, and the construction thereof, shall be undertaken in coordination with the

agencies concerned;

7) To charge and collect from the beneficiaries of the water from all irrigation systems

constructed by or under its administration, such fees or administration charges as may be necessary to:

cover the cost of operation, maintenance, and insurance;

recover the costs of construction within a reasonable period of time to the

extent consistent with government policy;

recover funds or portions thereof expended for the construction and/or

rehabilitation of communal irrigation systems (CIS) which shall accrue to a special fund for irrigation development.

Source: http://www.nia.gov.ph/

http://www.lawphil.net/statutes/repacts/ra1963/ra_3601_1963.html

http://www.lawphil.net/statutes/presdecs/pd1974/pd_552_1974.html

http://www.nia.gov.ph/PD1702.pdf

45

NIA availed 13 loans to finance the construction of 12 irrigation projects, nine of which

were reportedly completed as of December 31, 2016. The status of the 12 projects and the

summary of loans profile are shown in Table XXX.

Table XXX - Project Status and Summary of Loans Profile (Amounts in Million)

Audit of three on-going and three completed projects resulted in a number of deficiencies.

Table XXXI - List of Project Loans with Audit Observations (Amounts in Million)



I. Project Performance Evaluation

1. Completion of four projects within the loan

expiration date is at risk due to delays in project implementation and procurement activities, and granting of time extensions without proper evaluation. These factors in effect deprived the farmer-beneficiaries of improved irrigation facilities on time:

a. Projects not implemented on time and/or

terminated:

Project Name

No. of Projects affected

Amount In Bill ₱

Condition/Reasons

PIDP 1 0.425 Terminated

12 1.459 Construction delayed by 316 to 939 calendar days, of which 6 granted with time extensions of

Project No. of Amount Condition/Reasons

a. Act with dispatch in resolving

existing issues/problems that are currently hampering/ delaying the prosecution and/or completion of projects;

b. Fast track procurement of remaining contracts and act with dispatch to address the cause of the delay in the implementation of on-going contracts;

c. Impose liquidated damages for

late delivery of civil works. Conduct investigation to determine persons responsible for non-imposition of liquidated damages; and file appropriate


13 TOTAL 12 748.88 37,270.92 500.13 24,891.20 7.00 348.35 248.74 12,379.72

4 Ongoing 4 345.78 17,209.13 97.35 4,844.87 7.00 348.35 248.43 12,364.26

9 Completed 8 403.10 20,061.79 402.79 20,046.33 - - 0.31 15.47

CY Availments Undrawn BalanceLoan Count Project Status

Project

Count



TOTAL 482.48 24,012.47 233.73 11,632.75 7.00 348.35 248.74 12,379.72

CHI-6 ARIIP Completed 89.15 4,437.09 88.84 4,421.63 - - 0.31 15.47

China Nat'l

Const.&

BPIP 30.91 1,538.49 30.91 1,538.49 - - - -

ADB1668 PHI SPISP 50.01 2,489.12 50.01 2,489.12 - - - -

IBRD 7709 PH PIDP Ongoing 70.36 3,501.75 49.86 2,481.68 4.16 206.88 20.50 1,020.06

JBIC PH-P254 NISRIP 52.62 2,618.87 8.91 443.25 2.84 141.47 43.71 2,175.62

KEXIM PHL-

15 KRW227B

JRMPP II 189.42 9,427.15 5.20 258.57 - - 184.22 9,168.58

Cumulative Availments CY Availments Undrawn BalanceLoan No.

Project

Name

Project

Status

CNLC

46

Audit Observations Recommendations Name Projects

affected In Bill ₱

67 to 505 calendar days were not able to complete the project within the revised completion date but were not imposed liquidated damages.

NISRIP 13 1.803 As of December 31, 2016, these projects were only 4.9 percent to 20.86 percent complete; far behind target completion rate of 63 percent to 74 percent. The status of the project follows: - 10 are on-going with

negative slippages of 7.2 percent to 36.20 percent;

- 2 contracts have just been mobilized; and

- 1 contract was not yet awarded.

JRMPP II

2 9.610 Civil Works Contract bidded out on May 4, 2016 was not yet awarded as at end of the year. To date, the rebidding was not yet conducted.

HCAAP 4 0.576 Work suspensions were caused by inclement weather conditions. One contract with 24.93 percent accomplishment was terminated while three others were not completed within the revised completion dates despite the grant of several contract time extensions ranging from 122 to 860 calendar days.

cases if warranted; and d. Expedite the termination

proceedings of terminated contract in accordance with the Revised IRR of RA No. 9184, specifically the forfeiture of the performance security and the inventory taking of the Contractor’s accomplishment.

b. The contract time of nine (9) PIDP projects

costing ₱1.603 billion were extended from 164 to 505 calendar days without proper evaluation and with incomplete documentation. The validity of the extension of time granted considering the General Conditions of the contract and existing laws and regulations cannot therefore be assessed.

a. Conduct investigation and

determine persons responsible in approving the grant of contract time extensions (CTEs) without the required evaluation and documentation; and file appropriate cases if warranted; and

b. Submit the approved CTE, duly evaluated and supported with complete documents.

II. Compliance with Existing Rules and Regulations

1. The provisions of RA 9184 were not strictly

observed resulting in the award of contracts to non-compliant bidders primarily due to deficient

a. BAC and its TWG to strictly

comply with the bid evaluation and post qualification

47


conduct of post qualification evaluation of bidders:

a) Eight (8) PIDP contracts costing ₱1.472 billion were awarded to the following contractors:

Contractor No. of

Contracts Amount

(in Billion ₱)

Markbilt Const. 4 1.169

Equi-Parco Construction Company

3 0.233

KYRO Builders 1 0.070

Total 8 1.472

These were awarded without proper post qualification evaluation conducted as required under the IRR of RA 9184 and the provisions of the Government Procurement Policy Board Manual of Procedures for the procurement of Infrastructure projects. Thus, the following deficiencies were not detected:

Contractor Deficiencies

Markbilt Const.

Did not present previously completed contracts similar to the contract subject of bidding with the required value. The contract presented was a contract awarded in joint venture with four other parties with Markbilt’s participation equivalent only to 16.22 percent which is not sufficient to comply with the bid requirement. The contractor also pledged the same set of equipment in these four contracts to be implemented simultaneously and same set of key project personnel in two contracts. Markbilt Construction’s performance with NIA on-going projects is unsatisfactory as it failed to complete Contract No. SJPIPDC-1 at the revised completion date despite eight contract time extensions.

Equi-Parco Construction Company

Claimed similar contract expertise is a contract awarded by DPWH to another contractor where Equi-Parco is a Sub-contractor. The sub-contract was not recognized by DPWH.

Kyro Builders

The alleged previous contract is non-existent.

procedures prescribed in the Revised IRR of RA No. 9184 and GPPB Manual of Procedures;

b. Impose on erring Contractors administrative penalty of suspension from participating in the bidding process, as well as disqualification from further participating in the public bidding being undertaken by NIA pursuant to Section 69, Rule XXIII of the IRR of RA No. 9184; and

c. Conduct investigation to

determine the persons liable and their participation in the gross violation of the procurement law, rules and regulations that resulted in the award of the Contracts to non-compliant bidders and file appropriate charges.

b) One JRMPP II contract amounting to ₱230.567

million was awarded to non-compliant bidder. The bidder has no similar completed contract equivalent to 50 percent of the ABC of the contract to be bid out, and the proposed key

a. Ensure that the conduct of

post qualification is in accordance with the procedures prescribed in the Revised IRR of RA No. 9184

48


personnels’ competence and experience pertained to non-existing contract. As a result, the project was not completed despite the grant of contract time extension of 344 calendar days. No liquidated damages were imposed for the delays incurred. The project was reported to be 34.58 percent complete and was suspended effective October 15, 2016 due to Main Canal realignment and Right of Way problem. The Contract time extension granted for 344 calendar days was not supported with complete documentation.

and GPPB Manual of Procedures for the Procurement of Infrastructure Projects.

b. Conduct investigation to

determine liability of the contractor for submitting deficient and falsified documents to support compliance with the eligibility requirements of the contract and take appropriate action.

c. Act with dispatch in resolving

the cause of delay to fast track the implementation of the project;

d. Consider terminating the contract pursuant to the Revised IRR of RA No. 9184 and General Conditions of the Contract;

e. Impose liquidated damages on

the delay incurred due to contractor’s fault; submit lacking documentation of the contract time extension; and conduct investigation to determine persons liable; and file appropriate charges if warranted.

2. Claims for Mobilization Fee/Advance Payment and

Progress Billing of Contract for the Rehabilitation/Restoration of Upper Chico River Irrigation System including supply and delivery, installation and commissioning of Steel gates in the total amount of ₱201.273 million were paid despite Contractor’s non-compliance with General Conditions of the Contract and incomplete documentations to support the delivered and paid work items. (PIDP)

Ensure payments are supported with complete documentations and the work items delivered are in accordance with the Technical Specifications of the Contract, submit lacking documents, and conduct investigation to determine persons liable.

3. Validation and assessment of the utilization of fund transfer and cash advances from SPISP for the purpose intended could not be undertaken due to absence of liquidation documents. a) Funds transferred to the DENR ROs in the total

amount of ₱8.123 million remained unliquidated

a. Reiterated previous years’ recommendation that Management coordinate with the concerned DENR ROs and take measures to address the closing of the advances/fund transfers adjustment in the

49


absence of liquidation reports

and outstanding in NIA’s books due to absence of Liquidation Reports.

b) Cash advances amounting to ₱1.539 million recorded under Advances to Officers and Employees account remained unliquidated as of December 31, 2016. Moreover, the balance was not supported with updated Subsidiary Ledgers.

b. The Accounting Division to

demand the immediate liquidation of cash advances from officers and employees.

4. Control over completed projects and equipment is

weak thereby resulting in either payment despite incomplete documentation or difficulty in establishing accountability:

a) Transfer of CIP to PPE-Water Supply System

account in the amount of ₱6.936 billion was not completely documented. Hence, accountability over the turned over assets was not clearly established. (SPISP/ARIIP)

Submit the approved completion report and physical inventory and inspection report of completed project.

b) Various office equipment and motor vehicles

transferred to several NIA Offices in the amount of ₱1.451 million and ₱15.629 million, respectively, were not supported with inventory reports and property acknowledgement receipts. Hence, custodial accountability over the equipment could not be established. (SPISP)

Issue AREs to the recipients of various office equipment and motor vehicles. In case these are in the custody of the officers in the Region, issue invoice receipt and record the transfer to the Regional Office.

c) Preliminary inspection and preparation of Final

Firmed Up Contract Quantity and Cost (FFUCQC) of six contracts amounting to ₱663.073 million reported as substantially completed in CYs 2015 and 2016 were delayed. Hence, veracity of the completion of the Contracts within the revised completion date is doubtful. Moreover, the final billings of Contract Nos. PIDP11-C-BRISN-1 and PIDP11-C-BRISN-3 were paid without the approved FFUCQC, and Final Inspection Report. The Contracts were reported to have

a. Submit reports on the

inspection conducted by the Inspectorate Team on the accomplishment of six completed Contracts, together with supporting documents and the approved final firmed up quantity and cost; and

b. Ensure that final billings are

supported with Final Inspection and FFUCQC.

50


been substantially completed as early as February 2015.

III. Reliability of PPE Account

A. Various Projects

1. The propriety and accuracy of a number of FS

accounts cannot be established due to, among others:

Project Accounts Particulars Amount in

Bill ₱

SPISP/ ARIIP/ BPIP

Construc-tion in Progress (CIP)/PPE

CIP included costs of completed projec s

11.060

SPISP Land and Land Improve-ment

No Subsidiary Ledger and cost of Land Improvement were not provided with depreciation.

17.482

SPISP CIP Abnormal/Negative balance due to errors in the recorded amounts

21.466

a. Expedite the transfer of the

completed projects from CIP account to proper PPE accounts and provide depreciation;

b. Prepare PPE Ledger card to support the Land and Land Improvement recorded in the books and provide depreciation;

c. Analyze negative/abnormal balances and make necessary adjustments.

51

4.1.3

As stipulated in the Philippine Development Plan (PDP) 2011-2016, Chapter 4, Competitive and Sustainable Agriculture and Fisheries Sector, the agriculture and fisheries sector provides food and vital raw materials for the rest of the economy. As the sector grows and modernizes, it releases surplus labor to the industry and services sectors. Rising productivity and efficiency in the sector are critical in maintaining the affordability of food and purchasing power, especially among the poor. The sector’s development is therefore vital in achieving inclusive growth and poverty reduction as well as attaining the targets under the Millennium Development Goals (MDGs).

MDGs are the world’s time-bound and quantified targets for addressing extreme poverty in its many dimensions-income, poverty, hunger, disease, lack of adequate shelter, and exclusion-while promoting gender equality, education, and environmental sustainability.

MANDATE

The Department is the government agency responsible for the promotion of agricultural development by providing the policy framework, public investments, and support services needed for domestic and export-oriented business enterprises.

In the fulfillment of this mandate, it shall be the primary concern of the Department to improve farm income and generate work opportunities for farmers, fishermen and other rural workers. It shall encourage people’s participation in agricultural development through sectoral representation in agricultural policy-making bodies so that the policies, plans and programs of the Department are formulated and executed to satisfy their needs.

It shall also use a bottom-up self-reliant farm system approach that will emphasize social justice, equity, productivity and sustainability in the use of agricultural resources.

VISION

The Department’s vision is a competitive, sustainable, and technology-based agriculture and fishery sector, driven by productive and progressive farmers and fisherfolk, supported by efficient value chains and well integrated in the domestic and international markets contributing to inclusive growth and poverty reduction.

MISSION

To help and empower the farming and fishing communities and the private sector to produce enough, accessible and affordable food for every Filipino and a decent income for all. Source: http://www.da.gov.ph/

52

The Department availed 22 loans under the Agriculture, Agrarian Reform and Natural

Resource (AARNR) sector with a total net loan commitments of ₱50.56 billion (US$1.02 billion)

to finance 19 projects of which three are ongoing during CY 2016. Table XXXII presents the

status of the 19 projects as well as the loan summary profile.

Table XXXII - Project Status and Loan Summary Profile (amount in million)

Audit of the two on-going projects resulted in a number of deficiencies.

Table XXXIII - List of On-going Projects with Audit Observations (Amounts in million)



I. Project Management

Project completion was affected by deficiencies in project construction, inadequate/inefficient monitoring, delayed submission of outputs by consultants or project approval or project implementation resulting in either reversion of fund to BTr and/or insufficiency of remaining funds to complete the project: a. The Rehabilitation of Masla-Duagan Farm to

Market Road incurred deficiencies amounting to ₱2.5 million due to massive scaling and enormous transverse-thru cracks as validated during inspection by COA Technical Staff. (SCHARMP)

Require the contractor to remove and replace the defects and to apply additional facial grout at its own expense as required under RA 9184 IRR 62.2.1 and 62.2.2.

b. Deficient or inadequate monitoring/

supervision of project implementation is evident in the following cases:

Project Observation

SCHARMP The Procurement Monitoring Report

Comply with Section 12.2 of the IRR of RA 9184 to properly monitor procurement activities and to give the public full access to the procurement process of the agency.


22 TOTAL 19 1,015.99 50,564.78 593.86 29,556.07 39.03 1,942.63 422.12 21,008.71

4 Ongoing 3 547.33 27,239.82 125.20 6,231.11 39.03 1,942.63 422.12 21,008.71

16 Completed 14 433.16 21,558.00 433.16 21,558.00 - - - -

2 Cancellled 2 35.50 1,766.95 35.50 1,766.95 - - - -


CountProject Status

Project

Count



TOTAL 532.96 26,524.93 111.67 5,557.88 39.03 1,942.63 421.29 20,967.06

8421-PH PRDP Ongoing 501.25 24,946.71 81.88 4,074.92 36.78 1,830.59 419.37 20,871.79

IFAD 749-PH CHARM2 Ongoing 21.71 1,080.53 19.80 985.27 2.25 112.03 1.91 95.27

OPEC 1224-P CHARM2 Ongoing 10.00 497.69 10.00 497.69 - - - -

Cumulative Availments CY Availments Undrawn BalanceLoan No.

Project

Name

Project

Status

CNLC

53


Project Observation

(PMR) required under Section 12.2 of the 2016 Implementing Rules and Regulations (IRR) of RA 9184 was not prepared; thus, the public was not afforded full access to information.

PRDP Out of the 363 total subprojects approved under I-Build Component with aggregate project cost of ₱17.982 billion, 122 subprojects costing ₱8.391 billion under implementation stage were not provided with target period of completion, hence it is difficult to assess whether the Project is efficiently implemented.

The Agency’s Quarterly Physical Report of Operation (QPRO) is not in accord with the standard format prescribed in the Government Accounting Manual (GAM), thereby defeating its very purpose of being a tool in monitoring the status of agency’s performance. (PSO Mindanao)

Provide for the completion date/period for the 122 SPs under implementation; henceforth, ensure that the period of completion for all SPs issued with no objection letter are provided.

Prepare the accomplishment reports in accordance with the prescribed standard set forth in the GAM where both the physical targets and the actual accomplishments are reflected to facilitate comparison, monitoring and evaluation on the progress of the implementation of the agency’s physical plans/targets (PAPs) and to timely detect any variance.

c. The remaining unprogrammed project cost of ₱555.232 million is no longer sufficient to attain the project development objective of the I-Build component and attain its target outputs/outcomes as provided in the PRDP Project Appraisal Document (PAD) in terms of (a) physical coverage; (b) projected number of PLGUs to be engaged. Likewise, the remaining fund is insufficient to cover the pipelined SPs pending approval costing ₱24.285 billion. (PRDP)

a. Explain the non-conformity to PAD in terms of expected physical coverage considering the depletion of fund vis-à-vis attainment of the PDO;

b. Resolve the insufficient funding requirement for the remaining 14 PLGUs that were not yet engaged or with proposal subject for approval/for issuance of NOL1 and non-conformity to the projected phasing of interventions as provided in the PAD; and

c. Ensure that any proposed additional financing/fund realignment to cover the pipelined SPs is in line with the PRDP results framework in order to attain the PDO in the implementation of PRDP.

d. Delayed project implementation is evident in the following cases:

Project Observation

PRDP The benefits to be derived from Value Chain Analysis (VCA) Studies and further implementation of programs and projects activities are put on hold due to delayed submission of deliverables as stipulated in

Require the consultant to submit justifications on the delays incurred; and take appropriate action thereon. For future undertakings, conduct thorough review of contracts and closely monitor submission of deliverables to protect the interest of the government.

54


Project Observation

Section 41.2 of the Special Conditions of Contract. (PSO Mindanao)

Cash allocation of ₱427.059 million or 45 percent of the total allotments of ₱941.100 million received as of December 31, 2016, was not utilized resulting in its reversion to the BTr, and in the delay/non-implementation of various foreign-assisted projects. (NPCO and PSO Luzon B)

Out of the 10 FMR project proposals submitted to PSO for review and approval, only one project was approved and 3.08 percent accomplished to date hence, the objective on the accessibility to and from the market was not attained. (RPCO I)

Formulate a realistic and attainable work plan and budget to ensure that the MDP matched the budgetary and disbursement requirements of the DA and install budget performance tracking system to monitor the utilization of allotments in order to prevent the lapsing of cash allocations;

Require PLGU/MLGU beneficiaries to be prompt in complying with all documents required by DA RFO I and PSO for immediate processing/ approving of proposal for indorsement for implementation;

II. Financial Management

1. Management of financial transactions is weak

resulting in payment either without legal basis or in advance, or of insufficiently documented transactions, or of excessive meals and foods, or of transactions not in conformance with existing regulations: a. Payment without legal basis or in excess

of the requirements:

Project Amount (in M. ₱)

Remarks

SCHARMP/ PRDP

4.069 Honoraria paid on December 13, 2016 without final computation; hence, basis for payment is not clear.

PRDP 1.501 Payment of cell cards to PRDP staffs and officers has no proper authority, hence not allowed in audit. (PSO Mindanao)

22.548

Payment of productivity incentive to consultants/ COS/project-hired and DA personnel in CYs 2016 and 2015, has no legal basis and not in accordance with existing rules. Likewise, the National Projects Advisory

Comply with documentary requirements prescribed under DBM Circular No. 2007-2, to establish propriety and validity of disbursements;

Provide/submit legal authority on the grant of cell card allocation to its staff and officer, otherwise, require refund of the equivalent amount by each PRDP staff and employees concerned.

Stop the practice of paying incentive allowance to consultants/COS and DA employees assigned to the PRDP; and require the concerned personnel to refund the amount of the productivity incentive allowance received.

55



Remarks

Board (NPAB) has no authority to grant any incentive due to the PRDP consultant/COS. (NPCO, PSOs Luzon B, Visayas Mindanao and RPCOs CAR, I, IV-A, IV-B, VI, VII, VIII, IX, XII and XIII)

2.975 Payment of honoraria to DA Officers and Employees assigned in PRDP RPCO II from January 2015 to July 2016 contrary to COA Circular no 2012-003 dated October 29, 2012 in relation to DBM Budget Circular No. 2007-2 dated October 1, 2007. (RPCO II)

0.595 Excessive payment of food, meals and hotel accommodations, due to lack of proper planning/ programming of conferences, trainings/ seminars and meetings. (PSO Luzon A)

Comply strictly to COA Circular no 2012-003 dated October 29, 2012 in relation to DBM Budget Circular No. 2007-2 dated October 1, 2007 and settle immediately the issued Notice of Disallowance.

a. Initiate judicious use of funds for conferences, trainings/seminars and meetings by establishing a reasonable limit; and

b. Require officials concerned to submit justification/clarification on over estimation and non-attendance of expected participants and guests;

b. Payments not in accordance with existing

rules and regulations:


Remarks

PRDP 0.235 Utilization of Petty Cash Fund for payment of regular expenses; excessive recurring expenses; and insufficiently documented transactions. The Accountable Officer was also found to have insufficient fidelity bond; (NPCO and PSO Luzon B)

a. Re-evaluate the necessity of handing PCF and direct the immediate reduction of PCF, as necessary;

b. Require immediate payment of additional fidelity bond premium corresponding to the total cash advances of the AO; and

c. Ensure that the AO is oriented on the guidelines on handling and disposition of PCF and the appropriate documentary requirements for liquidating CA.

56


4.692 Disbursements were not properly supported by complete documentation required under existing laws, rules and


Remarks

regulations, thus, validity, regularity and propriety could not be determined. (RPCOs IV-A and V)

6.659 DA-detailed staff were paid honoraria on a fixed monthly rate and without proof of acceptance by the agency head of their deliverables under their control. (RPCOs III, V and VI and PSO Luzon A)

3.150 Officials and employees of DA-RFU IV-B designated on part-time basis to PRDP RPCO IV-B were paid honoraria even without documentary requirements, and without withholding tax, thus, rendering the authenticity of the transactions doubtful. (RPCO IV-B)

Ensure that all claims are duly approved and properly documented.

Revisit the provisions in the granting of honorarium; formulate performance evaluation plan to ensure that honorarium is extended only to qualified personnel; submit certificate of acceptance by the Project Director of deliverables per project component; and performance ratings of personnel for the first and second semesters of CY 2016.

Submit Performance Evaluation Plan formulated by project management used as a basis for rating the performance of the members, and the Terms of Reference.

2. Financial records and reports were not

submitted to the audit team on time, hence, the validity and propriety of transactions were not ascertained on time: Project Remarks

PRDP Monthly BRS was not submitted regularly resulting in non-detection of errors for immediate adjustments in the books. (RPCOs I, III, IV-A and PSO Luzon A)

DVs with supporting documents were not submitted to the audit team; hence, the validity, appropriateness, and propriety of the financial records were not ascertained on time. (RPCO CAR and IV-A)

Trial balance, financial statements and reports were not submitted on time resulting in delayed audit of accounts. (RPCOs III, IV-A and XII and PSO Luzon A)

Regularly prepare and submit monthly Bank Reconciliation Statements of all bank accounts to the Team for immediate verification and analysis, and recording of adjustments, if any.

Submit DVs to the COA Audit Team on time and direct the concerned officials to implement Section 122 of P.D. 1445 on the withholding of payment of salaries of the concerned/erring personnel.

Install reporting linkages between the Accounting and Disbursing Units to ensure that the required monthly financial and accounting reports are submitted to COA within the prescribed time.

57


Project Remarks

The consultancy contracts and required supporting documents for the services of PRDP consultants and researchers were not submitted for review within five (5) working days from contract execution, contrary to Sec. 3.1.1 of COA Circular No. 2009-001. (RPCO V)

Submit copies of Contracts of Service and their complete supporting documents within five (5) working days from execution of such contracts as required under COA Circular 2009-001; and Section 4 (6) of PD No. 1445, Section 36 of GAM for NGAS Volume I, and COA Circular No. 2012-001.

3. Property and Equipment of were not insured

with the Government Service Insurance System (GSIS) against damage or loss through theft, fire and other fortuitous events.

Project Property Amount (in M. ₱)

SCHARMP Equipment 22.213

PRDP PPE Accounts 11.383

Total 33.596

Project Management should see to it that all equipment are insured to provide adequate protection in case of calamities and any untoward incidents.

4. Interest income amounting to ₱0.545 million

earned from deposits in the AGDB accounts remained unremitted to BTr. (NPCO and PSO Luzon B-PRDP)

Immediately remit the amount of ₱0.545 million to BTr and henceforth, ensure that interest income recognized in the books are regularly remitted to the BTr;

5. The standard fund flow prescribed in the

PRDP Financial Management Operations Guidelines Manual was not strictly observed by PRDP-NPCO and PRDP-PSO Mindanao Cluster due to purported conflict with the provisions of UACS, defeating the purpose of applying accounting controls to safeguard assets, particularly the funds entrusted to them for which guidelines were created for. (PSO Mindanao-PRDP)

a. Coordinate with the Department of

Budget and Management (DBM) to resolve the issue on purported conflict on the provision on funds flow between UACS and Loan Agreement which hinders the agency’s compliance with the standard funds flow for PRDP-PSO (GOP and LP Counterparts);

b. Discontinue the practice of joggling

funds from GOP-LBP Trust Account to LP-LBP Trust Account to temporarily meet expenditures of the latter. Moreover, revisit the process of requesting for fund either for GOP or LP counterparts to make necessary revision/s to improve such in order to properly manage entrusted funds.

III. Reliability of Financial Statements

The balances of a number of accounts cannot be relied upon due to, among others:

Project Account Amount (in M. ₱)

Remarks

Reclassify long outstanding fund transfers

58


SCHARMP Due from NGAs

0.999 Long outstanding fund transfers to other NGAs were recognized as current r ceivables instead of non-current receivables.

Accounts Payable

1.401 No available disbursement vouchers to support validity and existence.

PRDP Liability account

0.170 SL balances which remained outstanding for more than two years. (NCPO, PSO Luzon B)

1.420 Included accounts with incomplete documents or supporting documents. (RPCO V)

211.932 Unliquidated fund transfers to RPCOs IX, X, XI, XII, XIII and ARMM as of December 31, 2016 or 98% of the total transfers from CY 2014 to 2016. (PSO Mindanao)

Inventory accounts

1.079 Office supplies and materials directly recorded as Expense. (RPCO V)

1.553 Overstated due to non-preparation of RSMI (NCPO, PSO Luzon B)

0.053 Understated due to late recording of deliveries (NCPO, PSO Luzon B)

Project Account Amount (in M. ₱)

Remarks

Petty 0.111 Overstated due to

to non-current receivables, and advice IAs to return the unutilized fund to fast track liquidation of fund transferred.

Reclassify the current liabilities not payable within one year to the non-current portion of the liabilities and cancel obligations that are not valid.

Review and analyze the long outstanding payables to determine its proper disposition and, if warranted, revert, outstanding payables aged more than two years.

See to it that Accounts Payable is

supported with complete documentation.

a. Comply with the guidelines on fund transfers and the stipulations of the Program Contract, to ensure timely liquidation and proper subsequent releases;

b. Regularly monitor and update status of

trust funds to avoid its accumulation thus, prevent the improper and unauthorized utilization of the unexpended amount.

Comply with the provisions of the Government Accounting Manual Volume I with regards to proper accounting for inventories.

Prepare and submit the RSMI to the Accounting Division for inventory items issued as basis for adjustment.

Oblige the Supply/Property Unit to submit to the Accounting Office all necessary documents of all accepted deliveries at the time the transaction occurred, regardless of payment.

Effect necessary adjustments to correct

59


Cash Fund

errors and omissions (NCPO, PSO Luzon B)

Cash in bank

27.952 Understated due to errors and omissions (NCPO, PSO Luzon B)

Expendi-ture accountsSREs

0.131 Overstated due to errors in amounts of honoraria and consultancy services and inclusion of replacement checks. (RCPO VI)

PPE - Motor vehicles

2.575 Received from PRDP National Project Coordinating Office which remained unrecorded. (RCPO VI)

PPE-ICT Equip-ment

0.796 No Report on Physical Count of Property Plant and Equipment (RCPPE) as of December 31, 2016. (RPCO V)

PPE account

15.577 Erroneous recognition and derecognition of PPEs (NCPO, PSO Luzon B)

Allowance for depre-ciation

2.162 Erroneous/non-provi-sion of allowance for depreciation (NCPO, PSO Luzon B)

reported balances of the affected accounts in the Financial Statements;

Make necessary adjustments in the Statement of Receipts and Expenditures (SREs) as well as in the Statement of Sources and Application of Funds (SSAF) and see to it that expenditures are properly classified to the proper sub-components of the Project based on the Budget Utilization Request and Status.

Record the vehicles in the books of PRDP-RPCO 6 and provide the corresponding accumulated depreciation thereof.

a. Conduct regular physical count and prepare and submit the properly accomplished RPCI and RPCPPE to COA on prescribed dates;

b. Maintain SC and PC for each item of

Inventory and PPE accounts, respectively; and

c. Make the necessary adjusting entries to

adjust erroneous recognition and derecognition as well as non-provision of allowance for depreciation.

60

4.1.4

MANDATE

The Department is the primary agency responsible for the conservation, management,

development, and proper use of the country’s environment and natural resources, specifically

forest and grazing lands, mineral resources, including those in reservation and watershed

areas, and lands of the public domain, as well as the licensing and regulation of all natural

resources as may be provided for by law in order to ensure equitable sharing of the benefits

derived therefrom for the welfare of the present and future generations of Filipinos.

To accomplish this mandate, the Department shall be guided by the following objectives:

1. Assure the availability and sustainability of the country's natural resources through judicious

use and systematic restoration or replacement, whenever possible;

2. Increase the productivity of natural resources in order to meet the demands for forest,

mineral, and land resources of a growing population;

3. Enhance the contribution of natural resources for achieving national economic and social

development;

4. Promote equitable access to natural resources by the different sectors of the population; and

5. Conserve specific terrestrial and marine areas representative of the Philippine natural and

cultural heritage for present and future generations.

VISION

A nation enjoying and sustaining its natural resources and clean and healthy environment.

MISSION

To mobilize our citizenry in protecting, conserving, and managing the environment and natural

resources for the present and future generations.

DEVELOPMENT GOAL

Human well-being, and environmental quality and sustainability ensured.

61

The DENR has availed of 13 loans as of December 31, 2016 to implement 12 projects,

two of which are still on-going. Table XXXIV below show

Table XXXIV - Project Status and Loan Summary Profile (amount in million)

In the audit of two on-going projects and one completed project, a number of

deficiencies were noted:

Table XXXV - List of Projects with Audit Observations (Amounts in million)



I. Project Management

The timely completion of projects and maintenance of completed areas may be adversely affected by low loan availment and failure of NGOs to comply with SEC requirements and to strictly follow the Work and Financial Plan.

a. A total of ₱14.894 million representing 12.92 percent of the total project cost was not availed of by beneficiary LGUs of RO VI as of December 31, 2016 resulting in low fund utilization. (CBFMMP)

b. The Site Development Contract Work and

Financial Plan with the People’s Organizations was not strictly observed resulting in delayed implementation of some activities as well as low utilization of funds which may result in the non-attainment of the project’s objectives. (FMP)

a. Adhere to the terms and

conditions of the Agreement and adopt measures to address the problems on low availment;

b. Adopt measures or catch up plan to address delayed implementation of activities, and

c. Conduct periodic monitoring,

evaluation and reporting of funds utilization to ensure expected outputs are accomplished on time.


13 TOTAL 12 389.25 19,372.38 209.24 10,413.75 8.31 413.41 180.00 8,958.63

3 Ongoing 2 196.43 9,776.25 16.91 841.36 8.53 424.48 179.53 8,934.89

9 Completed 9 192.81 9,596.13 192.34 9,572.39 (0.22) (11.07) 0.48 23.74

1 Cancellled 1 - - - - - - - -


CountProject Status

Project

Count



TOTAL 200.62 9,984.59 21.09 1,049.70 8.53 424.48 179.53 8,934.89

KFW-02 CBFMMP Completed 4.19 208.33 4.19 208.33 - - - -

2957-PHI INREMP Ongoing 100.00 4,976.90 8.18 407.17 5.04 250.75 91.82 4,569.73

I-890-PH 17.81 886.50 1.81 89.99 1.27 63.12 16.00 796.52

JBIC PH-P248 FMP Ongoing 78.62 3,912.85 6.92 344.21 2.22 110.60 71.70 3,568.64

Cumulative

Availments

CY Availments Undrawn BalanceLoan No.

Project

Name

Project

Status

CNLC

62


c. Some People’s Organization failed to submit

for several years to the Securities and Exchange Commission (SEC), the required Reportorial and Monitoring Requirements. This may pose the risk of revocation or suspension of their certificates of registration which may affect the implementation of remaining reforestation activities. (FMP)

The FMP Coordinator and Site Management Officers in each Sub-project Site Management Office (SUSIMO), to properly and continuously monitor compliance by POs with the reportorial requirements of SEC, to ensure their continuous existence and eligibility to undertake FMP activities.

II. Financial Management

Management of financial transactions is weak resulting in delayed or failure to submit reports, and in payments of transaction without legal basis or without deducting liquidated damages, or despite incomplete documentary requirements:

Project Particulars Amount

(In M. ₱)

FMP Some officials and employees were paid honoraria without legal basis. (FMP-RO VI

0.299

INREMP Payment of honoraria not supported with complete and proper documents (INREMP-PENRO Kalinga)

FMP/ INREMP

Documentary requirements, disbursement vouchers and its supporting documents, and/or financial reports and other related accounting reports were not submitted within the prescribed period in violation of pertinent laws, rules and regulations. Thus, validity, regularity, completeness and accuracy of recorded transactions could not be ascertained. (INREMP PENRO Apayao and FMP – RO VI)

INREMP Despite delay on delivery of goods, liquidated damages were not imposed and deducted from payments to suppliers. (INREMP-FMB)

0.923

Submit authority to claim honoraria for FMP projects and the documents required by DBM Budget Circular No. 2007-002 dated October 1, 2007, otherwise, refund the amount received.

Submit the INREMP/Fund 102 financial reports, disbursement vouchers and its supporting documents to the Auditor within the prescribed period to facilitate review, analysis and audit of the same.

a. Ensure that all contracts entered

into contain a provision on liquidated damages, as required under RA 9184, to protect the interest of the Forest Management Bureau; and

b. Impose liquidated damages on late deliveries of goods and services.

63


III. Procurement Management

The existing rules and regulations on procurement of goods and consultancy contracts were not strictly adhered:


(In M. ₱)

INREMP Delivery of one (1) unit HP Designjet SD Pro MFP 44” plotter was accepted despite non-conformity with the prescribed specification of the equipment, to the disadvantage of the agency and contrary to the provision of Presidential Decree No. 1445 on complete documentation of transactions. (INREMP-FMB)

0.885

Private motor vehicles were hired for field activities even if there are available ordinary public conveyances (INREMP-PENRO-Kalinga)

Hiring of three Assisting Professionals was not in accordance with Chapter IV of DENR Administrative Order No. 2000-65, thus transparency and wide selection of applicants were not ensured. (FMP-PENRO Ifugao and Mt Province)

a. Submit Inspection and Acceptance Report indicating the actual specification of the item actually delivered for evaluation;

b. Submit explanation why time

extension was approved by persons other than the Head of the Procuring Entity; and

c. Ensure that procurement of goods

and services are in accordance with existing laws, rules and regulations.

a. Discontinue hiring of private vans if there are available public conveyances except if warranted by prevailing circumstances or situations; and

b. Require employees to plan and arrange travels to avail the most cost-effective way of engaging the services of hired vehicles.

Follow provisions in hiring Assisting Professionals as provided under Section 17, Chapter IV of DENR Administrative Order No. 2000-65 and submit written justification on the non-consideration of the procedure in the procurement process for evaluation.

IV. Reliability of Financial Statement

The balances of various accounts cannot be relied upon due to, among others:

Account Amount (In M ₱)

Remarks

LI - Refo-restation Projects & CIP – LI

8.727

Payments to POs during the year was erroneously recorded as Land Improvements (LI) - Reforestation Projects (RP) instead of CIP – LI (FMP-RO VI)

Account Amount Remarks

a. Make necessary adjustments in the

FMP books to reflect the correct balance of the CIP – LI account; and

b. Examine the details of the account “LI-RP” pertaining to prior years and make necessary adjustments, if warranted.

64

Audit Observations Recommendations (In M ₱)

PPE/CIP 21.89 Unreconciled balances of PPE accounts per books and per RPCPPE and non-maintenance of property cards and PPE ledger cards. (FMP – RO VI)

1.191 Completed projects recorded under the CIP - Buildings and Other Structures account were not reclassified to the Buildings account; while refund made by the contractor due to over payment was erroneously recorded to CIP-Building and Other Structures account. (FMP – RO VI)

0.602 Semi-expendable equipment recorded as PPE (INREMP-CAR Regional Office)

0.738 Semi-expendable equipment recorded as PPE (FMP-PENRO Ifugao and Mountain Province)

CIB - LCCA 0.005 Cancelled/stale check reflected in the BRS on LBP CA No. 3302-1027-90 (MDS 102-LP) was not adjusted in the agency books resulting in the understatement of the said account as of December 31, 2016. (FMP-RO VI)

2.277 Non-submission of BRS for a bank account for INREMP-GEF under Fund 171 and discrepancies between bank and book balances. (INREMP-FMB)

0.011 Discrepancy between bank and book balance (FMP-FMB)

Fuel, Oil and lubricant expenses

0.147 Non-submission of Monthly Report of Official Travels (MROT) and Monthly Reports of Fuel Consumption (MRFC). (FMP – RO VI)

Advances to Contractors

15.304 Non-maintenance of subsidiary ledger, precluding reconciliation of the GL and SL. (FMP – RO VI)

Account Amount Remarks

a. Reconcile the difference between the accounting and property records;

b. Require the Supply Officer/ Property Custodian to maintain/update the Property Cards and conduct physical count/inventory of property; and

c. Require the Accountant to

maintain PPE ledger cards for reconciliation purposes.

d. Make necessary adjustments to reflect correct balances of affected accounts; and

e. Henceforth, record the issued

semi-expendable equipment as expense.

a. Examine the nature of the cancelled/stale check reflected in the BRS, reconcile the book and bank balances and cause the immediate adjustment in the agency books, if warranted; and

b. Immediately prepare the BRS for CY 2016 and submit to the audit team for evaluation.

a. Submit MROT with the corresponding MRFC monthly to support expenses; and

b. Immediately impose the use of properly accomplished Driver’s Trip Ticket pursuant to existing rules and regulations.

Maintain necessary SL for the account, Advances to Contractors, to facilitate reconciliation of the GL and SL and in providing detailed information needed by fiscal or control agencies of the government.

65

Audit Observations Recommendations (In M ₱)

Advances for Operating Expenses

0.394 Cash Advances for wages of contractual personnel were erroneously recorded as Advances for Operating Expenses instead of Advances for Payroll account (FMP – RO VI)

Make necessary adjustments in the agency books to reflect the correct balance of Advances for Payroll account.

66

4.1.5

The Department of Agrarian Reform (DAR) leads the implementation of the Comprehensive

Agrarian Reform Program (CARP) and sustainable rural development in the countryside

through land tenure improvement, provision of integrated development services to landless

farmers, farmworkers and small landowner-cultivators, delivery of agrarian justice and

coordinating delivery of essential support services to client-beneficiaries.

The following are its specific functions:

To provide Land Tenure security to landless farmers through land acquisition and

distribution; leasehold arrangements' implementation and other LTI services;

To provide legal intervention to Agrarian Reform Beneficiaries (ARBs) through adjudication

of agrarian cases and agrarian legal assistance;

To implement, facilitate and coordinate the delivery of support services to ARBs through

Social Infrastructure and Local Capability Building (SILCAB); Sustainable Agribusiness and

Rural Enterprise Development (SARED); and Access Facilitation and Enhancement Services

(AFAES).

Source: http://dar7.net.ph/ & http://www.dar.gov.ph/

http://www.dar.gov.ph/

http://www.dar.gov.ph/

http://www.dar.gov.ph/transparencyseal

http://dar7.net.ph/

67

As the lead implementing agency of CARP, DAR availed 24 ODA loans under the

Infrastructure Sector, and the Agriculture, Agrarian Reform and Natural Resource (AARNR)

Sector with total net loan commitments of P22.92 billion (US$1.12 billion) to finance 22 projects;

six of which are still on-going as of December 31, 2016. The status of the 22 projects and the

loan summary profile are presented in Table XXXVI.

Table XXXVI - Project Status and Loan Summary Profile (amount in million)

In the audit of four on-going projects, a number of deficiencies were noted:

Table XXXVII - List of Projects with Audit Observations (Amounts in million)



1. Compliance with Existing Rules and Regulations

Existing rules and regulations governing financial transactions were not strictly observed. DAR continued to maintain the General Control Fund (GCF) for ARCP II project with a balance of ₱84.751 million under the following conditions:

a. absence of authority to maintain the same from the Permanent Committee contrary to the Joint COA and DBM Circular No. 4-2012 dated September 11, 2012;

b. the bank balance was not recorded in the books,

thus, the risk of misappropriation/irregular disbursement is highly probable;

c. expenses were charged even if funds transferred

were for prior years and without the corresponding legislative enactment for the use thereof;

Revert the balance of the GCF Trust account to the National Treasury and explain the apparent double payments made.


24 TOTAL 22 1,123.51 55,915.98 891.27 44,357.38 16.50 821.42 232.24 11,558.59

8 Ongoing 6 626.54 31,182.48 395.33 19,675.37 16.50 821.42 231.21 11,507.11

16 Completed 16 496.97 24,733.50 495.93 24,682.01 - - 1.03 51.48


CountProject Status

Project

Count



TOTAL 175.97 8,758.03 61.27 3,049.13 10.32 513.57 114.71 5,708.90

ADB2465 PHI ARCP-II Ongoing 67.00 3,334.52 30.98 1,541.91 5.15 256.14 36.02 1,792.61

JBIC PH-P251 MINSAAD Ongoing 51.57 2,566.38 18.57 924.10 2.58 128.50 33.00 1,642.28

MMCC

EUR26.19M

IARCDSP Ongoing 27.41 1,364.06 6.90 343.43 - - 20.51 1,020.63

OPEC 1225-P ARCP-II Ongoing 30.00 1,493.07 4.82 239.69 2.59 128.93 25.18 1,253.38

Cumulative

Availments

CY Availments Undrawn BalanceLoan No. Project Name

Project

Status

CNLC

68


d. expenses were not properly documented and

recorded; and

e. absence of BRS for the account, thus, correctness of other charges cannot be verified.

2. Reliability of Financial Statement Balances

FS balances in three projects for the following accounts cannot be relied upon due to:

Project Account Amount

(In M ₱) Remarks

IARCDSP PPE 0.035 Lost ACER Travelmate laptop computer recorded under PPE account.

MINSAAD Accumulated Surplus/ Depreciation expense

0.009 While there were no Furniture and Fixture accounts in the books, there were depreciation expenses recorded.

PPE 0.053 Non-inclusion of the tax portion of the equipment and non-provision of allowance for depreciation at the end of the year.

Due to BIR 0.369 Uncorrected errors and unremitted taxes withheld from prior years’ transactions.

Consultancy Services account/ Accumulated Surplus

50.304 Consultancy services erroneously debited to Accumulated Surplus account instead of recording the transaction as current year expenses.

ARCP II 33.324

a. Demand payment from the AO

for the acquisition cost of the lost

equipment or withhold payment of salary until the full cost is recovered;

b. The Accountant to set up a receivable account for the accountability of the accountable officer; and to adjust the booked depreciation of the lost equipment.

Close the Depreciation Expense – Furniture and Fixtures account to Accumulated Surplus as of year-end or adjust the affected accounts.

Record the tax portion of ₱53,035.71 as part of the cost of the ICTE 2 and provide Allowance for Accumulated Depreciation from June to December 2016.

Remit all unremitted withheld taxes to BIR; review and analyze the entries in the General Ledger and prepare the necessary adjustments.

Prepare appropriate adjustments in the books and adhere to applicable regulations in the proper recording of transactions to come up with fairly presented financial statements.

69


3. Project Implementation

The completion of four projects were delayed with reported slippages of 6.04 percent to 42.04 percent and around ₱78.920 million to ₱598.203 million unutilized funds reverted to the Bureau of the Treasury:

Projects Remarks % of

Slippages

Amount reverted to

BTr (In M ₱)

IARCDSP While project duration was revised, the targets and budgetary requirements were not revised. Thus, project implementation incurred delays with unutilized GOP releases for two years reverted to the National Treasury.

42.04 32.388

ARCP II Project accomplishments after 94th month of implementation, with total disbursements of ₱5.997 million equivalent to 90.03 percent of the total funds, was reported to be 71.24 percent complete. The unutilized balance was reverted to the BTr. The project was scheduled to be completed within 70 months.

28.76 598.203

MInSAAD Implementation delayed as of CY 2016, with unused funds reverted to BTr.

45.45 78.920

ARISP III Costs incurred in some infrastructure components exceeded project costs by ₱462.106 million which is more than the budget for unforeseen situations by ₱123.354 million. Projects were completed on its 10th year which is 125 percent of its project life, with slippage.

6.04 0

a. Prepare a revised project work and

financial plan in accordance with the revised project duration and ensure adequate planning before execution of any project.

b. Exert extra effort to strengthen project

monitoring to enable completion of projects within the project duration or the given final extension period;

c. Require DARPO Negros Occidental to

promptly comply with the financial and technical requirements of MDFO for fund releases;

d. Request LGUs to make available

counterpart funds to ensure that targeted dates of completion are met;

e. Identify constraints on the

implementation of the project and formulate strategies to ensure completion before the loan; and

f. For activities that exceeded their

budget, explain the deviation.

70

4.1.6

The DOTr logo, an eagle within a circular background part of which is a five-cogged wheel, represents three things: transportation, communications, and the ultimate goal of the Department. The eagle, our national bird, is large and striking, graceful in flight, and free the embodiment of what the country wants its transportation and communications to be, big enough in scale and scope to transport the largest possible number of people in comfort and ease to any point in the archipelago; the heights the eagle can reach represent the optimum position for communications the greater the height, the more areas and people it can serve.

The circular emblem symbolizes unity of purpose and an unbroken chain of service and dedication. It alludes to the wheel and movement, signifying progress. An eagle, symbolic of air and sky, and soaring high and fast over sea and land within a circular backdrop of blue (depth and stability), represents an undying commitment to provide viable, efficient, and dependable transportation and communications systems as effective instruments for a unified nation. A nation, unified, can soar to whatever heights it aims for.

http://dotr.gov.ph/

71

The Department availed 41 ODA loans under the Infrastructure Sector with total net loan

commitments of ₱220.58 billion (US$4.43 billion) to finance 34 projects; eight of which are still on-

going as of December 31, 2016. The status of the 34 projects and the loan summary profile are

presented in Table XXXVIII.

Table XXXVIII - Project Status and Loan Summary Profile (amount in million)

In the audit of five on-going and three completed projects, a number of deficiencies were

noted:

Table XXXIX - List of Projects with Audit Observations (Amounts in million)



1. Fund Utilization Status

DOTr registered a low utilization rate of only 36.86 percent of its total allotment of ₱14.914 billion in 2016. This resulted in the reversion of ₱3.847 billion allotment and lapsing of ₱2.127 billion cash allocation. The projects with zero or low loan utilization follow:

Project

Appropriation – In Million ₱ % of Utiliza-

tion Current Continuing

Utiliza-tion

Cebu BRT 1,336.20 0 0 0

0 233.255 25.017 10.73

LRT Line 1 Ext. 1,003.58 536.70 0 0

LRT Line 2 Ext. 1,534.00 406.64 0 0

PPCGCDP 0 1,943.626 0 0

PPIADP 0 135.127 35.999 26.64

a. Maximize the utilization of the

approved budget by ensuring prompt implementation of the planned programs, projects and activities; and

b. Improve the preparation of the Monthly Disbursement Program to come up with a more realistic forecast of the agency’s cash requirements to avoid the lapse and reversion of cash allocations.


41 TOTAL 34 4,432.13 220,582.59 1,225.95 61,014.37 71.32 3,549.53 3,206.18 159,568.21

12 Ongoing 8 1,369.13 68,140.41 367.30 18,280.00 71.32 3,549.53 1,001.84 49,860.41

26 Completed 23 864.91 43,045.77 858.65 42,734.37 - - 6.26 311.40

2 NYI 2 2,198.08 109,396.40 - - - - 2,198.08 109,396.40

1 Cancellled 1 - - - - - - - -


CountProject Status

Project

Count



TOTAL 840.52 41,831.94 289.47 14,406.64 44.09 2,194.37 551.05 27,425.30

JBIC PH-P173 SRRDP Completed 36.46 1,814.36 36.46 1,814.36 - - - -

JBIC PH-P208 MSIP-III 2.14 106.38 2.14 106.38 - - - -

PHL-13 LAAN 11.90 592.37 8.96 445.74 - - 2.95 146.64

PHL-11 PPADP Ongoing 64.08 3,189.41 43.51 2,165.32 19.07 949.23 20.58 1,024.09

PHL-5A 18.85 938.35 18.85 938.35 - - - -

PHL-5B 60.00 2,986.26 60.00 2,986.26 - - - -

JBIC PH-P228 CNS/ATM 187.53 9,333.02 91.64 4,561.05 19.06 948.69 95.88 4,771.97

PH-P255 CEMTSMMP 367.86 18,307.94 8.69 432.34 3.89 193.40 359.17 17,875.60

PH-P256 NBAC-SEPP 91.70 4,563.86 19.23 956.86 2.07 103.05 72.47 3,607.00

Cumulative Availments CY Availments Undrawn Balance

PADP

Loan No. Project NameProject

Status

CNLC

72


2. Delayed Project Implementation

Implementation of the following projects was delayed despite availability of loan facilities due to slow procurement process and Right-of-Way (ROW) problems resulting not only in depriving the public of the immediate use of the project but also in increased commitment fees and posing further financial problems to the government in case availment from loans will reach the closing period without completing the projects. From CYs 2013 to 2016, total commitment fees paid for following three projects amounted to ₱77.856 million.

Project Commitment

Fees (In Mill ₱)

Project

CEMTSMMP

56.700 Delayed implementation due to prolonged procurement activities; and low mobilization of consultants which resulted in the accumulation of commitment fees from CYs 2013 to 2016.

NBAC-SEPP

13.090 Delayed due to slow procurement process and right of way problem. Expenditures after the loan closing date which will not be financed under the loan, have to be sourced from the GOP funds, posing further financial problems to the government.

CBRT

8.065 Delayed due to slow procurement process of consultancy services or on account of differences in opinion between the funding agency, and the BAC of the implementing agency.

Total 77.856

a. Resolve immediately the issues

on bidding, ROW, and procurement of consultants and other similar issues, to accelerate the implementation of the project; and

b. Revise the Detailed Time Schedule and prepare a catch-up/work plan to attain the target completion dates indicated in the contracts;


1. Audit disallowances of ₱823,857.01 that had become

final and executory remained unsettled as of 31 December 2016 contrary to Sections 7.1.1, 22.1 and 23.1 of the 2009 Rules and Regulations on the Settlement of Accounts. (SRRDP)

Require immediate settlement by the persons liable under COE No. 2015-183 dated 24 August 2015 and ND No. 2000-001-102(99) of the total disallowances of ₱823,857.01.

2. Properties transferred to other government agencies

amounting to ₱2.27 billion were dropped from the DOTr books without the duly acknowledged Invoice Receipt of Property (IRP) required under DOTC Department Order No. 2005-31 dated August 10, 2005.

Follow up from the recipient agencies/end users the duly acknowledged IRPs to support the dropping of PPEs from the books.

73



The FS balances of the following accounts cannot be relied upon due to:

Project Account

Amount Over/Under (In Mil. ₱)

Remarks

MSIP DFP GSFPP

PPE -Seaport System

235.151 Turned over/transferred completed projects to the end users such as MARINA, Philippine Coast Guard and Philippine Fisheries Development Authority remained in the books of DOTr.

CNS/ ATM

Advan-ces to Contrac-tors

1,039.883 Unrecouped advances to Sumitomo Corp./Thales for the two components of CNS/ATM project with advances outstanding since CYs 2011 and 2013. These provide, with completion target of July 21, 2016 and December 12, 2016, were reported in the Consolidated Project Implementation Status Report as of December 31, 2016 to be 89.20 percent and 95.30 percent complete.

a. Issue IRP to MARINA, PCG

and PFDA for the completed and transferred/turned-over seaport systems projects;

b. Ensure the accurate costing of the individual projects;

c. Draw separate JEVs dropping

from the books of DOTr, the acquisition cost and accumulated depreciation of transferred projects/PPEs, once the signed IRPs are received from the Chief, PUDD and furnish these JEVs to the respective Chief Accountants of the transferee-agencies; and

d. Require the transferee-

agencies to book up the value of the transferred projects/PPEs.

a. Submit an explanation for the non-recoupment of long outstanding balance of advances to Sumitomo Corp./Thales despite payments made for the 89.20 percent and 95.30 percent of project completion; and

b. Make sure that the full amount

of advances to contractors is recouped/repaid before the final payment for the project completion in accordance with RIRR RA 9184.

74

4.1.7

Mission

1. Serve as mobilizer and administrator of funds for local development; 2. Provide technical assistance services; 3. Promote responsible financial management by MDFO and LGUs; 4. Develop and maintain partnerships, including from the private sector, in project financing; 5. Engage in financial policy formulation and implementation.

Vision

Leading financial service institution to advance development of LGUs towards sustainable progress and prosperity using good governance

Mandate

1. As a source of credit finance in support of the decentralization of services from the national to the local levels of government;

2. Promote the acceptability of borrowing as a means of financing a wide range of local government investments;

3. Promote and assist local governments in the selection of well-justified and high-quality investments in infrastructure projects and public facilities;

4. Encourage a cost-recovery approach to the provision of suitable public services through the levy of appropriate levels of fees and users' charges.

In addition, the MDFO shall:

5. Perform loan and credit operations within the context of a financially-viable and stable credit institution; 6. Provide credit finance and/or grants to LGUs for the development of sustainable socio-economic

development projects; 7. Provide technical assistance to LGUs to enhance their capacity to conduct project identification and

selection, loan proposal preparation, and project management and monitoring; 8. Issue bond indebtedness and other forms of securities to help finance LGU projects; and

75

9. Develop a system for monitoring LGU creditworthiness and graduating creditworthy LGUs to private sources of capital.

76

Seven projects funded by nine loans with total net loan commitments of ₱24.95 billion

(US$0.50 billion) were channeled to MDFO and implemented by DAR, DepEd, DENR, DOF and

DOH; two of which are still on-going as of December 31, 2016. The status of the seven projects

and the loan summary profile are presented in Table XL.

Table XL - Project Status and Loan Summary Profile (amount in million)

In the audit of two on-going and five completed projects, a number of deficiencies were

noted:

Table XLI - List of Projects with Audit Observations (Amounts in million)



1. Program Evaluation

Second Agrarian Reform Communities Project (ARCP2)

Full and timely attainment of objectives and targets of the PGBS is at risk in view of the low utilization of the allocated fund, and issues encountered in implementation. Of the total allocated fund of ₱1.120 billion, about 73 percent or ₱812.621 million was released by DBM, of which only 36.78 percent or ₱298.896 million was utilized leaving a balance of ₱513.725 million as of December 31, 2016. The low utilization/disbursement was caused by the non-compliance of the LGUs with the documentary requirements for the release of the Capital Grant (CG) and Capability Development Grant (CDG). The Project will be consummated in CY 2018.

Resolve issues/problems that hamper or delay timely implementation of the project and take appropriate steps to address the identified factors contributory to the low utilization of fund; and coordinate closely with the DAR PMO to strategize and ensure the timely and full implementation of the project within the considerable time frame prior to its closure on June 30, 2018.


9 TOTAL 7 501.40 24,954.31 440.00 21,898.19 9.00 448.09 61.41 3,056.12

3 Ongoing 2 107.47 5,348.43 46.06 2,292.31 9.00 448.09 61.41 3,056.12

6 Completed 5 393.94 19,605.89 393.94 19,605.89 - - - -


CountProject Status

Project

Count

Net Loan Commitments Cumulative Availments


TOTAL 501.40 24,954.31 440.00 21,898.19 9.00 448.09 61.41 3,056.12

ADB1667 PHI ARCP 72.60 3,613.03 72.60 3,613.03 - - - -

IBRD 4109 PH ARCDP 1 49.67 2,472.13 49.67 2,472.13 - - - -

IBRD 4108 PH 81.77 4,069.64 81.77 4,069.64 - - - -

JBIC PH-P184 81.32 4,047.05 81.32 4,047.05 - - - -

IBRD 7470 PH NPS-ENRMP 50.00 2,488.44 50.00 2,488.44 - - - -

IBRD 4446 PH LOGO FIND 58.58 2,915.59 58.58 2,915.59 - - - -

ADB2465 PHI 67.00 3,334.52 30.98 1,541.91 5.15 256.14 36.02 1,792.61

OPEC 1225-P 30.00 1,493.07 4.82 239.69 2.59 128.93 25.18 1,253.38

KFW

No.7113011

HSRP 10.47 520.83 10.26 510.70 1.27 63.03 0.20 10.13

OngoingARCP II

TEEP

Loan No. Project NameProject

Status

Cumulative Availments CY Availments Undrawn Balance Net Loan Commitments

Completed

77



Existing rules and regulations governing financial transactions were not strictly observed in the following instances:


(In Mil. ₱)

NPS- ENRMP

Proceeds from the refund made by LGU of unexpended balances and unutilized cash balances from completed projects were not remitted to the National Treasury.

3.420

INFRES 0.043

US PL 146 0.018

LOGO FIND (MDFO)

0.247

ARCDP1 Proceeds from the refund made by LGU of unexpended balances and unutilized cash balances from completed projects were not remitted to the National Treasury.

0.086

ARCP 0.037

CBRMP 0.399

KR2 0.476

MDP3 0.109

TEEP 3.358

MRDP2 Unutilized cash balance of completed project/programs was not remitted to the National Treasury pursuant to Executive Order (EO) 421 dated May 30, 2005.

104.777

MCDP II 151.313

MCDP III 0.002

ARCP2 and HSRASP

Unreliable Information embodied in the Budget and Financial Accountability Reports (BFARs) submitted due to :

a. Reported Current Year’s Obligations without

valid commitments; b. Overstatement of reported disbursements;

and c. Non-maintenance of Registries of Allotments,

Obligations and Disbursements

0

Remit the total amount of unutilized/unexpended balances to the National Treasury pursuant to Executive Order No. 431 and 338.

Require LGUs to immediately remit to the BTr the unutilized/unexpended balances/fund for completed projects.

Make sure that obligations incurred and disbursements paid are valid, legal and with proper documentation; and maintain applicable registries as prescribed by GAM to ensure proper monitoring of allotment received, obligations incurred, and actual disbursements paid.


The account “Due from LGUs” of the following projects cannot be relied upon due to unliquidated fund transfers for completed projects:

Project Amount

(In Mil. ₱)

NPS- ENRMP 0.509 LOGO FIND (MDFO) 0.244

Management to continue collaborating with the LGUs to effectively enforce the immediate liquidation of outstanding balances and/or refund of any unspent balance.

78

4.2 Common Audit Observations of Other Agencies with ODA Loans


A. Reliability of Financial Account Balances

The following accounts cannot be relied upon due to:

IA Project FS

Account Deficiency

Amount (In Mil.)

DILG ENP PPE Overstatement due to the inclusion of unserviceable equipment. ENP equipment in 14, out of 16 Regions, are no longer operating or already unserviceable at year-end. The two regions with serviceable ENP equipment are Regions IVB and X.

1,229.025

Allowance for Depre-ciation

Understatement as the ENP equipment in Regions II, IV-B, X, XI and XIII have no provision for depreciation.

154.536

MWSS MNWSDP, UATP & MSSP

CIP/PPE Overstatement due to inclusion of completed projects and un-reconciled accounts.

613.559

DPWH RIIDP MRIP NRIMP 2 UBCPRD PHUMP III RUPP POPSTIRP

Construc-tion in Progress – Infrastruc-ture Assets (CIP-IA) & PPE

Overstatement due to completed infrastructure projects still recorded under the CIP-IA account.

6.285

NRIMP 2 CIP – Buildings and Other Structure (BOS) & Computer Software Account

Overstatement due to inclusion of contracts on the procurement of computer software considered as intangible assets, which was erroneously classified as CIP – Buildings and Other Structure (BOS) accounts. The said transaction also understated the Computer Software (10801020) account due to misclassification.

0.584

a. Reclassify unserviceable

equipment to Other Assets account to separate assets without economic value from those used in operation ; and

b. Consider the disposal of unserviceable ENP equipment to prevent further damage and deterioration and drop from the books of accounts the disposed equipment, if any.

c. Provide allowance for depreciation of the ENP equipment to reflect the correct net book value of the equipment.

a. Correct accounting entries and reclassify completed projects/transactions to their appropriate assets account.

79


IA Project FS

Account Deficiency

Amount (In Mil.)

POPSTIRP MRIP ARDP V UBCPRD

Advances to Contrac-tors

Unrecouped advances to contractors balances pertaining to terminated foreign loans/grant assisted projects to be transferred to the Regular Agency Fund (Fund Cluster 01)

0.435

NFA USPL Title I Program

Loans Payable- Foreign

Variance between the records of NFA and the Commodity Credit Corporation (CCC) pertaining to the former’s Loans Payable-Foreign account balance at year-end.

8.085

DOH EU-HSPSP II

Advances to Regions

Unliquidated fund transfers since CY 2013 to present. This is due to inadequate monitoring and coordination of program managers.

25.902

PPE, AP & DLC

Unrecorded deliveries of 27 Mobile Dental Vehicles and non-recording of payment thereby understating the Property and Equipment Account and overstating both the Accounts Payable and Deposits on Letter of Credit Accounts

577.758

a. Carefully analyse and establish the status of all projects relating to terminated loans with unrecouped advances to contractors; and transfer all analysed accounts pertaining to terminated foreign loan assisted projects to the RA Fund (Fund Cluster 01) books to correct the balance of Advances to Contractors account.

a. Reiterated that

Management exert effort in pursuing the reconciliation of its records with the records of the CCC; and obtain copies of documents from the creditor evidencing the payment made on the loans and the corresponding interests.

a. Require immediate liquidation of funds transferred in 2013 and 2014;

b. Verify if funded projects are still existing, otherwise, request from implementing regions the return of funds transferred to determine the amount of unutilized fund from the grant proceeds for reversion to BTr. (EU-HSPSP II)

Facilitate submission of documents to Accounting Services for recording purposes. (EU-HSPSP II)

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IA Project FS

Account Deficiency

Amount (In Mil.)

Various projects

Inventories & PPE

Non-preparation/ maintenance or submission of reports of issuances by the Property Officer.

32.073 46.234

a. Exert all efforts in gathering

documents to substantiate

preparation of reports of

inventory and property

issuances; and

b. Coordinate with Program

Implementers still connected

with the DOH in order to

facilitate submission of

reports to the Accountant for

recording.

B. Project Evaluation

1. The Market Transformation through Introduction of

Energy Efficient Electric Vehicles (E-Trikes) Project of the DOE, with project cost of ₱21.672 billion, has registered a low loan utilization of only 0.35 percent, as of December 31, 2016. Despite availability of 3,000 E-Trikes, the project has not delivered a single unit to its intended beneficiaries due to inability of the Department of Energy to identify the LGUs committed to distribute the procured e-trikes to the local tricycle drivers which further delayed Project implementation. The project is one year away from the scheduled project completion.

a. Revisit/assess project

feasibility considering that it has not delivered a single e-trike unit after the lapse of four years; and

b. Consider recommending the cancellation of loan as soon as practicable to avoid further commitment fees and financial charges.

2. Out of the 595 FAPs projects programmed for implementation/completion as of CY 2016, 161 or 27.06% were completed, 106 or 17.81% were on-going, and 328 or 55.13% were not yet started. Eighteen (18) of these projects amounting to ₱1.104 billion have Right-of-Way (ROW) problems which could delay project implementation. (RUPP, CLLEX I, ARBP II, MMICP VI, DCBCP, PMRCIP III, IDRR-CCA, FRIMP-CDOR, FRIMP-CTI, UBCPRD, RIIDP, NRIMP II, DPWH Bridge Construction/Replacement Project)

a. Immediately address issues

and concerns affecting project completion;

b. Facilitate settlement of

RROW problems to avoid further delay in project implementation; and

c. Consider excluding in the

scope of works of proposed projects portions with unresolved ROW/clearance issues, if warranted.

3. The targeted disbursements for relending per

Agricultural Credit Support Project (ACSP) loan agreement were not attained due to lack of robust marketing strategies by the LBP to promote the project that resulted in only 71.52 percent utilization rate and payment of ₱18.725 million in commitment fees, as at December 31, 2016. Also, the responsibilities of the concerned units of the bank in the marketing and

In future development programs, to ensure that the funds can be relent by the LBP to the target market and minimize the payment of commitment fees for unutilized funds, the bank should:

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promotion, as well as monitoring and technical assistance to beneficiaries as provided in the guidelines were not fully performed.

a. Conduct thorough feasibility

study to determine the number of potential borrowers and the amount that will be sourced from foreign borrowings;

b. Revisit marketing strategies

to ensure that LCs/LUs and other concerned units of the Bank will be able to widely promote/advertise the program to the target market;

c. Include provisions which

allow flexibility in the reallocations of loan proceeds from one category to another;

d. Ensure compliance with the

guidelines formulated for a certain program particularly on marketing and promotion;

e. Make sure that LCs/LUs

continue to conduct field validation;

f. Establish timely

communication and coordination between PMD 1 and LCs/LUs with regard to submission of the required reports, and monitoring and evaluation of the projects enrolled under the Program.

4. The Project was 100 percent accomplished using only $148,162.12 or 91 percent of the total availed grant of $163,000.00 realizing savings of $14,837.88. The availed grant of $163,000.00 represents 84.89 percent of the total grant of $192,000.00. Under this Project, DOH received a prize money worth $100,000 from the Bloomberg Philanthropies for its Red Orchid Award in recognition of its contribution in the advancement of policies and measures on tobacco control in the country consistent with WHO FCTC Articles. (Boosting the Implementation of the Philippine National Tobacco Control Strategy (NTCS 2011-2016) in Selected

The Audit Team commended the good performance of the Project Team and encourage the IA to pursue the sustainability plan and proper turn-over of the same before final closure of the project.

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Strategic Objectives – Phase II (BIP RIOC 401B))

5. Implementation of EU-HSPSP II project was delayed due to slow procurement process and inadequate monitoring and coordination between program managers, resulting in non-availment of grant amounting to €4,916,667.00, lapsed allotment of ₱24.942 million and cash reversion of ₱0.752 million to the Bureau of Treasury. (EU-HSPSP II)

Coordinate with the Program Managers to fast tract the submission of required documents and facilitate procurement processes that are causing the delayed implementation/completion of the funded projects.

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4.3 General Audit Recommendations

In view of the significance of the foregoing observations and the need for appropriate

actions by the Implementing Agencies and oversight agencies, we recommend the following:

4.3.1 For the Implementing Agencies

4.3.1.1 Consider project readiness and ability to implement, own and maintain the

project before submitting project design/proposal to ensure smooth implementation of the project and avoid delay and unnecessary commitment fees and other charges;

4.3.1.2 Identify potential/actual problems and root causes of delays in project

implementation using among others, the NEDA-PMS Quarterly Alert Mechanism Report and take necessary and appropriate measures to address the same;

4.3.1.3 Exert best efforts to comply with loan conditionalities within the prescribed

period/target date to facilitate project start-up activities;

4.3.1.4 Strictly follow existing accounting and auditing rules and regulations on the grant, utilization and liquidation of cash advance/fund transfer to prevent accumulation of account balances;

4.3.1.5 Maintain the required accounting records and reconcile reciprocal and

related accounts including cash account and bank balances;

4.3.1.6 Conduct regular physical inventory of supplies and equipment and reconcile accounting and property records.

4.3.2 For the Oversight Agencies

4.3.2.1 National Economic Development Authority

4.3.2.1.1 Sustain the review of necessity of projects, project design and

implementation strategies, and absorptive capacity of implementing agencies to undertake and own projects; and

4.3.2.1.2 In the review of project feasibility studies, consider lessons

learned from similar projects as aid in determining project design deficiencies and viability under review.

4.3.2.2 Department of Finance

4.3.2.2.1 Facilitate request for loan cancellation with the Foreign Funding

Institutions (FFIs) to minimize payment of commitment fees. Ensure that the amounts of loans contracted are necessary and can be absorbed by the IAs;

4.3.2.2.2 Institute a system where IAs are informed of commitment fees

paid by the NG due to delays in project implementation and require explanation from the IAs on the causes of delay; and

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4.3.2.2.3 Establish effective networking among IAs, LGUs, DBM and other concerned agencies. Facilitate compliance with loan conditions to ensure loan effectiveness and timely completion of projects.

4.3.2.3 Department of Budget and Management

4.3.2.3.1 Ensure adequate and timely release of project funds, both

loan/grant proceeds and GOP counterpart funds; 4.3.2.3.2 Consider inclusion of debt service and commitment fees against

implementing agencies’ budget for proper accountability and reporting of expenditures; and

4.3.2.3.3 Release immediately the Non-Cash Availment Authority to

facilitate the recording of settlement of liabilities for goods delivered and services rendered.

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4.4 Status of Implementation of Prior Years’ Audit Recommendations

Out of the 506 prior years’ audit recommendations included in prior years’ Consolidated Annual Audit Reports of 27 National Government Agencies and Government Owned and Controlled Corporations, 251 or 50 percent were implemented, 151 or 30 percent were partially implemented or implementation in-progress, while 104 or 20 percent were yet to be implemented, as presented in Table XXII.

Table XLII- Status of Implementation of PY's Audit Recommendations

Gov't

Sector

No. of Agen-cies

Projects Implemented Partially

Implemented Not

Implemented Totals

% Share per

Sector

CGS 11 20 35 47 26 108 21.34

NGS 16 63+ 216 104 78 398 78.66

TOTAL 27 83+ 251 151 104 506 100

Percen-tage

50% 30% 20% 100%

Among the reasons cited for the partial or non-implementation of the audit

recommendations are:

Failed biddings of projects; Fortuitous events like bad weather condition; Lack of manpower complement; Management’s inaction in effecting adjustments due to, among others,

incomplete turned-over documents or non-availability of documents, delayed preparation of completion reports, unsettled billings, non-creation of committee to conduct examination and verification of operator’s books of accounts;

Uncorrected weaknesses in existing processes and procedures; Unclean database and/or not updated data/information; Unclear guidelines and criteria in the selection of beneficiaries; Weak coordination between and among parties; Non-reconciliation of records; Delayed issuance by DBM of NCAA; Delayed reconciliation of accounts or reconciliation in process; Non-disposal of unserviceable properties; Agencies plan to seek approval from DBM to utilize unused fund balances; Projects terminated; With pending issues with the Court and/or Arbitral Tribunal; Concerned employees no longer in the service or cannot be located; On-going adjustments of subsidiary ledger; Contractor’s inaction; Non-issuance of demand letters on due and demandable accounts; Delayed and/or non-submission of financial statements, and other financial

and operational reports, and documentary requirements including liquidation reports despite notices and constant follow-ups;

Slow procurement process and Road Right of Way (ROW) issues and concerns;

Ownership/acquisition issues and concerns;

commonwealth avenue, quezon city · 2017-07-03 · 4.1.2 national irrigation administration (nia)...

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