consolidated audit report on the official development ......awol absent without leave bac bids and...

2017

Consolidated Audit Report

on

Official Development Assistance

Programs and Projects

TABLE OF CONTENTS Page

1.0 INTRODUCTION

1.1 Legal Basis 1

1.2 Scope and Sources 2

1.3 Methodology 4

2.0 HIGHLIGHTS OF THE REPORT

2.1 Gross Commitments 6 2.2 Availments 7 2.3 Undrawn Commitments 7 2.4 Repayments 8 2.5 Debt Service Expenditures for the year 8 2.6 Commitment Fees for the year 9 2.7 Audit Observations and Recommendations 9

3.0 STATUS OF ODA-FUNDED PROJECTS

3.1 Cumulative Gross Loan Commitments 10

3.2 Availments 14

3.3 Undrawn Commitments 19

3.4 Repayments 21

3.5 Debt Service Expenditures 25

3.6 Outstanding Balances 28

4.0 AUDIT OBSERVATIONS AND RECOMMENDATIONS

4.1 Consolidated Audit Observations and Recommendations 33

A. Project Sustainability 33

B. Project Implementation and Management 35

C. Financial Management 49

D. Compliance with Existing Laws, Rules and Regulations and Provisions of the MOA

60

E. Reliability of Financial Statements 70

4.2 General Audit Recommendations 76

4.3 Status of Implementation of Prior Years’ Audit Recommendations 77

5.0 CHARTS

I Loan Structure by Sector and Creditor Type Indicating the Number of Loans Contracted and CNLC

3

II Loan Status 6

III CGLC, CL and CNLC 6

IV Schedule of Availments and Undrawn Balances by Type of Creditor 7

V Loan Availments, Repayments and 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 28

IX Number of Loans and Outstanding Balances by Sector 29

6.0 TABLES

I Status and Breakdown of Loans 3

II Current and Cumulative Loan Availments by Project and Government Sector

7

III Debt Service Expenditures by Creditor Type 9

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 Cancelled Commitments for 2017 10

VIII Schedule of Cumulative Net Loan Commitments by Creditor 11

IX Schedule of Cumulative Net Loan Commitments by Sector 13

X Schedule of Cumulative Net Loan Commitments by Implementing Agency

13

XI Cumulative and Current Year Availments by Creditor 14

XII Cumulative and Current Year Availments by Project Sector 16 XIII Cumulative and Current Year Availments by IA 16

XIV Programs and Projects for Implemention by Various IAs out of CY 2017 Availments

17

XV Schedule of Loans with Undrawn Balances by Creditor 19

XVI Schedule of Undrawn Balances by Project Sector 20

XVII Schedule of IAs with Undrawn Balances 21

XVIII Cumulative and Current Year Repayments by Creditor 22

XIX Cumulative and Current Year Repayments by Project Sector 23

XX Cumulative and Current Year Repayments by IA 24

XXI Debt Service Expenditures by Creditor 25

XXII Debt Service Expenditures by Implementing Agencies 26

XXIII Debt Service Expenditures by Project Sector 27

XXIV Changes on Loan Outstanding Balance 28

XXV Outstanding Balances by Specific Creditor 28

XXVI Five Loans under each Project Sector with big Outstanding Balances 30

XXVII Outstanding Balances by Government Sector 31

XXVIII Outstanding Balances by IA 32

XXIX Operational Status of Completed Projects 33

XXX Status of Implementation of PY’s Audit Recommendations 77

4 Ps Pantawid Pamilyang Pilipino Program

AARNR Agriculture, Agrarian Reform and Natural Resources

ABC Approved Budget for the Contract

ACSP Agricultural Credit Support Project

ACT Area Coordinating Teams

ADB Asian Development Bank

AFC Automated Fare Collection

AO Accountable Officer

APP Annual Procurement Plan

ARBP PH II Arterial Road Bypass Project, Phase II

ARCP II Agrarian Reform Communities Project II

ARE Acknowledgement Receipt for Equipment

ARIIP Agno River Integrated Irrigation Project

AWOL Absent without leave

BAC Bids and Awards Committee

BFAR Bureau of Fisheries and Aquatic Resources

BIR Bureau of Internal Revenue

BOC Bureau of Customs

BRS Bank Reconciliation Statement

BS Bank Statements

BSPMC Barangay Sub-project Management Committee

BTr Bureau of the Treasury

CA Certificate of Acceptance

CAAR Consolidated Annual Audit Report

CADF Carbon Asset Development Program

CAMDP Clark Area Municipal Development Project

CAR Cordillera Administrative Region

CAs Cash Advances

CBFMMP Community-Based Forest and Mangrove Management Project

CBRT Cebu Bus Rapid Transit

CCC Commodity Credit Corporation

CCP Coastal Commodity Package

CCT/MCCT Conditional Cash Transfer/Modified Conditional Cash Transfer

CEMTSMMP Capacity Enhancement of Mass Transit Systems in Metro Manila Project

CFI Community Financial Institution

CHARMP Cordillera Highland Agricultural Resource Management Program

CHI-I China National Construction and Agriculture Machinery I

CIB-LCCA Cash in Bank – Local Currency, Current Account

CIP Construction In Progress

CIS Communal Irrigation Systems

CLC Cumulative Loan Cancellation

CNLC Cumulative Net Loan Commitment

CNS/ATM Communication, Navigation, Surveillance/Air Traffic Management

CO Central Office

COA Commission on Audit

CSC Civil Service Commission

CTEs Contract Time Extensions

LIST OF ACRONYMS

LIST OF ACRONYMS

CY Calendar Year

DA Department of Agriculture

DAR Department of Agrarian Reform

DARPO Department of Agrarian Reform Provincial Office

DBM Department of Budget and Management

DBP Development Bank of the Philippines

DENR Department of Environment and Natural Resources

DepEd Department of Education

DFIMDP Diversified Farm Income and Market Development Project

DILG Department of Interior and Local Government

DMAD Debt Monitoring and Analysis Division

DO Department Order

DOE Department of Energy

DOF Department of Finance

DOH Department of Health

DOTr Department of Transportation

DPWH Department of Public Works and Highways

DSWD Department of Social Welfare and Development

DTI Department of Trade and Industry

DV Disbursement Voucher

ECGD Export Credit Guarantee Department - Deutsche Bank

EDC Export Development Corporation

EHRDP Expanded Human Resources Development Program

EIB European Investment Bank

ENP Emergency Network Project

EO Executive Order

EPC Estimated Project Cost

E-Trike Energy Efficient Electric Vehicles Project

EU-HSPSP II EU-Health Sector Policy Support Programme

FAP Foreign-assisted Projects

FAR Financial Accountability Report

FFIs Foreign Funding Institutions

FLAD Foreign Loan Accounting Division

FMP Forest Management Project

FMR Farm-to-Market Road

FO Field Office

FXRC Foreign Exchange Risk Cover

FY Fiscal Year

GAA General Appropriations Act

GAM Government Accounting Manual

GCF General Control Fund

GID Governance and Institutions Development

GMDSSP Global Maritime Distress Safety System Project

GOCCs Government Owned and Controlled Corporations

GPPB Government Procurement Policy Board

GSIS Government Service Insurance System

HOPE Head of the Procuring Entity

LIST OF ACRONYMS

IA Implementing Agency

IARCDSP Italian Assistance to the Agrarian Reform Community Development Support

Program

IBRD International Bank for Reconstruction and Development

I-BUILD Intensified Building up of Infrastructure and Logistics for Development

IIRUP Inventory and Inspection Report of Unserviceable Property

IMA Implementation Management Agreement

IMOs Irrigation Management Offices

Infra Infrastructure

InfRES Infrastructure for Rural Productivity Enhancement Sector Project

INREMP Integrated Natural Resources and Environmental Management Project

I-REAP

Investments in Rural Enterprises and Agriculture and Fisheries Productivity

IRR Implementing Rules and Regulations

ITT Industry, Trade and Tourism

JEV Journal Entry Voucher

JICA Japan International Cooperation Agency

JRMPP Jalaur River Multi Purpose Project Stage

JSDF Japan Social Development Fund

KALAHI-

CIDSS

Kapit-Bisig Laban sa Kahirapan-Comprehensive and Integrated Delivery of

Social Services

KC-AF KALAHI CIDSS - Additional Financing

KC-NCDDP KALAHI CIDSS - National Community-Driven Development Project

LAF Livelihood Assistance Fund

LBP Landbank of the Philippines

LCCA Local Currency Current Account

LCE Local Chief Executive

LD Liquidated Damages

LGUs Local Government Units

LIGs Livelihood Interest Groups

LRT Light Rail Transit

LRTA Light Rail Transit Authority

LRV Light Rail Vehicles

MASELCO Masbate Electric Cooperative

MBUSSP Mindanao Basic Urban Services Sector Project

MCW Magna Carta on Women

MDFO Miunicipal Development Fund Office

MDP Monthly Disbursement Program

MDS Modified Disbursement System

MESP Missionary Electrification Subsidy Program

MIMAROPA Mindoro, Marinduque, Romblon, Palawan

MINSAAD Mindanao Sustainable Agrarian and Agriculture Development

MLGU Municipal Local Government Unit

MM Municipal Monitor

MOA Memorandum of Agreement

MOMARO Mindoro Oriental Marinduque Romblon

MOOE Maintenance and Other Operating Expenses

LIST OF ACRONYMS

MRD Monthly Report of Disbursement

MSCIP Maritime Safety Capability Improvement Project

MSIP III Maritime Safety Improvement Project, Phase 3

MSSP Manila Second Sewerage Project

MWSS Manila Water and Sewerage System

NAC National Advisory Committee

NBAC-SEPP New Bohol Airport Construction and Sustainable Environmet Protection Project

NCA Notice of Cash Allocation

NCAA Non-Cash Availment Authority

ND Notice of Disallowance

NEDA National Economic Development Authority

NFA National Food Authority

NG National Government

NGAs National Government Agencies

NGAS New Government Accounting System

NGDAD National Government Debt Accounting Division

NGOs/POs Non-Governmental Organizations/Peoples' Organization

NIA National Irrigation Administration

NICIS Non-intrusive Container Inspection System

NIS National Irrigation Systems

NISRIP National Irrigation Sector Rehabilitation and Improvement Project

NOL No Objection Letter

NPCO National Project Coordination Office

NPMO National Project Management Office

NPS-ENRMP National Program Support for Environment and Natural Resources

Management Project

NRIMP National Roads Improvement and Management Project

NS Notice of Suspension

NYI Not Yet Implemented

ODA Official Development Assistance

ORs Official Receipts

OTC Over the Counter

PAD Project Appraisal Document

PAR Property Acknowledgment Receipt

PAS Philippine Accounting Standards

PB Progress Billings

PCCP Portland Cement Concrete Pavement

PD Presidential Decree

PEEP Philippine Energy Efficiency Project

PENRO Provincial Environment and Natural Resources Office

PHP Philippine Peso

PIA PHIVIDEC Industrial Authority

PIDP Participatory Irrigation Development Project

PLGU Provincial Local Government Unit

PMO Project Management Office

PMU Project Monitoring Unit

LIST OF ACRONYMS

PO Purchase Order

POPSTIRP Pepeng Short-Term Infrastructure Rehabilitation Projects

PPADP Puerto Princesa Airport Development Project

PPCGCDP Philippine Ports and Coast Giard Capability Development Project

PPE Property, Plant and Equipment

PPELC PPE Ledger Card

PPIADP Puerto Princesa Airport Development Project

PPMIU Provincial Project Management Implementing Unit

PPRPC Pantawid Pamily Regional Program Coordinator

PPSAS Philippine Public Sector Accounting Standards

PR Purchase Request

PRDP Philippine Rural Development Project

PREMRP Pasig River Environment Management and Rehabilitation Project

PRES Philippine Rural Electrification Service

PRRC Pasig River Reconstruction Commission

PS-DBM Procurement Service – Department of Budget and Management

PSO Project Support Office

PTA Philippine Tourism Authority

PTR Property Transfer Form

PWDs Persons with Disabilities

PWS Potable Water System

PWU Provincial Women's Union

QPRO Quarterly Physical Report of Operation

QTP Qualified Third Party

RA Republic Act

RCI Report of Checks Issued

RD Regional Director

RFO Regional Field Office

RFQ Request For Quotation

RIIDP Road Improvement and Institutional Development Project

ROW Right-of-Way

RPCI Report on the Physical Count of Inventory

RPCO Regional Project Coordination Office

RPCPPE Report on the Physical Count of Property, Plant and Equipment

RPMO Regional Project Management Office

RSMI Report of Supplies and Materials Issued

RUPP Road Upgrading & Preservation Project

RZOA Raiffeissen Zentralbank Osterreich Aktiengeselschaft

SARO Special Allotment Release Order

SBC Small Business Corporation

SBMA Subic Bay Metropolitan Authority

SC Supreme Court

SCBAA Statement of Comparison of Budget and Actual Amounts

SCHARMP Second Cordillera Highland Agricultural Resource Management Project

SFP Statement of Financial Performance

SHS Solar Home Systems

SL Subsidiary Ledger

LIST OF ACRONYMS

SP Sub-projects

SPMB Subproject Monitoring Board

SPs Sub-Projects

SPSP Social Protection Support Project

SRCD Social Reform and Community Development

SREs Statement of Receipts and Expenditures

SRPMO Sub-Regional Project Management Office

SRRDP Social Reform Related Feeder Ports Development Projects

SSAF Sources and Application of Funds

SSC Staff Selection Committee

SUSIMO Sub-project Site Management Office

SWD Social Welfare and Development

SWDRP Social Welfare and Development Reform Project

TADP Third Airports Development Project

TCT Transfer Certificate of Title

TE Time Extension

TESDA Technical Education and Skills Development Authority

TIEZA Tourism Infrastructure and Enterprise Zone Authority

TS Technical Specifications

TSC Technical Support Consultant

TSPs Technical Service Providers

TWG Technical Working Group

UBCPRD Urgent Bridges Construction Project-Rural Development

UME-DEMS Upgrading of the Medical Equipment of DEMS

USPL U.S. Public Law

WB World Bank

WFP Work and Financial Plan

WHO World Health Organization

YRP Yolanda Reconstruction Program

ZDN Zamboanga del Norte

ZDS Zamboanga del Sur

ZSP Zamboanga Sibugay Province

1.0 INTRODUCTION

1

CONSOLIDATED AUDIT REPORT ON OFFICIAL DEVELOPMENT ASSISTANCE

FOR THE CALENDAR YEAR 2017

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. As discussed earlier, ODA loans are excluded from foreign debt limit of US$10 billion or its equivalent pursuant to RA No. 8182.

1.2 Scope and Sources 1.2.1 The report contains data on 459 ODA loans consisting of 73 program loans and 386

project loans contracted and guaranteed by the National Government (NG) from January 1, 1995 to December 31, 2017. 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, applies only to loans contracted from January 1, 1995 onward.

The status and breakdown of 459 ODA loans with cumulative net loan commitment (CNLC) 1amounting to P1.93 trillion (US$38.64 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 Resources (AARNR); and Governance and Institutions Development (GID). The graphical presentation of the loan structure by Sector and Creditor Type is shown in Chart I.

Chart I – 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 is 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 43 47 9.24 461.62

2 11 13 1.74 86.89

2 10 12 1.70 85.17

1 1 0.03 1.72

67 325 392 27.63 1,380.29

0 7 7 0.03 1.51

73 386 459 38.64 1,930.31

USD 15.07 23.56

PHP 753.08 1,177.24

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

Closed

Table I – Status and Breakdown of Loans

StatusBreakdown

CNLC

(in billion)

Not Yet Effective

Active

New:

Newly Signed/ Effective

Cancelled

Total

CNLC (in billion) 38.64

1,930.31

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, 2017 to be presented later 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.

US$ PHP

Bilateral 45 6 11 140 20 222 92.85 44.30 37.37 667.52 57.87 18.01 899.91

Commercial 8 1 1 37 12 59 11.51 1.23 0.31 58.07 8.99 1.60 80.12

Multilateral 44 16 13 53 52 178 108.91 174.97 33.55 164.13 468.73 19.02 950.29

Total PhP 97 23 25 230 84 459 213.27 220.50 71.23 889.72 535.59 38.64 1,930.31

4.27 4.41 1.43 17.81 10.72 38.64


Infra. SRCDTotal

Total US$

CNLC by Sector and Creditor Type

(in billion)

AARNR GID ITT Infra. SRCD AARNR GID ITT

Number of Loans Contracted by

Sector

Total

Source/

Creditor

Type

5

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 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.

6


The NG contracted 459 ODA loans (including seven cancelled loans), from 1995 to 2017, with Cumulative Gross Loan Commitments (CGLC) of P2.14 trillion (US$42.93 billion) and Cumulative Net Loan Commitments (CNLC) of P1.93 trillion (US$38.64 billion) for financing 409 programs and projects of the Government. Of the total CNLC, P1.48 trillion (US$29.65 billion), representing 76.75 percent, was availed as of December 31, 2017, leaving total undrawn amount of P448.85 billion (US$8.98 billion). The undrawn amount represents 23.25 percent of the CNLC. On the other hand, of the total amount availed of P1.48 trillion (US$29.65 billion) as of December 31, 2017, cumulative repayment as of the same period amounted to P562.64 billion (US$11.26 billion) leaving outstanding balance of P918.53 billion (US$18.37 billion), as presented in Chart II.

Chart II – Loan Status (in billion PhP)

CGLC CLC CNLC CNLCCum.

Availments

Undrawn

Balances

Cum.

AvailmentsRepayments

Outstanding

Balances

Amount 2,144.68 214.37 1,930.31 1,930.31 1,481.47 448.85 1,481.47 562.64 918.83

Percentage 100.00 10.00 90.00 100.00 76.75 23.25 100.00 37.98 62.02 In 2017, 10 ODA loans were contracted with net loan commitments of P74.85 billion

(US$1.50 billion). Of the net loan commitments, only P299.75 million (US$6.0 million) were availed leaving undrawn amount of P74.55 billion (US$1.49 billion). This amount represents 99.60 percent of the total net loan commitments for the loans contracted during the year. On the other hand, debt service expenditures for 2017 amounted to P66.97 billion inclusive of interest of P16.20 billion, commitment fee of P230.17 million, guaranty fee of P644.21 million and other charges of P1.41 billion.

Of the 409 programs and projects financed out of these loans, 336 were completed, 53

are on-going, 8 are yet to be started, while 12 were cancelled.

2.1 Gross Commitments – P2.14 trillion (US$42.93 billion)

The CGLC from 459 ODA loans as of December 31, 2017 amounted to P2.14 trillion or US$42.93 billion. Of the amount, P214.37 billion (US$4.29 billion) or 10.0 percent represents Cumulative Loan Cancellations (CLC) leaving CNLC of P1.93 trillion (US$38.64 billion), as graphically presented in Chart III.

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

7

(Chart III, continued)

US$ PHP US$ PHP US$ PHP

1 Bilateral 222 20.05 1,001.85 2.04 101.94 18.01 899.91 46.62

2 Commercial 59 1.90 94.78 0.29 14.67 1.60 80.12 4.15

3 Multilateral 178 20.98 1,048.05 1.96 97.76 19.02 950.29 49.23

459 42.93 2,144.68 4.29 214.37 38.64 1,930.31 100.00


Creditor Type No. of

Loan

CGLC CLC CNLC % to

Total

Total

% to CGLC 100.00 10.00 90.00

2.2 Availments – P1.48 trillion (US$29.65 billion)

ODA loans availed by the Government were intended to implement programs and projects of the different sectors. Total cumulative availments from 452 loan accounts (excluding cancelled loans) as of December 31, 2017 amounted to P1.48 trillion (US$29.65 billion). Of the total availments, P70.21 billion (US$1.41 billion) were availed in CY 2017. The current year and cumulative loan availments by creditor type, and distribution by project and government sector are presented in Table II.


1 AARNR 0.14 7.02 9.99

2 GID 0.02 0.99 1.41

3 ITT - - -

4 Infra. 0.31 15.27 21.75

5 0.94 46.93 66.85

Total 1.41 70.21 100.00 Total 1.41 70.21 100.00 Total 1.41 70.21 100.00

1 AARNR 3.42 170.86 11.53

2 GID 3.91 195.58 13.20

3 ITT 1.43 71.22 4.81

4 Infra. 11.86 592.49 39.99

5 9.03 451.33 30.46

Total 29.65 1,481.47 100.00 Total 29.65 1,481.47 100.00 Total 29.65 1,481.47 100.00


76.55

10.63 0.72

3 Multilateral 15.70 784.42 52.95 3 NGAs 22.70

2Commercial 1.60 80.04 2 LGUs 0.21

1,134.10

5.40

Cumulative Availments

1Bilateral 12.35 617.00 41.65 1 GOCCs 6.74

95.66

336.73 22.73

3 Multilateral 1.13 56.60 80.63 3 NGAs

2 LGUs -

SRCD

0.02 0.99

1.34

- -

67.16

2Commercial 1.41

4.34 0.06 3.05

2017 Availments

1Bilateral 0.25 12.61 17.97 1 GOCCs

Project

Sector

Amount % to

Total Creditor Type

Amount % to

Total

Go vern-

ment

Secto r

Amount % to

Total

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

SRCD

2.3 Undrawn Commitments – P448.85 billion (US$8.98 billion)

The undrawn commitments of P448.85 billion (US$8.98 billion) as of December

31, 2017 represents 23.25 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, 2017, summarized by type of creditor.

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

8

(Chart IV, continued)


1 Bilateral 18.01 899.91 12.35 617.00 68.56 5.66 282.91 31.44

2 Commercial 1.60 80.12 1.60 80.04 99.90 0.00 0.08 0.10

3 Multilateral 19.02 950.29 15.70 784.42 82.55 3.32 165.86 17.45

38.64 1,930.31 29.65 1,481.47 76.75 8.98 448.85 23.25


Total

Creditor Type CNLC

Cumulative

Availments % to

CNLC

Undrawn

Commitments % to CNLC

2.4 Repayments – P562.64 billion (US$11.26 billion) and Outstanding Balances – P918.83 billion (US$18.39 billion)

Out of the cumulative availments of P1.48 trillion (US$29.65 billion), P562.64 billion (US$11.26 billion) was already repaid with outstanding balances of P918.83 billion (US$18.39 billion). The amount is equivalent to 62.02 percent of the total cumulative availments which represents balances from 330 loan accounts out of 452 total loan (net of cancelled loans) accounts.

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

as of December 31, 2017, summarized by type of creditor.

Chart V - Loan Availments, Repayments and Balances by Type of Creditor

(in billion)


1 Bilateral 12.35 617.00 5.05 252.16 40.87 7.30 364.84 59.13

2 Commercial 1.60 80.04 1.14 57.14 71.39 0.46 22.90 28.61

3 Multilateral 15.70 784.42 5.07 253.34 32.30 10.63 531.08 67.70

29.65 1,481.47 11.26 562.64 37.98 18.39 918.83 62.02 Total

Creditor Type

Cumulative

Availments Repayments

% to

Avail-

ments

Outstanding

Balances % to

A vailments

2.5 Debt Service Expenditures for the year – P66.97 billion

During the year, the total debt service payments to creditors amounted to P66.97 billion inclusive of interest, commitment fees and other charges, as presented in Table III.

9

Principal Interest Commit-

ment Fees

Guaranty

Fee

Other

Charges Total

% to

Total

1 Bilateral 20,397.97 4,893.28 111.56 462.39 964.34 26,829.55 40.06

2 Commercial 2,521.84 772.40 6.07 50.12 140.47 3,490.89 5.21

3 Multilateral 25,562.95 10,537.82 112.54 131.70 306.87 36,651.88 54.73

48,482.76 16,203.50 230.17 644.21 1,411.69 66,972.32 100.00

72.39 24.19 0.34 0.96 2.11 100.00

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

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

Creditor Type

Total

% to Total

By Project Sector, 36.42 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 7,292.11 2,070.64 47.27 21.55 161.75 9,593.33 14.32

2 GID 11,074.12 2,372.47 1.60 - 268.14 13,716.33 20.48

3 ITT 3,674.43 518.23 0.22 60.51 30.56 4,283.94 6.40

4 Infra. 18,493.26 4,466.42 72.75 562.16 795.15 24,389.74 36.42

5 SRCD 7,948.84 6,775.75 108.33 - 156.07 14,988.98 22.38

48,482.76 16,203.50 230.17 644.21 1,411.69 66,972.32 100.00

72.39 24.19 0.34 0.96 2.11 100.00

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

Sector

Total

% to Total


2.6 Commitment Fees for the year – P230.17 million

Commitment fees paid for 35 loan accounts during the year alone for the undrawn balance amounted to P230.17 million or 0.24 percent of the undrawn balances of these accounts amounting to P96.11 billion, as presented in Table V.

NG Direct NG-

Guaranteed

NG

Relent Total

1 Bilateral 18 50,401.15 76.59 34.97 - 111.56 0.22

2 Commercial 2 61.78 6.07 - - 6.07 9.82

3 Multilateral 15 45,647.31 112.32 0.22 - 112.54 0.25

35 96,110.24 194.98 35.18 - 230.17 0.24

84.71 15.29 - 100.00


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

Total

% to Total

Creditor TypeUndrawn

Balance

Commitment Fees % to

Undrawn

balance

No. of

Loans

2.7 Audit Observations and Recommendations

The audit observations and recommendations, summarized and 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) – P2.14 trillion (US$42.93 billion)

As discussed earlier, of the 459 loans contracted by the NG as of December 31, 2017 with CGLC amounting to P2.14 trillion (US$42.93 billion), 10 loans amounting to P74.85 billion (US$1.50 billion), representing 3.49 percent, were secured and signed during the year.

The 10 new loans were secured by NGAs and GOCCs with 48.29 percent of the gross

commitment going to the Social Reform and Community Development Sector with the DILG, TESDA/DTI/DOLE and BTr/SEC as the implementing agencies. The projects to be financed from the new loans for implementation by 11 NGAs and LBP are tabulated in Table VI.

During the year, commitments amounting to P19.91 billion (US$398.53 million)

covering eight loan accounts were cancelled, as presented in Table VII.


TOTAL 1.50 74.85 100.00 0.01 0.30 100.00 1.49 74.55 100.00

Agriculture, Natural Resources & Agrarian Reform 0.12 6.02 8.05 0.01 0.30 100.00 0.11 5.72 7.68

1 PH-P264 Harnessing Agribusiness

Opportunities through Robust

and Vibrant Entrepreneurship

LBP JICA 0.04 2.19 36.42 - - - 0.04 2.19 38.32

2 8762-PH Inclusive Partnerships for

Agricultural Competitiveness

Project

DAR IBRD 0.07 3.31 55.01 - - - 0.07 3.31 57.89

3 200000177

3-PH

Scaling-Up the Second

Cordillera Highland

Agricultural Resource

DA IFAD 0.01 0.52 8.57 0.01 0.30 100.00 0.00 0.22 3.78

Infrastructure 0.66 32.83 43.86 - - 0.00 0.66 32.83 44.03

4 3589-PHIInfrastructure Preparation

and Innovation Facility

DOTr/

DPWHADB 0.10 5.00 15.22 - - - 0.10 5.00 15.22

5 PH-P265Cavite Industrial Area Flood

Risk Management ProjectDPWH JICA 0.14 7.09 21.59 - - - 0.14 7.09 21.59

6 8784-PH

Metro Manila Flood

Management Project (MMFMP -

Phase 1) (cofinanced w ith

AIIB)

DPWH/

MMDAIBRD 0.21 10.37 31.59 - - - 0.21 10.37 31.59

7000023-1-

PHL

Metro Manila Flood

Management Project (MMFMP -

Phase 1) (cofinanced w ith

IRBD)

DPWH/

MMDAAIIB 0.21 10.37 31.59 - - - 0.21 10.37 31.59

Social Reform & Community Development 0.72 36.00 48.10 - - 0.00 0.72 36.00 48.29

8 CPH 1026

01 R

Local Governance Finance

and Fiscal Decentralization

Reform Program, Subprogram

2

DILG AFD 0.12 6.03 16.74 - - - 0.12 6.03 16.74

9 3530-PHI Facilitating Youth-School-to-

Work Transition Program -

Subprogram 1

TESDA/

DTI/DOLEADB 0.30 14.99 41.63 - - - 0.30 14.99 41.63

10 3595-PHI Encouraging Investment

through Capital Market

Reforms Program -

Subprogram 2

BTr/SEC ADB 0.30 14.99 41.63 - - - 0.30 14.99 41.63

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

No.Name of Project IA

Cre-

ditor

Commitments % to

Total

Availments % to

Total

Undrawn Balance % to

Total

USD PHP

398.53 19,909.81

AGRICULTURE, AGRARIAN REFORM AND NATURAL RESOURCES 1.65 82.60

1 PH-P242 Agrarian Reform Infrastructure Support Project,

Phase III

DAR JBIC 1.15 57.67

Total

Table VII - Cancelled Commitments for 2017 (in million)

Loan Account No. Name of Project IA CreditorAmount

11

3.1.1 By Creditor

The CNLC, considering cancellations as of December 31, 2017, is presented by creditor in Table VIII.

USD PHP

2 2311 PHI Integrated Coastal Resources Management Project DENR ADB 0.50 24.94

INFRASTRUCTURE 396.66 19,816.39

3 PH-P243 Environmental Development Project DBP JBIC 0.28 14.10

4 2964-PHI Market Transformation through Introduction of

Energy Efficient Electric Vehicles Project

DOE ADB 268.06 13,391.76

5 8261-PHI Market Transformation Thru Introduction of Energy

Efficient Electric Vehicles Project

DOE ADB 91.70 4,581.06

6 BAC (213.469) Improvement of Nat'l Secondary Road System DPWH BAC 0.07 3.46

7 PH-P244 Agricultural Credit Support Project LBP JBIC 36.55 1,826.00

SOCIAL REFORM AND COMMUNITY DEVELOPMENT 0.22 10.81

8 KFW

No.7113011

Health Sector Reform Project DOH KFW 0.22 10.81


(Table VII, continued)

Loan Account No. Name of Project IA CreditorAmount

USD PHP USD PHP USD PHP

459 42,929.69 2,144,681.28 4,290.98 214,368.60 38,638.71 1,930,312.67 100.00

Bilateral 222 20,053.80 1,001,847.64 2,040.45 101,936.99 18,013.34 899,910.66 46.62

1 JICA 125 15,475.74 773,136.94 1,622.98 81,080.61 13,852.76 692,056.33 35.85

2 ECGD 5 771.36 38,535.54 - - 771.36 38,535.54 2.00

3 BNP PARIBAS 4 1,065.45 53,227.53 344.56 17,213.55 720.89 36,013.99 1.87

4 KEXIM 15 629.10 31,428.80 14.71 735.12 614.39 30,693.68 1.59

5 AFD 5 556.26 27,789.42 - - 556.26 27,789.42 1.44

6 KFW 21 344.90 17,230.55 35.00 1,748.70 309.90 15,481.85 0.80

7 USPL 10 235.00 11,740.13 0.87 43.59 234.13 11,696.54 0.61

8 AIIB 1 207.60 10,371.44 - - 207.60 10,371.44 0.54

9 IBRD 1 207.60 10,371.44 - - 207.60 10,371.44 0.54

10 ICO 9 117.36 5,863.17 0.02 1.00 117.34 5,862.16 0.30

11 ANZ/EFIC 1 97.68 4,879.77 2.32 115.69 95.36 4,764.08 0.25

12 EFIC 3 89.48 4,470.48 0.22 10.86 89.27 4,459.62 0.23

13 FP 9 46.56 2,326.20 2.45 122.42 44.11 2,203.78 0.11

14 EIB 1 36.68 1,832.28 - - 36.68 1,832.28 0.09

15Natixis

(French Gov't)1 34.40 1,718.60 - - 34.40 1,718.60 0.09

16 Artigiancassa 1 31.59 1,578.19 - - 31.59 1,578.19 0.08

17 KFAED 1 21.29 1,063.82 1.54 76.80 19.76 987.02 0.05

18 SOCIETE GEN 1 15.09 753.96 - - 15.09 753.96 0.04

19 KBC 1 13.69 684.03 0.00 0.00 13.69 684.03 0.04

20 Fortis Bank 1 10.23 511.09 - - 10.23 511.09 0.03

21 ITALY II 1 9.79 489.02 0.04 2.17 9.75 486.85 0.03

22 Belgian 1 7.62 380.43 0.06 2.88 7.56 377.55 0.02

23 JFA 1 4.86 242.72 0.04 1.80 4.82 240.92 0.01

24 SFD 1 20.00 999.16 15.64 781.20 4.36 217.97 0.01

No. of

Loans

Table VIII- Schedule of Cumulative Net Loan Commitments by Creditor

(in million)

CreditorCGLC CLC CNLC % to

Total

CNLC

Total

Commitments

12

Inclusive of the CNLC are current year’s commitments on new loans amounting to P74.85 billion (US$1.50 billion) as presented in Table VI.

3.1.2 By Project Sector

Of the CNLC, 46.09 percent was intended for the implementation of projects categorized under the infrastructure sector account, as presented in Table IX.


25 SIDA 1 2.24 112.02 0.01 0.59 2.23 111.43 0.01

26 LEONIA BANK 1 2.22 110.91 0.00 0.00 2.22 110.91 0.01

Multilateral 178 20,978.62 1,048,049.84 1,956.94 97,764.59 19,021.68 950,285.26 49.23

1 ADB 86 11,535.35 576,282.95 1,187.59 59,329.82 10,347.75 516,953.13 26.78

2 IBRD 72 9,103.56 454,795.75 742.56 37,096.64 8,361.01 417,699.11 21.64

3 IFAD 11 201.21 10,052.20 8.76 437.71 192.45 9,614.49 0.50

4 OPEC 6 97.00 4,845.93 16.37 817.56 80.63 4,028.36 0.21

5 EIB 1 26.50 1,323.89 - - 26.50 1,323.89 0.07

6 NDF 2 15.00 749.13 1.66 82.85 13.34 666.28 0.03

Commercial 59 1,897.27 94,783.79 293.59 14,667.03 1,603.68 80,116.76 4.15

1 CEXIM 6 790.52 39,492.61 220.60 11,020.64 569.92 28,471.97 1.47

2 BAC 6 236.14 11,797.00 0.07 3.46 236.07 11,793.54 0.61

3 ECGD 5 142.97 7,142.68 - - 142.97 7,142.68 0.37

4 EDC 2 124.44 6,216.77 2.26 112.96 122.18 6,103.82 0.32

5BNP

PARIBAS5 147.21 7,354.24 38.22 1,909.29 108.99 5,444.95 0.28

6 CAMC 2 59.97 2,995.76 4.07 203.23 55.90 2,792.54 0.14

7 BBV 5 52.15 2,605.36 0.02 1.00 52.13 2,604.36 0.13

8 RZOA 2 47.10 2,353.09 - - 47.10 2,353.09 0.12

9 FP 10 40.09 2,002.93 2.19 109.19 37.91 1,893.74 0.10

10 CCDF 2 45.54 2,274.89 14.58 728.56 30.95 1,546.34 0.08

11Banco

Santander1 25.75 1,286.61 - - 25.75 1,286.61 0.07

12 ANZ/EFIC 1 23.44 1,171.14 0.59 29.42 22.85 1,141.72 0.06

13 BA 1 22.50 1,124.05 0.02 1.13 22.48 1,122.92 0.06

14 ERSTE 1 21.91 1,094.80 0.00 0.00 21.91 1,094.80 0.06

15 NIB 1 21.38 1,068.06 - - 21.38 1,068.06 0.06

16 ICO 1 18.95 946.57 - - 18.95 946.57 0.05

17 ING Bank 1 17.61 879.72 - - 17.61 879.72 0.05

18 EFIC 1 14.80 739.38 0.72 36.08 14.08 703.30 0.04

19 SOCIETE GEN 1 12.65 632.00 0.12 5.77 12.54 626.23 0.03

20 Fortis Bank 1 7.99 399.38 - - 7.99 399.38 0.02

21 Bancaja 1 7.01 350.42 - - 7.01 350.42 0.02

22 SIDA 1 10.00 499.58 3.81 190.15 6.19 309.43 0.02

23 NDF 1 7.14 356.73 6.33 316.15 0.81 40.58 0.00

0.00 - less than five thousand.


No. of

Loans

(Table VIII, continued)

CreditorCGLC CLC CNLC % to

Total

CNLC

13

3.1.3 By Implementing Agency

Around 80.36 percent of the CNLC represents loans by the NGAs of which 26.51 and 15.87 percent were availed by the DOF and DPWH, respectively. The implementing agencies (IAs) of the loans secured are presented in Table X.

USD PHP% to

TotalUSD PHP

% to

TotalUSD PHP

% to

Total

Infra. 20.44 1,021.36 47.62 2.63 131.64 61.41 17.81 889.72 46.09

SRCD 10.88 543.38 25.34 0.16 7.78 3.63 10.72 535.59 27.75

GID 4.94 246.75 11.51 0.53 26.26 12.25 4.41 220.50 11.42

AARNR 5.10 254.56 11.87 0.83 41.28 19.26 4.27 213.27 11.05

ITT 1.57 78.64 3.67 0.15 7.41 3.46 1.43 71.23 3.69

Total 42.93 2,144.68 100.00 4.29 214.37 100.00 38.64 1,930.31 100.00

% to CGLC


Table IX - Schedule of Cumulative Net Loan Commitments by Sector (in billion)

Project

Sector

CGLC Cumulative Cancellation CNLC

10.00 90.00100.00


Total 459 42,929.69 2,144,681.28 4,290.98 214,368.60 38,638.71 1,930,312.67 100.00

NGAs 323 33,665.72 1,681,872.28 2,616.47 130,713.83 31,049.25 1,551,158.45 80.36

1 DOF 41 10,802.65 539,678.86 561.39 28,046.07 10,241.26 511,632.79 26.51

2 DPWH 87 6,475.35 323,495.35 344.42 17,206.49 6,130.93 306,288.86 15.87

3 DOTr 42 5,116.51 255,610.64 389.59 19,462.94 4,726.92 236,147.71 12.23

4 DSWD 9 2,765.23 138,145.26 4.41 220.10 2,760.82 137,925.16 7.15

5 DepEd 13 1,622.43 81,053.14 76.97 3,845.04 1,545.46 77,208.10 4.00

6 DAR 25 1,327.97 66,342.53 105.41 5,266.15 1,222.55 61,076.38 3.16

7 DA 23 1,229.53 61,425.09 204.92 10,237.41 1,024.61 51,187.68 2.65

8 DILG 11 755.34 37,735.27 43.76 2,186.39 711.58 35,548.88 1.84

9 DENR 13 803.54 40,143.04 408.09 20,387.18 395.45 19,755.86 1.02

10 DOE 4 778.51 38,892.90 403.73 20,169.61 374.78 18,723.29 0.97

11 TESDA 6 370.72 18,520.40 7.30 364.65 363.42 18,155.75 0.94

12 SC 2 321.90 16,081.48 1.29 64.44 320.61 16,017.04 0.83

13 DOH 19 339.90 16,980.95 27.49 1,373.23 312.42 15,607.72 0.81

14 BTr/SEC 1 300.00 14,987.40 - - 300.00 14,987.40 0.78

15 BOC 2 184.76 9,230.26 0.12 6.05 184.64 9,224.21 0.48

16 BFAR 9 178.50 8,917.71 20.36 1,017.23 158.14 7,900.49 0.41

17 PRRC 2 88.69 4,430.88 12.00 599.51 76.69 3,831.37 0.20

18 OCD 1 60.31 3,012.97 - - 60.31 3,012.97 0.16

19 BFP 2 49.44 2,469.88 - - 49.44 2,469.88 0.13

20 NAMRIA 1 25.75 1,286.61 - - 25.75 1,286.61 0.07

21 DOT 1 18.12 905.18 0.70 34.87 17.42 870.31 0.05

22 PMMA 2 16.03 801.06 0.10 4.82 15.94 796.24 0.04

23 UP 2 13.56 677.35 - - 13.56 677.35 0.04

24 OP 4 9.98 498.54 0.14 7.00 9.84 491.54 0.03

25 BIR 1 11.00 549.54 4.30 214.65 6.70 334.88 0.02

GOCCs 129 9,033.42 451,291.40 1,656.82 82,771.28 7,376.60 368,520.12 19.09

1 DBP 24 1,706.88 85,272.13 296.90 14,832.56 1,409.98 70,439.57 3.65

Table X - Schedule of Cumulative Net Loan Commitments by Implementing Agency

(in million)

IACGLC Cumulative Cancellation CNLC

% to

Total

CNLC

No. of

Loans

14

3.2 Availments – P1.48 trillion (US$29.65 billion)

As of December 31, 2017, cumulative availments reached P1.48 trillion (US$29.65

billion), equivalent to 76.75 percent of the CNLC, as presented in Chart II. Of the total availments, P70.21 billion (US$1.41 million) or 4.74 percent were availed during the year. 3.2.1 By Creditor

The cumulative and current year availments from different creditors are presented in Table XI with cumulative availments from multilateral and bilateral creditors at 80.63 percent and 17.97 percent, respectively. Only around 1.41 percent was availed for commercial loans.


2 LBP 23 1,371.69 68,526.72 170.56 8,521.06 1,201.12 60,005.66 3.11

3 PSALM 18 1,459.70 72,923.87 297.96 14,885.68 1,161.74 58,038.19 3.01

4 NIA 13 842.67 42,098.09 53.83 2,689.29 788.84 39,408.80 2.04

5 LRTA 7 885.78 44,251.91 145.04 7,246.16 740.74 37,005.76 1.92

6 BCDA 1 525.90 26,272.99 8.00 399.86 517.90 25,873.13 1.34

7 MWSS 6 394.46 19,706.53 29.83 1,490.42 364.63 18,216.11 0.94

8 PPA 4 258.58 12,918.11 8.50 424.64 250.08 12,493.47 0.65

9 LWUA 7 273.84 13,680.29 90.23 4,507.57 183.61 9,172.73 0.48

10 NLRC 2 400.00 19,983.20 219.21 10,951.05 180.79 9,032.15 0.47

11 SBMA 5 246.58 12,318.41 73.06 3,650.07 173.51 8,668.34 0.45

12 PNOC 2 180.98 9,041.59 87.36 4,364.12 93.63 4,677.47 0.24

13 PHIVIDEC 1 73.63 3,678.58 0.01 0.45 73.62 3,678.13 0.19

14 NPC 3 213.48 10,664.88 148.10 7,399.02 65.37 3,265.86 0.17

15 SBGFC 3 56.22 2,808.48 0.26 12.97 55.96 2,795.51 0.14

16 PNR 2 46.68 2,332.24 0.01 0.28 46.68 2,331.96 0.12

17 PFDA 1 24.99 1,248.20 - - 24.99 1,248.20 0.06

18 NFA 3 19.86 992.09 0.04 1.89 19.82 990.20 0.05

19PTA

(TIEZA)1 12.04 601.67 0.01 0.67 12.03 601.01

0.03

20 LLDA 2 15.00 749.37 8.20 409.49 6.80 339.88 0.02

21 PEZA 1 24.46 1,222.04 19.70 984.06 4.76 237.99 0.01

LGUs 7 230.55 11,517.59 17.68 883.49 212.86 10,634.10 0.55

1 ARMM 6 191.99 9,591.52 6.46 322.89 185.53 9,268.63 0.48

2 PG-LDN 1 38.55 1,926.07 11.22 560.61 27.33 1,365.47 0.07


(Table X, continued)

IACGLC Cumulative Cancellation CNLC

% to

Total

CNLC

No. of

Loans

USD PHP USD PHP

Total Availments 459 29,654.25 1,481,466.99 100.00 1,405.30 70,205.95 100.00

Bilateral 222 12,350.44 617,003.36 41.65 252.50 12,614.17 17.97

1 JICA 125 9,776.84 488,431.19 32.97 237.02 11,841.19 16.87

2 ECGD 5 544.95 27,224.73 1.84 - - -

3 BNP PARIBAS 4 378.80 18,924.04 1.28 - - -

4 AFD 5 377.87 18,877.43 1.27 - - -

5 KEXIM 15 284.83 14,229.55 0.96 15.47 772.98 1.10

6 KFW 21 279.69 13,972.82 0.94 - - -

% to

Total

Table XI- Cumulative and Current Year Availments by Creditor (in million )

CreditorNo. of

Loans

Cumulative Availments CY Availments % to

Total

15

USD PHP USD PHP

7 USPL 10 234.13 11,696.54 0.79 - - 0.00

8 ICO 9 117.34 5,862.15 0.40 - - -

9 ANZ/EFIC 1 95.36 4,764.08 0.32 - - -

10 EFIC 3 89.27 4,459.62 0.30 - - -

11 FP 9 44.11 2,203.74 0.15 - - -

12 EIB 1 30.09 1,503.28 0.10 - - -

13 KFAED 1 19.76 987.02 0.07 - - -

14 SOCIETE GEN 1 14.59 729.12 0.05 - - -

15 KBC 1 13.69 684.03 0.05 - - -

16 Fortis Bank 1 10.23 511.09 0.03 - - -

17 ITALY II 1 9.75 486.85 0.03 - - -

18 Artigiancassa 1 7.95 397.34 0.03 - - -

19 Belgian 1 7.56 377.55 0.03 - - -

20 JFA 1 4.82 240.92 0.02 - - -

21 SFD 1 4.36 217.97 0.01 - - -

22 SIDA 1 2.23 111.43 0.01 - - -

23 LEONIA BANK 1 2.22 110.91 0.01 - - -

Multilateral 178 15,701.68 784,424.74 52.95 1,133.03 56,603.83 80.63

1 ADB 86 8,822.32 440,745.60 29.75 472.89 23,624.57 33.65

2 IBRD 72 6,666.57 333,048.28 22.48 646.62 32,304.05 46.01

3 IFAD 11 117.91 5,890.36 0.40 7.23 361.02 0.51

4 OPEC 6 58.36 2,915.72 0.20 6.29 314.18 0.45

5 EIB 1 23.19 1,158.50 0.08 - - -

6 NDF 2 13.34 666.28 0.04 - - -

Commercial 59 1,602.12 80,038.89 5.40 19.78 987.95 1.41

1 CEXIM 6 569.61 28,456.44 1.92 - - -

2 BAC 6 234.82 11,731.24 0.79 19.78 987.95 1.41

3 ECGD 5 142.97 7,142.68 0.48 - - -

4 EDC 2 122.18 6,103.82 0.41 - - -

5 BNP PARIBAS 5 108.99 5,444.95 0.37 - - -

6 CAMC 2 55.90 2,792.54 0.19 - - -

7 BBV 5 52.13 2,604.36 0.18 - - -

8 RZOA 2 47.10 2,353.09 0.16 - - -

9 FP 10 37.91 1,893.71 0.13 - - -

10Credit Com'l de

France2 30.95 1,546.34 0.10 - - -

11 Banco Santander 1 25.75 1,286.61 0.09 - - -

12 ANZ/EFIC 1 22.85 1,141.72 0.08 - - -

13 Bank of America 1 22.48 1,122.92 0.08 - - -

14 ERSTE 1 21.91 1,094.80 0.07 - - -

15 NIB 1 21.38 1,068.06 0.07 - - -

16 ICO 1 18.95 946.55 0.06 - - -

17 ING Bank 1 17.61 879.72 0.06 - - -

18 EFIC 1 14.08 703.30 0.05 - - -

19 SOCIETE GEN 1 12.54 626.23 0.04 - - -

20 Fortis Bank 1 7.99 399.38 0.03 - - -

21 Bancaja 1 7.01 350.42 0.02 - - -

22 SIDA 1 6.19 309.43 0.02 - - -

23 NDF 1 0.81 40.58 0.00 - - -


% to

Total

(Table XI, continued)

CreditorNo. of

Loans

Cumulative Availments CY Availments % to

Total

16


Cumulatively, the infrastructure sector is the greatest beneficiary of ODA loans at 39.99 percent. However, for current year, the SRCD sector availed significant percentage of the loan at 66.85 percent.


The NGAs’ availments reached P1.13 trillion (US$22.70 billion) or 76.55 percent of the total cumulative availments. The GOCCs availed P336.73 billion (US$6.74 billion) or 22.73 percent while LGUs availed P10.63 billion (US$0.21 billion) or 0.72 percent. The cumulative and current year availments by IAs, grouped by government sector, is presented in Table XIII.

USD PHP USD PHP

Total Availments 29.65 1,481.47 100.00 1.41 70.21 100.00

1 Infra. 11.86 592.49 39.99 0.31 15.27 21.75

2 SRCD 9.03 451.33 30.46 0.94 46.93 66.85

3 GID 3.91 195.58 13.20 0.02 0.99 1.41

4 AARNR 3.42 170.86 11.53 0.14 7.02 9.99

5 ITT 1.43 71.22 4.81 - - 0.00

CY Availments % to

Total

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

CreditorCumulative Availments % to

Total

USD PHP USD PHP

Total Availments 458 29.65 1,481.47 100.00 1.41 70.21 100.00

NGAs 322 22.70 1,134.10 76.55 1.34 67.16 95.66

1 DOF 41 9.74 486.78 32.86 - - -

2 DPWH 87 4.23 211.12 14.25 0.18 9.06 12.90

3 DSWD 9 2.07 103.35 6.98 0.56 27.98 39.85

4 DOTr 42 1.35 67.58 4.56 0.08 3.81 5.43

5 DepEd 13 1.28 63.91 4.31 0.13 6.46 9.21

6 DAR 25 0.95 47.26 3.19 0.02 1.15 1.64

7 DA 23 0.69 34.38 2.32 0.10 4.81 6.85

8 DILG 11 0.59 29.52 1.99 0.25 12.49 17.79

9 DOE 4 0.34 16.79 1.13 - - -

10 SC 2 0.32 16.02 1.08 - - -

11 DOH 19 0.31 15.59 1.05 - - -

12 DENR 13 0.22 10.97 0.74 0.01 0.40 0.57

13 BOC 2 0.18 9.22 0.62 - - -

14 BFAR 9 0.10 4.78 0.32 0.00 0.01 0.01

15 PRRC 2 0.08 3.83 0.26 - - -

16 TESDA 6 0.06 3.13 0.21 - - -

17 OCD 1 0.06 3.01 0.20 - - -

18 BFP 2 0.05 2.41 0.16 0.02 0.99 1.41

19 NAMRIA 1 0.03 1.29 0.09 - - -

20 DOT 1 0.02 0.87 0.06 - - -

21 PMMA 2 0.02 0.80 0.05 - - -

22 UP 2 0.01 0.68 0.05 - - -

23 OP 4 0.01 0.49 0.03 - - -

% to

Total

CY Availments % to

Total

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

IACumulative AvailmentsNo. of

Loans

17

DOF and DPWH availed most of the loan with percentage share of 32.86 and 14.25, respectively, of the total cumulative availments of P1.48 trillion (US$29.65 billion). During the year, DSWD had the highest at 39.85 percent of the total current year availments. The programs and projects for which loans were availed in CY 2017, implemented by various agencies are presented in Table XIV.

USD PHP USD PHP

24 BIR 1 0.01 0.33 0.03 - - -

GOCCs 129 6.74 336.73 22.73 0.06 3.05 4.34

1 DBP 24 1.40 70.10 4.73 - - -

2 PSALM 18 1.16 58.04 3.92 - - -

3 LBP 23 1.01 50.55 3.41 0.05 2.34 3.33

4 LRTA 7 0.74 37.01 2.50 - - -

5 NIA 13 0.53 26.30 1.78 0.01 0.65 0.92

6 BCDA 1 0.52 25.87 1.75 - - -

7 MWSS 6 0.25 12.62 0.85 0.00 0.06 0.08

8 PPA 4 0.25 12.49 0.84 - - -

9 NLRC 2 0.18 9.03 0.61 - - -

10 SBMA 5 0.17 8.67 0.59 - - -

11 LWUA 7 0.12 5.88 0.40 0.00 0.01 0.01

12 PNOC 2 0.09 4.68 0.32 - - -

13 PHIVIDEC 1 0.07 3.68 0.25 - - -

14 NPC 3 0.07 3.27 0.22 - - -

15 SBGFC 3 0.06 2.80 0.19 - - -

16 PNR 2 0.05 2.33 0.16 - - -

17 PFDA 1 0.02 1.25 0.08 - - -

18 NFA 3 0.02 0.99 0.07 - - -

19 PTA (TIEZA) 1 0.01 0.60 0.04 - - -

20 LLDA 2 0.01 0.34 0.02 - -

21 PEZA 1 0.00 0.24 0.02 - - -

LGUs 7 0.21 10.63 0.72 - - -

1 ARMM 6 0.19 9.27 0.63 - - -

2 PG-LDN 1 0.03 1.37 0.09 - - -

0.00 - less than five million

% to

Total

CY Availments % to

Total

(Table XIII continued)

IACumulative AvailmentsNo. of

Loans

USD PHP

1,405.30 70,205.95 100.00

1,344.28 67,157.77 95.66

560.04 27,978.51 39.85

1 3369-PHI 100.00 4,995.80

2 ADB2662

PHI

1.03 51.39

3 3100-PHI 100.40 5,015.71

4 8335-PH 138.61 6,924.84

5 8584-PH Social Welfare Development and Reform

Project 2

220.00 10,990.76

Table XIV - Programs and Projects for Implemention by Various IAs out of CY 2017 Availments

(in million)

IA/ Loan Account No./Project Name CreditorCY Availments

% to Total

Total

NGAs

DSWD

IBRD

Social Protection Support Project

ADB

KALAHI-CIDSS National Community-

Driven Development Project

18

USD PHP

250.00 12,489.50 17.79

1 3505-PHI Local Government Finance and Fiscal

Decentralization Reform Program -

Subprogram 2

ADB 250.00 12,489.50

181.33 9,058.71 12.90

1 PH-P261 Davao City Bypass Construction Project

(South and Center Sections)0.63 31.37

2JBIC PH-

P253

Flood Risk Management Project for

Cagayan River, Tagoloan River, and Imus

River

17.52 875.30

3 PH-P259 Flood Risk Management Project for CDO

River1.47 73.63

4 PH-P258 Metro Manila Interchange Construction

Phase VI0.40 19.75

5 PH-P260 Metro Manila Priority Bridges Seismic

Improvement Project0.61 30.42

6IBRD 7552

PH

National Roads Improvement and

Management Project 2IBRD 15.75 786.75

7 PHL-17 Integrated Disaster Risk Reduction and

Climate Change Adaptation Measures in

the Low Lying Areas of Pampanga Bay

0.32 16.11

8 PHL-18 Panguil Bay Bridge Project 0.63 31.43

9OPEC

1446P

Road Improvement and Institutional

Development ProjectOPEC 4.85 242.31

10JBIC PH-

P250

Arterial Road Bypass Project, Phase II9.20 459.56

11JBIC PH-

P249

Central luzon Link Expressway Project35.39 1,767.81

12JBIC PH-

P252

Pasig-Marikina River Channel

Improvement Project, Phase III

24.87 1,242.29

13 PH-P247 Road Upgrading and Preservation 60.95 3,045.11

14ADB2836-

PHI

Road Improvement and Institutional

DevelopmentADB 8.74 436.86

129.40 6,464.57 9.21

1 8344-PH Learning, Equity and Accountability

Program Support Project

IBRD 129.40 6,464.57

96.26 4,808.92 6.85

1 IBRD 8421-

PH

Phillippine Rural Development Project IBRD 89.86 4,489.37

2 200000177

3-PH

Scaling-Up the Second Cordillera

Highland Agricultural Resource

6.00 299.75

4 IFAD 749-

PH

Second Cordillera Highland Agricultural

Resource Mgnt. Project (CHARM2)

1.60 79.91

5 IFAD 767-

PH

Rapid Food Production Enhancement

Programme

(1.20) (60.11)

76.27 3,810.47 5.43

1 JBIC PH-

P228

New Communications, Navigations

Surveillance/Air Traffic Mgmt. (CNS/ATM)

System Development ProjectJICA

11.85 592.00

2 PH-P255 Capacity Enhancement of Mass Transit

Systems in Metro Manila Project

1.83 91.47

3 PH-P256 New Bohol Airport Construction and

Sustainable Environmet Protection Project

13.16 657.23

4 PH-P257 Maritime Safety Capability Improvement

Project for the Philippine Coast Guard

34.92 1,744.33

5 PHL-11-

EDCF

Puerto Princesa Airport Development

Project

KEXIM 14.52 725.44

23.10 1,154.06 1.64

1 ADB2465

PHI

Agrarian Reform Communities Project II ADB 7.80 389.62

(Table XIV, continued)


% to Total

DA

DOTr

DAR

JICA

DILG

JICA

DepEd

DPWH

KEXIM

JICA

IFAD

19

3.3 Undrawn Commitments – P448.85 billion (US$8.98 billion)

Of the 459 ODA loans from 43 creditors, commitments for 96 loans from 19 creditors were not fully drawn with undrawn balances of P448.85 billion (US$8.98 billion) as of December 31, 2017.

3.3.1 By Creditor

The loans with biggest undrawn balances or unavailed commitments are loans from JICA under bilateral creditors which represent 45.37 percent of the total undrawn balances. The loans with undrawn balances are presented in Table XV.

USD PHP

2 JBIC PH-

P251

Mindanao Sustainable Agrarian and

Agriculture Development Project

JICA 13.86 692.57

3 OPEC

1225-P

Agrarian Reform Communities and

Projects II

OPEC 1.44 71.87

19.78 987.95 1.41

1 AG. No.

234.967

Capability Building Program, Phase II BAC 19.78 987.95

7.96 397.79 0.57

1JBIC PH-

P248

Forestland Management ProjectJICA

3.58 178.63

2ADB2311

PHI

Integrated Coastal Resources

Management Project

(0.02) (1.11)

3 2957-PHI 3.72 186.09

5 I-890-PH IFAD 0.68 34.17

0.15 7.30 0.01

1 PH-1258 Fisheries, Coastal Resources and

Livelihood ProjectIFAD 0.15 7.30

61.01 3,048.18 4.34

46.81 2,338.75 3.33

1 8162-PH Metro Manila Waste Water Management

Project

IBRD 46.30 2,312.89

2 JBIC PH-

P244 Agricultural Credit Support Project JICA 0.52 25.86

12.99 648.73 0.92

1IBRD 7709

PH

Participatory Irrigation Development

Project

IBRD 6.70 334.87

2JBIC PH-

P254

National Irrigation Sector Rehabilitation

and Improvement Project

JICA 6.28 313.86

1.11 55.46 0.08

1 3377-PHI Angat Water Transmission Improvement

Project

ADB 1.11 55.46

0.10 5.23 0.01

1 3389-PHI Water District Development Sector Project ADB 0.10 5.23

LWUA

(Table XIV, continued)


% to Total

NIA

MWSS

DENR

BFAR

GOCCs

LBP

Integrated Natural Resources and

Environmental Management Project

ADB

BFP

USD PHPNo. of

LoansUSD PHP

% to

Total

Total 1,153.78 57,640.31 90 8,984.46 448,845.69 100.00

Bilateral 251.98 12,588.31 48 5,662.90 282,907.30 63.03

1 JICA 236.51 11,815.34 21 4,075.93 203,625.14 45.37

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

Creditor

Cumulative Availments Undrawn Balances

20


The infrastructure sector with the highest cumulative net commitments has also the biggest undrawn balances of P297.23 billion (US$5.95 billion) representing 66.22 percent of the total undrawn balances of P448.85 billion (US$8.98 billion), as presented in Table XVI.

USD PHPNo. of

LoansUSD PHP

% to

Total

2 BNP PARIBAS - - 3 342.09 17,089.94 3.81

3 KEXIM 15.47 772.98 8 329.56 16,464.14 3.67

4 ECGD - - 3 226.41 11,310.81 2.52

5 AIIB - - 1 207.60 10,371.44 2.31

6 IBRD - - 1 207.60 10,371.44 2.31

7 AFD - - 2 178.39 8,911.99 1.99

8 Natixis (French Gov't) - - 1 34.40 1,718.60 0.38

9 KFW - - 3 30.21 1,509.03 0.34

10 Artigiancassa - - 1 23.64 1,180.85 0.26

11 EIB - - 1 6.59 329.00 0.07

12 SOCIETE GEN - - 1 0.50 24.85 0.01

13 FP - - 1 0.00 0.04 0.00

14 ICO - - 1 0.00 0.02 0.00

Multilateral 882.02 44,064.04 37 3,320.00 165,860.52 36.95

1 IBRD 646.62 32,304.05 12 1,694.44 84,650.83 18.86

2 ADB 221.88 11,084.78 15 1,525.43 76,207.53 16.98

3 IFAD 7.23 361.02 6 74.55 3,724.13 0.83

4 OPEC 6.29 314.18 3 22.27 1,112.64 0.25

5 EIB - - 1 3.31 165.39 0.04

Commercial 19.78 987.95 5 1.56 77.87 0.02

1 BAC 19.78 987.95 2 1.25 62.30 0.01

2 CEXIM - - 1 0.31 15.52 0.00

3 FP - - 1 0.00 0.03 0.00

4 ICO - - 1 0.00 0.02 0.00

Loans fully availed are not included in the list.


(Table XV, continued)

Creditor

Cumulative Availments Undrawn Balances

USD PHP USD PHPNo. of

LoansUSD PHP

1 Infra. 17,809.37 889,720.43 11,859.68 592,485.76 55 5,949.69 297,234.66 66.22

2 SRCD 10,720.87 535,593.36 9,034.13 451,327.06 14 1,686.74 84,266.31 18.77

3 ARRNR 4,269.05 213,273.34 3,419.98 170,855.46 22 849.07 42,417.88 9.45

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

Creditor

CNLC Cumulative Availments Undrawn Balances% to

Total

21


DOTr has the highest undrawn balance which represent 37.56 percent of the total undrawn amount and 89.46 percent of the CNLC. There were no availments from loans intended for the construction/implementation of North-South Commuter Railway Project, Cebu Bus Rapid Transit Project and Maritime Safety Capability Improvement Project II with total CNLC of P116.26 billion (US$2.33 billion). This amount alone already represents 25.90 percent of the total undrawn amount. Along with DOTr are 13 other agencies with unavailed commitments ranging from 53.84 percent to 100.00 percent as of December 31, 2017, as shown in Table XVII.

3.4 Repayments – P562.64 billion (US$11.26 billion)

As of December 31, 2017, cumulative repayments to principal loans reached P562.64 billion (US$11.26 billion), which is equivalent to 37.98 percent of the total cumulative


LoansUSD PHP

4 GID 4,413.68 220,498.70 3,914.95 195,582.84 2 498.74 24,915.85 5.55

5 ITT 1,425.73 71,226.84 1,425.51 71,215.86 3 0.22 10.98 0.00

Total 38,638.71 1,930,312.67 29,654.25 1,481,466.99 96 8,984.46 448,845.69 100.00

% to CNLC 100.00 76.75 23.25


(Table XVI, continued)

Creditor

CNLC Cumulative Availments Undrawn Balances% to

Total


LoansUSD PHP

Total 13,130.22 655,959.37 4,145.76 207,113.68 91 8,984.46 448,845.69 100.00 68.43

NGAs 12,077.41 603,363.02 3,729.20 186,303.34 76 8,348.21 417,059.68 92.92 69.12

1 DOTr 3,771.70 188,426.46 397.45 19,855.75 14 3,374.25 168,570.71 37.56 89.46

2 DPWH 3,084.74 154,107.30 1,179.72 58,936.67 27 1,905.01 95,170.63 21.20 61.76

3 DSWD 1,701.10 84,983.75 1,008.98 50,406.67 4 692.12 34,577.08 7.70 40.69

4 DOF 500.00 24,979.00 2.50 124.90 1 497.50 24,854.11 5.54 99.50

5 DA 549.91 27,472.23 213.54 10,667.88 4 336.37 16,804.36 3.74 61.17

6 TESDA 307.00 15,337.11 6.24 311.60 2 300.76 15,025.50 3.35 97.97

7 BTr/SEC 300.00 14,987.40 - - 1 300.00 14,987.40 3.34 100.00

8 DAR 683.39 34,140.88 406.85 20,325.44 9 276.54 13,815.44 3.08 40.47

9 Deped 600.00 29,974.80 333.75 16,673.48 2 266.25 13,301.32 2.96 44.38

10 DENR 201.27 10,054.95 25.33 1,265.40 3 175.94 8,789.56 1.96 87.42

11 DILG 208.28 10,405.15 87.65 4,378.66 2 120.63 6,026.49 1.34 57.92

12 BFAR 67.34 3,364.28 4.82 240.74 2 62.52 3,123.54 0.70 92.84

13 DOE 40.24 2,010.37 1.57 78.64 2 38.67 1,931.73 0.43 96.09

14 BFP 49.44 2,469.88 48.20 2,408.13 2 1.24 61.75 0.01 2.50

15 DOH 13.00 649.45 12.60 629.38 1 0.40 20.07 0.00 3.09

1,052.81 52,596.35 416.56 20,810.34 15 636.25 31,786.01 7.08 60.43

1 NIA 429.35 21,449.32 166.97 8,341.59 4 262.37 13,107.73 2.92 61.11

2 LBP 351.47 17,558.54 162.25 8,105.76 4 189.21 9,452.78 2.11 53.84

3 MWSS 123.30 6,159.82 11.26 562.37 1 112.04 5,597.45 1.25 90.87

4 LWUA 72.30 3,612.13 6.41 320.08 2 65.90 3,292.04 0.73 91.14

5 DBP 54.32 2,713.62 47.59 2,377.68 2 6.72 335.94 0.07 12.38

6 NPC 22.08 1,102.92 22.08 1,102.85 2 0.00 0.07 0.00 0.01


GOCCs

Table XVII - Schedule of IAs with Undrawn Balances (in million)

Sector/ IA

Cumulative Availments Undrawn Balances% to

Total

% to

C N LC

CNLC

Loans fully availed are not included in the list.

22

availments of P1.48 trillion (US$29.65 billion). This is relatively higher by 1.55 percent compared to 2016 repayments in relation to availments of only 36.43 percent. Of this amount, P48.04 billion (US$0.96 billion) or 8.54 percent represent repayments during the year. Comparative figures in five years are presented in Chart VI.

Chart VI – Comparative Repayments in relation to Availments

3.4.1 By Creditor

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

USD PhP USD PhP

2017 29.65 1,481.47 11.26 562.64 37.98

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

Year

Cumulative

Availments

(in billion)

Cumulative

Repayments

(in billion)

% to

Cumulative

Availments

USD PHP USD PHP

Total Repayment 11,262.25 562,639.37 100.00 961.54 48,036.53 100.00

Bilateral 5,047.45 252,160.59 44.82 413.51 20,658.19 43.01

1 JICA 3,575.02 178,600.77 31.74 321.22 16,047.47 33.41

2 ECGD 535.59 26,756.92 4.76 3.12 155.94 0.32

3 BNP PARIBAS 198.20 9,901.65 1.76 37.88 1,892.40 3.94

4 KFW 144.64 7,225.73 1.28 5.54 276.69 0.58

5 USPL 134.05 6,697.08 1.19 10.66 532.73 1.11

6 ANZ/EFIC 95.36 4,764.08 0.85 - - -

7 EFIC 89.27 4,459.62 0.79 - - -

8 KEXIM 72.35 3,614.58 0.64 11.26 562.50 1.17

9 ICO 49.54 2,475.13 0.44 5.58 278.52 0.58

10 AFD 36.19 1,807.78 0.32 12.06 602.59 1.25

11 EIB 30.09 1,503.28 0.27 - - -

12 FP 19.13 955.55 0.17 1.78 88.74 0.18

13 KFAED 18.50 924.18 0.16 1.26 62.84 0.13

14 Fortis Bank 10.23 511.09 0.09 - - -

15 ITALY II 9.75 486.85 0.09 - - -

16 SOCIETE GEN 8.76 437.47 0.08 1.46 72.91 0.15

17 KBC 8.22 410.42 0.07 1.10 54.72 0.11

18 SFD 4.36 217.97 0.04 - - -

19 JFA 2.89 144.55 0.03 0.24 12.05 0.03

20 SIDA 2.23 111.43 0.02 - - -

21 LEONIA BANK 2.22 110.91 0.02 - - -

22 Belgian 0.87 43.58 0.01 0.36 18.07 0.04

Multilateral 5,071.07 253,340.64 45.03 500.30 24,994.07 52.03

1 ADB 3,382.92 169,004.02 30.04 317.70 15,871.46 33.04

2 IBRD 1,618.30 80,847.22 14.37 175.52 8,768.59 18.25

3 OPEC 24.32 1,215.10 0.22 3.66 182.72 0.38

4 EIB 23.19 1,158.50 0.21 - - -

Table XVIII - Cumulative and Current Year Repayments by Creditor (in million)

CreditorCumulative Repayments % to

Total

CY Repayments % to

Total

23


Of the cumulative and current year repayments, 55.52 percent and 39.19 percent, respectively, were paid for the loans falling under the infrastructure sector accounts as presented in Table XIX.

3.4.3 By implementing Agency

The details on repayments by government sector and implementing agency showing that NGAs’ share represent 66.56 percent and 79.38 percent of the cumulative and current year repayments, respectively, are presented in Table XX.

USD PHP USD PHP

5 IFAD 20.33 1,015.85 0.18 3.16 157.98 0.33

6 NDF 2.00 99.94 0.02 0.27 13.33 0.03

Commercial 1,143.72 57,138.14 10.16 47.73 2,384.27 4.96

1 CEXIM 290.73 14,524.20 2.58 25.92 1,294.95 2.70

2 ECGD 142.97 7,142.68 1.27 - - -

3 EDC 122.18 6,103.82 1.08 - - -

4 BAC 119.50 5,969.87 1.06 13.20 659.30 1.37

5 BNP PARIBAS 105.47 5,269.11 0.94 0.54 27.05 0.06

6 CAMC 55.90 2,792.54 0.50 - - -

7 BBV 52.13 2,604.36 0.46 - - -

8 FP 34.83 1,740.06 0.31 1.27 63.38 0.13

9 Credit Com'l de

France

30.95 1,546.34 0.27 - - -

10 RZOA 27.43 1,370.28 0.24 3.81 190.27 0.40

11 Banco

Santander

25.75 1,286.61 0.24 - - 0.40

12 ANZ/EFIC 22.85 1,141.72 0.23 - - -

13 Bank of America 22.48 1,122.92 0.20 - - -

14 NIB 21.38 1,068.06 0.20 - - -

15 ING Bank 17.61 879.72 0.19 - - -

16 EFIC 14.08 703.30 0.16 - - -

17 SOCIETE GEN 12.54 626.23 0.12 - - -

18 ERSTE 8.22 410.55 0.11 1.83 91.23 0.19

19 Fortis Bank 7.99 399.38 0.00 0.80 40.18 0.08

20 SIDA 6.19 309.43 0.00 - - -

21 Bancaja 2.40 119.66 0.00 0.34 17.09 0.04

22 NDF 0.15 7.30 0.00 0.02 0.81 0.00

- Loans without repayments for the current year are either fully paid or still within the grace period.

(Table XVIII, continued)

CreditorCumulative Repayments % to

Total

CY Repayments % to

Total

USD PHP USD PHP

Total Repayments 11,262.25 562,639.37 100.00 961.54 48,036.53 100.00

1 Infra. 6,253.10 312,392.33 55.52 376.84 18,825.98 39.19

2 GID 1,806.85 90,266.83 16.04 214.37 10,709.58 22.29

3 AARNR 1,423.19 71,099.72 12.64 130.70 6,529.35 13.59

4 SRCD 1,066.83 53,296.45 9.47 160.01 7,993.54 16.64

5 ITT 712.28 35,584.04 6.32 79.63 3,978.09 8.28

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

Project SectorCumulative Repayments % to

Total

CY Repayments % to

Total

24

USD PHP USD PHP

Total 11,262.25 562,639.37 100.00 961.54 48,036.53 100.00

NGAs 7,496.11 374,490.79 66.56 763.28 38,131.71 79.38

1 DOF 2,551.92 127,488.57 22.66 309.95 15,484.36 32.23

3 DPWH 1,931.46 96,491.72 17.15 150.92 7,539.50 15.70

4 DOTr 749.31 37,433.94 6.65 36.41 1,818.88 3.79

5 DAR 433.86 21,674.97 3.85 46.88 2,342.21 4.88

6 DepEd 392.35 19,600.82 3.48 56.69 2,832.12 5.90

7 DILG 280.99 14,037.82 2.49 9.75 487.14 1.01

8 DA 244.29 12,204.45 2.17 27.86 1,391.94 2.90

9 DOE 208.60 10,421.03 1.85 26.39 1,318.47 2.74

10 DOH 158.90 7,938.36 1.41 20.68 1,033.26 2.15

11 SC 118.24 5,907.28 1.05 24.27 1,212.54 2.52

12 DENR 103.13 5,152.24 0.92 12.34 616.64 1.28

13 BOC 75.90 3,792.04 0.67 12.31 614.95 1.28

14 DSWD 74.95 3,744.55 0.67 15.64 781.50 1.63

15 BFAR 59.52 2,973.31 0.53 2.40 120.04 0.25

16 PRRC 32.61 1,629.04 0.29 4.42 220.87 0.46

17 NAMRIA 25.75 1,286.61 0.23 - - 0.00

18 TESDA 23.87 1,192.73 0.21 3.47 173.38 0.36

19 PMMA 8.66 432.77 0.08 0.30 14.82 0.03

20 UP 8.60 429.54 0.08 0.33 16.52 0.03

21 OP 6.63 331.37 0.06 0.24 12.00 0.02

22 DOT 4.00 199.76 0.04 0.57 28.53 0.06

23 BIR 1.68 83.79 0.01 0.56 27.93 0.06

24 BFP 0.88 44.10 0.01 0.88 44.10 0.09

GOCCs 3,627.77 181,236.00 32.21 192.46 9,614.73 20.02

1 PSALM 1,161.74 58,038.19 10.32 - - 0.00

2 LBP 519.34 25,945.22 4.61 39.49 1,972.97 4.11

3 DBP 445.28 22,245.11 3.95 38.41 1,919.05 3.99

4 LRTA 330.94 16,533.34 2.94 31.72 1,584.58 3.30

5 NIA 197.87 9,885.31 1.76 22.08 1,103.26 2.30

6 NLRC 180.79 9,032.15 1.61 - - 0.00

7 PPA 178.27 8,906.01 1.58 6.29 314.08 0.65

8 MWSS 119.72 5,981.04 1.06 14.85 741.69 1.54

9 BCDA 110.37 5,514.01 0.98 16.98 848.30 1.77

10 PNOC 93.63 4,677.47 0.83 - - 0.00

11 SBMA 64.95 3,244.97 0.58 6.14 306.66 0.64

12 LWUA 64.88 3,241.12 0.58 5.08 253.63 0.53

13 NPC 51.43 2,569.33 0.46 1.08 53.71 0.11

14 PFDA 24.99 1,248.20 0.22 - - 0.00

15 PHIVIDEC 19.31 964.79 0.17 2.41 120.59 0.25

16 NFA 17.89 893.83 0.16 0.55 27.65 0.06

17 SBGFC 17.27 862.87 0.15 3.09 154.30 0.32

18 PNR 17.03 850.59 0.15 3.11 155.30 0.32

19 PTA (TIEZA) 7.34 366.48 0.07 0.59 29.32 0.06

20 PEZA 2.56 127.72 0.02 0.23 11.61 0.02

21 LLDA 2.17 108.26 0.02 0.36 18.04 0.04

LGUs 138.37 6,912.58 1.23 5.81 290.09 0.60

1 ARMM 126.11 6,300.04 1.12 4.60 229.84 0.48

2 PG-LDN 12.26 612.54 0.11 1.21 60.25 0.13

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

IACummulative Repayments % to

Total

CY Repayments % to

Total

25

3.5 Debt Service Expenditures for CY 2017 – P66.97 billion

Total debt service for the year amounted to P66.97 billion which is relatively higher by P5.85 billion or 9.57 percent when compared to debt service expenditures in 2016. Of the total payments, P 48.48 billion represents payment to principal which accounts to 72.39 percent of the total debt service expenditure for 2017. The remaining balance, which accounts to 27.61 percent represents payment for interest, commitment fee, guaranty fee and other charges as presented in Chart VII.

Chart VII - Debt Service Expenditures (in billion PhP)

3.5.1 By Creditor

Of the total debt service expenditures, P36.65 billion, equivalent to 54.73 percent represent payments to multilateral creditors with the biggest payments made to ADB in the amount of P21.52 billion representing 32.13 percent of the total debt service as presented in Table XXI.

GRAND TOTAL 66,972.32 100.00 48,482.76 16,203.50 230.17 644.21 1,411.69

Bilateral 26,829.55 40.06 20,397.97 4,893.28 111.56 462.39 964.34

1 JICA 20,447.92 30.53 15,319.85 3,870.89 89.96 446.64 720.57

2 BNP PARIBAS 2,186.34 3.26 1,799.96 264.61 - - 121.78

3 USPL 1,632.23 2.44 1,238.17 389.10 - - 4.96

4 KEXIM 702.97 1.05 546.24 137.81 - - 18.92

5 AFD 674.49 1.01 520.83 78.62 18.69 - 56.36

6 KFW 369.77 0.55 287.30 60.65 2.91 15.75 3.17

7 ICO 312.37 0.47 264.98 36.22 - - 11.17

8 ECGD 170.88 0.26 148.32 15.96 - - 6.60

9 FP 117.52 0.18 78.46 31.32 - - 7.74

10 SOCIETE GEN 66.82 0.10 59.89 0.30 - - 6.63

11 KFAED 64.32 0.10 59.60 3.91 - - 0.81

12 KBC 52.01 0.08 47.30 - - - 4.71

13 JFA 15.71 0.02 11.46 3.34 - - 0.92

14 Belgian 15.62 0.02 15.62 - - - -

15 Artigiancassa 0.56 0.00 - 0.56 - - 0.00

Commercial 3,490.89 5.21 2,521.84 772.40 6.07 50.12 140.47

1 CEXIM 1,735.74 2.59 1,257.47 396.90 - 49.24 32.12

2 BAC 808.98 1.21 569.85 160.99 1.60 - 76.54

Other

Charges

Table XXI - Debt Service Expenditures by Creditor

Particulars

Amount (in million PHP)

Total % to

TotalPrincipal Interest

Commit-

ment Fee

Guaranty

Fee

% of Increase

9.57

26


The BTr payments for loans directly used by the NGAs and those relent to GOCCs amounted to P56.67 billion of which P40.98 billion or 72.31 percent represents payment to principal while P15.69 billion or 27.68 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 P10.31 billion as presented in Table XXII.

3 FP 538.45 0.80 392.19 138.92 4.47 0.89 1.99

4 RZOA 228.12 0.34 164.46 47.09 - - 16.57

5 ERSTE 111.88 0.17 78.85 24.85 - - 8.17

6 Fortis Bank 37.02 0.06 34.73 0.94 - - 1.35

7 BNP PARIBAS 26.88 0.04 23.38 - - - 3.49

8 ICO 2.69 0.00 - 2.69 - - 0.00

9 NDF 1.14 0.00 0.92 - - - 0.23

Multilateral 36,651.88 54.73 25,562.95 10,537.82 112.54 131.70 306.87

1 ADB 21,519.27 32.13 16,315.20 4,915.12 67.81 21.73 199.42

2 IBRD 14,589.68 21.78 8,812.45 5,534.09 44.73 109.97 88.44

3 IFAD 280.48 0.42 240.46 24.72 - - 15.30

4 OPEC 245.53 0.37 182.03 61.99 0.00 - 1.51

5 NDF 16.93 0.03 12.82 1.90 - - 2.21

Other

Charges

0.00 - less than five thousand

(Table XXI, continued)

Particulars


Total % to


Commit-

ment Fee

Guaranty

Fee


GRAND TOTAL 66,972.32 100.00 48,482.76 16,203.50 230.17 644.21 1,411.69

56,666.67 84.612 40,976.65 14,097.51 194.98 - 1,397.52

100.00 72.31

NG-Direct 55,073.16 82.23 39,563.54 13,982.44 194.98 - 1,332.20

1 DOF 22,556.73 33.68 15,865.14 6,369.67 - 321.92

2 DPWH 9,341.31 13.95 7,059.91 1,843.92 27.65 409.83

3 DepEd 3,858.18 5.76 2,805.61 998.82 9.78 43.96

4 DAR 2,892.16 4.32 2,233.94 537.56 5.45 115.21

5 DSWD 2,508.01 3.74 778.54 1,644.18 72.54 12.75

6 DOTr 2,467.47 3.68 1,857.15 453.13 29.58 127.62

7 DA 1,832.84 2.74 1,471.98 345.33 - 15.52

8 NIA 1,490.83 2.23 1,070.71 374.23 2.26 43.64

9 DOE 1,476.97 2.21 1,255.32 150.06 4.78 66.82

10 SC 1,390.31 2.08 1,207.96 176.90 - 5.46

11 DOH 1,290.33 1.93 1,040.20 213.31 2.20 34.61

12 DENR 766.33 1.14 612.59 133.77 10.88 9.09

13 BOC 719.32 1.07 572.78 119.43 - 27.12

14 DILG 678.95 1.01 424.47 197.80 9.27 47.41

15 NPC 551.12 0.82 383.95 160.71 4.47 1.99

16 ARMM 318.16 0.48 227.13 86.29 - 4.74

17 PRRC 257.13 0.38 212.82 37.33 - 6.98

18 TESDA 211.59 0.32 158.65 41.27 - 11.68

Table XXII - Debt Service Expenditures by Implementing Agencies

Particulars


Total % to


Commit-

ment Fee

Guaranty

Fee

Other

Charges

Paid by BTr

% to Total 27.69

27


Of the total debt service expenditures for the year, 36.42 percent were payments for loans availed by the Infrastructure sector, as presented in Table XXIII.

19 BFAR 135.17 0.20 116.71 14.15 - - 4.32

20 PG-LDN 76.05 0.11 57.31 14.92 - 3.81

21 BIR 63.34 0.09 27.82 35.12 - 0.40

22 BFP 57.97 0.09 38.12 6.14 1.60 12.11

23 DOT 34.21 0.05 27.14 5.26 - 1.81

24 OCD 26.29 0.04 - 11.75 14.54 0.00

25 LLDA 25.29 0.04 17.98 7.07 - 0.25

26 UP 17.52 0.03 16.46 0.80 - 0.27

27 PMMA 17.17 0.03 12.81 2.74 - 1.62

28 OP 12.41 0.02 10.37 0.77 - 1.27

NG-Relent 1,593.51 2.38 1,413.11 115.07 - - 65.33

1 LRTA 1,213.07 1.81 1,061.49 96.64 - - 54.93

2 LBP 201.39 0.30 188.17 8.99 - - 4.23

3 PHIVIDEC 119.36 0.18 114.70 - - 4.66

4 SBGFC 34.45 0.05 27.97 6.02 - - 0.47

5 NFA 15.71 0.02 11.46 3.34 - - 0.92

6 MWSS 9.53 0.01 9.32 0.08 - - 0.13

10,305.65 15.388 7,506.11 2,105.99 35.18 644.21 14.16

NG-Guaranteed 10,305.65 15.39 7,506.11 2,105.99 35.18 644.21 14.16

1 LBP 2,483.61 3.71 1,890.84 359.15 0.53 230.64 2.45

2 DBP 2,232.79 3.33 1,662.37 564.94 5.26 - 0.23

3 BCDA 1,271.49 1.90 860.35 199.80 - 209.74 1.59

4 MWSS 1,061.99 1.59 741.23 252.33 - 66.31 2.12

5 NFA 1,048.28 1.57 723.00 323.18 - - 2.10

6 LRTA 621.36 0.93 469.14 109.70 - 42.52 0.00

7 PPA 418.64 0.63 300.02 81.25 - 37.37 0.00

8 SBMA 418.29 0.62 308.08 55.34 - 54.86 -

9 LWUA 301.93 0.45 245.22 56.00 0.71 - 0.00

10 PNR 205.70 0.31 153.19 46.85 - - 5.67

11 PEZA 201.88 0.30 122.15 51.04 28.69 - -

12 PTA

(TIEZA)

39.70 0.06 30.53 6.41 - 2.76

(Table XXII, continued)

Particulars


Total % to


Commit-

ment Fee

Guaranty

Fee

Other

Charges

Paid by GOCCs

0.00 - less than five thousand


1 Infra. 24,389.74 36.42 18,493.26 4,466.42 72.75 562.16 795.15

2 SRCD 14,988.98 22.38 7,948.84 6,775.75 108.33 - 156.07

3 GID 13,716.33 20.48 11,074.12 2,372.47 1.60 - 268.14

4 AARNR 9,593.33 14.32 7,292.11 2,070.64 47.27 21.55 161.75

5 ITT 4,283.94 6.40 3,674.43 518.23 0.22 60.51 30.56

Total 66,972.32 100.00 48,482.76 16,203.50 230.17 644.21 1,411.69

72.39 24.19 0.34 0.96 2.11% to Total


Table XXIII - Debt Service Expenditures by Project Sector

Particulars


Total % to


Commit-

ment Fee

Guaranty

Fee

Other

Charges

28

3.6 Outstanding Balance – P918.83 billion (US$18.39 billion)

As of December 31, 2017, ODA loans have outstanding balance of P918.83 billion (US$18.39 billion) which increased by P48.56 billion (US$0.91 billion) compared with last year’s balance of P870.27 billion (US$17.49 billion). The increase was due to adjustments, revaluation of foreign currency and availments and repayments during the year. The details are shown in Table XXIV.

3.6.1 By Type of Creditor

As to type of creditor, balances from Multilateral creditors represents 58 percent of the total balances. The outstanding balances to lenders by type of creditors are presented in Chart VIII.

Chart VIII – Outstanding Balances by Creditor Type (in billion PhP)

The specific creditors by type are presented in Table XXV.

US$ PHP

17.49 870.27 94.72

Adjustments 0.03 1.40 0.15

Forex Revaluation 0.43 24.99 2.72

CY Availments and Repayments 0.44 22.17 2.41

18.39 918.83 100.00

0.91 48.56 5.58

Balance as of December 31, 2017

Increase

Table XXIV - Changes on Loan Outstanding Balance

Particulars Amount (in billion) % to

Total

Balance as of December 31, 2016

Add/(deduct):

PhP531.08 (58%)

PhP364.84 (40%)

PhP22.90 (2%)

Multilateral Bilateral Commercial

US$ PHP

1 Multilateral 10.63 531.08 0.58

2 Bilateral 7.30 364.84 0.40

3 Commercial 0.46 22.90 0.02

18.39 918.83 100.00 Total

Creditor Type

Outstanding

Balances % to

Total

US$ PHP

18,392.00 918,827.62 100.00

7,302.99 364,842.77 39.71

1 JICA 6,201.82 309,830.42 33.72

2 AFD 341.68 17,069.65 1.86

3 KEXIM 212.48 10,614.97 1.16

4 BNP PARIBAS 180.60 9,022.39 0.98

5 KFW 135.06 6,747.08 0.73

6 USPL 100.07 4,999.46 0.54

7 ICO 67.80 3,387.02 0.37

8 FP 24.98 1,248.19 0.14

9 ECGD 9.36 467.81 0.05

Total

Bilateral

Table XXV - Outstanding Balances by Specific Creditor (in million)

Creditor Amount

% to Total

29


The Project Sector with the highest outstanding balances is the Social Reform and Community Development (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

US$ PHP

10 Artigiancassa 7.95 397.34 0.04

11 Belgian 6.69 333.97 0.04

12 SOCIETE GEN 5.84 291.65 0.03

13 KBC 5.48 273.61 0.03

14 JFA 1.93 96.37 0.01

15 KFAED 1.26 62.84 0.01

Multilateral 10,630.61 531,084.10 57.80

1 ADB 5,439.40 271,741.58 29.57

2 IBRD 5,048.26 252,201.06 27.45

3 IFAD 97.57 4,874.51 0.53

4 OPEC 34.04 1,700.62 0.19

5 NDF 11.34 566.34

Commercial 458.40 22,900.75 2.49

1 CEXIM 278.88 13,932.24 1.52

2 BAC 115.32 5,761.37 0.63

3 RZOA 19.67 982.81 0.11

4 ICO 18.95 946.55 0.10

5 ERSTE 13.70 684.25 0.07

6 Bancaja 4.62 230.76 0.03

7 BNP PARIBAS 3.52 175.84 0.02

8 FP 3.08 153.65 0.02

9 NDF 0.67 33.27 0.00


(Table XXIV, continued)

Creditor Amount

% to Total

30

(Chart IX, continued)


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

2016 2017 2016 2017

AARNR 78 76 96.59 99.76

GID 19 20 112.50 105.32

ITT 18 18 37.84 35.63

Infra. 148 150 269.07 280.09

SRCD 65 66 354.27 398.03

Total 328 330 870.27 918.83

Project SectorNo. of loans Outstanding Balance (in billion PhP)

US$ PHP

18,392.00 918,827.62 100.00

5,606.58 280,093.43 30.48

1 PH-P226 Subic-Clark-Tarlac Expressw ay

ProjectBCDA JBIC 407.52 20,359.12 2.22

2 PH-P243 Environmental Development Project DBP JBIC 221.05 11,043.01 1.20

3 2282 PHI Pow er Sector Development

Program ClusterDOF ADB 210.74 10,527.90 1.15

4 PH-P247 Toad Upgrading and Preservation JBIC 200.64 10,023.67 1.09

5 7552 PH National Roads Improvement and

Management Project 2IBRD 186.44 9,314.04 1.01

2,108.09 105,316.01 11.46

1 2840-PHI Governance in Justice Sector

Reform Program- Subprogram 2DOF ADB 254.15 12,696.65 1.38

2 7913-PH

Food Crisis Response Development

Policy Operation: Supplemental

Support for Post-typhoon Recovery

DepEd IBRD 250.00 12,489.50 1.36

3 2489 PHI Governance in Justice Sector

Reform ProgramSC ADB 192.70 9,626.82 1.05

4 2450 PHI Development Policy Support

Program Cluster-Sub Program 2DOF ADB 189.59 9,471.57 1.03

5 7424 PH First Development Policy Loan

ProgramDOF IBRD 187.45 9,364.63 1.02

1,996.79 99,755.74 10.86

1 PH-CL 020MM Air Quality Improvement Sector

Development ProgramJBIC 227.94 11,387.54 1.24

2 7615 PH Food Crisis Response Development

Policy200.00 9,991.60 1.09

3 8421-PH Phillippine Rural Development

ProjectDA 171.74 8,579.76 0.93

4 PH-P199 Environmental Infrastructure

Support Credit Program, Phase IIDBP 131.91 6,589.82 0.72

5 PH-P242 Agrarian Reform Infrastructure

Support Project, Phase IIIDAR 101.46 5,068.87 0.55

7,967.30 398,030.61 43.32

1 3080-PHI

Emergency Assistance for Relief

and Recovery from Typhoon

Yolanda

DOF ADB 500.00 24,979.00 2.72

Social Reform & Community Development

DOF

IBRD

JBIC

Total Outstanding Balance

Infrastructure

Governance and Institution Development

Agriculture, Agrarian Reform and Natural Resources

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

Loan Account

No.Name of Project IA Creditor

Amount % to

Total

DPWH

31

3.6.3 By Government Sector

The loan balances by government sector with the NGAs having the highest outstanding balance representing 82.67 percent of the total loan balances are shown in Table XXVII.


Table XXVIII shows the loan balances by implementing agency with the DOF and DPWH having the highest outstanding balances representing 39.10 percent and 12.48 percent of total loan balances.

US$ PHP

2 8085-PH Disaster Risk Management and

DevelopmentDOF 500.00 24,979.00 2.72

3 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 24,979.00 2.72

4 PH-SB1 Post Disaster Stand- by Loan DOF JBIC 445.40 22,251.29 2.42

5 7805-PH Social Welfare and Development

Reform ProjectDSWD IBRD 405.00 20,232.99 2.20

713.24 35,631.82 3.88

1 PH-P198 Industrial Support Services

Expansion Program, Phase IIDBP JBIC 226.56 11,318.60 1.23

2 2278 PHI Financial Market Regulation &

Intermediation Program ClusterDOF ADB 93.66 4,679.07 0.51

3 PH-P189 Domestic Shipping Modernization

Program, Phase IIDBP JBIC 93.21 4,656.36 0.51

4 2199 PHI Microfinance Development Program DOF ADB 61.10 3,052.18 0.33

5 4833 PH Support for Strategic Local

Development & Investment ProjectLBP IBRD 43.56 2,176.41 0.24

(Table XXVI, continued)

Loan Account

No.Name of Project IA Creditor

Amount % to

Total

Industry, Trade and Tourism

IBRD

NG Direct NG- RelentNG

GuaranteedTotal US$ PHP

16 9 50 75 3,112.58 155,498.11 16.92

5 5 74.49 3,721.52 0.41

250 250 15,204.93 759,607.99 82.67

271 9 50 330 18,392.00 918,827.62 100.00

PhP 780,673.35 21,138.52 117,015.74 918,827.62

US$ 15,626.59 423.13 2,342.28 18,392.00


Table XXVII - Outstanding Balances by Government Sector

Implementing

Agency

Amount

(in million) % to

Total

GOCCs

LGUs

NGAs

Total

Amount

(in million)

No. of Loans

32

US$ PHP

330 18,392.00 918,827.62 100.00

250 15,204.93 759,607.99 82.67

1 DOF 37 7,191.84 359,290.11 39.10

2 DPWH 69 2,294.46 114,626.51 12.48

3 DSWD 9 1,993.75 99,603.53 10.84

4 DepEd 12 886.86 44,305.96 4.82

5 DOTr 25 603.37 30,143.06 3.28

6 DAR 18 512.15 25,585.97 2.78

7 DA 22 443.95 22,178.88 2.41

8 DILG 7 309.95 15,484.57 1.69

9 SC 2 202.37 10,109.76 1.10

10 DOH 12 153.11 7,649.29 0.83

11 DOE 3 127.52 6,370.53 0.69

12 DENR 11 116.38 5,814.07 0.63

13 BOC 2 108.73 5,432.17 0.59

14 OCD 1 60.31 3,012.97 0.33

15 BFP 2 47.32 2,364.02 0.26

16 PRRC 2 44.08 2,202.34 0.24

17 TESDA 5 38.78 1,937.51 0.21

18 BFAR 5 36.10 1,803.63 0.20

19 DOT 1 13.42 670.55 0.07

20 PMMA 1 7.28 363.48 0.04

21 BIR 1 5.03 251.10 0.03

22 UP 1 4.96 247.81 0.03

23 OP 2 3.21 160.17 0.02

GOCCs 75 3,112.58 155,498.11 16.92

1 DBP 17 957.98 47,858.52 5.21

2 LBP 13 492.57 24,607.67 2.68

3 LRTA 6 409.79 20,472.42 2.23

4 BCDA 1 407.52 20,359.12 2.22

5 NIA 12 328.59 16,415.77 1.79

6 MWSS 3 132.86 6,637.62 0.72

7 SBMA 2 108.56 5,423.37 0.59

8 PPA 2 71.81 3,587.45 0.39

9 PHIVIDEC 1 54.31 2,713.34 0.30

10 LWUA 6 52.84 2,639.57 0.29

11 SBGFC 3 38.69 1,932.64 0.21

12 PNR 2 29.65 1,481.37 0.16

13 NPC 2 13.94 696.46 0.08

14 PTA (TIEZA) 1 4.69 234.53 0.03

15 LLDA 2 4.64 231.62 0.03

16 PEZA 1 2.21 110.27 0.01

17 NFA 1 1.93 96.37 0.01

LGUs 5 74.49 3,721.52 0.41

1 ARMM 4 59.42 2,968.59 0.32

2 PG-LDN 1 15.07 752.93 0.08

Table XXVIII - Outstanding Balances by IA (in million)

Total Oustanding Balance

NGAs

No. of

Loans Creditor % to Total

Outstanding Balances


4.0 AUDIT OBSERVATIONS

AND

RECOMMENDATIONS

33

4.0 AUDIT OBSERVATIONS AND RECOMMENDATIONS

4.1 Consolidated Audit Observations and Recommendations

Audit Observations Recommendations

A. Project Sustainability

Sustainability of completed projects was not assured. Existing conditions of at least 17 projects with loan availments of P23.31 billion and existing loan balances of P13.98 billion would manifest inability of the implementing agencies/recipients to sustain the gain from the projects.

Based on the records provided by the BTr, 459 loan agreements were entered into from 1995 to 2017, of which 392 loans were closed from 1996 to 2017. The closed/ terminated loans were used to implement 63 programs and 288 projects, of which, only 275 were declared completed. Of the 392 loans, 284 have remaining loan balances ranging from P4.28 million to P24.98 billion.

The concerned Auditors tried to determine from the monitoring reports or any available documents of the implementing agencies (IAs), the status/condition of these projects to establish whether the concerned IAs/recipients were able to sustain the projects established upon completion. Evaluation of documents submitted by the concerned Agency officials disclosed that of the 275 completed projects as of December 31, 2017, only the status of 105 projects were so far established as reflected in Table XXIX.

The status/condition of 170 projects cannot be established due to, among others, the following:

a) Inavailability of records and information considering that

employees who implemented the projects were no longer connected with the IA or recipient agency.

Management to require concerned officials to: a) Assess LIGs since more than

one-year business cycle has elapsed instead of just waiting for the completion payment of the Livelihood Assistance Fund (LAF); Issue termination notice to the LIGs as provided in the MOA in case of business operation failure; and retrieve the funds from Community Financial Institution (CFI) for terminated LIGs. (DA/ SCHARMP)

b) LGUs and other beneficiary associations, to include in their budget, funds for the maintenance of the transferred projects; and establish the obligations of each party in the MOA to sustain the projects. (various projects)

c) Implementing Agencies to include sustainability plan in the general plan of the project; to closely monitor the utilization of projects transferred to the recipient LGUs/associations; and to require them to submit Status Report showing the condition of the transferred project as well as problems, issues and concerns in the utilization of the turned-over project and act accordingly to sustain the project. (various projects)

d) Implementing agencies to

assess the capability of the recipient agency to sustain

AvailmentsOutstanding

Balance

88 216,201.20 99,068.41

10 19,483.60 12,188.64

7 3,828.66 1,793.55

170 411,016.80 182,212.67

275 650,530.26 295,263.27

Table XXIX - Operational Status of Completed Projects

Amount

(in million PHP)No. of

PojectsStatus

Operational

Partially Operational

Not Operational

No Status Reported

Total

34


b) Absence of monitoring by the IA of the status of completed projects.

As reported by the concerned Audit Teams, the status/condition of projects which were not sustained or fully sustained follows:

IA Project Amount

(Million P) Loan

Balances

Remarks

DA

SCHARMP

2.422 1,130.56 Various Livelihood Interest Groups (LIGs) have outstanding balances beyond the one-year business cycle due to poor business management, contrary to the MOA signed by the parties.

CHARMP Not Indicated

240.16 Out of 84 projects inspected, only 37 were maintained by the Local Government Units (LGUs) and 23 others rehabilitated; Seven other projects were damaged while 17 others were partly damaged. (DA CAR)

Most beneficiary POs who were expected to care, maintain and support the established plantation were already desolved. (DA/CAR)

DFIMDP 3.320 673.78 Of the 13 food terminals established in the different barangays in the Provinces of Cavite, Rizal and Laguna, out of funds transferred by DA to the LGUs and barangays as of December 31, 2009, only two remains operational. (DA RFO IV-A)

NPC PRES

0 696.46 Mini Grid System Component - Notwithstanding the high production cost and low collection efficiency from customers, NPC maintained the operation of 128 out of the 154 installed generator sets with the support from the MESP. The Solar Photovoltaic (PV) Systems - Out of the total 5,129 solar panel units installed, only owners of 307 units were able to replace battery to make them operational, 4,102 units are with discharged batteries; 5 units were reported accidentally burned; 4 units were reported stolen, and 801 units were reported defective. There were no reported collections from the Solar Home Systems (SHS) for CY 2017.

DOE PEEP 75.335 1,129.59

DOE failed to operationalize the Lamp Waste Management Facility (LWMF), one of the components of the project.

LRTA AFC 83.11 Replaced by new Automatic Fare Collection System or Beep Cards.

DILG ENP 843.17 Of the 16 units of ENP equipment, only one was operational with limited functions. It can only serve calls but unable to do recording. All other units were not serviceable due to obsolescence, gutted by fire or damaged by typhoon.

the project, otherwise transfer the project to an LGU committed to comply with the requirements, and worthy to be a project beneficiary. (various projects)

e) NPC to reassess the requirements and prospects of bringing power generation and the associated power delivery systems to commercial viability and lower production costs by coordinating with Masbate Electric Cooperative (MASELCO) for a possible Qualified Third Party (QTP) take over thru the Missionary Electrification Subsidy Program (MESP); Devise more efficient collection strategies/mechanism to improve collection efficiency of power receivables; Conduct physical inventory taking of defective SHS and prepare an assessment report on whether the continuance of the SHS component of the project would yield a more advantageous result; and Address the identified operational and mobilization issues. (NPC/PRES)

f) Negotiate with the identified LGUs/private organizations to operate the LWMF in order to serve its purpose; Provide the Audit Team with the updates/information on the results of the negotiation with the LGUs or other government and private organizations; and Provide justification as to why this transaction may not be disallowed in audit. (DOE/PEEP)

35


IA Project Amount

(Million P) Loan

Balances Remarks

DOTr GMDSSP 157.93 Abandoned by the contractor in CY 2000 due to non-payment of advance payment for variation order and extra management cost.

MSIP-3 461.53 No information in CY2017 report. Based on CY 2008 CAAR, project equipment were unserviceable/unutilized.

UP- PGH

UME- DEMS

247.81 In CY 2016, equipment costing 243.31 million were declared unserviceable due to wear and tear per Report of the Property and Supply Division.

DILG CAMDP 32.89 In CY 2016, the Buldozer, dump truck and five equipment under Solid Waste Management were reported unserviceable.

RWSSSP- 5

135.80 In CY 2016, some units were reported unserviceable due to: a. No water source; b. Not potable for daily use; c. With traces of lead; and d. Parts or facility are heavily damaged

which become irrepairable.

MBUSSP 6.38 788.50 Of the 39 subprojects, only status of 28 projects were reported, of which 27 are still serviceable. Lugait equipment with projects cost of P6.38 million was reported unserviceable.

PRRC PREMRP 1,928.72 Of the 59 components, 16 were not operational

BOC NICIS 5,432.17 One unit located at Port of Davao with pending case (BOC vs. Acquarius Container Yard), with status quo order from the court.

B. Project Implementation and Management

1. Completion of 17 projects within the loan period is

unlikely considering the reported project status. The benefits then to be derived therefrom will be delayed in addition to payments of commitment fees. Based on BTr report, out of the total debt service for CY 2017 alone, P230.17 million represents payment of commitment fees for delayed withdrawal/availment of loans.

Considering the status of implementation of 17 projects as reported by the concerned Auditor Teams, the timely completion of these projects is unlikely. The projects affected and their conditions follow:

IA Project Amount

(Million P) Remarks

DA PRDP Not Indicated

The project’s overall physical progress of 59 percent is not commensurate

Management to require concerned officials to: a) Formulate realistic and

attainable work plan and budget by: i) Preparing Monthly Disbursement Program (MDP) and ensuring that it matched with the budgetary and disbursement requirements; ii) Ensuring that programs, projects and activities are ready for implementation upon the release of allocated funds; and iii) Installing budget performance tracking and

36


IA Project Amount

(Million P) Remarks

DA PRDP with the actual disbursement status of 32 percent as of December 31, 2017 indicating very low fund utilization for the past three years of project implementation.

4,747.00 Out of P4.747 billion allotment received for CY 2017, only 15 percent or P716.861 million has been disbursed as of December 31, 2017. Unobligated balance of FY 2017 GAA amounted to P546.066 million or 26 percent.

316.832 Cash allocation of P316.832 million or 39 percent of the total allocation of P818.721 million received by NPCO, PSO Luzon B and RPCO IVB in CY 2017 was not utilized.

19,869.00 Of the 389 total subprojects in CYs 2014-2021 under the I-Build Project Component with aggregate project cost of P19.869 billion, 152 subprojects costing P6.637 billion were targeted for completion as of December 31, 2017. Of the targeted projects, only 67 subprojects costing P1.929 billion were completed leaving 85 subprojects costing P4.708 billion either ongoing, for implementation or cancelled/ terminated. Forty five of the uncompleted subprojects costing P1.653 billion are already beyond target date of completion.

1,899.00 Proposals for I-REAP subprojects remained low in the span of three years generating only 599 subproject proposals costing P1.899 billion or 47 percent out of the total cost allocation of P4.003 billion targeted to be implemented over the six-year project duration. Moreover, the required midterm assessment report was not yet submitted due to the delayed engagement of the third-party expert. Also, the 599 subproject proposals cover only 73 PLGUs out of the 81 PLGUs nationwide.

306.832 Of the 566 total subprojects to be implemented for CYs 2016-2019 under the I-REAP Project Component

similar system to monitor utilization of allotments to prevent lapsing of cash allocations and loan drawdowns. (DA/PRDP; DOTr/CEMTSMMP)

b) Fast track disbursement process to settle possible due and demandable obligations to fully utilize available NCA balances. (DA/PRDP)

c) Review operations to determine bottlenecks and/or reasons for low utilization of funds and act accordingly; Fast track resolution of issues, implementation of planned programs, projects and activities to avoid lapsing of cash allocation; Submit a catch up plan for the NCA received; and Accomplish MRDs or FAR No. 4 properly and completely in compliance with Appendix 23, GAM, Volume II. (DOTR/PPADP, NBAC-SEPP, New CNS/ATM, CEMTS-MMP, MSCIP Phase I, MSCIP, Phase II Cebu BRT & PCGCDP; DA/PRDP)

d) Provide COA with the list of WFP not obligated, reasons for non-obligation, documentary requirements of subprojects with extended contract time to evaluate validity thereof pursuant to the provisions of RA 9184 IRR, status of cancelled/ terminated subprojects and those with 10 percent and above negative slippages, and approval of any fund realignment. (DA/PRDP)

e) Revisit subproject profile of participating LGUs and prioritize proposals for PWS considering the additional

37


IA Project Amount

(Million P) Remarks

DA PRDP P439.092 million were targeted for completion as of December 31, 2017. Of the targeted projects, only 132 subprojects costing P132.260 million were completed leaving 210 subprojects costing P306.832 million still ongoing, or for implementation.

Not Indicated

Approved subprojects for communal irrigation system (CIS) and potable water system (PWS) remained substantially low at 6 and 32 percent, respectively, hence not corresponding with the targets specified in the Project Appraisal Document (PAD).

330.026 The accomplishments/work progress of the Construction of FMR subprojects in PLGU Camarines Sur, MLGUs Esperanza, Masbate and Sison, Surigao del Norte were notably sluggish contrary to the goals and objectives of PRDP, thus delaying the delivery of much needed roads.

305.066 Improvements of farm-to-market roads in Mountain Province, CAR are behind schedule.

3.291 The Mountain Province Arabica Coffee Enterprise project under (I-REAP) component has not yet been started despite availability of funds intended for the project.

1.536 Fund transfers from DA-CAR for the Philippine Rural Development Project remained unutilized contrary to provisions of the Memorandum of Agreement. (Municipality of Banko, CAR)

2.702 The procurement of various equipment for implementation of I-REAP subproject in PLGU Albay, was delayed by an average of 314 days from the time the purchase requests were issued until the receipt of the NOL2, thereby delaying its implementation. Moreover, MLGU Burgos, Ilocos Sur failed to immediately issue to the end-user the purchased farm tractor amounting to P0.950 million depriving the intended

financing under the I-Build Component; Submit the duly approved subproject profile eligible for expenditure of prioritized proponent LGU; and establish basis for evaluation and approval of proposal for other infrastructure subprojects. (DA/PRDP)

f) Direct the contractors to fast-track the completion of the projects, considering that these should have already been completed as of report date; and monitor regularly the status of implementation of the projects. (DA/PRDP)

g) Impose liquidated damages for the delay in project completion and take legal action as applicable; Demand from contractors repair of damaged portions of the projects; and consider providing sanctions for LGUs in case of non-compliance with terms and conditions in the scale-up of projects. (DA/PRDP/SCHARMP)

h) Address any project viability/ location sites, civil works or right of way issues during the planning or preliminary stage of procurement, prior to bidding and project implementation, to avoid delays and incurrence of additional cost. (DA/PRDP/ SCHARMP; NIA/JRMPII)

i) Ensure that the additional financing/fund realignment to cover the pipelined SPs is in line with the PRDP results framework as prescribed in the PAD; Submit disposition for the unfunded SP proposals amounting to P15.269 billion considering

38


IA Project Amount

(Million P) Remarks

DA PRDP user of the early use of the same.

Not Indicated

Additional expenses for materials and other inputs needed for the implementation of the projects were incurred using the contributed equity of the PG-CSOs. (PLGU Iloilo)

9,168.00 The remaining unprogrammed fund including the additional financing is still insufficient to cover the (a) pipelined sub-projects (SPs) pending approval costing P24.437 billion; and (b) projected number of PLGUs to engage as provided in the Project Appraisal Document (PAD).

SCHARMP 24.137 Three infrastructure subprojects were not fully implemented with unfinished portions costing P1.907 million as of December 31, 2017, as of closing date of the project, thereby, depriving the public of the services and benefits that could have been derived from the project.

Recon-struction of DA/ NAFC LDC Bldg.

16.322 Cash allocation of P16.322 million or 74 percent of the total allocation of P21.946 million received in CY 2017 for the construction of the new building was not utilized by Management.

NRIMPPII 0.023 The lapses in the procurement, delivery and distribution of Universal Testing Machines prolonged the attainment of the Agency’s objective of upgrading the capacity for material testing in Sub-Regional Laboratories and deprived the intended recipients of the immediate benefits that could be derived therefrom, as well as, incurrence of unnecessary expenses.

DOTr (7 Projects)

PPADP NBAC- SEPP New CNS/ ATM CEMTSMMP

MSCIP Phase I/II Cebu BRT &

PCGCDP

19.899 Of the total allotments received inclusive of continuing appropriations, the amount of P15.400 billion or 77.39 percent was obligated, leaving an unobligated allotment of P4.499 billion or 22.61 percent as of 31 December 2017. On the other hand, of the total cash allocations received of P4.549 million, only P2.358 billion was utilized, resulting in the reversion of P2.192 billion or 48.18 percent to the BTr.

the depleted fund for I-Build Component to ensure that these can still be implemented. Resolve the insufficient funding requirement for the remaining 14 PLGUs with pending SP proposal. (DA/PRDP)

j) Direct the LCE of MLGU Esperanza, Masbate to prioritize and take appropriate action in the implementation of Charcoal Briquette Production Enterprise to warrant timely delivery of the benefit therefrom. (DA/PRDP)

k) Require the LGUs to complete the projects immediately or return the unliquidated amounts to the SCHARMP and allocate funds for its operation and maintenance as required under the MOA; Resolve the problem on right of way for the installation of pipes; and Demand from the contractor repair of the damaged portions of the projects; (DA/SCHARMP)

l) Submit to COA, copy of the contract on the Procurement of New Rolling Stock LRV (4th Generation) and justifications/ causes of delay or negative slippages of the CEMTSMMP components and courses of actions taken to address delays; Prepare a revised Detailed Time Schedule and a catch-up/work plan to attain the target completion dates indicated in the contracts; Require all stakeholders to avoid/minimize delays in the procurement process and implementation of the project. (DOTr/CEMTSMMP)

39


IA Project Amount

(Million P) Remarks

CEMTSMMP 10,562.00 Despite availability of the loan facility amounting to ¥43.252 billion, financed by JICA to fund the Construction of the LRT Line 1 South (Cavite) Extension and LRT Line 2 East (Masinag) Extension Projects, implementation was delayed due to slow procurement process. The delay in project implementation also resulted in low utilization/availment of loan proceeds, hence, the accumulation of Commitment Fees for CYs 2013-2017.

DENR INREMP Not Indicated

DENR CAR has no disbursement for INREMP-LP and registered low disbursement rate of 66.67 percent for INREMP-GOP due to the delayed implementation of the project.

DOH EU-HSPSP II

415.000 Non-achievement of three targeted performance indicators required for the release of the variable tranche resulted in non-availment of €3.9 million grant; and Slow or delayed implementation of civil works/infrastructure resulted in unutilized grant amounting to P415 million.

NIA

JRMPP II

1,103.000 Completion of the project within the five (5) year period of November 28, 2012 to November 28, 2017 and extended project completion of September 2021 was affected by the following:

Delays in implementation resulted in deferment of provision of year-round irrigation to 31,840 hectares of farm lots in the Province of Iloilo. This is despite incurrence of cumulative expenses as of December 31, 2017.

Delay in procurement of Consultancy Services for the Detailed and Construction Supervision, and the Writ of Kalikasan.

As at year-end, the Engineering Department reported under its Status

m) Effectively plan and monitor the project accomplishment so that timely decisions can be undertaken, such as submission of requests in case of realignments, and follow-ups for the issuance of No Objection Letter (NOL) and Clearance from DBM for timely settlement of obligations. (DENR/INREMP)

n) Strengthen selections of targeted performance indicators to come up with a more attainable performance indicators that are within the control of the DOH; Include end-users during the selection and procurement planning of all civil works/infrastructure projects to minimize, if not totally avoid, changes delaying project implementation; and Monitor and strengthen coordination with IAs to ensure timely project completion. Also incorporate lessons learned from completed projects to avoid incurrence of the same project deficiencies in the future. (DOH/EU-HSPSP II)

o) Direct project engineers to ensure that plans and program of works are as accurate as possible to minimize variations; and Act with dispatch in resolving the existing issues/problems that are currently hampering/ delaying the completion of the projects. (NIA-JRMMPII)

p) ACT/RPMO personnel to: Closely monitor, supervise and provide technical assistance to the BSPMC during project

40


IA Project Amount

(Million P) Remarks

NIA

JRMPP II

Report an Overall Physical Weighted Accomplishment of only 13.56 percent despite availability of funds and personnel.

DSWD (2 Projects)

KC- NCDDP ADB & WB

Not Indicated

The project registered a physical accomplishment of 81.32 percent as of December 31, 2017, slightly below the 85 percent KC-NCDDP Results Framework for CY 2017 requirement per loan agreement, thus, falling short of its objective of providing selected community of improved access to services and infrastructure and to participate in more inclusive management planning, budgeting and implementation.

4,804.86 The lapses in monitoring and reporting by NPMO and Regional PMO resulted in low percentage of implementation/ downloading of community grants of 62.58 percent as against the 82.65 percent target per KC-NCDDP Operations Manual; and huge unutilized amount which remained in the bank as of December 31, 2017, thus depriving the community of the immediate benefits due them.

KALAHI- CIDSS Sub- Projects/ GPPB/BUB

Ineffective asset management of KALAHI-CIDSS Projects in subprojects such as in adequately maintained or damage projects, no longer fully functional, inactive and unregistered/ unaccredited associations for completed Income-Generating Projects.

BFAR Fish Coral

8.277 Cash allocation of 14.71 percent of the NCA of P56.257 million received as of December 31, 2017 was not utilized by management due to various constraints resulting in the reversion thereof and delay in the implementation of various activities.

implementation and immediately correct the defects/deficiencies noted for the full continuity and functionality of the SPs; Conduct regular coordination with other infrastructure government agencies to avoid overlapping of projects to the extent that completed KC projects are inadvertently removed to make way for other agency’s (e.g. DPWH) infra projects; Provide storage facilities before the delivery of the construction materials at the site for security; Institute necessary action against the RPMO/ACT/ BSPMC who were remiss in monitoring and evaluation of the SPs; and Ensure all work items necessary to make the project functional/operational are properly identified in the planning stage particularly in the preparation of the Program of Works. (DSWD-KC-NCDDP-ADB & WB)

q) NPMO/RPMO to:

Systematize downloading of funds and ensure that the available proceeds are implemented in accordance with approved budget, project milestones, and performance expectations; and Prepare monthly monitoring reports as feedback mechanism to ensure that project deficiencies and problems encountered are appropriately and immediately addressed by concerned officials. (DSWD/KC-NCDDP-ADB & WB)

r) DSWD RPMO of KALAHI- CIDDS to: Make representations with LGUs to monitor/revisit the different

41


projects implemented in the different municipalities and barangays; Continue the Sustainability Evaluation Test to ascertain the functionalities of the different subprojects; Require the contractor to immediately correct the defects/deficiencies noted for the full functionality of the SPs for the benefits of the intended beneficiaries in accordance with Section 12.5 of the Special Conditions of the Contract which provides for a warranty period of 15 years; to assess their status and functionality, in order to address the problems on a timely manner and avoid wastage of government funds. (DSWD/KALAHI-CIDSS: KKB or GPPB Project)

s) Ensure that programs, projects and activities are ready for implementation upon the release of the allocated funds; and Install budget performance tracking system to monitor the utilization of allotments in order to prevent the lapsing of cash allocations; (BFAR/Fish Coral)

2. Implementation of various projects was affected by either delayed/non-submission/inability of recipients to meet documentary requirements, or deficiencies in the contract and its implementation, delayed procurement process, or non-compliance with RA No. 9184 or contract covenants, among others, which may adversely affect completion of projects on time and/or effective utilization of completed projects. Further evaluation by the concerned audit team disclosed that the implementation of various projects are affected by the following conditions:

Management to require the

concerned officials to:

a) Closely coordinate with the

NEDA-ICC and the French

Government for the approval

and concurrence of the

amended Terms of Reference

to facilitate the awarding of the

contract to the winning

contractor and the registration

to the Financial Protocol to

avoid further delays in the

42


IA Project Amount

(Million P) Remarks

BFAR PHILO Project Phase 2

Not Indicated

The implementation of the project was not yet started after almost two years since the approval of the Loan Agreement in CY 2016 due to delayed procurement process which caused the non-registration of approved contracts to the Financial Protocol between the two contracting governments.

DA PRDP Non-preparation/revision of SP components and procurement plan/Work and Financial Plan (MLGU Placer, Masbate and PLGU Iloilo)

PRDP NPCO, PSOs

2,125.00 Various issues in the IMA entered into by the PSO Luzon B and proponent LGUs for the implementation of I-Build Component subprojects consisting of the following: a. Stipulations in the IMA as well as

its supporting documents were deficient/not submitted or not compliant with the I-Build Manual, GAA and IMA;

b. Schedules of releases of fund

inconsistent with the provisions in the I-Build Manual;

c. Signatories in the ORs, are non-

compliant with the DA General Memorandum Order on the delegated authority;

d. Incomplete documentary

requirements to support the fund transfer to the proponent LGU; and

e. Contract Cost in excess of

Estimated Project Cost (EPC)

Not Indicated

Various non-compliance in the implementation of I-REAP subprojects in PLGU Antique were noted including (a) retention of income by the recipient affecting subproject sustainability; (b) non-compliance on sale and collections procedures; (c) non-compliance on the disbursement of funds policy; (d)

implementation of the project.

(BFAR/PHILOPP2)

b) Municipal personnel

concerned in MLGU Placer,

Masbate to prepare and

submit the updated schedule

of disbursement and project

implementation plan;

(DA/PRDP)

c) PSO Luzon B to include in the

IMA all required provisions

including penalty

clause/sanctions in case of

non-compliance or non-

performance and

cessation/winding up of the

project/contract or support

IMA with document that would

compensate for the deficient

provisions to form part of the

terms and conditions, and

submit to the concerned

Auditor for audit to preclude

the issuance of NS, as

applicable;

d) Provide for the bases of two

different Schedule of Fund

Releases, and schedule of

fund release for the

improvement of Sta. Catalina

Norte-San Isidro-Kinatihan II-

Kinatihan I FMR located in

MLGU Candelaria, Quezon;

e) Issue a written policy in the

appropriate adjustment of

ABC in conjunction with the

existing provisions with RA

9184 IRR and GPPB

Resolution, as applicable,

define the extent of

“substantially higher” bid that

should be rejected outright

within the scope of PRDP

43


IA Project Amount

(Million P) Remarks

DA PRDP NPCO, PSOs

no binding contract agreement between the Lead PG and recipients resulting in undefined accountability of the contracting parties; and (e) non-maintenance of financial records contrary to the provisions of I-REAP Operations Manual, Enterprise Investment Agreement and Business Plan.

The project incurred negative slippage of 5.33 percent deviating from the approved plans and project's S-Curve; thus, delaying its completion and the benefits that the constituents could have derived therefrom. (CAR-Benguet)

The project was not constructed in accordance with the plans and specifications that might result to inferior quality of the project and eventually deny the constituents of its extensive utilization. (CAR-Benguet)

The implementation of the project was suspended due to non-compliance with the 18% gradient of the PRDP delaying its final completion and the benefits that farmers could derive therefrom. (CAR-Benguet)

0.314 Purchase of semi-expendable PPE outside the purpose for which it was intended or not utilized at all hence considered unnecessary.

PRDP

219.881 Concreting of Pinagwarasan to Lanot Road project (I-Build Component) was not completed on schedule or within the specified contract time, contrary to Memorandum of Agreement (MOA) and Section 2 of PD No. 1445, thus, the delivery of desired benefits of farmers and fishers to improve their lives was not achieved. (Camarines Norte)

Not Indicated

The project Rehabilitation/ Concreting of Poblacion-Farmington-Galingon-Balacbaan-Cabong-Tilubong FMR, Municipality of Tampilisan ZDN, is 39.751%

subproject procurement

consistent with prevailing

laws, rules and regulations,

and resolve the inconsistent

provisions in the IMA on

additional cost for contract

cost exceeding the EPC and

the bases thereof considering

the depleted fund for the I-

Build Component. (DA/PRDP)

f) PRDP Project Director to:

Direct the NPCO and PSO

Luzon B to submit proof,

document or report showing

that the identified 17

geotagged devices, DSLR

cameras were actually used

for its intended purpose to

preclude the issuance of ND

as a result of

unnecessary/excessive

procurement, and provide a

definite timeline for the

installation and utilization of

the fax machine as the use of

the equipment could not be

ascertained at a specific time.

g) Require the Head of NPCO to

identify each recipient of the

mobile wifi indicating the

reasons for the need for the

same with certification from

DA officials that no gadget of

similar nature was previously

issued to them. (DA/PRDP

NPCO, PSOs)

h) Strictly monitor

implementation of the project

in accordance with the plans

and specifications; Compel

the Contractor to immediately

complete the project and

repair defects, remove and

replace the sections with

44


IA Project Amount

(Million P) Remarks

DA PRDP complete per report of the PPMIU Resident Engineer. It was determined that as of December 31, 2017, the project should have been 42.22% completed thereby incurring a negative slippage of 2.47%. (Zamboanga del Norte)

The steel screen surrounding the Cacao Production and Marketing, Municipality of Piñan, ZDN for the vermicast was already partly damaged as evidenced by presence of rust. The project will be delayed by 1 to 2 months due to the grafting of the seedlings. The PPMIU of the PLGU did not conduct monitoring and evaluation of the project which is required under Section 5.0 of the signed IMA. (Zamboanga del Norte)

The Abaca Fiber, Municipality of Kalawit, and Swine Production and Marketing Enterprises, Municipality of Siayan, both ZDN projects, have not yet commenced. The PLGU has already set up its counterpart funds for the project. (Zamboanga del Norte)

DA

ARCP II 22.420 Delayed implementation and non-completion of the Rehabilitation with 2.0 km Concreting of Sitio Bolanao-Litolet FMR and Moyo-Sitio Pase FMR projects within the time frame, resulting in the cancellation of allocated funds in violation of Annex I, Revised IRR of RA No. 9184. (Zamboanga del Norte)

26.021 Non-completion within the time frame of the Concreting of Motibot- Sto. Rosario FMR as provided in the contract and Revised IRR of RA No. 9184.

DA PRDP 0.200 4.613

Deficiencies in the implementation of the Concreting of Bukang Liwayway- Makandring FMR at Bgy. Langogan and preparation of the ABC and POW was not in accordance with the guidelines set forth under DPWH DO No. 22 dated February 18, 2015, thus, resulting in excessive contract costs. (Puerto Princesa)

severe honeycombs or any

defective installed items; and

institute legal actions against

the contractor for failure to

undertake and/or complete

the project within the periods

specified in the contract.

(DA/PRDP/Puerto Princesa &

Mt. Provinces)

i) Consider a different gradient

for PRDP projects

implemented in the Province

of Benguet or whole of

Cordillera Administrative

Region because of the terrain

in the region; and henceforth,

conduct survey on all

proposed project sites to

determine their actual

physical conditions before the

preparation of plans and

specifications to prevent

suspension of the projects

during implementation.

(DA/PRDP)

j) Comply with the provisions of

the IMA and the Manual of

implementation for PRDP I-

Build project specifically the

imposition of liquidated

damages for all contract or

project which incurred

delayed. Should there be time

extension, submit all pertinent

documents for evaluation.

(DA/PRDP)

k) Monitoring & Evaluation Sub-

Unit, and the Procurement

Sub-Unit to provide necessary

assistance to fast-track

procurement of goods

necessary for implementation

of the project "Mountain

Province Arabica Coffee

45


IA Project Amount

(Million P) Remarks

I-REAP 305.066 The implementation of four FMR projects is behind schedule resulting in delayed delivery of better road networks to the intended beneficiaries. (Mt. Province)

3.291 The project component has not yet been started despite the availability of funds intended for the project.

MINSAAD Not Indicated

Implementation and completion of various Agri-Business, Agro-Forestry, and Infrastructure Projects was not implemented within the time frame, thus, delaying delivery of benefits to the intended beneficiaries. (Compostela Valley)

Rice seedlings distributed did not sustain for long time due to unsuitable climate condition, thus, did not benefit the beneficiaries. (Compostela Valley)

Implementation of seventeen MINSAAD projects of DARPO Davao del Sur is considerably delayed with only two being completed as of December 31, 2017, depriving the intended beneficiaries of the benefits expected to be derived from its purpose. (Compostela Valley)

DENR FMP Insufficient funds in PENROs Ifugao and Quirino and delayed mobilization of People’s Organization in PENROs Quirino, Nueva Vizcaya and Iloilo

Not Indicated

The Work and Financial Plan on the site Development Contract with the People's Organizations was not strictly followed resulting in the delayed implementation of the same and the low utilization of funds. (Iloilo)

DSWD

KC- NCDDP ADB & WB

15.340 Fourteen SPs were found deficient due to failure of RPMO/SRPMO as well as project proponents to monitor and resolve project issues, thus, may compromise the efficient and effective use of the facility and not in keeping with KC-NCDDP Community Empowerment Activity Cycle and Monitoring and Evaluation Sub-

Enterprise". (DA-Mt. Province/

PRDP)

l) Consult

residents/beneficiaries and

consider their

recommendation and other

factors that would affect the

output of the projects to avoid

wastage of resources.

(DA/MINSAAD)

m) Instruct personnel to closely

monitor accomplishment and

mobilization of the POs to

ensure project completion by

year 2022. (DENR/FMP)

n) Instruct the PPMO to monitor

and evaluate the adherence of

the POs to the WFP for SD

contracts awarded to ensure

the proper implementation of

the projects; and Adopt

measures or catch up plan to

address the delayed

implementation of the

activities in the SD contracts;

(DENR/FMP)

o) ACTs and RPMOs personnel

to: Regularly monitor the on-

going and unimplemented

SPs especially those at the

far-flung areas and fast track

their completion; Request

assistance from the LGUs in

the acquisition of project sites;

Make representation with the

concerned government

agencies for the immediate

release of clearances and

permits needed for the

projects; Enjoin the

community to work within the

timeline of the project

implementation; Furnish the

46


IA Project Amount

(Million P) Remarks

Manual for Program Implementer.

SPSP 1,205.80 The account balances of CCT/MCCT beneficiaries under the cash card, prepaid card, and FCB mode of payment included 1.89 million accounts with balance of P1.206 billion, ranging from P501 to more than P50,000 that were not withdrawn from 30 to 2,190 days upon pay-out, thereby showing that there is no immediate need for the financial assistance, and casting doubt on the eligibility of the chosen beneficiaries. Moreover, 32,783 accounts with a total balance P108.614 million have no date of last monetary activity, but still included in the list of beneficiaries.

DA

SCHARMP 0.286 The project, “Rehabilitation of Masla-Duagan Farm to Market Road” still incurred deficiencies as re-validated and re-inspected by COA Technical Services.

DOTr CBRT

312.65 Transfer of the procurement of Technical Support Consultant (TSC) by the Department of Transportation (DOTr) to the Procurement Service – Department of Budget and Management (PS-DBM) despite having its own Bids and Awards Committee (BAC) caused further overall delay in the implementation of Cebu Bus Rapid Transit (CBRT) Project for more than one year and two months as of year-end and incurrence of unnecessary administrative cost of P2.952 million in the form of service fee. The delay in project implementation also resulted in low utilization/availment of loan proceeds hence the accumulation of CFs for CYs 2015-2017.

NBACSEPPCEMTSMMP: CBRT Project; New CNS/ATM

1,333.53 Recoupment of CY 2016 balance of the account Advances to Contractors of P3,411.100 million and additional advances of P217.471 million during the year, or a total of P3.629 billion was only P2.295 billion or 67.28 percent thereby, leaving a balance of the account of P1,333.526 million as

BSPMCs with the list of good

standing contractors and

suppliers; and blacklist erring

contractors and suppliers.

(DSWD/KC-NCDDP-ADB &

WB)

p) Officials to remit in full to the

BTr the amount refunded by

conduits representing

unclaimed cash grants of prior

years; and Revisit and

strengthen the policy on

forfeiture of unclaimed cash

grants and remittance of

refunds to the BTr to ensure

that government resources

are maximized.

(DSWD/SPSP)

q) Issue final notice to Contractor

to correct deficiency,

otherwise, ND will be issued

covering the amount of

deficiency. (DA/SCHARMP)

r) Submit the reason/causes of

the delay and/or negative

slippages of the project

components, and work plan to

address the delays, and

justification on the transfer of

procurement of TSC to the

PS–DBM despite WB and

GPPB’s recommendations;

Prepare a catch-up/work plan

to attain the target completion

dates indicated in the agreed

timelines; Require all

stakeholders to

avoid/minimize further delays

in the procurement process of

the remaining project’s

components and their

implementation; and Require

the PMO-CBRT to adopt an

effective project monitoring

47


IA Project Amount

(Million P) Remarks

Project; MSCIP & PPADP

at year-end. The low recoupment rate could be attributed to the delayed submission of claims for progress billings of the consultant for New Bohol Airport Construction and Sustainable Environment Protection Project (NBACSEPP).

DPWH

CLLExP, ARBP II, PMRCIP II, FRMP, RUPP and RIIDP

27.647 Delayed procurement procedure and project implementation by selected contractors; and current issues on relocation of informal settlers and viability/practicability of project sites which should have been addressed during feasibility or preliminary engineering study.

NRIMPP II

0.023 Lapses in the procurement, delivery and distribution of Universal Testing Machines resulting in incurrence of unnecessary expenses.

DOE E-Trikes 94.029 The specifications of some items offered by the winning bidder were not in conformity with the Agency requirements and contract specifications. Further, the reasonableness of the contract cost could not be determined due to the absence of detailed breakdown of the Approved Budget for the Contract (ABC) and Contract Cost. There was only six months remaining before the closing of the loans. Commitment charges and management fees were incurred due to low loan availment.

MDFO ARCP 2 Not Indicated

Delayed/Non-submission of or inability of the LGUs to meet documentary requirements for the release of fund for sub-projects.

NIA PIDP 44.74 The leniency of BAC and TWG resulted in the award of a contract for Mindoro Oriental Marinduque Romblon (MOMARO) IMO to a non-compliant/ineligible contractor as discussed below:

Completeness of information in the Contractor’s Key Personnel’s Affidavit of Commitment to Work on the Contract to know whether the Contractor and his key

system and to fully utilize the

work of the Financial

Management Specialist to

maximize loan availments and

avoid accumulation of CFs.

(DOTr/CBRT)

s) Ensure continuous and

effective monitoring of

additions/payments and

recoupments of Advances to

Contractors and require all the

PMOs to adopt an effective

project monitoring system;

require contractors and/or

consultants to expedite

submission of Claims for

Payment or Progress Billings;

and submit

reason/justification on the late

filing of the said PBs and

actions taken by PMOs.

(DOTr/NBACSEPP;CEMTSM

MP:CBRT Project; New

CNS/ATM Project; MSCIP;

and PPADP)

t) Adopt efficient and timely

procurement procedure and

comply with duly responsive

strategies adopted to

accelerate fund utilization;

Prepare catch up plan to

ensure that the projects are

implemented on targeted

schedule; Impose liquidated

damages; and initiate

termination/rescission of

contract on projects with

liquidated damages of 10

percent and negative

slippages of more than 15

percent due to contractor’s

fault or negligence, pursuant

to Section 68 and Annex I, of

the Revised IRR of RA 9184;

Disclosed during the planning

48


IA Project Amount

(Million P) Remarks

personnel have on-going project/s with other IMOs within the NIA MIMAROPA Region not verified.

No proof of actual inspection of equipment and/or evaluation of ownership or lease/purchase agreement supporting the Equipment Utilization Schedule of on-going projects of the Contractor to ensure that equipment are still available for Contract implementation.

Comparison of the List of Contractor’s Equipment disclosed that the Contractor pledged some equipment which were already provided in the first two (2) Contracts with MOMARO IMO.

Duly-approved Construction Safety and Health Program and Contractor’s Environment Management Plan were not submitted.

Surety bond was posted by the Contractor instead of either of the required forms, particularly, cash, cashier’s/manager’s check, or bank guarantee.

NIA ARIIP Not Indicated

ARIIP is yet to be fully turned-over to NIA Regional Office No. I which is not in accordance with NIA Memorandum Circular No. 43 S. of 2007 and Plans of Action under Unnumbered NIA Memorandum dated March 24, 2015, thus affecting the account balances reflected in the financial statements of the Regional Office.

DBP DSSDP The Branch granted loans to private corporations out of ODA funds contrary to Section 4 of RA No. 8182 dated June 11, 1996, thus depriving other bonafide recipients of government priority economic and social development projects of needed funds. ODA shall not be availed of or utilized directly or indirectly for the Financing for private to commercial credit. Wadeford

stage any problems on

relocation of informal settlers

and viability of the project

discovered during preliminary

engineering study should be.

(DPWH/CLLExP, ARBP II,

PMRCIP II, FRMP, RUPP,

RIIDP & NRIMPP II;

DA/PRDP)

u) Provide explanation and/or

basis for accepting the

winning bidder’s offer despite

its non-conformity with the

required technical

specifications and provide the

detailed breakdown of the

ABC and Contract Cost.

Henceforth, require the

establishment of an ABC for

all projects, including ADB-

funded projects, as a basis to

determine if the bidders’ offer

is acceptable or not. (DOE/E-

Trikes)

v) Identify issues/difficulty in the

submission or compliance by

LGUs with documentary

requirements and provide

technical assistance to LGUs

as deemed necessary to

maximize availment of grants.

(MDFO/ARCP 2)

w) BAC and TWG to: Ensure that

procurement requirements

are consistently followed from

bid documents to project

completion, and that bid

evaluation and post-

qualification procedures

prescribed in the Revised IRR

of RA No. 9184 and GPPB

Manual of Procedures for the

Procurement of Infrastructure

Projects are strictly followed;

49


IA Project Amount

(Million P) Remarks

Foundation, Inc. and Saint Dominic School of Kalibo, are private corporations with ready access to commercial credit. (Region VI)

and Require the Head of the

Procuring Entity (HOPE) of

NIA-Occidental Mindoro IMO

to request the IAS and the

Legal Department of the NIA-

HO to conduct investigation to

determine the extent of

participation of the members

of the BAC and its TWG

including NIA officials in the

award of contracts to non-

compliant contractors and to

file appropriate charges, if

warranted. (NIA-PIDP)

x) Coordination with the former

officials of ARIIP who are

presently employed in

ARISEP in the turn-over of

completed project. Any

concerns relating to the

turnover must be discussed

by both parties and resolved.

In addition, assistance from

the Construction CMD of NIA

CO may be sought in case of

issues which could not be

resolved by the parties

involved in the turn-over.

(NIA/ARIIP)

y) Grant only term loans to

borrowers whose program

and projects are in

consonance with the national

priority projects pursuant to

Section 4 of RA No. 8182

dated June 11, 1996, and

submit valid justification for

the deviation from the criteria.

(DBP/DSSDP)

C. Financial Management

1. Payments were made even for transactions with incomplete/inadequate documentation, without legal basis or non-compliant with existing rules and regulations, among others. In other cases, payments

Management to require the

concerned officials to:

50


were made in full without deducting the required retention money.

In a number of instances, transactions without legal basis

and/or with incomplete or inadequate supporting

documents or non-compliant with existing rules and

regulations were just the same paid. The Team also

noted payments in full without deducting the required

retention money:

IA Project Amount

(Million P) Remarks


Contractors/PG paid despite incomplete supporting documents. (PLGUs Bataan; Camarines Sur; Camarines Norte; Guimaras, Iloilo MLGUs Paoay, Ilocos Norte; Buenavista, Quezon; Nasipit, Agusan del Norte; Trento, Agusan del Sur)

Time extensions were granted several times despite deficient documentary requirements. (PLGUs Camarines Norte; Iloilo MLGU Veruela, Agusan del Sur)

Other deficiencies in the submission of contract and liquidation reports (PLGUs Sorsogon; Guimaras; Iloilo)

Travel expenses amounting to P300.00 or less incurred by the officials and employees of RPCO IV-A were not supported by a Certification of Expenses Not Requiring Receipts as required by COA Circular No. 2017-01 dated June 19, 2017.

Several claims for travelling expenses and per diems by the PRDP for the period August 2016 to June 2017 were paid in excess of the amounts allowed under EO No. 248 as revised under EO No. 298 dated March 23, 2004, thus, considered as excessive expenditures pursuant to COA Circular No. 2012-003 dated October 29, 2012. (Region II)


Non-deduction of retention money from the claim of Contractors. (CLGU Lucena, Quezon and PLGU Albay) Absence of or expired performance security. (PLGU Albay and MLGU Trento, Agusan del Sur)

a) Submit all required

supporting document

including evidentiary support

on contract time extension;

computation of ABC and its

supporting Market Survey

and true copy of the JEV

issued by Region XII,

covering recorded receipt of

two units excavator,

transferred from the books of

the NIA Central Office, ARE

and report of Physical Count

of PPE as of December 31,

2014 and December 31,

2015 duly verified by the

COA Auditor to evaluate the

propriety of payments to the

contractor/PG. See to it that

disbursements of public

funds are supported with

complete documentation in

compliance with the

provisions of Section 4 of PD

1445.

(DENR/INREMP/FMP;

DA/PRDP; NIA/NISRIP)

b) PPMIU of PLGU Sorsogon

to ensure that PRDP

transactions are legal and

valid; require submission of

liquidation documents,

physical and financial

reports in accordance with

existing guidelines.

(DA/PRDP)

c) Comply with the existing

laws, rules and regulations

regarding the payment of

travelling expenses and per

diems and refund the excess

claims. (DA/PRDP)

d) Accountant to withhold the

uncollected/deficient

51


IA Project Amount

(Million P) Remarks

DA 0.354 Payments for Representation Expenses, Relocation Allowance in PSO Visayas and various purchases in RPCO XI were not supported with valid documentary requirements to prove the reasonableness and necessity of the transactions, thus, rendered the occurrence and validity of the disbursements, doubtful.

15.803 Honorarium/ incentive was paid to DA officers and employees detailed to NPCO, PSO Luzon A, RPCOs II, III, X and XI on a part-time or full-time basis without complying with the guidelines set forth in the DBM Circular No. 2007-2 dated October 1, 2007 and COA Circular No. 2012-001 dated June 14, 2012, thus, documentary requirements to support the payment thereof were inadequate.

The payment of performance incentive on March 2, 2017 by the PRDP to its consultants/ COS/project-hired and DA personnel has no legal basis and not in accordance with National Budget Circular No. 433 dated March 1, 1994 and Civil Service Commission (CSC) Resolution No. 020790 dated June 5, 2002, thus, considered as irregular and excessive expenditures pursuant to COA Circular No. 2012-003 dated October 29, 2012. (Region II)

2.305 The procurement procedural lapses such as non-posting of the Invitation to Bid and posting of 5% performance security in the claim for the implementation of I-REAP sub-projects for civil works portion, Oriental Mindoro Calamansi Trading Center and Buying Station, with a total contract cost of P2,305,362.00 violated Sections 21.2.1 (b) and 39.2 of the Revised IRR of RA No. 9184. Moreover, the paid disbursement vouchers on this claim were not supported with complete documentation contrary to Section 4.6 of PD No.1445.

retention money from

subsequent billings of

contractors in CLGU

Lucena, Quezon and PLGU

Albay, and to strictly

implement proper

withholding of retention

money on partial billings by

contractors, as applicable;

(DA/PRDP)

e) BAC and/or PEO of PLGU

Albay and MLGU Trento,

Agusan del Sur to strictly

comply with the Revised IRR

of RA No. 9184 on the proper

posting of performance

security and require

contractors to renew the

performance bond as

applicable and furnish the

Auditor a copy thereof;

f) Monitor implementation of

infrastructure projects with

more than one year contract

duration; (DA/PRDP)

g) Stop the practice of paying

honoraria to DA employee

assigned to the PRDP on a

part-time or full-time basis;

and Require the concerned

personnel to refund the

amount of the honoraria

received. (DA/PRDP)

h) Stop payment of salary

differential to full-time

detailed officials/personnel

in NPCO, RPCOs II and III,

PSOs Luzon A and Visayas

pending the Decision on the

Petition for Review filed by

the PRDP before the COA-

CP on November 6, 2017 on

the disallowed salary

52


IA Project Amount

(Million P) Remarks

DA PRDP- I-REAP I-BUILD

77.934 The incomplete submission of documents for the final inspection of the PRDP I-BUILD infrastructure subprojects, Concreting of Bagong Silang-Macatoc Farm to Market Road (FMR) at Victoria and Concreting of Dulangan I-II FMR, Baco, Oriental Mindoro, and I-REAP civil works portion, Construction of Oriental Mindoro Calamansi Trading Center at Bayanan II, Calapan City and Buying Station at Poblacion III, Victoria, Oriental Mindoro, with a total contract cost of P77,934,368.49, violated COA Circular No. 2012-001 dated June 14, 2012 and COA Circular No. 2009-001 dated February 12, 2009.

PRDP 5.426 Salary differential equivalent to the difference between the PRDP rate and basic salary rate was paid to full time DA/PLGU personnel designated to work in NPCO, PSOs Luzon A and Visayas, RPCOs II and III on a full-time basis contrary to Section 58, General Provisions of RA No. 10717 or the FY 2016 GAA and DBM Budget Circular No. 2007-2 dated October 1, 2007.

Not Indicated

Defective road construction of PLGU Isabela was noted in the implementation of I-Build and I-REAP subprojects.

PRDP- I-REAP I-BUILD

1.426 PSO Mindanao continued to grant year-end incentive to DA organic personnel on detail to PRDP and to

personnel on consultancy contract of services despite the absence of legal basis.

DA PRDP- I-REAP I-BUILD

2.938 The Approved Budget for Contract (ABC) and contract cost of the Rehabilitation of Imbang-Grande-Tagubong-Gemumua-Agahon-Agtabo FMR, Passi City in PLGU Iloilo are over by P2.375 million and P2.192 million, respectively, due to the erroneous mathematical computation of 1,800.70 square meters in the total area of Item 311-Portland Cement Concrete Pavement (PCCP). Likewise, the contract cost for the

differential granted in CY

2015 and the response of

DBM on the letter of inquiry

submitted by PRDP as to the

validity of payment to full-

time employees. (DA/PRDP)

i) PLGU Isabela to ensure that

all work items are computed

using the Detailed Unit Price

Analysis of DPWH to avoid

incurrence of over costing of

contracts and those found to

be defective based on

results of Technical

Evaluation and Inspection by

COA TAS be corrected

and/or rectified. Request for

re-evaluation/inspection

upon correction of the

deficiency. (DA/PRDP)

j) PLGU Iloilo to review the

computations in the ABC

and Contract Cost for the

quantity take off versus

COA Calculation which

resulted in the variance

indicated in the TSO Report;

and effect corrections, if

warranted; and MLGUs

Trento, Agusan Del Sur and

Nasipit, Agusan Del Norte to:

Instruct the Municipal

Accountant and Treasurer to

withhold/deduct the excess

amount from the amount

payable to the contractor,

otherwise, a ND will be

issued. (DA/PRDP)

k) Comply with the provisions

and guidelines in the

Revised IRR of RA No. 9184

particularly on budget

allocation, preparation of the

approved budget for the

53


IA Project Amount

(Million P) Remarks

DA Rehabilitation/Concreting of FMR in PLGU Isabela and MLGU Trento, Agusan del Sur and Rehabilitation of CIS in PLGU Nasipit, Agusan del Norte was found to be excessive considering that it is higher than the COA estimated cost. (PLGUs Iloilo, Isabela, MLGUs Trento, Agusan del Sur and Nasipit, Agusan del Norte).

PRDP RPCO X

1.087 Catering Services of various trainings and seminars in CY 2016 and 2017 were paid prior to the perfection of the terms and conditions agreed upon per Purchase Order (PO), contrary to the provisions of the Revised IRR of RA No. 9184.

0.424 Purchases of plane tickets on official travels of personnel were not included in the approved Annual Procurement Plan (APP) of the agency and procured without competitive bidding contrary to IRR and RA No. 9184, thus, no assurance that the prices obtained/offered were the lowest costs prevailing in the market.

IBRD-WB- PRDP project

0.200 4.613

The COA TAS noted several deficiencies in the implementation of Concreting of Bukang Liwayway- Makandring Farm to Market Road (IBRD-WB-PRDP project) at Bgy. Langogan. Moreover, preparation of the ABC and Program of Work (POW) was not in accordance with the guidelines set forth under DPWH Department Order (DO) No. 22 dated February 18, 2015, thus, resulting to excessive contract costs. (RO 4B, Palawan)

Not Indicated

Payment of Progress Billing for the Concreting of Bukang Liwayway to Makandring Farm to Market Road Project, Barangay Langogan did not meet the required minimum physical percentage of accomplishment based on the schedule stated on the PRDP Project Implementation Management Agreement (IMA).

Provisions of RA No. 9184 not

observed resulting in irregular expenditures. Several goods and services were purchased without any

contract, procurements

involving catering services,

procurements based on the

approved APP, documentary

requirements such as duly

signed request for

Quotations by the

prospective suppliers; and

Pre and Post Repair

Inspection Report. (various

projects)

l) Submit all lacking

documents to the Audit

Team and COA-TAS for the

final evaluation and

inspection of the affected

projects. (DA/PRDP/I-

REAP/I-BUILD/IBRD)

m) Stop the practice of

procuring plane tickets

directly from DAMPC,

instead include its cost in

cash advances granted to

the concerned personnel in

accordance with EO No. 248

dated May 19, 1995, as

amended by EO No. 248A

dated August 14, 1995 and

EO No. 298 dated March 23,

2014. (DA/PRDP)

n) Require the recipients of the

CY 2017 Year-End

Incentive, performance

incentive and honorarium to

refund the amount received

in full; and Stop the grant of

unauthorized benefits.

(DA/PRDP;

DENR/InREMP/FMP)

o) Prepare the ABC and POW

in accordance with the

revised guidelines set forth

under DPWH DO No. 197

54


IA Project Amount

(Million P) Remarks

perfected contract and/or fully/partially delivered/rendered prior to the approval/issuance of the Purchase Request (PR), Request For Quotation (RFQ) and Purchase Order (PO). Procurement of goods and services not coursed through the Bids and Awards Committee (BAC); and business name and address of prospective suppliers not indicated in the RFQ when issued, and procurement of motorcycle is irregular. (Ifugao, CAR)

DAR ARCP II 0.784 There were project expenses charged to GCF in CY 2017 although funds transferred were for prior years and without the corresponding legislative enactment for the use thereof for current expenses, contrary to Section 28, Chapter 4, Book VI of EO No. 292. Likewise, expenses thereto were not properly documented and recorded.

CONVER-

GE 0.385 A fixed monthly honoraria were given

to personnel without valid and justifiable basis.

MINSAAD 0 Mobile paid for CY 2017 was not supported with authority/Special

Order specifying the officials and employees entitled to mobile privileges.

DENR

INREMP

0.460 Disbursements for catering services during the conduct of four days Seminar-Trainings in PENRO-Lanao del Norte exceeded the approved budgets for the activities in violation of the provisions of Sections 10 and 31.1 of the Revised IRR of RA No. 9184, Section 4 of PD No. 1445 and COA Circular No. 2012-001 dated June 14, 2012, thereby casting doubt on the validity of the transactions paid.

PENRO Ifugao

Not Indicated

Payment for reimbursement of travelling expenses of PENRO-Bukidnon personnel during CY 2017 were not evaluated with regard to its urgency and necessity, as the number of days allegedly travelled in achieving their respective purposes were excessive.

dated October 7, 2016; and

Require all contractors of the

affected projects to refund

the total excess cost of

P4,613,412.88 or deduct the

same from any money claim

or retention fee due them or

other securities posted by

them; and to repair the

defects and other installed

items or unperformed works

noted amounting to

P200,141.25 or deduct the

amount of cost deficiencies

from any money claim or

retention fee due them or

other securities posted by

them. (DA/ IBRD-WB-PRDP

project)

p) Strictly comply with the MOA

or IMA, particularly in the

financial management

system for National

Government Agency funded

programs/ projects/activities

in a manner adequate to

reflect the operations of the

City Government in carrying

out the Sub-project or any

part thereof.

q) Refrain from using the

balance of the GCF for

current year expenses.

(DAR/ARCP II)

r) Submit legal basis for the

payment of honoraria with

report of accomplishments

showing level of difficulty of

their duties and

responsibilities, the extent of

productivity and quality of

performance of the

recipients of honoraria.

(DAR/CONVERGE)

55


IA Project Amount

(Million P) Remarks

FMP

0.425 Payment of Honoraria to DENR RO VI and PENRO Iloilo officials and personnel was not included in CY 2017 FMP Work and Financial Plan (WFP), thus, may be considered illegal expenditures.

Non-deduction of retention money for warranty as required under Section 54.5 and Section 62 of the 2016 Revised IRR of RA No. 9184, thus, correction of defects for the works done was not assured. (PENRO-Ifugao)

0.707 Plantation sites with total area of 138.53 hectares were established within the existing natural forest contrary to DENR Memorandum Circular No. 11, dated Oct. 11, 1988 thus resulting in overpayment. (CAR, Ifugao)

0.055 Honoraria paid to DENR RO VI officials involved in the implementation of the Forestland Management Project (FMP) was charged against the Fund 101 Trust contrary to Section 4 (3) of PD No. 1455 and DBM Budget Circular No. 2007-002 dated October 1, 2007, thus, may be considered as illegal expenditures. (Region VI)

0.114 Repair of vehicle in PENRO Ifugao is beyond the 30 percent maximum allowable cost of repair of vehicle, thus, considered unnecessary and excessive.

DENR PENRO Kalinga

INREMP 0.434 Unit costs of contracts awarded for the implementation of afforestation and reforestation projects for CY 2016 are inconsistent with FMB Technical Bulletin 1-2, thus unnecessarily increasing expenditures. (CAR, Kalinga)

LBP YRP Not Indicated

The Progress billings/payments to LGUs and Contractors for the projects lacks documents required in the separate Agreement to the Financing and Project Agreement and related Progress Billing Procedures. The YRP Special Deposit Account disclosed deviations from the terms

s) Submit justification for

charging the expenses to the

project instead of from the

regular funds and the basis

for claiming in excess of

P1,000.00 monthly

allocation for division chiefs;

and concerned claimants to

attach a copy of the SO

entitling them to cellphone

allowances.

(DAR/MINSAAD)

t) Discontinue the practice of

charging to Fund 101 Trust

account, expenses which

was not related to the

purpose for which the trust

was created.

(DENR/INREMP/FMP)

u) PENRO Ifugao to consider

disposing fully depreciated

vehicle and no longer

economical to maintain to

avoid further incurrence of

expenses and make

representation with the DBM

for acquisition of a new

vehicle. (DENR/FMP)

v) Request the repair shop

concerned to fix air

conditioning unit of the

vehicle free of charge; and

deduct retention for warranty

security or require special

bank guarantee pursuant to

Section 62.1 of the 2016

Revised IRR of RA No. 9184.

(DENR/FMP-PENRO

Ifugao)

w) Submit justification on

payment of plantation site

within the existing natural

56


IA Project Amount

(Million P) Remarks

and conditions of the Separate Agreement to the Financing and Project Agreement, such as: non-submission of certain requirements for progress billings/payments; and the total amount of ORs issued by the Contractor does not correspond/reconcile with the total amount released to LGUs. These were not supported by ORs.

NIA

PIDP

0 The documents supporting payments made to Equi-Parco Construction Company for Contract No. PIDP11-C-BRISN-3 were not complete, contrary to Section 4(6) of PD No. 1445. Thus, validity and propriety of payments could not be ascertained. The incomplete documentation, along with the non-approval of key personnel replacements and quantity changes, inconsistent signatories, and excessive time extension without supporting no objection document from World Bank (WB) and without approved revised PERT/CPM Network Diagram; are indicative of poor execution, supervision, monitoring, and evaluation of the procurement and implementation of the Project.

NISRIP

13.365 The non-submission of documentary requirements for procurement of goods for the supply and delivery of one (1) unit Hydraulic Excavator, crawler mounted and one (1) unit Hydraulic Excavator, crawler swampy, cast doubt on the propriety of the disbursement. Likewise, the inconsistencies in the dates of the delivery and acceptance of the equipment as shown/reported in various documents resulted in inadequate imposition of liquidated damages (LD). LD should have been computed from September 28, 2014 to July 22, 2015, equivalent to 296 days in the amount of P1.34 million, but the penalty imposed and paid by the contractor per NIA’s OR No. 221250 dated May 26, 2017 was only P44,045.83, short of P1.29 million.

forest. Henceforth, consider

the existence of micro forest

in future reforestation

contracts to avoid waste of

government funds.

(DENR/FMP/PENRO-

Ifugao)

x) Make representation with

higher authorities for

clarifications on the

inconsistencies in unit cost

and submit replies to the

office of the auditor; and

Amend contracts awarded if

warrantied to avoid

disallowance in audit.

(DENR/INREMP/PENRO-

Kalinga)

y) Comply with disbursement

procedures in the Separate

Agreement Financing and

Project Agreement between

the KfW and LBP, and

related Progress Billing

Procedures to ensure

successful implementation

of the project; and Require

LGU to submit ORs issued

by the Contractor for funds

received. (LBP-YRP)

z) PIDP PMO to submit lacking

documents and ensure

adequate supervision over

implementation of the

Contract; Monitor the

equipment mobilized and

key project personnel

deployed in the Project;

Prepare and submit Daily

Inspector’s Report to PIDP

PMO; and Completely

evaluate work

accomplishment to

determine whether each

57


IA Project Amount

(Million P) Remarks

Hotel accommodation and meals of personnel from other Offices were paid from NIA INIMO Fund 501 LFPs contrary to Section 6 of Executive Order No, 298, s. 2004. (Region I)

TIEZA BEIP 442.636 Transfer Certificate of Title (TCT) to the Investment Properties acquired by TIEZA either by purchase or donation remained not in its name.

work item delivered is

compliant with the Technical

Specifications (TS) of similar

contracts. (NIA-PIDP)

aa) Impose liquidated damages

for every delay in the

subproject implementation;

Bill the contractor and collect

the remaining liquidated

damages; Initiate the

conduct of an investigation

to determine the extent of

participation of NIA officials

and employees in the

delivery of equipment

resulting in non-imposition of

the maximum liquidated

damages and file

appropriate charges if

warranted.

(NIA/NISRIP;DA/PRDP)

bb) Payment of travel expenses

shall be strictly in

accordance with Section 6,

EO No. 298 s. 2004, in case

of payment of actual

expenses, the necessity of

such expense shall be

certified by the head of the

agency. (NIA/NISRIP)

cc) Expedite the transfer of the

real properties’ title in the

name of TIEZA. (BEIP)

2. The financial reports/documents were not submitted to the concerned Auditors within the period prescribed under existing laws, rules and regulations.

The concerned implementing agencies failed to submit to the concerned Audit Teams financial statements and reports within the period prescribed under foreign donors’ guidelines/manuals, existing laws, rules and regulations. Thus, timely audit actions cannot be undertaken as in the following instances:

Management is required to:

a) Accountant, Focal Person

and Finance Unit to

immediately submit DVs,

IMA, Purchase Orders,

contracts duly supported,

terminal reports, Statement

of Receipts and

Expenditures and all

58


IA Project Amount

(Million P) Remarks

DA PRDP 61.535 The accounting and financial reports/statements and DVs and/or Statement of Receipts and Expenditures and RCI of three PSOs, four RPCOs, eight PLGUs and six MLGUs were not submitted for review within the prescribed period contrary to Sections 6.7.1 and 6.7.2 of PRDP Financial Management Operations Guidelines.

666.608 Copy of IMA, POs and contracts together with supporting documents were not submitted by RPCO V, PSO Mindanao and MLGU Trento, Agusan del Sur within five days after its perfection, contrary to COA Circular No. 2009-001, RA No. 9184 Revised IRR, World Bank Procurement Guidelines and PRDP Operations Manual (FMOM).

Not Indicated

Bank Reconciliation Statements (BRS) under MDS and Trust accounts were not in conformity with the prescribed GAM format and were not submitted within the prescribed period. (Region II)

SCHARMP 1.310 Sixty one (61) DVs pertaining to the period September and December 2017 remained unsubmitted as of audit date.

EHRDP Not Indicated

Approved Terminal Report and financial reports to establish the physical and financial accomplishment of the Program not submitted.

DENR FMP INREMP

Not Indicated

BRS were not submitted within the prescribed period, contrary to Section 5, Chapter 21 of the GAM, Volume I; Section 74 of PD No. 1445 and COA Circular No. 92-125A.

The Monthly Report of Official Travels and Monthly Report of Fuel Consumption were not submitted, contrary to COA Circular No. 2013-002.

accounting and financial

reports to COA, otherwise,

suspension of the salaries of

concerned personnel will be

recommended until they

complied with the

requirements of the

Commission; Strictly

observe the reglementary

period in the submission

thereof as stated in the

PRDP FMOM and existing

laws, rules and regulations.

(DA/PRDP/EHRDP/

SCHARMP; LBP/CADF)

b) Submit BRS and Monthly

Reports of Official Travels

and Fuel Consumption

within the timeframe

established by regulations;

and Coordinate with the

Government Service Banks

on the use of internet

banking facility, particularly

on its capability to access

and download statement of

accounts/bank statement

needed in the preparation of

BRS and use the prescribed

format provided in GAM

Volume II in the preparation

of BRS.

(DENR/FMP/INREMP;

DA/PRDP)

59


IA Project Amount

(Million P) Remarks

FMP

Not Indicated

CY 2017 DVs for the months of June and August to December 2017 for Fund 102-GOP; and May to December 2017 for Fund 102-LP, not yet submitted.

LBP

There was significant delay in the submission of the financial statements and supporting documents resulting in the late issuance of Audit Report for the year ended December 31, 2016, contrary to paragraph 2.06 (c) of the Annex to the CADF Grant Agreement and further affecting bank reputation. The Special Account Statement, Statement of Expenditures and Notes to Financial Statements for the year ended December 31, 2016 were submitted only on January 30, 2018.

3. Implementing agencies failed to revert back or remit collections and unused balances and interest income generated therefrom to the BTr.

Huge amounts of unutilized funds and collections were not reverted back or remitted by the concerned implementing agencies to the BTr and remained in their respective depositary accounts:

IA Project Amount

(Million P) Remarks

DA PRDP 0.325 NPCO and PSO Mindanao failed to comply on the mandatory remittance of various collections and refunds due to BTr.

1.539 Interest income was not remitted to the BTr by NPCO, PSOs Luzon B and Mindanao contrary to Section 65 of PD No. 1445.

DAR

ARCP II 48.731 DAR continued to maintain the General Control Fund (GCF) under Account No. 0702-1042-03 with an unbooked balance despite the absence of authority to maintain thereof from the Permanent Committee contrary to the Joint COA and DBM Circular No. 4-2012 dated September 11, 2012.

Management to require

concerned officials:

a) Accountants to deposit to the

BTr the unremitted

performance bond, other

refunds and interest income

generated therefrom and

from foreign currency

deposits. (DA/PRDP;

DENR/InREMP;

MDFO/NPS/ENREMP/MRD

P2 and LOGOFIND)

b) Revert back the balance of

the GCF Trust account to the

National Treasury.

(DAR/ARCP II)

c) NPMO to coordinate with

LBP on the status of cash

cards issued to beneficiaries

and make necessary actions

to recover the amount to be

remitted to the Btr; Expedite

the validation, investigation

60


IA Project Amount

(Million P) Remarks

DENR INREMP 0.202 Interests earned from foreign currency account deposits for CY 2017 were not remitted to the BTr.

MDFO NPS- ENRMP MRDP2 & LOGO-

FIND

108.571 Cash balances from proceeds from refunds of unexpended balances made by LGUs, unutilized cash balances from completed projects, and interests earned from three (3) completed projects not remitted to the BTr.

DSWD SPSP

5,385.00 Refunds from LBP conduits in CYs 2013 to 2017, representing unclaimed cash grants of 4Ps beneficiaries for OTC mode of payment, were not returned to the BTr pursuant to Section 88 of the General Provisions of the GAA.

DOH WHO 2.130 Unspent amount of P2.076 million and Interest Income in the amount of P55,428.09 was unreturned due to non-submission of accomplishment utilization reports for every biennium activities/project funded under WHO.

POPSTIRP

2.910 Unutilized cash balances of dormant accounts and interest income earned were not remitted to the BTr.

or re-assessment of the

eligibility of concerned

beneficiaries and fast tract

the implementation of the

resolution to address the

problem; Intensify

monitoring and follow-up of

beneficiaries by field

personnel and update the

data base for non-

compliant/delisted

beneficiaries; and Strictly

implement the NAC

Resolution No. 41, Series of

2017. (DSWD-SPSP)

d) Program Manager to

immediately coordinate with

the implementing agencies

to submit accomplishment

and/or utilization reports and

forward the same to the

Finance Staff for the proper

disposition of the unspent

cash balance of the previous

biennium. Also the Finance

Staff to immediately remit

the interest income to the

BTr. (DOH/WHO)

D. Compliance with Existing Laws, Rules and Regulations and Provisions of the MOA

1. Existing laws, rules and regulation were not observed

and/or complied with in the implementation of various

projects.

Further review of the documents by the concerned audit

teams disclosed the following:

IA Project Amount

(Million P) Remarks

DA

InfRES Not Indicated

Advances to PS-DBM sourced from InfRES project funds aged four to seven years were still outstanding in the books despite completion and closure of the project.


a) Provide for the proper

disposition of the Due from

NGAs-PS (DBM) pertaining

to account balances of

completed projects.

(DA/InfRES)

b) PSO Mindanao to

consistently follow-up

liquidation of long overdue

CAs for travel from personnel

who are no longer connected

with the agency and exhaust

61


IA Project Amount

(Million P) Remarks

DA PRDP 0.610 Non-compliance with the guidelines pertaining to the grant, utilization, and liquidation of cash advances in PSO Mindanao resulting in the accumulation of unliquidated cash advances aged from 28 days to 579 days as of December 31, 2017.

Not Indicated

Out of nine implemented sub-projects of the PRDP, only two were liquidated thereby leaving seven unliquidated as of date contrary to COA Circular No. 94-013 due to delay in processing of liquidations. (Region 5, Sorsogon)

Various deficiencies were noted in the liquidation reports submitted by Proponent Groups contrary to pertinent accounting rules and other financial requirements mentioned in the

Not Indicated

PRDP-IREAP Financial Management Operations Guidelines. (Region 5, Sorsogon)

15.541 Despite purchase and utilization of 12 motor vehicles for NPCO and PSO Luzon B, no markings of “For Official Use Only” were seen on these units, contrary to COA Circular No. 75-6 dated November 7, 1975

11.149 The PPE accounts of NPCO, PSO Luzon B and RPCO V were not insured with the GSIS or any financially sound and reputable insurance companies against damage or loss through theft, fire and other fortuitous events, which is not in consonance with RA No. 656 or the Property Insurance Law as amended by PD No. 245 dated July 13, 1973.

Not Indicated

PRDP Accountable/ Property Officers accountable for the various PPE were not properly bonded, contrary to Treasury Circular No. 02-2009 dated August 6, 2009.

all means to settle the

unliquidated balance; Stop

the practice of treating

special purpose CA as petty

operating expenses under

regular CAs; Instruct

Accountant to verify

accountable officer’s

liquidation reports (LRs) and

either record these within 10

days upon receipt if

complete; demand

immediate submission of

lacking documents to enable

drawing of entries for

liquidation; Stop the grant of

additional CAs unless the

previous CA is settled or a

proper accounting thereof is

made; Direct all AOs to

liquidate CAs within the

prescribed period, and at the

end of the year; and Instruct

the Accountant to require all

AOs to use the RCD form in

liquidating special CAs.

(DA/PRDP)

c) NPCO and PSO Luzon B to:

Provide explanation for the

failure to procure the

required stickers/ prescribed

markings for all the PRDP

motor vehicles; Submit

definite timeline for the

procurement of the

prescribed markings in

compliance with COA

Circular Nos. 75-6 and 75-

6a; and Submit report on the

follow-ups made by the

PRDP on the status of

unissued government vehicle

plates with the LTO.

(DA/PRDP)

62


IA Project Amount

(Million P) Remarks

DA PRDP

2.042 The withholding tax rate used in the payment of honorarium to part-time personnel for CYs 2016 and 2017 was only 10 percent contrary to the provisions prescribed under Revenue Regulations No. 10-2008 dated July 08, 2008 resulting in the under-withholding of tax amounting to P1.075 million and P0.967 million.

4.215 Withholding taxes on government payments in RPCO V and 4B, Oriental Mindoro were not remitted to the BIR within the period prescribed under Revenue Regulation No. 2-98.

4.215 The Withholding taxes on Value-Added Tax and Creditable Income Taxes Withheld-Expanded were not remitted within ten days following the end of the month contrary to BIR Revenue Regulation (RR) 4-2002 dated March 26, 2002

67.589 Non-compliance with laws, rules and regulations resulted in the total disallowances and suspensions in the audit of various transactions amounting to P70.696 million of which P3.107 million were settled, thereby, leaving an outstanding balance of P67.589 million. a. Non-compliance on the policy

on partial settlement of audit disallowances in NPCO, PSOs Luzon B and Mindanao – P6.094 million.

b. Non-settlement of resigned/separated consultants and DA personnel no longer assigned to NPCO, PSOs Luzon B and Mindanao – P4.615 million.

c. Low settlement of suspended accounts in RPCO V – 1.19%

Not Indicated

Settlement of audit disallowances with Notice of Finality of Decision (NFD) were not strictly complied and approved request for instalment payment enforced/

d) Direct the PAccO to prioritize

the processing of PRDP

liquidation reports to reflect

correct and timely events in

the financial reports to be

furnished to its oversight

agencies. (DA/PRDP)

e) Direct the PPMIU to train and

supervise adequately the

Proponent Groups on

financial requirements and

procedures to correct any

deficiencies in accomplishing

liquidation reports based on

accounting rules and

procedures including those

prescribed in the PRDP

manuals. (DA/PRDP)

f) Accountable Officers for all

PPE of NPCO, PSO Luzon B

and RPCO V in coordination

with the Accounting Division,

to facilitate the preparation

and submission of the list of

insurable PPEs for inclusion

in the annual work and

financial plan, so that the

necessary insurance

coverage for all the assets

can be applied with the GSIS

or other reputable insurance

companies. (DA/PRDP)

g) Accountable Officers to be

properly and sufficiently

bonded pursuant to existing

COA rules and regulations;

(DA/PRDP)

h) Accounting Office to (i)

submit proof of remittance of

the under withheld taxes to

BIR in excess of the

allowable statutory amount of

P82,000.00, as applicable;

63


IA Project Amount

(Million P) Remarks

DA PRDP implemented in violation to Section 7.1 of COA Circular 2009-006 dated September 15, 2009 and COA Resolution No. 2017-021 dated November 3, 2017. (Region II)

Project signages in PLGU Iloilo were not compliant and updated with the information required in Item 3.6.4 of the PRDP I-Build Operations Manual and COA Circular No. 2013-003, thus, deprive the people of information on matters of public concern and participation in the monitoring and validation of the efficiency of project implementation, contrary to the transparency and accountability principle on the use of public funds.

15.523 Interest earned from PRDP I-BUILD and I-REAP GOP Counterpart and Loan Proceeds Trust Funds were not transferred to the General Fund, contrary to Section 305(d) of RA No. 7160, otherwise known as the Local Government Code of 1991, thus, they were not considered as part of the local funds which are available for the payment of expenditures and obligations of the Municipality. (Region 4A, Quezon Province)

Not Indicated

Copy of the MOA was not provided to the PGS prior to fund transfer from PRDP and deposit of corresponding LGU counterpart contrary to COA Circular No. 2012-001. (Region 5, Sorsogon)

0.443 Salaries of several job order employees for the “Muyung Project” were inappropriately charged against the Local Counterpart, instead of the Grant, contrary to the approved project proposal and itemized budget, which could adversely affect the attainment of the goals and objectives of the project. (CAR-Ifugao)

and (ii) ensure that

appropriate withholding

taxes are deducted from any

payments in accordance with

the Revised Withholding Tax

Table/ schedule in the TRAIN

Law and to remit to BIR

within the prescribed period

starting CY 2018.

(DA/PRDP)

i) NPCO, PSO Luzon B and

Mindanao, RPCO V to

submit a request for

settlement of disallowances

on installment basis in

accordance with COA

Resolution No. 2017-021,

otherwise refund

immediately are unsettled

balances and enforce

settlement from

resigned/separated

employees by sending

demand letters; Take legal

actions to compel concerned

consultants to refund their

overdue liabilities and

consider withholding a

retention money equivalent

to one/half month

consultancy fee earned for

the first month of service to

compensate for any future

loss in case of AWOL or

similar instances; and Submit

complete supporting

documents of transactions

suspended in audit,

otherwise, initiate the

necessary administrative

and/or criminal action in case

of unjustified failure/refusal to

effect compliance with the

settlement of suspensions.

(DA/PRDP)

64


IA Project Amount

(Million P) Remarks

DFIMDP 2.703 BPI could not determine the employees/officials responsible or accountable for the various PPE recorded in the books sourced from DFIMDP funds as of December 31, 2017 due to the failure of the Property Officer to maintain the PAR, or formerly ARE.

DENR CBFMMP 1.202 PARs were not issued/renewed every three years and every time there is a change in accountability, thus, exposing the property to the risk of possible loss or misuse.

FMP

Not Indicated

Budget of at least five percent was not allocated for gender and development in the Work and Financial Plan for CY 2017, contrary to Section 37 A.2 of RA No. 9710 or the Magna Carta on Women (MCW) and its IRR.

0.062 Cash advances for traveling expenses of PENRO Iloilo amounting to P61,608.00 were not liquidated by the concerned accountable officers within the prescribed period resulting in the non-recording of traveling expenses in the period these were incurred.

DENR FMP- PENRO Ifugao

Not Indicated

Proper procurement process was not followed in the repair of vehicle and retention money was not deducted for warranty contrary to RA No. 9184.

DOH

EU-HSPSP II

243.613 Non-liquidation of fund transfer to Implementing Agencies (IAs), contrary to COA Circular No. 94-013 dated December 13, 1994.

WHO UNICEF

7.094 0.393

Fund transfer to nine implementing agencies remained unliquidated for six to nine months due to non-monitoring of project status by program managers.

DPWH

RIIDP 1.280 Unrecouped cash advances from completed projects. This should have been recouped from the progress billings of the contractor.

j) Enforce

compliance/settlement of the

audit disallowances and

comply strictly with the

provisions of COA Circular

2009-006 dated September

15, 2009 and COA

Resolution No. 2015-031

dated August 20, 2015, as

amended by COA Resolution

2017-021 dated November 3,

2017.

k) PPMIU to require the

Provincial Engineering Office

to ensure that all required

information in the Project

Signboard be provided and

updated; and in the

prescribed size that can be

clearly seen by the public.

(DA/PRDP)

l) Municipal Accountant to

effect the transfer of interest

income from CY 2015 to CY

2017 totaling P15,523.67 to

the General Fund and

prepare correcting entry to

reflect the interest income

earned on June 2017 in

relation to IREAP.

(DA/PRDP)

m) Direct the PPMIU to secure

immediately a copy of the

MOA from the DA to ensure

that PRDP transactions are

legal and valid. (DA/PRDP)

n) Charge the salaries of the

Administrative Officer and

Assistant against the grant

component instead of the

local counterpart of the

“Muyung Fund” pursuant to

65


IA Project Amount

(Million P) Remarks

This is outstanding for more than one year.

KC-NCDDP– ADB, WB, Additional Financing & JSDF Grant for CEDPPP

Not Indicated

The completed infrastructure projects under the KC-NCDDP, KC-NCDDP Additional Financing and JSDF-CDED SLP as of December 31, 2017 were not immediately made available in the agency’s website, contrary to Section 92 on Transparency in Infrastructure Projects per GAA, thus, depriving the right of the people to information on matters of public concerns at the least possible cost on public funds.

KC- NCDDP ADB & WB

5,109.00 The non-liquidation of fund transfers to various NGOs/POs and the pending/unrecorded liquidations with Community-Beneficiaries and KC-NCDDP Field Offices Finance resulted in the minimal settlements, long outstanding accounts, and accumulation of the account balance as at year-end contrary to Sections 5.3 and 5.4 of COA Circular No. 2007-001.

DSWD KC- NCDDP

448.357 Capital expenditures of infrastructure projects were categorized in the budget proposals of DSWD as MOOE instead of Capital Outlays, thus, capital expenditures were accounted as Subsidies-Others, contrary or inconsistent with the state policy on the preparation/ formulation of budget proposal that harmonize budgetary and accounting code classification of government expenditures.

4Ps 10,746.00 Funds transferred to the LBP of P183.357 billion for OTC payments to the 4Ps beneficiaries has unliquidated balance of P10.746 billion as of December 31, 2017, of which P4.655 billion or 43.32 percent represents fund transfers from CY 2012 to 2016, thus, not in keeping with Section V-B, paragraph 8 of DSWD and

the Grant Agreement and the

itemized budget; (DA/PRDP)

o) Property Officer to determine

the Accountable Officers who

are in possession of the PPE

procured under DFIMDP.

(DA/DFIMDP)

p) Issue PARs every time there

is change in accountability or

custodianship to actual users

of equipment and renew the

PARs issued to end-users

every three years thereafter

to properly establish

accountability over the use

and custody of the assets.

(DENR/CBFMMP)

q) Officials and employees

concerned to immediately

liquidate their cash advances

and see to it that all cash

advances are liquidated as

required upon return of

accountable officers to their

permanent official stations.

(DENR/FMP)

r) PENRO Ifugao to consider

disposing fully depreciated

vehicle and no longer

economical to maintain in

accordance with existing

regulations to avoid further

incurrence of expenses and

make representation with the

DBM for acquisition of a new

vehicle. (DENR/FMP-

PENRO Ifugao)

s) Accountant to draw adjusting

entries to reflect the correct

balance of the Due from

NGOs/POs and Financial

66


IA Project Amount

(Million P) Remarks

LBP MOA dated July 14, 2011.

DOTr CBRTP, NBACSEPP TADP, & LADP

75.19 Of the 2017 year-end aggregate balance of P535.45 million of accounts Due from NGAs, Due from GOCCs and Due from LGUs, 85.96 percent or P460.26 million was aged below one year and the 14.04 percent or P75.19 million had been outstanding for more than a year to over ten years. The liquidation of the 2016 ending balance of P88.99 million was registered at 15.50 percent or P13.80 million only as of 31 December 2017 due to dormancy of Due from GOCC and Due from NGAs prior years’ balances of P47.41 million and P10.47 million, respectively.

DAR IARCDSP 0.028 Withheld taxes of prior years were still not remitted to the BIR as of December 31, 2017, contrary to DOF, DBM and COA Joint Circular No. 1-2000.

Assistance accounts.

(DENR/ SCHARMP)

t) Project Manager/PMO to

exert all efforts by requiring

the IAs to immediately submit

liquidation/ utilization reports

as well as accomplishment

reports on funds transferred;

(DOH/EU-HSPSP II;

DOH/WHO/UNICEF)

u) Submit Inventory report of

PPEs and other documents

that form part of the phase-

out plan of the Project in

compliance with DO No.

2017-0238; Execute deed of

donation of completed

project to the recipient LGU

and coordinate with the

Accounting Division to record

partially/completed

infrastructure projects.

(DOH/ EU-HSPSP II)

v) Management to direct the

Chief Accountant to facilitate

the recoupment of advances

to contractors amounting to

P1,280,146.48 relative to

completed RIIDP contracts.

(DPWH/RIIDP)

w) FOs to issue demand letter to

organizations concerned

pursuant to the guidelines

set forth in COA

Memorandum No. 2017-010

and compel them to refund

the unliquidated amounts,

otherwise, file appropriate

legal action, if warranted;

Include in the MOA

stipulations, such as the

responsibility of the

concerned NGOs/POs to

67

Audit Observations Recommendations account and settle the funds

transferred and the legal

sanctions in case of failure to

liquidate the same; and

Require KC-Regional PMO

to fast track review and

evaluation of liquidation

documents for immediate

recording in the books.

(DSWD/KC-NCDDP-ADB &

WB)

x) DSWD FO No. XIII to prepare

its budget proposals for

capital expenditures on

infrastructure projects in

accordance with existing

budgetary policies so that

capital expenditures are

captured, from the time of

budget appropriation until

funds are disbursed, under

capital outlay accounts.

(DSWD/KC-NCDDP)

y) LBP to strictly adhere to the

provisions of the MOA and to

explain or justify the non-

release of needed cash for

the 4Ps beneficiaries, if

warranted. (DSWD/4Ps)

z) Monitor strictly the

compliance by the IAs with

the provisions of COA

Circular No. 94-013 and

MOAs on the timely

submission of liquidation

reports for fund transfers to

avoid long outstanding and

dormancy of balances of

Inter-Agency Receivables; In

cases where submission of

liquidation reports is already

nil, require the IAs to issue

certifications that the

projects funded out of the FT

68

Audit Observations Recommendations have been completed and

recognized in the books of

accounts, duly verified by

their respective COA

Auditors. These certifications

shall be used as supporting

documents in recording

liquidation in the DOTr

books; and Consider the

filing of a request for write-off

of dormant long outstanding

accounts with the COA

pursuant to COA Circular No.

2016-005 dated December

19, 2016. (DOTr/CBRTP,

NBACSEPP, TADP, &

LADP)

aa) Immediately cause the full

remittance to the BIR of all

unremitted withheld taxes

and review and analyze the

entries in the General

Ledger and prepare the

necessary adjustments.

(DAR/IARCDSP)

2. The provisions and/or requirements under the

Memorandum of Agreement (MOA) or

contract/project document or Project Operations

Manual were not strictly observed and/or not

complied with in the implementation of various

projects.

As reported by the concerned audit teams, certain

provisions in the MOA or contract/project document were

not observed in the implementation of the following

projects:

IA Project Amount

(Million P) Remarks

DA PRDP 0.253 The amount of P252,915.21 representing 10 percent counterpart of PLGU Ilocos Norte was not actually provided by MLGU Vintar, Ilocos Norte which is not in accordance with the prescribed cost-sharing stated in the IMA, thus the non-usage of the


a) PLGU Ilocos Norte to

appropriate P252,915.21

representing its share for the

Solar Drying Pavements

sub-project as stated in the

IMA. (DA/PRDP)

b) Ensure the submission of

required reports within the

deadline set to enable the

Audit Team to promptly audit

and settle the agency’s

transactions and accounts.

(DA/PRDP)

c) Make representation with the

BTr for the necessary

amendment to the pertinent

69


IA Project Amount

(Million P) Remarks

said amount.

Not Indicated

Monthly, quarterly and annual report were not submitted to the Audit Team contrary to the I-Build Operations Manual and Financial Management Operations Manual of the PRDP. (CAR/Apayao)

DBP

EDP-NW

9.268 The MOA by and between the BTr and DBP was not revisited and amended as mutually agreed upon by both parties, particularly the computation by the Bank of FXRC claims from the BTr on foreign-denominated ODA borrowings that is not aligned with the pertinent provisions of the MOA, resulting in a net overclaim for CY 2017.

The Bank did not levy penalty for all 2017 payments of FRXC claims received after 10 banking days from the BTr receipt of the billing, contrary to the provisions of the MOA by and between the NG/BTr and the DBP.

LBP ACSP Not Indicated

The Revolving Fund Account for the Agricultural Credit Support Project was not established, thus, deviating from Section 6, Article III of the Loan Agreement between LBP and JICA. The LBP, instead, used its current fund pooling system with booking/tagging mechanism capable of monitoring fund movements. In principle, the requirements of Section 6(1) of the Loan Agreement is satisfied. JICA should defer the issuance of no objection to the request pending resolution of some matters with LBP.

NFA 1995 USPL Title I Program

Not Indicated

In CY 2017, NFA has complied with the terms and conditions on payment of the principal and interest provided in the MOA. Based on the letter of Commodity Credit Corporation (CCC) submitted by Management to the Audit Team, its record is reconciled with NFA’s books.

portion of the MOA treating

on the application of

exchange rates for the

computation of FXRC claims

based on mutual agreement

by both parties. (DBP/EDP-

NW)

d) Apply the provision of the

MOA on the imposition of

penalty for payments

received after 10 banking

days from BTr’s receipt of

DBP’s billing. (DBP/EDP-

NW)

e) Pursue with JICA the

approval of the existing fund

pooling system for the

booking and monitoring of

ACSP-funded accounts to

comply with the requirement

of Section 6(1) of the Loan

Agreement No. PH-P244.

(LBP-ACSP)

f) Obtain copies of documents

from the creditor evidencing

payments made on the loans

with the corresponding

interests. (NFA/ 1995 USPL

Title I Program)

70


IA Project Amount

(Million P) Remarks

However, the afore-mentioned letter is not sufficient as it is not considered official, even the information provided therein did not substantiate all the payments made by NFA.

E. Reliability of Financial Statements

The propriety and accuracy of FS accounts of various projects cannot be established due to inclusion of unserviceable PPE and/or exclusion of other accounts, unreconciled balances and errors in recording, among others.

As reported by the concerned Auditors, the financial records of the following projects were unreliable due to the following reasons:

IA & Project Accounts Amount

(Million P) Remarks

DA/ PRDP

PPE

0.091 Damaged PPE were not yet reported as unserviceable, not yet disposed and were still carried in the books of PSO Visayas.

2.694 Non-inclusion of PPE accounts in the RPCPPE of NPCO and PSO Visayas

CIB 103.173 Absence of BRS and Ledger in PSO Mindanao

Receivables-NDs/NCs

2.333 The Receivables – Disallowances/ Charges reported is doubtful due to the existence of an unreconciled amount. (Region II)

CIB-LCCA 28.465 Twenty-four (24) unreleased commercial checks at year end were not reverted back to the cash account as of December 31, 2017 thus, understated the Cash in Bank – Local Currency, Current Account as of December 31, 2017.

Due from LGUs & CIP

75.93 Expended fund transfer still outstanding in the receivable accounts of PSO Luzon B

8.766 Unadjusted and/or unreconciled variance between the balance per books and the results of confirmation of receivable accounts in PSO Luzon B

Accounts Payable & Other Payables

15.885 Overstated due to a misclassification of account and insufficiency of supporting documents to support the validity of some claims (Region II)

Due to NGAs

0.803 Non-maintenance of SL Due to National Government Agencies (NGAs) account.

Books vs FAR

29.069 85.388

Unreconciled amounts of obligation and disbursement between PRDP NPCO report and those presented in the

Management to require concerned officials to:

a) Prepare the Inventory and Inspection Report of Unserviceable Property and submit to the Accountant for the preparation of JEV to clear the PPE accounts from unserviceable property. (DA/PRDP/SHARMP; DENR/CB FMMP)

b) Conduct physical inventory

of all properties including unserviceable property for disposal; and prepare RPCPPE to include all PPE accounts in the NPCO and PSOs and to exclude all PPE transferred to the agencies. (Various Projects)

c) Request depositary bank to

release Bank Statement on time, and Accountant to prepare BRS and corresponding adjusting entries and to submit to COA for verification of the ending balances of cash accounts recorded in the books. (Various Projects)

d) Direct the Accountant to draw a JEV to recognize necessary adjustments and to draw a JEV at the end of each year to adjust the reversion of unreleased commercial checks to the cash account at year end

71



(Million P) Remarks

Financial Accountability Report (FAR).

Inventory 0.287 Purchases of inventory items in NPCO and RPCO V were directly recognized as expense accounts contrary to the prescribed perpetual inventory item per Section 9, Chapter 8 of GAM for NGAs Volume I.

Not Indicated

Agricultural produce, supplies and materials purchased were not recorded first as inventories in the books of accounts resulting in ineffective control and misstatement of the financial statements. (CAR/Ifugao)

PPE 0.387 Irregular procurement of motorcycles

DA/ SCHARMP

Due from NGOs/ POs and Expense Account

3.350 Fund transfers treated as expense instead of recording as Due from NGOs/POs; thereby understating the account Due from NGOs/POs and overstating the expense account.

PPE 11.974 Equipment found during inspection of P0.117 million, unserviceable but remained in the books of accounts of P0.915 million equipment; and equipment transferred to other agencies which remained in the books costing P10.942 million

SCHARMP 3.350 Recorded directly as an expense instead of recording it as Due from

NGOs/POs, thereby understating the account Due from NGOs/POs and overstating the expense account

DA/ DFIMDP

PPE 2.047 Difference between property records of P12.272 million and accounting records of P10.225 million.

DA/ InfRES

Inventory 0.300 Overstated due to non-preparation of RSMI

0.264 Non-moving SL account balances since October 2014

PPE Not Indicated

Non-recording of Communication Equipment in the books of INFRES which are included in the RPCPPE and found during the physical count

DAR/ ARCP II

Receivable Accounts

11.300 Overstated due to non-reconciliation of balances with IAs; IAs not also compelled to submit liquidation reports within the prescribed period, thus, accumulating receivable balances.

Cash

Not Indicated

Non-submission of BRS for the GCF Trust Fund (Account No. 0702-1042-03) and FAPsO MDS with Account No. 2070-9015-04

Non-submission of the Statement of Comparison of Budget and Actual Amount

DAR/ ARCP II GOP and LP

PPE

12.167 Property and Equipment for Distribution and other Property Plant and Equipment (PPE) and the corresponding accumulated depreciation amounting to P1,006,663.12 were recognized in the

whenever applicable; Ensure that issuance of check and approval of related DVs are based on valid claims and duly supported with complete documentation. (DA/PRDP)

e) LGUs to fast track submission of liquidation documents to DA and other government agencies for the adjustment of account balance and for fair presentation in the books of the Due from LGUs and CIP accounts for I-Build Component and expense account for I-REAP Component.

f) Accounting and Budget Divisions to resolve the discrepancies of the fund utilization status report between the records of PRDP NPCO and in the FAR. (DA/PRDP)

g) Submit to the Accountant and to COA accurate and properly accomplished RPCPPE not later than January 31 of each year as prescribed in the GAM for NGAs. (Various Projects)

h) Accountant of NPCO and RPCO V to observe the proper accounting in the purchase of inventory items using the prescribed perpetual inventory system. (DA/PRDP)

i) Identify issues/difficulty in the submission or compliance with documentary requirements and provide technical assistance to LGUs as deemed necessary to the

72



(Million P) Remarks

books under Fund 158 and Fund 102 ARCP II-GOP and LP despite the absence of supporting documents and actual receipt of PPE and crediting Subsidy from Central Office thus, affecting the reliability of the balance of the said accounts as of December 31, 2017. (Region IX)

DAR/ CONVERGE

CIB-LCCA 4.659 Unaccounted difference between book and bank balances and non-preparation of adjusting entry/ies to reflect the said variance.

Due from Central Office & Subsidy from Central Office

5.687 Recording in the books under Fund 102-ARCP II-LP & GOP, Fund 102- Project ConVERGE funding checks not yet received by debiting Due from Central Office and crediting Subsidy from Central Office, resulting in the overstatement/ misstatement of the said accounts as of December 31, 2017 (Region IX)

Due from Operating Unit (asset account); Training Expense; &

3.817

4.522

Transactions were recorded in the books despite the absence of appropriate basis for recognition of the same, resulting in the misstatements of Due from Operating Unit (asset account) of P3.817 million; Training

Payables 7.065 Expense (expense account) of P4.523 million and Payables as of December 31, 2017 of P7.065 million. (Region IX)

Payables; Expenses; & Asset Accounts

48.018 7.268 40.750

Transactions were recognized in the books under Fund 102 despite the absence of perfected contracts/POs and actual receipt of goods and services, resulting in the overstatement of expenses for the Payables and assets as of December 31, 2017.

DARPO- ZDS/ CONVERGE

Subsidy and Due from Central Office

49.412 Recognition in the books under Fund 102-Project Converge of Subsidy from Central Office without corresponding receipt of fund overstated Subsidy and Due from Central Office.

Payable Accounts

11.954 Recording of obligations under Fund 102-Project Converge for the procurement of farm inputs/hauling trucks in favor of the DARRO IX to avoid the lapsing and reversion of unused appropriation was not in keeping with Section 11 of the GAM- Volume I.

Due from Central Office & Subsidy from Central Office

32.778 The agency recorded in its books of accounts Subsidy from Central Office (Credit) for funding checks not yet received and debiting Due from Central Office under Fund 102-Project Converge based on verbal instruction from DAR Central Office, resulting in the overstatement of the said accounts as of December 31, 2017.

maximize availment of grants. (DAR/ARCP II)

j) Accountants to draw adjusting entries to restate beginning balances or correct erroneous entry and/or reflect correct balances of PPE and Cash in Bank accounts and all other affected accounts or reclassify account to appropriate account. (Various projects)

k) Prepare and regularly

update SLs including SLs for Due to NGAs, Advances to Contractors, CIP, and PPE to support the reported balances in the books of accounts. (Various Projects)

l) Accountant to reconcile with project personnel to determine the variance/unreconciled figures and disposition and propriety of, outstanding inventory items as well as analyze the non-moving subsidiary account balances and effect adjustments, if warranted. (DA/InfRES/PRDP)

m) Management adjust and

restate the beginning balances of the affected accounts as of January 1, 2018 to reflect the correct account balances. (DAR/ CONVERGE)

n) Ensure that obligations recorded are duly supported with documents as required under existing laws and regulations. (DA/CONVERGE)

o) Stop the practice of recording Subsidy Income

73



(Million P) Remarks

DAR/ IARCDSP

Cash Not Indicated

Non-submission of the SCBAA and BRS for FAPsO MDS with Account No. 2070-9015-04

DAR/ MINSAAD

Consultancy Services

2.238 Understated Consultancy Services due to non-inclusion of the tax portions on payments of consultancy services

Duties, Taxes and Licenses

0 Overstated by the same amount due to recording of the tax portions as separate Taxes, Duties and Licenses expense

Travelling Expenses

0.039 Honoraria for the month of December 2017 recorded as Travelling Expenses.

Cash 163.432 Overstated Inter-agency Receivables Accounts due to non-reconciliation of balances with IAs and non-submission of liquidation reports within the prescribed period

DENR/ CBFMMP

PPE (Fund 102 and 171)

5.201 Absence of physical inventory and non-submission of the RPCPPE and IIRUP

CIP-LI and LI-RPs (Fund 102 and 171)

66.469 Completed projects not reclassified to the appropriate fixed asset account Land Improvement, Reforestation Projects before transferring the accounts to Fund 101

DENR/ FMP

Inventory 1.702 Unreconciled balance of P287,402.60 between the accounting and property records of Region II; and failure to conduct the physical count of inventories and to submit the RPCI in FMB and Region III

Fuel, Oil & Lubricants Expenses

Not Indicated

Non-submission of the Monthly Report of Official Travels and the Monthly Reports of Fuel Consumption. (Region 6, Iloilo)

Advances to Contractors

31.622 SLs not maintained in PENRO Iloilo, thus, reconciliation with the GL controlling account not possible

Office Equipment and ICTE

0.126 Absence of disclosure regarding the existence of one unit Nikon SLR D800 digital camera with complete accessories which was not returned by the former Assistant Secretary, FASPS and error in recording the digital camera under account Office Equipment instead of account Information and Communications Technology Equipment

DENR/ INREMP

CIB-LCCA 0.151 Unreconciled book and bank balances

DOH/ EU- HSPSPII

Inventory PPE

17.767 Non preparation of Report of Supplies and Materials (RSMI); and Property Transfer Form (PTR) for inventory issuances and property/asset transferred, as well as non-conduct of physical inventory count

CIP PPE

3.990 Completed and accepted birthing facility not yet reclassified/transferred to the appropriate PPE account

not yet received and require the Accountant to make an adjustment restating the balance of the account balances as at January 1, 2018. (DA/CONVERGE)

p) Instruct Budget Officer to prepare and submit the SCBAA to the Office of the Auditor for verification. (DAR/ARCP II/ IARCDSP)

q) Update the recording of liquidation reports submitted by the IAs; exert effort in reconciling the balances of the accounts with the IAs (NGAs and GOCCs); and Issue demand letters to concerned IAs to liquidate funds utilized or refund unutilized amount of completed projects. (DAR/ARCP II/MINSAAD)

r) Accountant to adhere to

applicable laws in the proper recording of transactions. (DAR/MINSAAD; DA/SCHARMP)

s) Request from the Implementing Agency/Contractor/End-users, submission of final report/required documents as basis for reclassifying the account CIP-Land Improvement to appropriate account. (AVIAN, 2WHSMP and BIP-RIOC401-NTCCO Phase II)

t) Exert efforts in retrieving the digital camera by sending demand letters to the former DENR official for the return of the equipment; Provide necessary disclosure in the Financial Statements regarding the status of the equipment, nature of prior

74



(Million P) Remarks

16.064 Non-recording of partially and completed infrastructure project due to failure to prepare inventory of PPE

AVIAN, 2WHSMP and BIP- RIOC401- NTCCO

Inventory PPE

12.059 26.110

Non-preparation/maintenance/ submission of reports of issuances and non-proper turn-over of previous Property Officer, deterring also the closure of the books of accounts

Phase II CIP 9.449 Non-submission of Certificate of Completion by the IAs and Acceptance of the end-users of completed constructions projects

MWSS – NWSDP, UATP & MSSP

CIP 759.297 Completed projects not transferred to appropriate asset account and inclusion of unreconciled accounts

DOTr PPE 25.673 Errors/omissions in recording of transactions; non-conduct of physical count of properties; non-submission of Report on the Physical Count of (RPCPPE) and non-maintenance of PPE Ledger Cards (PPELCs)

DPWH NRIMP PII

Cash and Cash Equivalents

Not Indicated

Non-preparation of periodic BRS

POPSTIRP DPWH NRIMP

PPE 375.192 PPE accounts misclassified as Construction in Progress – Buildings and Other Structures

PII POPSTIRP

Intangible Assets

61.183 Recorded in the book at zero net book value for project G-07 Database Management System, computer software due to the practice of using an estimated useful life of five (5) years for its intangible assets

DPWH/ RIIDP

RUPP

CIP-IA 155,879.670 Due to various errors/omissions and existence of unreconciled balances amounting to P23.072 billion

PMRCIP PIII

NRIMP PII ARBP II

Accounts Payable

12,857.511 Due to non-reversion of long outstanding/ undocumented payables and unrecorded direct payment to contractors/ consultants by the FLI

FRMP MMICP VI CLLeX MPBSIP

Due to BIR 43.809 Unremitted taxes withheld and existence of negative SL balances representing amount remitted for taxes withheld without setting-up the account, double remittance of taxes withheld and amount still for reconciliation by the Accounting Division.

NIA PIDP

Various Accounts

136.14 Undisclosed prior period adjustments made to correct prior period errors which restated some account balances in CY 2015 in the Notes to Financial Statements contrary to Philippine Public Sector Accounting Standards (PPSAS) No. 3

Accum. Depreciation

7.66 Difference between the depreciation for the year presented in the Statement of Financial Performance (SFP) of P23.209 million and the amount of

period errors and amount of correction for each line item affected. (DENR/FMP)

u) Submit immediately the Monthly Report of Official Travels with the corresponding Reports of Fuel Consumption to the Audit Team for verification of the recorded Fuel, Oil & Lubricants Expenses and henceforth, within a reasonable period every month thereafter; and Advise the designated drivers of the agency to properly accomplish the trip tickets. (DENR/FMP)

v) Supply and Property Division to consistently/regularly prepare the RSMI and PTR for every issuance of inventories and transfer of properties. (DOH/EU-HSPSPII; DA/InFRES)

w) Review and analyze the cost

of completed projects and make necessary reclassification to the appropriate PPE accounts, supported with Certificate of Completion and Acceptance, and compute for the Accumulated Depreciation of the six Completed Projects from the year of completion. (Various Projects)

x) Chief Accountant to review the useful life of intangible assets at least each reporting period to determine if expectations differ from previous estimates in accordance with Section 11, Chapter 12, Volume I of the GAM. (DPWH/NRIMPPII)

y) Analyze and review non-moving SL accounts

75



(Million P) Remarks

provision of depreciation presented in the Notes to Financial Statements No. 8 – PPE of P30.872 million. The variance indicates that an adjustment was made in the accumulated depreciation for CY 2015 but the balance was not restated

NIA PIDP

Various Accounts

233.73 Difference between the reported amounts of funds received, fund utilized and fund balance of P26.537 million, P132.120 million and P75.076 million, respectively, in the Statement of Sources and Application of Funds (SSAF) and in the Financial Statements; The Statement of Comparison of Budget and Actual Amount was also not prepared contrary to PPSAS No. 1

PPE 1,423.69 Non-inventory taking of PPE costing P37.346 million, variance of P27.07 million between the result of physical count and recorded PPE, non-allocation of overhead cost of P86.875 million to CIP and Water Systems accounts, and absence of documents to support the transfer of equipment in the amount of P34.164 million to NIA offices

CIB-LCCA 7.89 Non-submission of documents supporting the BRS, discrepancy between book balance and the corresponding bank statements, and non-adjustment of reconciling items. (Regions III, IV-B and XI)

including Payable Accounts and revert balances outstanding for two (2) years or more, undocumented and without valid/ actual claimants, pursuant to Section 98 of PD 1445 and EO 109 dated June 10, 1999; and make representation with the DBM, aside from sending follow-up letters, for immediate issuances of the NCAA to facilitate recording of direct payments made to contractors/ consultants. (DPWH/RIIDP, ARBP II, FRMP, MMICP VI, RUPP, CLLeX, MMPBSIP; DA/InFRES)

z) Remit amounts due to BIR;

Analyze and reconcile negative balances in SL accounts and review the records of taxes withheld/ remitted. (DPWH/ NRIMP PII CLLeX)

aa) Accounting Division of Central and Regional Offices to reconcile records with Foreign Loan Accounting Division (FLAD) and PIDP PMO and make necessary adjustments in the books of accounts and FLAD and PMO reports. FLAD and PMO to prepare statement of comparison of actual expenditures against the approved budget per project component. (NIA-Various accounts)

bb) Reconcile the depreciation

amount reflected in the SFP and the Notes to FS (NIA-Accumulated Depreciation).

cc) Allocate management fee and general engineering supervision and

76


administrative cost to various projects implemented; and

dd) Submit Invoice Receipts and PARs or AREs covering equipment transferred by CO to various NIA offices and Property Division to submit to Accounting Division certified true copies of Invoice Receipts for all assets transferred. (NIA-PIDP)

4.2 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:

4.2.1 For the Implementing Agencies

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; 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; Exert best efforts to comply with loan conditionalities within the prescribed period/target date to facilitate project start-up activities; 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; Maintain the required accounting records and reconcile reciprocal and related accounts including cash account and bank balances; Conduct regular physical inventory of supplies and equipment and reconcile accounting and property records.

4.2.2 For the Oversight Agencies

4.2.2.1 National Economic Development Authority

4.2.2.1.1 Sustain the review of necessity of projects, project design and implementation strategies, and absorptive capacity of implementing agencies to undertake and sustain/maintain; and

77

4.2.2.1.2 In the review of project feasibility studies, consider lessons learned

from similar projects as aid in determining project design deficiencies and viability of the project.

4.2.2.2 Department of Finance

4.2.2.2.1 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;

4.2.2.2.2 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

4.2.2.2.3 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.

4.2.2.3 Department of Budget and Management

4.2.2.3.1 Ensure adequate and timely release of project funds, both loan/grant

proceeds and GOP counterpart funds;

4.2.2.3.2 Consider inclusion of debt service and commitment fees against implementing agencies’ budget for proper accountability and reporting of expenditures; and

4.2.2.3.3 Release immediately the Non-Cash Availment Authority to facilitate the recording of settlement of liabilities for goods delivered and services rendered.

4.3 Status of Implementation of Prior Years’ Audit Recommendations

Out of the 586 prior years’ (PYs) audit recommendations included in prior years’ Consolidated Annual Audit Reports of 32 National Government Agencies (NGAs), Government Owned and Controlled Corporations (GOCCs), and Local Government Units (LGUs), 250 or 43 percent were implemented, 188 or 32 percent were partially implemented or implementation in-progress, 66 or 11 percent were yet to be implemented, while status of implementation of 82 or 14 percent are still for verification, as presented in Table XXX.

78

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/non-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;

consolidated audit report on the official development ......awol absent without leave bac bids and...

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