Aurora limps with P127-M cash deficit, P315-M debtsJuly 18, 2013 8:16 pm
AURORA province apparently is in want of managers with money savvy. An audit team from the Commission on Audit (COA) found that “the province’s poor financial management” resulted in the accumulation of P315.94-million debts by 2012.
Too, insufficient cash backing or “cash deficit” hit P127.37 million by 2012 yearend.
In detail, total cash available of Aurora’s General Fund and Trust Fund showed negative figures. General Fund had negative P87.52 million, while Trust Fund totaled negative P41.78 million.
Only the Special Education Fund stood strong at P1.93 million, leaving a total overdraft of P127.37 million.
Auditors commented that public and social projects would suffer because of Aurora province’s financial crunch.
“The insufficiency of cash to support the province’s expenditures had an adverse effect in the delivery of public services, that is, most of the planned activities included in the appropriation were not performed, executed or delivered within reasonable time,” the audit team raised.
In 2011, Aurora already incurred cash overdraft of P86 million in the General Fund, resulting in the payments of prior years’ liabilities in 2012.
“[Payments] were charged to the current year’s income or realized revenues. Thus, current year’s collections were mostly used to pay out prior years’ obligations,” Commission on Audit reported.
This resulted in the snowballing of “huge unpaid obligation” incurred in 2012.
The audit team also found out that the province’ revenues were spent “mostly for administrative expenses.”
“Thus, [this] leaves minimal funds for the implementation of significant programs and projects,” COA noted.
Personal services amounted to P27.52 million, or 56 percent of the total revenues—or 20-percent higher than the 45-percent limitation set by law.
They added that without a “concrete remedy” to mitigate the cash deficit, it might defeat a reliable budgeting system.
Auditors asked Aurora officials to adopt austerity measures to “improve cash position.”
The finance committee of the province is likewise recommended to advise provincial officials to iron out annual expenditures, spending ceiling for economic, social, and general services and proper allocation of expenditures.
The provincial capitol agreed “to exercise prudence in fiscal [measures]” considering that COA’s audit observation has already been raised in 2011, when Aurora “failed to provide a remedy or solution and the recurrence of similar situation.”
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