The Commission on Audit (COA) flagged the delayed liquidation of cash advances involving 16 accountable officers of the Iloilo City Government, with unutilized funds amounting to approximately ₱1.476 million that were not promptly refunded after the completion of the activities and travel for which the money was released.
In its audit findings for calendar year 2025, COA warned that the delayed return of public funds restricted the availability of government resources and exposed the money to the risk of misuse or misapplication.
The audit report’s narrative placed the unrefunded balance at ₱1,476,473.04. However, its Table 2 listed a total of ₱1,475,835.79, leaving a discrepancy of ₱637.25 that requires reconciliation.
The table showed that ₱1,257,473.04 had already exceeded the prescribed liquidation deadline, while another ₱218,362.75 remained unliquidated as of December 31, 2025, despite still being within the prescribed period.
Of the overdue amount, ₱1,255,755.88 involved 12 special-purpose cash advances, while ₱1,717.16 involved four travel-related advances. The table separately listed ₱141,568 in special-purpose advances and ₱76,794.75 in travel advances that were still within the prescribed period but had not been liquidated by year-end.
The figures highlight the need to establish the individual amounts attributable to each accountable officer, determine whether the outstanding balances were subsequently refunded, and verify whether the city enforced the prescribed liquidation rules.
Existing policy failed to prevent delays
COA Circular No. 97-002 requires accountable officers to submit liquidation reports as soon as the purpose of a cash advance has been served. Unused balances must be refunded promptly, and cash advances, except for petty cash funds, must be fully liquidated at year-end.
During the audit, the accountable officers cited several reasons for the delays, including the extended holiday period, errors in per diem claims, discrepancies in bus ticket rates, and the inclusion of ineligible beneficiaries in liquidation reports.
Other reported causes included delays in the inspection of purchased goods and supplies by the General Services Office and beneficiaries’ failure to claim their honoraria or prizes, which held up the preparation of liquidation documents.
Some officers also said they were waiting for the City Accountant’s Office to finish reviewing their liquidation reports and determine the final amount to be refunded. They explained that certain supporting documents and expense items had been disallowed or adjusted during the review.
COA rejected this practice, emphasizing that the refund of unused cash advances must be made simultaneously with the submission of the liquidation report. Officers do not need to wait for the City Accountant to complete the review before returning the unused balance.
Any deficiencies subsequently identified by the Accounting Division can be addressed through additional documents or refunds.
Accountability questions extend to management
The findings also raised questions about the implementation of the city’s existing cash-advance policies.
According to the report, the City Accountant said the city already had a policy requiring immediate liquidation. The office also periodically issued demand letters to personnel with outstanding balances and warned that their salaries could be withheld for noncompliance.
Despite these measures, delays persisted.
The issue therefore extends beyond the failure of individual officers to meet liquidation deadlines. It also concerns whether the city government consistently monitored outstanding advances, enforced its existing rules, and ensured the timely recovery of unused public funds.
COA cautioned that delayed refunds leave public money in the possession of accountable officers even after the funds are no longer needed for their intended purposes. This weakens financial controls and potentially exposes government resources to irregular use.
However, the audit findings cited in the report do not establish that the entire amount was stolen, lost, or misappropriated.
The supplied audit pages also do not identify the 16 accountable officers individually or specify how much each officer was responsible for. Their names, individual balances, and subsequent compliance must be established through the detailed audit schedules and related accounting records before personal responsibility can be determined.
COA orders tighter monitoring and enforcement
To address the deficiencies, COA recommended that the City Treasurer and City Accountant periodically monitor cash advances and liquidation reports, issue demand letters to officers who fail to comply with the prescribed deadlines, and impose salary withholding when necessary under applicable rules.
The audit body also recommended that the Internal Audit Service Office formulate stronger controls and policies governing the granting and liquidation of cash advances.
In addition, accountable officers were directed to stop waiting for the Accounting Division’s review before refunding unused funds.
The report stated that city management agreed to the recommendations and committed to recirculating its existing cash-advance policy and strictly implementing it beginning in calendar year 2026.
The supplied pages, however, do not establish whether the promised measures have been fully implemented or whether all the balances have since been refunded.
Refunds and enforcement remain key questions
The next step in establishing accountability is to determine the current status of the reported balances and whether the city government has recovered all unused funds.
The detailed schedule of cash advances, liquidation reports, official receipts for refunds, and records of demand letters or salary-withholding measures would help establish which officers have complied and whether management has acted on the audit recommendations.
The discrepancy between the narrative total and the table also needs to be reconciled to ensure that the amount reported publicly accurately reflects the underlying accounting records.
Ultimately, the audit finding points to a basic public-finance obligation: money advanced for government activities must be properly accounted for, and any unused balance must be returned within the prescribed period.
For Iloilo City, the accountability test is whether the reported delays have been corrected, the public funds recovered, and the existing rules enforced consistently enough to prevent arecurrence.
