EXECUTIVE SUMMARY OF THE
1998 ANNUAL AUDIT REPORT ON THE
TONDO MEDICAL CENTER
Tondo Medical Center was the former Tondo General Hospital
and Medical Center created under Republic Act No. 6375 in 1971. Its operations
are under the supervision of the Executive Committee of the Office for National
Field Operations, Department of Health. It is mandated primarily to give free
in-patient and out-patient medical care to as many residents of the District of
Tondo, City of Manila, as possible.
For 1998, the Center had undertaken the following:
Attained a bed occupancy rate of 78.10% of 73,000 or
57,017 in- patient days and attended to 65,089 out-patient
Attended to 35,778 emergency cases; and
Generated income amounting
hospital service fees, and other miscellaneous sources.
For 1998, the Center received total allotments of
P133,256,812.40 in addition to the continuing appropriations of
It incurred total expenditures of P167,440,526.16, thus leaving an unobligated
balance of P38,311,042.42 at the end of the year.
The Center's assets, liabilities, residual equity and income
for 1998 were
P126,434,291.97 and P7,606,053.59, respectively.
Scope of Audit
The audit covered the operations of Tondo Medical Center for
1998. The objectives of the audit were to ascertain the fairness and reliability
of the Center's financial position and results of operations, and to determine
whether the plans, programs, projects and activities for the year were attained
in an efficient, economical and effective manner. The result of efficiency,
economy and effectiveness audit is covered by a separate Value For Money Audit
Report. We also conducted compliance audit and checked the validity and
propriety of transactions using the Simplified Sampling Scheme (SSS) provided in
COA Resolution No. 95-505 dated July 4, 1995.
Opinion in the State Auditor's Report on the Financial Statements
The Auditor rendered a qualified opinion on the fairness of
presentation of the financial statements for failure of the agency to reconcile
the balance of inventory report for P69,970,415.85 with recorded book value for
P60,318,500.23 or a difference of P9,651,915.62 and to booked-up donated
equipment and those transferred from other government agencies.
Summary of Significant Findings and Recommendations
For the exceptions cited above, the Auditor recommended that
management should reconcile the inventory report with the accounting records to
correct the discrepancy. Also, book-up donated equipment and those transferred
from other government agencies. In addition, the following are other significant
Procurement of supplies amounting to
P1,775,966.66 in 1998
were charged to the 1996 allotment for Maintenance and Other Operating
Expenses (MOOE) and Capital Outlay (CO). Stop the practice of certifying to
accounts payable non-existing obligations to avoid criminal and administrative
prosecution for illegal transactions.
The installation of New Elevator System at T.M.C. which
is under contract with KPI Elevators Inc. at a contract cost of
is not covered by sufficient funds in violation of Section 85 of PD 1445.
Conduct detailed engineering investigations, surveys and plans considering the
funds allocated for the project. Advertised in the newspapers the invitation
to prequalify and to bid and process the bidding and award within the time
frame as provided in the IRR of PD 1594 and AO No. 129 dated May 16, 1994 so
that contract agreements could be executed and perfected before the lapse of
the validity period to incur obligation for the fund allocated for a project.
Also, request DOH-Infra to report the violation committed by the contractor to
the Contruction Industry Authority of the Philippines (CIAP) fro blacklisting
of the contractor.
ER Sagun Construction, Inc., the contractor-awardee for the
construction of Laundry/Linen and Supply Building abandoned the prosecution of
the work on the project after payment of the second progress/billing for
accomplishment as of June 5, 1998. Forfeit the performance and surety bonds
posted by the contractor and thereafter take over the prosecution of the
project or award the same to a qualified contractor through a negotiated
contract. (Sec. CI 8-3 IRR, as amended of PD1594). Also, request DOH-Infra to
report the violation to Construction Industry Authority of the Philippines
Losses of property are not being reported to the
Auditor. File immediately the "Notice of Loss" to the Auditor upon
discovery of loss of property and within thirty days apply for relief from
accountability for the loss with all the required supporting documents, as
applicable which is enumerated in Sec. 499, Vol. I GAAM, pursuant to Sec. 73,
PD No. 1445. Otherwise, accountable officer will be held personally liable for
Unserviceable vehicles amounting to
remained undisposed, hence, decreasaing the corresponding salvage value of
these properties. Dispose the unserviceable vehicles in any of the mode of
divestment provided in Sec. 503, Vol. I GAAM to relieve the officer
accountable therefore pursuant to Sec. 79 of PD 1445.
Special Allotment Release Order's received to cover use
of income by T.M.C.were mixed with the regular allotment and sub-allotments
from Department of Health, thereby, making it difficult to identify which
allotment is over obligated. Comply strictly to the required procedure of
recording allotments to monitor properly obligations incurred and thereby
avoid over expenditures.
Bills rendered were not taken up in the books of
accounts resulting in the understatement of the current assets. Record in the
books of accounts all receivables from information furnished by operating
The T.M.C. do not have covered garage to park/house its
motor vehicles which will result in faster wear and tear of the vehicles due
to constant exposure to the elements. Undertake the construction of a covered
garage/motorpool to house all vehicles to protect them from the elements and
thereby prolonged their useful life.
Financial Reports and statements were not submitted on
time consequently affecting timely audit action on the matter. Direct the
accounting officer to comply strictly to the time frame of submission of
financial reports and statements pursuant to Sec. 100, PD1445 and COA Circular
No. 95-006 dated May 18, 1995, as amended.
Part-time Medical Specialist do not indicate the time
of arrival and departure on the day service was rendered in CSC Form No. 48
and only a few indicate their time in the log sheet but only their time of
arrival contrary to CSC Memo. Circular No. 14, 2. 1992. Direct Part-Time
Medical Specialist to comply strictly to the keeping of their records of
attendance in order to determine that they have properly complied with
required twenty hours a week service and to properly compute the number of
hours of vacation and sick leaves that they are entitled to, and also the
number of hours tardiness were incurred.
As of December 31, 1998 suspensions in audit amounted
P7,190,862.62 while disallowances and charges totaled
P25,166,576.05 and P3,937.90 respectively, and none was settled/adjusted in violation of Section
9.1 of the Revised Manual on Certificate of Settlement and Balances. Enforce
immediate settlement of suspensions, disallowances and charges totaling
P7,190,862.62, P25,166,576.05 and P3,937.90 respectively, pursuant to Section
9.1 of the Revised Manual of C.S.B. Thereafter, ensure compliance with
auditing rules and regulations before processing claims/effecting payments to
minimize suspensions, disallowances and charges in audit.
The above cited together with the other findings and
recommendations were discussed with the head of the office and other concerned
officials of the Auditee. Management's views and reactions were considered in
the report, where appropriate.
Status of Implementation By the Auditee of Prior Year's Audit Recommendations
Of the five audit recommendations embodied in the 1997 Annual
Audit Report, three were partially implemented and the remaining two were not
implemented by the hospital.
For the 1996 audit recommendations, three were fully
implemented, one was partially implemented and two were not implemented.
For the 1995 audit recommendations four was fully
implemented, one was debited and included in 1998 and three were not
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