EXECUTIVE SUMMARY
Introduction
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:
1) Attained a bed occupancy rate of 78.10% of 73,000 or 57,017 inpatient days and attended to 65,089 out-patient
2) Attended to 35,778 emergency cases; and
3) Generated income amounting P7,606,053.59 from 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 P72,494,756.18. 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
P252,959,873.18, P126,525,581.21, 126,434,291.97 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
findings:
1) 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.
2) The installation of New Elevator System at T.M.C. which is under contract
with KPI Elevators Inc. at a contract cost of P4,078,289.19 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.
3) 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
(CIAP).
4) 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 lost property.
5) Unserviceable vehicles amounting to P458, 493.29 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.
6) 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.
7) 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 units.
8) 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.
9) 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.
10) 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.
11) As of December 31, 1998 suspensions in audit amounted to 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 implemented.