Cebu City taxpayers may have reason to pause as the Commission on Audit (COA) flagged several financial and operational concerns in the 2024 audit of the city government, including questionable spending, unrecorded assets, and delayed development projects.
The audit, recently released by COA Regional Office VII, highlights gaps in transparency and project implementation that directly affect the daily lives of Cebuanos.
The independent auditor issued a qualified opinion on the city’s 2024 financial statements. While the city’s books were found to “present fairly” its overall financial position, COA noted several exceptions that compromise reliability and accountability.
Among the key findings, COA highlighted major expenditure discrepancies.
The report stated that P11.18 billion reported in the “Actual Amounts” column of the budget was based on obligated amounts rather than actual disbursements, a practice COA said undermines transparency and accurate financial reporting.
Inventory and asset accounts also raised concerns. COA could not fully verify P4.25 billion in reported inventories and property, plant, and equipment (PPE) due to incomplete physical counts and unreconciled differences exceeding P1.46 billion.
Unrecorded donations and revenues added to the financial gaps. Donated assets—including four patrol motorcycles and 11 working dogs for the city’s K9 unit valued at nearly P26 million—were not reflected in the books.
Deferred revenues from real property taxes worth P340 million were also unrecognized.
The audit further revealed incomplete disclosure of legal and financial liabilities. Three pending court cases totaling P13.07 million were not properly recorded, while subsidiary ledgers for four city officials showed negative balances totaling P8.32 million, creating misleading financial information.
Operational concerns affecting city development and services were also flagged. Only 7.4% of the Local Development Fund—P290.81 million of the P3.91 billion allocation—was spent on priority projects, delaying community initiatives.
Waste management gaps were noted as well, with hauling and tipping fees totaling P407.77 million exacerbated by underutilized Materials Recovery Facilities (MRFs) and weak enforcement of waste segregation at source.
Cash handling inconsistencies were observed, with some collections not deposited on time, exposing city funds to possible loss or misappropriation.
To address these issues, COA recommended that city officials strengthen project planning, monitoring, and screening to ensure only procurement-ready initiatives are approved.
The agency also urged the expansion and activation of MRF operations in barangays, implementing incentives to encourage community participation in waste management, and ensuring proper reconciliation and timely deposit of all city collections.
Audit suspensions and disallowances from 2024 totaled nearly P1.26 billion, with many prior audit recommendations still unimplemented.
Of 174 recommendations from previous years, 102 remain pending, signaling ongoing compliance gaps.
COA emphasized that these findings are crucial for city leadership—not just for regulatory compliance—but for the effective delivery of public services and projects that directly impact Cebu City residents. (LLP)
