COA to Baguio City: Explain P4.429 billion in time deposits
MANILA, Philippines – The Commission on Audit (COA) is asking the local government of Baguio City to explain the existence of time deposits and high yield savings accounts (HYSA) containing a total of P4.429 billion.
State auditors discovered this amount spread out in at least 26 bank accounts — 17 with the Land Bank of the Philippines (LBP) and seven with the Development Bank of the Philippines (DBP). The LBP accounts hold P3.317 billion while those with DBP contain P1.112 billion in deposits, according to the 2023 annual audit report of Baguio City released on December 1, 2024.
COA said that “comparative year-end balances… as reported in the financial statements [from CY 2018 to 2023] has significantly increased.” The city’s time deposits was only at P2.721 billion in 2018 but grew to P3.288 billion in 2019, before hitting P4.429 billion by year end of 2023.
This amount also exceeded the authorized idle fund amounting to P695 million to be invested for the first semester of 2024 — an excess of P3.734 billion. The money, COA said, was supposed to be for current liabilities as well as operating expenses for 2024. This meant that there was an “accumulation of liabilities” and unsettled obligations.
The commission also found that P1.877 billion of the total amount came from a funding that was allotted for the city government’s priority development projects. Baguio City only spent P293 million for these projects in 2023.
State auditors pointed out that the deposits had a .65% to 1.75% current interest rates with maturity dates between 63 to 182 days which were “way lower than the minimum agreed interest of 7.5% required” as stated under the Sangguniang Panlungsod Resolution No. 282 released in 2001.
In response to these findings, the city government of Baguio said that it will comply with the recommendations that included using the excess amount found in time deposit investments in settling existing liabilities and unpaid obligations.
It, however, appealed for an extension and wait for the accounts to mature before termination. – Rappler.com