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The Bureau of Customs (BOC) has already undertaken measures to comply with recommendations in the Commission on Audit’s (COA) 2018 audit report.

BOC Internal Administration Group deputy commissioner Donato B. San Juan said that of the 37 COA audit observations and recommendations, the customs bureau has been able to comply with 23.

The agency also created an inventory team tasked to reconcile its 2012 inventory report, which has affected the 2018 financial statement. Issues have been addressed “not only in compliance [with] the COA [suggestions], but most importantly, to fix the BOC records and to reconcile its PPE [property, plants and equipment] listing against actual inventory, among others,” according to the BOC’s Internal Audit Service.

In its 2018 annual audit report of BOC, COA said the customs bureau was unable to provide adequate evidence to support certain transactions and account balances, as presented in its consolidated financial statements as of December 31, 2018, particularly on dormant and unreconciled balances of assets and liabilities accounts, including deficiencies recorded in the lodgment and assessment of entries in its electronic-to-mobile (e2m) system.

The COA report said a review of the customs bureau’s accounts showed, among others, various accounting errors/omissions and deficiencies amounting to P4.516 billion and P10.222 billion, respectively, which affected the fair presentation of the agency’s reported total assets, liabilities, and accumulated surplus/deficit for 2018. Records likewise disclosed accounts in BOC’s FS as of December 31, 20118 that are “erroneously misclassified.”

COA added that the accuracy and completeness of recorded revenue collected from duties and taxes amounting to P602.988 billion could not be determined due to non-recording of all entries coursed through the value-added service providers (VASPs). COA noted that according to interviews, BOC’s e2m system does not have a facility to check the completeness of entries forwarded by VASPs, unless the ports reconcile submitted manifests against e2m entries.

COA also observed that BOC has unreliable PPE accounts, recorded at P9.887 billion, because required records and supporting documents were not maintained.

Aside from the findings in its FS, the COA report also found that as of December 31, 2018, a total of 6,985 overstaying containers remained undisposed of in various BOC ports for a period ranging from more than 30 days to 25 years in violation of the relevant provision of the Customs Modernization and Tariff Act (CMTA).

The COA report also noted that 97 out of 375 samples cargoes were released even without complying with all of the requirements, and before a release instruction was given and contrary to established rules and regulations.

The audit body said the 97 were released without paying the additional PMS (post modification of single administrative document) assessment totalling P5.101 million.

“At the MICP (Manila International Container Port), 104 Import Entries of Imported Motor Vehicles costing P104.621 million were processed and released to importers even in the absence of a Certificate of Authority to Import (CAI) and Release Certificate (RC) from the Department of Trade and Industry (DTI),” COA said.

“In PoM (Port of Manila), containers totaling 105, with an estimated value of P69.68 million, subjected to Alert Orders, were illegally released without proper authorization,” COA added.

Last May, Guerrero ordered the immediate disposal of seized, abandoned, forfeited, and overstaying cargoes at ports as BOC put more effort into tapping non-traditional sources of revenues.

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