Republic of the PhilippinesCOMMISSION ON AUDIT

Office of the AuditorPhilippine Statistics Authority

INDEPENDENT AUDITOR'S REPORT

The National Statistician and Civil Registrar General

Phi[ippine Statistics Authority

1ast Avenue, Quezon Citx

We have audited the accompanying financial statements of the Philippine Statislics

\uthority (PSA), which comprise the Statement of Financial Position as at December 31

2016, and the Statement of Financial Performance, Statement of Changes in Net

Assets/Equity, Statement of Cash Flows, Statement of Comparison of Budget and Actual

Anount for the year then ended, and a summary of significant accounting policies and

other explanatory information.

Management s Responsibility br the Financial Statements

Management is responsible for the preparation and fair presentation of these financial

statements in accordance with the Philippine Public Sector Accounting Standards

(PPSAS), and for such internal control as management determines is necessary to enable

the preparation of financial statements that are free from material misstatement, whether

due to fraud or error.

Auditor s Responsibility

Our responsibility is to express an opinion on these financial statements based on our

audit. We conducted our audit in accordance with the Philippine Public Sector Standards

on Auditing. Those standards require that we comply with ethical requirements and plan

and perform the audit to obtain reasonable assurance that the financial statements are free

from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and

disclosures in the financial statements. The procedures selected depend on the auditor's

judgment, including the assessment of the risks of material misstatement of the financial

statements, whether due to fraud or error In making those risk assessments, the auditor

considers internal control relevant to the entity's preparation and fair presentation of the

financial statements in order to design audit procedures that are appropriate in the

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circumstances, but not for the purpose of expressing an opinion on the effectiveness of

the entity's internal control. An audit also includes evaluating the appropriateness of

accounting policies used and the reasonableness of accounting estimates made by

management. as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to

provide a basis for our qualified audit opinion.

Basesjbr Qualified Opinion

1. Out of the Y1.260 billion Property, Plant and Equipment (PPE), R1.191 billion PPE

accounts of the CO and 10 ROs were unreliable due to: (a) erroneous

capitalization/recognition of expenses as Buildings account, erroneous recognition

of Construction in Progress-Building and Other Structures (CIP-BOS) account

instead of CIP-Land Improvements (CIP-LI) and incorrect recognition in the CIP-

BOS account in the CO; (b) inclusion of lost/missing PPE in the Report on the

Physical Count of PPE (RPCPPE) in NCR; (c) non-recognition of PPE transferred

from CO to NCR, ROs I and IX; (d) inclusion of semi-expendable assets with value

of less than P15,000.00; (e) purchased PPE were recorded as supplies expenses in

the books of RO II; (f) non-reconciliation of the accounting and property records in

ROs VII, IX and XII; (g) non-disposal of unserviceable PPE in NCR, ROs VI and

XIII; (h) non-conduct of physical inventory of PPE, and non-

preparation/submission of the RPCPPE in ROs I, 111, VI, VII and XII; (i) non-

maintenance of PPE Ledger Cards (PPELCs) and non-updating of Property Cards

(PCs) and PPELCs in NCR, ROs 1, VI, and FX.

2. The regularity and validity of the disbursements in the CO of P496.521 million out

of the P585.726 million recognized under the account Other MOOE as of

December 31, 2016 is doubtful due to the non-submission of the JEVs and

supporting documents for transactions amounting to P472-276 million and the non-

attachment of supporting documents such as Disbursement Vouchers (DVs) and

Payroll amounting to P24.245 million, contrary to Section 4(6) of PD 1445, COA

Circular Nos. 2012-001 and 2015-007 dated June 14, 2012 and October 22, 2015,

respectively.

3. Of the P88.284 million recognized as Due from GOCCs account as of December

31, 2016, P86.860 million remained unliquidated as of date despite the lapse of

almost 10 years and COA's issuance of an Audit Observation Memorandum

(AOM) pertaining to the said issue.

4. The carrying amount of the Inventory accounts of P71 135 million is unreliable due

to: (a) non-reconciliation of accounting and property records in CO, NCR and RO

Vil; (b) non-adjustment of semi-expendable assets, non-utilization of the weighted

average method in costing inventories, non-reporting of all inventories in the Report

on the Physical Count of Inventories (RPCI), non-utilization of the prescribed

Requisition and Issue Slips (RIS), Report on Supplies and Materials and Issued

(RSMI) and RPCL in NCR; (c) non-recognition of purchases as inventories in RO

2

VIII; (d) non- mnaintenance/non-updating of Stock Cards (SCs) and Stock Ledger

Cards (SLCs) in NCR, ROs II, VI, VII and IX; (e) non-conduct of physical

inventory and non-preparation/non-subrnission of the RPCI in ROs 11, I1, VI, VII

and IX; (f) non-preparation of the RIS, RSMI and RPCI and non-utilization n

Inventory Custodian Slip (LCS) in ROs II and IX.

Qualified Opinion

ln ou1r opinion, except for the effeets of the matters described in the Basis for Qualified

Opinion paragraph, the financial statenents present fairly, in all material respects tc

inancial position of the Philippine Statisties Authority as at December 3i, 2016, and its

financial performance and its cash flows for the year then ended in accordance with

PPSAS.

COMMISSION ON AUDIT

Byl

NELI A R. BARCIALState Auditor LVOIC-Supervising Auditor

April 26 2017

REPIJISLC OF -THE PHJ.IPN2NE5

PHILIPPINE STATISTICS AUTHORITY

Refcren v Nu iFASO3 t 2C

STATEMENT OF MANAGEMENT'S RESPONSIBILITYFOR FINANCIAL STATEMENTS

(conosEidated Al Funds)

.he management of PHILIPPINE STATISTICS AUTHORITV is responsible

for all information and representations contained in the accotnpanying Statement

of Financial Position as at December 31, 2016 and the related Statements of

Financial Performance, Statement of Cash Flows, Statement of Comparison of

Budget and Actual Amounts, Statement of Changes in Net Assets/Equity and

Notes to Financial Statements for the ycar then ended. The financial statements

haNe been prepared in conformity with generally accepted stat uccounting

principlesý and reflect amounts that are based on the best estirates and informed

judgnent of management with an appropriate consideration to material iy-

In this regard, management maintains a system of accounting and reporting which

provides for the necessary internai controls to ensure that ransclions Ure properly

authorized and recorded, assets are safeguarded against unauthorized use or

dispositioh and liabilities are recognized,

EVFLY F TOLENTINO LISA GRACE S. BERSALES Ph.0

S Chief, Accounting Divisitn National Staistician ad Civil Registra General

Febrary 2, 2017 Ferruary 2R 2017

Date signed Date signed

ÆF/mcAb/ngO-sp2ø

2/F TAM Buiiding.. PSA CompleX, East Avehlue, Tibman, QuezOn C'ty, PbiPPnrs1O

PH ILIPPINE STATISTICS AUTHORITY

STATEMENT OF FINANCIAL POSITIONAs at December 31, 2016

(In Philippine Peso)

Note 2016 2t)13

ASSETSCurrent Assets

Cash and Cash Equivalenits 4 344,630,714.39 259,962,536.45

Recivables5 383,069,005.51 245,683,915.40

nifvclor-ies 6 71,135,709.27 38,437,134.72

Other Current Assets 9 39,524,075.28 52,001,439.71

Total Current Assets 838,359,504.45 596,085,026.28

Non-Current Assets

Property Plart and Equipment 7 1,260,027,366.25 731 ,236,468.28

Intangible Assets 8 104,952.50 158,956.43

Other Non-Current Assets 9 10,291,226.17 16,362,817.72

Total Non-Current Assets 1,27_,423,544.92 747,758,242.43

Total Assets 2,108,783,049.37 1,343,843,268.71

LIA BIL ITI ES

Current Liabilities

Financial Liabilities 10 634,765,664.75 609,577,978.69

[nter-Agency Payables I 1 383,799,436.26 24,194,71723

Intra-Agency Payables 12 45,027,703.90 -

Trust Liabilities 13 344,308,389.14 270,563,000.47

Other Payables 14 1,975,657.45 1,267,478.48

Total Current Liabilities 1,409,876,851.50 905,603,174.87

Total Liabilities 1,409,876,851.50 905,603,174.87

Total Assets less Total Liabilities 698,906,197.87 438,240,09384

NET ASSETS[EQU1TY

EquityAccuinulated Surplus/(Deficit) 698,906,197-87 438,240,093.84

Trotal Net Assets(Ecluity 698,906,197.87 438,240,093.84

err

Tis statement should be rend in conjuncii<9n with the accoiPanvying notc-.

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PHILIPPINE STATISTICS AUTHORITY

STATEMENT OF FINANCIAL PERFORMANCE

For the Year Ended December 31, 2016

(in Philippine Peso)

Note 2016 2015

RevenueService and Business Income 15 925,870,489.65 863132,081.63

Shares, Grants and Donations I0 1,756,810.00 -

Total Revenue 927,627,299.65 863,132,081.63

Less: Current Operating Expenses

Personal Services I7 1,688,846,247.50 1,331,816,211.67

Maintenance and Other Operating Expenses 18 2,207,308,956.63 3,263740 17'239

Financial Expenses 19 374,031.71 519,738.85

Non-Cash Expenses 20 84,620,400.04 95,972,061 80

Tolal Current Operating Expenses 3,981,149,635.88 4,690 048,124 71

Su rplus (Deficit) from Current Operations (3,053,522,336.23) (3,828,916,103.08)

Net Financial Assistance/Subsidy 21 4,647,318,971.81 4,935,124,256 15

Gains 2.1 142,136.02 652.996.34

Losses 2' 6,076,521,69

Surplus (Deficit) for the period 1,587,862,249.91 1,106,861,149.41

this statemer) should be read in conjunction with the accompewnving notes.

PHILIPPINE STATISTICS AUTHORITY

STATEMENT OF CHANGES IN NET ASSETS/EQUITYFor the Year Ended December 31, 2016

(In Philippine Peso)

2016 2015

Balance at January l 438,240,093.84 427,142,861,77

Add/(Deduit):

.Changes in Accointing Policies (7,253,921.66) (10,454,098.60)

Pror period adjustments 42,945,065.04 (485,81 [.35)

Other Adjustments 2,142,981.06

Restated balance 476,074,218.28 416,202,951.82

Add/(Dedapt):Changes in Net Assets/Equity for the Calendar Year

Surplus for the period 1,587,862,249.91 1,106,861,149.41

Adjustnment of net revenue recognized direetly in net assets/equit (1,385,022,368.17) (1,037,884,768-64)

Others 19,992,097.85 (46,939,238.75)

Balance at December 31 698,906,197.87 438,240,093-84

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PHILIPPINE STATISTICS AUTHORITY

STATEMENT OF CASH FLOWSFor the Year Ended December 31, 2016

(In Philippine Peso)

2016 2015

Cash FIow from Operating Activities

Lsb InflowsReceipt ofrNotice of Cash Allocation 7,792,021,013.16 5,430,754,717.00

Constructive Receipt of TRA 162,124,761.85 212,723,477.92

Collections of Income/Revenues 926,279,407.98 863,653,184.66

Collee tion of Receivables 246,320.09 120,175.15

Receiþt of Inter-Agency Fund Transfers 64,492,904.60 82,939,850.00

Receipt of Intra-Agency Fund Transfers 179,062,206.63 83,497,198.63

[rust Receipts 2,966,628,152.61 2,751,058,076.88

Other Receipts 17,385,965.74 31,075,023.03

Adjustments 14,715,042.43 5,356,100.85

TotalCash Inflows 12,122,955,775.09 9,461,177,804.12

Cash OuflowsRemittance to National Treasury 925,180,412.06 72,930.02

Payment of Operating Expenses 3,535,668,107.55 1,326,195,300.87

Purchase of Invenrtories 48,122,843.54 26,1 59.50

Grant of Cash Advances 1,123,088.62 120,630,095.8 I

Prepayments 17,314,242.09 153,777,467-53

Paynlt of Deposits 1,797,927.78 50,000.00

Pavrnent of Prior Year's Accounts Payable 56,747,794.59 69,755,448.86

Remittance of Personnel Benefit Contributions

and Mandatory Deduetions 742,698,016.90 651,260,563-26

Grant of Financial Assistance/Subsidy - 2,821,948,377.00

Release of Inter-Agency Fund Transfers 3,000,000.00

Release of Intra-Agency Fund Transfers 2,697,841,648.50 71,968,081.63

Payment from Trust Liabilities/Fund Transfers 2,607,655,200.80 2,326,500,270.38

Other Disbursements 10,171,103.86 4,351, 89-16

Adjustments 1,362,470,346.53 1,724,073,61 3.56

Total Cash Outflows 12,009,790,732.82 9,270,609,497 58

Net Cash Provided by (Used in) Operating Activities 113,165,042.27 190,568,306.54

Cash Flows from Investing Activities

Cash InflowsProceeds from Sale/Disposal of Property, Plant

and Equipnent 34,634.00

Total Cash Inflows 34,634.00

2016

CashOuttlows 2 2-322 874,88urchase/ColstructiQon of Property, Plant and EBqui pme31,498.33

Total Cash Outflows 28,531,498.33 25 22 874.8X

Net Cash Provided by (Used in) Investing Activities 2496,864.33) (25,32,874.88)

Increase/(1)erease) in Casht and Cash Equivalents 84,668,177.94 165,245431 J6

2-59,962,536.45 94,717,14-79Cash and Cash lquivalents, Januarv 1 ----- 1-

Cash and Cash Equivalents, December 31

PHILIPPINE STATISTICS A UTHORITY

STATEMENT OF COMPARISON OF BUDGET AND ACTUAL AMOUNT

For the Year Ended December 31, 2016(In Philippine Peso)

¯Budgeled Amiounkt Aclal Amiouts:, onDiTrec

Patcuas(Current Year Appropriation) 1inkal Butet and(lL

Origna inaComprabe Bsis Acl.ual

Seri s ank lusincss InCOMC 740,469,000.00 740,469,000.00 920,839,517.16 (180,370317

740,469,000.00 740,469,000.0 920,839,517 16 (180,370.517 I )

payiw.wls.ýPeasnnel ctviccs 1,066.43

6 ,055. 4 4 1,527,448,549.44 1, 174,369,309.44 353,079,240 00

Majiice and Other Operating Expetnses 1,877,356,887"67 1877,356,887.67 1,442,335,765.81 435,021. 186

(AiI)l Olfflay 500,539,166.00 -500,539,166,00 27,6)39,306.33 472,899.859.67

ipnil layp e 284,344.42 284,344.42 326,184.42 (41,84000)

3,444,616,453.53 3,905,628,947.53 2,644,670,566.00 1,260,958.38 1.53

NI TRIi[111S/PAYMENTS (2,704,147,453.53 (3,165,159,947.53 1,723,83 1,048.8 41,328

LO