The Commission on Audit has flagged the Government Service Insurance System and the Social Security System for “undistributed collections” worth P11.51 billion and P1.135 billion, respectively.
In its annual financial report on government-owned and controlled corporations, the commission noted the delayed posting of contributions and loan payments of GSIS and SSS members.
“Undistributed collections” refer to the contributions and loans paid by members, pensioners or borrowers but were not credited or posted to their individual accounts.
The COA noted that delayed posting of collections by the GSIS worth P11,510,387, recorded under “accounts for clearing”, may result to lower benefits for members or pensioners.
“The member’s period with paid premiums (PPP) is the basis in computing the retirement benefits. In case of underpayment of premium, only such portion of the service that is proportionately equivalent to the amount actually received by the system shall be recognized as PPP,” the COA said.
The COA also flagged SSS for its P1,135,460 billion undistributed collections recorded under “Other Current Liability-Members Loans.”
The commission said undistributed collections could have been avoided if the SSS exerted efforts to coordinate with employers with problematic contributions and loan payments records.
“Inasmuch as the SSS have identified the (employers) and their SBR (special bank receipt) numbers and dates, these employers should have been immediately informed. These employers and member-borrowers may not have known that their payments were not recorded or deducted from their loans,” the COA said.
The COA added that undistributed collections may “result in inaccurate loan balances, if not corrected, may result in erroneous amount of benefit claim or delay in receipt of benefit claim.”
Other GOCCs which got red flags from COA for undistributed collections in 2016 were Home Development Mutual Fund (Pag-IBIG Fund) with P604.154 million, Armed Forces of the Philippines-Retirement and Separation Benefits System (AFP-RSBS) with P5.665 million, Social Housing Finance Corp. (SHFC) with P440.339 million and National Home Mortgage and Finance Corp. (NHMFC) with P118.471 million.
In its report, COA recommended to the GOCCs that they should “post the UC (undistributed collection) to the specific SL (subsidiary ledger) account of the member/pensioner/borrower” and “conduct continuous clean-up of the UC accounts to minimize its accumulation and adjust affected accounts accordingly.”