EXECUTIVE SUMMARY

A. Introduction

The University of (UA) started as a trade technical institution, the Antique School of Arts and Trades (ASAT), on January 19, 1954. On November 14, 1982, Batas Pambansa 281 authorized the conversion of the school into a state college, the Polytechnic State College of Antique (PSCA). With the passage of RA 8292, otherwise known as the “Higher Education Modernization Act of 1997,” and through CHED Memorandum Order No. 27, CHED-supervised institutions namely Antique College of Agriculture in Hamtic, Antique and Tario- Lim Memorial School of Fisheries in , Antique, were integrated with PSCA.

The PSCA Board of Trustees, in its Resolution No. 105, series of 2000, approved the opening of extension classes on Bachelor of Science in Industrial Technology (BSIT) Program in Semirara, , Antique effective school year 2000-2001 but the MOA was not renewed. Then the Board approved Resolution No. 201 series of 2002 to open the extension classes at the island Municipality of Caluya, Antique effective school year 2002-2003.

Also, with Resolution No. 25, series of 2005, the Board approved the opening of extension classes in the Municipality of Libertad, Antique effective school year 2005-2006. Extension classes at Caluya and Libertad are still operational as of this date.

On November 10, 2009, President Gloria Macapagal-Arroyo signed RA 9746, an Act converting PSCA in the municipality of into a state university to be known as the University of Antique (UA), including its external campuses in the municipalities of Hamtic and Tibiao.

Governance of UA is vested upon the Board of Regents, which exercises policy-making functions to carry out the mission and programs of the University by virtue of RA No. 8292.

UA is administered by President Victor E. Navarra, Ed.D. assisted by three (3) central administrative officers: the Vice President for Academic Affairs; the Vice President for Research, Extension and Training Services; and the Vice President for Administration and Finance.

The External Campuses are under the leadership of the following Campus Directors: Hamtic Campus - Mr. Noel M. Montaño and Tario-Lim Memorial Campus - Dr. May T. Delgado.

The total personnel complement of UA comprises the following:

No. of Employees Office Permanent Part Time Casual Contractual Total UA – Main 143 225 2 123 493 UA – Hamtic 42 3 0 4 49 UA – TLMC 63 33 2 35 133 GRAND TOTAL 248 261 4 162 675

The mission of the University is to provide quality, relevant, and responsive scientific technological and professional education and advanced training in different areas of specialization, and shall undertake research and extension services in support to socio-economic development of Antique, the Filipino nation, and the global community.

B. Operational Highlights

During the year, UA reported the following accomplishments:

Programs/Projects/ Actual % of Targets Activities Accomplishments Accomplishments MFO 1 Higher Education Services 1. Total No. of graduates 1490 1372 92.08% MFO 2 – Advanced Education Services 1. Total No. of graduates 30 42 140.00% MFO 3 – Research Services 1. No. of research studies completed 10 26 260.00% MFO 4 – Technical Advisory Extension Services 1. No. of persons trained weighted by the length of training 1100 2082 189.27% 2. No. of persons provided with technical advise 200 453 226.50%

C. Financial Highlights

During the year, the total allotment received, obligation and unexpended balance of allotment are as follows:

Allotment/Funds Obligation/Amount Appropriation Balances Received Expended Agency Specific Budget 1. New Gen Approp. 128,943295.00 128,943295.00 122,447,488.12 6,495,806.88 2. Continuing Approp. 0.00 0.00 0.00 0.00 3. Supplemental Approp. 27,158,340.00 27,158,340.00 6,464,778.33 20,693,561.67 Allotment/Funds Obligation/Amount Appropriation Balances Received Expended Off Budgetary Funds 4. Retained Income Fund 182,226,105.18 182,226,105.18 124,546,229.12 57,679,876.06 5. Revolving funds 0.00 0.00 0.00 0.00 Unprogrammed funds Custodial Funds* Trust receipts, grants and donations from other gov’t agencies (ex. Scholarship funds, research grants, endowment fund, CHED funded projects) 9,626,280.72 1,987,301.35 7,638,979.37 PDAF 8,800,000.00 7,374,690.40 1,425,309.60 DAP 7,000,000.00 3,673,636.30 3,326,363.70 *Please see Annex 1 for details and composition of this fund.

In addition to the allotment received, UA collected a total income of P124,053,190.02 from tuition fees and other charges as well as from its income generating projects that was constituted as Special Trust Fund by virtue of RA 8292.

Its assets, liabilities, government equity, and sources and application of funds for CY 2014 with comparative figures in CY 2013 are presented as follows:

Particulars 2014 2013 Inc. (Dec) % A. Financial Condition Assets 314,802,470.34 304,572,309.80 10,230,160.54 3.36% Liabilities 66,376,086.58 74,877,216.87 (8,501,130.29) -11.35% Accumulated Surplus 248,426,383.76 229,695,092.93 18,731,290.83 8.15% B. Financial Performance B.1 Sources of Funds Subsidy from National Government 138,738,256.26 136,926,344.87 1,811,911.39 1.32% Service & Business Income 124,051,224.54 110,399,040.81 13,652,183.73 12.37% Gains 1,965.48 0.00 1,965.48 Total Income 262,791,446.28 247,325,385.68 15,466,060.60 6.25% B.2 Application of Funds Personal Services 105,349,614.51 112,149,817.97 (6,800,203.46) -6.06% MOOE 122,230,913.48 99,672,607.83 22,558,305.65 22.63% Financial Expenses 1,119,608.47 1,254,348.61 (134,740.14) -10.74% Non-cash Expenses 11,111,492.43 10,581,946.63 529,545.80 5.00% Total Expenses 239,811,628.89 223,658,721.04 16,152,907.85 7.22% Excess of Income over Expenses 22,979,817.39 23,666,664.64 (686,847.25) -2.90%

D. Scope of Audit

The audit covered the accounts and operations of UA-Main (including the 2 extension campuses) and its two external campuses for the year ended December 31, 2014. The audit was conducted to: (a) verify the level of assurance that may be placed on management’s assertions on the financial statements; (b) recommend agency improvement opportunities; and (c) determine the extent of implementation of prior years’ audit recommendations.

E. Independent Auditor’s Report on the Financial Statements

The Auditor rendered a qualified opinion on the fairness of presentation of the financial statements of UA for the year ended December 31, 2014 due to exceptions as stated in the Independent Auditor’s report and as discussed in Part II of this Annual Audit Report.

F. Summary of Significant Audit Observations and Recommendations

The following are the significant observations with the corresponding recommendations:

1. Failure to conduct an actual physical inventory of the Agency’s Property Plant and Equipment, totaling P308,555,397.74 per General Ledger as well as failure to conduct the requisite reconciliation of the Accountants’ vis-a-vis Supply Officers’ records, was contrary to Section 490 of the Government Accounting and Auditing Manual (GAAM), Volume I, and Appendix 8, paragraph C of the Manual on the NGAS, Volume II, resulting in doubtful existence and valuation of the assets.

We recommend that Inventory Committee strictly follow the scheduled inventory- taking of the agency’s Property, Plant and Equipment and that the Chief Administrative Officer coordinate the reconciling activities between the Accounting and Property Records, to ensure the existence and accurate valuation of the assets.

2. Balances of Receivables and Liabilities amounting to P11,661,512.82 and P66,376,086.58, respectively, are not supported by schedules and subsidiary ledgers contrary to Section 71 Volume I of NGAS Manual, thus collectability of receivables, settlement of payables, and correctness of these accounts cannot be ascertained.

We recommend that management strictly adhere with the accounting policies and procedures prescribed under Vol. I of NGAS Manual for National Government Agencies regarding the preparation and maintenance of Subsidiary Ledgers per account and submission of Supporting Schedules to ensure the accuracy of the account balances in the financial statement and reconcile total of Schedule of Advances to Officers/Employees (148) with the account balance in Trial Balances.

3. Valuation of Supplies and Materials Inventory amounting to P555,299.35 as of December 31, 2014 is doubtful due to failure to conduct physical count of inventories and to record supplies and materials purchased as inventory, contrary to Sections 4(j) and 43 Volume I and Appendix 62 Volume II of Manual on the NGAS for National Government Agencies.

We recommend that the management of all campuses strictly adhere with the procedures on the accounting of the purchases and issuances of inventory items as prescribed in Volume I of Manual on the NGAS for National Government Agencies, including the preparation and maintenance of Stock Cards and Supplies Ledger Cards and reconcile the Report on the Physical Count of Inventories to the book balances..

The above findings together with the other observations and recommendations were discussed with management in an exit conference. Management comments are incorporated in the report where appropriate.

G. Status of Settlement of Accounts

The Status of unsettled Suspensions, Disallowances and Charges issued as of December 31, 2014 are as follows:

Notice of Notice of Notice of Campus Total Suspension Disallowance Charge UA – Main 1,142,156.56 14,947,690.76 0 16,089,847.32 UA – Hamtic 0 5,269,699.00 0 5,269,699.00 UA – TLMC 0 2,460,000.00 0 2,460,000.00 TOTAL 1,142,156.56 22,677,389.76 0 23,819,546.32

Of the total disallowances of P22,677,389.76, the amount of P10,556,389.76 is covered by Notices of Finality of Decision and booked as receivables in the Financial Statements while the remaining balance of P12,121,000.00 is under appeal with the Commission on Audit.

H. Status of Implementation of Prior Years’ Recommendations

The status of implementation of prior years’ audit observation is shown below:

Status of No. Percentage Implementation Fully Implemented 4 44.44% Partially Implemented 4 44.44% Not Implemented 1 11.11% Total 9 100.00%

The details of the status of implementation of prior years’ audit observations are presented in Part III of this report.