Government funds may have been “wasted” with the purchase of 6,000 units of fire extinguishers worth P10.1 million because the contract was awarded to an “ineligible” supplier while 519 of the units purchased in 2010 could not be accounted for.
The Commission on Audit (COA) is asking the Cebu City Hall department tasked to distribute the fire extinguishers to conduct a physical inventory of the supplies in order to trace the location of the “unaccounted” units.
“Failure to do so may make them liable for the value of the lost assets,” stated the 2011 audit report.
The Cebu City government bought 6,000 units of fire extinguishers worth P1,690 each. The purchase was delivered to the city on Dec. 2010 and was stored at the Department of Education (DepEd) warehouse in barangay Labangon.
Councilor Jose Daluz III, whom Mayor Michael Rama tasked to oversee the distribution of the fire extinguishers said the COA was incorrect in reporting that 519 units of the fire extinguishers cannot be accounted for.
He said the items are still in the DepEd warehouse in Labangon. Their latest inventory dated Aug. 10 showed that 5,649 fire extinguishers were already distributed leaving behind 351 units in the warehouse.
The fire extinguishers were distributed to the public schools, government offices, barangay council offices and the Cebu City Medical Center (CCMC) from January to July 2011.
Daluz said the confusion could have been avoided if auditors requested for his presence during their July 30 exit conference with Mayor Rama.
Daluz said it was also incorrect for COA to say that the purchase was not properly planned. He said that when they made the purchase, they included a buffer stock of 5 to 10 percent to meet future demands from the barangays.
A report by state auditor Francisca Jumao-as said the number of fire extinguishes bought and the substantial number of units left undistributed may indicate “lack of planning” in City Hall purchases.
However, upon their verification on March 3, 2012, they only accounted 726 units of fire extinguishers and could not locate the whereabouts of the 519 others worth P877,110.
“This may indicate poor planning which may result in eventual wastage of government resources if these extinguishers remain undistributed in the warehouse until expiration,” the COA report. said.
Auditors also noted a lapse in the purchase of the fire extinguishers after the Bids and Awards Committee (BAC) awarded the purchase to a supplier which failed to submit its track record, a requirement in the Implementing Rules and Regulations of the Government Procurement Reform Act.
Even the distribution of the fire extinguishers to its intended users were not properly documented, making it difficult for government auditors to determine actual custody of the government property.
Fire extinguishers which were given to the custody of sitio leaders in the barangays were only made to sign logbooks as proof of receipt.