Republic of the Philippines

COMMISSION ON AUDIT
OFFICE OF THE AUDITOR
Construction Industry Authority of the Philippines
5/F 369 Executive Bldg., Sen. Gil J. Puyat Avenue, Makati City

Internal Control System Evaluation Report

on the Construction Industry Authority of the Philippines (CIAP )

Internal Control Component

1. INTEGRITY
AND
ETHICAL VALUES

Remarks/Observation
Status
The management set the tone Operating effectively.
at the top by demonstrating a
commitment to integrity and
ethics both in words and deeds.
Policies regarding business
practices, conflicts of interest
and code of conduct has been
established
and
properly
communicated
to
the
employees.
Employees are aware of all
forms of fraudulent acts
against the agency that will be
imposed of administrative and
criminal actions.

2. MANAGEMENT
PHILOSOPHY
AND
OPERATING STYLE

Top management is strongly Operating effectively.

committed to a system of
internal control.
Business risks are carefully
considered and adequately
monitored.
Important
management
decisions are dominated by
one individual.
Organizational structure of the
agency clearly defined the
lines
of
authority
and
responsibility.
The agency uses the Manual of
procedures. They maintain
copies of these files and an
employee is tasked to carry out
the procedures.
Written policies on the
delegation or assumption of
duties
and
rotation
of
employees are present.
Files of names in specimen

Internal Control Component

Remarks/Observation
signatures or initials of all
persons authorized to approve
transactions
is
being
maintained.

Status

3. MANNER
OF
ASSIGNING
AUTHORITY
AND
DELEGATING
RESPONSIBILITY

Levels of authority and Operating effectively.

responsibility are documented
through organizations chart.
Job
descriptions
clearly
document the authority level of
each employee.
Employees have been issued
with guidelines in relation to
their authority levels.

4. RISK ASSESSMENT

The agency has a risk Operating effectively.

assessment
framework in
place.
The agency easily identifies
risks in its operations.
The agency identifies the
likelihood
of
the
risks
happening and consequences
when they do happen.

5. CONTROL ACTIVITIES

CHECK
DISBURSEMENTS

All payments except for petty Operating effectively and

cash disbursements and payroll in proper.
are made by checks.
Checks are pre-numbered.

Checks are issued in

numerical sequence.
Checks
drawn
are
countersigned by another
responsible official.
Authorized
Government
Servicing Banks (AGSBs) are
furnished with the name and
specimen
signatures
of
officials authorized to sign
checks.
Signing of checks are limited
to officers or employees who
have no access to accounting
records or to cash.
Checks for signature and
countersign
are
always
accompanied by approved
vouchers
and
supporting
documents.
Disbursement
vouchers,
supporting documents and
account
distribution
are

Internal Control Component

Remarks/Observation
reviewed
by
authorized
accounting staff. The covering
voucher is signed by the
person who made the review.
DVs and other supporting
documents are reviewed by at
least one signatory preparatory
to the signing of the check.
Supporting documents are all
stamp paid or marked with
similar
indications
immediately after the check is
signed to prevent possible reuse.
Payees signature or receipt
secured before the check is
delivered.

Status

6. INFORMATION AND
COMMUNICATION

Reports adequately highlight Operating effectively.

variances and where variances
occur.
Variances
are
promptly
communicated to the top
management.
Audit
trail
within
the
organization
is
clearly
identifiable.

7. MONITORING

There is no internal audit Operating effectively.

within the agency.
The Planning and Monitoring
Division regularly evaluates
the effectiveness of the
controls.

Prepared by:

Noted by:

JOVEN M. MACASINAG
State Auditing Examiner II
Audit Team Member

YOLANDA P. JUAN
State Auditor III
Audit Team Leader