Republic of the Philippines

COMMISSION ON AUDIT
Commonwealth Avenue, Quezon City, Philippines
Corporate Government Sector
Cluster III Public Utilities
STATE AUDITORS REPORT
The Board of Directors
Philippine Postal Corporation
Liwasang Bonifacio, Manila
e have au!ite! the accompanying consoli!ate! financial statements of the Philippine
Postal Corporation, which comprise the balance sheet as of "ecember #$, %&&', the
income statement, statement of changes in e(uity an! cash flow statement for the year
then en!e!, an! a summary of significant accounting policies an! e)planatory notes*
Managements Responsibility for the Financial Statements
Management is responsible for the preparation an! fair presentation of these financial
statements in accor!ance with Philippine +inancial Reporting ,tan!ar!s* -his
responsibility inclu!es. !esigning, implementing, an! maintaining internal control
relevant to the preparation an! fair presentation of financial statements that are free from
material misstatement, whether !ue to frau! or error/ selecting an! applying appropriate
accounting policies/ an! ma0ing accounting estimates that are reasonable in the
circumstances*
Auditors Responsibility
1ur responsibility is to e)press an opinion on these financial statements base! on our
au!it* e con!ucte! our au!it in accor!ance with Philippine ,tan!ar!s on Au!iting*
-hose stan!ar!s re(uire that we comply with ethical re(uirements an! plan an! perform
the au!it to obtain reasonable assurance whether the financial statements are free from
material misstatement*
An au!it involves performing proce!ures to obtain au!it evi!ence about the amounts an!
!isclosures in the financial statements* -he proce!ures selecte! !epen! on the
au!itor2s 3u!gment, inclu!ing the assessment of the ris0s of material misstatement of the
financial statements, whether !ue to frau! or error* 4n ma0ing these ris0 assessments,
the au!itor consi!ers internal control relevant to the entity2s preparation an! fair
presentation of the financial statements in or!er to !esign au!it proce!ures that are
appropriate in the circumstances, but not for the purpose of e)pressing an opinion on the
effectiveness of the entity2s internal control* An au!it also inclu!es evaluating the
appropriateness of accounting policies use! an! the reasonableness of accounting
estimates ma!e by management, as well as evaluating the overall presentation of the
financial statements*
e believe that the au!it evi!ence we have obtaine! is sufficient an! appropriate to
provi!e a basis for our opinion*
Opinion
As state! in 5otes 6 7 $8 an! 5ote %9 :!; to the financial statements, the balance sheet
inclu!es various assets an! liabilities in the total amounts of P#*< billion an! P%*'
billion, respectively, representing balances which accumulate! prior to the incorporation
of the Bureau of Post in $==% an! !uring the conversion of its accounts into the
Corporation2s boo0s, which coul! not be substantiate! with proper supporting
!ocuments*
Accounts Payable an! Accounts Receivable>4nternational Accounts inclu!e !oubtful
balances in the amounts of P%*$=% billion an! P$*<== billion, respectively, which
remaine! una!3uste!?unreconcile! as of the balance sheet !ate*
-he recor!e! balance of the Cash in Ban0 account in the amount of P$*9 billion is more
than the confirme! ban0 balance of P8$9*6 million* Li0ewise, the balance of the Cash
with Collecting 1fficers account of P<<*6 million is more than the reporte! balance in the
postmasters2 financial reports of P#$*% million* 5o reconciliation was ma!e of the
variances of P=$8*9 million an! P8'*9 million, respectively*
4n our opinion, because of the effects of the matters !iscusse! in the prece!ing
paragraphs, the financial statements referre! to above !o not present fairly in conformity
with the Philippine +inancial Reporting ,tan!ar!s, the financial position of the Philippine
Postal Corporation as of "ecember #$, %&&', an! its financial performance an! its
cash flows for the year then en!e!*
COMMISSION ON AUDIT
SABINIANO ! CABATUAN
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