After nearly a decade of continuous efforts by the University to enhance its financial management practices, the Commission on Audit's second ‘Unmodified Opinion’  is a testament to BSU's pivoting toward exemplary financial documentation.

In an interview, University accountant Dr. Imelda B. Galinato asserted that the latest audit opinion attests to the reliability of the financial statements presented by the university to its diverse array of users and stakeholders. “This is one of the ways we tell the public that we mean business in the preparation of financial statements,” she said. 

Likewise, Chief Administrative Officer of the Finance Division, Atty. Andres Arnold W. Lampacan expressed his resolute confidence in the university's ability to ensure that the government's resources allocated to the institution are utilized with optimal efficiency and effectiveness in the performance of its four-fold functions.

Comprehending COA and the Art of Auditing: Processes and Operations

In the world of accounting and finance, an audit represents the meticulous scrutiny auditors undertake to examine the financial data provided by both public and private organizations to determine the accuracy and impartiality of their financial statements. 

In the Philippines, the practice and concept of auditing were introduced by the Spanish colonizers, culminating in the establishment of the General Auditing Office as mandated by the 1935 Constitution. Subsequently, it was renamed the Commission on Audit (COA) following the country’s imposition of Martial Law and remains to be the country’s supreme audit institution. 

Thus, according to Presidential Decree No. 898, s. 1976, the COA has all authority and jurisdiction on all government matters pertaining to “auditing and accounting procedures, systems, and controls, including inquiry into the utilization of resources and operating performance, [and] the keeping of general accounts.”

Further, as per this mandate, the COA issues an annual audit opinion on the submitted financial statements, encompassing the entirety of the fiscal year.
 

Following the process of an audit are the auditors’ conclusive assessments in the form of an audit opinion. These opinions are based on the financial reporting framework such as the Philippine Financial Reporting Standards (PFRS) patterned after the International Financial Reporting Standards (IFRS) utilized by countries around the world and the Generally Accepted Accounting Principles (GAAP). 

Briefly defined, an audit opinion represents the final viewpoint of auditors subsequent to the evaluation of the information supporting the financial statement. It can fall into one of the four categories: Unmodified (Unqualified) Opinion, Modified (Unqualified) Opinion, Adverse, or Disclaimer. 

Also called a clean opinion, an unmodified (unqualified) opinion is rendered if the financial statements being audited are presented fairly in all material respects and in accordance with the financial reporting framework. In other words, the audit report substantiates the findings without any notable misstatements.

It is important to note, however, that obtaining an Unmodified (Unqualified) Opinion does not necessarily imply a flawless slate. Rather, it suggests that any misstatements have been rectified by the audited entity or are not considered material—meaning they do not have a substantial quantitative or qualitative impact on financial decisions.
    
BSU’s Unmodified Opinion: Implication and Ways Forward

“Of course that means improvement in the process and management. At the same time, it also reflects the university’s unwavering dedication and commitment. We try our best, almost to the point of perfection, to meet the expectation of the oversight bodies,” Dr. Galinato replied when asked about the recent COA audit opinion for the university.

Budget Supervising Administrative Officer Dr. Estrellita M. Daclan concurred that it is a reflection of the university’s utilization of funds, the efficiency of its financial management, and timely compliance.

“I believe that every agency has its own problems and challenges but we in the university remain to be within the (legal) boundary. That means we are trying our best to address all concerns by being flexible, prompt, and obedient in compliance with the mandates. With this, I also hope that we would continue to improve proper planning and coordination and not forget to support one another in this,” she added.

On another note, it is also substantial to underscore the simple and subtle role of leadership and its transformative impact in any organization. For Vice-President for Administration and Finance Atty. Allan C. Sacpa, this means an equilibrium between visionary and bureaucratic leadership.
 
According to him, being visionary entails surpassing limitations and exploring all avenues to achieve objectives and goals, while remaining steadfast and uncompromising in upholding governing laws and regulations.

Atty. Sacpa further acknowledged that although laws and policies can sometimes appear as obstacles to realizing our visions, they are designed with two underlying purposes: to facilitate the implementation of orders and to safeguard against the misuse of advantages. He then emphasized the importance of considering not only the desired destination but also the means by which they are attained. “We have to be positive in understanding that there are always rationales behind those promulgated laws,” he added. 

Following this, Atty. Lampacan shed light on the role of COA, asserting that it is essential to perceive the agency as a technical entity executing its functions and that while there may be occasional misunderstandings regarding the perceived restrictions imposed by COA on government agencies, he encouraged a positive interpretation.

“I think  we  should  see it in a positive light and adopt a positive perspective. As a subject of an audit, suppose  we find in our perspective that they are implementing a policy that is not really beneficial to the government service, then we target and give feedback to improve the policy and not take it against the people of COA as they are merely adhering to their function. Instead, we should look at them as a guide for us to comply with the regulations or guidelines imposed upon us,” he pointed out. //CANapiloy