Solution 3.1b Uta Summary

(Please take note that in the actual conduct of understanding an agency’s profile, information to
be gathered shall be more exhaustive than this sample. Detail of the data presented is limited only
to accommodate the information needed in the Case Study.)
UNDERSTANDING THE AGENCY TEMPLATE

Agency : Housing Development Authority Prepared by : Date :
:
Audit Period CY 2011 Reviewed by Date
: :
:
Office Approved by Date
: :
UTA Summary
Identified Agency Risk Impact on the

UTA Ref.
Risk Title Risk Statement Agency
1. The 70% investible
B.  The Authority
funds to housing may not
lacks focus on
Function: be attained due to
the customer/
Investing investments in bonds and
public which
Public Service and other marketable
threatens the
Operations: securities.
agency’s capacity
to meet or
Customer/public
exceed the
Satisfaction
customer’s/
public’s
Strategic:
expectations.
Resource Allocation 2. Inappropriateness of
resource allocation
process prohibits the
agency’s ability to provide
value for public.
B. Strategic  Increase in past
due restructured
Function: Major initiatives 3. The policy on
accounts.
restructuring may not
-Planning and
consider the capacity to
Restructurin Execution pay of the defaulting
g borrower/s.
Environment
Dynamics:
Economic changes
4. Economic changes, such
as lower economic
growth, and opportunities
may not provide a wide
range of services or limit
“The information provided for this practice set is intentionally created for the IRRBA workshop
purposes. All transactions are fictitious and do not represent any real life scenario.”
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UTA Ref.
the availability or quality
of existing services.
5. Housing units financed by

B. Strategic  Increase of non-
the HDA- may not be
Processes: performing loans
Major Initiatives – properly awarded to
and acquired
Housing Planning and intended beneficiaries
assets.
Program Execution due to absence or lack of
proper and appropriate  Inefficient and/or
guidelines in the ineffective
production and award of implementation of
housing units to intended the housing
beneficiaries. program
 Delay of
investment
recovery that may
affect the cash
position of the
Authority
6. Failure to conform to
B. Operations  Increase in past-
established internal
Processes: due accounts of
Public Service procedures or regulations
defaulting
Housing Operations - on “buy-back” guarantee
borrowers that
Programs- Efficiency for loans that defaulted
may affect the
Developer within the seasoning
liquidity of the
Assisted with period of two years by the
Authority.
buy back developer may result to
guarantee non-issuance of notice of  Increase in
“buy-back” within the acquired assets
prescribed period of 15 that cannot be
calendar days from date easily disposed.
of default.  Delay of
investment
recovery that may
affect the liquidity
of the Authority.
B. Strategic
Processes:
Planning and 7. Outsourcing activities to  Inability to obtain
Housing Resource allocation third parties may result in the optimal level
Program- - Outsourcing the third parties not acting of payment
Collection within the intended limits of received from
Financial their authority or not
housing loan
performing in a manner
Liquidity and Credit beneficiaries
consistent with the agency’s
– Credit and strategies and objectives. (borrowers).
Collections
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UTA Ref.
8. The unreasonable delay

in the receipt of
collections from
borrowers, Developers,
Banks and other
institutions authorized as
collecting agents on
housing loans.
D. Operations  Delays in the
Management: processing of
People – 9. The absence of an
housing loans
Manpower Recruitment and appropriate policy on
especially those
Complement Retention recruitment may result to
that are based on
insufficient number of
percentage of
skilled and qualified
completion.
employees to man critical
positions such as those  Delivery of sub-
performing standard housing
appraisal/inspection of units by
developer’s projects, developers and
acquired assets, approval of
collateral for foreclosure, housing loans
and progress construction resulting in high
of housing units. incidence of
defaulting
accounts.
D. Strategic  Inefficient delivery

Management: of services or risk
Planning and 10. Outsourcing activities to
of asset
Manpower Resource allocation third parties may result in
misappropriation
Complement - Outsourcing the third parties not acting
when contractual
within the intended limits
employees fail to
of their authority or not
do things they
performing in a manner
should do.
consistent with the
objectives and strategies
of the HDA.
E. Operations  The private sector

11. The HDA may fail to
partners may fail
Objectives Public Service & choose the right private
to perform their
and Operations- sector partner.
obligations
Strategies
Partnering resulting in non-
attainment of
objectives of the
housing program.
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UTA Ref.
E.  Low membership
collection will
Objectives Financial reduce the funds
and 12. The HAD may fail to raise
Liquidity and Credit- available for
Strategies appropriate funds to finance
Funding lending purposes.
housing programs.
E. Code of conduct:  Loss of

Stakeholders government
Third Party Fraud
-Developers funds.
13. The risk that the
K Recent fraudulent activities
Development perpetrated by
/ News employees, agents or
third-party administrators
against the agency for
personal gain (e.g.
misappropriation of
physical, financial or
information assets)
expose the agency to
Compliance
financial loss.
Mandate:
Reputation
14. Damage to the Agency’s

Reputation exposes it to loss
of customer/public trust,
profits and the ability to grow.
15. The Board may adopt The Board of

G. Key Compliance:
policy guidelines not Trustees provides
Environmental
Governance- aligned with the HDA the policy directions
Factors
Board mandate due to political absence of which
Political patronage. impacts the
performance/Agenc
y management attainment of the
committee agency’s objectives.
i. .
G.Key Compliance: 16. Changing laws may threaten  Policies and

Environment HDA’s capacity to operations
Legal-Legal
al Factors consummate important adversely
transactions, enforce affected by
Legal and
contractual agreements or changing laws
Regulatory implement specific and regulations.
strategies and activities.
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UTA Ref.
17. The current IT
ii. Operations:  Unreliable
infrastructure may not
financial and non-
G.Key Information & adequately ensure
financial reports
Environment Technology- integrity and
affect the
al Factors confidentiality of data and
Security/Access decisions of
information as Access
management.
Risk and Fraud Risk
Technologica remain high especially in
Integrity
l the Branches/Regional
Offices where the
Systems Administrator as
a super-user has access
to all databases and
passwords.
18. Illegal acts committed by
H. Key Compliance:  Loss of
senior management,
Performance government
Code of conduct- division heads or
Indicators funds.
Illegal Acts employees may expose
the agency to fines,
sanctions and loss of
public trust, profits and
reputation and the like.
19. Incomplete, inaccurate

I. Existing Financial:  Unreliable
and/or untimely reporting
Accountin financial and non-
Accounting, of required financial and
g Policy financial reports
reporting, and operating information to
affecting the
disclosure other regulatory agencies
decisions of
may expose the agency
management.
to fines, penalties and
sanctions.
20. Over-emphasis on
financial accounting and
other information to
manage the operations
may result in the
manipulation of outcomes
to achieve targets at the
expense of not meeting
public expectation, quality
and efficiency objectives.
21. Terms and conditions of
J. Previous Compliance:
the Memorandum of
Audit
Legal Agreement entered by  Loss of
Findings
HDA with the developers government
may be unfavorable to funds.
HDA and they may fail to
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UTA Ref.
comply with and monitor
contract terms to protect
the HDA from financial
losses.
22. This risk refers to the

K. Analytical Financial-  Reduces
inability to obtain the
Review: investible funds of
Market: optimal level of payment
HDA.
Financial received as a result of a
Credit and
Collections prior agency transaction.
23. Failure to evaluate project

Strategic  Non attainment of
proposals may result in
project’s
Major Initiatives: problems when the
objectives.
Project Evaluation project has been
approved.
M.
PAPs
24. The HDA may fail to
Operations  The private sector
choose the right private
partners may fail
Public Service & sector partner.
to perform their
Operations-
obligations
Partnering resulting in non-
attainment of
objectives of the
housing program.
6|Page

Solution 3.1b Uta Summary

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(Please take note that in the actual conduct of understanding an agency’s profile, information to

UNDERSTANDING THE AGENCY TEMPLATE

Identified Agency Risk Impact on the

5. Housing units financed by

8. The unreasonable delay

D. Strategic  Inefficient delivery

E. Operations  The private sector

E. Code of conduct:  Loss of

14. Damage to the Agency’s

15. The Board may adopt The Board of

G.Key Compliance: 16. Changing laws may threaten  Policies and

19. Incomplete, inaccurate

22. This risk refers to the

23. Failure to evaluate project

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