Management Services

Report No. 2002-05E

Government-wide Performance Audit

Performance Reporting
System

BUREAU OF PRODUCT STANDARDS

DEPARTMENT OF TRADE
AND INDUSTRY
 Republic of the Philippines
Commission on Audit
MANAGEMENT SERVICES
Commonwealth Avenue, Quezon City, Philippines
Telephone Nos.: 931-9235 , 931-74-55

March 25, 2004

THE HONORABLE SECRETARY

Department of Trade and Industry
Gil Puyat Ave., Makati City

Sir:

We are pleased to transmit the report on the government-wide audit of

the Performance Reporting System of the Products Standards Development and
Promotion Program of the Bureau of Product Standards (BPS) which is under
that Department. The audit was conducted in compliance with COA Office
Orders Nos. 2002-518 and 2002-518A and pursuant to COA Memorandum dated
February 13, 2003. The audit highlights were forwarded to that Office, copy
furnished the Director, BPS, on October 16, 2003 for comments. Their comments
were incorporated in the report where appropriate.

The audit was conducted to assess the efficiency and effectiveness of the
performance reporting system giving consideration to the sufficiency of
performance indicators and the reliability, relevance and completeness of
performance information.

We look forward to the proper implementation of the audit

recommendations and we would appreciate being informed of the actions taken
thereon within one month from receipt hereof.

We acknowledge the cooperation and assistance extended to the team by

the officials and staff of the Department and the BPS.

Very truly yours,

By Authority of the Chairman:

ILUMINADA M.V. FABROA

Director IV
Contents Page
Part I Executive Summary 1

Background 2
Audit Objective 4
Audit Scope and Methodology 4
Audit Conclusion 5
Management’s Reactions to Audit Observations 6

Part II About the Program Evaluated 7

The Department of Trade and Industry

Mandate/Objectives/Organization 8
The Bureau of Product Standards
Mandate/Objectives/Activities 9
Reporting System 12
Program Accountability Model 13

Part III Audit Observations and Recommendations 14

Chapter 1 Complete and Informative

Reporting 15

Introduction 16
Observation 16
Management’s Response and
Team’s Rejoinder 22
Recommendations 23

Chapter 2 Accurate and Reliable Reporting 24

Introduction 25
Observation 25
Recommendation 27

Chapter 3 Timely Submission of Reports 28

Introduction 29
Observation 29
Recommendation 30
 Part I

Executive Summary

1
EXECUTIVE SUMMARY

BACKGROUND

Governments around the world consider effective performance management and

reporting system as a vehicle for enhancing public accountability and driving the
achievement of government outcome. In line with this principle, the Philippine
Government, through the Department of Budget and Management (DBM) and
the National Economic Development Authority (NEDA), embarked on projects
to further strengthen accountability mechanisms and improve public expenditure
management. One of the projects that was initiated by the DBM for this purpose
was the Public Expenditure Management Improvement Project (PEMIP). The
objectives of the PEMIP are as follows:

 To enhance aggregate fiscal discipline;

 To improve resource allocation; and
 To promote operating efficiency at the agency level.

The major components of the PEMIP are as follows:

 Medium-Term Expenditure Framework (MTEF);

 Agency Performance Measurement System;
 Agency Managerial Flexibility; and
 Performance Incentives.

The Philippine Government started to introduce the MTEF and the

Organizational Performance Indicator Framework (OPIF) through the FY 2000
National Budget Call. This was refined in the FYs 2001- 2002 budget calls, with
the introduction of periodic assessment of on-going Programs, Activities and
Projects (PAPs). These projects are subjected to the Sector Effectiveness and
Efficiency Review (SEER). The MTEF, OPIF, and SEER constitute the three
pillars of the Government’s public expenditure management reform program.

Under the MTEF, the budget will be restructured to cover a number of years to
better support the Government’s development strategy and improve technical
efficiency in the sectors by “providing a more predictable resource environment
for program planning and implementation.”

Hand in hand, the concept of performance indicators was introduced through

OPIF. The indicators were intended to be linked to the organization’s
performance in order to encourage government agencies to allocate and/or
reallocate resources towards high priority PAPs. Under OPIF, the appropriate
final output directly linked with the actual organization performance of the

2
 EXECUTIVE SUMMARY

agencies will be identified and developed. A final output is a good or service

produced or provided by an organization which is consumed or used by an
external client.

Another project of the government which is related to performance reporting is

the Formulation of Performance Indicators and Standards for Development
Administration (FPISDA) Project. This project was undertaken by NEDA in
relation to the paradigm shift in governance which is called “development
administration” covering six areas of concern including, among others, re-
engineering or streamlining the bureaucracy, privatization and decentralization.
Under the project, NEDA commissioned the Development Academy of the
Philippines (DAP) to formulate performance indicators and standards on the
areas of concern of development administration. These indicators are intended to
monitor and evaluate government’s performance under the new concept of
“development administration”. The ultimate objective of FPISDA is a shift to
performance-based planning, programming and budgeting system.

In line with the government’s efforts to improve public expenditure management

and strengthen accountability, a study on the existing performance reporting
system of selected government agencies was undertaken. Performance reporting
is considered as an integral part of the government’s accountability framework.

Reporting is the final phase of any activity and the resultant reports are
considered to be the windows of accomplishments. For this reason, performance
reports to be useful must be credible. Performance reports of government
agencies are used by different sectors. Internal users or the management use the
report to assess and monitor the progress of a particular activity in relation to its
intended outcome. External users are using the reports for different purposes.
The DBM and legislative bodies need performance reports for budget allocation
purposes. The Office of the President uses the reports for monitoring the
performance of the agency officials and as an input in the President’s State of the
Nation Address (SONA).

The NEDA uses the agency’s reports as basis for assessing the extent of
implementation of socio-economic and development programs of the
government. Other external users of reports are the general public and the
media.

3
 EXECUTIVE SUMMARY

AUDIT OBJECTIVE

The audit was conducted to assess the efficiency and effectiveness of

performance reporting system of the Product Standards Development and
Promotion program of the DTI giving consideration to the sufficiency of
performance indicators and the reliability, relevance, and completeness of
performance information.

AUDIT SCOPE AND METHODOLOGY

The audit covered the evaluation of performance reports rendered by six (6)
selected medium-sized government agencies for CYs 2001 and 2002 which
include the DTI. The team focused the evaluation on one of its programs, the
Product Standards Development and Promotion, implemented by the Bureau of
Product Standards (BPS). This program was formulated to establish standards for
all local products, test, and/or analyze standardized and non-standardized
products for purposes of certification, and extend technical assistance to
producers to improve the quality of their products. Specifically, the audit
evaluated product testing and certification. For CY 2002, the BPS received an
allotment of P 28.894 million which was fully obligated.

The team considered the following key criteria in assessing the effectiveness of
the performance reporting system:

 Complete and informative reporting

 Accurate and reliable reports
 Timely submission of reports
 Sufficient and appropriate performance indicators

To achieve the audit objectives, the team performed the following:

 Reviewed the existing performance reporting of the DTI and the

BPS insofar as it relates to the Product Standards Development and
Promotion program with emphasis on product testing and
certification.

4
 EXECUTIVE SUMMARY

 Evaluated the following reports:

 monthly, quarterly, semi-annual and annual reports for CY

2001 and selected months of 2002 of the BPS Testing
Center;
 2001quarterly reports of the Certification Division;
 2001 BPS quarterly and year-end report; and
 DTI published annual report for 2001.

 Conducted interviews with the staff involved in the preparation of

the reports.
 Visited the BPS Testing Center to understand the flow of reports and
to verify the validity of the data source.

The audit was conducted from November 18, 2002 to March 31, 2003 in
compliance with COA Office Orders Nos. 2002-518 and 518A dated November
15 and 25, 2002, respectively, and pursuant to Memorandum dated February 13,
2003.

AUDIT CONCLUSION

The existing performance reporting system of the DTI insofar as the Product
Standards Development and Promotion program is concerned as implemented by
the Bureau of Product Standards (BPS) needs improvement. This situation is
partly due to insufficient performance indicators to measure the achievement of
the objectives. The BPS’ primary objectives are to upgrade the quality of
product standards and to protect and safeguard the welfare of the consumers.

The team noted that the reports merely enumerate selected activities and outputs
accomplished during the period without relating such outputs to the program’s
intended results or outcome. This hinders the conduct of an effective evaluation
of the BPS’ performance. The report though, could be considered reliable and
timely as the information contained therein are based on reconciled and
verifiable accomplishment and submitted to the DTI on time.

Considering that reports are the windows of accomplishments and the agency’s
performance is assessed based on what was reported, the BPS should consider
improving the report contents to be reflective of the activities undertaken to
attain its objectives. For this purpose, the team included in the report
recommendations to address these concerns for consideration by the BPS and the
DTI.

5
 EXECUTIVE SUMMARY

MANAGEMENT’S REACTION TO AUDIT OBSERVATIONS

The audit highlights were forwarded to the DTI Secretary, copy furnished the
Director, BPS on October 16, 2003 for comments. Generally, the management
recognized the existence of the issues raised in the report and resolved to initiate
appropriate steps to improve their performance on reporting system. They
submitted explanations surrounding the existing performance reporting system
which were incorporated in the report, together with the team’s evaluation.

6
 Part II

About the Program

7
ABOUT THE PROGRAM

The Department of Trade and Industry (DTI)

Mandate

The DTI is a government agency under the Executive Branch, mandated to

coordinate, promote, facilitate and regulate trade, industry and investments. It
promotes and develops an industrialization program effectively controlled by
Filipinos and acts as catalyst for intensified private sector activity in order to
accelerate and sustain economic growth.

Objective and Strategy

The goal of the DTI is to grow and expand Philippine trade and industry in order
to generate more jobs, raise more income, and improve the life of the Filipinos.
In order to attain its objective, the DTI is guided by 5-point action strategy,
namely:

 Promoting and developing business, with focus on Small and Medium

Enterprises (SMEs);
 Preparing for the Knowledge Economy;
 Lowering the cost of doing business;
 Ensuring consumers get the best value for money; and
 Upgrading the quality of DTI governance.

Organization

There are 27 bureaus and attached agencies under the DTI with regional offices
and support services that contribute to the attainment of its objective. These
bureaus and agencies are classified into four groups, namely:

 Industry and Investment Group

 International Trade Group
 Consumer Welfare & Trade Regulations Group
 Regional Operation Group

8
 ABOUT THE PROGRAM

The focus of the audit is one of the programs handled by the Consumer Welfare
& Trade Regulations Group, the Product Standards Development and Promotion,
implemented by the Bureau of Product Standards (BPS). This program was
formulated to establish standards for all local products, to test, and/or analyze
standardized and non-standardized products for purposes of certification, and
extend technical assistance to producers to improve the quality of their products.
The program is aligned to one of the 5-point action strategies of the DTI in CY
2001 which is “Ensuring consumers get the best value for money”.

The Bureau of Product Standards (BPS)

Mandate

BPS is the national standards body of the Philippines established by Republic

Act No. 4109 and Executive Order No. 133. It is mandated to develop,
implement, and coordinate standardization activities in the Philippines. It is
primarily involved in standards developments and standards implementation/
promotion.

Objectives

The objectives of BPS are as follows:

 To upgrade the quality of Philippine products to enable them to

qualify and be competitive in both domestic and foreign markets;
 To protect and safeguard the interest of consumers and the public,
especially in matters of health and safety;
 To promote concern for the environment and efficient use of
natural resources; and
 To instill standards and quality consciousness among the Filipino
people.

9
 ABOUT THE PROGRAM

Activities

To achieve its objectives, the BPS performs the following activities:

Standards Development

The BPS, as the national standards body of the Philippines recognized by

the International Organization for Standardization (ISO), develops the
Philippine National Standards (PNS).

Product Certification and Testing

These activities include the following:

 Philippine Standards Certification Scheme

BPS operates a product certification scheme whereby manufacturers

secure licenses to use the Philippine Standard (PS) Quality and Safety
Marks. This mark signifies the manufacturers’ capability to
consistently manufacture products in accordance with a specific
Philippine National Standard (PNS) or an internationally accepted
foreign standard.

 Import Commodity Clearance

For imported products, the BPS runs the Import Commodity Clearance
(ICC) quality certification scheme. Under the scheme, ICCs are issued
to importers for shipments that have been found to conform to the
requirements of the relevant Philippine National Standards or
acceptable international or foreign standards.

 Product Testing

Before issuing PS Mark license, the BPS or any of its accredited

laboratories conduct product testing to verify conformity with the BPS
Standards.

10
 ABOUT THE PROGRAM

Laboratory Accreditation

The BPS Laboratory Accreditation Scheme (BPSLAS) covers the

accreditation of testing and/or calibration laboratories and formally
recognized laboratories that have established, implemented and maintained
technical competence and quality management systems that comply with
PNS 1600/ISO/IEC Guide 25 and other criteria for accreditation by BPS.

Accreditation of Assessment Bodies

This scheme covers the accreditation of conformity assessment bodies that

have complied with International Standards related to the conduct of third
party assessment.

Registration of Quality Assessors

The BPS national registration for quality assessors enlists individuals

whose performance and experience as quality assessors have been
evaluated and have been found to qualify with an established set of
requirements. The scheme makes available to industry a pool of qualified
assessors from which assessment services for quality certification to ISO
9000, product certification and laboratory accreditation can be availed.

Standards Promotion, Information and Training

BPS promotes its services, plans, programs and standardization activities

through the conduct of fora, seminars, exhibits, and publication of news
releases, memo circulars and advertisements both in print and broadcast
media.

11
 ABOUT THE PROGRAM

International Standards Work

Recognizing the benefits of international standards to Philippine trade and

industrial development, BPS is intensifying its participation in
international standardization activities.

In line with this function, the BPS reports to the DTI the number of product tests
conducted, Product Standard (PS) Mark licenses issued, and ICCs/Certificates of
Exemption, among others.

To have a better understanding of the functions of BPS, presented in the next

page is the Program Accountability Model indicating the activities undertaken,
the intended outputs and outcomes of the bureau and their relationship with the
bureau’s objectives.

Reporting System

The DTI prepares different reports for various purposes such as, accomplishment
reports for monitoring purposes, DTI inputs for the President’s SONA/Ulat sa
Bayan, and DTI Annual Report, among others. These reports are prepared by the
Office of Operational Planning (OOP) based on the reports submitted by the
different DTI offices and attached bureaus and agencies.

In compliance with the DTI reporting requirement, the BPS prepares and submits
quarterly, semestral and annual accomplishment reports containing
accomplishments of all Action Teams (ATs) of the bureau. The different
divisions/action teams of the BPS prepare monthly accomplishment report and
submit the same to the Information Services and WTO-TBT Enquiry Point (AT
2B). The latter consolidates the quarterly and semestral reports for submission to
the OOP, DTI. The reports were required to be submitted a week after the end of
the quarter for quarterly reports and last week of July and December in the case
of semestral reports. The BPS is also required to submit annual report on the last
week of December.

12
 Bureau of Product Standards
Program Accountability Model

Formulation/ Enforcement BPS &

Activity Development Product Product & Consumer Auditor’s International Laboratory
of Standards Testing Certification Assistance Registration Relations Accreditation Training
Scheme

Policies & Registered MRA’s

compliance w/
Output No. of Tests PS Mark/ ICC Monitoring Quality Different Fora
Accredited Trainings
Standards conducted Mark License Guidelines Assessors (APEC,SCSC) Laboratories conducted

Immediate To instill standards and quality consciousness among the Filipino people.
Objective To enable Philippine products to be competitive in both domestic & foreign market.

Intermediate
Objective To make Philippine products competitive both in domestic & foreign market

Ultimate
Objective To protect local consumers from unfair trade practices and ensure they get the best value for their money.

13
 Part III

Audit Observations
and
Recommendations

14
 Chapter 1

Complete and Informative

Reporting

15
COMPLETE AND INFORMATIVE REPORTING

INTRODUCTION

For reports to be considered useful, they should be, among others, complete and
informative. Reports are considered complete if they include both qualitative
and quantitative data adequate to assess the achievement of the objective. They
are complete and informative if they disclose information necessary to make the
reports clear and understandable so as not to mislead the readers. One of the
effective measures to ensure the generation of a complete and informative report
is a clear and well defined procedures on reporting which include a suite of
performance indicators.

Performance indicators are information about output performance or outcome

achievement, usually expressed as a unit, index or ratio. While they are not
considered as an exact measure of achievement, they provide indication of
agency performance. For this reason, each indicator should not be taken to
provide a conclusive picture of an agency's achievements. A suite of relevant
indicators which directly addresses the program objective is usually required for
each project to assess agency performance in the production of outputs and the
achievement of desired outcome.

The team, however, noted that the reported accomplishment of the BPS did not
provide sufficient information to assess the achievement of the program objective
of upgrading the quality of product standards and in protecting the welfare of the
consumers due to inadequate performance indicators.

OBSERVATION

The reported accomplishment of the BPS did not provide sufficient

information to assess the achievement of the BPS objective of upgrading
the quality of product standards and protecting and safeguarding the
welfare of the consumers due to insufficient performance indicators.
The reports did not include information on the number of products
tested in relation to the total products in the market subject to
mandatory testing and the percentage of products tested that were found
to conform with the required standards. This condition did not provide
the BPS an opportunity to assess the quality of products in the market
and the extent of the achievement of the program objectives. and to
address any deficiency to improve the existing system.

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 COMPLETE AND INFORMATIVE REPORTING

The BPS aims to, among others, upgrade the quality of Philippine products to
enable them to qualify and be competitive in both domestic and foreign markets
and to protect and safeguard the interest of consumers and the public, especially
in matters of health and safety. Among the activities undertaken by the BPS
toward this end are product testing and certification.

Under product testing and certification, the BPS determines the product’s
compliance with the BPS standards on the basis of satisfactory results of the
assessment of the manufacturer’s production and quality assurance processes and
products. Upon certification, the manufacturer of the product is granted a
license to use the Philippine Standard (PS) Quality and Safety Marks. This mark
signifies the manufacturer’s capability to consistently manufacture products in
accordance with a specific Philippine National Standard (PNS) or an
internationally accepted foreign standard.

For imported products, the BPS issues Import Commodity Clearance (ICC) to
importers whose shipments have been found to conform to the requirements of
the relevant Philippine National Standards or acceptable international or foreign
standards.

These activities were undertaken either by the BPS personnel or by the BPS
accredited testing center, laboratories or conformity assessment bodies.

As a matter of policy, the BPS prepares quarterly, semestral and annual reports
for submission to the DTI. Selected accomplishments of the BPS were then
included in the DTI Annual Report as follows:

Action Strategy Activity Accomplishment

Reducing the Cost of PS Mark Licensing 76 new licenses were issued

doing business 565 licenses were reassessed
545 PS licensees were upgraded
Import Regulation 2,283 certificates of exemption
issued to 1,544 companies
825 ICCs issued
Ensuring consumers get Standards 13,536 samples were tested of
best value for money Enforcement which 82,010 tests were
conducted by BPSTC

However, analysis of these accomplishments alone would not provide adequate

information to assess the achievement of the BPS objective of upgrading the
quality of products and protecting the welfare of the consumers. These
accomplishments cover mere activities and outputs without relating such outputs
to the intended results or outcome.

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 COMPLETE AND INFORMATIVE REPORTING

In this case, for BPS reports to be considered complete, significant information

that would provide a comprehensive assessment of the program should be
disclosed. The inclusion of the following information, among others, would
enhance the usefulness of the reports:

 clearly indicating the relationship of the activities undertaken with

the objective of product testing and presenting the extent of
achievement of objective using adequate performance indicators. The
purpose of the PS Mark licensing was, however, explained in the
report.

 including trend data (at least over the last three years) and a
discussion and analysis of changes over time.

The team noted though, that the BPS was measuring its performance using the
following indicators:

Activity/Key Result
Area Performance Indicators

Product Testing  No. of tests conducted (electrical & non-electrical)

 No. of test reports issued/submitted
 No. of companies served
 No. of product group tested

Product Certification  No. of new PS Mark licenses issued

 No. of licensees re-assessed
 No. of import commodity clearance issued
 No. of Certificate of Exemption issued

Registration of Quality  No. of Applications received

Assessors  No. of applicants registered
 No. of National Registration Scheme for Quality
Assessors (NRSQA) applications acted upon/
evaluated

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 COMPLETE AND INFORMATIVE REPORTING

Activity/Key Result
Area Performance Indicators P

Standards Enforcement  No. of market monitoring guidelines developed

and Consumer Protection
 No. of standards enforcement related training
modules developed
 No. of training courses implemented relative to
modules developed
 No. of special market monitoring activities and on
the spot factory inspection conducted
 No. of DAO 9 quarterly reports consolidated as
submitted by regional offices

Analysis of these indicators revealed that these all fall under one category of
indicators which is quantitative. To be able to properly measure the achievement
of a particular program, a suite of indicators composing of quantitative,
qualitative, timeliness and outcome indicators should be used. Some of the
indicators that may be considered follow:

Activity Indicator Significance

Product Testing
 Number of products  This is important in assessing the
tested broken down manufacturers’ consciousness on
into: product’s quality and standards. The
 increase in testing of non-mandatory
 Mandatory products indicates the manufacturers’
 Non-mandatory concern for quality and standards.
This information however could not
be derived at present as only the
number of tests conducted was
reported. Series of tests were
undertaken for a particular product.

 Percentage of products  This could measure the achievement

tested (mandatory) to of the BPS performance in protecting
total number of and safeguarding the consumers. The
products in the market presence of products without PS
Mark in the market poses danger to
subject to mandatory
consumers.
testing.

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 COMPLETE AND INFORMATIVE REPORTING

Activity Indicator Significance

 Number of products not A statistics on the number of products

passing the tests failing the test would indicate the state of
classified into: products in the market. This would also
provide infor+mation to consumers on the
 Mandatory quality of products in the market and input
 Non-mandatory to BPS/DTI market monitoring activities.

 Trend data on the

increase or decrease in
the percentage of
products not passing the
tests.
Product  Number of applications  Under the present system, only the
Certification received for product number of licenses issued was
certification reported. The performance therefore
of the BPS on issuing licenses could
not be assessed.

 Number of applications  This would also provide information

denied on the extent of compliance by the
manufacturers on existing standards.

 Number of PS Mark  It was reported though, that

license/ ICC/ Certificate
of Exemption processed
on time
processing time for PS application
and for ICC/Certificate of Exemption
was shortened from 2.5 years to 3-6
months and from 2-3 days to 8-24
hours, respectively.

 Percentage of licensees  While the number of re-assessed

passing the re- licensees is being reported, it did not
assessment provide information on whether these
products were still found to be
complying after re-assessment. This
is crucial in ensuring the
sustainability of product standards.

 Number of audits  One of the responsibilities of the BPS

conducted in relation to
issuance of PS Mark
license.
 Percentage of total
licensees audited within
the prescribed period
on PS Quality and/or Safety
Certification Mark Scheme under DTI
Department Administrative Order
(DAO) No. 01 series of 1997 dated
February 3, 1997 is the conduct of
conformity audits, among others,
through or in coordination with DTI
Regional/Provincial Offices, or in
case of foreign companies in
coordination with the BPS officially
recognized counterpart National
Standards Bodies, inspection and/or
certification bodies.

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 COMPLETE AND INFORMATIVE REPORTING

Activity Indicator Significance

The department order likewise provides

that the licensee shall be subject to at
least once a year audit to ensure
consistent compliance with the BPS
requirement on PS Quality and/or
Certification Mark Scheme.

 Number of audited  A statistics on the trend of the results

factories which did not of audit will give the reader a basis in
pass the audit assessing the quality of products
produced by these factories.

Considering, however, that product testing is also undertaken by BPS accredited

testing centers, the report should at least disclose the number of tests undertaken
by these testing centers. It would also be more informative if the causes/reasons
for the denial of issuing licenses or any adverse actions taken by the BPS could
be properly explained.

The team further noted that the reported accomplishment of the BPS and the DTI
on the issuance of ICCs and Certificates of Exemption do not include the
accomplishments of the DTI Regional/Provincial Offices where international
ports are located. The operations of these offices are independent from BPS and
are under the DTI Regional Operations Group. But for purposes of department-
wide reporting, their accomplishments in terms of issuance of ICCs and
Certificates of Exemption should be consolidated with those of the BPS.
Likewise, the team observed that the BPS accomplishments on “Standards
Development” were not included in the DTI Report when this was considered
significant in addressing the DTI program on “Product Standards Development
and Promotion.”

The absence of these information did not provide the BPS an opportunity to
assess the extent of achievement of the program objective and to correct any
deficiency in the existing system.

A well-prepared report can be an invaluable tool for decision-making, improving

program management, enhancing accountability and increasing public
confidence in the government Moreover, it is a general perception that holding
the agencies accountable for results is a key to a better and effective
performance.

Effective performance reporting should be able to show whether the condition of

Philippine products and the consumers have moved towards a desired outcome as
a result of government intervention.

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 COMPLETE AND INFORMATIVE REPORTING

Management’s Response Team’s Rejoinder

On the observations/recommendations, we The team appreciates the actions

would like to inform you that we have taken by the BPS on the report.
distributed the report for review and
comments/consideration by the concerned
division-BPS Testing Center and the
Product Certification. Rest assured that
corrective actions will be undertaken by
them on areas that the COA Team had
noted.
As discussed in the report, the final
Furthermore, we would like to stress that output reflected in the
the additional activities identified by COA accomplishment report are not
are already reflected in the individual staff sufficient to assess the attainment of
assignment, thus, only the indicators the objectives of the program. The
leading to final output are pointed out in DTI reports include only the number
the accomplishment report. of samples tested without relating
such accomplishment with the total
number of products in the market
subject to mandatory testing. The
reader then was not informed on the
extent of compliance on the safety
standard of the products in the
market.

We would like to inform you also that the We appreciate the innovations being
Office of Operational Planning has revised undertaken by the DTI to make the
its monthly physical report to improve the reports complete and informative.
DTI’s reporting system. All agencies are
now required to include in their
accomplishment reports both output and
outcome per activity for better appreciation
of the services of the DTI.

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 COMPLETE AND INFORMATIVE REPORTING

RECOMMENDATIONS

The BPS management should consider:

 including in the report, information about the BPS and its

activities that would make the report more informative such as
the following:

 The relationship of the activities undertaken with the BPS

objective and the extent these activities have contributed to
the attainment of the said objective;
 A disclosure that the report did not include
accomplishments of DTI field offices on activities which
are performed by both the BPS and DTI field offices such
as the issuance of ICCs and Certificates of Exemption;
 A disclosure that aside from the BPSTC, product testing is
also performed by BPS accredited laboratories. Also
include the total number of accredited laboratories as of
report date; and
 The number of products tested by BPSTC and by BPS
accredited laboratories out of the products issued PS Mark
and Safety license.

 formulating performance indicators, reflective of the

achievement of the objective. The BPS could consider the
indicators discussed in the report.

The DTI management should consider including in the report,

information about the BPS and its activities that would make the report
more informative such as the ollowing:

 The objectives of the significant activities of the BPS such

as Standards Development, Product Testing, and Product
Certification and relating how the output of these
activities contribute to the attainment of the objectives of
BPS and DTI as a whole;
 The corresponding performance indicators for the above-
mentioned activities; and
 Proper disclosures of information.

23
 Chapter 2

Accurate and Reliable Reporting

24
ACCURATE AND RELIABLE REPORTING

INTRODUCTION

Reports are being prepared for a specific purpose. In general, they are used to
measure performance, to monitor the extent of accomplishment, the efficiency of
the implementors, and for budgeting or decision-making purposes. They are also
used by different stakeholders such as the agency officials, the Congress, the
Office of the President, the DBM, the NEDA and the public in general.

These purposes could only be served if the reports rendered were accurate and
reliable. Reports are considered accurate and reliable if the information reported
are validated and free from systematic errors and biases. The team noted that
the BPS reports comply with these criteria.

OBSERVATION

Generally, the reports of the BPS could be considered accurate and

reliable. Except for some minor errors in the reported figures, the
reports were based on recorded accomplishments. Likewise the reported
accomplishments of the BPS, as reflected in the DTI, the BPS and the
concerned divisions’ records were the same.

The usefulness of the agencies’ performance data for decision-making ultimately

depends on the degree of confidence the users can have on the data. For reports
to be of use then, the agencies should produce performance data that are accurate
and valid. One way of ensuring that the data are free from systematic errors or
biases and that what was intended to be measured was actually measured is
through validation.

Field validation involves verification of reported accomplishments by

determining the actual accomplishment through physical count and or
review/investigation of source documents and other records used as a basis of
reporting. It also helps if performance data are collected and processed by
properly trained staff using adequate procedures to ensure that the performance
information gathered are accurate and documented.

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 ACCURATE AND RELIABLE REPORTING

The team focused its evaluation on the accuracy and reliability aspect of the
performance reporting on the reported accomplishments of product testing and
certification.

To validate the accuracy of the reported performance data, the team examined
and analyzed the monthly and quarterly reports of the BPSTC for CY 2001,
sample reports for CY 2002 and quarterly reports of the Product Certification
Division for CY 2001. The team likewise visited the BPSTC to familiarize with
its operations and to validate selected reported accomplishment from the data
source. The team also compared the 2001 reported accomplishment of the BPS
with the reported data in the DTI annual report.

The visits to the BPSTC disclosed that there are three types of laboratories
performing product testing. These are chemical, physical/mechanical and
electrical. Upon receipt of the request together with the sample product for
testing, the request is recorded in a logbook duly numbered. The product is then
tested in the appropriate laboratory. The type of tests to be conducted depends
on the request. On the 25th of the month, the cut-off date, each laboratory
prepares an accomplishment report for the month or quarter. These
accomplishment reports are consolidated in the BPSTC accomplishment report
which is submitted to the BPS on or before the end of the month.

The BPS reports then were based on documents and verifiable accomplishments.
The team also noted that the reports maintained by the BPSTC, the Certification
Division, the BPS and DTI in terms of the number of product tests conducted, PS
Mark licenses and ICCs/Certifcates of Exemption issued, were the same. This
further manifests the accuracy of the data reported.

Evaluation of the BPSTC monthly and quarterly accomplishment reports

however, revealed some mathematical errors as illustrated below:

Q U A N T I T Y
As As Difference
Particulars Reported Recomputed Over/(Under)

February 2002

Physical/Mechanical Laboratory
 No. of Product Group Tested 7 6 1
Wiring Devices
 No. of Product Group Tested 5 4 1
Total (Electrical)
 No. of Company Served in
terms of ICC issuance 73 19 54

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 ACCURATE AND RELIABLE REPORTING

Q U A N T I T Y
Difference
As As Over/
Particulars Reported Recomputed (Under)

March 2002

Physical/Mechanical Laboratory
 No. of Company Served – Local
2 10 (8)

Lamp and Related Device

 No. of Product Group Tested 7 6 1

November 2002

Appliances
 No. of Product Group Tested 3 4 (1)

These reports however were the ones submitted to the BPS and ultimately, the
DTI and form part of the Department-wide report. The errors then were carried
over.

RECOMMENDATION

The BPS management should consider strengthening the review of statistical

performance data to eliminate minor mathematical errors by identifying the
person responsible in reviewing the statistical data including his duties and
responsibilities.

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 Chapter 3

Timely Submission of Reports

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TIMELY SUBMISSION OF REPORTS

INTRODUCTION

Reports to be of use should be released at a time when the information is most

needed. For this reason, to ensure availability of data at any point in time,
reports are required to be submitted periodically, such as monthly, quarterly,
semi-annually or annually.

Reports which are submitted late or at the time they are no longer needed, no
matter how accurate or informative these may be, lose their value. The team
noted that BPS was submitting its reports to the DTI on a timely basis.

OBSERVATION

The BPS e-mail reports to DTI on time and submits hard copies at a
later date. This resulted in the inclusion of actual accomplishments of
the BPS selected activities in the DTI reports.

In compliance with the DTI requirements, the BPS prepares and submits
quarterly, semestral and annual accomplishment reports based on the
accomplishment of the different divisions/ATs which are consolidated by the
Information Services and WTO-TBT Entry Point or AT 2B.

Statistics on the submission of the hard copies of 2002 BPS accomplishment

reports, to the OOP-DTI, is shown below:

Date Rec’d by Delay

Report Due Date OOP (days)

First quarter 4-7-02 4-23-02 16

Second Quarter 7-7-02 6-28-02 Before due date
First Semester 7-31-02 6-28-02 -do-
Third Quarter 10-7-02 10-21-02 14

It can be gleaned from the above schedule that BPS was twice delayed in the
submission of reports. However, as disclosed in the interview, the reports were

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 TIMELY SUBMISSION OF REPORTS

sent thru e-mail within the due date. This therefore provides an opportunity to
the DTI to incorporate the BPS reports in the DTI reports. The submission of
reports was facilitated as the BPS does not have any Regional Office that is
normally the cause of delays.

RECOMMENDATION

DTI and BPS should continue the practice of preparing and releasing
reports within the prescribed deadline.

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Submitted in compliance with COA Office Orders Nos. 2002-518 and 518A
dated November 15 and 25, 2002, respectively, and pursuant to COA
Memorandum dated February 13, 2003.

ROSALINA R. VELASQUEZ MERLE M. VALENTIN

Team Member Team Member

LEONA A. ANDRIANO ELSIELIN C. MASANGCAY

Co-Team Leader Team Leader

NELIA C. VILLEZA
Team Supervisor

Reviewed by:

SUSAN P. GARCIA
Director III

Approved by:

ILUMINADA M.V. FABROA

Director IV

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