EXECUTIVE SUMMARY

A. Introduction

The Optical Media Board (OMB) was created pursuant to Republic Act (RA)
No. 9239 known as the Optical Media Act of 2003 which was approved on February
10, 2004. It is mandated to regulate the mastering, manufacture, replication,
importation and exportation of optical media in all forms. Its authority covers the
entire territory of the Republic of the Philippines including the economic zones as
defined both under RA Nos. 9239 and 7916.

OMB is governed by a Board composed of four ex-officio members and five

regular members, all appointed by the President. It is headed by a Chairperson,
chosen from among the five regular members, who is also the Chief Executive Officer
(CEO). It has a Secretariat headed by an Executive Director who assists the
Chairperson/CEO in the day-to-day operations.

OMB is headed by Chairperson Jeremy S. Marquez and assisted by Executive

Director Christine L. Suntay. As of year-end, 68 of the 77 authorized plantilla
positions were filled up. In addition, the regular positions of OMB were
complemented by 18 job order personnel. There are four divisions namely:
Administrative and Finance Division (AFD), Legal Division (LD), Registration and
Licensing Division (RLD) and Enforcement and Investigation Division (EID).

B. Operational Highlights

The following are the reported Agency's operational highlights and

accomplishments for calendar year (CY) 2022:

Percentage of
Particulars Target Accomplishments
Accomplishment
OPERATIONS: Optical Media Industry Regulation Program
Output Indicators
Performance Indicator 1: Licensing/ Registration
Percentage of registrations and
licenses acted upon within the 97 100 103.09
prescribed timeframe
Performance Indicator 2: Monitoring and Enforcement
Number and percentage of
Inspection Orders served on
2,600 2,389 91.88
Optical Media establishments
acted upon within the prescribed
100 91.88 91.88
timeframe.

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 Percentage of
Particulars Target Accomplishments
Accomplishment
The low percentage of
accomplishment is due to
the conduct of inspections
solely in National Capital
Region (NCR) in the first
semester while partial areas
in Region III and IV in the
second semester.
Performance Indicator 3: Prosecution
Percentage of:
a. Administrative cases
100 100 100
filed/charged within 15 days
b. Clearances issued within the
100 100 100
day

C. Financial Highlights

The financial position, financial performance and sources and utilization of

funds of OMB for CY 2022, with corresponding figures for CY 2021, are presented
below:

Particulars 2022 2021

Financial Position
Assets 55,116,224.40 56,969,332.46
Liabilities 2,094,682.44 5,029,351.16
Net Assets/Equity 53,021,541.96 51,939,981.30
Financial Performance
Revenue 46,774,118.61 48,484,881.79
Current Operating Expenses 71,611,333.76 72,029,213.34
Net Financial Assistance/Subsidy 73,964,473.26 71,722,358.70
Sale of Assets 0.00 7,225.00
Losses 0.00 (39,094.73)
Surplus/(Deficit) 49,127,258.11 48,146,157.42
Sources and Utilization of Funds
Appropriations 78,430,859.00 71,525,810.00
Allotments 78,430,859.00 71,525,810.00
Continuing Appropriations 1,763,072.23 2,912,876.96
Obligations Incurred 71,459,134.62 70,718,409.25
Disbursements 69,739,406.01 66,144,473.44
Unobligated Allotments 8,734,796.61 3,720,277.73

The Statement of Appropriations, Allotments, Obligations, Disbursements and

Balances for CY 2022 is shown in Annex A.

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D. Scope of Audit

The audit covered the accounts and operations of the OMB for CY 2022. It was
conducted to: a) ascertain the level of assurance that may be placed on the
Management’s assertions on the financial statements; b) determine the propriety of
transactions as well as extent of compliance on applicable laws, rules and regulations;
c) recommend agency’s improvement opportunities; d) determine the extent of
implementation of prior year’s audit recommendations. Moreover, the audit was
conducted in accordance with International Standard of Supreme Audit Institutions
(ISSAI).

E. Auditor’s Report on the Financial Statements

The Auditor rendered an unmodified opinion on the fairness of presentation of

the financial statements of OMB as at December 31, 2022.

F. Summary of Significant Observations and Recommendations

The following are the audit observations and recommendations which were
discussed with Management officials concerned during the exit conference conducted
on March 13, 2023. Management views and comments were incorporated in the
report, where appropriate.

1. Semi-expendable Property Card (SPC), Registry of Semi-expendable Property

Issued (RSPI), Receipt and Returned Semi-expendable Property (RRSP) and
Report of Semi-expendable Property Issued (RSPI) were not maintained by the
Property and Supply Unit (PSU) contrary with the provision of Item 4.7 of COA
Circular No. 2022-005 dated May 31, 2022.

We recommended and Management agreed to instruct the PSU Head to

prepare and maintain SPC, RegSPI, RRSP and RSPI for the semi-expendable
properties of OMB to strengthen the controls over semi-expendable properties.

2. Semi-expendable properties and Office Equipment per Inventory and Inspection

Report of Unserviceable Property (IIRUP) amounting to ₱742,131.20 and
₱90,000.00, respectively, were found to be unserviceable and remained undisposed
as at December 31, 2022, contrary to the provision of National Budget Circular
(NBC) No. 425 thereby, exposing these assets to further deterioration and
diminishment in values and, has been depriving the Agency of the space occupied
by these properties to be used for other purposes and the government of any benefit
or income that may be derived from its disposal.

We recommended and Management agreed to instruct the PSU head to

facilitate the immediate disposal of idle, obsolete and unserviceable semi-

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 expendable properties and Office Equipment per IIRUP that were no longer used
by the agency and/or those that will no longer provide economic benefits to the
agency in accordance with the NBC No. 425, as their value diminished due to the
passage of time and exposure to elements and to enable the Agency to use the
storage areas for other purposes.

3. Payment of Special Counsel Allowance totaling ₱121,410.00 was made to OMB

lawyers despite non-compliance with the requirements of Section 59 of the General
Provisions (GP) of General Appropriations Act (GAA) for Fiscal Year (FY) 2022.
Likewise, complete documentary requirements prescribed in Item 5.6 of COA
Circular No. 2012-001 dated June 14, 2012 could not be provided.

We recommended and Management agreed to require the:

a) claimants to refund the Special Counsel Allowance received since they

were not entitled as the requirements for such allowance were not
complied; and

b) accountant to review the qualification of the claimants in accordance

with the requirements of Section 59 of the GP of FY 2022 GAA before
processing the claim and if found qualified, check the adequacy,
proprietary and completeness of the supporting documents prescribe by
Item 5.6 of COA Circular No. 2012-001.

4. Payments of Hazard Pay amounting to ₱518,000.00 were not supported with the
complete documentary requirements in compliance with Item 5.8 of COA Circular
No. 2012-001 and Item 3.2.b of CSC Memorandum Circular (MC) No. 18, series
of 2020, thus, validity and accuracy of such payment could not be ascertained.

We recommended and Management agreed to instruct the:

a. Human Resource Unit (HRU) to submit copies of the Special

Orders/Memoranda enumerating the list of employees and personnel
authorized to work during ECQ and MECQ;

b. Accountant to ensure that claims against government funds are duly

supported with complete documentation.

5. Excessive payments of Hazard Pay totaling ₱4,000.00 to two Job Order (JO)
personnel who had not physically reported for work within the prescribed official
working hours.

We recommended and Management agreed to require the:

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 a. claimants of excessive Hazard Pay to refund the same as they had failed
to physically report to the office within the prescribed official working
hours of the agency; and

b. accountant to strictly review and check whether the claims of Hazard Pay
are correctly computed based on the days wherein the employees and
personnel have physically reported to the office within the prescribed
official working hours.

6. Non-essential workers or personnel whose services are not critical pursuant to CSC
MC No. 18 and IATF Omnibus Guidelines on Community Quarantine reported for
work and were paid hazard pay totaling ₱81,500.00.

We recommended that the Management to require all JO personnel recipients

to refund the payment of the unnecessary Hazard Pay due to non-observance of the
COVID-19 virus mitigation measures provided in CSC MC No. 18, s. 2020, and
the IATF Omnibus Guidelines on Community Quarantine.

G. Status of Implementation of Prior Year’s Audit Recommendations

Of the seven audit recommendations contained in the CY 2021 Annual Audit

Report (AAR), five were implemented and two were not implemented. The details
are presented in Part III of this report.