EXECUTIVE SUMMARY

A. Introduction

The Philippine National AIDS Council (PNAC) was created by virtue of Executive
Order (EO) No. 39 dated December 3, 1992 as a national policy and advisory body in the
prevention and control of infection in the Philippines. It was created in recognition of the
increasing number of Filipinos infected with Human Immunodeficiency Virus (HIV) and
succumbing to the Acquired Immunodeficiency Syndrome (AIDS) disease; the need for an
increased societal response from government agencies, non-governmental organizations,
private volunteer groups and other parties; and, the appropriate responses of other
government agencies in formulating and implementing policies and programs to contain
the spread of HIV.

The PNAC advises the President of the Republic of the Philippines regarding policy
development for the prevention and control of AIDS; ensure the avoidance of legal
provisions which may impede the implementation of the national AIDS prevention
strategy; and work in collaboration with other organizations and agencies to overcome
discriminatory attitudes.

Relative thereto, Republic Act (RA) No. 8504 known as the Philippine AIDS
Prevention and Control Act of 1998 was enacted and reconstituted PNAC to enable it to
oversee an integrated and comprehensive approach to HIV/AIDS prevention and control
in the Philippines. RA No. 8504 also provided that PNAC shall be attached to the
Department of Health (DOH). It was superseded by RA No. 11166 also known as the
Philippine HIV and AIDS Policy Act of 2018, which provides that PNAC shall be
reconstituted and streamlined to ensure the implementation of the country’s response to the
HIV and AIDS situation. It provides that PNAC shall be an agency attached to the DOH
with a separate budget under the General Appropriation Act (GAA) and shall have its own
secretariat and staffing pattern headed by the Executive Director who shall be under the
direct supervision of the Chairperson of the PNAC.

The membership and composition of PNAC comprise the government agencies and
Civil Society Organizations (CSOs) with direct contributions to the performance of the
core functions of the PNAC (oversight, direction setting and policy making); with existing
programs services and activities that directly contribute to the achievement of the AIDS
Medium Term Plan (AMTP) and with existing constituencies that are targeted by the
AMTP’s objectives and activities. As of December 31, 2022, the following agencies and
CSOs represent the PNAC:

National Government Agencies:

1. DOH (Permanent Chairperson)
2. Department of Social Welfare and Development (DSWD)
3. Department of Education (DepEd)
4. Department of Labor and Employment (DOLE)
5. Department of Budget and Management (DBM)

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 6. Department of the Interior and Local Government (DILG)
7. Chairperson of the Committee on Health and Demography of the Senate of the
Philippines or his representative
8. Chairperson of the Committee on Health of the House of Representatives or
his representative;
9. Commission on Higher Education (CHED)
10. CSO
11. National Youth Commission (NYC)
12. Philippine Information Agency (PIA)

Civil Society Organizations

13. Action for Health Initiatives
14. Positive Action Foundation Philippines Inc.
15. Alagad Mindanao
16. AIDS Society of the Philippines
17. The Library Foundation Share Inc.
18. Pinoy Plus Inc.
19. Pilipinas Shell Foundation Inc.

The members of the PNAC, in cooperation with CSOs and in collaboration with
the Department of Justice (DOJ) and the Commission on Human Rights (CHR) shall ensure
the delivery of non-discriminatory HIV and AIDS services by the government and private
HIV and AIDS service providers.

Dr. Joselito R. Feliciano is the Officer-in-Charge of the PNAC Secretariat, and is

supported by the three Division Chiefs for the Research Planning, Policy, and Monitoring
and Evaluation Division (RPPMED); Program Information and Partnership Development
Divisions (PIPDD); and Administrative Division (AD). PNAC has a total of 28 personnel
composed of 21 permanent personnel and seven job order (JO) personnel assigned in
various offices as of December 31, 2022. The seven JO personnel serve as additional
workforce to the regular plantilla employees and provide administrative/technical
assistance and such other related functions as may be assigned. The payment of their
services is charged against the Maintenance and Other Operating Expenses (MOOE)-Other
Professional Services of the General Fund.

B. Operational Highlights

The PNAC has reported the accomplishments for Calendar Year (CY) 2022. The
details are on the next page:

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 Percentage of
Physical
Activity/Performance Indicator Physical Target Accomplishment
Accomplishment
to Target
NATIONAL HIV & AIDS MANAGEMENT PROGRAM
OO: Improved access to HIV and AIDS preventive, curative health care services, rehabilitative and
restorative care
Outcome Indicators
1. Percent of RA No. 11166 related 85% 100% 118
policies developed/approved by the
PNAC
2. Client Satisfaction rating of both
internal and external stakeholders
a. PNAC Committees At least >70% or 92% 131
very satisfactory
average rating
b. National Government At least >80% or 93% 116
Agencies (NGAs), Local very satisfactory
Government Units (LGUs), average rating
Development Partners (DPs), CSOs,
and Individuals
Output Indicators
1. Percent of RA No. 11166 related 95% 100% 105
polices drafted and finalized within
the required date of completion
2. Number of plans/reports prepared
and submitted within schedule to
the PNAC
a. Committee Plans 5 5 100
b. Annual Report 1 1 100
c. PNAC Plan 1 1 100

C. Financial Highlights

The following are the PNAC’s financial condition, results of operations, and
sources and applications of funds for CY 2022:

Financial Condition
Particulars CY 2022 (₱)
Financial Condition
Assets 206,917.79
Liabilities 1,365,306.82
Net Assets/Equity (1,158,389.03)

Results of Operation
Particulars CY 2022 (₱)
Revenue 0.00
Expenses 21,896,645.14
Net Financial Subsidy 20,752,256.11
Surplus/(Deficit) (1,144,389.03)

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 Sources and Application of Funds
Programs/ Unobligated
Appropriation Allotment Obligation Disbursement
Projects/ Allotment
(₱) (₱) (₱) (₱)
Activities (PPA) (₱)
General 30,675,000.00 30,675,000.00 16,708,442.37 15,416,981.80 13,966,557.63
Management and
Supervision
HIV and AIDS 2,788,000.00 2,788,000.00 2,730,861.27 2,688,053.26 57,138.73
Policy and
Standards
Development
Technical and 1,529,000.00 1,529,000.00 1,529,000.00 1,529,000.00 0.00
Administrative
Support to PNAC
Total New 34,992,000.00 34,992,000.00 20,968,303.64 19,634,035.06 14,023,696.36
Appropriations
Retirement and 1,096,776.00 1,096,776.00 1,023,186.20 1,023,186.20 73,589.80
Life Insurance
Premium
Total Automatic 1,096,776.00 1,096,776.00 1,023,186.20 1,023,186.20 73,589.80
Appropriation
Grand Total 36,088,776.00 36,088,776.00 21,991,489.84 20,657,221.26 14,097,286.16

D. Scope of Audit

The audit covered the accounts and operations of PNAC for the year ended
December 31, 2022. The audit was conducted to: (a) verify the level of assurance that may
be placed on management’s assertions on the financial statements; (b) recommend
agency’s improvement opportunities; and (c) determine the propriety of transactions as
well as the extent of compliance with pertinent laws, rules and regulations.

E. Independent Auditor’s Report

A qualified opinion was rendered on the financial statements of the PNAC as at

December 31, 2022 due to a misstatement overstating the balances of the Assets and Equity
accounts by ₱201,925.93, representing 97.59 percent and 17.43 percent of the total assets
and equity, respectively

F. Summary of Other Significant Observations and Recommendations

The other significant audit observations and recommendations noted were

discussed in detail with the concerned management officials during the exit conference
held on April 3, 2023. Management’s views and comments were incorporated in the report
where appropriate.

1. The failure to observe the allowed minimum 10 days of monetization of vacation leave
for the two employees amounting to ₱60,170.37 constitutes a violation of the
guidelines set by Civil Service Commission (CSC) Resolution No. 98-3142 and
indicates lapses in the internal controls on the validity of claims.

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 We recommended that Management require the Accounting Head and Human
Resource Management Office (HRMO) Head to undergo regular training on
relevant regulations, policies, and guidelines, including those set by the CSC to
enhance the knowledge and understanding of their roles, and responsibilities;
and be aware/ kept posted on the laws, rules, and regulations.

2. The failure to fill up the unfilled plantilla positions of the PNAC-Secretariat which
resulted in the reversion of ₱24,516,002.42 to the Bureau of Treasury (BTr) and the
lapse of unutilized allotment amounting to ₱12,963,126.05 as of December 31, 2022
signifies the PNAC’s inefficient utilization of public funds and weak implementation
capabilities. Further, there were deficiencies noted on the reported Current
Disbursement in Financial Accountability Report (FAR) No. 1 vs. FAR No. 4 and the
generated report of Tax Remittance Advice (TRA) from electronic New Government
Accounting System (eNGAS) vs. FAR No. 4 in the amount of ₱178,857.43 and
₱6,134.19, respectively, hence, cast doubts on the reliability of the submitted financial
accountability reports.

We recommended that the Management:

a) direct all Division Heads to:

i) identify number of filled plantilla position that requires cash operating

expenditure and lists of Programs/Projects/Activities (PPAs) that can be
implemented during the year, and immediately submit the necessary
information to the Budget and Accounting Office for consideration in
the preparation of the Monthly Disbursement Program (MDP);

ii) monitor closely the implementation of PPAs to ensure its timely

completion thereof and full utilization of funds; and

b) require the Accounting and Budget Heads to closely coordinate with each
other and conduct review and reconciliation of the Budget Execution
Documents (BEDs) and FARs before the finalization and submission of the
reports to the COA and DBM.

G. Status of Suspensions, Disallowances and Charges

As of December 31, 2022, there are no Notice of Suspension, Notice of

Disallowance or Notice of Charge issued.

H. Status of Implementation of Prior Years’ Audit Recommendation

The PNAC is on its first year of implementation as an attached agency of DOH,

thus, there are no prior year audit recommendations.