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Step Up Consulting Services was contracted by the Louis Berger Group, Inc. to draft the guidelines n Provincial Road Asset Valuation based on inputs from the Department of Public Works and Highways, the Department of Interior and Local Government, and Institute of Public Works Engineering Australia.
Road asset accounting is a problematic practice in the Philippines. The most recent pronouncement in road asset accounting was the New Government Accounting Systems (NGAS) promulgated in 2001 through COA Circular 2001-005. While the NGAS, through the NGAS Manual, prescribes the rules in accounting for road assets, the corresponding effect on financial statements is severe when the time the road assets are completed. Road assets on construction are debited to a Construction in Progress account but this is eventually closed to Government Equity account upon road asset completion. As a result, road assets are no longer valued in the financial statements but are only disclosed as Public Infrastructure in the Notes to Financial Statements.
This accounting treatment has several effects. Road assets are no longer treated as assets but expenses, theoretically, as the values are closed against the equity account. Correspondingly, monitoring these assets become virtually impossible because they are not considered as part of the fixed assets inventory, and thus, are not provided with depreciation. While road condition of the province has improved because of the rehabilitation, the provincial LGU’s value (represented by its equity account) decreased because the assets are technically charged against the equity account. Under normal circumstances, this could not have been possible. Asset acquisitions should have increased the net value of a local government unit.
This engagement is critical to ensure that road assets are valued in financial statements of local government units.
Step Up is among the five researchers/research teams granted with research funds by the Open Government Partnership (OGP) to undertake a study on the best method to build the capacity of civil society organizations on open government data. The action research entitled “Enhancing Citizen Engagement with Open Government Data” will be implemented in the next three months and is aimed at identifying the best approach to use in increasing citizen engagement with local governments through data sets published online.
The Step Up proposal was one of the more than 80 proposals screened by the OGP’s Open Data Working Group. Among the proposals submitted, Step Up made it to the top five, together with Open North, Inc of Canada, Mitrovic Development and Research Institute of South Africa, Mark Frank of the United Kingdom, and Sunlight Foundation of the United States. Step Up is the only research team from Asia.
The announcement from OGP can be found here.
Michael Canares, managing consultant of Step Up Consulting Services, presented his research entitled – “Full Disclosure Policy and its Impact on Local Governance in the Philippines”, in the recently concluded International Conference on the Theory and Practice of Electronic Governance held in the historic city of Gumaraes, Portugal. The research paper was one of the outputs of the Open LGU Research Project which Step Up implemented in 2013.
Mr. Canares also facilitated the session on Open Data Intermediaries together with Sumandro Chattapadhyay of Data Meet India. The study on Open Data intermediaries is one of the Web Foundation-funded synthesis papers on Open Data in Developing Countries research that Step Up manages together with a team of researchers from India and South Africa. In the session, Mr. Canares was joined by other members of the Open Data Research Network – Leo Mutuko of Ihub (Kenya), Sandra Elena of CIPPEC (Argentina), and Ricardo Matheus of Brazil.
ICEGOV is a series of International Conferences on Theory and Practice of Electronic Governance taking place annually around the world. The series focuses on the use of technology to transform the working of government and its relationships with citizens, businesses and other non-state actors in order to improve public governance and its contribution to public policy and development (EGOV).
The ICEGOV conference series is coordinated by the United Nations University Operating Unit on Policy-Driven Electronic Governance (UNU-EGOV), based in Guimarães, Portugal, in continuation of the work of the Center for Electronic Governance at UNU-IIST in Macao, China, which founded the ICEGOV series.
The City Government of Tagbilaran completed the review of its Executive-Legislative Agenda (ELA) last August 23, 2014. The three-day workshop, which culminated the series of preparatory workshops, fine-tuned the city’s ELA that was prepared in July 2013 before the 7.2 magnitude earthquake. And since the planning parameters changed dramatically, the need to come up with a plan that is relevant to the needs of the people and the City Government has become a necessity.
The event was attended by Mayor Baba Yap and the city department heads, the Sangguniang Panlungsod led by Vice-Mayor Jose Antonio Veloso and the city councilors, civil society representatives, representatives from the national government agencies, and the barangay captains. The workshop came up with prioritized the programs, projects, and activities that the city government will prioritize in 2015. Among these are the completion of the city hall’s repair, the provision of social and economic programs, and the needed rehabilitation of public infrastructure.
Step Up’s managing consultant, Mr. Michael Canares was the facilitator of the whole process including the pre-workshop activities that were conducted prior to the three-day workshop.
The Provincial Road Management Facility engaged Step Up Consulting to coach or mentor the Provincial Internal Audit Office (PIAO) of Lanao del Norte in order to strengthen the capacity of PIAO in three areas – conduct of audit engagement, audit report writing, and audit compliance monitoring system. The Step Up team was composed of Managing Consultant Michael Canares and Alvin Luis Acuzar, Learning Manager.
The mentoring process involved a combination of the following: (1) On-site mentoring consisting of a three-day theory-building exercise with concrete application on the audit of one priority risk area of the Provincial Engineer’s Office of Lanao del Norte.; and (2) and online mentoring on the actual engagement process and the writing of audit report. For this purpose, Step Up made use of Facebook as an online mentoring platform.
As a result of the engagement, the PIAO of the Provincial Government of Lanao del Norte was able to prepare its first Audit Engagement Plan which documents the planned, strategic, objective-based approach in conducting the audit of the Provincial Engineer’s Office. Conducting the audit activities based on planned work program is just part of the audit fieldwork process. The critical and important part is the audit documentation process through the preparation of working papers that became the basis in the preparation of audit findings and recommendations. The internal audit office was able to show improved competence both in the area of audit evidence-gathering and audit documentation. Finally, based on the results of the fieldwork as documented by the working papers, the Internal Audit Office was able to prepare audit findings and recommendations.
According to PIAO chief Chirelyn Leopoldo, the mentoring approach used by Step Up Consulting enabled them to learn audit concepts and apply them in actual work situations. As a result, they were able to complete a full audit cycle and prepare the audit report which they have recently presented to the Provincial Engineering Office, the auditee in this case.
Internal audit in the context of local government units is one of the expertise of Step Up Consulting. To date, it has assisted the provinces of Bohol, Bukidnon, Guimaras, Davao del Norte and Lanao del Norte.
Michael Canares, managing consultant of Step Up Consulting, was contracted by the Local Governance Support Program for Local Economic Development (LGSP-LED) to advise on results measurement and reporting processes since September 2013. Currently, Mr. Canares is now on the final phase of the consulting engagement which will culminate with the preparation of a manual on measuring local economic development that local government units can use.
“The Local Governance Support Program for Local Economic Development (LGSP-LED) is an eight-year (July 2008-July 2016) CAD $18 million collaborative project of the Canadian International Development Agency (CIDA) and the Philippines. It is implemented by a consortium of the Canadian Urban Institute (CUI) and the Association of Canadian Community Colleges (ACCC) acting as the Canadian Executing Agency (CEA). The CEA is working in partnership with the Philippine Department of Interior and Local Government (DILG). The Program purpose is to reduce poverty by strengthening local governance and supporting sustainable economic development. The Ultimate Outcome is expected to be improved local economic development for Filipino women and men.”(Dorotan and Frick, 2012, page 5).
LGSP-LED seeks to improve the measurement and tracking of local-level economic outcomes in the program, in particular those related to impact of the program’s activities on investment attraction, business formation and growth in enterprises (MSMEs). Mr. Canares’ work was to assist the CEA in developing a set of indicators (along with the related methods for collecting baseline data, data sources for ongoing tracking, collection methods, frequency and responsibility) that could be easily tracked by LGUs and/or their private sector partners (chambers of commerce, local business clubs).
The Provincial Road Management Facility contracted Step Up Consulting to conduct the capacity building activity for the Internal Audit Services Division (IASD) of the Province of Davao del Norte, one of its partner provinces. The engagement was designed to assist the IASD in developing and implementing an Internal Audit Plan for the identified road rehabilitation and maintenance systems and processes in order to come up with an Internal Audit report with doable and useful recommendations. Step Up Consulting team was composed of Managing Consultant Michael Canares, resource person Marilou Bueno, and documenter Cleofe Ambulo.
As a result of the engagement the IASD was able to plan, implement, write and present the audit report on one of the key risks in local road management to the risk owner, the Provincial Engineering Office. IASD was also able to craft a simple audit recommendations monitoring system to ensure that auditees will comply with audit recommendations and improved internal control processes in their daily operations.
One of the activities of the mentoring process was an international online course on internal audit where four of the IASD staff members were enrolled in. After the course, the auditors completed an online assessment where two of the staff members got a 100% rating in the examinations.
Step Up made use of a mentoring-focused approach where capacity development needs were assessed on a regular basis so that interventions designed will be able to sufficiently meet competency gaps and produce the desired outputs. The engagement was conducted in April to June 2014 with a mixture of on-site and on-line mentoring. This was also the first time that Step Up used Facebook as an online-mentoring tool where mentees can directly ask questions from mentors and where files are shared and outputs are submitted and commented on.
IASD staff members appreciated the whole mentoring approach and the engagement was rated very satisfactory by the participants.