The Social Security System (SSS) has received an “unmodified” opinion from the Audit Commission (COA) for its financial statements for calendar year 2020, with the highest audit rating that can be given to government agencies by state auditors.
We have rendered an unmodified opinion on the fair presentation of SSS’s financial statements as at December 31, 2020 and 2019 and for the years ended on those dates, with an emphasis on the recognition of insurance contract liabilities in the SSS financial statements in accordance with the national government directive policy requiring public insurance institutions to adopt the PFRS [Philippine Financial Reporting Standard] 4 – Insurance contracts in force for the year 2020 ”, stated the auditor’s opinion in the summary of the COA’s annual audit report on the SSS.
An unmodified opinion means that the auditor has been satisfied with the financial statements submitted because they have met regulatory requirements and have been prepared in accordance with accounting principles, criteria and standards.
SSS President and CEO Aurora C. Ignacio gratefully accepted the COA’s audit opinion on the 2020 financial report. She said that despite the COVID-19 pandemic, the SSS continued to continue its mandate of providing meaningful social security protection to its members and their beneficiaries through a culture of management excellence based on sound and effective policies and best practices.
“For the year 2020, SSS’s total cash inflows from the collection of membership dues and proceeds from investments and other income reached 231.51 billion pesos, exceeding its total cash outflow of 205.52 billion. of pesos from payments to members and beneficiaries and payments for operations, resulting in net cash generated from operating activities of 25.99 billion pesos, ”said Ignacio.
SSS assets in 2020, on the other hand, increased by 38.61 billion pesos or 6.4% to 639.99 billion pesos from 601.38 billion pesos in 2019.
With the change in its financial reporting standard as of its 2020 financial statements, SSS’s social benefit liability (SBL) is now presented in its liabilities. In previous years, SSS’s SBLs were presented in the Notes, which are an integral part of its financial statements.
The SSS also indicated that, based on its 2019 actuarial valuation, the life of its fund is expected to last until 2054.