THE National Power Corp. (NPC) had P3.070 billion in power receivables that remained uncollected for more than 10 years as of end-2025, depriving the state-run agency of funds that could have supported its operations, state auditors said.
In its 2025 annual audit report, the Commission on Audit (CoA) said the long-outstanding receivables deprived NPC of resources that could have been used to finance its operations, raising concerns over the agency’s collection efficiency and management of government funds.
“The long outstanding receivables of more than 10 years totaling P3.070 billion remained uncollected as at December 31, 2025,” CoA said.
The auditors said the failure to collect the receivables limited the funds available to NPC for its operations, particularly its mandate to provide electricity to areas not connected to the main power grids.
CoA also raised concerns over the financial sustainability of NPC’s missionary electrification operations, citing insufficient subsidies, rising petroleum prices, uncollected power bills and delays in the collection of Universal Charge funds.
The Universal Charge for Missionary Electrification (UC-ME), remitted to NPC by the Power Sector Assets and Liabilities Management Corp. (PSALM), serves as a subsidy for the agency’s missionary electrification functions, which include supplying electricity to off-grid areas.
“The UC-ME remitted to NPC by PSALM… was insufficient in view of the increasing prices of petroleum products used in the operation of power generators, non-collection of long overdue power receivables, and untimely collection of UC Funds, which compromise the continued delivery of power supply to off-grid areas,” CoA said.
These financial pressures contributed to NPC recording a net deficit of P3.282 billion in 2025, more than double the P1.529-billion deficit recorded in 2024.
The agency’s financial position was strained by reduced net financial subsidies and higher operating costs, further affecting its capacity to sustain operations.
CoA also flagged 19 garnished depository accounts amounting to P300.822 million that remained unresolved due to missing documentation.
The audit report further identified P983.750 million in unsettled audit disallowances, referring to expenditures that auditors had found irregular or otherwise subject to disallowance.
CoA rendered a qualified opinion on NPC’s 2025 financial statements after identifying P737.638 million in unreconciled accounting discrepancies involving inventory, inter-agency receivables, and trust fund accounts.
The largest variance involved P314.071 million in fuel, oil and lubricants inventory between the records of NPC’s finance office and its physical inventory count.
State auditors said they could not verify the recorded inventory balance because of unreconciled differences and a lack of supporting documents, preventing them from determining whether adjustments to the financial statements were necessary.
Another P250.829-million discrepancy involved inter-agency receivables between NPC’s records and those of PSALM, while P172.738 million remained unreconciled in Universal Charge-Environmental Charge trust accounts.
CoA directed NPC management to strengthen its reconciliation procedures, require overdue electric cooperatives to submit debt-restructuring proposals and exhaust legal remedies to recover outstanding receivables.
It also urged the agency to address unresolved audit disallowances and improve the management of its financial resources. — Pexcel John Bacon