COA DISALLOWANCES:
WINNING WITHOUT WHINING
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REMEDIES ON COA DISALLOWANCE
I. Fundamental Principles Governing Financial
Transactions
II. Relevant Constitutional Mandate of COA
III. COA Key Services: Audit Services
IV. General Requirements for All Types of
Disbursement
V. Procedure in Appeals Before COA
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FUNDAMENTAL PRINCIPLES GOVERNING FINANCIAL TRANSACTIONS
Sec. 4 of PD 1445
1. No money shall be paid out of any public treasury or depository except in
pursuance of an appropriation law or other specific statutory authority.
2. Government funds or property shall be spent or used solely for public
purposes.
3. Trust funds be available and may be spent only for the specific
purpose for which the trust was created or the funds received
4. Fiscal responsibility shall, to the greatest extent, be shared by all
those exercising authority over the financial affairs,
transactions, and operations of the government agency.
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5. Disbursements or disposition of government funds and property
shall invariably bear the approval of the proper officials.
6. Claims against government funds shall be supported with
complete documentation.
7. All laws and regulations applicable to financial transactions
shall be faithfully adhered to.
8. Generally accepted accounting principles and practices as well
as of sound management and fiscal administration shall be
observed, provided that they do not contravene existing laws
and regulations.
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RELEVANT COA CONSTITUTIONAL MANDATES
(Article IX-D of the 1987 Philippine Constitution)
1. Examine, audit and settle all accounts pertaining to the revenue and
receipts of, and expenditures or uses of funds and property owned or
held in trust by, or pertaining to, the government. [Section 2(1)]
1. Promulgate accounting and auditing rules and regulations including
those for the prevention and disallowance of irregular, unnecessary,
excessive, extravagant or unconscionable expenditures, or uses of
government funds and properties. [Section 2(2)]
3. Recommend measures to improve the efficiency and effectiveness of
government operations. (Section 4)
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COA KEY SERVICES
AUDIT SERVICES
1. Regular Audit . . .
Performance Audit- review of management efficiency with the end in view of eliminating waste and
promoting efficient use of public funds and resources and the ascertainment of the agency’s
effectiveness by determining whether desired results have been achieved and programs have
accomplished their purposes and objectives.
2. Special Audit
The Special Audits Office (SAO) of the Special Services Sector (SSS) conducts performance audits
a. Agency-based approach - audit of a particular program, project or activity of a selected agency.
b. Government-wide audit -simultaneous examination of a management function or activity in a
number of government agencies
c. Sectoral Audit - audit of programs or activities that are delivered by more than one government
agency.
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AUDIT SERVICES
The SAO is also tasked to conduct other special audits, as follows:
a. Rate Audit – pertains to the examination and audit of the books,
records and accounts of public utilities in connection with the fixing of
rates of every nature.
b. Levy Audit – pertains to the audit of non-government entities required
to pay levies or government share.
c. Subsidy Audit – pertains to the audit of non-government entities
subsidized by the government or government authority
3. Fraud audits
The Fraud Audit Office (FAO) of the Special Services Sector conducts
audits of government agencies with probable fraudulent transactions to
safeguard government assets against abuse and fraud and to respond to
the increasing public demand for fidelity in the use of government funds
and properly.
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GENERAL REQUIREMENTS FOR ALL TYPES OF
DISBURSEMENTS
1. Certificate of Availability of Funds issued by the Chief
Accountant
2. Existence of lawful and sufficient allotment duly
obligated by authorized officials
3. Legality of transactions and conformity with laws, rules
or regulations
4. Approval of expenditure by Head of Office or or his
authorized representative
5. Sufficient and relevant documents to establish validity
of claim
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Auditor
Regional Director
Commission Proper
30 days
6 months
APPEALS IN COA DISALLOWANCE: PROCEDURE
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Supreme
Court under
Rule 65
APPEALS: PROCEEDINGS BEFORE THE AUDITOR
Regular/Special/ Fraud Audit /
Notice of
Suspension/Disallowance/Charge
/ Relief from Accountability
Audit Observation
Memorandum
Motion for Reconsideration?
NOT ALLOWED
Reply to AOM
Gather Vouchers and
Supporting Documents
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APPEALS: PROCEEDINGS BEFORE THE REGIONAL DIRECTOR
APPEAL MEMORANDUM
++
DECISION
ANSWER by Appellee
15 days after submission of last
pleading
REPLY by Appellant/REJOINDER
by Appellee
MOTION FOR
RECONSIDERATION? NOT
ALLOWED
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APPEALS: PROCEEDINGS BEFORE THE COMMISSION PROPER
PETITION FOR REVIEW
(in 5 copies, + +, with certified
copies of Decision +)
ORDER to Answer & Transmittal
of Records (5 days from receipt
of Petition)
ANSWER by Respondent within
15 days from receipt of Order
REPLY by Petitioner 15 days
from receipt of Answer
DECISION
(60 days from the time it is submitted for
resolution)
MOTION FOR RECONSIDERATION? Only
(1) MR is allowed: evidence is
insufficient to justify the decision; or
that the said decision is contrary to law
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APPEAL TO THE SUPREME COURT
PETITION FOR REVIEW
ON CERTIORARI
+
DECISION
ANSWER by Appellee
MOTION FOR
RECONSIDERATION? ONLY ONE
MOTION FOR RECONSIDERATION
REPLY by Appellant/REJOINDER
by Appellee
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FINALITY OF DECISION
Rule IV, Section 8. Finally of the Auditor's decision (of
Regional Director) - Unless an appeal to the Director is
taken, the decision (ND/NS) shall become final upon
the expiration of six (6) months from the date of receipt
thereof.
Rule X, Section 9. Finality of Decisions or Resolutions. become final and executory after the lapse of thirty (30)
days from notice, unless a motion for reconsideration is
seasonably made or an appeal to the Supreme Court is
filed.
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RULE XIII: ENFORCEMENT & MONITORING OF
DECISION (NOTICE OF FINALITY OF DECISION)
Section 1. Execution of Decision. - shall issue upon a decision
that finally disposes of the case; shall issue as a matter of
right upon the expiration of the period to appeal therefrom if
no appeal has been fully perfected.
Section 2. Notification of Finality of Decision (NFD) - An NFD
directing the persons liable to pay/refund the amount
disallowed shall be issued by the following officials, upon a
decision that has become final and executory.
a) Auditor - for ND/NDC or Decision issued by him.
b) Director who supervised the special audit team - for
ND/NDC issued by the audit team.
c) Director - for decision rendered by him.
d) Commission Secretary - for decision of the CP
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RULE XIII: ENFORCEMENT & MONITORING OF
DECISION (NOTICE OF FINALITY OF DECISION)… CON’T
Section 3. COA Order of Execution - In case of failure of the
person(s) liable to refund the amount disallowed/charged
as provided in the preceding section, the COE directing the
Cashier/Treasurer/Disbursing Officer to withhold payment of
any money due such person(s) shall be issued by the
following.
a) Director - for NFDs issued by him and the by Auditor.
b) General Counsel - for NFD issued by him and by the
Commission Secretary, and for judgments rendered by the
Supreme Court.
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RULE XIII: ENFORCEMENT & MONITORING OF
DECISION (NOTICE OF FINALITY OF DECISION)… CON’T
RRSA: 5.4 An audit suspension or disallowance/charge shall
be settled by the persons responsible or liable therefor
through compliance with the requirements, or
payment/restitution or by any of the modes of
extinguishment of obligation provided by law, respectively. A
notice of Settlement of Suspension/DisallowanceCharge
(NSSDC) shall be issued for such settlement.
5.5 The auditor shall, within 15 calendar days after the end of
each quarter, prepare and issue a Statement of Audit
Suspensions, Disallowances and Charges
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RULE XIII: ENFORCEMENT & MONITORING OF
DECISION (NOTICE OF FINALITY OF DECISION)… CON’T
Section 3. Non-compliance with the COE. - the Auditor shall
notify the agency head concerned of the non-compliance
and report the matter through the COA Director concerned,
to the General Counsel who shall take any or all of the
following actions:
a. Recommendation to the Commission Proper to cite
defaulting party in contempt;
b. Referral of the matter to the Solicitor General for the filing of
appropriate civil suit;
c. Referral to the Ombudsman for the filing of appropriate
administrative or criminal action.
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RULE XIII: ENFORCEMENT & MONITORING OF
DECISION (NOTICE OF FINALITY OF DECISION)… CON’T
RRSA: 6.1 The total unsettled suspensions, disallowances and
charges at the end of the calendar year as reflected in the
SASDC for the last quarter, shall be reported in the AAR of
the same year.
6.2 The AAR shall also include in it comments and
observations other deficiencies noted in the audit of
accounts as indicated in the AOM.
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ATTY. SARAH LISA C. ALQUIZALAS-ABELLA, CPA, MPA
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