🚨Supreme Court upheld COA’s decision to disallow certain Philhealth benefits

In 2007 to 2008, Philhealth granted its officials and employees certain benefits that according to the Commission on Audit (COA), and upheld by the Supreme Court, is disallowable. 

Among these disallowed benefits were the following:

• Efficiency gifts;
• Birthday gifts;
• Special events;
• Nominal gifts;
• Education assistance; 
• Project completion benefit;
• Payment of liability insurance premium;
• Corporate transition and achievement premium; and
• Medical mission critical allowance. 

These benefits were disallowed as there was no prior approval from the Office of the President before payment of the same – in violation of Memorandum Order No. 20 of June 2001, and Administrative Order No. 103 of August 31, 2004.

The aforementioned Memorandum Order suspended the grant of any salary increases and new or increased benefits such as, but not limited to, allowances; incentives; reimbursement of expenses; intelligence, confidential or discretionary funds; extraordinary expenses, and such other benefits not in accordance with those granted under Salary Standardization Law (SSL). Said suspension covers senior officer level positions, including Members of the Board of Directors or Trustees.

Further, the Order states that any increase in salary or compensation of GOCCs/GFIs that are not in accordance with the SSL shall be subject to the approval of the President.

Philhealth tried to appeal saying that these benefits were granted in good faith; however, the Supreme Court was not convinced and instead reiterated COA’s decision that granting these benefits requires prior approval from the President. The law has long been existing; hence, the high Court did not allow Philhealth to claim ignorance on the same.

Source: SC affirms COA disallowance of P204-M PhilHealth benefits by Rappler.com | February 9, 2021

COA disallowed P8 Million worth of ‘fictitious trip’ by election officials

The Commission on Audit (COA) affirmed the disallowance of P8.265 million worth of travel expenses made by Commission on Election (COMELEC) officials in 2008 and 2009.

The subject COMELEC officials appealed that the the documents related to the travel expenses were forged and that they did not have any participation in the consummation of the fraudulent transactions.

However, COA said that the determination whether the documents were forged or not is beyond its jurisdiction as its function is limited to the prevention and disallowance of irregular, extravagant or unconscionable use of government funds.

The subject traveling expenses were incurred in connection to the continuing voters registration for the 2010 election.

“While the transactions were consummated through forgery, this did not erase the fact that fraudulent transactions happened within the COMELEC. This showed weak internal control system that led to the illegal disbursement of public funds,” COA said in its decision.

The COA decision noted that the travels were “fictitious and fraudulent” due to overlapping period of travel, duplication or double payment and even instances of triple claim of travelling expenses. 

The travel expenses ranged from P39,000 to P182,600 with a total of 54 claims. 

Source: ABS-CBN News

COA questions ‘redundant’ consultants in Ilocos Norte

The Commission on Audit (COA) flags the “unnecessary and redundant” hiring of consultants made by the Ilocos Norte government in 2020 on contractual basis and were paid on a monthly compensation ranging from P30,000 to P154,164.40.

The COA questioned the expenditures inasmuch as the consultants’ “obligations and functions do not equate with their actual work accomplishments or outputs.”

“Their functions were not highly technical in nature and their outputs can be provided by regular employees of the province,” said the Commission on Audit.

Said consultants were hired to assist the province in dealing with the pandemic. Among those hired include special education consultant, a structural engineer, an architect, a management services manager, and a COVID-19 (coronavirus disease) coordinator for the office of the governor.

In defense, the provincial government said that the works of said personnel are “highly technical” contrary to the audit body’s observation.

Nonetheless, the province would be reviewing the contracts of the other consultants and would recommend creating regular positions for the services now held by consultants but are deemed “necessary to the operation of the provincial government.”

Source: Inquirer.net

6 LGUs flagged over COVID-19 spending

In a news by Philstar Global, six (6) local government units (LGUs) from the provinces of Pampanga, Zambales and Mountain Province were flagged by the Commission on Audit over COVID-19 spending.

Among the observations by COA on the COVID-19 spending of these LGUs are the following: 

• Some beneficiaries denied receiving cash assistance from the LGU despite their name appearing in the list of beneficiaries;
• Some beneficiaries admitted receiving cash assistance even if their work or income were not affected during the implementation of community quarantine. On the other hand, some admitted that they do not belong to the poor households or the informal sector who were not able to work due to community quarantine;
• Some beneficiaries admitted that they received cash assistance despite not actually interviewed by the social welfare department of the LGU;
• Some beneficiaries also admitted that they are recipients of the Pantawid Pamilyang Pilipino Program or 4Ps while others were already receiving assistance from national government agencies; hence, may mean duplication of benefits;
• Payment of hazard pay that lacks supporting documents as to exposure to hazards;
• Failure to observe procurement requirements; and
• Failure to show proof of receipt of cash and in-kind assistance. 

We at GABOTAF are documenting these audit findings (tagged as COAble) so as to help our colleagues take note of them and hopefully avoid them in their respective Offices. 

Source: Philstar Global

No documents showing that the recipients of cash donations were eligible

The Commission on Audit (COA) questioned the distribution of cash donations by the Provincial Government of Davao Oriental as there were no documents showing that recipients were eligible. 

COA said that upon evaluation of the disbursement vouchers and the supporting documents of several cash donations, there were no documents showing that the recipients were eligible or residents of the province (i.e., no certificate of eligibility) or that the donations went through proper evaluation.

Out of the total donated cash, P15.1 million went to alleged financial assistance, including travel allowance of government employees and incidental expenses.

Several individuals and groups received cash grants from the LGU more than once and “within a short span of time”. 

These cash donations should have had documentary evidence, including case summary and certificate of eligibility, that the Provincial Social Welfare Development Office would evaluate.

The LGU acknowledged the deficiencies and it assured COA that it would establish a rigorous information system that will include data of recipients.

Source: Rappler | COA questions Davao Oriental’s P37-million cash donations

[You May Like to Read: List of Common COA Audit Findings on Cash Advances]

Loss of Income due to Non-compliance with the required documentary requirements and applicable rules and regulations

The Commission on Audit (COA) has called the attention of the Department of Health (DOH) because PhilHealth rejected the reimbursement of claims of various public hospitals due to “the Hospitals’ inability to address the recurring challenges and non-compliance with applicable regulations, claims for reimbursement” which resulted to loss of income in the aggregate amount of ₱111.150 million. 

Said income “could have been used to augment their operating requirements”, COA said. 

Among the public hospitals which were denied of claims are the following:

1. Dr. Jose N. Rodriguez Memorial Hospital (DJNRMH) — P63.14 million;

2. Cagayan Valley Medical Center — P7.534 million;

3. Mayor Hilarion A. Ramiro Sr. Medical Center —P6.403 million;

4. San Lorenzo Ruiz Women’s Hospital — P5.772 million; and

5. Culion Sanitarium — P5.241 million.

What COA Recommends

• DOH and the management of the hospitals to straighten out their policies and thoroughly review documents before being submitted to PhilHealth in order to improve its reimbursement rate.
• PhilHealth to talk with DOH officials to avoid the common recurrence of such incidents.

Source: Inquirer.net | COA tells DOH to fix system as it notes PhilHealth denial of P111.1 million in claims

Submitted Liquidation Report Lacks the Required Supporting Documents

Section 4(6) of Presidential Decree 1445 states the fundamental principles that include among others, that claim against government funds shall be supported with complete documentation.

Poor Implementation of Government Projects Due To Failure to Conduct Detailed Engineering Investigations, Surveys and Designs Prior to Bidding and Award of Contract

COA points out that under Section 17.6 of the Revised Implementing Rules and Regulations (RIRR) of Republic Act 9184 or the Government Procurement Reform Act, “no bidding and award of contract for infrastructure projects shall be made unless the detailed engineering investigations, surveys and designs, for the project have been sufficiently carried out and duly approved in accordance with the standards and specifications prescribed by the Head of Procuring Entity (HoPE) concerned.

COA says that if the activities required under Section 17.6 of the Revised IRR of RA 9184 had been properly carried out, delayed project implementation can be avoided.

COA recommends instituting necessary remedies that would fast-track the implementation of the projects such as imposition of liquidated damages against the contractors for the late deliveries or completion of projects as well as disqualificationand blacklisting of erring contractors.

Source: https://www.google.com.ph/…/coa-cites-afp-delayed-mode…/amp/

Job Order workers performing jobs of regular government employees

The Commission on Audit (COA) questioned the hiring of Job Order (JO) workers by the local government of Hilongos as more than half of the said workers perform clerical and administrative functions that were supposed to be handled by regular employees. 

COA said that the local government hired 285 job order employees (JOs) or 244% more than its 117 regulars – which cost it P17.04 million. 

Aside from said observation, COA also found discrepancy between the number of hiredpersonnel and the actual people reporting to work. Specifically, only 12 out of the 63 alleged JO hiresfor the Mayor’s office reported to work. 

On the other hand, only 4 out of the 42 listed JO employees reported under the Office of the Municipal Engineer, while 31 out of the supposed 46 worked for the municipality’s environment and sanitary office.

The LGU clarifies, however, that the “office assignment of job order personnel as stated in their contracts is only to identify which office the JO salary will be charged and not necessarily their actual office assignment.”

The LGU agreed to fill in vacant regular positions instead of hiring more JOs and to reassess its hiring guidelines, as provided for in the Local Government Code, as reiterated by COA. 

Source: Rappler | COA flags irregularities in Leyte town’s hiring of job order employees

Excessive Hiring of Job Order and Contract of Service Workers

The municipal government of Carigara in Leyte province was ordered by the Commission on Audit (COA) to end the excessive hiring of contractual and job order (JO) employees as it had led to overspending. 

LGU Carigara had appropriated P18.93 million to cover the wages of its JO/Contract of Service workers; however, it spent P8.79 million “more than the amount appropriated for wages of contractual/JO personnel.”

COA also found that the accomplishment reports of the JO/COS workers of the LGU showed “exact duplicated copies of the accomplishment report of other JO workers except for the name and signature”, aside from these workers do not have detailed personal records on file.

COA says in its report that the accomplishment reports of the JO workers were duplicated several times in which only the names and period covered were indicated or changed. 

The LGU claims, however, that the “limitation as to hiring of JO is the discretion of the local chief executive.”

COAble:

• Excessive hiring of Contract of Service (COS) and Job Order (JO) workers;
• Overspending: spending more than the appropriated amount;
• Duplication of tasks;
• No detailed personnel records on file.

Source: Rappler | COA orders Leyte town to stop excessive hiring of contractual workers