Auditors find Makati fund irregularities

By BEN R. ROSARIO
July 19, 2009

A Commission on Audit report on Makati City’s finances has indicated serious fund irregularities committed by city officials, including the grant of P200 million in cash advances as a means of evading regular public biddings for various city projects.

The CoA report assailed the administration of Mayor Jejomar Binay for failing to justify the cash advances as it pointed out irregularities committed in the disbursement of the funds.

An outspoken critic of graft and corruption allegedly instigated by Malacañang, Binay was asked to stop the practice of granting cash advances for purchases that ordinarily should pass “public biddings or other modes of procurement” as provided under the law.

State auditors disclosed that advances granted by the city government ranged from P100 to P1 million.

They stressed that a total amount of P200,635,959 distributed to city personnel remained unliquidated, while disbursing officers who have been entrusted such huge amounts have track records of failing to justify their expenses in the past.

The amount of unjustified cash advance could be the biggest among Metro Manila localities, the CoA said.

In its 2008 audit of Makati City’s finances, CoA also criticized the granting of honoraria to officials and employees for doing tasks that can be performed by regular personnel of certain departments.

Director Roland A. Rey of the CoA National Capital Region-local government sector revealed that the city government granted a total P200,635,959.90 in cash advances to “officials and employees who were not duly appointed or designated as disbursing officers” as of December, 2008.

These city hall employees failed to liquidate the cash advances by submitting receipts and other acceptable evidences of expenditures.

Rey said the city government also violated an audit directive that prohibits the grant of cash advances for regular purchases.

“These were used for regular purchases thereby disregarding the requirement on public bidding and/or other modes of procurement as per Republic Act 9184,” the official said.

The CoA team noted that an analysis of the transactions have indicated that the cash advances were used to purchase materials for the repair and maintenance of buildings, equipment, and motor vehicles, maintenance and improvement of roads and other land improvement.

Such expenditures do not “warrant the granting of cash advances in material amounts because they are not time bound nor emergency in nature,” the government finance inspectors stressed.

“It was further noted that the personnel were granted additional cash advances although the previous advances were not yet liquidated in violation of CoA circular 97-0002,” the CoA report said.

Auditors warned that considering that large amounts of cash advances were distributed to city employees, there is a possibility that not all were spent for the purpose they were intended for. The unspent money should be returned immediately, they added.

“This practice could expose the advances still on hand to possible misuse or misappropriations,” the CoA stated.

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Accountable officers concerned should be made answerable to the these irregularities!