Idea Transcript
No.: Dnte:
2012-003
""OCT_2.9-2012 __
cmCULARTO
All Heads of Departments. BlIfCl:\lIS, Offices. Agencies ami Jnstrulllcntolities nf the N"tiUl1t11 Cio\'el11mClll, Hctl;(h of Local Govcrnmem U11its (LGUs). M;lnaging . Hettds of. Go\'el1l111ent-Owned and/or Controlled
emPOr'I;On'S (GOCCs), eOA Assislnnl Commissioners, eOA Direclors, eOA Audilors '1Ill!All Olhers Concemed SUllJECr
Updated
Guidelines
for
the
Prevenlion
and
. Djsallownllce of (negular, Unnecc5snry. Excessive. Exll'Qvugnnl and Unconsciol1!lhle '.ExpCltdilun:s
00
Under Section 2 (2), Artiele IX-)) of Ihe 1987 Conslilntion, Ihe Comlllission Alldit (COA) shall have exclusive unthodlY, suhject 10 Ihe Iimitalion in Ihis
Article, In "xxx prolUulgule nccoul1lillg and auditing niles ilnd rcgulalions) il1c1~dil1g lhose for lhe prevention of irre.gulnr. Ulll1eCessary, excessive, exlru.vngnnt, or
unconscionable (JUEEU) expenditures or uses of govemmenl lill1ds and properties". This mllhorily was reiler.led undcr Section 3) of Presidential Decree (P.O.) No, 1~45, which :;tates:
33.
of irregulal', IlIl1leceum)', exc.essil'e, ttl' of [mills or lI.re.f oj pr(ll'el1Y; pnWi!r to cli.w/loll' such e.xpenditures. - "I1rC! Commission she,]' prumulgatc such (IIu/Wn# and accounting I'ulc.\' and r"gu/af/(m.\' as shall ;.we,'cml il'I'c:gu/"I'. ttnlleces.tOlY. excessive. or ext/'m'llgtmt e.\]Jf!utlil"res ",. II.~I!." ofgovel'l11J1(!1I1 fund .• 0" properry.
Sectioll
PfeVf!lIfinll
ex(r/U'lIgtllll eXI'f!Jltlit",.es
In line wilh these provisions and the Commission"s eff0l1s to be constnnll)' responsive 10 the changing needs of the government, Ihe lisl of silualionlli cMOS enumerated under COA Circular No, 8S-55A dlltcdScplember 8, 1985 is herellnder neSlllled with updated additional ellses eslahlished for the guidnnce of holh agency olndals and employees, lind eOA nudito~. 1.0
)'URI'OSE The Circuh.,r on IUEEU expC'nditures or uses of governmcnl r\lnd~ nnu property is updatcd to guide agency officials ill Ihe discharge or Ilte;r official
funClions lind the COA audilors in their auditorial functions. The situational cascS enumerated under COA Circular No. 85-55A dated September 8, 1985 arc elahornled by presenting actual transactions/expenditures declared as .lUEEU expenditures under various jurisprudeuce, decisions issued by this Commission, and released audit reports. Illegal expenditures are also discussed as differentiated frolll irregular expenditures and unconscionable expenditures are also included. The pertinent rules and regulations under selected types of expenditures are, likewise, enumerated for fuither guidance.
2.0
3.0
DECLARATION OF POLICIES 2.1
The COA adheres to the policy that government funds and property ~hou'd be fully protected and conserved, and that lUEEU expenditures nr tlses of such funds and property should be prevented.
2.2
The level/rank of user and mission. size, systems, structure, strategy, skills. style, and nature of operation of a government agency shall b. considered in determining whether expenditures are IUEEU. .
2.3
The list of situational eases of [UEEU expenditures or lises of govemment funds and property shall be updated from time to time in line with COA's effort to be constantly responsive to the changing needs of government..
2.4
The inte.play of certain factors, such as, but not limited to, urgency of nced, time and place of purchase, availability of needed goods and services ;nthe market, place and origin of goods, volume or quantity, service warranties, quality, special fealures and the like, and generally accepted industry practices shall be recognized in determining IUEEU expenditures.
2.5
The COA, as an independent constitutional body, is endowed with special nJle-making powers encompassing !he broad spectrum of government operations. In the exercise of such rule-making powers, the Commission can en rorce sanctions in case of violation of auditing rules and regulations which can serve as basis for administrative, civil, or criminal action as maybe warranted under existing law.
"mlillGULAR" r,;XI'ENDITURES 3.1
Definition The term "irregular expenditure" signifies an expenditure incurred wilhoul adhering to established rules, regulations, procedural guidelines, policies, principles or practices that have gained recognition in laws. Irregular expenditures are incurred if funds are disbursed without conforming with prescribed IIsages and rules of
discipline. There is no observance of ~111 established pattern, eoul-sc, nwde of uctinn, behavior, or conducl ill the inculTence of un irregblnr expcnditure. A transnction conducted in a manner that deviatd or
deparls irol11,or which does not comply with slandards set is deer)Jed inegular. A Irllnsaclion which fails to follow or violates appropriate rules of procedure is, likewise, irregular. .
4.0
3.2
Cases thai are considered "Irregulllr" Expenditures 01' Uses! of (lnverumenl Funds and Prope11yare presented in Annex "A."
3.3
Cases of violation of laws, which are considered "Illegal" expenditures of Uses of Government Funds and ]'roperty, llre il1ustrnte,t: in Anncx "B." .
"UNNECESSARY" '1.1
EXPI,NDITURES
Definition The lerm penaius to expenditures which could not pass the test of prudence or the diligence of a good father of a family, thereby , dcnoting non-responsiveness to the exigencies. of the service. Unnecessary expenditnres are those not supportive of!the implementalion of the objectives and mission of the agency relative to the nalure of its operillion. This would also include inellrrene~ of expenditlll'e not dictated by tbe demands of good governmenl, ~nd Ihose Ihe utility of which cannot be ascertained at a specific time. 'An expendilure that is nnl essential or that which can be dispensed with wilhout loss or damage 10 properly is considered unnecessary. tne mission and tlmISts of the agency incurring the expenditures musrl be cnnsidered in uelermining whelher or not an expenditure is necessarv. I
4.2
s.n
Cases lhat m'e considered "Unn~'Cessary" Expenditures or Uses I of Oovenunent Funds nnd Propel1y are presenled in Annex "c."
'''EXCI~SSrVE'' EXPENI>ITunES 5.1
Delinilion The term cxce!;sivc expenditures" signifies unl'easonable expense: or expenses incurred at an immoderate quantity and exorbitant price.: It Il
also includes expenses which exceed what is usual or proper, as well as expenses which ure unreasonably high and beyond jusl meaSlll'elor amount. They nlsn include expenses in exceSS of reasonable limits. :
5.2
Cases thaI are considered "Excessive" Expendilures of Govemment r~uil{lsare presented in Annex "D."
(j.O
"EXTRA V AGANT" EXI'ENDlTURES 6.1
DCOllitioll The IeI'm "exlmvagnnl expenditure" signilies those incllll'ed without rcstminl, judiciousness and economy. Extravagant expendilmcs cxcccd the bounds of propriety. These expcnditures nrc immoderate, .pmdignl, lavish, luxurious, grossly excessive, and injudicious.
6.2
7.0
Cases lhal are considered "Exlravagam" Expenditures of Governmcnt Funus nrc presented i~, Annex uE~'
"lINCONSCIONAlll.E" 7.1
EXI'ENDlTURr,s
Delinition The lenll ';unconseionable expenditures" pel1ains to expenditures which are unreasonablc and immoderate, and which no man in his righl sense would 1l13kc, nor a 1llil' und honest man would accept itS reasonable, and lhose incurred in violation oC ethical and moral standurds.
7.2
S.O
Expenditw'es
of
INCLUSION OF SITUATIONS DEEMED IUEEU EXPENDITURES THE UPDATED LIST
TN
8. I
enses thm are considered "Unconscionable" GOl'crnment Funds arc presented in Annex .oF:'
Nccd/Jusliiicnlion As the lists of lUEEU expendilures cannot exhaust the' simaiions which arc cleemed such, there is a need to set up a system whereby a lisl (,C disallowed expenditmes peculiar 10 an agency or a classleategory shall be made using a sell~propclling or time-adjusting mechanism such thai a case declared IUEEU expenditure in a pl1l1icular sihwliOlvseclor is, likewise, deemed IVEEU expenditure in other cases/sectors similarly silllated.
8.2
Critcria
1'01'
Inclusion of an IUEEU siluation in the Updated Lists
/\ sitnlllion may be included in the updllted list if it con'esponds positively to nllens! one onhe following criteria: there is no establishccljudicilll precedents reiati"e to the case/issue Ihere is a substantial/notable reCLIITcneeof a particular problem within II "ery limiled lime il'results in losses or non.opel'l1tion oflhe agency
1-
the case i~1\1\ nccumte illustration orthe substantive "ren urthe
IUEEU expenditure delinition 8.3
Procedlll'e Illr Inclusion In c,,~c lin rUEEU sitUlltion corresponds to any, .everdl or all of the crite..;o Sel "bove, the lallowing stcps should be observed in including the lUEEU situlltion into the Updated List: The Sopervising Auditor/Audit Tcum Leader, through the Cluster Dirce\or/As~jstant Commissioner recommends to the Commission Proper, IUEEU situations deemed ripe for inclusion in the Updoted List.
The IUEElJ situation will be taken up in a Commission Proper meeting where thc proposed inclusion will be deliberated, upon resolving omong other things, whether or not the situation will oppl)' only to the ogency c1assificotion involved or 10 the three sectors (national, local and corporate) of government. Thercotlcr, the Commission Proper shall issue a Resolution effecling the inclusion of the IUEEU situation in the Updated List. Finally, the Resolution sholl be published Rnd circularized for the int,,,,mulion of "II sectors concerned. 9,0
SlJI'RU:ME COURT DECISIONS ON IUEEU EXPENDITURES
The Supreme COUl'tupheld [his Commission's decisions to disallow in audit certain expenses for being lUEEU. Exnmples of these are as lollows: 9.1
[.lllnomrinp"id to members of (he I3ids ond Awords Committee (RAC) lind Technic,,1 Working Group (TWO) in excess of the rates provided for under Dcpartment Ilf I3udget and M"nagement (DHM) Budget Circlilor No. 2004-5A dated October 7, 2005 and for procurement activities pertaining to' contnlcts not ye( ownrded to the winning bidder (Joseph Peter Sison, el al. vs. Rogelio Tablang, er oJ., G.R. No. J 770 II daled June 5, 2009).
9.2
Grant of Christmas bonuses, cosh gilt And other fringe benefits to eonsnlhlll1Sond to members of the Board who are not salaried officials or the govel'llmcnl
as they. l.lre not cOllsider~d employees
of the hiring
"gency (COA Decision No. 2006-030 daletl April 11,2006; I3CDA vs. eOA, G.R. No. 178160 daled February 26, 2009). 9.3
Gronl "f nme!ioration allowance or ony similar benefits to private employees of service conl11lCIOrS control')' to Aliminis(rative Order No. J(ij d"ted October 10, 1997 (HDM!' "s. eOA, G.R. No. 157001 dRted October 19, 2004).
9.4
L01ieitor General or the Governmellt CO'l'orate Counsel, as the case may be'. and the. written concurrence of the COA (Phividec Industrial Authority and Ally. Cesilo Ada7..8vs. Capitol Steel Corp. and Cheng Han Sui, G.R. No. 155692 dated October 23,2003).
9.8
C Chargeable Against the Financial
CNA Incentive
(or GOCCs
Subsidy 10 l.GUs for FY 2008
DUM I.IlC No. 62 dated July 29, 19%
Guidelines on the Granl of Honoraria in Ihe
DOM BC No. 2007-3 November 29, 2007
dated
Amendments to Certnin Provisions of OC No. 2004-5A Re: Guidelines on the Grant of Honoraria Rnd Overtime Pay to Government Personnel Jnvolved in Government Procurement
DIlM BC No. 2007-2 Oelober 1. 2007
dAted
DBM NIlC No. 2007-5 10 daled May R, 2007 DIlM BC No. 2007-1 daled April 23,2007 DBM BC Nos. 2004-5 and 2004511 daled Mat~h 23, 2004 Dod
Honoraria nnd olher illlow(lIlCes
Incentive
Grnnl of CNA Incentive for NGAs, LGU.
rSI.MC Resolution No. 4,s. 200'2
(CNII)
Ihe grant of CNA
employees in govcmmcnl ogeneics
_.
"'srecmenl
LOU, .
Guidelines 00 1he Granl of Honoraria Due to Assignment in Governmenr Special Projects Guidelines on the Grlmt of Honoraria to the Govcl11ing Doards of Collegial Bodies Guidelines Oil Ihe Grant of Honoraria to Leclurers. Resource Persons. Coordinators and Facilitators
October 7, 2005, respectively
Guidelines on .he Grant of Honoraria to Government Personnel Involved in Government Procurement
11.0. No. 103 dated AuguS! 31, 2004
Directing the continued adoption of ausrerity meaSUres in the government
DBM
Updated Rules and Regulotions 011 1111:Grant of Addirional Allowtlnce Rnd Other Benefits to Nationfl' Government OffieialslEmployees Assigned to tous
Budget Execution Guidelines No. 2004-01 daled J.:I01I81')' 8, 2004
DUM Ile No. 2003-6 Seplember 29, 2003
dated
-
Guidelines relative to the grant of per diems 10 members of coJlegial bodies Dnd members of the Iloard ofRegenl!lrrustees ofSUCs
DUM BC No. 16 dilled November ~8. 1998
Grant of Amelioration GOVCl11nlent Personnel
A.D. No. 365 dated October .10. 1997
Authorizing the Granl of Amelioration Assistance to All Govemment Personnel Rnd Prohibiting: Payments of Similar Benefits in Future Years UnJess Authorized by .he President
-
ItA. No. 6758. dOled Augu't 21, 1989
r.
Grant afeNA Incentive
A.C. No. 1)5 dllted December 27, 2005
Collective Negoli:'lliotl
Aft-
SUnJEcr
Assistance
to
All
An Act Prescribing 8 Revised Compensation ond Posilion Classification System in tlle :Government and for Other Purposes
Seclion
IS of Ihe JRR of R.A. No.9184
Honoraria ofBAC and TWG Members
b
./~
m:LEVANT IlULI'.5 ANI) IlI,CULAl'IONS
AREA
COA Circuhlr No. 9R-002 dat~d June 9, 199R
01' Me No.9 Hiring
dated August 27.
1998
(If
privnle lawi'crs COA Cirelli". No,. 9S'()11 .nd 86-255 dilted Oeccn,ber 4, 1995 and April 2, 1986,
respecth'cl)'
--
~eclion 72 of No.9184
the
IRR,
R.A.
COA Cireulnr No. 2006-00 I dilled
_. Extrnordln ilcquisirioll Directing .11 government offices 10 .melly comply with A.O. No. 3, ~ 2001 prnhiblting the acquisition and use by Government offices inell1ding GOCCs, OFI" SUCs, LGU, of Il1xl1l)'
\'ehicles DUM NDe No. ~.16, s. 1995 OHM NIlC No. 446-A dated Janunr}' 3D, J .998
--
COA Circuhu No. 77-61 d.led
Seplelllhcf 26, 1977
/
Prohibiting GOCCs fro-m referring their cases and legal matters to lhe Office of the Solicitor OenernJ. private legnl counselor IRw finns Rnd directing the GOeCs 10 refer their cases find legal matters to the Office of the Government Corporate Counsel, unless othenvisc authorized under certain exceptional circllmsinllces
Amendment of Section 53 o[the IRR-A of R.A. Uoard (OPPU) Resolution No . . No. 91R4 .. Prescribing Ihe Guidelines 011 12-2007 dOled JUlie 29, 2007 Participation ofNGOs In Public Procllrement
200R
~h
Prohibitiun 3ga.inst employment by locl'l goveml1lent uni1S of privale lawyers to halldle their legal cases
GO\'CrJlmClltProcurement Policy.
A.O. No. 239 dnred Septemhtr ]5,
PUrchl15Cnod Usc of motor vehicles
SUnJI':CT
DBM I3C Nn. 2010-2 dOled.March 1.2010
Guidelines 011 lhe Dcquisition and rental or mqlor vehicles
I)rescriblng the use of the Mnnual or Audit for Consumption of Government Motor VehicJes fuel
Guidelines on lhe Acquisi.tion end Use of GovermnelU MOlor Vehlcles
~
AREA
RELEVANT RULES AND REGULATIONS
eGA CirculM
1'10,2009-001 dBred
Feblllary 12 2009 1
SUo,mcr Rest