Philippines
National
COA demands liquidation of P2 B given by PH Sports Commission to 30th SE Asian Games organizers
COA demands liquidation of P2 B given by PH Sports Commission to 30th SE Asian Games organizers
Over P2 billion in financial assistance granted by the Philippine Sports Commission (PSC) for the country’s hosting of the 30th Southeast Asian Games last year is in danger of being disallowed by the Commission on Audit (COA) for the failure of organizers to liquidate the expenditures.
(MANILA BULLETIN FILE PHOTO)
“The Audit Team already issued NS (notice of suspension) Nos. 2020-02 and 2020-03 for the unliquidated FA of PHISGOC and POC, respectively,” COA said in the recently-released 2019 annual audit report for the PSC.
A NS may ripen into a Notice of Disallowance unless the concerned state agency is able to comply with COA’s demand to justify the expenditures with the submission of receipts, delivery invoices and other proofs of expenses on a designated period of time.
PHISGOC and POC refer to the Philippine SEA Games Organizational Committee Foundation Inc. and the Philippine Olympic Committee, respectively. Both received financial assistance from PSC for the holding of the highly-successful SEA Games last year.
“FAs released to PHISGOC and POC in CY 2019 in the total amount of P1,815,169,762.67, P535,413,045.56, respectively pertinent to SEA Games events remained unliquidated as of year-end despite completion of the intended purpose, contrary to COA Circular No. 2007-001,” COA said.
The audit report added: “Moreover, the PSC granted additional FAs to PHISGOC from January 29, 2020 to June 19, 2020 in the total amount of P417,546,728.08 despite non-liquidation of previous FAs, thus, further increasing the unliquidated accounts of PHISGOC to P2,232,716,490.76.”
The audit team assigned by COA disclosed that a check with the subsidiary records of the released FA’s indicated that not a centavo has been liquidated as of the time audit was conducted. This, despite the demand letters sent by both COA and the audit team.
Responding to the demand letter on June 25, the PHISGOC noted that there was an agreement among PSC, POC and PHISGOC that final fund utilization report will be submitted after the remaining financial support from the PSC is received by the latter.
COA said the POC has not yet replied to the demand letter it sent.
“The Audit Team does not agree with PHISGOC’s contention since each FA has particular purpose and noted that the purposes of the FAs that were granted in CY 2019 had already been served/completed. Hence, it is expected that related expenses were already paid/settled by both PHISGOC and POC,” COA stated.
The state audit agency said it finds no reason why PHISGOC must delay the liquidation of the FAs because “the same are intended for other purposes.”
According to COA, the PSC released to PHISGOC a total P417,546,728 from January 29 June 19, 2020 “despite non-liquidation of previous FAs, thus, further increasing the unliquidated accounts of PHISGOC.”
COA directed the PSC to require both POC and PHISGOC to immediately submit their respective liquidation reports with supporting documents. Final fund utilization reports have also been demanded by auditors.
The same audit report noted that the PSC disbursed P24,636,309.08 to cover PHISGOC expenditures in 2018, or earlier than the release by the Office of the President of Memorandum Circular No. 56.
COA said the disbursement made by PSC to support PHISGOC activities in 2018 is “without basis” since the presidential order directing all government agencies to extend support to PHISGOC was released only on January 25, 2019.
Commenting on the audit observation, the PSC headed by its chairman William Ramirez explained that funding advances were made to “avoid international embarrassment” because funding for the organizational requirements of the hosting of the games “were not established as early as possible.”
The PSC also assured auditors that its action “is always guided by the Office of the President” which asked agencies to extend all assistance necessary in accordance with their mandate.
PHISGOC, on the other hand, pointed out that it was organized even before MC56 was issued by President Duterte.
“Necessarily, preliminary expenses were already incurred prior to the issuance of MC56 in January 2019 and prior to the enactment of the 30th SEA Games Budget in the 2019 GAA (General Appropriations Act),” PHISGOC officials explained.