CoA raps DA for not settling P7.5B in disallowances, suspension, charges

The Commission on Audit (CoA) has admonished the Department of Agriculture (DA) over its failure to settle disallowances, suspensions, and charges, which stood at P7.4 billion as of the year-end of 2023.

According to the auditing body, the unsettled audit suspensions, disallowances, and charges incurred by the DA from January to December 2023 totaled P7,357,230,827.54.

The breakdown of the unsettled amount showed that the DA had P6.1 billion under the notice of suspension (NS) and P1.2 billion under the notice of disallowance (ND).

The CoA issues NS for "transactions of doubtful legality/propriety/regularity" that may lead to pecuniary loss for the government, and which will be disallowed if the agency concerned fails to validly justify the spending. It must be settled within three months from receipt.

Meanwhile, an ND is issued by state auditors for "irregular/unnecessary/excessive and extravagant" transactions, as well as those considered illegal and unconscionable. Persons liable for the disallowance have six months from receipt to settle it.

Based on the audit report, 19 offices of the DA are liable for the P6.1 billion worth of NS, with the DA Central Office accounting for the largest amount of P4.8 billion.

The NS was issued due to irregular monetization of leave credits, incomplete documents on payment for procured composting facilities, hazard allowance, and subsistence and laundry allowance, among others.

The P1.2 billion under the ND, meanwhile, resulted from various irregularities in the DA's fund utilization, such as overpayment of daily subsistence allowance and travel expenses, irregular payment of salaries to contract service personnel to offset overtime credits (which was found to have no basis), as well as payments for sports and medical allowances without legal basis, among others.

The amount represented 20 agencies under the DA.

State auditors lamented the accumulation of the unsettled P7.4 billion balance by the year-end of 2023, despite the due dates set forth by the 2009 Rules and Regulations on Settlement of Accounts (RRSA), which merely showed the DA's "leniency or laxity" in enforcing its rules and regulations on the settlement of suspensions, disallowances, and charges.

"The unsettled disallowances deprived the government of the productive use of the unrefunded amounts," the CoA said.

DA's Agricultural Training Institute, meanwhile, told auditors that the concerned employees have continuously paid their disallowances, which are deducted from their monthly salary, mostly from the bonuses/benefits they are receiving. They also committed to pay their remaining disallowances until 2027 and beyond.

CoA, however, countered that 52 liable persons have either separated from the agency, transferred, or been reassigned to other offices but still have unsettled disallowances totaling P8.7 million as of the year-end of 2023, indicating low compliance with payment obligations.