A NEWS MEDIA site reported Tuesday, July 12, that Lapu-Lapu City Mayor Junard "Ahong" Chan "clarified" that the Commission on Audit (COA) has "already cleared" the city for giving risk and hazard daily pay (AHDP) for non-health workers.
Cleared? Not yet.
In the full report of COA's findings on Lapu-Lapu City's spending in 2021, it said Lapu-Lapu City "has yet to submit documents required to prove" that the persons who claimed the questioned allowances "were entitled to the benefits." Although he cited a Department of Budget and Management memo allowing exceptions to the rule, Mayor Chan didn't cite the support to his claim about the City having been cleared. Instead, he hinted he might take legal action against the reporter.
LGU COMMENT, COA REJOINDER. Under the review procedure, the audited LGU or government agency comments on each COA finding and recommendation. But often, the process doesn't stop there. COA makes a rejoinder. The rejoinder on risk and hazard pay tends to shoot down Chan's claim, unless COA gave him the clearance after releasing the report.
On the comment-rejoinder process, COA also corrected the claim of Lapu-Lapu City on the purchase of P218.45 million of equipment, furniture, office supplies, groceries and other goods from Heritage Muebles Mirabile Export Inc., which the audit says may be "just a middleman" and "may not be qualified to transact business," thus preventing the procurement "at prices most advantageous" to the City.
The public can see that COA doesn't just let the LGU or agency say its piece. COA answers back, usually with fact-checking, as it did in its rejoinder to the city's defense of the assailed purchase.
CLAIMS, FINDINGS. On that Heritage Muebles transaction, Lapu-Lapu City claimed having observed bidding procedures and implementing rules and examined the documents provided by the supplier. The City assured that it conducted "due diligence" and "ocular inspection" and determined the firm was qualified.
COA's report says its audit team found that Heritage Muebles's income tax return for 2020 shows Heritage Muebles's main business is "manufacture and repair of furniture and fixtures of metal" (underscored in the report) and its BIR form (#2303) lists the following: "a. manufacture and repair of furniture and fixtures of metal, b. buying, selling, renting, leasing, operation of dwelling, c. real estate buying, developing, subdividing, selling."
Inventories account showed these accounts: "1. raw materials inventory, work in process inventory, and finished goods inventory, work in process inventory, and finished goods inventory." Heritage Muebles's 2021 business permit however -- "despite all the documents showing that the payee is in manufacturing business," COA says -- shows that the firm was operating as "a. general merchandise-essential; b. general merchandise - non-essential; c. repair services; shellcraft exporter."
Which, the COA report says, should've prompted the city's bids and awards committee to disqualify the firm as a bidder.
The audit team also found the goods displayed were "in a few racks, too few to cater to the general public." A company employee, the COA report says, also admitted they were not open for retail to the public.
NOT ENOUGH. Apparently, the so-called full report may not be enough for the reason that it's not yet complete. Findings, if disputed, still have to be resolved; and the LGU's claims verified. In the Lapu-Lapu City 2021 financial report, for example, it's not yet certain (a) if the City has been cleared on the questioned risk and hazard benefits given to some suspected unqualified persons and (b) whether it was dealing with a qualified supplier on more than P200 million purchases from "just a middleman."
Media reporting stops soon after the newsbreak, which is as true with a COA report as with most other stories.
The public is not told about what happens next to COA recommendations and whether a promise breached by the audited agency is sanctioned. The next story is the filing of charges or declaration of suspensions or disallowances. Or long media silence until the next audit season. People wouldn't know whether any public official is punished or any of the pilfered or lost government money is recovered.