TWENTIETH CONGRESS OF THE 
REPUBLIC OF THE PHILIPPINES 
First Regular Session
S. No.
)
SENATE 
868
> of tl'f •'*■.■7
25 AUG-4 P5 ’•52
Rb’CEIVED 8V,
Introduced by Senator Jinggoy Ejercito Estrada
AN ACT
REVISING PRESIDENTIAL DECREE NO. 1445, SERIES OF 1978, AS 
AMENDED, OTHERWISE KNOWN AS THE GOVERNMENT AUDITING CODE OF 
THE PHILIPPINES, AND FOR OTHER PURPOSES
EXPLANATORY NOTE
Auditing is an essential component in promoting good governance. It ensures 
that public funds are spent judiciously, in compliance with the law, and for the benefit 
of the people. For legislators, audit findings about government entities' financial 
mismanagement, negligence or underperformance support their oversight functions. 
Overall, state auditing is an integral part in maintaining effective and efficient 
government operations.
During the colonial era, auditing had been practiced to assess the leadership of 
outgoing administrators and to look into books of accounts, primarily to identify 
anomalies in handling public coffers. State auditing has since become a permanent 
fixture in the bureaucracy, with the Commission on Audit (COA) being tasked to be 
the supreme auditing arm of the Philippine government.
COA has the power, authority, and duty to examine, audit, and settle all 
accounts pertaining to the revenue and receipts of, and expenditures or uses of funds 
and property, owned or held in trust by, or pertaining to, the Government, or any of


its subdivisions1, including constitutional bodies, autonomous state colleges and 
universities, local government units, and non-governmental entities receiving subsidy 
or equity from or through the government.
As of December 2024, COA has 8,758 employees, mostly certified public 
accountants and employees from the career service, as its workforce is augmented by 
lawyers, engineers, and other professionals.
This measure, which was reported out by the Senate Committee on 
Constitutional Amendments and Revision of Codes during the 19th Congress, aims to 
update the 47-year-old policy - Presidential Decree No. 1445 of 1978 or the 
Government Auditing Code of the Philippines - which has guided the conduct of state 
audit in the country, and to make it more relevant with the changing times.
The proposed legislation acknowledges the evolving ways of payment, 
collection, and documentation, particularly the use of online systems and digital 
platforms, hence the introduction of terms like electronic official receipts (eOR) and 
the installation of safeguards against online banking fraud and security breach.
We are also incorporating in this bill the best practices, specifically the 
International Standards for Supreme Auditing Institutions (ISSAIs), which are 
considered as the authoritative international standards on public sector auditing, 
taking note of the good reputation and expertise of our state auditors, as well as their 
exposure and participation as external auditor of attached agencies of the United 
Nations.
Finally, the measure respects and strengthens the commission's fiscal 
autonomy, thereby ensuring that it can fully carry out its mandate with integrity, 
competence and armed with adequate resources, without fear or pressure from 
political actors.
1 Article IX (D), Section 2 (1) of the 1987 Philippine Constitution
2


In view of further reinforcing mechanisms for accountability, transparency and 
enhanced delivery of services to the Filipino people, the passage of this bill is earnestly 
recommended.
INGGOY EJERCITO ESTRADA


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TWENTIETH CONGRESS OF THE 
REPUBLIC OF THE PHILIPPINES 
First Regular Session
)
SENATE 
S. No. 868
of ti'"'
25 AUG-4 P5S2
HliClflVED 8V;
Introduced by Senator Jinggoy Ejercito Estrada
AN ACT
REVISING PRESIDENTIAL DECREE NO. 1445, SERIES OF 1978, AS 
AMENDED, OTHERWISE KNOWN AS THE GOVERNMENT AUDITING CODE OF 
THE PHILIPPINES, AND FOR OTHER PURPOSES
Be it enacted by the Senate and the House of Representatives of the Philippines in 
Congress assembled:
TITLE I
GENERAL PROVISIONS
Section 1. Title. -This Act shall be known as the" Revised Government Auditing
Act.
Sec. 2. Declaration of Policy. - It is the policy of the State to ensure efficiency, 
economy, and effectiveness in the operations of government by ensuring that 
resources of the government shall be managed or utilized in accordance with law, 
rules, regulations, and shall be safeguarded against loss or wastage from illegal or 
improper disposition. The responsibility to take care that such policy is faithfully 
adhered to rests directly with the chief or head of the government agency concerned.
Sec. 3. Definition of Terms. - As used in this Act:
a) Account retevs to a list or statement of monetary transactions pertaining to 
fund, property, obligation, equity, revenue, collection, or expense, whether 
or not entered as item/s of debit or credit in the books of accounts, registry, 
or any other record;


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b) Accountable Officer refers to the officer of any government agency or 
instrumentality who, by the nature of duties and responsibilities or 
participation in the collection or receipt and expenditure or use of 
government funds, custody, and disposal of government property, is 
required by law or regulation to render account to the Commission on Audit 
(COA). This shall include any public officer or private person or entity who 
may have participation in the transaction;
c) Advice to Debit Account (ADA) refers to an authorization issued by the 
government entity that serves as an instruction to government servicing 
banks to debit a specified amount from its available account balance for the 
payment of creditors/payees;
d) Aggrieved Party refers to a person or entity adversely affected by any 
decision, order, resolution or ruling of the Commission or any of its duly 
authorized representatives;
e) Appropriation refers to an authorization by law, appropriation ordinance, or 
other enactments, or the corporate operating budget directing the payment 
of Personnel Services (PS), Maintenance and Other Operating Expenses 
(MOOE), and Capital Outlay (CO) out of government funds under specified 
conditions and/or purposes;
f) Appeal refers to the process of elevating to a higher authority any decision, 
order, resolution or ruling of the Commission or any of its duly authorized 
representatives;
g) Audit refers to the examination, verification, evaluation and analysis of the 
accounts or financial records; the determination of the government entity's 
compliance with applicable laws, rules, and regulations; the evaluation of 
the economy, efficiency, and effectiveness of management systems, 
operations, and programs, activities, or projects (PAPs); and it may also 
cover other special audits as may be prescribed by the Commission, and the 
evaluation of the effectiveness of internal control systems for purposes of 
determining the nature, extent, and timing of the audit;
h) Auditor refers to any officer or employee of the COA duly appointed or 
designated to conduct an audit;


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i) Audit Group refers to a cluster of Audit Teams that are grouped together 
headed by a Supervising Auditor (SA). The audit group shall plan, manage, 
conduct the audit work, and ensure prompt submission of the audit report;
j) Audit Decision refers to the action of the auditor as a result of the audit to 
allow, disallow, or charge a particular transaction;
k) Audit Report refers to the final output of an audit on the accounts, financial 
records, systems, and operations of a government entity;
l) Audit Team refers to the basic organizational unit responsible for the audit 
of government and non-government entities;
m) Audit Work Papers refers to the documentation or evidence, either in 
physical or electronic form, of the work done and the results thereof, 
consisting of relevant or pertinent data, analyses, computations, 
calculations, notes, schedules, excerpts, confirmations and other documents 
or materials gathered, prepared, and compiled in the course of an audit;
n) Cash refers to money or its equivalent currencies, negotiable checks, or 
balances in bank accounts or in the possession or custody of a collecting 
and/or disbursing officer;
o) Cash Advances refer to regular or special advances granted to public officers 
and employees for a public purpose;
p) Charge refers to accountability pertaining to the assessment, appraisal, or 
collection of revenues, receipts, and other income such as those arising from 
under-appraisal, under-assessment, or under-collection or failure to collect 
or remit collection which is found in the course of audit of revenues or 
receipts;
q) COA Order of Execution (COE) refers to a written instruction to the head of 
agency to withhold payment of salary and other money due to persons 
liable, for settlement of their liability as indicated in the Notice of 
Disallowance or Notice of Charge issued after the issuance of the Notice of 
Finality of Decision (NFD);
r) Cost of Audit Services refers to the cost of discharging the audit function, 
taking into consideration the nature and complexity of operations, size of 
the government entity, and the volume of transactions being audited;


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s) Decision or Resoiution refers to an adjudication of any case or matter 
brought before any authorized official or body in the Commission which shall 
embody the facts of the case, the issue/s to be resolved, the ruling, and the 
law, regulations, or precedent on which the ruling is based;
t) Depository refers to any financial institution lawfully authorized to receive 
the deposit of government moneys;
u) Direct Eiectronic Payment (DEP) refers to an electronic payment scheme 
where the payments are made by the government entity itself, using the 
intermediary's technology or infrastructure, including the use of ADA;
v) Disaiiowance refers to the disapproval in the audit of a transaction, either 
in whole or in part, involving government disbursement or property;
w) Eiectronic Coiiection (e-Coiiection) refers to a method or manner wherein 
revenue, fees, assessments, or obligations due to the government entity are 
collected using a mechanical device, electronic device, or computer-based 
system wherein no actual money, check, or any physical note is handed 
through the hands of the government entity's collecting officer: Provided, 
That this shall include collections performed by a financial intermediary;
x) Eiectronic Payment (e-Payment) refers to the disbursement of money or 
equivalent electronic representations of legal tender, for purposes of paying 
government expenditures, solely through electronic means as opposed to 
the use of cash, check or physical notes to accomplish the same, including 
the manner by which an obligation is extinguished by means of sending 
instruction for the debit of the government entity's account and the 
corresponding credit to the payee's account, and the transfer of funds to a 
financial intermediary for the purpose of distribution;
y) Excessive Expenditures refer to unreasonable expenses that are incurred at 
an immoderate quantity and exorbitant price; exceed what is usual or 
proper, are unreasonably high and beyond just measure or amount; and/or 
are in excess of reasonable limits;
z) Extravagant Expenditures refer to expenditures that are incurred without 
restraint, judiciousness and economy; are extravagant and exceed the


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bounds of propriety; and/or immoderate, prodigal, lavish, luxurious, grossly 
excessive, and injudicious;
did)Financial Reporting Framework refers to a set of accounting principles, 
standards, interpretations, and pronouncements adopted by the 
Commission on Audit (COA) as prescribed by the international standards- 
setting body which are followed in the preparation of the financial 
statements that define how and when to recognize, measure, present and 
disclose transactions in the financial statements; 
bb)Government Agency refers to any department, bureau, or office of the 
national government, or any of its branches and instrumentalities, local 
government units (LCDs) and its political subdivision, including other entities 
it created, and government-owned or -controlled corporations (GOCC), 
including their subsidiaries;
cc) Government Funds and Properties refer to any form of public moneys and 
other resources pertaining or accruing to any agency of the government; 
including funds transferred to private entities as a subsidy, equity, donation, 
grant, or counterpart fund for implementation of PAPs;
66)Illegal Expenditures refer to expenses incurred in violation of the law; 
ee)Irreguiar Expenditures refer to expenditures that are incurred without 
adhering to established rules, regulations, procedural guidelines, policies, 
and generally-accepted principles or practices; and/or are incurred when 
funds are disbursed without conforming with prescribed usages and rules of 
discipline or incurred without observance of an established pattern, course, 
procedure, mode of action, behavior, conduct or standard; 
ff) Liability refers to either an obligation arising from audit decisions or from 
contracts or quasi-contracts;
qq)Money Claim refers to a demand for payment of a sum of money, 
reimbursement, or compensation arising from law, contract, or quasi­
contract due from a government agency or owing to a claimant; 
bb) Notice of Finality of Decision (NFD) refers to a written notification addressed 
to the head of the agency that a decision of the Commission has become 
final and executory;


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ii) Persons Liable refers to the persons determined to be answerable for an 
audit disallowance, charge, or decision by the Commission; 
jj) Persons Responsible refers to the persons determined to be answerable for 
the compliance with the audit requirements as called for in the Notice of 
Suspension (NS);
kk) Programs, Activities, Projects (PAPs) refer to any work progress or group of 
work progress undertaken to realize the outputs and outcomes of an agency 
which is represented by an item of appropriation in the national budget, 
appropriation ordinances in the case of LCDs, and corporate operating 
budgets in the case of GOCCs;
II) Public Officer refers to any person holding any public office in the 
government by virtue of an appointment, election, or contract vested with 
sovereign functions of the government; 
mm) Public Purpose refers to any purpose or use directly available to the 
general public as a matter of right, including those traditional viewed as 
essentially government functions such as the building of roads and the 
delivery of basic services, and those purposes designed to promote social 
justice and public interest as provided for by law or jurisprudence; 
wVi)Regular Cash Advances refer to those granted to cashiers, disbursing 
officers, paymasters, and/or property/supply officers for any of the following 
purposes:
1) Salaries and wages;
2) Commutable allowances;
3) Honoraria and other similar payments to officials and employees; and
4) Petty operating expenses, consisting of small payments for maintenance 
and operating expenses cannot be paid conveniently by check or are 
required to be paid immediately.
oo)Revenue refers to income or receipts derived by a government agency from 
taxes, excise, custom duties, fees, royalties, grants, rents, sale of goods or 
services, sale of assets and collections from other sources;
Settlement of Liability refers to the payment, restitution, or other act of 
extinguishing an obligation as provided by law in satisfaction of the liability


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under a Notice of Disallowance or Notice of Charge (ND/NC) or in 
compliance with the requirements of a Notice of Suspension;
qq)Settlement of Accounts refers to the process of determining the status or 
baiance of the account of an accountable officer after audit and 
examination;
rr) Settled Account refers to a transaction which after audit does not result to 
any adverse audit decision;
ss) Special Cash Advances refer to those granted on the explicit authority of the 
head of the agency only to duly designated disbursing officers or employees 
for other legally authorized purposes, as follows;
1) Current operating expenditures of the agency field office or of the 
activity of the agency undertaken in the field when it is impractical to 
pay to the same by check, such as - (a) Salaries, Wages and Allowances; 
(b) Maintenance and other operating expenses; and
2) Travel Expenditures, including transportation fare, travel allowance, 
hotel room/lodging expenses and other expenses incurred by the 
officials and employees in connection with official travel.
tt) Suspension refers to a temporary disallowance of a transaction or accounts 
which appear illegal or improper or irregular unless satisfactorily explained 
or justified by the persons responsible or until the requirements on matters 
raised in the course of audit are submitted or complied with;
uu)TrustFundsto funds which are by operation of law or by contract are 
officially in the possession of any government agency or of a public officer 
as trustee, agent, or administrator, which are for the fulfillment of certain 
obligations or a specific purpose;
w) Transfer-Distribute-Liquidate (TDL) refers to an electronic payment scheme 
where the government entity's funds are first transferred to the 
intermediary's possession and control, which the latter thereafter uses to 
distribute payments to the intended payees of the principal government 
entity;
ww) Unconscionable Expenditures refer to expenditures which are 
unreasonable and immoderate, which no fair and honest man in his right


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sense would make or accept as reasonable, and which are incurred in
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violation of ethical and moral standards; and
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xx) Unnecessary Expenditures refer to expenditures which i) does not satisfy
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the test of prudence or the diligence of a good father of a family, thereby
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denoting non-responsiveness to the exigencies of the service; ii) are not
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supportive of the objectives and mission of the agency relative to the nature
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of its operation; iii) are not dictated by the demands of good government;
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and/or iv) the utility cannot be ascertained at a specific time, are not
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essential and can be dispensed with without loss or damage to property,
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and/or contrary to the mission and thrusts of the agency incurring the
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expenditures.
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Sec. 4. Fundamental Principles. - Financial transactions and operations of any
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government agency shall be government by the fundamental principles set forth
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hereunder:
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a) No money shall be paid out of any public treasury or depository except in
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pursuance of an appropriation law, appropriation ordinance, or other
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specific statutory authority, or a Department of Budget and Management
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(DBM)-approved corporate operating budget;
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b) Government funds or property shall be spent or used solely for public
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purposes;
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c) Trust Funds shall be spent only for the specific purpose for which the trust
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was created, or the funds received;
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d) Fiscal responsibility shall, to the greatest extent, be shared by all those
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exercising authority over the financial affairs, transactions, and operations
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of the government agency;
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e) Disbursements or disposition of government funds or property shall be
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approved by the proper official of the government agency;
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f) Claims against government funds shall be properly authorized and
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supported with the complete required documentation;
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g) All laws, rules, and regulations applicable to financial transactions shall be
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faithfully adhered to; and


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h) Applicable financial reporting framework adopted by the Commission, as
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prescribed by international standards-setting body, as well as sound
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management and fiscal administration, shall be observed: Provided, That
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they do not contravene existing laws, rules, and regulations.
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TITLE II
6 
CHAPTER I
7 
ORGANIZATION
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Sec. 5. Composition of the Commission on Audit, Quaiifications, Term and
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Salary of Members. - The Commission shall be headed by a Chairperson and two (2)
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Commissioners, who shall be natural-born citizens of the Philippines and, at the time
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of their appointment, at least thirty-five (35) years of age, either certified public
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accountants with at least ten (10) years of auditing experience, or members of the
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Philippine Bar who have been engaged in the practice of law for at least ten (10)
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years, and must not have been candidates for any elective position in the elections
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immediately preceding their appointment. At no time shall all members of the
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Commission belong to the same profession.
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The Chairperson and the Commissioners shall be appointed by the President of
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the Philippines, subject to the confirmation of the Commission on Appointments, for a
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term of seven (7) years without reappointment. Appointments to any vacancy resulting
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from death, permanent disability, resignation or removal from office shall be only for
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the unexpired portion of the term of the predecessor. In no case shall any member be
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appointed or designated in a temporary or acting capacity.
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In case of vacancy pending the appointment of a Chairperson, the senior
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member, as to appointment, shall perform the functions of the Chairperson until a
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new one is appointed and assumes office.
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No member of the Commission shall, during their tenure, hold any other office
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or employment in the government. They shall neither be in the practice of any
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profession or in the active management or control of any business which in any way
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may affect their functions as members of the Commission, nor shall they be financially
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interested, directly or indirectly, in any contract with, or in any franchise or privilege
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granted by the national government, any of its political subdivisions, agencies or
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instrumentalities, including GOCCs and their subsidiaries.


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The salary of the Chairperson and the Commissioners shall be fixed by law and
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shall not be decreased during their tenure.
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Sec. 6. The Commission Proper. -The Commission Proper shall be composed
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of the Chairperson and two (2) Commissioners sitting as a collegial body in the
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discharge of the powers and functions of the Commission.
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Sec. 7. Functions of the Commission Proper. - The following shall be the
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functions of the Commission Proper:
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a) Promulgate auditing rules and regulations for the determination of the scope
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and type of audit and examination by the Commission, establish the
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techniques and methods required therefor, including those 
for the
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prevention and disallowance of illegal, irregular, unnecessary, excessive,
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extravagant, or unconscionable expenditures or uses of government funds
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or property;
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b) Promulgate accounting and auditing policies, rules, and regulations,
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including standards on internal auditing and internal control system, and
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authorize the adoption of the international accounting 
and auditing
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standards prescribed by the international standards-setting body;
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c) Promulgate its own rules concerning pleading and practices filed before the
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Commission or any of its offices: Provided, That such rules shall not
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diminish, increase, or modify substantive rights;
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d) Decide by a majority vote of all its members any case or matter brought
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before it;
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e) Appoint and promote the officials and employees of the Commission in
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accordance with the Civil Service laws, rules, and regulations;
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f) Prescribe the duties and responsibilities of the officials and employees of the
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Commission;
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g) Exercise original and concurrent jurisdiction over administrative cases filed
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against COA personnel;
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h) Recommend to Congress its retirement benefits system pursuant to its fiscal
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autonomy;
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i) Reorganize or rightsize, when necessary, the organizational structure of the
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Commission, create new positions, transfer plantilla items, or make
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adjustments in the Personnel Services Itemization in accordance with the
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organization, staffing and position classification standards and subject to
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approval of the DBM;
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j) Authorize the conduct of special audits including re-opening of settled
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accounts in case of fraud, collusion, or error of calculation or when new and
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material evidence is discovered, and other investigations as may be
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prescribed by the rules of the Commission; and
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k) Perform such other functions as may be provided by law.
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Sec. 8. Duties and Responsibilities of the Chairperson. -The Chairperson shall
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act as the presiding officer of the Commission Proper and chief executive officer of the
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Commission. As chief executive officer, the Chairperson shall:
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a) Control and supervise the general administration of the Commission;
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b) Direct and manage the implementation and execution of policies, standards,
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rules, and regulations promulgated by the Commission Proper;
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c) Sign appointments for recruitment and promotions, and office orders for
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audit engagements;
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d) Authorize the transfer, reassignment, secondment, and other forms of
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personnel movement of the officials and employees of the Commission in
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accordance with the Civil Service laws, rules, and regulations;
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e) Delegate to the Commissioners, Assistant Commissioners, Directors, and
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other officials of the Commission such authority on internal administration
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concerning personnel, planning, financial, legal, and other matters
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pertaining to their respective functional areas as may be determined by the
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Commission Proper;
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f) Submit a proposed annual or supplemental budget of the Commission to the
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DBM for approval of the Congress;
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g) Summon any person or public official for the purpose of gathering data or
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inquiring into matters pertinent to the formulation, implementation or
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enforcement of any order, decision, policy, standard, or regulation of the
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Commission Proper;
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h) Designate appropriate official as head of the Public Sector Accounting
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Standards Board and the Public Sector Auditing Standards Board;
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i) Exercise control and supervision over the audit of intelligence and/or
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confidential transactions or accounts of government agencies;
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j) Exercise control and supervision over the audit of foreign-assisted projects;
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and
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k) Perform such other functions as may be required by law, rules, regulations,
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or policies of the Commission.
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Sec. 9. Duties and Responsibilities of the Commissioners. -The following are
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the duties and responsibilities of the Commissioners:
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a) Participate in the proceedings of the Commission Proper in the discharge of
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its powers and functions; and
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b) Perform such other functions as may be provided by law, rules, regulations,
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or policies of the Commission.
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Sec. 10. Duties and Responsibilities of the Assistant Commissioners. - The
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following are the duties and responsibilities of the Assistant Commissioners:
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a) Formulate, develop, update, and supervise the implementation of the
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operational plan and performance commitment of the Sector headed which
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are aligned with the Commission's strategic plan;
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b) Supervise the general administration of offices under the jurisdiction of the
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Assistant Commissioner;
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c) Serve as a member of an Assistant Commissioners Group which shall work
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as a collegial body to study, review, and recommend policies, rules, and
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regulations for consideration by the Commission Proper or the COA
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Chairperson; and
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d) Perform such other functions as may be assigned.
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Sec. 11. The General Counsel. - The Assistant Commissioner of the Legal
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Services Sector shall be the General Counsel of the Commission.
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Sec. 12. The Central and Regional Offices. -The operations of the Commission
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under Section 16 of this Act shall be further carried out by the various offices under
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each Sector in the Central and Regional Offices. Each office in the Central and the
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Regional offices shall be headed by a Director with a rank of Director IV. All offices
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under the audit sectors shall supervise their respective audit groups and audit teams.
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The COA Regional Offices shall serve as representatives of the Commission in
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the regions and shall be under the direct control and supervision of the Assistant
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Commissioner of Local Government Audit Sector.
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Sec. 13. Duties and Responsibilities of the Commission Secretary. - The
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Commission Secretary shall have the rank of a Director IV and shall provide secretariat
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and administrative support to the Commission Proper.
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Sec. 14. Duties and Responsibilities of the Chief Executive Staff. -The Chief
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Executive Staff in the Office of the Chairperson shali have the rank of an Assistant
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Commissioner and shall be responsible for the general administration and supervision
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of the following offices:
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a) Office of the Chief Executive Staff shall monitor dissemination of the
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regulations, instructions, and directives issued by the Chairperson; monitor
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transmittal of audit reports and annual financial reports; maintain schedule,
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agenda, and make necessary arrangements for the Chairperson as
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Chairperson/Member of inter-agency committees; and ensure that the
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Chairperson is fully informed in a timely manner of all matters of importance
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in relation to the conduct of the day-to-day operations of the Commission
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to include accomplishment of targets and significant deviation from
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performance commitments and estabiished goals and objectives;
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b) Internal Audit Office shall provide independent and objective assurance and
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advisory services to obtain reasonabie assurance on the adequacy and
21 
effectiveness of governance, risk management, and control processes of the
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Commission based on its approved Strategic and Annual Audit Plan and
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establish guidelines to ensure conformance with applicable code of ethics
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and standards for internal auditing;
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c) International and Audit Relations Office shall coordinate and supervise the
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work involving the functions of the COA relating to international audit and
27 
relations, and audit of foreign-based government agencies;
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d) Internal Affairs Office shall evaluate and investigate complaints filed against
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COA personnel and recommend the filing of administrative cases or
30 
dismissal and/or termination of the complaint;
31 
e) Project Management Office shall evaluate, integrate, monitor, and act as
32 
secretariat for the priority projects of the COA and coordinate the resources
13


1 
of the Commission and liaise with the development partners in the
2 
implementation of various projects and programs;
3 
f) Public Information Office shall manage engagement with internal and
4 
external stakeholders, specifically media and the general public, to
5 
contribute to the achievement of organizational goals, and provide
6 
electronic communication needs of the Commission; and
7 
g) Quality Assurance Office shall conduct quality assurance reviews to provide
8 
reasonable assurance that the quality management system of the
9 
Commission is working effectively and in accordance with professional
10 
standards and best practices.
11 
Sec. 15. Duties and Responsibilities of the Directors. - The Directors of the
12 
Commission shall have the following duties and responsibilities:
13 
a) Formulate, develop and supervise the implementation of the annual
14 
operational plan, in accordance with the Commission's strategic plan;
15 
b) Manage the administrative operations of their office;
16 
c) Implement and execute laws, policies, standards, and rules and regulations
17 
promulgated by the Commission or the Chairperson;
18 
d) Submit annual performance report and other reports as directed by the
19 
Commission Proper or the Chairperson;
20 
e) Adjudicate on cases within their jurisdiction;
21 
f) Publish audit reports in the website of the Commission; and
22 
g) Perform other functions that may be assigned by higher and competent
23 
authority.
24 
Sec. 16. Operations of the Commission. - The operations of the Commission
25 
shall be undertaken through the following sectors which shall each be headed by an
26 
Assistant Commissioner who shall exercise supervision over various offices under it:
27 
a) Local Government Audit Sector shall be responsible for the audit of LGUs;
28 
b) National Government Audit Sector shall be responsible for the audit of NGAs;
29 
c) Corporate Government Audit Sector shall be responsible for the audit of
30 
GOCCs;
31 
d) Special Audit Services Sector shall be responsible for the conduct of
32 
performance audit, fraud audit, and special audit;
14


1
2
3
4
5
6
7
8 
9
10
11
12
13
14
15
16
17
18
19
20 
21 
22
23
24
25
26
27
28
29
30
31
32
e) Systems and Technical Audit Services Sector shall be responsible for 
technical audit and conduct of other technical-related services; and audit of 
information technology and systems and conduct of other services related 
to information and communications technology resources and services of 
government agencies;
f) Government Accountancy Sector shall be responsible for the keeping of the
general accounts of the government, preparation and submission of Annual 
Financial Reports and other financial reports, and providing technical 
assistance pertaining to accounting and financial management; 
recommendation on the adoption and implementation of accounting 
standards, 
policies, 
rules and regulations; and development,
implementation and maintenance of computerized systems and tools related 
to government accounting and financial management vital to its operation 
including systems essential for its technical oversight function over 
government accountants;
g) Legal Services Sector shall be responsible for rendering legal opinions and 
legal services; review of legal retainers and other contracts, and COA 
issuances; preparation of comments on proposed congressional bills and 
issuances of government agencies; conduct of formal hearing and drafting 
of decisions on administrative cases; enforcement of COA decisions, 
assistance in the prosecution and litigation of cases involving COA and its 
personnel acting as witnesses, including preparation of pertinent comments 
and pleadings; coordination with the Office of the Solicitor General (OSG), 
Office of the Ombudsman (0MB) and other agencies pertaining to cases 
involving COA; legal assistance to COA personnel subjected to harassment 
suits;
h) Commission Proper Adjudication Sector shall be responsible for drafting of 
decisions or resolutions for consideration of the Commission Proper;
i) Planning, Finance and Management Sector shall be responsible for the 
formulation of long-term and annual plans and programs of the 
Commission; providing budget services to the Commission; and formulation, 
recommendation, and implementation of policies on the processing of
15


1 
claims, assessment of cost of audit services, and personnel payroll
2 
management;
3 
j) Administration Sector shall be responsible for the development and
4 
maintenance of the information system of the Commission, and human
5 
resources management program; and providing general administrative
6 
services and support to the Commission; and
7 
k) Professional and Institutional Development Sector shall be responsible for
8 
the formulation, recommendation, and implementation of policies and
9 
programs on learning and development of personnel of the Commission;
10 
and providing capacity building of other government agencies' personnel
11 
pertaining to accounting and auditing matters, and other policies, rules and
12 
regulations issued by the Commission, including those concerning internal
13 
auditing and internal control systems standards.
14 
The Commission Proper may effect changes in the organization and functions
15 
of the Commission as it may deem necessary in the exercise of its fiscal autonomy in
16 
order to carry out its constitutional mandate.
17 
Sec. 17. Legal Assistance to Current and Former Officials and Employees. -
18 
Current and former COA officials and employees are authorized to engage the services
19 
of private lawyers for a fee on cases filed against them in relation to the performance
20 
of their official functions in accordance with the guidelines issued by the Commission
21 
Proper.
22 
For this purpose, the Commission shall provide a legal assistance fund to be
23 
included in its annual appropriation.
24 
Sec. 18. Professionalization of Audit Services. -The Commission shall develop,
25 
adopt, and implement a competency-based capacity building and continuing
26 
education.
27 
It shall participate and support the activities of international professional
28 
organizations such as the International Organization of Supreme Audit Institutions,
29 
Asian Organization of Supreme Audit Institutions, Association of Southeast Asian
30 
Nations (ASEAN) Supreme Audit Institutions, and other supreme audit institutions.
31 
For this purpose, the capacity building shall include courses on accounting
32 
standards, rules, and regulations relevant to auditing services.
16


1 
Sec. 19. Professionalization of Accounting and Other Services. - For accounting
2 
services, the Commission shall conduct capacity building in coordination with
3 
international professional bodies on accounting services such as the International
4 
Public Sector Accounting Standards Boards, Financial and Sustainability Reporting
5 
Standards Council, and other international professional bodies relevant to accounting
6 
services.
7 
The Commission shall likewise provide similar capacity building for other
8 
services.
9 
Sec. 20. Fiscal Autonomy. -The Commission shall enjoy fiscal autonomy and
10 
its approval annual appropriations shall be automatically and regularly released. The
11 
Chairperson of the COA is authorized to augment any item in the general
12 
appropriations for the Commission from savings in any item in the same appropriation.
13 
Sec. 21. Statement of Objectives. - In keeping with its constitutional mandate,
14 
the Commission adheres to the following objectives:
15 
a) Determine whether the fiscal responsibility which rests directly with the
16 
head of the government agency has been properly, efficiently, and
17 
effectively discharged;
18 
b) Develop and implement a comprehensive audit plan that shall encompass
19 
the examination of financial transactions, accounts, and reports, including
20 
compliance with applicable laws and regulations, as well as evaluation of
21 
the economy, efficiency 
and effectiveness 
of 
programs, activities, 
and
22 
projects;
23 
c) Institute control measures through the promulgation of auditing and
24 
accounting rules and regulations governing the revenue, receipts,
25 
disbursements, and uses of funds and properties, including audit of fund
26 
transfers to non-government organizations, people's organizations (POs), or
27 
other private entities for specific purpose;
28 
d) Promulgate accounting and auditing rules and regulations to facilitate the
29 
keeping of the accounts of the Government and enhance their information
30 
value;
31 
e) Institute measures designed to preserve and ensure the independence of
32 
the Commission, ensure transparency and accountability in government
17


1 
operations, and promote service excellence and quality in all aspects of its
2 
work; and
3 
f) Bring its operations closer to the people by the delegation of authority
4 
through decentralization and participatory governance, consistent with the
5 
provision of the Constitution.
6 
Sec. 22. GeneralJurisdiction. - Pursuant to Section 2 (1), Article IX (D) of the
7 
1987 Constitution, the Commission shall have the power, authority, and duty to
8 
examine, audit and settle all accounts pertaining to the revenues and receipts of, and
9 
expenditures or uses of funds and property, owned or held in trust by, or pertaining
10 
to the government, or any of its subdivisions, agencies, or instrumentalities, including
11 
GOCCs, and on a post-audit basis:
12 
a) Constitutional bodies, commissions and offices that have been granted fiscal
13 
autonomy under the Constitution;
14 
b) Autonomous state colleges and universities;
15 
c) Other GOCCs and their subsidiaries; and
16 
d) Such non-governmental entities receiving subsidy or equity directly or
17 
indirectly, from or through the government, which are required by law or
18 
the granting institution to submit to such audit as a condition of subsidy or
19 
equity.
20 
Provided, however. That in case where the internal control system of the
21 
audited agencies is deemed inadequate, the Commission may adopt such measures,
22 
including temporary or special pre-audit, as are necessary and appropriate to correct
23 
the deficiencies. It shall keep the general accounts of the government, and for such
24 
period as may be provided by law, preserve the vouchers and other supporting papers
25 
pertaining thereto.
26 
The Commission, under Section 2 (2), Article IX (D) of the 1987 Constitution,
27 
shall have exclusive authority subject to the limitation in Article IX of the Constitution,
28 
to define the scope of its audit and examination, establish the techniques and methods
29 
required therefor, and promulgate accounting and auditing rules and regulations
30 
including those for the prevention and disallowance of irregular, unnecessary,
31 
excessive, extravagant, or unconscionable expenditures, or uses of government funds
32 
and properties.
18


1 
Sec. 23. Examining Authority. - The Commission shall have authority to
2 
examine in the course of audit, books, papers, documents pertaining to the income of
3 
individuals and corporations in connection 
with government revenue collection
4 
operations, for the purpose of ascertaining that all revenues determined to be
5 
collectible and due the government have actually been collected.
6 
Sec. 24. LimitedJurisdiction over Private Entities. -The Commission shall have
7 
authority to examine and audit the contracts, agreements, or dealings of private
8 
entities with the government for which such private entities: i) received subsidies,
9 
counterpart funding, government equity, donation or grant, fund transfer or were
10 
allowed to use government properties or facilities; or ii) were required to pay
11 
government share such as, but not limited to, levy, franchise fees, or income share.
12 
Sec. 2 5. Deputization of Go vernment Licensed Professionals or Experts to Assist
13 
Government Auditors. - The Commission Proper may, when the exigencies of the
14 
service so require, deputize and retain, in the name of the Commission, certified public
15 
accountants and such other government licensed professionals or experts as it may
16 
deem necessary to assist its auditors in undertaking specialized audit engagements.
17 
The deputized professionals or experts shall be entitled to such compensation
18 
and allowances as may be stipulated in the contract, subject to pertinent rules and
19 
regulations on compensation and fees.
20 
The Commission Proper shall issue guidelines in contracting deputized
21 
professionals or experts referred to in this section.
22 
Sec. 26. Participation of Civii Society Organizations in the Conduct of Audit -
23 
The COA Chairperson may deputize duly accredited civil society organizations in the
24 
conduct of audit to help auditors perform ocular inspection, validation, evaluation,
25 
collection of data or information and monitoring of projects located in remote and
26 
critical areas to enhance credibility, accountability, and transparency in audit
27 
processes.
28 
Sec. 27. Prohibition of Person or Entity from Rendering, Auditing and Related
29 
Services to Government Entities. - No person or entity shall enter into a contract to
30 
render accounting or auditing related services for a fee to any government agency or
31 
conduct of seminars or workshops on topics relating to accounting, auditing and
32 
internal control system and internal auditing standards for government personnel
19


1 
without securing clearance from COA. Should the Commission decide not to undertake
2 
the study or service, it shall nonetheless have the power to review the proposed
3 
contract in order to determine the necessity, capability or expertise of the private party
4 
and the reasonableness of its fees.
5 
Any contract entered into without the approval of the Commission shall be
6 
considered null and void and the related expenditures incurred thereon shall be
7 
disallowed in audit and shall become the personal liability of the official concerned.
8 
Sec. 28. Government Contracts for the Hiring of a Private Lawyer or Law Firm
9 
to Handie Legai Cases or Render Legai Services to Government Agencies. - No
10 
contract involving public funds shall be entered into by any government agency to
11 
secure the services of a private lawyer or law firm for the purpose of representing the
12 
government agency concerned in court or for rendering legal services: Provided, That
13 
if hiring of such legal services cannot be avoided, or is justified under extraordinary or
14 
exceptional circumstances, the written conformity and acquiescence or clearance of
15 
the OSG or the Office of the Government Corporate Counsel, as the case may be, and
16 
the written concurrence of the COA shall first be secured before the engagement of
17 
private legal services: Provided, further, That in case of LGUs, only the written
18 
approval of the Commission shall be required: Provided, furthermore. That the
19 
Commission shall issue guidelines for the implementation of this provision: Provided,
20 
finaiiy. That in case of non-compliance with the above requirements and the relevant
21 
rules of the Commission, any payment thereof shall be disallowed in audit and the
22 
same shall be the personal liability of the officials concerned.
23 
The request for written concurrence shall be acted upon by the Commission
24 
within sixty (60) days from the receipt of all documents necessary to evaluate such
25 
request. The Commission shall be deemed to have approved the request for written
26 
concurrence should it fail to act thereon after the lapse of the sixty (60) day period.
27 
Sec. 29. Prohibition of Private Foundations and Entities to Use the Name and
28 
Resources of the Government to Solicit and/or Receive Donations, Grants, Financial
29 
Assistance from Private Domestic and International Donors. - Private foundations and
30 
entities organized and managed by government officials and employees are prohibited
31 
from using the name, resources, insignia, or logo of a government agency for
20


1 
whatever enterprise to solicit and/or receive donations, grants, financial assistance
2 
from the public or other donors.
3 
Any violation of the preceding paragraph shall subject the said foundation or
4 
entity to special audit by the Commission as if the funds so received are public funds
5 
which should be recognized in the books of the concerned government agency.
6 
Refusal to submit itself to such audit shall constitute an offense punishable under
7 
Section 100 of this Act.
8 
Sec. 30. Prevention and Disallowance of Illegal, Irregular, Unnecessary,
9 
Excessive, Extravagant or Unconscionable Expenditures or Uses of Government Funds
10 
or Property. - The Commission shall promulgate accounting and auditing rules and
11 
regulations for the prevention and disallowance of illegal, irregular, unnecessary,
12 
excessive, extravagant, or unconscionable expenditures or uses of government funds
13 
or property. Any violation of such rules and regulations shall be a ground for
14 
disallowance without prejudice to administrative, civil and/or criminal sanctions
15 
against the persons liable therefor.
16 
Sec. 31. Settlement of Accounts Between Agencies. - The Commission shall
17 
have the power, under such regulations as it may prescribe, to authorize and enforce
18 
the settlement of accounts subsisting between agencies of the government.
19 
Sec. 32. Collection of Indebtedness Due to the Government -The Commission,
20 
through proper channels, shall assist in the collection and enforcement of all debts
21 
and claims and the restitution of all funds or the replacement or payment to the
22 
government of any property lost or destroyed.
23 
Sec. 33. Power to Adjudicate Money Claims Against the Government - The
24 
Commission shall have the power to adjudicate money claims filed against the
25 
government or any of its subdivisions, agencies, and instrumentalities in relation to
26 
liquidated claims and quantum meruit cases. Unliquidated money claims against the
27 
government shall be filed before the proper courts, tribunals, and other adjudicative
28 
bodies.
29 
Liquidated claims refer to those determined or readily determinable from
30 
vouchers, invoices, and such other papers within reach of accounting officers.
21


1 
When the Comnnission is in the exercise of its power to execute judgments on
2 
money claims, the Commission shall, at all times, respect the principle of immutability
3 
of judgments.
4 
Sec. 34. Power to Compromise Claims. - When the interest of the Government
5 
so requires, the Commission Proper may compromise or release in whole or in part,
6 
any settled claim or liability to any government agency not exceeding Ten million
7 
pesos (Php 10,000,000.00) arising out of any matter or case pending before the
8 
Commission or falling within its jurisdiction. In case the claim or liability exceeds Ten
9 
million pesos (Php 10,000,000.00), the Commission shall submit an application for
10 
relief to Congress with its recommendations. The threshold amount subject to
11 
compromise shall be reviewed and adjusted to inflation every five (5) years.
12 
The respective governing bodies of GOCCs and self-governing boards,
13 
commissions or agencies of the government shall have the authority to condone,
14 
compromise or release any similar claim or liability when expressly authorized by their
15 
charters, subject to timely review and post-audit by the Commission: Provided,
16 
however. That if the power to condone, compromise or release claims or liabilities is
17 
not explicitly provided under the charter of the government agency concerned, the
18 
same shall be exercised exclusively by the Commission in accordance with the
19 
provision of this Act.
20 
Sec. 35. Satisfaction of Indebtedness Arising from Final and Executory Audit
21 
Decisions. - When any person or entity is indebted to any government agency by
22 
reason of a final and executory audit decision, the Commission shall direct the head
23 
of agency to withhold the salary or any money due to such entity or person liable or
24 
from the estate, in satisfaction of the indebtedness under the said decision.
25 
In case any money due to the liable entity or person is insufficient to satisfy the
26 
indebtedness from the final and executory audit decision, the Commission shall have
27 
the power to levy property or garnish bank accounts to the extent of the unpaid
28 
balance.
29 
Failure on the part of the head of agency concerned to comply with the
30 
preceding paragraphs shall render the head of agency personally liable without
31 
prejudice to the filing of administrative action for neglect of duty.
22


1 
Sec. 36. Authority to Require Submission of Documents Relative to Government
2 
Transactions. -The Commission shall have the power to require the submission of the
3 
original, in whatever form, of any order, deed, contract, or other document under
4 
which any collection of, or payment from, government funds may be made, together
5 
with any certificate, receipt, or other evidence in connection therewith. If an
6 
authenticated copy is needed for record purposes, the copy shall upon request be
7 
furnished.
8 
In the case of deeds of property purchased by any government agency, the
9 
Commission shall require a certificate of title entered in favor of the government or
10 
other evidence that would provide substantial proof that the title is in the name of the
11 
government.
12 
It shall be the duty of the officials or employees concerned, including those in
13 
non-government entities under audit, or affected in the audit of government and non-
14 
government entities, to comply promptly with these requirements.
15 
Sec. 37. Investigatory and Inquisitoriai Powers; Power to Punish for Contempt
16 
- The Chairperson and other officials and employees specially deputized in writing for
17 
the purpose by the Chairperson shall, in compliance with the requirement of due
18 
process, have the power to summon the parties to a case brought before the
19 
Commission for resolution, issue subpoena and subpoena duces tecum, administer
20 
oaths, and otherwise take testimony in any investigation or inquiry on any matter
21 
within the jurisdiction of the Commission.
22 
The Commission shall have the power to cite for contempt as provided for in
23 
the Revised Rules of Court and the Revised Rules of Procedure of the COA, under the
24 
same procedure and with the same penalties provided therein. Any violation of any
25 
final and executory decision, order or ruling of the Commission shall constitute as
26 
indirect contempt.
27 
Sec. 38. Annuai Financiai Report of the Commission. -The Commission shall
28 
submit to the President and the Congress of the Philippines not later than the last day
29 
of September of each year an annual report on the financial condition and operation
30 
of all government agencies, which shall include recommendation of measures
31 
necessary to improve economy, efficiency, and effectiveness of these agencies.
23


1 
To carry out the purposes of this Section, the Chief Accountant or the official in
2 
charge of keeping the accounts of the government agency shall submit to the
3 
Commission, year-end financial statements and such other supporting or subsidiary
4 
statements as may be required by the Commission not later than the 14th day of
5 
February of each year. Financial statements returned by the Commission for revision
6 
due to non-compliance with accounting standards, rules and regulations shall be
7 
resubmitted within five (5) working days after the date of receipt by the official
8 
concerned.
9 
Sec. 39. Annual Report on Appropriations, Allotments, Obligations and
10 
Disbursements, Including Off-Budgetary Funds and Trust Receipts. - Within one
11 
hundred twenty (120) days after the end of every fiscal year, the Commission shall
12 
submit to the President and the Congress of the Philippines an annual report on
13 
appropriations, allotments, obligations, and disbursements of NGAs and GOCCs
14 
maintaining Special Accounts in the General Fund and receiving budgetary support
15 
from the government.
16 
For the purpose stated under this Section, agencies are required to submit
17 
accountability reports to the Commission in compliance with the pertinent sections of
18 
the General Provisions of the General Appropriations Act and Republic Act No. 7226.
19 
Sec. 40. Powers, Functions, and Duties of Auditors. - The following are the
20 
powers, functions, and duties of auditors as representatives of the Commission:
21 
a) Exercise such powers and functions as may be authorized by the
22 
Commission in the examination of cash and accounts of accountable
23 
officers; conduct financial, compliance, performance, and other special
24 
audits; settle accounts of the agencies under the respective audit
25 
jurisdiction;
26 
b) Submit an audit report on the date and in the manner prescribed by the
27 
Commission and render such other reports as the Commission may require;
28 
c) For transactions subject of Audit Observation Memorandum, NS, ND, NC,
29 
complaint or a pending audit or investigation or court case, retain custody
30 
and be responsible for the safekeeping and preservation of paid expense
31 
vouchers, journal entry vouchers, stubs of checks, reports of collections and
32 
disbursements, and similar documents together with their respective
24


1 
supporting papers, until the final disposition thereof. The Commission shall
2 
prescribe the manner for preservation of these audit or legal evidence;
3 
d) Retain a digital copy of the audited vouchers and supporting papers, official
4 
receipts, and other documents or reports upon turnover or return of the
5 
originals to the auditee for safekeeping and preservation in accordance with
6 
the guidelines promulgated by the Commission Proper;
7 
e) Act as witness in proceedings before the courts, the 0MB, and other quasi-
8 
judicial bodies; and
9 
f) Perform such other functions as may be assigned to them by the
10 
Commission.
11 
Sec. 41. Examination of Cash and Accounts of Accountabie Officer. - The
12 
cashbooks, accounts, papers and cash in the accountability of an accountable officer
13 
shall be opened at all times to audit and examination of the Commission and its duly
14 
authorized representatives.
15 
In case a shortage has been discovered during an examination of the cash and
16 
accounts of an accountable officer, it shall be the duty of the auditor to immediately
17 
demand in writing the restitution of the shortage and notify in writing the head of the
18 
government agency concerned of said shortage in accordance with the regulations of
19 
the Commission. The head of the agency may immediately relieve the accountable
20 
officer and assign another officer to assume the former's duties and responsibilities. A
21 
complete report on the cash examination of the accounts of the accountable officer
22 
with cash shortage shall immediately be submitted by the auditor to the Director
23 
concerned for purposes of referral to the 0MB for investigation and filing of the
24 
appropriate administrative and/or criminal case against the accountable officer
25 
concerned, as the evidence may warrant.
26 
For the purpose of this Section, the auditor shall be regarded as a witness only
27 
in cases filed before the 0MB and the regular courts, and in no case shall the auditor
28 
be named as the complainant therein.
29 
Sec. 42. Withhoiding ofSaiaries and Other Emoiuments of Accountabie Officers.
30 
- Whenever an accountable officer has been found short of any accountability during
31 
cash examination or audit and after failure to explain satisfactorily or to produce the
32 
missing funds within the period prescribed by the rules of the Commission, the auditor
25


1 
shall order the head of the agency to direct the withholding of the salaries and other
2 
emoluments due the accountable officer concerned up to the extent of the liability
3 
until the final determination of the latter's accountability by the Commission or by final
4 
judgment of a competent court.
5 
Sec. 43. Constructive Distraint of Property of Accountabie Officer. - Upon
6 
discovery in audit of a shortage in the accounts of any accountable officer and upon
7 
a finding of a prima facie case of malversation of public funds or property against such
8 
accountable officer, the Commission may, in order to safeguard the interest of the
9 
government, place the personal property of the accountable officer concerned under
10 
constructive distraint when there is reasonable grounds to believe that the said officer
11 
intends to retire from the government service or leave the Philippines, or remove,
12 
hide, or conceal the property therefrom.
13 
The constructive distraint shall be effected by requiring the accountable officer
14 
concerned or any other person having possession or control of the property to
15 
accomplish a receipt in the form prescribed by the Commission, covering the property
16 
distrained and obligating to preserve the same intact and unaltered and not to dispose
17 
of it in any manner whatsoever without the express authority of the Commission.
18 
In case the said accountable officer or other person having the possession and
19 
control of the property sought to be placed under constructive distraint refuses or fails
20 
to accomplish the receipt herein referred to, the representative of the Commission
21 
effecting the constructive distraint shall proceed to prepare a list of such property;
22 
and in the presence of two witnesses, leave a copy thereof in the premises where the
23 
property distrained is located. Thereafter, the said property shall be deemed to have
24 
been placed under constructive distraint, in accordance with the rules and regulations
25 
of the Commission.
26 
The auditor shall submit a report to the Chairperson on any distrained effected
27 
pursuant to this Section not later than five (5) calendar days from the date of the
28 
distraint of the property.
29 
Sec. 44. Appeais from Decisions of Auditors. - Any person aggrieved by the
30 
decision of an auditor, may within one hundred eighty (180) calendar days from the
31 
receipt of a copy of the decision, appeal in writing to the Commission. The procedures
32 
of appeal shall be governed by the internal rules concerning pleadings and practices
26


1 
of the Commission, including the imposition of reasonable filing and legal research
2 
fees.
3 
Sec. 45. Period Rendering Decisions of the Commission. - The Commission
4 
Proper shall decide any case brought before the Commission within sixty (60) days
5 
from the date of its submission for decision or resolution. For the purpose of this
6 
Section, a case or matter is deemed submitted for decision or resolution upon the
7 
filing of the last pleading, brief or memorandum required by the rules of the
8 
Commission or by the Commission itself.
9 
CHAPTER II
10 
DECISION OF THE COMMISSION
11 
Sec. 46. Appeal from Decisions of the Commission. - Any decision, order, or
12 
ruling of the Commission may be brought to the Supreme Court on certiorari \N\Xh\n
13 
thirty (30) days from the receipt of a copy thereof. When the decision, order, or ruling
14 
adversely affects the interest of the government agency, the remedy may be taken by
15 
the proper head of that agency.
16 
Sec. 47. Finality of Decisions of the Commission and the Responsibility of the
17 
Head of the Agency. - A decision of the Commission upon any matter within its
18 
jurisdiction, if not appealed as herein provided, shall be final and executory.
19 
The General Counsel or any authorized official of the Commission shall issue an
20 
order of execution for final and executory decisions, resolutions, or order of the
21 
Commission.
22 
For final and executory decisions on money claims, the claimant shall initiate
23 
the process of payment with the agency concerned pursuant to existing rules and
24 
regulations.
25 
Sec. 48. Enforcement of Decisions of the Auditor or Commission Proper. -The
26 
head of agency shall ensure the immediate settlement of final and executory decisions
27 
of the Commission. Unreasonable failure or refusal of the head of the agency or
28 
concerned official to implement the final and executory decision of the Commission
29 
shall render the former administratively liable for neglect of duty.
30 
Sec. 49. Re-audit of Audited Transactions. - All transactions and accounts shall
31 
be open for audit within ten (10) years after the date of transaction except for
32 
intelligence and/or confidential transactions or accounts which may be authorized to
27


1 
be re-audited by the Chairperson. The Commission shall issue the appropriate
2 
guidelines for this purpose.
3 
TITLE III
4 
CHAPTER I
5 
BASIC POLICIES AND STANDARDS
6 
Sec. 50. Government Auditing. - Government auditing shall cover financial,
7 
compliance, and performance audits, and shall be performed in accordance with the
8 
prevailing International Standards for the Supreme Auditing Institutions (ISSAIs) for
9 
the purpose of assessing whether the financial information, transactions, programs,
10 
operations, accounts, and reports of any government agency are in accordance with
11 
the applicable international accounting framework.
12 
Sec. 51. Principies of Government Auditing. -The auditor shall be guided by
13 
the following general principles as prescribed under international standards related to
14 
the audit process:
15 
a) Comply with the relevant ethical principles of integrity, independence, and
16 
objectivity, competence, professional behavior, and confidentiality 
and
17 
transparency;
18 
b) Maintain appropriate professional behavior by applying professional
19 
skepticism, professional judgment, and due care throughout the audit;
20 
c) Perform the audit in accordance with professional standards on quality
21 
control;
22 
d) Possess collectively the knowledge, skills, expertise, ability and experience
23 
to exercise professional judgment necessary to successfully complete the
24 
audit;
25 
e) Manage the risks of providing a report that is inappropriate in the
26 
circumstances of the audit;
27 
f) Consider materiality throughout the audit process, in relation to stakeholder
28 
concerns, public interest, regulatory requirements and consequences for
29 
society;
30 
g) Prepare audit documentation that is sufficiently detailed to provide a clear
31 
understanding of the work performed, evidence obtained, and conclusions
32 
reached; and
28


1 
h) Establish effective communication throughout the audit process.
2 
CHAPTER II
3 
RECEIPTS AND DISPOSITION OF FUNDS AND PROPERTIES
4 
Sec. 52. Accounting for Moneys and Property Received by Public Officials. - All
5 
moneys and properties officiaily received by a public officer in any capacity and in
6 
connection with his or her office, must be accounted for as government funds and
7 
property, except as may be otherwise be specificaliy provided by law or competent
8 
authority. The recognition of such money and property in the books of accounts of the
9 
agency concerned shall be in accordance with pertinent laws, policies, rules and
10 
regulations, and applicable financial reporting framework.
11 
Sec. 53. Designation of Collecting or Disbursing Officers for Government
12 
Agencies. - The head of agency may designate such number of collecting and
13 
disbursing officers or agents as may be deemed necessary. They shali render reports
14 
of their collections and disbursements pursuant to the regulations of the Commission,
15 
to be submitted promptly to the auditor concerned who shall conduct the necessary
16 
examination and audit.
17 
Sec. 54. Time and Mode of Rendering Account - In the absence of specific
18 
provision of law, all accountable officers, through the agency accountants, shall render
19 
their accounts, submit their vouchers, and make deposits of money they have collected
20 
or held at such time and manner as prescribed in the rules and regulations of the
21 
Commission. The auditor concerned shail then conduct the necessary examination and
22 
audit thereof.
23 
Sec. 55. Accrual of Income or Revenues to Unappropriated Surplus of the
24 
General Fund. - All income or revenues accruing to the agencies by virtue of the
25 
provisions of laws, order and regulations shall be deposited in the National Treasury
26 
or in any duiy authorized government depository and shall accrue to the
27 
unappropriated surplus of the General Fund of the government, unless otherwise
28 
provided by law.
29 
Income or revenues from business-type activities and revolving funds of
30 
government agencies may be separately recorded and disbursed in accordance with
31 
such rules and regulations as may be determined by the Permanent Committee
29


1 
created by law, composed of the Secretary of Finance as Chairperson, Secretary of
2 
Budget and Management, and Chairperson of the Commission, as members.
3 
Sec. 56. Special, Fiduciary and Trust Funds. - Receipts shall only be recorded
4 
as income of Special, Fiduciary or Trust Funds or Funds other than General Fund when
5 
the same is duly authorized by law and performed in accordance with the rules and
6 
regulations issued by the Permanent Committee.
7 
Revenues collected from particular taxes, levy, and royalties for special purpose
8 
shall be treated as a special fund or Special Account in the General Fund and shall be
9 
paid out only for such purpose: Provided, That the Permanent Committee may
10 
recommend for approval of the President the reversion and closure of the Special
11 
Account in the General Fund, Fiduciary or Trust Funds on any of the following grounds:
12 
a) The purpose for which a special fund was created has been fulfilled,
13 
terminated or abandoned;
14 
b) The terms have expired or no longer necessary for the attainment of the
15 
purpose for which said funds were established;
16 
c) The account remained dormant for unreasonable length of time;
17 
d) The funds in the account are needed by the Government in times of
18 
emergency; or
19 
e) The funds in the account are being used in violation of the rules and
20 
regulations issued by the Permanent Committee.
21 
Sec. 57. Receipts and Revenues of Local Government Units. - All receipts and
22 
income accruing to the LGUs shall be deposited in their account maintained in the
23 
authorized government depository bank or private bank with the prior approval of the
24 
Department of Finance (DOF).
25 
Sec. 58. Receipts and Revenues of GOCCs. - All receipts and income accruing
26 
to GOCCs shall be deposited in their account maintained in the authorized government
27 
depository bank, unless otherwise specifically provided by law or agreements.
28 
Sec. 59. Collections by the Government. - No payment of any nature shall be
29 
received by a collecting officer without immediately issuing an official receipt in
30 
acknowledgment thereof. The receipt may be in the form of postage, internal revenue
31 
or documentary stamps or such other digital forms as the law or the Commission may
30


1 
authorize: Provided, That in no instance shall temporary or provisional receipts be
2 
issued to acknowledge the receipt of public funds.
3 
Where digital or electronic devices are used to acknowledge cash receipt, an
4 
electronic official receipt (eOR) shall be issued and the electronic copies of the pieces
5 
of evidence of the e-collection through Self-Collect and Credit or Collect-Aggregate-
6 
Remit or other modes of electronic coilection allowed by the rules of the COA. Such e-
7 
ORS shall be kept in electronic archives, and shall be subject to inspection and
8 
verification by the Commission, in accordance with its prescribed guidelines on the use
9 
of eORs to acknowledge collection of income and other receipts of government.
10 
The eORs shall be acceptable provided the document maintains its integrity and
11 
reliability and can be authenticated so as to be usable for subsequent reference:
12 
Provided, That the electronic document has remained complete and unaltered, apart
13 
from the addition of any endorsement and any authorized change, or any change
14 
which arises in the normal course of communication, storage and display; and that
15 
the electronic document is reliable for the purpose for which it was generated and for
16 
all relevant circumstances.
17 
Collections in the form of checks in favor of the government shall be governed
18 
by the rules of the Commission.
19 
In no instance shall money in the hands of the collecting officer be utilized for
20 
whatever purpose but should be deposited intact with an authorized government
21 
depository bank.
22 
Sec. 60. Payment in Settiement - Electronic payment through TDL, credit card,
23 
Direct Electronic Payment (DEP) such as Advice to Debit Account (ADA) and other
24 
modes may be used to settle all obligations of the government in accordance with the
25 
guidelines of the Commission and other Public Financial Management agencies of the
26 
government.
27 
Electronic payment to a person not duly authorized to receive such payment
28 
shall subject the accountable officer concerned to administrative/civil sanctions or
29 
criminal prosecution, as may be warranted.
30 
In instances when checks are drawn against the checking account of the
31 
government agencies maintained with any government depository in payment of an
32 
obligation:
31


1 
a) The check shall be made payable directly to the creditor to whom the money
2 
is due, or to the disbursing officer or employee for an official disbursement;
3 
b) Checks drawn in payment of any indebtedness shall likewise be accepted by
4 
the officer concerned, provided it shall be made payable to the entity or the
5 
authorized official of the payee; and
6 
c) When a check drawn in favor of the government is not accepted by the
7 
drawee bank for any reason, the drawer shall continue to be liable for the
8 
sum due and all penalties resulting from delayed payment. Where the
9 
reasons for non-acceptance by the drawee bank are insufficiency of funds
10 
and/or closed accounts, the drawer shall be criminally liable therefor.
11 
Sec. 61. Deposit of Money in the Treasury or Authorized Government
12 
Depository Bank. - Public officers authorized to receive and collect moneys arising
13 
from taxes, revenues or receipts of any kind shall remit or deposit the full amount
14 
received and collected to the account of the National Treasury or in the agencies
15 
account maintained in the authorized government depository bank not later than the
16 
following banking day, except when it is impractical to do so due to distance or when
17 
the amount to be deposited is minimal.
18 
Fifty percent (50%) share on proceeds from the community tax certificates
19 
collected by duly deputized barangay treasurers shall be automatically retained and
20 
deposited intact in the authorized depository banks of the barangay where the tax is
21 
collected pursuant to the Republic Act No. 7160, as amended, otherwise known as the
22 
"Local Government Code of 1991."
23 
No collections shall be used for the purpose of disbursements except when
24 
authorized by law or regulation.
25 
Sec. 62. Acknowiedgment of Receipt of Money by Government Depositories. -
26 
All authorized government depository banks shall acknowledge receipt of all money
27 
received for the account of the National Treasurer or the agency concerned. The
28 
acknowledgment shall bear the date of actual deposit and indicate from whom and on
29 
what account it was received. Such moneys received shall be governed by the
30 
Treasury Single Account System established pursuant to law.
31 
Sec. 63. Access to Bank Statements for Audit Purposes. - The authorized
32 
agency official shall regularly furnish the monthly bank statements of the agency to
32


1 
the auditor. In the event that the agency fails or refuses to comply with this
2 
requirement, the auditor shall be authorized to directly request such bank statements
3 
from the government depository bank concerned. In such case, the bank shall
4 
promptly provide the requested statements, and shall waive any pertinent bank fee
5 
that may be imposed on such request.
6 
Sec 64. Shipment of Government Money or Property by a Carrier; Notation of
7 
Evidence of Loss. - When government money or property is transported from one
8 
place to another by a carrier, it shall be the duty of the consignee or duly authorized
9 
representative to make notation or notations on the bill of lading or receipt on any
10 
evidence of loss, shortage, or damage.
11 
Sec. 65. Credit for Loss Occurring in Transit or Due to Fire, Theft, Robbery or
12 
Force Majeure. - When loss of government funds, property, documents evidencing
13 
financial transactions, or records of accountabilities occurs while they are in transit or
14 
loss is caused by fire, theft, robbery or force majeure, the officer or employee
15 
accountable therefor or having custody thereof shall immediately notify the auditor
16 
concerned and, within thirty (30) days from the occurrence of loss, shall file an
17 
application for relief, together with the required supporting 
evidence. When
18 
warranted, credit for the loss shall be allowed. An officer or employee who fails or
19 
refuses to comply with this requirement shall not be relieved of liability or allowed
20 
credit for any loss thereof. The procedures on application for relief shall be governed
21 
by the rules and regulations of the Commission.
22 
Sec. 66. Disposai of Government Property. - When property of the government
23 
becomes unserviceable or is no longer needed, it may be disposed of in the following
24 
manner, adhering to the guidelines issued by the Commission:
25 
a) Transfer of property between government agencies;
26 
b) Destruction or sale of unserviceable property;
27 
c) Sale through public auction of unserviceable property;
28 
d) Sale through public auction of government property that is no longer
29 
needed; and
30 
e) Other modes as may thereafter be approved and prescribed in the
31 
guidelines issued by the Commission, or by the joint guidelines issued by
32 
the Commission and the DBM.
33


1 
Sec. 67. Disposal of Rea! Property. -The disposal of real property through sale
2 
shall require prior approval of the Commission: Provided, however, That government
3 
agencies specifically authorized by law or rules to dispose real properties without need
4 
of prior approval of the Commission may proceed with such disposal.
5 
Sec. 68. Disposal of Goods and Properties Seized or Confiscated by Law
6 
Enforcement Agencies. -The destruction or disposal of goods and properties seized
7 
or confiscated by law enforcement agencies and presented as evidence in cases before
8 
the courts shall be carried out by such agencies in accordance with their respective
9 
rules and regulations.
10 
Sec. 69. Funds or Property Held by Deceased, Incapacitated or Absconding
11 
Accountable Officer. - When an officer accountable for government funds or property
12 
dies, becomes incapacitated, or absconds in the performance of duties, the head of
13 
the agency shall designate a custodian to take charge of the funds or property until
14 
the appointment of a qualified successor. The head of the agency may appoint a
15 
committee to conduct an inventory of the cash and property for which the officer was
16 
accountable and to determine the responsibility for any shortage therein. A duly
17 
certified copy of the inventory and the report of the committee shall be filed with the
18 
auditor concerned: Provided, That the findings of the committee shall not be
19 
conclusive until the completion of an audit thereon. The head of the agency, whenever
20 
necessary, shall be responsible for filing appropriate case and securing thereof a hold
21 
departure order from the court to prevent the absconding officer from leaving the
22 
country.
23 
If the deceased, incapacitated, or absconding officer is accountable for funds
24 
or property of an LGU, the acting custodian and committee shall be designated by the
25 
local chief executive, furnishing notice to the Secretary of Finance or the authorized
26 
appointing official as prescribed under the Local Government Code.
27 
Sec. 70. Disposal of Foreclosed Assets or Collaterals Acquired in the Regular
28 
Course of Business by GOCCs. - Notwithstanding their respective charters, foreclosed
29 
assets or collaterals acquired in the regular course of business by GOCCs shall be sold
30 
through public bidding following the appraisal thereof by an independent appraiser.
31 
Such sale shall be under the supervision of the proper committee on award or similar
34


1 
body by the GOCC. Notice of such sale shall be published for not less than two (2)
2 
consecutive days in any national newspaper of general circulation.
3 
In the event that the public bidding fails, the property may be sold at a
4 
negotiated sale at such price as may be fixed by the same committee subject to the
5 
immediate audit of the auditor concerned in accordance with the regulations of the
6 
Commission. If the property remains unsold for at least one (1) year, this will be
7 
subject to reappraisal and offered again for sale through public bidding.
8 
Government property may be disposed of as payment of dividend, after
9 
appraisal thereof by an independent appraiser and review by the Commission, subject
10 
to the approval of the DOF.
11 
Sec. 71. Final Report of Accountable Officers. - An accountable officer, shall
12 
after one month upon ceasing to act in official capacity, shall submit to the auditor of
13 
the agency concerned a report of accountability. Upon receipt of the report, the
14 
auditor shall conduct a cash examination on the accountability of such accountable
15 
officer.
16 
Any remaining balance on cash accountability shall be deposited immediately
17 
in the treasury.
18 
Sec. 72. Notice of Disallowances, Charges and Suspensions Issued by the
19 
Auditor to Accountable Officer. - Whenever there is a finding of pecuniary loss or
20 
damage on the part of the government, the auditor concerned shall issue a written
21 
notice of suspension, disallowance or charge through the head of the agency to each
22 
accountable officer, whose accounts have been audited in whole or in part.
23 
Within ninety (90) days after the receipt of the notice of audit suspension,
24 
failure to submit satisfactory explanation, justification, or evidence to settle or disprove
25 
the initial findings of an auditor with regard to irregularity or illegality of the covered
26 
transaction shall render the audit suspension into disallowance.
27 
Any person aggrieved by the decision of the auditor pertaining to disallowances
28 
or charges may appeal the case in accordance with the rules and regulations on
29 
settlement of accounts of the Commission.
30 
TITLE IV
31 
CHAPTER I
32 
GOVERNMENT ACCOUNTING
35


1 
Sec. 73. Appropriation Before Entering into a Contract. - No contract involving
2 
the expenditure of public funds shall be entered into unless there is an appropriation
3 
or approved budget therefor, the unexpended balance of which, free of other
4 
obligations, shall be sufficient to cover the proposed expenditure.
5 
Sec. 74. Certificate Showing Appropriation to Meet Contract. - Except in the
6 
case of a contract for personnel services or for supplies for immediate consumption,
7 
no contract involving the expenditure of public funds by any government agency shall
8 
be entered into or authorized without a certification issued by the proper budget officer
9 
of the agency concerned that funds have been duly appropriated for the purpose and
10 
that the amount necessary to cover the proposed contract for the fiscal year is
11 
available for expenditure on account thereof. The certificate signed by the proper
12 
budget officer shall be attached to and become an integral part of the contract, and
13 
the sum so certified shall not thereafter be available for expenditure for any other
14 
purpose until the obligation of the government agency concerned under the contract
15 
is fully extinguished.
16 
The funding guidelines of the DBM shall be followed for multi-year contracts.
17 
Sec. 75. Void Contract and Liabiiity of Officer. - Any contract entered into
18 
without satisfying the requirements provided under this Act shall be void ab initio and
19 
shall not be binding to the government. The officer of any government agency
20 
responsible for the said contract shall be personally liable to the government or other
21 
contracting party as if the transaction had been entered into between private parties.
22 
Sec. 76. Prohibition Against Advance Payment on Government Contracts. -
23 
Except when authorized by law or its implementing rules and regulations, the
24 
government shall not be obliged to make an advance payment on contracts for:
25 
a) Services not yet rendered;
26 
b) Supplies and materials not yet delivered, inspected, and accepted, except
27 
in lease of venues and catering services as provided for in the procurement
28 
law and its implementing rules and regulations; and
29 
c) Infrastructure projects not yet implemented or satisfactorily completed,
30 
inspected, and accepted, other than for mobilization as provided for in the
31 
procurement law and its implementing rules and regulations.
36


1 
Sec. 77. Limitations on Cash Advance. -The following shall be the limitations
2 
on cash advance:
3 
a) No cash advance shall be given unless for a legally authorized specific
4 
purpose;
5 
b) Cash advances shall be reported on and liquidated as soon as the purpose
6 
for which it was given has been served;
7 
c) No additional cash advance shall be granted or allowed unless the previous
8 
cash advance has been settled/liquidated, or after the conduct of a proper
9 
accounting thereof;
10 
d) Except for cash advance for official travel, no officer or employee shall be
11 
granted cash advance unless such officer or employee is properly bonded in
12 
accordance with existing laws or regulations. The amount of cash advance
13 
which may be granted shall not exceed the maximum cash accountability
14 
covered by bond of an officer or employee;
15 
e) Only permanent appointed officials shall be designated as disbursing
16 
officers;
17 
f) Only duly appointed or designated disbursing officers may perform
18 
disbursing functions. Officers and employees who are given cash advances
19 
for official travel need not be designated as disbursing officers;
20 
g) Transfer of cash advance from one accountable officer to another shall not
21 
be allowed;
22 
h) The cash advance shall be used solely for specific legal purpose for which it
23 
was granted, and under no circumstance shall it be used for encashment of
24 
checks or for liquidation of a previous cash advance;
25 
i) The failure of the concerned official or employee to liquidate the cash
26 
advance after due demand by an authorized officer is a prima facie
27 
presumption of malversation despite the absence of a finding of actual
28 
damage to the government;
29 
j) The transfer of cash advance by a disbursing officer to another does not
30 
constitute an expenditure for which the disbursing officer may claim credit
31 
in accounts, but the responsibility of such disbursing officer continues to
32 
attach until the amount has been fully accounted for; or
37


1 
k) No cash advance shall be granted for the procurement or implementation
2 
of infrastructure projects.
3 
Any violation of foregoing provisions shall constitute a valid cause for the
4 
withholding of the salary of the accountable officer without prejudice to the imposition
5 
of administrative/civil sanctions and criminal prosecution of both the authorizing and
6 
the accountable officials, as may be warranted.
7 
Sec. 78. Transfer of Funds Between Public Officers. -Transfer of government
8 
funds from one officer to another shall, except as allowed by law or regulation, be
9 
made only upon prior direction or authorization of the head of the agency following
10 
the accountability and accounting guidelines issued by the Commission.
11 
Sec. 79. Limitations on Fund Transfers Between Government Agencies and
12 
Instrumentalities. - The following shall be the limitations on transfer of funds from
13 
one government agency to another:
14 
a) No fund transfers shall be given except for legally authorized specific
15 
purpose as embodied in a Memorandum of Agreement (MOA) executed
16 
between the source and implementing agencies;
17 
b) The fund transfers shall be reported on and/or liquidated by the
18 
implementing agencies as soon as the purpose for which they have been
19 
granted has been served, but not later than the end of the year;
20 
c) No additional or new fund transfers shall be made unless the previous
21 
transfers have been fully liquidated as certified by the head of agency
22 
concerned;
23 
d) The heads of the source and implementing agencies shall be responsible for
24 
compliance with the foregoing requirements.
25 
Failure on the part of the foregoing officials/persons to comply with the
26 
abovementioned responsibilities shall constitute a ground for administrative, civil, or
27 
criminal action, as evidence may warrant.
28 
Sec. 80. Limitations on Fund Transfers from Any Government Agency to a
29 
Private Organization or Entity. -The following shall be the limitations on transfer of
30 
funds from any government agency to any private organization or entity:
31 
a) No fund transfer from a government agency shall be given to a private
32 
organization or entity unless authorized by law for a specific purpose which
38


1 
should be embodied in a MOA executed between the source government
2 
agency and the implementing private organization or entity;
3 
b) Only duly registered, accredited, and reputable private organizations or
4 
entities shall be granted fund transfers;
5 
c) Fund transfers shall be reported on and liquidated by the implementing
6 
private organizations or entities to the source government agency as soon
7 
as the project has been completed or not later than sixty (60) days after
8 
project completion. If the project implementation will go beyond December
9 
31st of the year, a partial liquidation report as of December 31st of that year
10 
shall be submitted to the source government agency not later than January
11 
15 of the ensuing year;
12 
d) No additional or new fund transfers shall be made unless the previous fund
13 
transfers have been fully liquidated as certified by the head of the agency;
14 
or
15 
e) The heads of the source government agency and implementing private
16 
organizations or entities shall be responsible for compliance 
with the
17 
foregoing requirements.
18 
Failure on the part of any public officer, employee, or any person to comply
19 
with the abovementioned responsibility shall constitute a ground for administrative or
20 
civil action or criminal prosecution.
21 
Sec. 81. Payment of Rewards. - When a reward becomes payable by authority
22 
of law for information given relative to any offense or any illegal activity, or for any
23 
act done in connection with the apprehension of the offender, the reward shall be paid
24 
as prescribed by law or regulations. Such payment of reward shall be subject to audit
25 
in accordance with the regulations of the Commission.
26 
Sec. 82. Loss Through Electronic Collection or Payment -Government agencies
27 
utilizing e-Collection and/or payment systems shall formulate internal policy guidelines
28 
to implement reasonable and appropriate organizational, technical, and personnel
29 
controls to prevent loss of funds caused by internet connectivity issues, errors in
30 
payment instructions, online banking fraud, security breach, or other similar events.
31 
Any loss due to the foregoing shall be the liability of the erring party.
39


1 
Sec. 83. Replacement of Lost, Stolen or Destroyed Checks. - When payment is
2 
made through check and the same was lost, stolen, or destroyed, the issuing officer
3 
may issue a replacement check as payment for the same obligation. Replacement shall
4 
be made upon the execution of an affidavit of loss and submission of stop payment
5 
order to the drawee bank. If destroyed, presentation of the destroyed check to the
6 
issuing officer is also required. The chief accountant of the agency shall be responsible
7 
for seeing to it that no double payment is made as a result thereof.
8 
Sec. 84. Reversion of Unpaid Trade Payables Aged More Than Two (2) Years.
9 
- The head of NGAs, LGUs, and GOCCs classified as non-commercial public sector
10 
entities shall cause the reversion of trade payables aged more than two (2) years to
11 
the Unappropriated Surplus or Accumulated Surplus/(Deficit).
12 
The head of GOCCs classified as commercial public sector entity shall revert
13 
any unpaid trade payables aged more than two (2) years to retained earnings.
14 
In both instances, the reversion shall only be made when there is no actual
15 
claim or is not supported by a valid contract.
16 
CHAPTER II
17 
ACCOUNTABILITY AND RESPONSIBILITY FOR GOVERNMENT FUNDS AND
18 
PROPERTY
19 
Sec. 85. Accountable Officers; Bond Requirement - Every officer of any
20 
government agency whose duties permit or require the possession or custody of
21 
government funds or property shall be accountable therefor and for the safekeeping
22 
thereof in conformity with iaw. Other government officers who, though not
23 
accountable by the nature of their duties, may likewise be similarly held accountable
24 
for government funds or property through their participation in the use or application
25 
thereof.
26 
Every accountable officer shall be properly bonded in accordance with law and
27 
the pertinent rules or regulations.
28 
Sec. 86. Primary Responsibility and Fiscal Accountability of the Head of the
29 
Agency. - The head of the agency who is primarily responsible for all government
30 
funds and property pertaining to the agency, shall ensure that:
40


1 
a) The required financial and other reports and statements are submitted by
2 
the concerned agency officials in such form and within the period prescribed
3 
by the Commission;
4 
b) The settlement of disallowances and charges is made within the prescribed
5 
period;
6 
c) The requirements of transactions suspended in audit are complied with; and
7 
d) Appropriate actions are taken on the deficiencies noted in the course of
8 
audit.
9 
Persons entrusted with the possession or custody of the funds or property
10 
under the head of the agency shall be accountable thereof and immediately
11 
responsible to the head of the agency, without prejudice to the liability of either party
12 
to the government.
13 
Sec. 87. General Liability for Unlawful Expenditures. - Expenditures of
14 
government funds or uses of government property in violation of law or regulations
15 
shall be the personal liability of the official or employee found to be directly responsible
16 
therefor.
17 
Sec. 88. Degree of Supervision over Accountable Officers. - The head of any
18 
government agency shall exercise due diligence in supervising accountable officers
19 
under the control of such head of the agency to prevent the incurrence of loss of
20 
government funds or property, otherwise the head of the agency shall be jointly and
21 
solidarily liable with the person primarily accountable therefor.
22 
The treasurer of the LGU shall likewise exercise the same degree of supervision
23 
over accountable officers under the oversight of the treasurer, otherwise the treasurer
24 
shall be jointly and solidarily liable with them for the loss of government funds or
25 
property under their stewardship.
26 
Sec. 89. Measure of Liability of Accountable Officers. - Every officer
27 
accountable for government property shall be liable for its money value in case of
28 
improper or unauthorized use or misapplication thereof by such accountable officer or
29 
by any person whose acts such accountable officer may be responsible for.
30 
Accountable officer shall likewise be liable for all losses, damages, or deterioration
31 
occasioned by negligence in the keeping or use of the property regardless of whether
32 
or not it is in the actual custody of such accountable officer.
41


1 
Every accountable officer for government funds shall be liable for all losses
2 
resulting from the unlawful deposit, use, or application thereof and for all losses
3 
attributable to negligence in the keeping of the funds.
4 
Sec. 90. Liability for Acts Done by Direction of Superior Officer. - No
5 
accountable officer shall be relieved from liability by reason of acting under the
6 
direction of a superior office in paying out, applying, or disposing of the funds or
7 
property for which such accountable officer is accountable, unless prior to such act,
8 
the accountable officer notified the superior officer in writing that the expenditure is
9 
illegal, irregular, excessive, extravagant, unnecessary, and unconscionable. The officer
10 
directing any illegal payment or disposition of the funds or property and the
11 
accountable officer who fails to serve the required notice shall be jointly and solidarily
12 
liable.
13 
Sec. 91. Prohibition Against Pecuniary Interest - No head of agency, members
14 
of the board or commission, accountable officer or public official shall have direct or
15 
indirect pecuniary interest in any contract or transaction of the agency when such
16 
public officer is appointed, or in any office where the public officer has influence.
17 
This prohibition shall likewise apply to the accountable officer's immediate
18 
family and relatives up to the third civil degree of consanguinity or affinity.
19 
TITLE V
20 
CHAPTER I
21 
BASIC PRINCIPLES
22 
Sec. 92. Government Accounting. - Government accounting shall encompass
23 
the processes of analyzing, recording, classifying, summarizing, and communicating
24 
all transactions involving the receipt and disposition of government funds and property
25 
in accordance with the applicable international accounting framework, International
26 
Public Sector Accounting Standards or Philippine Financial Reporting Standards, as the
27 
case may be, and interpreting the results thereof.
28 
Sec. 93. Recognition of Financial Transactions. - Each government agency shall
29 
recognize its financial transactions and operations in accordance with pertinent laws,
30 
policies, rules, and regulations, and applicable financial reporting framework.
42


1 
Sec. 94. Accounting Policies, Rules and Regulations. - The Commission shall
2 
promulgate accounting policies, rules and regulations in accordance with the
3 
applicable international accounting framework, which shall be updated from time to
4 
time as the Commission may deem proper.
5 
CHAPTER II
6 
ACCOUNTING REPORTS
7 
Sec. 95. Financial Reports and Statements. - The financial reports prepared by
8 
the agencies shall comply with the applicable financial reporting framework to the
9 
government agency.
10 
The financial statements shall be based on official accounting records and
11 
registries kept in accordance with pertinent laws, policies, rules and regulations of the
12 
Commission, and the applicable financial reporting framework to the government
13 
agency.
14 
Sec. 96. Submission of Reports. - The Commission shall require the head of
15 
agencies, chief accountants, budget officers, cashiers, disbursing/collecting officers,
16 
administrative or personnel officers, and other responsible officials of the various
17 
agencies to submit financial statements, financial accountability reports, physical
18 
inventory reports, current staffing pattern, and such other reports as may be
19 
necessary for the exercise of its functions.
20 
In case of failure or refusal on the part of the officials concerned to submit the
21 
documents and reports mentioned herein within the prescribed period, the head of
22 
the agency shall cause the suspension of the payment of their salaries until they
23 
complied with the requirements of the Commission, without prejudice to any
24 
disciplinary action that may be instituted against such official or employee in
25 
accordance with the applicable rules on administrative cases issued by the Civil Service
26 
Commission.
27 
Failure or refusal on the part of the head of the government agency to
28 
implement, without justifiable case, the sanctions provided in the immediately
29 
preceding paragraph shall constitute as a ground for the Commission to file the
30 
appropriate administrative charge against the erring official concerned.
31 
CHAPTER III
32 
INTERNAL CONTROLS
43


1 
Sec. 97. Internal Control System. - Internal control shall comprise the integral
2 
process effected by those charged with governance, agencies' management and
3 
personnel designed to provide reasonable assurance regarding the achievement of
4 
objectives relating to operations, compiiance, reporting and safeguarding of assets.
5 
It shali be the direct responsibility of the agency head to install, implement,
6 
and monitor a sound system of internal control.
7 
TITLE VI
8 
FINAL PROVISIONS
9 
Sec. 98. Duty to Respect the Independence of the Commission. - It shall be
10 
the duty of every person to respect, protect, and preserve the independence of the
11 
Commission.
12 
Sec. 99. Administrative Disciplinary Action. - Any unjustified failure or refusal
13 
by the public officer concerned to comply with any requirement imposed in this Act
14 
shall constitute neglect of duty or grave misconduct, as the case may be, and shall be
15 
a ground for the Commission to file appropriate administrative disciplinary action
16 
against the said public officer who, upon being found guilty thereof after hearing, shall
17 
be meted out such penalty commensurate with the degree of guilt in accordance with
18 
the civil service law, without prejudice to criminal prosecution whenever the evidence
19 
warrants.
20 
The auditor shall report any violation of the preceding paragraph to the Director
21 
of the Commission concerned for referrai of the case to the 0MB, or other government
22 
disciplining authorities.
23 
Sec. 100. Pena!Provisions. - Any person who shall commit any of the following
24 
acts shall, upon conviction, suffer imprisonment of not less than six (6) years and one
25 
(1) to twelve (12) years or a fine of not less than One hundred thousand pesos (Php
26 
100,000.00) but not more than One million two hundred thousand pesos (Php
27 
1,200,000.00), or both at the discretion of the court:
28 
a) Refusing or neglecting to render or settle an account as required by law or
29 
regulation after demand by the Commission or its authorized
30 
representatives;
31 
b) Denying access to databases or information technology systems, or failing
32 
to produce documents, records, or papers under custody within fifteen (15)
44


1 
days after demand by the Commission or its authorized representatives in
2 
connection with the conduct of audit;
3 
c) Destroying or concealing documents, records, or papers which are officially
4 
entrusted to such person, pertaining to the collection, receipt, expenditure,
5 
or disbursement of public funds and utilization or disposal of government
6 
property in connection with the conduct of audit;
7 
d) Failing or refusing to submit documents required in audit without justifiable
8 
cause shall constitute a ground for disallowance of the claim under
9 
examination, assessment of additional levy or government share, or
10 
withholding or withdrawal of government funding or donations through the
11 
government, as well as for administrative or penal sanctions; or
12 
e) Committing other similar acts that impede, frustrate or delay the efficient
13 
conduct of audit.
14 
If a violation of this Act constitutes an offense or crime punished under Act No.
15 
3815, otherwise known as the Revised Penal Code, as amended, or other special laws
16 
which impose a higher penalty, the latter shall prevail.
17 
If the offender is a corporation, partnership or association or other juridical
18 
entity, the penalty may, in the discretion of the court, be imposed upon such juridical
19 
entity and upon the officer or officers of the corporation, partnership, association, or
20 
entity responsible for the violation.
21 
Sec. 101. Implementing Rules and Regulations. -The Commission Proper shall
22 
promulgate the necessary rules and regulations for the effective implementation of
23 
this Act.
24 
Sec. 102. Appropriations. -The amount necessary for the implementation of
25 
this Act shall be included in the annual GAA.
26 
The COA is hereby authorized to collect the following:
27 
a) One-half (1/2) of one percent (1%) from the annual national tax collections
28 
not otherwise accruing to special funds or special accounts in the general
29 
fund of the national government, upon authority from the Secretary of
30 
Finance, shall be deducted from such collections and shall be remitted to
31 
the National Treasury to cover the cost of auditing services rendered to
32 
LG Us;
45


1 
b) A fixed amount equivalent to the annual cost of the audit services in the
2 
GOCCs; and
3 
c) From other sources such as, but not limited to, collections of audit fees from
4 
water districts and special audits, consultancy fees and retained income.
5 
All GOCCs, including their subsidiaries, and self-governing boards shall
6 
appropriate in their respective budgets and remit not later than the end of the second
7 
quarter of each year an amount equivalent to the appropriation for personnel services
8 
of the audit team to the National Treasury.
9 
The amount for the MOOE and capital outlay to support the annual or the actual
10 
audit operations of the audit teams assigned to NGAs, LGUs, and GOCCs which form
11 
part of the approved budget of the audited agency for auditing services under the
12 
GAA, appropriations ordinances or annual operating budget, respectively, shall be
13 
remitted directly to the COA Central Office.
14 
All internally generated income of the Commission from other sources shall
15 
accrue to its retained income fund to be exclusively utilized for the operation and
16 
performance of its mandate.
17 
Sec. 103. Franking Privilege. - All official mail matters and telegrams of the
18 
COA addressed for delivery within the Philippines shall be received, transmitted, and
19 
delivered free of charge: Provided, That mail matters addressed to private persons or
20 
non-government offices shall not exceed one hundred twenty (120) grams.
21 
Sec. 104. Repealing Clause. - Presidential Decree No. 1445, otherwise known
22 
as the Government Auditing Code of the Philippines; Subtitle B, Title I, Book V of
23 
Executive Order No. 292 or the Administrative Code of 1987; and all other laws,
24 
executive orders, proclamations, decrees, instructions, rules and regulations, or parts
25 
thereof which are inconsistent or in conflict with any provision of this Act shall be
26 
deemed amended, repealed, or modified accordingly.
27 
Sec. 105. Separability Clause. - If for any reason, any provision of this Act is
28 
declared unconstitutional or invalid, such parts not affected thereby shall remain in
29 
full force and effect.
30 
Sec. 106. Effectivity. - This Act shall take effect fifteen (15) days following
31 
completion of its publication in the Official Gazette or in any newspaper of general
32 
circulation.
46