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FOURTEENTH CONGRESS OF THE 
1 
REPUBLIC OF THE PHILIPPINES 
) 
Second Regular Session 
) 
c 
S E N A 'ff E 
Senate Bill No. 
Introduced by Senator Manny Villar 
EXPLANATORY NOTE 
The challenge of good governance has never been more urgent during these times 
when massive corruplioii in the government remains unresolved. While the fight against 
corruption involves all of'us, auditors play a significant part in anti-corruption efforts by 
ensuring that financial reports follow the generally accepted guidelines and are accurate. 
Auditors are instrumental in protecting and preventing intentional behavior and actions 
that undermine the will of the people, waste of public funds and resources and discourage 
accountability and transparency. They have to demonstrate that they are honest and 
prudent stewards of their respective institutions. 
The sensitive nature of the work of slate auditors makes them vulnerable to 
outside lbrces that challenge their principles. If not well-compensated, they are likely lo 
commit fraud or indiscretions to accommodate the requests of unscrupulous and self- 
serving individuals in exchange for a sum of money. 
One way to protect our auditors against this system is by providing them with 
monetary incentives equal to the worth of their specialized profession, which this bill 
seeks to promote. More importantly, it gives them a greater sense of self, knowing that 
the government liilly recognizes the value of their work. 
Accurate auditing reports lend credibility and foster public trust, which create an 
overall high level of auditing standards. We can only do this if we rally behind our 
auditors and give what is due them. 
In view ofthe above, the passage of this bill is earnestly sought 


8 ;~;.:j3 .”~!, 
FOURTEENTH CONCJIUSS OF THE REPUBLIC 
Second Regular Session 
OF THE PHILIPPINES 
Introduced by Senator Villa1 
AN ACT 
GRANTING ADDITJONAL COMPENSATION IN TPE FORM OF SPECIAL 
ALLOWANCE 
FOR 
THE 
OFFICERS 
AND 
EMPLOYEES 
OF 
THE 
COMMISSION ON AUDIT (COA) AND FOR OTHER PURPOSES 
Be it enacted by the Senate and the House of Representatives of the Philippines in 
Congress assembled: 
Section 1. Statement of Policy. - The function of the Commission on Av#t 
(COA) which embraces all matters relating to auditing procedures, systems and controls, 
the maintenance of the general accounts of the government, the preservation and 
safekeeping of transaction vouchers relative to government endeavors, the examination 
dhd inspection of the hooks of accounts, records and relevant documents, the audit and 
skttlement of funds and properties of all accountable officers, for purposes of 
hfeguarding the government’s coffers from wastage, is hereby affirmed and recognized. 
Section 2. COA’s Independence. - The effectiveness of the discharge by COA 
of its delicate and awesome responsibilities is inextricably linked to the degree of 
independence it enjoys. To he able to preserve its independence, the COA needs to he 
insulated from any control and unwarranted influences. As vibrant partner in nation 
building, the COA needs to he free from any partisan influence and political pressure so 
that it can institute and enforce fiscal control within the overall framework of public 
fiscal administration towards the realization of government goals and objectives. 
Section 3. Fiscal Autonomy. - The General Appropriations Act authorized 
independent constitutional commissions and offices enjoying fiscal autonomy, such as 
COA, to fix and determine the salaries, allowances, and other benefits of their personnel 
within the limits of their respective appropriations, notwithstanding any provision of law 
to the contrary. 
Section 4. Grant of Special Allowance. ~ Pursuant to the declared policy of this 
Act and in order to maintain the COA’s independence, there is a need to keep a roster of 
efficient, dedicated and globally competitive State Auditors, by providing them with 
incentives commensurate to their positions and intricate functions. 
Additionally, to give more meaning and recognition to the sensitive and peculiar 
nature of the functions of the COA as praetorian of the national treasury and in 


acknowledging its fiscal autonomy, all officials and employees of the COA shall be 
granted special allowances in amounts to be determined by the Secretary of the 
Department of Budget and Management (DBM) and the Chairman of the Commission. 
The grant of the said special allowance shall not exceed one hundred percent 
(100%) of the basic salary proportionate to the salary grades of the officials and 
employees concerned as provided in Republic Act No. 6758, otherwise known as the 
Salary Standardization Law, as amended. 
Section 5. 
Appropriations. - The amount necessary for the initial 
implementation of this Act shall be charged against the current fiscal year’s 
appropriations under the budget of the Commission. Thereafter, such sums as may be 
necessary for the continued implementation of this Act shall be included in the annual 
General Appropriations Act. 
Section 6. Additional Funding Source. - The additional funding sources of the 
amount necessary to implement the additional compensation in the form of special 
allowances granted under this Act shall be as follows: 
1. From savings generated by the COA in its operations; 
2. From fees collected by COA in performing: 
a. audit and related services to government-owned and controlled 
corporations (GOCCs) and local government units (LGUs); 
b. services rendered to private entities audited in connection with their 
dealings with the government arising from subsidies, counterpart funding 
by the government, or where audited records become the basis for 
government levy and share; and 
c. audit and related services arising from contracts with government entities 
and international organizations; 
3 .  From income sourced through the imposition of filing fees on cases filed 
before the COA in the exercise of its quasi-judicial function. 
4.. Collection through imposition of fines on administrative cases. 
5. From income collected through the use of COA facilities such as dormitories, 
gym and training centers. 
6. From income sourced through the conduct of seminars and lectures. 
The amounts collected pursuant to this section shall constitute and shall be deposited as a 
Special Trust Fund which shall be administered by the Chairman of the Commission to 
carry out the provisions of this Act. 
Section 7. Effects of Subsequent Salary Increases. - In the event that 
subsequent increases in the salary rates provided under Republic Act No. 6758, as 
amended, is implemented and/or increases of salary rates is granted by the President of 
the Philippines, all special allowances granted under this Act to the officials and 
employees of the COA shall be considered as an implementation of the said salary 
increases as may be provided by law. The special allowance equivalent to the increase in 


the basic salary as may be provided by law shall be converted as part of the basic salary: 
Provided, That the amounts converted as basic salary shall be funded from the regular 
appropriations of the COA. Any excess in the special allowances granted under this Act 
not converted as basic salary shall continue to be granted as such and shall continue to be 
funded under Sections 5 and 6 of this Act. 
Section 8. Implementing Rules and Regulations. - The COA shall issue the 
necessary rules and regulations for the effective implementation of this Act not later than 
ninety days from approval hereof. 
Section 9. Separability Clause. - If for any reason any section or provision of 
this Act is declared to be unconstitutional or invalid, the other sections or provisions 
thereof which are not affected thereby shall continue to be in full force and effect. 
Section 10. Repealing Clause. - All laws, decrees, orders, rules or regulations or 
parts thereof inconsistent with the provision of this Act are hereby repealed, amended, or 
modified accordingly. 
Section 11. Effectivity. -This Act shall take effect fifteen (15) days following its 
publication in the Official Gazette or in two (2) newspapers o€ general circulation, 
whichever comes earlier. 
Approved,