MANILA, Philippines - The Commission on Audit (COA) plans to replace the residency system of auditors in government offices to a visitorial system to prevent the occurrence of anomalies similar to those that occurred in the Armed Forces of the Philippines (AFP) during the time of former military comptroller Carlos Garcia. “As you know, we use the residency audit approach, where audit teams hold office in their assigned agencies. This is designed to facilitate the ongoing review of the agency’s operations, programs and activities, especially because we audit them yearly,” said COA chair Ma. Gracia Pulido-Tan in a speech before the Management Association of the Philippines (MAP) at the Manila Peninsula Hotel in Makati City last Tuesday.
“You are also well aware of the consequent problems we have had in this regard. Remember the Garcia affair?” she added.
Tan was referring to former Intelligence Service of the Armed Forces of the Philippines (ISAFP) resident auditor Divina Cabrera who was accused of involvement in fund anomalies in the military. During a Senate investigation last February, it was revealed that she was allowed to hold on to her residency position at the AFP from 1991 to 2005 despite an existing three-year rule. Cabrera was resident auditor of the ISAFP when Garcia was comptroller, the time when he allegedly received gifts, tokens, and bribes from military contractors and suppliers.
These supposed special favors became the basis for the filing of a P303-million plunder case against him at the Sandiganbayan. “While the COA has a residency rule of three years, this has not been implemented consistently. One consideration, I was told, is that a good level of familiarity with the operations of the agency is required for a good audit. But wasn’t it familiarity that was precisely at the root of the Garcia affair?” Tan said.
She said the residency approach is under review which will take some time because COA has about 7,000 people in the field. “Initial findings - and the increasing number of complaints that we have received - strongly indicate, however, that we may have to consider doing away completely with this approach, and instead adopt a visitorial system,” she told MAP members. The visitorial system would recall COA resident auditors to home office and they will instead be assigned field work from time to time, similar to the work setup of external auditors. “Of course, there are logistical concerns and we may just pilot some agencies first. To test the waters, we have resolved to adopt the visitorial audit in one agency, and we are now in the process of fleshing out the details,” Tan said. Tan’s predecessor, former COA chairman Reynaldo Villar, ordered the relief of Cabrera five months ago even if she was no longer with ISAFP, having been transferred to the Philippine Navy.
Garcia, though charged with plunder, entered into a plea bargaining agreement with government prosecutors last year which allowed him to post bail after pleading guilty to lesser offenses. Under the deal, he surrenders some P135.4 million in unexplained wealth including bank accounts, vehicles, and real properties in the Philippines and the United States.