Office of the General Accountant: Indispensable

Earlier this week, a senator suggested that the opposition must be represented in the Independent Commission for Infrastructure. The nomenclature is so simple, “independent.”  So, to know that it came from a senator (whom we thought all these years is a “lawyer”) is so revolting. If there is a key takeaway from this, it is on the fact that it gave another senator (whom we also thought is a “lawyer”) a good reason to believe that his understanding of the word “forthwith” might be correct after all.

Just for the fact that these kinds of lawmakers are in our midst make us tremble. Why? Due to the fact that despite these obvious mockeries, some of us (lawyers included) do believe they are always right. Therefore, when they steal from the treasury and conceal them with simple terminologies, we must act to stop them deliberately. How? Through adequate internal control.  Now, let us put this into proper perspective.

Let’s learn it from the private sector. Truth to tell, business owners then were just so concerned about how much sales were generated, even if remittances were short. Worst, they simply looked at the passbooks to see if balances were growing without even entertaining the thought that probably some amounts were illegally taken out. Moreover, they took a look at manufacturing activities as a very simple process of delivering the desired volume and quality without even trying to know whether the workers’ (manufacturing department) payrolls were padded. Sadly, they didn’t even care if there were raw materials that were lost through wastages or pilferages.

Today, however, their mindsets have significantly changed. Reasons run from having children (the apparent successors) who are well-schooled and are so concern about having better internal control system or are now aware, that, after all, they have become victims of embezzlements. Consequently, they hire consultants to set up the most appropriate accounting systems and hire accountants to religiously implement them. With this in mind, their organizational structures are so designed that each person does not handle incompatible functions. These are established, in a way, that the cardinal rule of segregation of duties is well observed and checks and balances are assured.

On top of these, most companies made it a policy that their personnel are rotated periodically to ensure that the work of a person shall be reviewed by another and accountabilities are established upon turnover. To ensure success, they made sure that they have very strong accounting departments that shall see to it that the established internal control systems are operating as planned.

The same should have been true (or even more) in government. This is so, because what these public servants deal with are taxpayers’ money. But with a congress and, worst, local government units (LGUs) ran like family-owned corporations by our government leaders (who have made sure their family members and favored friends or employees are in key positions, either by election or appointment), the internal control aspect of governance is set aside.

Truth be told, the government (especially, LGUs) is taking this department for granted. As we all know, LGU accountants are appointed by the Mayors or Governors. In return, they will only report to them. Naturally, no matter how straightforward they maybe, the fact remains that they are still beholden to their mayors or governors. Consequently, these accountants are used by their mayors or governors to deliberately conceal what they (LGU execs) steal by manipulating the accounting records. With no one to run to for protection, they succumb to pressures and are forced to follow. Therefore, as this significant aspect is set aside, corruption flourished.

Obviously, a change is necessary. Owing to the fact that organizationally and functionally, the LGU executives can easily manhandle their accountants, this must be given top priority. First and foremost, an Office of the General Accountant (OGA, a cabinet level position) must be created. This office shall take care of, among others, concerns on internal control and transparency. Thus, it shall carry such tasks as designing and implementing internal control procedures, as well as, in establishing fraud deterrence and corruption prevention measures. Having such functions, the OGA shall deputize all LGU accountants to implement the proper internal control systems. Clearly, therefore, functionally, these LGU accountants shall report directly to the OGA. With that, they shall be shielded from the clutches of these corrupt LGU executives. To further enhance their usefulness, only the General Accountant shall be given that exclusive prerogative to appoint and designate accountants in specific LGUs.

With this in place, we, the citizenry, can be assured of transparency and will be in a better position to fight corruption effectively.