Expenses exceeded by P19.5M-A A +A
Monday, January 27, 2014
THE Commission on Audit (COA) 7, which reviewed the finances of Mactan Cebu International Airport Authority (MCIAA) for 2012, divulged that the agency has exceeded by P19.530 million the Corporate Operating Budget (COB) approved by the Department of Budget and Management (DBM).
The comments and observations in the 2012 COA audit report was sent by COA 7 Director Sabiniano Cabatuan to MCIAA General Manager Nigel Paul Villarete and the MCIAA Board of Directors.
The MCIAA Board is composed of Department of Transportation and Communication (DOTC) Undersecretary Jose Perpetuo M. Lotillo as alternate chair; Department of Tourism (DOT) Undersecretary Ma. Victoria V. Jasmin; Department of Finance (DOF) Undersecretary Maria Edita Z. Tan; Department of Justice (DOJ) Assistant Secretary Geronimo L. Sy; retired Brig. Gen. Dodante S. Joya of the Civil Aviation Authority of the Philippines (CAAP); Cebu Gov. Hilario Davide III; Villarete and private sector representatives Pericles P. Dakay and Melanie C. Ng as members.
COA 7 found that after a review of MCIAA’s Statement of Income and Expenses for the year that ended on Dec. 31, 2012, MCIAA’s actual personnel cost reached P240,069,808.66. This exceeded the DBM-approved COB of P220,539,310 by P19.530 million.
COA commented that the P19.530 excess is a contravention to Notes 2 and 8 of the approved COB and Section 4(1) of Presidential Decree (PD) 1445, otherwise known as the Government Auditing Code of the Philippines.
Section 4(1) of PD 1445 provides that “no money shall be paid out of any public treasury of depository except in pursuance of an appropriation law or other specific statutory authority.”
Note 2 provides that disbursements for personnel amelioration/benefit shall be subject to the pertinent compensation laws, rules and regulations, while Note 8 requires compliance to laws on compensation, procurement, budgeting, accounting and auditing.
When sought to comment, Villarete said he could not comment at press time because he did not have the audit report.
He said he will read the audit report today.
According to the COA, the MCIAA management concurred with this audit observation and will make the necessary correction/adjustments on its accounting entries.
The COA also discovered that part of the excess personal service cost in the amount of P4.549 million was charged by MCIAA to a supplemental budget that it did not bear the approval of the DBM, contrary to Section 10 of Executive Order 518 and Section 3.3 of
Corporate Budget Circular (CBC) No. 20.
Section 10 of EO 518 provides that the approval of supplemental budgets shall observe the same procedures as those established for the principal operating budget of the corporation (MCIAA).
Section 3.3 of CBC 20 provides that any increase in the approved principal COB in the course of the budget year as may be warranted by additional corporate receipts shall require submission and approval of a supplemental COB to cover the additional expenditures.
According to the COA report, the MCIAA submitted for review and approval to the DBM its COB for 2012 with P277.6 million appropriated for personal services. However, the proposed budget on this pay item was approved for P220.5 million only or a decrease of P57.1 million, which is approximately 20.58 percent of the budget proposal.
The DBM, the COA report said, decreased the personal services budget due to over-provision of pay items from existing laws, no legal basis and exclusion of items that should be chargeable to savings.
This is not the first time that COA commented that MCIAA, a Government-Owned and Controlled Corp. (GOCC), violated government rules and regulations on spending public funds.
In 2008, MCIAA appropriated P20 million for anniversary and performance bonuses, but DBM disallowed P13.79 million.
In 2009, COA reported that MCIAA granted bonuses to its officials and personnel in the amount of P19.9 million, which has no legal basis.
Published in the Sun.Star Cebu newspaper on January 27, 2014.