What is the Commission on Audit?

In the book of Cruz, the Commission on Audit is best described as a watchdog of the
financial operations of the government. This is an important constitutional role as the
stability of government depends to a considerable degree on the integrity of
government depends to a considerable degree on the integrity of its fiscal policies and
transactions. So many regimes have floundered and collapsed because of their
improvident and irregular management of public funds and properties. This can be
avoided in our country with a vigilant and conscientious Commission on Audit. (p.83,
Political Law, Cruz 2022)
The Commission on Audit (COA) is the Philippines' Supreme State Audit Institution.
The Philippine Constitution declares its independence as a constitutional office, grants
it powers to audit all accounts pertaining to all government revenues and
expenditures/uses of government resources and to prescribe accounting and auditing
rules, gives it exclusive authority to define the scope and techniques for its audits, and
prohibits the legislation of any law which would limit its audit coverage.
(https://lawphil.net/administ/coa/coa.html)
Powers (Administrative and Quasi-Judicial)
Mandate
Under Article IX-D of the 1987 Philippine Constitution, the Commission on Audit (COA)
is mandated to perform the following:
· 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 [Section 2(1)];
· Promulgate accounting and auditing rules and regulations including those for
the prevention and disallowance of irregular, unnecessary, excessive, extravagant or
unconscionable expenditures, or uses of government funds and properties [Section
2(2)];
· Submit annual reports to the President and the Congress on the financial
condition and operation of the government. (Section 4);
· Recommend measures to improve the efficiency and effectiveness of
government operations. (Section 4); and
· Keep the general accounts of government and preserve the vouchers and
supporting papers pertaining thereto. [Section 2(1)].
The Constitution primarily tasks COA to audit government agencies/entities. The
jurisdiction of COA encompasses the Philippine Government, its subdivisions,
agencies or instrumentalities, including government-owned or controlled corporations
with original charters. Such jurisdiction also extends to constitutional bodies,
commissions and offices that have been granted fiscal autonomy under the
Constitution, autonomous state colleges and universities, other government-owned or
controlled corporations and their subsidiaries, and non-governmental entities receiving
subsidy or equity, directly or indirectly, from or through the Government, which are
required by law or the granting institution to submit to the audit of COA as a condition
of subsidy or equity. The Constitution further provides that no law shall be passed
exempting any entity of the Government or its subsidiary in any guise whatsoever, or
any investment of public funds, from the jurisdiction of COA.
The COA audit teams under the National, Local and Corporate Government Sectors
regularly perform financial, compliance and performance audits on the agencies
assigned to them. Special audits (agency-based performance audit, governmentwide
performance audit, sectoral performance audit, rate audit, levy audit, and subsidy
audit) and fraud audit are being performed by the Special Audits Office and Fraud
Audit Office, respectively. Special audit and fraud audit are being conducted on
selected government entities or subject matters, in consideration of COA’s strategic
thrusts and advocacy of stakeholders.
In the conduct of its audits, COA engages the technical expertise of its personnel in
the fields of engineering, information technology, and others, particularly through the
Technical Services Office and Information Technology Audit Office. COA also
exercises legal and adjudicatory functions on matters pertaining to audit
disallowances/charge/suspension, money claims, relief from accountability, among
others. COA also renders technical services involving consulting services.
On the basis of its mandates and functions, COA renders services which are generally
not transactional or front-line in nature. Most COA services, such as those pertaining
to audit and adjudication, follow timelines in accordance with the requirements
provided by the Constitution, the Presidential Decree No. 1445 otherwise known as
the Government Auditing Code of the Philippines, and its own policies such as the
2009 Revised Rules and Procedure of the Commission on Audit, auditing guidelines,
among others. (https://www.coa.gov.ph/wp-
content/uploads/transparency/citizen_charter/COA_Citizens_Charter_Dec2019.pdf#:
~:text=Conduct%20of%20Performance%20Audit%20Section%202%20%281%29%2
C%20Article,or%20any%20of%20its%20subdivisions%2C%20agencies%2C%20or
%20instrumentalities.)
Composition and Qualification
Article IX-A of the 1987 Constitution
A. COMMON PROVISIONS
Section 1. The Constitutional Commissions
The Constitutional Commissions, which shall be independent are
· The Civil Service Commission;
· The Commission on Elections; and
· The Commission on Audit.
Section 2. Disqualification
No member of a Constitutional Commission shall:
. Hold any other office or employment during his tenure;
2. Engage in the practice of any profession;
3. Engaging in the active management or control of any business which, in any way,
may be affected by the functions of his office; and
4. Being financially interested, directly or indirectly, in any contract with, or in any
franchise or privilege granted by the Government, any of its subdivisions, agencies, or
instrumentalities, including government-owned or controlled corporations or their
subsidiaries.

Section 3. The salary of the Chairman and the Commissioners

The salary of the Chairman and the Commissioners shall be fixed by law and shall not
be decreased during their tenure.
Philippine Politicians Salary Grade 2023

Position Salary Grade Minimum Salary Maximum Salary

Constitutional 31 273,278 312,902
Commission
Chairman
Constitutional 30 185,695 207,978
Commission
Commissioner
Based on Salary Standardization Law (https://philippinego.com/14901/)
The salary increase was executed in the four tranches, with incremental annual raises
implemented during the first four years from 2020 to 2023. The salary increase is
currently in its third tranche.
These four tranches serve as transitional periods for the salary increase, allowing for
a gradual and systematic implementation of the raise.
Section 4. Appointment accordance with law
The Constitutional Commissions shall appoint their officials and employees in
accordance with law.
Section 5. Enjoy Fiscal Autonomy
The Commission shall enjoy fiscal autonomy. Their approved annual appropriations
shall be automatically and regularly released.
Section 6. Promulgate their own Rules
Each Commission en banc may promulgate its own rules concerning pleadings and
practice before it or before any of its offices. Such rules, however, shall not diminish,
increase, or modify substantive rights.
Powers of Supreme Court (SC)
1. The Supreme Court may not, under Art. VIII Sec. 5(5), exercise the power to
disapprove rules of “special courts and quasi-judicial bodies.”
2. In proceedings before the Commissions, the rules of the Commission prevail.
3. In proceedings before a court, the Rules of Court prevail.
4. The Supreme Court may, however, in appropriate cases, exercise JUDICIAL
REVIEW.
Section 7. Decision-Making
1. Each commission shall decide matters or cases by a majority vote of all the
members within 60 days from submission.
2. As COLLEGIAL BODIES, each commission must act as one, and no one member
can decide a case for the entire commission. (i.e. The Chairman cannot ratify a
decision which would otherwise have been void).
Appeals:
· The decisions, orders, or rulings of the COMELEC/COA may be brought on
certiorari to the Supreme Court under Rule 65.
· The decisions, orders, or rulings of the CSC may be brought on certiorari to the
Supreme Court under Rule 43.
Enforcement:
All three constitutional commissions can issue a writ of execution to enforce
judgments, which are final.
Section 8. Perform other Functions Each Commission shall perform such other
functions as may be provided by law.
COMMISSION ON AUDIT
A. Composition & Qualification
SECTION 1 (1), ARTICLE IX-D of the 1987 PHILIPPINE CONSTITUTION
Composition
· 1 Chairman
· 2 Commissioners
Qualification
1. Who shall be natural-born citizens of the Philippines; and,
2. At least thirty-five years of age at the time of their appointment;
3. Certified public accountants with not less than ten years of auditing experience;
4. Members of the Philippine Bar who have been engaged in the practice of law for
at least ten years; and
5. Must not have been candidates for any elective position in the elections
immediately preceding their appointment. At no time shall all Members of the
Commission belong to the same profession.

Case: Cayetano v Monsod

The 1987 Constitution provides in Section 1 (1), Article IX-C:
There shall be a Commission on Elections composed of a Chairman and six
Commissioners who shall be natural-born citizens of the Philippines and, at the time
of their appointment, at least thirty-five years of age, holders of a college degree, and
must not have been candidates for any elective position in the immediately preceding
-elections. However, a majority thereof, including the Chairman, shall be members
of the Philippine Bar who have been engaged in the practice of law for at least
ten years. (Emphasis supplied)
Practice of law means any activity, in or out of court, which requires the application of
law, legal procedure, knowledge, training and experience. "To engage in the practice
of law is to perform those acts which are characteristics of the profession. Generally,
to practice law is to give notice or render any kind of service, which device or service
requires the use of any degree of legal knowledge or skill." (111 ALR 23)
The following records of the 1986 Constitutional Commission show that it has adopted
a liberal interpretation of the term "practice of law." To avoid any misunderstanding
which would result in excluding members of the Bar who are now employed in the
COA or Commission on Audit, we would like to make the clarification that this provision
on qualifications regarding members of the Bar does not necessarily refer or involve
actual practice of law outside the COA We have to interpret this to mean that as long
as the lawyers who are employed in the COA are using their legal knowledge or legal
talent in their respective work within COA, then they are qualified to be considered for
appointment as members or commissioners, even chairman, of the Commission on
Audit.
B. Appointment & Terms/Prohibitions on Re-Appointment
Section 1, Paragraph 2, Article IX-D 1987 Constitution.
Appointment & Terms
COA Chairman Commissioner 1 Commissioner 2
Appointed by The President with the consent of the CA
Initial Term 7 years 5 years 3 years
Succeeding Term 7 years 7 years 7 years
Prohibitions on Re-Appointment
Vacancy: Appointment to any vacancy shall be only for an unexpired portion of the
term of the predecessor.
In no case shall any Member be appointed or designated in a temporary or acting
capacity.
Other Prohibitions: Article IX. Section 2. No member of a Constitutional Commission
shall, during his tenure, hold any other office or employment. Neither shall he engage
in the practice of any profession or in the active management or control of any
business which, in any way, may be affected by the functions of his office, nor shall he
be financially interested, directly or indirectly, in any contract with, or in any franchise
or privilege granted by the Government, any of its subdivisions, agencies, or
instrumentalities, including government-owned or controlled corporations or their
subsidiaries.

Case: Brillantes v Yorac

Article IX-A, Section 1, of the Constitution expressly describes all the Constitutional
Commissions as "independent." Although essentially executive in nature, they are
not under the control of the President of the Philippines in the discharge of their
respective functions. Each of these Commissions conducts its own proceedings
under the applicable laws and its own rules and in the exercise of its own discretion.
Its decisions, orders and rulings are subject only to review on Certiorari by this Court
as provided by the Constitution in Article IX-A, Section 7.
Article IX-C, Section 1(2) of the Constitution that "(I)n no case shall any Member (of
the Commission on Elections) be appointed or designated in a temporary or acting
capacity.
The designation by the President of the Philippines of respondent Haydee B. Yorac
as Acting Chairman of the Commission on Elections is declared
UNCONSTITUTIONAL.
Case: Nacionalista Party v Vera 85 Phil 149
Nacionalista Party and its official candidates for senators against Vicente de Vera, on
two grounds: (1) that he is the father of Teodoro de Vera one of the candidates of the
Liberal Party for the position of senator in the last election and, for that reason, he is
disqualified from acting on all matters connected with said elections; and (2) that his
appointment as Chairman of the Commission on Elections is a violation of the
Constitution and, therefore, it is void ab initio.
Article (X) of the Constitution, is created as an independent administrative body with
the "exclusive charge of the enforcement and administration of all laws relative to the
conduct of elections," with the power to decide "all administrative questions affecting
elections save those involving the right to vote." Under the Constitution the Supreme
Court has no general powers of supervision over the Commission on Elections except
those specifically granted by the Constitution, that is, to review the decisions, orders
and rulings of the Commission which may be brought up properly before the Supreme
Court.
Section 1, Article X of the Constitution
There shall be an independent Commission on Elections composed of a Chairman
and two other Members to be appointed by the President with the consent of the
Commission on Appointments, who shall hold office for a term of nine years and may
not be reappointed. Of the Members of the Commission first appointed, one shall hold
office for nine years, another for six years, and the third for three years. The Chairman
and the other Members of the Commission on Elections may be removed from office
only by impeachment in the manner provided in this Constitution.
Commissioner Vicente de Vera was promoted to occupy this vacancy for the
unexpired term of the former incumbent. There is nothing in that promotion that is
offensive to the Constitution for it does not increase De Vera's term of office to
more than nine years nor does it preclude the appointment of a new member
upon the expiration of de Vera's first term of three years.

Case: Gaminde v COA

In Republic vs. Imperial, The Court said that the operation of the rotational plan
requires two conditions, both indispensable to its workability: (1) that the terms of the
first three (3) Commissioners should start on a common date, and, (2) that any
vacancy due to death, resignation or disability before the expiration of the term should
only be filled only for the unexpired balance of the term.
Consequently, the terms of the first Chairmen and Commissioners of the Constitutional
Commissions under the 1987 Constitution must start on a common date, irrespective
of the variations in the dates of appointments and qualifications of the appointees, in
order that the expiration of the first terms of seven, five and three years should lead to
the regular recurrence of the two-year interval between the expiration of the terms. s
virtual l
Applying the foregoing conditions to the case at bar, The Court rule that the
appropriate starting point of the terms of office of the first appointees to the
Constitutional Commissions under the 1987 Constitution must be on February 02,
1987, the date of the adoption of the 1987 Constitution. In case of a belated
appointment or qualification, the interval between the start of the term and the actual
qualification of the appointee must be counted against the latter.
In the case of Gaminde v. COA term and tenure were defined. The court held that In
the law of public officers, there is a settled distinction between "term" and "tenure.""The
term of an office must be distinguished from the tenure of the incumbent. The term
means the time during which the officer may claim to hold office as of right, and fixes
the interval after which the several incumbents shall succeed one another. The tenure
represents the term during which the incumbent actually holds the office. The term of
office is not affected by the hold-over. The tenure may be shorter than the term for
reasons within or beyond the power of the incumbent.

Case: Matibag v Benipayo

In the case of Matibag vs Benipayo, the concept of ad interim is discussed. An ad
interim appointment is a permanent appointment because it takes effect immediately
and can no longer be withdrawn by the President once the appointee has qualified into
office. The fact that is subject to confirmation by the Commission on Appointments
does not alter its permanent character. The Constitution itself makes an ad interim
appointment permanent in character by making it effective until disapproved by the
Commission on Appointments or until the next adjournment of Congress.
An ad interim appointment is a permanent appointment because it takes effect
immediately and can no longer be withdrawn by the President once the appointee has
qualified into office.
Section 1(2), Art. IX(C): The Chairman and the Commissioners shall be appointed by
the President with the consent of the Commission on Appointments for a term of seven
years without reappointment. Of those first appointed, three Members shall hold office
for seven years, two Members for five years, and the last Members for three years,
without reappointment. Appointment to any vacancy shall be only for the unexpired
term of the predecessor. In no case shall any Member be appointed or designated in
a temporary or acting capacity.
Case: Funa v. The Chairman
In the case of Funa v. Chairman, wherein when the former COA Chairman finished his
7-year term, was subsequently replaced by a Commissioner, who has already served
for 4 years, thus, he was to serve for 3 years only as intended due to the unexpired
term of the former chairman.
The Court restates its ruling on Sec. 1(2), Art. IX(D) of the Constitution, viz:
1. The appointment of members of any of the three constitutional commissions, after
the expiration of the uneven terms of office of the first set of commissioners,
shall always be for a fixed term of seven (7) years; an appointment for a lesser
period is void and unconstitutional.
2. The appointing authority cannot validly shorten the full term of seven (7) years
in case of the expiration of the term as this will result in the distortion of the rotational
system prescribed by the Constitution.
3. Appointments to vacancies resulting from certain causes (death, resignation,
disability or impeachment) shall only be for the unexpired portion of the term of
the predecessor, but such appointments cannot be less than the unexpired
portion as this will likewise disrupt the staggering of terms laid down under Sec. 1(2),
Art. IX(D).
4. Members of the Commission, e.g. COA, COMELEC or CSC, who were appointed
for a full term of seven years and who served the entire period, are barred from
reappointment to any position in the Commission. Corollarily, the first appointees
in the Commission under the Constitution are also covered by the prohibition
against reappointment.
5. A commissioner who resigns after serving in the Commission for less than
seven years is eligible for an appointment to the position of Chairman for the
unexpired portion of the term of the departing chairman. Such appointment is not
covered by the ban on reappointment, provided that the aggregate period of the
length of service as commissioner and the unexpired period of the term of the
predecessor will not exceed seven (7) years and provided further that the vacancy
in the position of Chairman resulted from death, resignation, disability or removal
by impeachment. The Court clarifies that "reappointment" found in Sec. 1(2), Art.
IX(D) means a movement to one and the same office (Commissioner to
Commissioner or Chairman to Chairman). On the other hand, an appointment
involving a movement to a different position or office (Commissioner to
Chairman) would constitute a new appointment and, hence, not, in the strict legal
sense, a reappointment barred under the Constitution.
6. Any member of the Commission cannot be appointed or designated in a
temporary or acting capacity.
C. APPOINTMENT OF PERSONNEL

Sec.4, Article IX-4, 1987 Constitution

SEC. 4. The constitutional commission shall appoint their officials and employees in
accordance with the law.
PROHIBITIONS:
1. The COA Chairman shall be appointed by the President for a term of seven (7)
years, and if he has served the full-term, then he can no longer be reappointed or
extended another appointment.
2. In the same vein, a Commissioner who was appointed for a term of seven (7)
years who likewise served the full term is barred from being reappointed. [Funa v.
Villar, April 24, 2012]
3. In short, once the Chairman or Commissioner shall have served the full term of
seven years, then he can no longer be reappointed to either the position of Chairman
or Commissioner. [Funa v. Villar, April 24, 2012]
The provision, on its face, does not prohibit a promotional appointment from
commissioner to chairman as long as the commissioner has not served the full term
of seven years, further qualified by the third sentence of Sec. 1(2), Article IX (D) that
“the appointment to any vacancy shall be only for the unexpired portion of the term of
the predecessor.” [Funa v. Villar]
To reiterate, the word “reappointment” means a second appointment to one and the
same office; and Sec. 1(2), Art. IX(D) of the 1987 Constitution and similar provisions
do not peremptorily prohibit the promotional appointment of a commissioner to
chairman, provided the new appointee’s tenure in both capacities does not exceed
seven (7) years in all. [Funa v. Villar]
CASE: FUNA V. VILLAR
1. In the case of Funa v. Villar, the appointment of members of any of the three
constitutional commissions, after the expiration of the uneven terms of office of the
first set of commissioners, shall always be for a fixed term of seven (7) years; an
appointment for a lesser period is void and unconstitutional. The appointing authority
cannot validly shorten the full term of seven (7) years in case of the expiration of the
term as this will result in the distortion of the rotational system prescribed by the
Constitution.
2. Appointments to vacancies resulting from certain causes (death, resignation,
disability or impeachment) shall only be for the unexpired portion of the term of the
predecessor, but such appointments cannot be less than the unexpired portion as this
will likewise disrupt the staggering of terms laid down under Sec. 1(2), Art. IX(D).
3. Members of the Commission, e.g. COA, COMELEC or CSC, who were appointed
for a full term of seven years and who served the entire period, are barred from
reappointment to any position in the Commission. Corollarily, the first appointees in
the Commission under the Constitution are also covered by the prohibition against
reappointment.
4. A commissioner who resigns after serving in the Commission for less than seven
(7) years is eligible for an appointment to the position of Chairman for the unexpired
portion of the term of the departing chairman. Such appointment is not covered by the
ban on reappointment, provided that the aggregate period of the length of service as
commissioner and the unexpired period of the term of the predecessor will not exceed
seven (7) years and provided further that the vacancy in the position of Chairman
resulted from death, resignation, disability or removal by impeachment.
CAVEAT: If there is an upgrading of position from commissioner to chairman, the
appointee takes the risk of cutting short his original term, knowing pretty well before
hand that he will serve only the unexpired portion of the term of his predecessor, the
outgoing COA chairman.
5. Any member of the Commission cannot be appointed or designated in a temporary
or acting capacity.
Sec. 1(2) Article. IX-D
(2.) xxx Of those first appointed, the Chairman shall hold office for seven (7) years,
one Commissioner for five (5) years, and the other Commissioner for three (3) years,
without reappointment. xxx
ILLUSTRATION:
CHAIRMAN COMMISSIONER 1 COMMISSIONER 2

Feb. 2, 1987-1994 1987-1992 1987-1990

1994-2001 1992-1999 1990-1997
2001-2008 1999-2006 1997-2004
2008-2015 2006-2013 2004-2011
2015-2022 2013-2020 2011-2018
2022-2029 2020-2027 2018-2025
C. SALARY
ARTICLE XVIII, 1987 CONSTITUTION
SEC. 17. Until the Congress provides otherwise, the President shall receive an annual
salary of three hundred thousand pesos; the Vice-President, the President of the
Senate, the Speaker of the House of Representatives, and the Chief Justice of the
Supreme Court, two hundred forty thousand pesos each; the Senators, the Members
of the House of Representatives, the Associate Justices of the Supreme Court, and
the Chairmen of the Constitutional Commissions, two hundred four thousand pesos
each; and the Members of the Constitutional Commissions, one hundred eighty
thousand pesos each. Section 17 gave the initial salary to high ranking officials that
are relatively more realistic in terms of adequacy than heretofore provided in earlier
laws.

ARTICLE IX, 1987 CONSTITUTION

SEC. 3-A. The salary of the chairman and the commissioners shall be fixed by law
and shall not be decreased during their tenure.
The salaries of the chairman and members are relatively high and may not be
decreased during continuance in office. (Nachura)
● The decrease is prohibited to prevent the legislature from exerting pressure
upon the Commissions by “operating on their necessities.” Salaries may be
increased, as a realistic recognition of the need that may arise to adjust the
compensation to any increase in the cost of living.

D. DISQUALIFICATION
Article IX-A, 1987 Constitution
SEC. 2. No member of a Constitutional Commission shall, during his tenure, hold any
other office or employment. Neither shall he engage in the practice of any profession
or in the active management or control of any business which, in any way, may be
affected by the functions of his office, nor shall he be financially interested, directly or
indirectly, in any contract with, or in any franchise or privilege granted by the
Government, any of its subdivisions, agencies, or instrumentalities, including
government-owned or controlled corporations or their subsidiaries.
Inhibitions/Disqualifications:
a) Shall not, during tenure, hold any other office or employment.
b) Shall not engage in the practice of any profession.
c) Shall not engage in the active management or control of any business which in
any way may be affected by the functions of his office.
d) Shall not be financially interested, directly or indirectly, in any contract with, or in
any franchise or privilege granted by the Government, any of its subdivisions, agencies
or instrumentalities, including government-owned or - controlled corporations or their
subsidiaries. (Nachura)

COVERAGE
Case: Oriondo v. COA
Issues
1. W/N Corregidor Foundation, Inc. is a government-owned or controlled corporation
under the audit jurisdiction of the Commission on Audit.
2. Whether the rule on prohibition of double compensation applies to the case.
Doctrine: A corporation, whether with or without an original charter, is under the audit
jurisdiction of the Commission on Audit so long as the government owns or has
controlling interest in it.
An ex-officio position is “actually and in legal contemplation part of the principal office,”
receiving another set of honoraria and cash gift for rendering services to the
Corregidor Foundation, Inc. would be tantamount to payment of additional
compensation proscribed in Article IX-B, Section 8 of the Constitution.
Corregidor Foundation, Inc. is a GOCC. An entity is considered a government-owned
or controlled corporation if all three (3) attributes are present: (1) the entity is organized
as a stock or non-stock corporation; (2) its functions are public in character; and (3) it
is owned or, at the very least, controlled by the government. Being a GOCC, it is
subject to Department of Budget and Management Circular No. 2003-5 limiting the
payment of honoraria to certain personnel of the government. Furthermore,
petitioners, being employees of the Philippine Tourism Authority, are public officers
prohibited from receiving additional, double or indirect compensation as per
Article IX-B, Section 8 of the Constitution.
Distinction between Chartered and non-Chartered GOCC Article IX Section 2 (1)
of the 1987 Constitution provides that the auditing authority of the Commission over
government-owned corporations extends only to those "with original charter."
Moreover, it has authority not just over accountable officers but also over other officers
who perform functions related to accounting such as verification of evaluations and
computation of fees collectible, and
the adoption of internal rules of control.
An Evaluator/Computer, for instance, is an indispensable part of the process of
assessment and collection and comes within the scope of the Commission's
jurisdiction.
Case: Domato-Togonon
Doctrine: As a rule, the seller must bear all the expenses of the sale's execution and
registration. The parties may decide on a different agreement, but it must be stipulated
in their contract. Without a contrary stipulation, the general rule shall apply.
The Commission on Audit, as the guardian of public funds, has been vested with a
wide latitude of powers "over all accounts pertaining to government revenue and
expenditures and the uses of public funds and property[.]" It is endowed with the
"exclusive authority to define the scope of its audit and examination, establish the
techniques and methods for such review, and promulgate accounting and auditing
rules and regulations." 48 Article IX-D, Section 2 (2) of the Constitution.
As to the taxes on the transfer of real property ownership, Section 135, in relation to
Section 151, 93 of the Local Government Code states that cities are allowed to impose
tax on the sale or on any other mode of transferring ownership or title of real property.
The duty of paying the tax imposed shall be for the seller or transferor's account.
Accordingly, it is the heirs of Plomillo, as sellers, who are duty bound to pay the taxes,
fees, or charges relating to the transfer of real property.
The Commission on Audit maintains that Section 481 of the Local Government Code
prohibits local government units from engaging the services of a private lawyer, Atty.
Joffrey Montefrio (Atty. Montefrio). It cites the February 23, 2015 Sandiganbayan ruling
in People v. Miguel, docketed as Criminal Case No. SB-08-CRM-0018, and insists that
it is the legal officer, as
chief legal counsel of the local government unit, that is duty bound to handle its legal
affairs."
Petitioner should not be held liable for the disallowed amount. The evidence on record
does not show that petitioner's actuations were attended by bad faith, malice, or gross
negligence. Her consistent stance was that the city government was not put at a
disadvantage, but benefited from the reduced offer by the heirs of Plomillo. As
petitioner narrated, after the City Appraisal
Committee had found the heirs’ offer reasonable and advantageous to Koronadal City;
it endorsed the property to Mayor Miguel. It forwarded, among others, a supplementary
report indicating that the property's fair market value was P34,000,000.00 and that
their offer was acceptable. 123 After further evaluation, Mayor Miguel sought authority
from the Sangguniang Panlungsod, of which petitioner was a member. Resolution No.
746 was then passed,authorizing Mayor Miguel to enter into a deed of sale with the
heirs of Plomillo.
IMPEACHMENT
Art XI- Accountability of Public Officers
□ Section 2. The President, the Vice- President, the Members of the Supreme
Court, the Members of the Constitutional Commissions, and the Ombudsman may be
removed from office on impeachment for, and conviction of, culpable violation on the
Constitution, treason, bribery, graft and corruption, other high crimes, or betrayal of
public trust. All other public officers and employees may be removed from office as
provided by law, but not by impeachment.
What is Impeachment?
Ø Impeachment is the process by which a legislative body addresses charges
against a government official.
Impeachable Officials
Ø 1. President
Ø 2. Vice President
Ø 3. Members of the Supreme Court
Ø 4. Members of the Constitutional Commissions
Ø 5. Ombudsman- Section 1 Article XI ( Public officers and employees)
Grounds for Impeachment
Ø 1. Culpable violation of the Constitution
Ø 2. Treason
Ø 3. Bribery
Ø 4. Graft and corruption
Ø 5. Other high crimes
Ø 6. Betrayal of public trust
* Section 2, Article XI
Commencement
● The House of Representative shall have the exclusive power to initiate all cases
of impeachment.
● A vote of at least one-third of all the Members of the House shall be necessary
either to affirm a favorable resolution with the Articles of Impeachment of the
Committee, or override its contrary resolution.
● The vote of each Member shall be recorded (Sec. 3, Art. XI)
Impeachment Proceeding
● Impeachment proceedings are not a single act.
● It is a complexus of acts consisting of a beginning, middle and an end.
● The end is the transmittal of the articles of impeachment to the Senate.
(Francisco vs. House of Representatives, Nov. 10,2003)

Francisco v. House of Rep., Nov. 10, 2003

Ø The middle consists of those deliberative moments leading to the formulation of the
articles of impeachment.
Ø The beginning of the initiation is the filing of the complaint and its referral to the
Committee on Justice.
Initiation in one year
Ø Having concluded that the initiation takes place by the act of filling of the
impeachment complaint and referral to the House Committee on Justice, the initial
action taken thereon, the meaning of Section 3 (5) of Article XI becomes clear.
Ø Once an impeachment complaint has been initiated in the foregoing manner,
another may not be filed against the same official within a one period following Article
XI, Section 3 (5) of the Constitution. (Francisco vs. House of Representative, Nov. 10,
2003)

Impeachment Trial
Ø Section 3
Ø (6) The Senate shall have the sole power to try and decide all cases of
impeachment. When sitting for that purpose, the senators shall be on oath or
affirmation. When the President of the Philippines is on trial, the Chief Justice of the
Supreme Court shall preside, but shall not vote. No person shall be convicted without
the concurrence of two-thirds of all the Members of the Senate.
Ø Section 3
Ø (7) Judgment in cases of impeachment shall not extend further than removal from
office and disqualification to hold any office under the Republic of the Philippines, but
the party shall nevertheless be liable and subject to prosecution, trial, and punishment,
according to law.
Quo Warranto
What is Quo Warranto?
• Rule 66, Rules of Court
• Section 1. - Action by Government against individuals.
• -An action for the usurpation of a public office, position or franchise may be
commenced by a verified petition brought in the name of the Republic of the
Philippines against:
• (a) A person who usurps, intrudes into, or unlawfully holds or exercises a public
office, position or franchise;
• (b) A public officer who does or suffers an act which, by the provision of law,
constitutes a ground for the forfeiture of his office; or
• (c) An association which acts as a corporation within the Philippines without
being legally incorporated or without lawful authority so to act. (1a)
Difference between Quo Warranto and impeachment
v Impeachment concerns actions that make the officer unfit to continue exercising his
or her office, whereas quo warranto involves matters that render him or her ineligible
to hold the position, to begin with.
v Impeachment concerns actions that make the officer unfit to continue exercising his
or her office, whereas quo warranto involves matters that render him or her ineligible
to hold the position, to begin with.
v Impeachment is a proceeding exercised by the legislative, as representatives of the
sovereign, to vindicate the breach of the trust reposed by the people in the hands of
the public officer by determining the public officer’s fitness to stay in the office.”
v Meanwhile, an action for quo warranto, involves a judicial determination of the
eligibility or validity of the election or appointment of a public official based on
predetermined rules. (Republic v. Sereno, G.R. No. 237428, May 11, 2018)
RP v. Sereno, May 11, 2018
● In the case of RP versus Sereno, the Republic contends that respondent's
failure to submit her SALN s as required by the JBC disqualifies her, at the
outset, from being a candidate for the position of Chief Justice. Lacking her
SALNs, respondent has not proven her integrity which is a requirement under
the Constitution. The Republic thus concludes that since respondent is
ineligible for the position of Chief Justice for lack of proven integrity, she has no
right to hold office and may therefore be ousted via quo warranto.
● Respondent insists that she can be removed from office only through
impeachment. She asserted that impeachment was chosen as the method of
removing certain high-ranking government officers to shield them from
harassment suits that will prevent them from performing their functions which
are vital to the continued operations of government.
● The Court ruled that the impeachment is not an exclusive remedy by which an
invalidly appointed or invalidly elected impeachable official may be removed
from office. The language of Section 2, Article XI of the Constitution does not
foreclose a quo warranto action against impeachable officers: “Section 2. The
President, the Vice-President, the Members of the Supreme Court, the
Members of the Constitutional Commissions, and the Ombudsman may be
removed from office on impeachment for, and conviction of, culpable violation
of the Constitution, treason, bribery, graft and corruption, other high crimes, or
betrayal of public trust.”
● The provision uses the permissive term “may” which denote discretion and
cannot be construed as having a mandatory effect, indicative of a mere
possibility, an opportunity, or an option. In American jurisprudence, it has been
held that “the express provision for removal by impeachment ought not to be
taken as a tacit prohibition of removal by other methods when there are other
adequate reasons to account for this express provision.” We hold, therefore,
that by its tenor, Section 2, Article XI of the Constitution allows the institution of
a quo warranto action against an impeachable officer.

RP v. Sereno, June 19, 2018

□ In the case of Republic vs Sereno on June 19, 2018, the OSG (Jose C.
□ Calida) reiterates that respondent's repeated failure to file her Statement of
Assets, Liabilities and Net Worth (SALN) and her non-submission thereof to the JBC
which the latter required to prove the integrity of an applicant affect respondent's
integrity. The OSG concludes that respondent, not having possessed proven integrity,
failed to meet the constitutional requirement for appointment to the Judiciary.
□ Section 2 of Article XI provides that the impeachable officers may be removed
from office on impeachment for and conviction of culpable violation of the Constitution,
treason, bribery, graft and corruption, other high crimes, or betrayal of public trust.
Lack of qualifications for appointment or election is evidently not among the stated
grounds for impeachment. It is, however, a ground for a quo warranto action over
which this Court was given original jurisdiction under Section 5(1) of Article VIII. The
grant of jurisdiction was not confined to unimpeachable officers.
□ In fact, under Section 4, paragraph 7 of Article VII, this Court was expressly
authorized to pass upon the qualifications of the President and Vice-President. Thus,
the proscription against the removal of public officers other than by impeachment does
not apply to quo warranto actions assailing the impeachable officer's eligibility for
appointment or election.
□ To construe Section 2, Article XI of the Constitution as proscribing a quo warranto
petition is to deprive the State of a remedy to correct a public wrong arising from
defective or void appointments. Equity, however, will not suffer a wrong to be without
remedy. It stands to reason, therefore, that quo warranto should be available to
question the validity of appointments especially of impeachable officers since they
occupy the upper echelons of government and are capable of wielding vast power and
influence on matters of law and policy.
What is there in SALN?
● SALN is the statement of assets, liabilities and net worth, and the disclosure of
financial connections or business interests required from each government
employee as a civil servant. The purposes of filing SALN are the promotion of
transparency, full disclosure, and preserving integrity in the civil service. All
public officers and employees are required to declare and submit their accurate,
detailed, and sworn statement of their assets, liabilities, and net worth, including
disclosure of business interest and financial connections, and to declare to the
best of their knowledge their relatives in the government services.
● Sereno’s failure to comply with the Constitutional and statutory requirement of
filing of SALN intimately relates to her integrity. Contrary to Respondent’s
postulation that the filing of SALN bears no relation to the requirement of
integrity, the filing of SALN itself is a Constitutional and statutory requirement
under Section 17, Article XI of the Constitution, R.A. No. 3019, and the Code of
Conduct and Ethical Standards for Public Officials and Employees. Faithful
compliance with the requirement of the filing of SALN is rendered even more
exacting when the public official concerned is a member of the Judiciary.
● Compliance with the SALN requirement indubitably reflects on a person’s
integrity. To be of proven integrity, as required by qualifications under the
Constitution, means that the applicant must have established a steadfast
adherence to moral and ethical principles. In this line, failure to file the SALN
violates the law. The offense is penal in character and breaches the ethical
standards set for public officials and employees. It disregards the requirement
of transparency as a deterrent to graft and corruption. For these reasons, a
public official who has failed to comply with the provision of filing the SALN
cannot be said to be of proven integrity, and the Court may consider them
disqualified from holding public office. Respondent’s argument that failure to file
SALN does not negate goodness does not persuade. Whether or not
Respondent accumulated unexplained wealth is not an issue at this time, but
whether she, in the first place, complied with the mandatory requirement of filing
of SALNs.
APPEAL
Case: AQUINO V. COMMISSION ON AUDIT
Facts:
This case involves a petition filed by Fr. Ranhilio Callangan Aquino and Dr. Pablo F.
Narag, on behalf of the Permanent Employees of the Cagayan State University. The
petitioners question the disallowance of year-end incentives given to university officials
and employees by the Commission on Audit (COA). The incentives were granted
through a special order issued by the university president, Dr. Romeo Quilang, and
were sourced from the unused appropriated income for the year 2014. However, the
COA disallowed the incentives, stating that they were not in accordance with Republic
Act No. 8292, also known as the Education Modernization Act. The COA issued a
notice of disallowance and required the recipients of the incentives to return the
amounts they received. The petitioners argue that the grant of year-end incentives is
authorized under Republic Act No. 8292 and CHED Memorandum Order No. 20,
series of 2011. They also claim that they received the incentives in good faith and
should not be required to return them.
Issue:
The main issues in this case are:
1. Whether the petitioners have the legal personality to file the petition;
2. Whether the petitioners' direct recourse to the Supreme Court is proper;
3. Whether the COA committed grave abuse of discretion in disallowing the year-end
incentives; and
4. Whether the petitioners are required to return the amount they received.
Ruling:
The Supreme Court denied the petition, ruling that the petitioners do not have the legal
personality to file the petition on behalf of the Permanent Employees of the Cagayan
State University. The court emphasized that only natural, juridical, and authorized
entities may become parties to a civil action, and the legal capacity to sue or be sued.
Ratio:
The Supreme Court held that the petitioners, who were representing various
associations and organizations, did not have the legal capacity to sue or bring an
action in court. The Court emphasized that the petitioners failed to establish their
authority to represent the associations they claimed to represent. The Court cited
Section 2, Rule 3 of the Rules of Court, which provides that only natural or juridical
persons or entities authorized by law may be parties in a civil action. The Court further
explained that the legal capacity to sue or be sued is an essential element of a party's
cause of action, and without it, the court cannot acquire jurisdiction over the case.
The Court also ruled that the petitioners' direct recourse to the Supreme Court was
improper. The Court explained that the general rule is that a petition for certiorari
should be filed with the Court of Appeals, and only in exceptional cases may it be filed
directly with the Supreme Court. The Court found no exceptional circumstances in this
case that would warrant a direct filing with the Supreme Court.
Regarding the COA's disallowance of the year-end incentives, the Court held that the
COA did not commit grave abuse of discretion. The Court explained that the COA has
the power to disallow expenditures that are not in accordance with law. In this case,
the COA disallowed the incentives because they were not in accordance with Republic
Act No. 8292 and CHED Memorandum Order No. 20, series of 2011. The Court agreed
with the COA's interpretation of the law and found that the incentives were not
authorized under the said laws.
Lastly, the Court ruled that the petitioners are required to return the amount they
received as year-end incentives. The Court explained that the disallowance of the
incentives rendered them unlawful, and as such, the recipients are obligated to return
the amounts they received. The Court emphasized that the principle of good faith does
not apply in this case, as the recipients were aware that the incentives were being
granted without proper legal authority.
Summary:
The Supreme Court denied the petition filed by Fr. Ranhilio Callangan Aquino and Dr.
Pablo F. Narag on behalf of the Permanent Employees of Cagayan State University.
The Court ruled that the petitioners did not have the legal capacity to sue or bring an
action in court, as they failed to establish their authority to represent the associations
they claimed to represent. The Court also held that the petitioners' direct recourse to
the Supreme Court was improper, as there were no exceptional circumstances that
would warrant a direct filing. The Court upheld the COA's disallowance of the year-
end incentives, finding that they were not authorized under the relevant laws. The
Court further ruled that the recipients of the incentives are required to return the
amounts they received, as the disallowance rendered the incentives unlawful. The
principle of good faith does not apply in this case, as the recipients were aware that
the incentives were being granted without proper legal authority.

Case: AQUINO V. COA

Dec 2014, granting the incentives
Cagayan State University President Dr. Romeo R. Quilang issued a Special Order
granting officials and employers payment of incentives not exceeding Php 40,000.00.
The incentives were sourced from the unused appropriate income for FY 2014.
May 2015, Notice of Disallowance
COA issued the Notice of Disallowance stating that: "The amount of P7,688,000.00
was disallowed in audit since the bases of payment of the year-end incentive to all
CSU officials and employees has legal infirmity as it is not in accord with the provision
of R.A. 8292 otherwise known as the Education Modernization Act."
June 6, 2015 Received the Notice of Disallowance
The Office of the President of the university received the notice of disallowance. The
payees were allegedly not informed which prevented them from appealing the notice
of disallowance before it attained finality.
August 31, 2016
The Commission on Audit issued a notice of finality of decision which was received by
the Office of the Vice-President for Academic Affairs.
Issues:
1. WON petitioners' direct recourse to this Court is proper?
2. WON the respondents commit grave abuse of discretion amounting to lack or
excess of jurisdiction?
The petitioners allege that the Commission on Audit committed grave abuse of
discretion amounting to lack or excess of jurisdiction in holding that the grant of the
2014 year-end incentives was in violation of Republic Act No. 8292, or the Higher
Education Modernization Act of 1997, and in order that the employees return the
amounts they received.
A Notice of Disallowance attains finality if no appeal has been filed within six months
from receipt of the notice. (2009 Revised Rules and Procedure of COA)
An appeal is taken by:
● Filing an Appeal Memorandum with the director of the Commission on Audit
● Within the period of six (6) months from receipt of the Notice of Disallowance.
*The director may reverse, modify, or affirm a Notice of Disallowance, but in case of
reversal or modification, the director's decision is automatically reviewed.
The court ruled on the side of the petitioners, they allege that they were not informed
by the administration of the Notice of Disallowance until it became final. And they only
learned of it through a Memorandum directing them to return the disallowed year-end
incentives.
Records show that the respondent did not properly serve the notice of disallowance.
Ms. Monaliza Guzman (Guzman), the University Accountant, was not served a copy,
contrary to Section 7, Rule IV of the 2009 Revised Rules of Procedure.
Instead, it was received by the Chief Administrative Officer through Ms. Norlie Maa on
June 3, 2015. While Ms. Guzman was addressed in the letter, there was no showing
that the Notice was served to her.
A notice of disallowance must be served to each and every person that the respondent
holds liable. However, when there are several payees, service to the accountant is
constructive service to all payees held liable:
Section 7, 2009 Revised Rules of Procedure of the Commission on Audit.
SECTION 7. Service of Copies of ND/NC/NS, Order or Decision. – The ND, NC, NS,
order, or decision shall be served to each of the persons liable/responsible by the
Auditor, through personal service, or if not practicable through registered mail. In case
there are several payees, as in the case of a disallowed payroll, service to the
accountant who shall be responsible for informing all payees concerned, shall
constitute constructive service to all payees listed in the payroll.
The lack of proper service of the notice of disallowance prevented petitioners from
appealing or seeking reconsideration before its finality. This Court agrees with
petitioners that they only had constructive notice of the disallowance when the Office
of the President issued Memorandum OP-5004-MEMO-2016-08-175 directing them
to return the disallowed incentives. Thus, we do not find that petitioners opted not to
file an appeal or reconsideration before the respondent, as they were not properly
informed of the notices' issuance.
As petitioners did not have adequate remedies when the disallowance lapsed into
finality, they were constrained to file this petition for certiorari consistent with Section
1, Rule XII of 2009 Revised Rules and Procedure of COA
Section 1, Rule XII, 2009 Revised Rules and Procedures of the COA
SECTION 1. Petition for Certiorari. - Any decision, order or resolution of the
Commission may be brought to the Supreme Court on certiorari by the aggrieved party
within thirty (30) days from receipt of a copy thereof in the manner provided by law
and the Rules of Court.
When the decision, order, or resolution adversely affects the interest of any
government agency, the appeal may be taken by the proper head of that agency.
Respondent argues that certiorari is not the proper remedy for petitioners' lost appeal.
Petitioners had adequate recourse by appealing the Notice of Disallowance to it but
failed to do so Development Bank of the Philippines v. Commission on Audit explained
that the essence of due process in proceedings before the respondent is not the
service of notice per se, but the opportunity to be heard, or to seek reconsideration of
the Notice of Disallowance
We remember that the essence of due process is simply the opportunity to be heard
or, as applied to administrative proceedings, the opportunity to explain one's side or
the opportunity to seek a reconsideration of the action or ruling complained of. In the
application of the guarantee of due process, indeed, what is sought to be safeguarded
is not the lack of previous notice but the denial of the opportunity to be heard. As long
as the party was afforded the opportunity to defend his interests in due course, he was
not denied due process.
No, Respondent alleges that it did not commit grave abuse of discretion in disallowing
the year-end incentives. It states that under Republic Act No. 8292, the power to
disburse a state university's funds belongs to the board of regents and not the
university president.

Case: SOCIAL SECURITY SYSTEM V. COMMISSION ON AUDIT

Facts
This case involves a Petition for Certiorari filed by the Social Security System (SSS)
against the Commission on Audit (COA). The case revolves around the disallowance
of the payment of Collective Negotiation Agreement (CNA) incentives to employees of
the SSS-Central Visayas Division.
From January 2005 to December 2009, the SSS Central Visayas Division granted
CNA incentives to its employees amounting to P41,311,073.83. The incentives were
granted based on several resolutions issued by the Social Security Commission.
However, the COA issued a Notice of Disallowance, stating that the grant of incentives
was disallowed for lack of legal basis and failure to comply with the rules in the grant
of incentives.
Issue
The main issue in this case is whether the grant of CNA incentives to SSS employees
complied with the relevant laws and regulations.
Ruling
The Court ruled in favor of the COA and upheld the disallowance of the incentives.
Ratio
The Court found that the grant of incentives did not comply with the provisions of
Budget Circular No. 2006-1, Administrative Order No. 135, and Public Sector Labor-
Management Council Resolution No. 2, series of 2003. These regulations provide
guidelines and requirements for the grant of incentives to government employees.
The Court explained that the COA has the exclusive authority to promulgate
accounting and auditing rules and regulations, including those for the prevention of
irregular expenditures. The grant of incentives without full compliance with the rules
and regulations is considered an irregular expenditure.
The Court also emphasized that the funds of the SSS are held in trust for the benefit
of workers and employees in the private sector. The authority of the SSS to allocate
funds for salaries and benefits of its officials and employees is not absolute and
unrestricted. The salaries and benefits must be reasonable and in accordance with the
law and established rules.
Based on these findings, the Court concluded that there was no grave abuse of
discretion on the part of the COA in disallowing the incentives paid to SSS employees.
Summary
In summary, the Court upheld the disallowance of the CNA incentives granted to SSS
employees by the COA. The Court found that the grant of incentives did not comply
with the relevant laws and regulations and that the COA had the authority to disallow
irregular expenditures. The Court emphasized the importance of compliance with rules
and regulations in the allocation of funds for salaries and benefits. Therefore, the SSS
employees were ordered to refund the disallowed incentives based on principles of
unjust enrichment.

First, whether or not the respondent's CGS-Cluster 2 Decision became final and
executory for the failure of the petitioner to file its Petition for Review on time
I
As a general policy, this Court sustains the decisions of administrative authorities,
especially those by constitutionally created bodies like the Commission on Audit, "not
only on the basis of the doctrine of separation of powers but also of their presumed
expertise in the laws they are entrusted to enforce."
A judgment or final order or resolution of the Commission on Audit may only be brought
before this Court by a party through a petition for certiorari under Rule 65. Further, the
Rule 65 petition will only be entertained when the Commission on Audit acted without
jurisdiction or in excess of jurisdiction, or with grave abuse of discretion amounting to
lack of jurisdiction. Grave abuse of discretion exists "when there is an evasion of a
positive duty or a virtual refusal to perform a duty enjoined by law or to act in
contemplation of law as when the judgment rendered is not based on law and evidence
but on caprice, whim, and despotism."
Presidential Decree No. 1445 provides that a person aggrieved by the decision of an
auditor may, within six months from receipt of a copy of the decision, appeal in writing
to the Commission. Under Rule V of the 2009 Revised Rules of Procedure of the
Commission on Audit, as amended, an appeal from the decision of the auditor to the
director should be made by filing an Appeal Memorandum within six months from the
receipt of the decision appealed from. Thereafter, Rule VII, Section 3 of the same
Rules provides that a petition for review of the Director's decision to the Commission
on Audit Proper shall be filed within the time remaining of the six-month period under
Rule V, Section 4, taking into account the suspension of the running thereof under
Rule V, Section 5.
In Abpi v. Commission on Audit, this Court held that the Special Audit Office's
Decision, upholding the validity of the Notices of Disallowances, became final and
executory, because the "petitioner filed the Petition for Review beyond the
reglementary period which is six (6) months or 180 days after receipt of copies of the
Notices of Disallowances."
Here, the records show that the petitioner received the Notice of Disallowance on June
26, 2012, and filed its Appeal Memorandum 178 days later on December 21, 2012.
Thus, the petitioner only had two days left to file its Petition for Review before the
Commission on Audit Proper.
Meanwhile, the CGS-Cluster 2 issued its Decision on January 27, 2015, which the
petitioner appealed to the Commission on Audit Proper on March 12, 2015. Whether
we reckon the two-day remaining period from March 5, 2015, when the petitioner's
President and Chief Executive Officer received the CGS-Cluster 2 Decision, or on
March 9, 2015, when the petitioner's Corporate Legal Counsel received the same
Decision, its Petition for Review filed on March 12, 2015, was still beyond the two days
remaining of the six-month period. A decision of the Commission or auditor upon any
matter within its jurisdiction shall be final and executory if not properly appealed. Thus,
the CGS-Cluster 2 Decision became final and executory, for the petitioner's failure to
appeal within the reglementary period.
Petitioner failed to show how the respondent committed grave abuse of discretion or
acted out of caprice, whim, or despotism when it merely dismissed the Petition for
being filed out of time according to its rules of procedure. Nevertheless, even if this
Court ignores the procedural infirmity and rules on the merits, the Petition must still be
dismissed.
@ Case: To begin with, Article IX-A, Section 7 of the Constitution provides that
decisions,
orders or rulings of the Commission on Audit may be brought to the Supreme Court
on certiorari by the aggrieved party. Under Rule 64, Section 2, 1997 Rules of Civil
Procedure, a judgment or final order of the Commission on Audit may be brought by
an
aggrieved party to this Court on certiorari under Rule 65. However, the petition in this
case was filed on June 17, 1996, prior to the effectivity of the 1997 Rules of Civil
Procedure. Nevertheless, the mode of elevating cases decided by the Commission of
Audit to this Court was only by petition for certiorari under Rule 65, as provided by the
1987 Constitution. The judgments and final orders of the Commission on Audit are not
reviewable by ordinary writ of error or appeal via certiorari to this Court. Only when the
Commission on Audit acted without or in excess of jurisdiction, may this Court
entertain
a petition for certiorari under Rule 65. Hence, a petition for review on certiorari or
appeal by certiorari to the Supreme Court under Rule 44 or 45 of the 1964 Revised
Rules of Court is not allowed from any order, ruling or decision of the Commission on
Audit. G.R. No. 125129 March 29, 1999 JOSEPH H. REYES, vs. COMMISSION ON
AUDIT
FISCAL AUTONOMY
The fiscal autonomy of the Commission on Audit (COA) refers to the independence
and financial self-sufficiency granted to the COA as a constitutional body tasked with
auditing government funds and ensuring transparency and accountability in the use
of public resources.

Fiscal autonomy means that the COA has the authority to manage its own budget
and financial affairs without undue interference from external entities, such as the
executive or legislative branches of government. This autonomy is essential to
enable the COA to perform its auditing functions objectively and impartially.

By having fiscal autonomy, the COA can allocate resources, hire staff, and conduct
audits based on its professional judgment and priorities, free from external
pressures that might compromise its ability to scrutinize government spending
effectively. This independence is crucial for maintaining the integrity of the auditing
process and upholding the principles of good governance.

Case: ARAULLO V. AQUINO

In the case of Araullo v. Aquino, the Court said, it is likewise important to underscore
that the reversion to the General Fund of unexpended balances of appropriations -
savings included - pursuant to Section 28 Chapter IV, Book VI of the Administrative
Code does not apply to the Constitutional Fiscal Autonomy Group (CFAG), which
include the Judiciary, Civil Service Commission, Commission on Audit, Commission
on Elections, Commission on Human Rights, and the Office of the Ombudsman. The
reason for this is that the fiscal autonomy enjoyed by the CFAG - . . . contemplates a
guarantee of full flexibility to allocate and utilize their resources with the wisdom and
dispatch that their needs require. It recognizes the power and authority to levy, assess,
and collect fees, fix rates of compensation not exceeding the highest rates authorized
by law for compensation and pay plans of the government and allocate and disburse
such sums as may be provided by law or prescribed by them in the course of the
discharge of their functions.
Fiscal autonomy means freedom from outside control.
The Judiciary, the Constitutional Commissions, and the Ombudsman must have the
independence and flexibility needed in the discharge of their constitutional duties.
The imposition of restrictions and constraints on the manner the independent
constitutional offices allocate and utilize the funds appropriated for their operations is
anathema/abhorrent to fiscal autonomy and violative not only of the express mandate
of the Constitution but especially as regards the Supreme Court, of the independence
and separation of powers upon which the entire fabric of our constitutional system is
based.

Case: CONFEDERATION V. CIR

In the case of Confederation v. CIR, the Court ruled, that the fiscal autonomy enjoyed
by the Judiciary, Ombudsman, and Constitutional Commissions, as envisioned in the
Constitution, does not grant immunity or exemption from the common burden of paying
taxes imposed by law.
To borrow former Chief Justice Corona's words in his Separate Opinion in Francisco,
Jr. v. House of Representatives, "fiscal autonomy entails freedom from outside control
and limitations, other than those provided by law. It is the freedom to allocate and
utilize funds granted by law, in accordance with law and pursuant to the wisdom and
dispatch its needs may require from time to time."
It bears to emphasize the Court's ruling in Nitafan v. Commissioner of Internal
Revenue that the imposition of taxes on the salaries of Judges does not result in
diminution of benefits. This applies to all government employees because the intent of
the framers of the Organic Law and of the people adopting it is "that all citizens should
bear their aliquot part of the cost of maintaining the government and should share the
burden of general income taxation equitably."
AUDIT SCHEMES & JURISDICTIONS
The Commission on Audit (COA) in the Philippines is a constitutional body with the
primary mandate of ensuring transparency, accountability, and effective management
of public funds. The COA has jurisdiction over all government entities, including
departments, agencies, bureaus, and instrumentalities at the national and local levels.
Its primary functions include the audit of government revenues, expenditures, and
uses of funds and the examination of the efficiency and effectiveness of government
operations.
The audit scheme conducted by the COA involves various types of audits to assess
different aspects of government financial transactions:
1. Financial Audit:
This type of audit focuses on examining government agencies' financial statements
and transactions to ensure accuracy, reliability, and compliance with accounting
standards and regulations.
2. Compliance Audit:
COA conducts compliance audits to assess whether government agencies adhere to
laws, rules, and regulations governing the use of public funds.
3. Performance Audit:
Performance audits evaluate the efficiency, effectiveness, and economy of
government programs and projects, aiming to enhance the delivery of public services.
4. Special Audit:
COA may conduct special audits in response to specific concerns or issues raised by
government agencies, lawmakers, or the public. These audits are tailored to address
particular circumstances.
Pre-Audit

In 2009, as per COA Circular No. 2009-0002, dated May 18, 2009, the commission
has reinstituted selective pre-audit on government transactions. It defines pre-audit
as the examination of documents supporting a transaction or series of transactions
before these are paid for and recorded. It operates to determine that the proposed
expenditure is for a purpose in compliance with the appropriation law, other specific
statutory authority and regulations; assure that sufficient funds are available to
enable payment of the claim; initially determine that the proposed expenditure is not
illegal, irregular, extravagant, excessive, unconscionable or unnecessary; determine
that the transaction is approved by proper authority and duly supported by authentic
underlying evidences.

However, as per COA Circular No. 2011-002, dated July 22, 2011, the commission
has withdrawn the selective pre-audit of government transactions under COA
Circular No. 2009-002, and subsequently lifted all pre-audit activities being
performed on government agencies, government owned and/or controlled
corporations and local government units, except those required by existing law. It is
aimed at accelerating the delivery of public services and ensuring facilitation of
government transactions. Hence, pre-audit activities are henceforth entrusted as
responsibility of the agencies concerned as part of their accounting and fiscal
processes.

Post-Audit

Post audit includes a final determination that the transaction is not illegal, irregular,
extravagant, excessive, unconscionable or unnecessary. In general and wherever
practical, the scope of post audit work covers all areas identified in the risk
assessment and embraces financial, compliance, and value-for-money audits.
Transactions subject to pre-audit shall be post audited without re-performing the
audit procedures previously undertaken in pre-audit, unless there is compelling
reason to re-perform the same (COA Circular No. 2009-0002).

The COA exercises its jurisdiction independently and may issue recommendations,
observations, or disallowances based on its audit findings. The reports generated from
these audits are submitted to the President, Congress, and concerned agencies for
appropriate action. The COA also plays a crucial role in holding public officials
accountable for the use of public funds, contributing to good governance and fiscal
responsibility.
The COA's audit scheme and jurisdiction are essential components of the Philippine
government's accountability framework, ensuring that public resources are utilized
efficiently, effectively, and in compliance with legal and regulatory requirements.
So, who audits COA?

The Commission on Audit (COA) undergoes a thorough system of checks and

balances through audits conducted by several constitutional branches and
agencies. The President holds the power and duty to ensure the faithful execution
of laws, allowing them to mobilize executive departments and investigative bodies,
such as the National Prosecution Service and the National Bureau of Investigation,
to address any irregularities within the COA. Additionally, the Congress, particularly
the House of Representatives, has the authority to launch impeachment
proceedings against COA Commissioners for valid grounds, with the Senate
responsible for trying and deciding on the case.

The Civil Service Commission (CSC) also plays a crucial role in auditing the COA
by virtue of its power to establish a career service and enforce the Code of Conduct
and Ethical Standards for Public Officials and Employees. In case of misconduct or
violations of civil service laws within the COA, the CSC can institute administrative
actions and disciplinary measures. Furthermore, the Ombudsman is empowered to
independently investigate any illegal, unjust, or improper acts within the COA,
ensuring accountability and ethical standards. The Supreme Court holds the
authority to determine if there has been a grave abuse of discretion within any
branch of the government, including the COA, thereby subjecting it to judicial
scrutiny. In summary, the COA operates within a framework of robust accountability,
being audited and checked by various constitutional entities to uphold transparency
and effectiveness in government operations.