Vice President Sara Duterte’s camp had tried to persuade the Commission on Audit (COA) not to issue an audit observation memorandum (AOM) during its review of multimillion-peso confidential funds spent by her office and the Department of Education (DepEd) in 2023, according to state auditor Roderick Wamil.
Rather than an AOM, Roderick Wamil told the Senate impeachment court on Tuesday, Aug. 4, that Duterte’s officials asked the government auditors to issue an “audit query” should they find issues in their audit of the confidential funds.
An AOM is a written notification to a government agency that identifies deficiencies in the audit and requires it to submit supporting documents.
Wamil took the witness stand again at the resumption of Duterte’s impeachment trial that focused on the charge that she misused ₱612.5 million in confidential funds allocated to her office and the Department of Education (DepEd) when she was its secretary.
Continuing her direct examination, House prosecutor Lorna Kapunan asked about the state auditor’s meeting with Duterte’s representatives. Wamil said he was called to a meeting in the second week of September 2023.
Meeting with COA
One of the officials representing Duterte at the meeting was Michael Poa, who is now part of her defense team in the impeachment trial, Wamil said. Poa was then the spokesperson and DepEd undersecretary when Duterte served concurrently as education secretary.
Also present, he said, were OVP chief of staff Zuleika Lopez, former COA assistant commissioner Nilda Plaras, and state auditor Gloria Camora.
He said he could not recall who called for the meeting, but he was told to attend because he was in charge of auditing the confidential funds of the OVP and DepEd under the COA-Intelligence and Confidential Fund Audit Unit (Icfau).
Kapunan asked Wamil if he knew Poa, who was on the floor at that time as defense lawyer. He said Poa had introduced himself to him, while Lopez introduced herself as Duterte’s chief of staff.
“They asked about the liquidation process of confidential funds and supporting documents required with respect to liquidation,” the witness said.
Wamil said Plaras, who headed COA-Icfau then, referred Lopez and Poa to Joint Circular 2015-01, which states the guidelines governing confidential funds.
“Plaras also told them that in case there are findings in their audit, an AOM will be issued,” Wamil said, adding, “They asked if instead of an AOM, in case there is an audit finding, an audit query be issued on them.”
Supporting documents
Asked by Kapunan if he knew what an audit query is, he said he was not familiar with it as it was not among the issuances under the joint circular.
The state auditor said Icfau did not agree with the officials’ suggestion of an audit query “as this was not sanctioned in the joint circular.” COA eventually issued an AOM after its audit findings on the OVP and DepEd confidential funds in the same month.
Wamil said that when they were serving the AOM, they were told no one at the OVP was authorized to receive it. Still, the OVP sent Ifcau a revised accomplishment report on the same day.
Last Monday, Wamil testified that the OVP failed to provide documents to back its use of confidential funds during the 11 days it spent them in 2022 or from Dec. 21–30 that year. When it did, the supporting evidence was insufficient, including the payment of rewards to informants, as only acknowledgment receipts, and not official receipts, were submitted.
He also testified that the OVP spent millions of pesos on “unallowable” expenses under the joint circular, including food and medicine aid, and travel incentives.
On Tuesday, the same findings were made when the prosecution panel reviewed the OVP’s spending from the first to third quarter of 2022 through its submission of disbursement vouchers, liquidation reports, accomplishment reports, and government checks.
Rewards to informants
For instance, Wamil noted that in the OVP’s accomplishment report for the first quarter of 2023, there were payments of rewards to informants, but no documents were submitted to prove that it resulted in a successful activity.
Moreover, he said, unallowable expenses were incurred during the disbursement of confidential funds of the DepEd covering the first three quarters of 2023. These included food aid and medicine, and travel incentives.
Kapunan noted that DepEd’s list of confidential activities such as the elimination of recruitment of teachers and learners by communist and leftist groups, and increased community participation in reporting abuses of learners—was not backed with documents detailing them.
She also pointed out the millions of pesos spent by the OVP during the 11 days in December 2022, such as the ₱10-million purchase of information, ₱10-million purchase of supplies, and ₱11 million in reward payment per Section 1 of the joint circular.
The provision stated that “COA shall promulgate accounting and auditing rules and regulations, including those for the prevention of irregular, unnecessary, excessive, extravagant or unconscionable expenditures for uses of government and property.”
Kapunan asked Wamil for his findings on whether the use of confidential funds should be considered irregular, unnecessary, excessive, or unconscionable.
Poa objected, saying this was a “call to conclusion” question. But Senate presiding judge Francis Escudero asked Wamil to reply.
“It’s under irregular expenditures because they are not compliant with the provisions of the joint circular,” the witness said.
Evidence of personal use
Kapunan also cited a provision in the circular stating that the failure of an accountable officer to liquidate shall be prima facie evidence of personal use or benefit.
“What prima facie evidence under [Item] 8.3 means is that there was a presumption that the funds were used for the personal use and benefit of the accountable officer,” Wamil said.
“So if the accountable officer—and can you say that the Vice President and concurrently secretary of education, can you say that she is the accountable officer?” Kapunan asked.
“Yes, because under the joint circular, it shall be the responsibility of the head of agency to oversee the agency-wide use of the confidential fund and to ensure compliance…Also, the Vice President, in her capacity as vice president of the Philippines and secretary of the DepEd, attested to the certification of accountable officers that the fund was used for their confidential expenses,” he said.
“I think this is no longer prima facie evidence, if you were to ask me. This is a scam,” Kapunan said. Poa objected to her remark as “out of order” and sought and got from Escudero to have her statement stricken off the record. CS
