Republic of the Philippines COMMISSION ON AUDIT Commonwealth Avenue, Queson City, Philippines CIRCULAR No. Date TO All Heads of Departments, Bureaus, Offices, Agencies and Instrumentalities of the National Government, Heads of the Local Government Units, Managing Heads of Government Owned and/or Controlled Corporations, including _ its subsidiaries, State Universities and Colleges, COA Assistant Commissioners, COA Directors, COA Auditors, and All Others Concemed SUBJECT : Establishing the Criteria to Determine the Actionability of Complaints, Information of Fraud, Requests for Audit and Other Cases Alleging Fraudulent or Anomalous Govemment Transactions, and the Manner of Filing Thereof Before the Commission on Audit RATIONALE 1.1. Section 2{2}, Article [X-D of the 1987 Philippine Constitution vests in the Commission on Audit (COA) the exclusive authority to, among others and subject to limitations, 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. 1.2. In line with this mandate and in furtherance of good governance and for the promotion of transparency and accountability in all government transactions, COA has encouraged the public to report fraudulent or anomalous government transactions through the COA Citizens Desk or by filing complaints and/or requests for fraud audit. 1.3 COA has received and is continually receiving an increasing number of complaints, requests for fraud audit, or information of fraud, some of which have been or may be found to contain unverifiable allegations, involve insignificant amounts, non-auditable issues, or those beyond the jurisdiction of the COA.1.4. This Circular establishes the criteria or conditions that will be used to determine the actionability ofall information/ complaints/requests or other cases received by this Commission. 2. SCOPE This Circular establishes the criteria in determining the actionability of information of fraud, requests for fraud audit, and complaints alleging fraud or anomaly in the use of public funds or property obtained by or filed before the COA, including cases referred by the Office of the Ombudsman (OMB) and other government agencies, and the manner of filing thereof by the public. 3. FILING OF COMPLAINTS OR REQUESTS FOR FRAUD AUDITS 3.1 Any person who has knowledge that the transactions of, or the projects/programs/activities implemented by any government agency is tainted with fraud or anomaly, or that public officials or employees have committed or are committing fraud or anomaly in transactions involving disbursement or receipt/collection of public funds or use of government properties and other government transactions, may file a written information, complaint or request for fraud audit before the Fraud Audit Office (FAO) at the COA Central Office for agencies located in the National Capital Region (NCR) or the Office of the COA Regional Directors for agencies located in the regions, either personally or through mail. They may also send the same to the COA Citizens Desk Reporting System at 3.2. Any govemment agency, including the Office of the Ombudsman, before whom the complaints or cases were originally filed, shall refer the same to the FAO for government agencies in the NCR or COA Regional Offices for government agencies in the regions. 3.3. Fraud refers to an act of deceit, trickery, concealment or breach of confidence used to gain some unfair or dishonest advantage; an unlawful interaction between two entities where one party intentionally deceives the other through means of false representation in order to gain illicit and unjust advantage.' It refers to all kinds of deception - whether through insidious machination, manipulation, concealment or misrepresentation - that would lead an ordinarily prudent person into error afier taking the circumstances into account.* ! XVI Intemational Congress of Supreme Audit Institutions INCOSAT ? Tankeh vs. Development Bank of the Philippines, et al., G.R. No. 171428, November 11, 2013 citing Solidbank Corporation v. Mindanao Ferroalloy Corporation, ef a., 302 Phil. 651, 669 [2005] nC Page 2 of 43.4 Complaint, information of fraud, request for fraud audit or those referred by other government agencies, which are herein collectively referred to as cases, refer to written statements of any person who has knowledge that the transactions of, or the projects/programs/activities implemented by any government agency is tainted with fraud or anomaly, or that public officials or employees have committed or are committing fraud or anomaly in transactions involving disbursement or receipU/collection of public funds or use of government properties and other government transactions. 4, REQUISITES FOR ACTIONABLE CASES. 4.1 Cases are actionable provided that the following requisites are complied: a, They must be in writing, whether on paper or in electronic form; b. They must allege fraudulent or anomalous disbursement or receipt/collection of publie funds and/or use of government property; c. The transaction/s or account/s involved must be described with sufficient particularity, such as but not limited to: the name of the projects/programs/activities; amount involved; location in case of infrastructure projects; year the transaction transpired or project was implemented; name of the person/s involved, if known; the government agency involved; or such other verifiable information/details as shown from documents which must be attached, ifavailable; and 4. They must not merely solicit 2 general audit of all transactions of the agency complained of. Cases found actionable based on these requisites shall be further verified/evaluated by concemed COA officials or employees. 4.2 The Commission shall refer to appropriate govemment agencies allegations of violation of laws, rules and regulations, or acvs complained of that are not within its jurisdiction, such as land disputes involving ownership/boundaries, personnel actions, administrative complaints against agency personnel, tifestyle checks, and the likes. 4.3 Cases shall be dismissed if: a. They involve transactions that have been the subject of a duly issued/released investigation report, or of an ongoing audit investigation of the FAO and Fraud Audit Services of the COA Regional Offices. . Page 3 of 4b. The transaction/issue has been verified to have already been investigated by the OMB or other competent authority and a Notice of Disallowance/Charge/Suspension was already issued by the Audit Team. c. The transactions have transpired more than 10 years ago at the time of filing the case. 4.4 Documents or any form of evidence pertinent to the transactions or projects/programs/activities complained of may be provided by the complainant/requester in support of the allegations. 4.5 The Commission Proper may direct the conduct of fraud audit of a transaction or projects/programs/activities, in the exercise of its discretion, 5. GUIDELINES IN TAKING ACTION ON CASES ‘The guidelines prescribing the rules of procedure shall be issued to implement this Circular. 6. REPEALING CLAUSE Any provision of COA issuances inconsistent with any provisions of this Circular are hereby modified, amended or repealed accordingly. 7. EFFECTIVITY This Circular shall take effect 15 days after its publication in a newspaper of general circulation. ens PARTICIPATE JOSE A. FABIA ROLAND C. PONDOC Commissioner Commissioner ‘AGUINALDO airperson, SSs/FA0, ABSIBRS Page 4 of 4