the Interior and Local Government, Bureau of Local Government Finances, etc.
Additionally, the Commission may issue supplemental guidelines to enforce
accounting and auditing rules and regulations pursuant to Article IX-D, Sec. 2(2)
of the 1987 Philippine Constitution.
12.4 Transactions without the required CAF are deemed void under Sec. 87 of the same
Presidential Decree, quoted hereunder:
12.4.1 “Section 87. Void contract and liability of officer. Any contract entered
into contrary to the requirements of the two immediately preceding
sections shall be void, and the officer or officers entering into the contract
shall be liable to the government or other contracting party for any
consequent damage to the same extent as if the transaction had been
wholly between private parties.”
12.5 It must be noted that COA Circular No. 2012-003, dated October 29, 2012 entitled
“Updated Guidelines for the Prevention and Disallowance of Irregular,
Unnecessary, Excessive, Extravagant, and Unconscionable Expenses,” cited the
abovementioned practice – entering into contracts without covering certificates of
availability of funds issued by the Chief Accountant – as an illegal expenditure.
In fact, GR Nos. 151373-74, dated November 17, 2005, in the case of Department
of Health vs. CVCAA, et al., emphasized that any contract entered into in the
absence of the aforementioned CAF shall be deemed void.
12.6 Despite the Municipal Treasurer’s certification as to availability of funds on the
face of the disbursement voucher, and the Municipal Budget Officer’s
certification as to existence of available appropriations on the face of the
obligation request form, it is still an essential condition for the Municipal
Accountant to issue the CAF, as he/she is required by law, to ascertain the
existence of appropriations therefor and the availability of funds to cover the
proposed expenditure.
12.7 We recommended and Management agreed to, henceforth, secure the
Certificate of Availability of Funds (CAF) from the Municipal Accountant,
prior to entering into any contract and before making any disbursement or
obligations charged to any authorized appropriation, in accordance with
Section 86 of PD No. 1445.
Incomplete supporting documents - ₱3,456,340.65
13. Procurement of various goods, materials, and supplies totaling ₱3,456,340.65 was
not supported by appropriate and complete documentation contrary to Section
4(6) of the Presidential Decree (PD) No. 1445 and the Revised Implementing Rules
and Regulations (IRR) of the Republic Act (R.A.) No. 9184, thus, the propriety
and validity of the related disbursements could not be established.
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