Commission on Audit (COA) Chairperson Michael G. Aguinaldo and United Nations Development Programme (UNDP) Country Director Titon Mitra with COA officials and audit team members, and representatives from the UNDP, National Economic and Development Authority and implementing partners at the General Audit Debriefing on the FY 2015 Harmonized Approach To Cash Transfer (HACT) Transitional Audit Exercise on April 8, 2016.

The Commission on Audit (COA) successfully culminated the FY 2015 Harmonized Approach To Cash Transfer (HACT) Transitional Audit Exercise for the United Nations Development Programme (UNDP)-supported projects and programmes.

COA presented the highlights of the audit and audit opinion rendered on the financial reports at an audit debriefing held at the National Economic and Development Authority (NEDA) Boardroom in Pasig City on April 8, 2016.

The UNDP has sought the assistance of COA to provide annual audit services to UNDP supported projects and programmes. For the 2015 HACT Transitional Audit Exercise, audit teams focused on the areas of cash management, finance, asset management, procurement, general administration, human resource, assessment of the project’s internal control, and a general review of the project’s progress and timeliness in relation to progressed milestones and planned completion date.

Chairperson Michael G. Aguinaldo emphasized the valued partnership between UNDP and the COA while UNDP Country Director Titon Mitra welcomed the efforts of the audit teams in helping the UNDP ascertain the proper use of its resources.

As in the previous audits, COA is bound by the provisions of the Terms of Reference and guided by the UNDP Accounting Policies. In comparison with former UNDP audit exercises however, this present audit focused on the validation of almost 100% of the UNDP assets, exempting only those that are impractical to validate. COA Assistant Commissioner Susan P. Garcia is the Project Manager.

COA, UNDP, and NEDA officials with implementing partners consisting of various government agencies and intergovernmental/non-government organizations and COA audit teams attended the event. # – with report from Jennifer Andrea S. Imperial

Land Bank of the Philippines Assistant Vice President Reynaldo C. Copa explains the features of the new Check Image Clearing System at a presentation before COA officials and auditors on April 7, 2016.

Officials of the Commission on Audit (COA) and representatives from the Land Bank of the Philippines (LBP) discussed the various features and issues relating to the new Check Image Clearing System (CICS) to provide faster movement of funds and reduce or eliminate fraud at a presentation held at the COA CP Boardroom on April 7, 2016.

In the new CICS, a deposited check will be scanned and its electronic payment information and image will be transmitted throughout the entire clearing cycle. The original physical check will be removed from the clearing process. The new system is part of the Philippine Clearing House Corp. (PCHC)’s automated clearing system that integrates the CICS with the Electronic Fund Transfer Network.

LBP Assistant Vice President Reynaldo C. Copa, in his presentation, said the system will address geographical limitation by eliminating movement of physical paper, streamline the process and create a faster & more secured payment exchange environment.

 “This new system will reduce the number of days for a check to be cleared. For instance, if a check deposited within cut-off time or 3 pm today, funds will be made available for withdrawal by 3 pm the next day. There will also be controls put in place to protect the integrity of the scanned checks,” Mr. Copa said.

The six minimum mandatory check security features are: security fibers (visible & invisible), embedded watermark of the PCHC logo, microprint of bank initials along the signatory line, microprint of the security printer’s name along the date line, “Copy” pantograph, and erasable ultraviolet (UV) ink/UV security features. To protect the payee, a drawer’s conformity statement will be included. The new checks will be launched by July 2016.

COA officials, for their part, expressed concern regarding the legality of the scanned checks as evidence, other requirements of investigating bodies and additional security features of the new check clearing system. COA officials said the rules of evidence should catch up with this new development in the banking system.

The LBP representatives also asked COA to revisit COA Circular No. 2012-005 on Prescribing the use of Punong Barangay Certification (PBC) and COA Auditor’s Advice (CAA) which provides, among others, the preparation of the CAA to a Government Servicing Bank holding further payment of checks issued by a barangay that has not submitted a copy of the PBC and other required documents. LBP and COA officials discussed various ways by which barangays can avoid being penalized a hefty amount for stop payments but must still be able to comply with the required documents.

Other LBP officials who attended the presentation were Vice President Ma. Eloisa C. Dayrit (Head, Banking Services Group), Vice President Ana S. Concha (Head, System Implementation Dept.), Mr. Raymond Santos of the System Implementation Dept. and COA-LBP branch manager Lourdes E. Flor. #

Participants at the inception and planning workshop for the Asian Development Bank Project on Enhancing Roles of Supreme Audit Institutions in Selected ASEAN Countries, March 2, 2016.

The Commission on Audit (COA) through the Project Management Office and the Asian Development Bank (ADB) conducted an inception and planning workshop to incorporate the International Standards of Supreme Audit Institutions (ISSAIs) and improve quality of financial audit reports. The workshop was held at the COA Professional Development Center from March 2 to 4, 2016..

The workshop was part of the Regional-Capacity Development Technical Assistance (R-CDTA) conducted by the ADB under the Project on Enhancing Roles of Supreme Audit Institutions in Selected ASEAN Countries financed by the Japan Fund for Poverty Reduction. The State Audit Office of Vietnam, the Office of the Auditor General of the Union of Myanmar, and the State Audit Organization of the Lao People’s Democratic Republic also participated in this project.

COA Chairperson Michael G. Aguinaldo emphasized that “[T]he Commission on Audit is devoted to continuous training which is second nature to us. This workshop will help us take a deeper look at international standards and see how we can apply them in our own practice.”

 “Our development partners also asked us to do some audit work for their projects in the country. It is important that COA is on the same page with implementing agencies and that auditors and management understand where the ADB and our other development partners are coming from. Hopefully, we will be able to meet the requirements of our development partners,” he added.

The workshop aimed to guide implementing agencies in further improving the quality of project financial statements and deepening the understanding of the interlink between financial reporting and auditing.

The R-CDTA will yield three main outputs: (1) the assessment of COA existing guidelines; (2) a piloted and updated COA guidelines on ISSAIs financial audit; and (3) the dissemination of the COA guidelines on ISSAI financial audits to other ASEAN members.

The ADB acknowledged COA’s role as Project Leader for ISSAI Implementation under the Knowledge Sharing Committee, and the Chairperson of the Training Committee, both of the ASEANSAI.

Participants were given an overview on targets and progress of the R-CDTA, ADB investments in the Philippines and External Audit of ADB projects, among others. Participants were also asked for their input on COA’s roles in financial audit as well as discussed COA’s readiness to fully implement ISSAI. At the third day of the workshop, the group held focus group discussions to tackle issues including COA’s Action Plan in improving financial audit guidelines to be aligned with ISSAI. #