COMMISSION ON AUDIT CIRCULAR NO.

85-246 November 6, 1985

TO : The Municipal Mayor, the Municipal Treasurer and All Other Heads of
Departments, Muntinlupa, Metro Manila; the Governor and the Commissioner
of Finance, Metro Manila Commission; COA Managers; the COA Regional
Director of the National Capital Region, the Auditor of Metro Manila Commission,
the Unit Auditor MAU-Muntinlupa, and the City Auditor of Pasay; and All Others
Concerned.

SUBJECT : Institution of Temporary Special Controls for Certain Classes of Transactions of

the Municipal Government of Muntinlupa, Metro Manila.

1.0 RATIONALE

Municipal Government of Muntinlupa, Metro Manila indicate the existence of

weaknesses in that Municipal Government's internal control systemAn initial report on
the Comprehensive Audit of various transactions of the

In order to pinpoint specific deficiencies and develop appropriate remedies, it is

necessary to closely observed and monitor all phases of financial transactions,
particularly procurement and infrastructure projects, and evaluate their efficiency in
meeting the Municipal Government's requirements.

Accordingly the audit of the financial transactions of the Municipal Government of

Muntinlupa Metro Manila is hereby considered an exceptional case and temporarily
exempted from the provisions of COA rules and regulations with respect to review of
contracts, evaluation of projects whether undertaken by contract or administration, and
inspection of deliveries of supplies, materials and equipment of any nature and amount.

2.0 AUDIT ACTIVITIES WHICH SHALL BE PRE-REQUISITES TO PAYMENT OF CLAIMS

The following audit activities of the Commission on Audit shall be pre-

requisites to the payment of claims by the Municipal Government of Muntinlupa, Metro
Manila.

2.1 Inspection of supplies, materials and equipment delivered, and services

rendered, and pre-repair inspection of property.

2.2 Inspection and evaluation of infrastructure and other construction project

accomplishment.

3.0 AUDIT REQUIREMENTS WHICH SHALL BE STRICTLY ENFORCED

The following audit requirements are hereby reiterated and shall be strictly
enforced:

3.1 Submission to the Assistant Municipal Auditor of contracts (including variation

 orders and purchase/letter orders) and each of all the documents forming part
thereof by reference or incorporation, within five (5) days from the execution or
issuance of the contract in accordance with COA Circular No. 76-34 dated July
15, 1976, as amended.

3.2 Disallowance in audit of all claims for payment of supplies, materials and
equipment delivered, and services rendered, or for first payment on contracts
and variations thereto unless a copy of the contract and other documents
herein referred to are first submitted.

4.0 DUTIES AND RESPONSIBILITIES OF CITY OFFICIALS

4.1 The Municipal Treasurer shall see to it that no claims covered by this
circular are paid without evidence of the audit action of the Assistant
Municipal; Auditor required under Sec. 2.0 hereof (in addition to the
other audit requirements under existing laws and rules), specially the
following:

4.1.1 Pre-repair inspection report.

4.1.2 Inspection report on project accomplishment for each payment on a

contract materials and equipment, and services rendered

4.2 The Municipal Mayor shall submit to the Assistant Municipal Auditor for review copies
of contracts and supporting documents within five (5) days from the execution or
issuance of the contract in accordance with COA Circular No. 76-34 dated July 15,
1976 as amended.

5.0 DUTIES AND RESPONSIBILITIES OF COA OFFICIALS AND REPRESENTATIVES

5.1 The contract review and inspection as provided herein shall be the responsibility
of the Assistant Municipal Auditor of Muntinlupa, Metro Manila. His contract
review and inspection authority shall be without limit. He may elevate to this
Commission, through the Technical Service Office, for decision matters on
which he entertains some doubts. His letter of referral shall contain a
detailed statement of the grounds and reasons for the referral. The
reasonableness of prices may also be referred to the Commission for
determination.

5.2 The Municipal Auditor shall communicate formally in writing to the city official
concerned, the results of his review action on a contract submitted to him
within five (5) days from receipt of the copy of the contract and its required
supporting documents, unless referred to this Commission as provided herein.

5.3 In the review of the contracts the Assistant Municipal Auditor shall be assisted by
personnel of the Technical Service Office of the Commission who shall be
assigned to his office on-call basis in such number and with such types of skills
and expertise as may be needed.

5.4 All inspection and evaluation of project accomplishment and deliveries of

supplies, materials and equipment and services rendered, including pre-repair
 inspection and evaluation of proposed change orders, extra work orders,
supplemental contracts, price escalations and other variation orders shall be
made by COA Technical Property Inspectors. TPIs in such number and with
such types of skills and expertise as may be needed shall be assigned by the
Commission to the Office of the Municipal on call basis. The TPIs so assigned
shall be reshuffled every two months.

5.5 The Assistant Municipal Auditor shall note the inspection report to be prepared by
the TPIs. His notation shall signify that the inspection has actually been
conducted and that the inspector is the only assigned for the purpose.

5.6 The Municipal Auditor shall discharge his duties and responsibilities as head of
the auditing unit in accordance with existing laws and rules.

5.7 Except as otherwise provided herein, all COA Rules and regulations on contract
review and inspection shall be observed.

6.0 REPEALING CLAUSE

All COA Circulars and Memoranda which are inconsistent herewith are hereby
repealed, amended or modified accordingly.

7.0 EFFECTIVITY

This Circular shall take effect immediately.

(SGD.) HERMOGENES P. POBRE, Commissioner

(SGD.) FRANCISCO S. TANTUICO, JR., Chairman