VERSOSA Jr. v. Carague
VERSOSA Jr. v. Carague
VERSOSA Jr. v. Carague
Facts:
This resolves the motion for reconsideration dated March 8, 2011 affirming COA Decision ruling that
petitioner is personally and solidarily liable for the amount of P881,819.00 under Notice of Disallowance.
The Office of the Solicitor General (OSG) filed its Comment reiterating its position that petitioner should
not have been made liable for the disallowed amount since there was no substantial evidence of his
direct responsibility because he did not have any participation in the bidding that was conducted by the
PBAC, nor did he have any participation in influencing Mr. A. Quintos, Jr., the DAPTEC evaluator, to
change the evaluation results. The OSG also cites the discussion in the dissenting opinion of Justice
Sereno that the standards set in Arriola should have been observed by the COA. Respondents filed their
Comment asserting that the arguments raised by the petitioner in his motion for reconsideration do not
warrant reversal of the decision rendered by this Court. The result of the technical evaluation of the
bidders' computer units. As to the contention that petitioner's act of signing the documents for the
processing of the purchase was merely a ministerial function, respondents noted that the Certification in
the Disbursement Voucher for the payment of the computer states that "Expenses necessary, lawful and
incurred under my direct supervision." Such certification definitely involves the exercise of discretion
and is not a ministerial act.
Issues: 1. whether the COA violated its own rules and jurisprudence in the determination of overpricing;
2. whether petitioner may be ordered to reimburse the disallowed amount in the purchase of the
subject computers.
RULING: Commission on Audit; authority to determine if price is excessive; power to conduct post-audit.
The COA, under the Constitution, is empowered to examine and audit the use of funds by an agency of
the national government on a post-audit basis. For this purpose, the Constitution has provided that the
COA “shall have exclusive authority, subject to the limitations in this Article, to define the scope of its
audit and examination, establish the techniques and methods required therefor, and 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.” Candelario Verzosa Jr. v. Guillermo Carague and COA, et. al, G.R. No. 157838,
February 7, 2012. Commission on Audit; Memorandum No. 07-012; relevance of brand of an equipment
as basis for what is reasonable. The COA, under the Constitution, is empowered to examine and audit
the use of funds by an agency of the national government on a post-audit basis. For this purpose, the
Constitution has provided that the COA “shall have exclusive authority, subject to the limitations in this
Article, to define the scope of its audit and examination, establish the techniques and methods required
therefor, and promulgate accounting and auditing rules and regulations, including those for the
prevention and 227 disallowance of irregular, unnecessary, excessive, extravagant, or unconscionable
expenditures, or uses of government funds and properties.” As such, CDA’s decisions regarding
procurement of equipment for its own use, including computers and its accessories, is subject to the
COA’s auditing rules and regulations for the prevention and disallowance of irregular, unnecessary,
excessive and extravagant expenditures. Necessarily, CDA’s preferences regarding brand of its
equipment have to conform to the criteria set by the COA rules on what is reasonable price for the items
purchased. Candelario Verzosa Jr. v. Guillermo Carague and COA, et. al, G.R. No. 157838, February 7,
2012. Commission on Audit; Memorandum No. 97-012 (guidelines on evidence to support audit findings
of over-pricing). 3.1 When the price/prices of a transaction under audit is found beyond the allowable
ten percent (10%) above the prices indicated in reference price lists referred to in pa[r].2.1 as market
price indicators, the auditor shall secure additional evidence to firm-up the initial audit finding to a
reliable degree of certainty. 3.2 To firm-up the findings to a reliable degree of certainty, initial findings of
over-pricing based on market price indicators mentioned in pa[r]. 2.1 above have to be supported with
canvass sheets and/or price quotations indicating: a) the identities/names of the suppliers or sellers; b)
the availability of stock sufficient in quantity to meet the requirements of the procuring agency; c) the
specifications of the items which should match those involved in the finding of over-pricing; and d) the
purchase/contract terms and conditions which should be the same as those of the questioned
transaction. Candelario Verzosa Jr. v. Guillermo Carague and COA, et. al, G.R. No. 157838, February 7,
2012. Commission on Audit; Memorandum No. 97-012; no retroactive effect. In Arriola v. COA, this
Court ruled that the disallowance made by the COA was not sufficiently supported by evidence, as it was
based on undocumented claims. The documents that were used as basis of the COA Decision were not
shown to petitioners therein despite their repeated demands to see them; they were denied access to
the actual canvass sheets or price quotations from accredited suppliers. Absent due process and
evidence to support COA’s disallowance, COA’s ruling on petitioners’ liability has no basis. We
categorically ruled in Nava v. Palattao that neither Arriola nor the COA Memorandum No. 97-012 can be
given any retroactive effect. Thus, although Arriolawas already promulgated at the time, it is not correct
to say that the COA in this case violated the afore-quoted guidelines which have not yet been issued at
the time the audit was conducted in 1993. Candelario Verzosa Jr. v. Guillermo Carague and COA, et. al,
G.R. No. 157838, February 7, 2012.