COA auditor urges strict rules for confidential funds

Former Commission on Audit (COA) state auditor Roderick Wamil testifies as a prosecution witness before the Senate Impeachment Court at the Senate of the Philippines in Pasay City on Monday, August 3. (Lino Santos)

Confidential funds must be subject to strict accounting and auditing rules because they involve public money and are vulnerable to misuse, Commission on Audit (COA) auditor Roderick Wamil told the Senate Impeachment Court on Monday.

Wamil, now an Attorney IV and audit team leader at the COA Pasay office, testified as a House prosecution witness under Article I in the trial of Vice President Sara Duterte.

He previously served with COA’s Intelligence and Confidential Fund Audit Office (ICFAO), where he audited the confidential fund liquidations of the Office of the Vice President (OVP) and the Department of Education (DepEd).

“We follow strict compliance because public funds are involved. Accounting and auditing rules must be strictly observed to prevent the misuse of funds,” Wamil said.

Explaining the role of the Commission on Audit’s Intelligence and Confidential Fund Audit Office (ICFAO), Wamil told House private prosecutor Lorna Kapunan: “The audit conducted by the COA-ICFAO is a compliance post-audit.”

He said a post-audit is conducted after funds have been disbursed to determine whether expenditures are supported by the documents required under applicable laws, rules, and regulations.

“We evaluate whether disbursements are properly supported by complete documentation required under applicable rules and regulations, and whether they are not illegal, irregular, or improper,” Wamil testified.

Wamil, who has been with COA for more than 11 years, served at the ICFAO from September 2014 to February 2024.

He identified Joint Circular No. 2015-01 as the primary standard used by the ICFAO in auditing confidential and intelligence funds.

The circular was jointly issued by the COA, the Departments of Budget and Management, Interior and Local Government, and National Defense, and the Governance Commission for Government-Owned or Controlled Corporations.

According to the circular, the confidential nature of the funds requires strong internal controls and strict accounting and auditing procedures to prevent misuse.

Asked whether the rules require substantial or strict compliance, Wamil replied: “Strict compliance po, ma’am.”

He said Section 4.8 of the circular limits confidential fund expenditures to specific purposes, including purchasing information related to national security and peace and order, renting vehicles for confidential operations, maintaining safe houses, acquiring supplies and equipment for confidential activities, and paying qualified rewards to non-employee informers under prescribed conditions.

“The first allowable expense is the purchase of information necessary for the formulation and implementation of programs, activities, and projects related to national security and peace and order,” Wamil said.

He added that rewards to informers require approval from the agency head, documentary proof of successful information-gathering or surveillance, and a direct link to a specific confidential activity.

Wamil also cited Section 4.11, which prohibits the use of confidential funds for salaries, wages, overtime pay, additional compensation, allowances, and fringe benefits unless authorized by law.

The provision also bars spending on representation, consultancy, entertainment, and the construction or acquisition of buildings or housing structures.

The prosecution presented Wamil to identify and authenticate audit records covering ₱500 million in OVP confidential funds from the fourth quarter of 2022 to the third quarter of 2023, and ₱112.5 million in DepEd confidential funds for the first three quarters of 2023. — Maricel V. Cruz