Coa Presentation

SETTLEMENT OF ACCOUNTS
RRSA
and
Pertinent Provisions
under the 2009 RRPC
Resource Person:
Atty. LITO Q. MARTIN
Director III
Commission on Audit
SESSION OBJECTIVE
To
orient AGAP convention

participants on the provisions
of COA Circular No. 2009-006
dated September 15,2009 on
RRSA & 2009 RRPC which is
effective October 28, 2009.
BACKGROUND/Previous
Issuances
COA
Circular 81-156
Restating the Requirements

for the Use of the CSB and
Providing Guidelines on Its
Issuance Including the
Accounting Treatment Thereof
Previous Issuances
COA
Circular 85-156B
Prescribing the Use of the
Manual on CSB
COA
Circular 94-001
Prescribing the Use of the
1993 Revised Manual on CSB
Previous Issuances
COA
Memorandum 2002-053
Guidelines on the Delineation of
Auditing and Adjudication Functions
COA Resolution 2006-001, 1/31/06
Responsibility to Issue NS/ND/NC
Arising From the Settlement of
Accounts and Audit of Transactions
Chapter I -
Introduction
Section 1. Title
The set of rules shall be

known as the
RRSA
Sec. 2 - Legal Authority
1.
Power/authority/duty to examine/
audit/settle all accounts

pertaining to revenues & receipts
of & expenditures or uses of
funds, owned or held in trust by,
or pertaining to the Govt. [Sec. 2
(1), Art. IX-D, Constitution]
Legal Authority [Sec. 2 (2), Art. IX-D)

2.
3.
4.
Exclusive authority to define the

scope of its audit & examination;
Establish the techniques & methods
required therefore;
Promulgate accounting & auditing
rules & regulations, including those
for the prevention & disallowance of
IEEUU expenditures, or uses of
govt. funds & property.
Other Legal Authority
5.
To certify the balances in the

accounts of AOs (Sec. 81, PD 1445)
6.
To notify in writing the officer whose

accounts have been audited & settled
(Sec. 82, PD 1445)
7.
To render accounts by local auditors

(Sec. 347, RA 7160)
Sec. 3 - Scope of RRSA
All
accounts audited pertaining

to revenues & receipts of &
expenditures or uses of govt.
funds
Settlement
of property
accounts not covered.
Chapter II General Principles, Rules and

Regulations
Settlement of
Accounts
is the process of determining

the balance of the account of an
AO, thru an audit, to determine
the transactions that may be
allowed or not allowed.
The balance refers to total
suspensions, disallowances &
charges (SDC) which shall be
his accountability.
Settlement of Accounts
Audit shall be done in

accordance with LRR
(laws/rules/regulations)
& standards to determine
whether transactions may
be allowed, suspended,
disallowed or charged.
When to issue an
AOM
1.
2.
audit decision cannot yet be

made due to incomplete
documentation or
information;
the deficiencies noted refers to
financial/operational matters w/c
do not involved pecuniary loss.
Auditors Adverse
Decisions
1.
Suspension of a transaction that

needs more requirements, & w/c
may result in pecuniary loss to
the govt., until such requirements
are complied with.
A NS shall be issued indicating
the requirements to be complied
w/ by the officers concerned.
Sec. 4. Definition
Suspension is a temporary
disallowance of a transaction w/c
appear illegal, improper or irregular
unless satisfactorily
explained/justified by the responsible
officers or until the requirements on
matters raised in the course of audit
are submitted or complied with
Sec. 4, Rule IV of RRPC
NS may be issued for

transactions of doubtful
legality/ validity/propriety to
obtain further explanation
or documentation.
Auditors Adverse Decisions
2.
Disallowance of a
transaction on
expenditure, either in
whole or in part, for being
an IIEEUU. A ND is issued
for the disallowed amount
Auditors Adverse Decisions
3.
Charge of a transaction when

the correct amount of
revenue/receipt due the govt.
is not received as a result of
under-appraisal/ assessment/
collection. A NC is issued for
the uncollected amount
Evidence of
Audit
By appropriate markings in the
documents audited
If allowed in audit, indicate
Allowed in Audit.
If not allowed, issue NS/ND/NC,
& indicate amount suspended/
disallowed/ charged in the
documents audited.
Suggested Post-Audit Stamp
POST-AUDITED
Transaction Amount
Allowed
Disallowed/Charged/
Suspended
ND/NC/NS Number
Dated
: __________
: __________
Audited by: (ATL) _________
Date: ___________
: ___________
: ___________
: ___________
Standard size is _ by __ cms

Auditor sign using RED ink
How Notices are Settled

NS - by persons responsible thru
compliance w/ requirements
ND/NC - by persons liable thru
payment, restitution or by
other modes of extinguishment
of obligation, such as
compensation, dation in payment,
condonation.
Notice of Settlement
The
auditor issue
an NSSDC for
settled NS/ND/NC
Balance of Account
The auditor shall issue :
SASDC within 15 days after

the end of each QTR;
Updated list of outstanding
SDC within 5 days from receipt
of request by a retiring/
transferring officer.
Linkages to the AAR

Total unsettled SDC at the
end of CY as reflected in the
4th QTR SASDC shall be
reported in the AAR
Other deficiencies noted as
indicated in the AOM shall be
included in Part II of the AAR
Responsibilities for
Audit and Settlement
of Accounts
Responsibilities of
Agency Head
Primarily responsible for

all govt. funds & property
pertaining to his agency.
Fiscal responsibility rests

directly with him.
Responsibilities of Agency Head
Ensure that:
1)
a)
b)
Required financial/other reports/

statements are submitted by the
concerned agency officials in
prescribed form and within the
prescribed period;
Settlement of disallowances/ charges
is made within the prescribed period;
Requirements of
transactions suspended
are complied with;
d) Appropriate actions are
taken on the deficiencies
noted as contained in the
AOM.
c)
Responsibilities of Agency
Head
2)
Initiate the necessary

administrative and/or
criminal action in case of
unjustified failure/refusal to
effect compliance with the
foregoing requirements by
subordinate officials.
Gross negligence in
disciplining subordinates who
are the subject of repeated
adverse audit findings shall
subject him to disciplinary
action by proper authorities.
3)
4)
Enforce the COE by requiring

the withholding of salaries/other
compensation due the person
liable in satisfaction of the
disallowance/charge.
Ensure that all employees who
are retiring/transferring shall first
settle the disallowances &
charges for w/c they are liable.
Responsibilities of Agency
Accountants/Bookkeepers
1.
Ensure that reports &

supporting documents
submitted by the AOs are
immediately recorded &
submitted to the Auditor
w/in 1st 10 days of the
ensuing month;
Responsibilities of Accountants
2. Ensure
that financial
records are made
accessible at
reasonable hours to the
auditors when needed;
Powers & functions of

Auditors
(Sec. 3, Rule II of RRPC)
To exercise such powers &

functions as provided by law & as
may be authorized by COA in the
audit & settlement of the accounts,
funds, financial transactions &
resources of the agencies under
their respective audit jurisdiction.
Role of Auditors
(Sec. 2, Rule IV of RRPC)
To maintain complete independence

& exercise professional care & be
guided by applicable LRR & the
GAAAP in the performance of audit
work & preparation audit reports.
Responsibilities of Auditors
(Sec. 3, Rule IV of RRPC)
To obtain sufficient evidence to

provide an appropriate factual
bases for his opinions, conclusions,
judgments & recommendations;
To safeguard this evidence to
support his findings, which may
include physical, testimonial,
documentary, analytical &
electronic evidences.
Responsibilities of
Auditor
(Sec. 7.3 of RRSA)
1.
Enforce submission of
prescribed/ necessary
reports of receipts/
disbursements w/ all paid
vouchers, ORs, &
supporting documents;
Responsibilities of Auditor
2.
3.
Conduct audit on the

above-submitted documents
covering transactions under
the identified audit areas;
Prepare, as a result of
audit, the pertinent
NS/ND/NC/AOM/NFD;
4.
5.
Prepare the COE for

disallowances/charges issued by
him for his Directors signature
Serve the NS/ND/NC/
AOM/NFD/COE to persons
concerned/responsible/liable;
6.
7.
Monitor the enforcement of

COE issued & report to Director
the action taken by the agency
thereon pursuant to Sec. 24;
Issue the NSSDC when there
is settlement pursuant to Sec. 13;
Responsibilities of
Auditor
8.
Prepare & transmit

SASDC to the agency
head & the Accountant
pursuant to Sec. 14;
9.
Others
Responsibilities of
Director
1. Exercise general supervision
& review in audit &
settlement of accounts;
2. Act on appeals pursuant to
Sec. 18;
3. Sign the NFD for decisions
rendered pursuant to Sec. 22;
Responsibilities of Director
4.
Sign the COE for decisions

rendered by him & by the
Auditor pursuant to Sec. 23;
5.
Consolidate the SASDC for all

auditees under his jurisdiction;
Payment of Filing Fees

2009 RRPC
Every petition/appeal filed before an

adjudicating body/office of COA
pertaining to the following cases shall
be imposed a filing fee equivalent to
1/10 of 1% (0.1%) of the amount
involved, but not exceeding P10,000.
Filing Fees
a)
b)
c)
d)
Appeal from audit disallowance/charge

Appeal from disapproval of request for relief
from accountability
Money claims, except if the claimant is a
govt. agency
Request for condonation of settled claim or
liability except if between govt. agencies
Legal Research Fund
(Section 4, RA 3870, as amended, & LOI

1183 dated Dec. 16, 1981)
In
addition, LRF of 1% of
filing fee imposed, but not
lower than P10 shall be
collected
Where to Pay Fees
At the Cashier of COA Central

Office or Regional Office
if not practicable, may be
remitted thru postal money
order payable to the
Commission on Audit
Payment of Fees
OR
shall be attached to
the pleading
If no OR, adjudicating
bodies/offices shall not
take action thereon
Chapter III
Guidelines in issuance
of AOM/NS/ND/NC
and SASDC
Sec. 8 AOM & Management Reply
1.
The Auditor shall issue an AOM

(Form 1) for observation relating to
financial/operational deficiencies such
as accounting, internal control or
property management which do not
involve pecuniary loss, including for
documentary or other information
requirements to enable the auditor to
make a decision in audit.
Sec. 8 - AOM & Mngt. Reply
2.
3.
AOM is addressed to agency head

and officers concerned stating the
deficiencies noted and/or
requirements to be complied with
and requiring a response thereon.
Signed both by the ATL and SA.
AOM shall be replied to by agency
officials concerned w/in 15 CDs from
receipt thereof.
Sec. 8 - AOM and Management Reply
4.
If agency officials failed to reply, the

observation shall be deemed accepted
and shall be included in the audit report
(ML and/or AAR). In case of failure to
submit documents/ information needed
to reach an audit decision, an NS/ND/NC
may be issued after a re-evaluation of
those available.
Sec. 8 - AOM & Mngt. Reply
5.
6.
The Auditor shall evaluate the agencys

reply/comments and shall inform the
agency head and officer concerned in
writing of the results of evaluation.
The documents/information submitted
in response to an AOM may provide
basis for the allowance, SDC in audit.
Sec. 9 Notice of Suspension
1.
The Auditor may issue an NS

(Form 2) for transactions of
doubtful legality/propriety/
regularity which may result in
pecuniary loss of the
government to obtain further
explanation or documentation.
2.
Addressed to agency head and the

Accountant; served on the persons
responsible; stated the amount
suspended, the reason/s for
suspensions, the justification/
explanation/legal basis/documents
needed to lift the suspension, and the
persons responsible for compliance.
3.
4.
Issued as often as suspensions are made

Suspension shall be settled within 90
CDs from date of receipt by the
responsible officers; otherwise, the
transaction shall be disallowed/ charged
after the Auditor shall had satisfied
himself of such action and consequently,
issue the ND/NC.
Sec. 10 Notice of Disallowance
1.
The Auditor shall issue an ND (Form 3)

for transactions w/c are IEEU (COA Circ.
85-55A) and illegal (contrary to law) and
unconscionable (unreasonable and
immoderate; no man in his right sense
would make, nor fair and honest man
would accept as reasonable; and those
incurred in violation of ethical and moral
standards)
2.

Accountant; served on the persons
liable; indicated the transaction
and amount disallowed, the
reasons for disallowance, the LRR
violated, and the persons liable.
3.
4.
Issued as often as
disallowances are made.
Disallowances shall be
settled within 6 months
from date of receipt by the
persons liable.
Sec. 11 Notice of Charge (NC)
1.
The Auditor shall issue the NC (Form 4)

on the difference of the following, which
are proper audit charge:
a)
b)
c)
Amount assessed/appraised is less than what

is due;
Amount billed is less than what is due;
Amount collected is less than what is due.
Sec. 11 Notice of Charge
2.

Accountant; served on the persons liable;
indicated the transaction and amount
charged, the reasons for the charge, the
LRR violated, and the persons liable.
Sec. 11 Notice of Charge
3.
4.
Issued as often as charges are

made.
Charge shall be settled within 6
months from date of receipt
by the persons liable.
ND/NC
ND/NC shall be adequately

established by evidence and the
conclusion, recommendations or
dispositions shall be supported by
applicable LRR, jurisprudence and
the GAAAP.
ND/NC/NS/decisions/other orders
Shall
be prepared in such number of

copies as may be necessary for:
1) head of audited agency (original);
2) Auditor for record (duplicate);
ND/NC/NS/decisions/other orders
3) agency officials directly

affected by the decision and
from whom specified
action/response is expected.
Sec. 12 Service of Copies of

ND/NS/NC
1.
To each persons liable/responsible, by the

Auditor, thru personal service. If not
practicable, by registered mail. If several
payees, such as disallowed payroll, service to
the Accountant, who shall be responsible for
informing all payees concerned, constitute
constructive service to all payees in the payroll.
Sec. 12 Service of Copies
Personal service by:

a) delivering personally to the
party,
b) leaving in his office w/ his clerk or
with a person having charge thereof.
2.
c) by leaving at the partys

residence between 8 AM to 6 PM,
with a person of sufficient age and
discretion then residing thereon.
3.
Register mail by a) sending to the

office address of the party, if
known; otherwise, b) at his residence
with instruction to the Postmaster to
return the mail to sender after 10
days, if undelivered. Ordinary mail, if
no service is available in locality of
either sender or addressee.
4.
Record of date of actual or constructive

service for purpose of determining the
running of 90 days maturity period of the
suspension & the 6 months period to
appeal the disallowance/charges. These
information shall be included in the Record of
COA Decisions (ROCD)
Sec. 13 NSSDC
1.
2.
The Auditor shall issue the NSSDC (Form 5)

whenever a SDC is settled.
Accountant; copy furnished the persons
responsible/liable; indicated the NS/ND/NC
settled, amount, nature of transaction and
mode of settlement. Signed both by the ATL
and SA.
Responsibility of Auditor . . .
.
Under Section 7.3
Auditor shall issue a Notice of

Finality of Decision (NFD) to inform
the agency head that a decision of COA or
its authorized representative has become
final & executory, which shall be the basis
for recording the disallowance/charge in
the agencys books.
Sec. 13 NSSDC
3.
Settlements a)
Suspension by submission of
justification/explanation and/or
documentation required and after the
Auditor is satisfied that the transaction
is regular/legal/proper. If the Auditor is
not satisfied, he shall issue the ND/NC;
Sec. 13 Settlement
Disallowance/charge
i) by payment of the amount disallowed;
ii) by such other applicable modes of
extinguishment of obligation as
provided by law, w/c the Auditor may
refer to the General Counsel, for
evaluation & advice, the propriety of
the settlement;
b)
Sec. 13 Settlement
b)
Disallowance/charge
iii) from a decision of the Director, the

ASB, or the CP, lifting the same.
Sec. 14 SASDC
1.
The Auditor shall prepare the SASDC (Form

6) summarizing the total SDC for the current
period. It shall indicate beginning balance for
each NS/ND/NC, the NS/ND/NC and NSSDC
for the period and the ending balance of the
NS/ND/NC. Signed both by the ATL and SA.
Sec. 14 SASDC
2.
3.
Issued to agency head & the

Accountant within 15 CDs from the
end of each QTR, copy furnished the
COA Director concerned.
The Auditors SASDC shall be the
basis for the preparation by the
Directors consolidated quarterly
SASDC for his cluster/region showing
the total unsettled SDC per auditee.
Sec. 14 SASDC
4.
The Sector Ascom shall be furnished

copy of the consolidated SASDC of
each cluster/region for purpose of
national consolidation into a Sector
SASDC as an input into a database to
be maintained by the ITO showing
the total unsettled SDC per Sector.
Liable for Audit

Disallowances/Charges
Determined on the basis of:

a) nature of disallowance/charge;
b) duties/responsibilities or obligations
of officers/employees concerned;
c) extent of participation in the
transaction;
d) amount of damage or loss to the
govt.; (Sec. 16.1)
1.
Liability of Public Officers (POs)
a)
Custodians of government funds

are liable for failure to ensure that
funds are safely guarded against
loss or damage; expended, utilized,
disposed of or transferred in
accordance w/ LRR; and on the
basis of prescribed documents and
necessary records.
Liability of POs
b)
Who certify as to the

necessity, legality and
availability of funds or
adequacy of documents
are liable according to their
respective certifications.
Liability of POs
c)
Who approve or authorize

expenditures are liable for
losses arising out of their
negligence or failure to
exercise the diligence of a
good father of a family.
Liability of POs & Other

Persons
d)
Who confederated or
conspired in a transaction
which is disadvantageous or
prejudicial to the
government are liable jointly
and severally w/ those who
benefited therefrom.
Liability of the PAYEE

e)
Personally liable for a

disallowance where the ground
thereof is his failure to submit
the required documents, and
the Auditor is convinced that
the disallowed transaction did
not occur or has no basis in
fact.
Liability for Audit

Charges
2.
Measured by the individual

participation and involvement
of POs whose duties require
appraisal/assessment/
collection of govt. revenues &
receipts in the charged
transaction. (Sec. 16.2)
Liability of persons determined

to be liable under an ND/NC
3.
Solidary. COA may go

against any person
liable without prejudice
to the latters claim
against the rest of the
persons liable.
DECISIONS AND
APPEALS
WHOSE
JURISDICTION/
APPROVING
OFFICIAL
WHAT CASES
FILING FEE
REQUIRED
Request for write-off of

unliquidated cash
advances and dormant
accounts receivables
-
not exceeding P1 M
- exceeding P1 M
- ASB (original)
-
CP (original)
- None
-
None
DECISIONS AND
APPEALS
WHAT CASES
for relief from cash
and property
accountabilities
WHOSE
JURISDICTION/ FILING FEE
REQUIRED
APPROVING
OFFICIAL
Request
not exceeding P100,000

[fortuitous events and
natural calamities or acts of
man (theft, robbery, arson)]
- Auditor
(original)
Director
exceeding
P100,000
for (original)
losses due to fortuitous
event or natural calamities
(no limit)
-
None
None
DECISIONS AND
APPEALS
WHAT CASES
WHOSE
JURISDICTION/
APPROVING
OFFICIAL
FILING FEE
REQUIRED
Request
for relief from cash

and property
accountabilities
-
exceeding P100,000 but not

more than P500,000 for acts
of man
- Director
(original)
- None
- None
exceeding P500,000 but not

more than P5M (for acts of
man)
- ASB (original)
exceeding P5M (for acts of

man)
- CP (original)
- None
DECISIONS AND APPEALS

WHAT CASES
for COAs
concurrence on the hiring
of legal consultants and
appeals/Motion for
Reconsiderations thereto
WHOSE
JURISDICTION/
APPROVING
OFFICIAL
FILING FEE
REQUIRED
Request
- CP (exclusive)
- None
Appeals
from audit disallowance/charge

involving
amounts:
- Director
(appellate)
- 1/10 of 1% but
not
less than P10
but
not to exceed
P10,000
- not exceeding P1,000,000
- ASB (appellate)
- exceeding P1,000,000
- CP (appellate)
- Do -
Do -
DECISIONS AND
APPEALS
WHAT CASES
Appeals from
disapproved request for
relief from accountability
- for acts of God (no limit)
WHOSE
JURISDICTION/
APPROVING
OFFICIAL
- 1/10 of 1% but
not
less than P10
but
not to exceed
- ASB (appellate) P10,000
- ASB (appellate)
- for acts of man exceeding

P100,000 but not more
- CP (appellate)
than P500,000
- For acts of man
exceeding P500,000
FILING FEE
REQUIRED
- Do - Do -
- Do -
DECISIONS AND
APPEALS
WHAT CASES
Money claims, except if
claimant is a government
agency (regardless of
amount)
Request for condonation of
settled claims or liability
except if between
government agencies
Approval of private sale of
government property in
WHOSE
JURISDICTION/
APPROVING
OFFICIAL
- CP (original)
- CP (original)
FILING FEE
REQUIRED
- 1/10 of 1% but
not
less than P10
but
not to exceed
P10,000
- Do -
- CP (original)
- Do -
LEVEL OF APPEALS
Director
ASB
CP
Sec. 17 Period to Appeal

Any
person aggrieved may within 6

months from receipt of ND/NC appeal in
writing;
If not appealed within the prescribed
period shall become final & executory;
Filing of an appeal will suspend the
running of the prescribed period;
Running of 6 month period shall resume
upon receipt of a decision from the
Director or the ASB.
Proceedings before the

Director
1)
An aggrieved party may file an

Appeal Memorandum (AM) from
an Auditors Decision/ND/
NC to the Director concerned,
copy furnished the Auditor,
within 6 months from receipt of
Decision/ND/NC;

Director
2.
Caption
Appellant - party
appealing
Appellee - Auditor who
rendered the decision

Director
3)
The receipt by the Director of

the AM shall stop the running
of the period to appeal which
shall resume to run upon
receipt by the appellant of the
Directors decision.

Director
4)
Within 5 CDs from receipt of the

AM, the Director shall order the
Auditor to submit his Answer, copy
furnished the appellant, together
with the entire records of the case
including the EDSE, duly numbered
at the bottom of each page.

Director
5)
The Auditor shall comply w/

the Directors Order
within 15 CDs from receipt.
The appellant may file a
Reply within the same
period from receipt of the
Answer.

Director
6)
The Director shall decide

the Appeal within 15 CDs
from receipt of the complete
documents necessary for
evaluation & decision.

Director
7)
The Director may affirm the decision of

the Auditor; If he reverses, modifies
or alters, the case shall be elevated
directly to the CP for automatic
review of the Directors Decision.
The dispositive portion shall
categorically state that the decision is
not final & is subject to automatic
review of the CP.

Director
8)
The Director shall not

entertain a motion
for reconsideration
(MR) of his decision.
Sec. 19 Proceedings before the

ASB
1)
Any person aggrieved by a

Directors Decision involving
an amount not exceeding
P1 Million may appeal to
the ASB within the time
remaining of the 6 months
period to appeal.
Sec. 19 Proceedings before

the ASB
2)
Upon receipt of the AM, the ASB,

thru the Ascom of LSS, shall
require the Director to submit an
Answer, copy furnished the
Appellant, together w/ the entire
records of the case including the
EDSE, duly numbered at the
bottom of each page.

the ASB
3)
The Director shall comply w/ the

ASBs Order within 15 CDs
from receipt. The appellant may
file a Reply within the same
period from receipt of the
Answer.

the ASB
4)
The ASB shall decide the

Appeal within 15 CDs
from receipt of the
complete documents
necessary for evaluation
& decision.

ASB
5)
The ASB may affirm,

reverse, modify or alter
the Directors Decision.
6)
The ASB shall not entertain

an MR of its Decision.

CP
1)
The party aggrieved by a

decision of the Director or
the ASB may appeal to the
CP by filing a Petition for
Review.

CP
2)
A party aggrieved by a Directors

Decision involving ND/NC exceeding P1
Million may file an appeal to the CP
within the time remaining of the 6
months period taking into
consideration the suspension of the
running thereof.
3) The CP shall decide within 60 CDs from

the date of its submission for decision
or resolution.

CP
4) A case is deemed submitted for
decision/resolution upon the filing of
last pleading/brief/memorandum
required by COA rules.
5) If the account/claim involved in the
case needs reference to other
persons, office, or party interested,
the period shall be counted from
the time the last comment necessary
to a proper decision is received by it.
Automatic Review of Directors

Decision
a)
The CP shall within 60 CDs

from receipt of the Directors
Decision & the entire
records of the case, review
the same & render its own
decision.
MR of CP Decision
a)
Only one MR shall be

entertained on the basis of
new & material evidence, or
that the evidence is insufficient
to justify the decision, or the
said decision is contrary to law.
b) The MR shall be filed within

the remaining of the 6 months
period to appeal.
Appeal to the SC
1)
The party aggrieved may appeal

the CPs decision/order/ruling within
30 days from his receipt, appeal on
Certiorari to the SC in the manner
provided by law & Rules of Court.
2)
When the CPs decision/order/ruling

adversely affects the interest of any
govt. agency, the appeal may be
taken by the agency head.
LACHES
Defined as the failure or neglect, for an

unreasonable length of time, to do that by which
by exercising due diligence could or should have
been done earlier.
It is negligence or omission to assert a right within a

reasonable time, warranting a presumption that the
party entitled to assert it either has abandoned it or
declined to assert it.
Relief has been denied to litigants who, by sleeping

on their rights for an unreasonable length of time
either by negligence, folly or inattention have
allowed their claims to become stale. The laws aid
the vigilant, not those who slumber on their rights.
ELEMENTS OF LACHES
Conduct on the part of the defendant
that gave rise to the situation
complained of; or the conduct of
another which the defendant claims
gave rise to the same;
2. Delay by the complainant in asserting
his right after he has had knowledge
of the defendants conduct and after
he has had an opportunity to sue;
1.
ELEMENTS OF LACHES
3. Lack of knowledge by or notice
to the defendant that the
complainant will assert the right
on which he bases his suit; and
4. Injury or prejudice to the
defendant in the event relief is
accorded to the complainant.
SUPREME COURT RULING:
Soliva vs. Intestate Estate of Marcelo M.

Villaliba, G.R. No. 154017, Dec. 8, 2008
even a registered owner of property may
be barred from recovering possession of
property by virtue of laches
The same is not true with regard to
laches.
stale demand.
TEOTIMO EDUARTE vs. CA, G.R.

No. 121038, July 22, 1999
It has been consistently held that laches

does not concern itself with the character of
the defendants title, but only with the issue
of whether or not the plaintiff by reason of
long inaction or inexcusable neglect
should be barred entirely from asserting the
claim, because to allow such action would
be inequitable and unjust to the defendant.
(underscoring and emphasis ours)
EXCEPTION TO THE GENERAL RULE:
Durban Apartments Corp. vs. Catacutan, G.R. No. 167136, Dec 14, 2005
the Court may disregard procedural

lapses so that a case may be resolved on
its merits. Rules of Procedure should
promote, not defeat, substantial justice.
A strict and rigid application of the rules that
would result in technicalities that tend to
frustrate rather than promote justice must
be avoided.
CANDO vs. Olazo, G.R. No.

160741, March 22, 2007
Ultimately,
the interest of substantial

justice must transcend rigid
observance of the rules of
procedure.xxx
Department of Agrarian Reform

vs. Ma. Regina I. Samson, et al.,
G.R. 161910, June 17, 2008
It is well-settled that rules

of procedure are construed
liberally in proceedings
before administrative
bodies and are not to be
applied in a very rigid and
technical manner, .
Finality and
Enforcement
of Decisions
EXECUTION OF DECISION
Execution shall issue upon a

decision that finally disposes of
the case. Such execution shall
issue as a matter of right upon the
expiration of the period to appeal
there from if no appeal has been
fully perfected. (Section 1 Rule
XIII, Revised Rules of Procedure)
Finality and
Enforcement of Decisions
Notice of
Finality of
Decisions
a)
NOTICE OF FINALITY OF DECISION

(NFD)
1)
A decision of the CP, ASB, Director or

Auditor upon any matter within their
respective jurisdiction, if not appealed,
shall become final & executory.
2)
The NFD (Form 7) shall be issued by the

authorized COA official to agency head to
notify that a decision has become final &
executory, there being no appeal or MR
filed within the reglementary period.
NOTICE OF FINALITY OF DECISION (NFD)

Republic of the Philippines
COMMISSION ON AUDIT
JKL City, Manila
Date: December 12, 2009
NOTICE OF FINALITY OF DECISION (NFD)
Hon. Lito M. Paras
City Mayor
JKL City, Metro Manila
Attention: Mr. Lauro T. Lorenzo
City Accountant
Reference: ND/NC No.
Date of NC
Amount
- _________________
- _________________
- _________________
Nature of ND/NC
- Collection of City License tax in the amount of P63,189.00 which was deficient by P2,700.00 since
correct amount should be P65,889.00.
the
Persons Liable and date

1. Edna P. Gamba Assessment Clerk II
- ______________
of receipt of ND/NC 2. Joseph R. Santos Chief, License Division - ______________
3. ABC Enterprise payor
- ______________
Please be informed that the above ND/NC has become final and executory, there being no appeal filed within the reglementary period.
Accordingly, the above named persons liable shall pay the above amount immediately to the agency cashier. Failure to pay the same shall authorize the agency cashier to
withhold payment of salary and other money due to persons liable in accordance with COA Order of Execution to be issued to the agency cashier.
Carlito G. Odullo
CARLITO G. ODULLO
Audit Team Leader
Supervising Auditor
Gina H. Landicho
GINA H. LANDICHO
PROOF OF SERVICE OF NFD TO PERSONS LIABLE

Name
Position
Received by Date
1. Edna P. Gamba _______________
_____________
___________
2. Joseph R. Santos
_______________
_____________
___________
3. ABC Enterprise _______________
_____________
___________
Copy furnished:
The Director
Local Government Sector
If
decision of the Director/ASB or CP attains

finality, par 1 may be restated as follows:
Please be informed that the decision of the

Director/
Adjudication
and
Settlement
Board/Commission Proper No. __________ dated
_________ has become final and executory in the
absence of
an appeal filed within the
prescribed period. The said decision affirmed
the above ND/NC.
(Signatory shall be the Director, General
Counsel or Commission Secretary as provided
under Section 22.3 of these Rules. A copy of
the CFD issued by the Commission Secretary
shall be furnished the General Counsel)

(NFD)
3)
Signing Authority:
4)
ATL & SA for their ND/NC;

Director for ND/NC issued by SAT under his
supervision;
Director for his decision;
General Counsel for ASB decision;
Commission Secretary for CP decision
Addressed to the Agency Head, Attention: the

Chief Accountant & shall indicate the
particulars of the COA decision that has
become final & executory & the persons liable.

(NFD)
5)
A copy shall be served by the Agency

Auditor on the persons liable or their
authorized representatives who shall
indicate their printed name & signature
& the date of receipt.
6)
The Chief Accountant shall, on the basis

of
the
NFD,
record
the
disallowance/charge as a receivable.
Finality and
Enforcement of Decisions
b)
COAs Order of
Execution
COA Order of Execution (COE)
COE (Form 8) is issued to

enforce the settlement of
disallowance/charge,
whenever
the
persons
liable refuse or fail to settle
them after the decision
become final & executory.

Republic of the Philippines
COMMISSION ON AUDIT
Office of the General Counsel
Date: July 20, 2010
COA ORDER OF EXECUTION (COE)
Mr. Romeo Formoso
President, GHI Corp.
Roxas Blvd., Manila
Attention: Ms. Erlinda Manrique
Cashier
Reference: CP/ASB Decision No. & date
- 2009-023 dated March 10, 2009
ND No. & date
- 06-051-101-05 dated July 14, 2006
Amount
- P42,000.00
Date of NFD
- July 5, 2008
Nature of transaction
- Payment for sports equipment under DV No. 03- 07-25 dated 5/28/2006 in the total amount of P142,826.00
Persons Liable
1. Jose L. Unciano Property Inspector
- ___________
2. Gloria G. Manalili Chief, General Services - ___________
3. Sandra P. Baylon Chief, Research Division - ___________
You are hereby instructed to withhold the payment of the salaries or any amount due to the above-named persons liable, for the settlement of their liabilities pursuant to the ND/Decision referred to above,
copy attached and made an integral part hereof.
Payment of salaries or any money due them in violation of this instruction will be disallowed in audit and you will be held liable therefore.
Wilma C. Jardin
WILMA C. JARDIN
Assistant Commissioner
General Counsel
Name
1. Mr. Romeo Formoso President, GHI Corp.
2. Ms. Erlinda Manrique
Position
_____________
Cashier
Copy furnished:
Persons liable:
Mr. Jose L. Unciano
Ms. Gloria G. Manalili
Ms. Sandra P. Baylon
All of GHI Corp., Manila
The Accountant
GHI Corp.
The Auditor
GHI Corporation, Manila
The Director, Cluster C
Corporate Government Sector
PROOF OF SERVICE OF COE TO AGENCY OFFICIALS

Received by
_______________
_____________
Date
_______________
COE shall be approved not earlier than

5 days from receipt of the NFD by the
agency head, by the following:
Director for NFD issued by him or by the

Auditor;
General Counsel for NFD issued by him

or by the Commission Secretariat, or for
judgment rendered by the SC
Addressed
to the agency head,

Attention: the Cashier/ Treasurer,
& shall indicate the NFD, the
particulars of the decision being
enforced & the persons liable.
The
Auditor
monitor
the
implementation of the COE &
report to the Director the action
taken by the agency. Unsettled
COEs shall be referred to the GC
for appropriate action, including
referral to the OSG & the
Ombudsman.
Non-Compliance with the

COE
Section 3. Non-compliance with the COE. - In case of
failure by the Cashier/Treasurer/Disbursing Officer to
comply with the COE, the Auditor shall notify the
agency head concerned of the non-compliance. At the
same time, the Auditor shall report the matter through
the COA Director concerned, to the General Counsel
who shall take any or all of the following actions:
Recommend to the Commission Proper to cite

defaulting party in contempt;
Refer the matter to the Solicitor General for the filing
of appropriate civil suit;
Refer the case to the Ombudsman for the filing of
appropriate administrative or criminal action.
Remedies for Non-Compliance with the

COE
Section 4. Holding the Defaulting Party in

Contempt. Any party who fails to comply with
the COE may be held in contempt pursuant to
Section 2, Rule XI of these Rules. The LSS shall
study and evaluate the report of such noncompliance as cited in the preceding section
and submit its recommendation to the
Commission Proper within fifteen (15) days
from receipt thereof (Section 4 Revised Rules
of Procedure)

COE
Section 1. Direct Contempt Punished Summarily. - A
person guilty of misbehavior in the presence of or so
near the Commission Proper or any of its members as
to obstruct or interrupt the proceedings before it or
them, including disrespect toward the Commission or
its members, offensive personalities toward others or
refusal to be sworn or to answer as a witness, or to
subscribe to an affidavit or deposition when lawfully
required to do so, may be summarily adjudged in
contempt by the Commission or any of its members
and shall be punished in accordance with the penalties
prescribed in the Rules of Court.(Section 1 Rule XI,
Revised Rules of Procedure)

COE
Section 2. Indirect Contempt. After a charge in writing
has been filed by an aggrieved party before the Commission
Proper or its members, and after an opportunity shall have
been given to respondent to be heard by himself or counsel,
a person guilty of the following acts may be punished for
contempt:
Misbehavior of any officer of the Commission in the performance

of his official duties or in his official transactions;
Disobedience of or resistance to a lawful writ, process, order,
judgment or command of the Commission or any of its members;
Any abuse of or any unlawful interference with the process or
proceedings of the Commission or any of its members not
constituting direct contempt under Section 1 of this rule;
Any improper conduct tending, directly or indirectly, to impede,
obstruct, or degrade the administration of justice by the
Commission or any of its members;
Failure to obey a subpoena duly served.

COE
Section
3.
Penalty
for
Indirect
Contempt.
If
adjudged guilty, the accused
may be punished in accordance
with the penalties prescribed in
the Rules of Court.(Sections 2
and 3, Revised Rules of
Procedure)

COE
Section 5. Referral to the Solicitor General. - To enforce

civil liability, the Auditor shall submit to the Director
concerned a report on COEs which have not been
complied with. The report shall be duly supported with
certified copies of the subsidiary records, and the
payrolls/vouchers disallowed and collections charged,
together with all necessary documents for the filing of
the appropriate civil suit. The Director shall forward the
report to the General Counsel who shall study and
evaluate the same and submit his recommendations to
the COA Chairman within fifteen(15) days from receipt
thereof. Referral to the Office of the Solicitor General for
its appropriate action may be made. (Section 5, Rule
XIII, Revised Rules of Procedure)

COE
Section 6. Referral to the Ombudsman. - The Auditor

shall report to his Director all instances of failure or
refusal to comply with the decisions or orders of the
Commission contemplated in the preceding sections.
The COA Director shall see to it that the report is
supported by the sworn statement of the Auditor
concerned, identifying among others, the persons
liable and describing the participation of each. He shall
then refer the matter to the Legal Services Sector who
shall refer the matter to the Office of the Ombudsman
or other appropriate office for the possible filing of
appropriate administrative or criminal action.

COE
Section 7. Effect of Noncompliance. - Any delay in
complying or refusal to comply
with the order or decision of the
Commission shall constitute a
ground for contempt, and/or
administrative disciplinary action
against the officer or employee
concerned.

COE
Section 1. Applicability of Civil Service Law

and Other Rules. - The procedures set
forth in the pertinent provisions of the
Civil Service Law, The Omnibus Rules
Implementing Executive Order 292 and
COA
Memorandum
No.
76-48,
in
administrative cases against officers and
employees of the Commission, are hereby
adopted and read into these rules.
(Section 1, Rule IV of the Revised Rules of
Procedure)
Dropping from the Books of Accounts

of Settled ND/NC
Recorded
final
disallowances/charges w/c are
settled shall be dropped from the
books upon receipt by the
Accountant of the NSSDC
(Section 24 Rules and Regulations
on the Settlement of Accounts)
Record of COA Decisions (ROCD)
1.
Maintained by the Auditor showing

the ND/NCs issued, appeals taken,
decisions on appeals, NFDs & COE
issued & the NSSDC;
2.
The Director & the LSS Ascom shall

keep copies of the Decisions
rendered
by
their
respective
offices, & the NFD & COEs;
Record of COA Decisions (ROCD)
The Director, LSS Ascom &

Commission Secretary shall
ensure that the Auditor is
furnished w/ copies of their
decisions, & NFDs & COEs, to
update the ROCD.
Opening/Revision of Settled Accounts
1.
In no case shall finally settled

accounts be opened or reviewed by
COA, except on the following before
the expiration of the 3 years after the
settlement of any account:
a)
motu propio review & revise the account

or settlement & certify a new balance. It
may require any account, voucher or
other papers connected w/ the matter be
forwarded to it.
Opening/Revision of Settled Accounts
b)
Open the account when appearing to be tainted w/

fraud, collusion, or error of calculation, or when new &
material evidence is discovered, & after a reasonable
time for reply or appearance of the party concerned,
may certify thereon a new balance. An Auditor may
exercise the same upon prior authorization of the COA
Chairman.
2. If a settled account is re-opened/

reviewed, & a new balance is certified in
accordance w/ Sec. 52 of PD 1445, the
aggrieved
party
may
appeal
in
accordance w/ Rule IV of RRSA.
As Accountants
Let us consider 3
simple rules.
1 - Do no harm
2 - Do good
3- Stay in love with
GOD
OPEN FORUM
THANK
YOU!!!

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SETTLEMENT OF ACCOUNTS

orient AGAP convention

Restating the Requirements

The set of rules shall be

Sec. 2 - Legal Authority

audit/settle all accounts

Legal Authority [Sec. 2 (2), Art. IX-D)

Exclusive authority to define the

Other Legal Authority

To certify the balances in the

To notify in writing the officer whose

To render accounts by local auditors

Sec. 3 - Scope of RRSA

accounts audited pertaining

Chapter II General Principles, Rules and

is the process of determining

Audit shall be done in

audit decision cannot yet be

Suspension of a transaction that

Sec. 4, Rule IV of RRPC

NS may be issued for

Auditors Adverse Decisions

Auditors Adverse Decisions

Charge of a transaction when

Suggested Post-Audit Stamp

Audited by: (ATL) _________

Standard size is _ by __ cms

How Notices are Settled

The auditor shall issue :

SASDC within 15 days after

Linkages to the AAR

Primarily responsible for

Fiscal responsibility rests

Responsibilities of Agency Head

Required financial/other reports/

Responsibilities of Agency Head

Initiate the necessary

Responsibilities of Agency Head

Responsibilities of Agency Head

Enforce the COE by requiring

Ensure that reports &

Powers & functions of

To exercise such powers &

(Sec. 2, Rule IV of RRPC)

To maintain complete independence

To obtain sufficient evidence to

Conduct audit on the

Prepare the COE for

Monitor the enforcement of

Prepare & transmit

Sign the COE for decisions

Consolidate the SASDC for all

Payment of Filing Fees

Every petition/appeal filed before an

Appeal from audit disallowance/charge

Legal Research Fund

(Section 4, RA 3870, as amended, & LOI

Where to Pay Fees

At the Cashier of COA Central

Sec. 8 AOM & Management Reply

The Auditor shall issue an AOM

Sec. 8 - AOM & Mngt. Reply

AOM is addressed to agency head

Sec. 8 - AOM and Management Reply