Monday, February 08, 2016

Luciano Veloso, et. al. vs. Commission on Audit (COA) [GR No. 193677, September 6, 2011]

FACTS: In 2000, the City of Manila enacted Ordinance No. 8040 authorizing the conferment of Exemplary Service Award (EPSA) to elective officials of the City who have been elected for three (3) consecutive terms in the same position. Such officials shall be given a retirement and gratuity pay remuneration equivalent to the actual time served in the position for three (3) consecutive terms. In 2006, Legal and Adjudication Office (LAO)-Local of the COA issued a Notice of Disallowance. Petitioner filed a Motion to Lift the Notice of Disallowance on the ground that LGUs have fiscal autonomy and that they have the power to grant allowances/gratuity.

ISSUE: Whether or not COA properly exercised its jurisdiction in disallowing the disbursement of the City of Manila's funds for the EPSA of its former three-term councilors

RULING: Yes. COA is vested with the authority to determine whether government entities, including LGUs, comply with laws and regulations in disbursing government funds, and to disallow illegal or irregular disbursements of these funds. LGUs, though granted local fiscal autonomy, are still within the audit jurisdiction of the COA. Moreover, COA was held correct in issuing the Notice of Disallowance because, contrary to the contention of the petitioners that the award is a form of gratuity, the recomputation of the award disclosed that it is equivalent to the total compensation received by each awardee for nine years, that includes basic salary, additional compensation. Undoubtedly, the computation of the awardees' reward is excessive and tantamount to double and additional compensation which is prohibited by law.

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