The Commission on Audit (CoA) has denied with finality a motion filed by Vice-President Sara Duterte-Carpio and two officials of the Office of the Vice-President (OVP) seeking to overturn the disallowance of P73.29 million in confidential expenses incurred in 2022, leaving the three personally liable to refund the amount in full.

In a decision dated Oct. 5, the CoA Proper sustained its earlier ruling that upheld the notice of disallowance issued against the OVP. The ruling covers P73.29 million of the P125 million in confidential funds released to the office on Dec. 20, 2022, for expenses incurred from Dec. 21 to 31 of that year.

CoA held Ms. Duterte, Special Disbursing Officer Gina F. Acosta and Chief Accountant Julieta L. Villadelrey personally liable to refund the full disallowed amount. The commission assigned liability to Ms. Duterte for approving the cash advance transactions, to Ms. Acosta for disbursing the money, and to Ms. Villadelrey for certifying the supporting documents. A denial with finality closes the commission's internal review process; officials who question a CoA ruling may still take the case to the Supreme Court through a petition for certiorari.

Of the disallowed sum, P69.79 million was spent on informer rewards — P10 million in cash, P34.86 million in goods and P24.93 million in medicines — while another P3.5 million went to tables, chairs, desktop computers and printers.

CoA said the disbursements failed to comply with Joint Circular No. 2015-01, the joint rules governing the grant and use of confidential and intelligence funds; Presidential Decree No. 1445, the Government Auditing Code; and the 2022 General Appropriations Act, the law authorizing that year's government spending.

“Disbursement of large public funds deserves no less,” the commission said. “Taxpayers’ money should always be spent with paramount consideration of full transparency and reasonable budget allocation.”

Informer Rewards Deemed Unsupported

State auditors said the OVP failed to provide documentary evidence showing tangible operational results from information supposedly supplied by eligible informers to justify the P69.79 million in rewards. Instead, the office submitted lists of routine activities and a certification from the Vice Presidential Security and Protection Group, whose personnel CoA noted were active military officers and therefore ineligible to receive informer rewards under audit rules. Because confidential funds are spared ordinary disclosure requirements to protect sources, audit rules instead require solid proof that disbursements were actually made and produced concrete results.

The commission also found that the OVP submitted acknowledgment receipts instead of the required proof of payment, leaving the reward expenses unsupported.

“It is as plain as day that the acknowledgment receipts cannot amount to a substantial compliance with the CoA rules, the joint circular, and the General Appropriations Act,” Co said.

The audit body likewise questioned the P3.5 million spent on office furniture and information technology equipment, saying the OVP had failed to show how buying standard office equipment through regular procurement would have compromised confidential operations.

CoA rejected the officials’ claims of good faith and due process violations, ruling that their failure to comply with mandatory audit rules constituted gross negligence amounting to bad faith.

OVP Response

The OVP said on Wednesday it had yet to receive a copy of the Oct. 5 CoA resolution on its motion for reconsideration.

“The office has already anticipated the possibility of this decision and has prepared to respond through the appropriate legal and institutional channels,” it said in a statement.

The office added that it remained committed to its mandate “to develop and promote programs that uplift the lives of the Filipino people.”

NEA Subsidy Findings

Separately, CoA flagged the National Electrification Administration (NEA), the state agency that supervises the country's electric cooperatives, over P1.76 billion in subsidy funds granted to 56 electric cooperatives that remained unliquidated — meaning the recipients had not submitted the required accounting of how the money was used — as of Dec. 31, 2025. According to state auditors, the subsidies were released from 2014 to 2025 and had remained unliquidated for periods ranging from three days to 11 years.

CoA also found that NEA had released P96.91 million to a delinquent electric cooperative despite its continued failure to comply with program rules.

“Due to NEA’s laxity in the enforcement of the provisions of the [memorandum of agreement], as well as other applicable NEA issuances, the unexpended subsidy funds have accumulated to P984.998 million and remained unsettled and unreturned,” state auditors said.

They said the failure to recover the money had deprived the National Government of funds that could have been used for other electrification projects, and CoA called for the immediate recovery of the nearly P1 billion in unspent subsidy funds that had accumulated and remained unsettled.

The subsidy findings were among the issues cited in CoA’s qualified opinion on NEA’s 2025 financial statements — a rating meaning the financial statements are fairly presented except for the specific matters the auditors identified. Auditors found that P55.02 million in computer software and Microsoft licenses had been improperly classified as property, plant and equipment instead of intangible assets. CoA also identified P17.1 million in erroneous service income adjustments that affected NEA’s P5.27-billion accumulated surplus account.

“The verifiability and reliability of the deferred tax assets account under other assets with a balance of P29.777 million as of Dec. 31, 2025 cannot be determined,” the auditors said, citing insufficient support for the amount and inadequate disclosures in the financial statements.

NEA also had P133.37 million in unsettled audit disallowances as of Dec. 31, 2025, according to CoA.

The commission recommended that NEA demand the immediate return of unused subsidy funds, properly classify its software assets and enforce applicable rules against electric cooperatives that fail to comply with program requirements.