MANILA — Malacañang said on Monday that the Commission on Audit's (CoA) adverse opinion on the financial statements of state-run Food Terminal, Inc. (FTI) will not affect the government's program to sell rice at P20 per kilo.

Palace Press Officer Clarissa A. Castro said the Department of Agriculture (DA) had informed Malacañang that FTI had already addressed the audit findings through an agency action plan submitted to the state auditor on Sept. 29. Such plans are the standard route by which government agencies seek to clear adverse audit findings, with the state auditor's evaluation determining whether the issues are formally resolved.

"And this adverse opinion, as we have said, has already been addressed; it will not affect the distribution and sale of rice at 20 pesos per kilo," Ms. Castro said in Filipino during a press briefing.

FTI, a government-controlled food trading and logistics firm attached to the DA, has been the government's main implementing arm for the P20-per-kilo rice program, a flagship subsidy initiative of the Marcos administration that sells affordable rice to qualified vulnerable sectors. Because the program's rice purchases and sales are booked through FTI, the opinion touches the same financial machinery the subsidy initiative runs on.

The adverse opinion concerned P5.43 billion in unsubstantiated trust liabilities involving the DA — in government accounting, funds an agency holds or manages on behalf of another entity, which must be backed by complete supporting records. An adverse opinion is issued when an auditor concludes that an entity's financial statements are materially misstated and do not fairly present its financial position, often because key accounts lack adequate documentation.

Separately, Ms. Castro confirmed that Malacañang was aware of the issue involving a shipment of rice imported from Vietnam that the DA had stopped from entering the country. She said Agriculture Secretary Francisco P. Tiu Laurel, Jr. had ordered the shipment's return because it lacked the necessary documentation — a reminder that, from audit records to import papers, documentation sits at the center of both issues surrounding the program.

"Secretary Tiu Laurel himself explicitly stated that he personally blocked this rice from entering — making it clear that the ship is being sent back due to a lack of proper documentation," she said, relaying the DA's response. — Pexcel John Bacon