The P4 million financial assistance given by the Bacolod City government to the Silver MassKara Festival Organization Inc. last year has no appropriation, and in violation of procedures set forth by law, according to the Commission on Audit observation memorandum dated Feb. 25, 2008 sent by COA regional cluster director Maria Gleda Lim to Mayor Evelio Leonardia.

The audit observation memorandum signed by Loda Arabelo, auditor in charge, stated that the 2007 annual budget did not provide for the P4 million financial assistance given by the city to the SMFOI.

It said the city entered into a memorandum of agreement with the SMFOI for the latter to be given financial assistance of P4 million to perform functions necessary and related to the MassKara Festival of 2007 and the 69th Charter Day celebrations.

The fund was sourced from the appropriated amount of personnel benefit fund as certified by the City Treasurer and City Budget Officer on Sep. 11, 2007.

The MOA stated that the amount will be replenished as soon as the savings from other sources are realized so that the personnel of the city can likewise avail of the benefit which will be granted to them before the end of the year.

The appropriation of P4 million financial assistance to the organization, which was authorized by the SP through Appropriation Ordinance 16 series of 2007, was without legal basis, the COA memorandum said.

The funding source of Appropriation Ordinance No. 16 was certified by the City Treasurer as available under the personnel benefit fund class of expense while the financial assistance is under the Maintenance and Other Operating Expenses,  is another class of expense, it said.

The COA pointed out that Section 322 and Section 336 both of R.A. 7160, clearly provides that appropriated funds shall be available exclusively for the specific purpose for which they have been appropriated and prohibits the passing of an ordinance authorizing the transfer of appropriations from one item to the other.

It recommended that the SP observe procedures provided by law in passing appropriation ordinances regarding lawful transfer of funds already appropriated for specific purposes as contained in the approved annual budget.

It also recommended that the City Treasurer and City Budget Officer submit justification on the certification they issued as to the availability of the P4 million for appropriation, the fact that it was already appropriated for PBF in the 2007 annual budget.  

Bacolod Vice Mayor Jude Thaddeus Sayson yesterday said that, considering that the amount was a financial assistance, it does not need an appropriation in the annual budget. He believes that the SMFO is ready with its liquidation report, he said.

Before the fund was released, the SMFO submitted its program of works for the P4 million budget, Sayson said. This was the basis of the action of the SP when it approved the Appropriation Ordinance aside from the recommendation of the Mayor and the certifications issued by the City Treasurer and Budget Officer, who are more knowledgeable about accounting procedures, he said.

Sayson said they will review their procedures as recommended by COA considering that there are new accounting procedures now being implemented. When the SP passed the Appropriation Ordinance, they believed they had observed proper procedures since, in the past, they had been giving financial assistance to fund other activities aside from the MassKara Festival, he said. They also grant financial assistance to non-government organizations who have been helping the city in its programs and projects, he added.*CGS

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