Adopting Standard Procedures and Requirements Governing Claims for Payment on Infrastructure Projects

May 13, 1981

LETTER OF IMPLEMENTATION NO. 136

ADOPTING STANDARD PROCEDURES AND REQUIREMENTS GOVERNING CLAIMS FOR PAYMENT ON INFRASTRUCTURE PROJECTS

WHEREAS, Letter of Instructions No. 1038 created a committee to recommend standard guidelines on processing of claims for payment of work done on government infrastructure projects;

WHEREAS, the Committee composed of the Executive Director of the Presidential Management Staff, acting as Chairman, the Ministers of the Ministry of Public Highways, Ministry of the Budget, Ministry of Public Works, Chairman, Commission on Audit and the Director-General of the Rational Economic and Development Authority, conducted studies and held consultations with the Philippine Contractors Association on the existing procedures and requirements;

WHEREAS, in compliance with the mandate of LOI 1038, the Committee has submitted recommendations on procedure and documentation for claims for payment on Infrastructure projects;

NOW, THEREFORE, I, FERDINAND E, MARCOS, President of the Philippines by virtue of the powers vested in me by law, do hereby order and direct:

1. All Ministries and Agencies concerned shall implement the following with repaid to claims for payment of infrastructure projects:

a. Progress Billings shall be prepared by the contractor, supported by a Statement of Work Accomplished to be reviewed and certified by the Project Engineer, and submitted to the Ministry implementing the project.

b. A checklist of the required documents should accompany the actual documents submitted by the contractor with the Process Billing to the Ministries and Agencies concerned to be used in checking the completeness of required documents.

c. The pre-audit function withdrawn by the COA shall not be duplicated by the agencies concerned.

d. Internal control should be instituted by the Ministries or Agencies concerned. Accordingly, the accounting and budget divisions should be strengthened, and systems and procedures therein reviewed to enable speedy processing, periodic analysis and reporting of results.

e. The implementing Ministries/Agencies should reduce the required supporting documents for processing of claims by eliminating those which essentially duplicate certified information already available in others.

f. The standard procedures prepared by the committee shall be adopted by all Ministries and Agencies including all government corporations, with only minor variations therefrom as may be required by the circumstances of the project or the agency's internal procedures.

g. The implementing Ministries/Agencies should adopt a time frame within which each processing step shall be completed.

h. The implementing Ministries/Agencies shall furnish the Commission on Audit a copy of the contract and its supporting documents within five (5) days after perfection thereof.

i. Unjustified failure to comply with the time frame set by the implementing Ministries/Agencies for each processing unit to complete a processing step, as well as the time frame set for submission of copies of contracts to the Commission on Audit shall subject the responsible person(s) or unit to appropriate administrative sanction or penalties.

2. The attached standard flow chart procedures on all levels and document requirements for payment of claims shall be implemented by the Ministries/Agencies concerned.

DONE in the City of Manila, this 13th day of May, in the year of Our Lord, Nineteen Hundred and Eighty-One.