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Sunday, September 29, 2013

COA questions Nabcor's financial consultant

by Michael Punongbayan, The Philippine Star

The Commission on Audit (COA) has questioned the hiring of a private lawyer by the National Agribusiness Corp. (Nabcor) as its financial consultant last year.

State auditors said the government-owned and controlled corporation, which is among the agencies under investigation for alleged involvement in the pork barrel fund scam, had irregularly disbursed more than P5 million to the consultant as of Dec. 31, 2012.

The COA said the hiring of a financial advisor “was wanting of legal basis” since the Nabcor had no need for such.

State auditors said the payment of more than half of the contract price to the financial advisor was in violation of Presidential Decree 1445 or the Government Auditing Code of the Philippines.

Records showed that Nabcor, an attached agency of the Department of Agriculture, entered into a P10.3-million contract with the financial consultant in April 2012.

The lawyer’s job, among others, was to obtain approval of a Debt Restructuring Plan (DRP) from the Philippine Deposit Insurance Corp. (PDIC).

Data gathered by COA showed that Nabcor has an outstanding loan totaling P1.676 billion, consisting of principal of P968.171 million and interest of P707.719 million as of Dec. 31, 2012.

“There is no necessity for the expertise of a financial advisor for the purpose of obtaining a DRP on NABCOR’s loan from PDIC,” state auditors said.

“Considering that both are government entities, Nabcor should have negotiated directly with PDIC and achieved the same result, at no cost to the government,” the audit team noted. 
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