The Commission on Audit (COA) said that the province of Camarines Sur should treat its P160 million Vetiver grass in its plantation project as "biological assets" instead of charging the funds to its agricultural supplies account.
Internationally-published articles state, among other things, that Vetiver grass "plays a vital role in watershed protection by slowing down and spreading runoff harmlessly on the farmland, recharging ground water, reducing siltation of drainage systems and water bodies, reducing agro-chemicals loading into water bodies and for rehabilitation of degraded soils."
In its 2023 annual audit report, COA said that Camarines Sur started a Vetiver Grass Plantation project in a 7,000-hectare timberland in Barangay Pamplona in Del Gallego town in 2022.
The province stated that the project's goal is to establish a steady supply of Vetiver grass which will foster the rehabilitation of the watershed areas in the 1st district of Camarines Sur, prevent soil erosion in the area, provide opportunities for the local government to cultivate and process Vetiver grass, and generate income and rural industrialization.
COA said its auditors found that Camarines Sur procured Vetiver grass tillers worth P160 million which was charged to the Agricultural Supplies Expenses account. The total procurement in 2022 was P40 million, while the remaining P120 million was procured in 2023, it said.
It said that when the audit team conducted a site inspection of the property, they found that Vetiver grass planted in about three hectares were harvested and sent to a laboratory in Zambales for oil testing.
It also said that its inquiry showed that the oil test yielded promising results, and the oil will be subjected to further testing in an international facility which will determine the viability of the essential oil processing project in the global market.
"With this current foresight, the Vetiver plants in the property will most likely be used by the province as a source of raw materials for the production of Vetiver essential oil. Lastly, the plans for rural industrialization by putting up Vetiver oil processing facilities are already being discussed between key officials and possible partner companies and entities," the audit report stated.
Thus, COA said that Vetiver tillers (grown up grass) should have been regarded as biological assets of the provincial government.
"As these plants will remain in the provincial government's control and future economic benefits associated with the asset will flow to the local government unit through its cultivation, these plants should have been recorded in the books as Plants and Trees and monitored to assess whether a change in their value warrants adjustment in the books," it said.
"The charging of these assets directly to Agricultural Supplies Expenses account has, therefore, resulted in the understatement of the assets and overstatement of the expenses of the province by P160 million," it added.