The Commission on Audit (COA) has flagged the Department of Tourism (DOT) over its P20.85 million procurements that cast doubts on the reasonableness of the awarded contracts in 2024.

"Review of procurements conducted by the DOT disclosed several lapses in complying with the Revised Implementing Rules and Regulations of Republic Act No. 9184 (Government Procurement Reform Act)," the COA said in its 2024 annual audit report.

The COA said that the DOT did not strictly follow proper procurement processes and thus affected the transparency, accountability, efficiency, and economy of the said contracts with a total amount of P20,853,710.58.

It said that the DOT’s National Capital Region (NCR), in particular, purchased airline tickets for domestic and international travel using Small Value Procurement (SVP) instead of Direct Retail Purchase and used up P661,035.18.

It also said the NCR personnel admitted that they had not been informed or directed to use the Direct Retail Purchase Method, and continued to purchase tickets through Agency-to-Agency mode of procurement with Procurement Service (PS)-Department of Budget and Management (DBM).

The DOT offices in the Cordillera Administrative Region (CAR) and Region II failed to require bank guarantee on cash advances to suppliers and failed to impose liquidated damages, the COA said.

It said the CAR approved supplemental agreements covering an average increase of 25 percent or P129,040 of the original amount for meals and snacks of P506,450 exceeded the allowed 10 percent of the original contract amount for its walk-in training participants.

Also, it said that the CAR office did not require an irrevocable letter of credit or bank guarantee equivalent to the 15 percent advance payments to suppliers totalling P330,450 relative to various contracts with an aggregate amount of P2,203,000.

In the case of Region II, the COA said the DOT regional office failed to impose P709,650 liquidated damages on late deliveries on its contracts. As a result, it said there was an overpayment to suppliers amounting to P13,223.80.

There were likewise several deficiencies in compliance with documentary requirements for the different alternative methods of procurement in Regions IV-B, X, XI, and CAR, the COA said.

"Training and seminars of the DOT Region IV-B were held in privately-owned venues under various contracts totalling P1,581,810. Moreover, Management explained that they explored the availability of publicly-owned venues to host the training, however, no government facilities within the locality had the necessary amenities, capacity, and catering services to adequately accommodate their requirement," it also said.

The DOT Region X, on the other hand, issued a request for quotation (RFQ) to only one supplier for the acquisition of seven sets of furniture amounting P364,200 through Negotiated Procurement, even though agencies need to issue the RFQ to at least three suppliers, the COA pointed out.

Thus, it said there were deficiencies in its procurement for the region's Philippine Experience Program (PEP)-Mindanao Leg for P2,907,500.

For Region XI, the COA said that five transactions for the procurement of meals and lease venue worth P581,445.80 were done through Negotiated Procurement instead of Lease of Real Property or Venue.

There were purchases made for various items for special purpose activities of DOT Region VIII of P299,395 and P1,018,376.10, which were only supported with Official Receipts, Acknowledgment Receipts, and Reimbursement Expense Receipts since these were not made through any of the prescribed alternative modes, it also said.

At the same time, the COA said its audit teams discovered splitting of transactions committed by the DOT in Region IX on two contracts with an aggregate amount of P2,114,997.

"Management informed us that there was a sudden increase in the number of participants a week before the event. They had to supplement the original Purchase Orders in order to accommodate them, thus exceeding the threshold for competitive bidding," the COA said.

It noted that there were two transactions made that had inadequate documentation -- the purchase of various items worth P3,804,751.50 by Region IV-B and the procurement of training kits for P62,400 by Region IX.

The DOT also engaged in business with bidders that did not meet eligibility requirements and offered inadequate post-qualification procedures, the COA said.

It noted that Region IX procured goods and services from two suppliers for P1,298,000 even though the suppliers were not qualified to transact business with them, as their Mayor's Permits revealed that their declared line of business was not aligned with the nature of the goods and services procured.

DOT Region IV-B procured buri hats and wireless lapel worth P973,000 from a supplier that offered P88 each for 10,000 pieces of buri hats. However, the COA said there was a "deviation" from the published requirement of 11,000 pieces at P80 each.

Another issue flagged by the COA was an "arrangement" made between the DOT Region IX and its supplier on the purchase order worth P148,000 that was issued on March 7, 2024 but the delivery receipt was dated Feb. 28, 2024.

Lastly, the COA said there were three vehicle rentals worth P98,450 made by the Region XI which exceeded its approved budget cost of P87,000.