THE COMMISSION on Audit (CoA) has flagged the Corregidor Foundation, Inc. (CFI) for not seeking appropriate approval for human resource payments worth P61.66 million as well as failing to remit taxes worth P3.30 million.

In its 2022 audit report made available online on June 15, 2023, state auditors noted that the “payment of personnel services from 2018 to 2022 aggregating to P61.66 million is unauthorized due to the absence of Governance Commission for GOCCs-approved Total Compensation Framework of CFI.”

The Governance Commission for government-owned and controlled corporations, as part of strengthening its monitoring work, requested the CFI in 2017 to submit a Total Compensation Framework, which will contain its salary structure and cash and non-monetary benefits and allowances.

CoA said the CFI did not comply as the foundation maintains that it is a private corporation not covered by Republic Act No. 10149 or the GOCC Governance Act.

The CFI has responded to CoA saying that it will seek the GCG’s post-facto approval of the standard salary rates from 2018 to 2022.

The CFI was created in 1986 under the Philippine Tourism Authority, now the Tourism Infrastructure and Enterprise Zone Authority (TIEZA), to develop the historic Corregidor and its neighboring islands as a major tourist attraction in the Philippines.

CoA also said that the CFI has unremitted taxes withheld worth P3.30 million that “may incur penalties, interests and fines for late filing or remittance contrary to sections 248, 249 and 255 of the National Internal Revenue Code (NIRC) of 1997.”

CFI used its cash sourced from withholding taxes due to lack of funds for operations. However, CoA said this may result to the piling up of unpaid taxes and depletion of the CFI’s resources.

In response, the foundation said it will submit a request for a compromise agreement as the CFI is currently “not capable” of paying the full amount to the Bureau of Internal Revenue.

State auditors also said that assets worth P2.71 million purchased from Sun Cruises, Inc. and not covered under a compromise agreement “may be considered as unnecessary expenditures,” citing its 2012 circular.

Sun Cruises, which provided cruise and tour services to the Corregidor Island, closed down in 2020 due to the pandemic.

CFI said that the assets purchased, particularly items inside the Corregidor Inn, are “necessary because the CFI has no choice but to continue to operate the hotel” after Sun Cruises closed.

CoA still found the purchasing of assets “unnecessary considering the CFI’s unstable financial condition and lack of capability to run the hotel.” — Beatriz Marie D. Cruz