COA denies Primewater's P24 million claim vs. Jaen Water District

The Commission on Audit (COA) has denied Primewater Infrastructure Corp.’s P24 million money claim against Jaen Water District (JWD) due to lack of documentation.

In a decision dated January 27 but only released on Tuesday, February 18, state auditors said Primewater failed to submit documents which will prove that the company and JWD inked a memorandum of agreement (MOA) to reconcile and settle the accounts of all amounts collected or expenses pursuant to the joint venture agreement between the two firms.

“After a judicious evaluation, this Commission denies the petition for lack of proper documentation.There is nothing in the records that show how the parties came up with the amount of P24,200,405.24,” COA said.

COA also cited Section 4.6 of the Government Auditing Code of the Philippines and Section 2.b, Rule 8 of the 2009 Revised Rules of Procedure of COA which provide that financial transactions and operations of any government agency should be supported with complete documentation.

“It is incumbent upon Primewater to present evidence that the amount claimed is accurate, such as its financial statements under the JVA, supported by certified schedules of revenues, operating expenses, capital expenditures, and changes in the working capital,” COA said.

“Having failed to substantiate its claim with complete documentation, this petition must fail,” COA added.

Likewise, COA said that Primewater's lack of business permit does not void the JVA between the two parties—an agreement which gave Primewater the right to collect using JWD receipts.

On October 28, 2016, JWD and Primewater entered into a joint venture agreement  for the financing, development, rehabilitation, expansion, improvement, operation, and maintenance of the water supply and septage management system in Jaen, Nueva Ecija. Both parties decided to continue their operations under the same agreement on January 6, 2017 even if Primewater’s business permit was still under process.

"During the interim period within which the application for business permit had been pending (January 6, 2017 to April 15, 2017), the official receipts of JWD were used for the payments received by the joint venture from the customers, but the actual collections were deposited in the bank account of Primewater," COA pointed out.

In seeking the P24 million money claim, Primewater Infrastructure  Corp. was represented  by its assistant vice president/Business Development head, Romeo Sabater. —LDF, GMA News