REIMBURSEMENT: An alternative method?

This query may sound a bit iterative. We know that reimbursements, although
discouraged, still occurs (sometimes a lot). Although there were suggestions to still post
the "reimbursements" and their nature can be classified to appropriate AMP (Alternative
Methods of Procurement), the question is... is it practical?

Now, which weighs more: its practicality? or accountability?

Practicality suggests NO even if we insist on "for posting/information purposes only",

while accountability may not apply (since there is no way you can invite competition in
reimbursements).

Any better idea(s)?

Reimbursement as an alternative method

By definition, reimbursement means repayment for expense incurred. This repayment is made
by the government agency to the personnel who advanced payment of an item from the latter's
personal account in favor of the former. Thus, the act of the government agency in reimbursing
the personnel is more of an act of payment than an act of procurement.

However, the process conducted by the personnel in selecting from which establishment he/she
purchases a specific item up to the purchase of the item itself, in my opinion, constitutes the
very act of procurement. Since reimbursement happens after the actual purchase, it cannot be
considered a method of procurement.

Moreover, the concerns on practicality and accountability more squarely apply to the process of
selection up to payment rather than reimbursement itself inasmuch as the latter involves a
somewhat ministerial act by the government of repaying the personnel for the item he/she
procured.

In addition, reimbursement happens ex post facto procurement. This situation is best illustrated
in the case of shopping due to unforeseen contingency where a government personnel advances
the payment of an item immediately needed for the performance of a particular function. The
manner by which the personnel selected the supplier of the item and the actual purchase
therefrom constitutes "procurement". When he gets back to his office and presents the receipt
for "reimbursement", this act no longer involves procurement, but repayment.

Clearly then, the fact that procurement has already occurred negates the possibility of
considering "reimbursement" as a method of procurement. Whether or not there is a need to
post the procurement opportunity at the PhilGEPS is an issue which may be discussed separately
from this topic.

Reimbursement is definitely not an alternative mode of procurement.

If at all, maybe we can call it as an "alternative mode of payment".

Under existing COA rules (COA, kindly correct me if I am wrong),

payment by check is the generally-accepted mode. Where cash
payment is allowed, it should be charged against cash advances
or against Petty Cash Fund (See also PCIJ article on the "euro generals"
"cash advance" http://i-site.ph/dailypcij/?p=25).
Reimbursement would most likely fall under "Irregular Expenditures"
(Please see definition under COA Cicular 85-55-A dated Sep. 8 1985
http://www.coa.gov.ph/Rules.htm). Payment for emergency purchases,
where there is no emergency, is one such example. Irregular expenditures
may later be disallowed in audit by COA, that is why it should be
discouraged, if it could not be totally avoided.

Going back to the procurement process, the procurement itself could

generally fall under the alternative method of "Shopping" allowed under
Sec. 52(a) of IRR-A. On the posting requirement, Sec. 54.2(h) provides
that: "With respect to item (a) of Section 52 of the Act and this IRR-A
while the procurement activity would still have to be posted in accordance
with the provisions of Sec. 21.2.3 of this IRR-A, the period for posting
required therein may be waived by the procuring entity concerned."
In other words, posting may be done after procurement has taken place,
precisely for reason of "unforeseen contingency."

May i also refer you to the Procedure for Shopping in the LGU Procurement Manual,
page 72 ( http://www.gppb.gov.ph/downloadables08/downloadables.asp?d_cat_id=1 )
where posting "for information purposes" only is still required.

REIMBURSEMENT
by RDV @ GP3i on Thu Dec 18, 2008 1:30 pm

I would say YES on that, with the following caveats:

In case of unforeseen contingency requiring immediate purchase

under Sec. 52(a), the mode of procurement (both for filling up the
posting requirement in the PhilGEPS and updating the APP, if necessary)
is SHOPPING. The posting period is waive, meaning it could be posted
after the procurement was done or the goods have been delivered.

In the case of Sec. 53(d) (where there is imminent danger to life or

property during a state of calamity, or where time of the essence... or
immediate action is necessary...), the period of posting may also be waived
or shortened and the award shall also be posted in the PhilGEPS in accordance
with Sec. 54.2(d). (Please see also GPPB opinion on the matter
http://www.gppb.gov.ph/opinions08/view_opinion.asp?o_id=219 )