Boy Scout of the Philippines vs Commission on Audit

GR No. 177131
June 7, 2011

FACTS

COA issued a Resolution No. 99-011 on August 19, 1999, with the subject “Defining the Commission’s
Policy with respect to the audit of the Boy Scout of the Philippines.” The BSP which was created as a public
corporation, and that in BSP vs. NLRC, the Supreme Court ruled that the BSP, as constituted under its
charter, was a Government Owned and Controlled Corporation within the meaning of Art. IX (B) (2) (1) of
the Constitution, and that the BSP is regarded as a government instrumentality under the Administrative
Code. For the purposes of audit supervision, the BSP shall be classified among the government
corporations to be audited by employing the team audit approach. The BSP sought reconsideration of the
COA Resolution in a letter signed by then BSP National President Jejomar C. Binay, saying that it is not
subject to the COA’s jurisdiction.

ISSUE

Whether or not the Boy Scout of the Philippines is a government owned and controlled corporation?
Whether or not it is under the jurisdiction of the COA?

HELD

After looking at the legislative history of its amended charter and carefully studying the applicable laws and
the arguments of both parties, The SC finds that the BSP is a public corporation and its funds are subject to
the COA’s audit jurisdiction.

The BSP is a public corporation or a government agency or instrumentality with juridical personality, which
does not fall within the constitutional prohibition in Article XII, Section 16, notwithstanding the amendments
to its charter. Not all corporations, which are not government owned or controlled, are ipso facto to be
considered private corporations as there exists another distinct class of corporations or chartered
institutions which are otherwise known as "public corporations." These corporations are treated by law as
agencies or instrumentalities of the government which are not subject to the tests of ownership or control
and economic viability but to different criteria relating to their public purposes/interests or constitutional
policies and objectives and their administrative relationship to the government or any of its Departments or
Offices.

Since the BSP, under its amended charter, continues to be a public corporation or a government
instrumentality, we come to the inevitable conclusion that it is subject to the exercise by the COA of its audit
jurisdiction in the manner consistent with the provisions of the BSP Charter.