COA asks LTO to address findings on online portal system

The Commission on Audit (COA) has issued a notice of suspension on the P3-billion joint venture agreement between the Land Transportation Office (LTO) and German IT company Dermalog for the country’s Land Transportation Management System (LTMS) amid questions on its legality and propriety, state auditors confirmed to GMA News Online on Wednesday.

“Please be informed that, as confirmed by the COA Audit Team assigned at the LTO, an NS (notice of suspension) was indeed issued in connection with the project in question. Under the COA Rules and Regulations on Settlement of Accounts, an NS is issued for transactions that raise doubts about their legality, propriety, or regularity, which may result in financial loss to the government,” COA said in its letter dated February 26.

The said NS was issued by the COA since LTO did not reply to the state auditors’ queries on the said LTMS project in May and November 2024 correspondence.

Once an NS is issued, COA explained that the recipient parties are given reasonable time to comply with requirements as stated in the NS.

“To lift the suspension, the parties must submit the necessary justification, explanation, or documentation and demonstrate to the Auditor that the transaction is lawful and proper and does not cause any financial loss to the government. If the parties fail to do so, the transaction will be disallowed in the audit,” COA said.

State auditors, however, said a notice of suspension is not a final finding and as such, did not elaborate on the content of the NS issued to the LTO-Dermalog joint venture on LTMS to prevent prejudice.

“The issuance of an NS is not regarded as a final audit disposition. Disclosing information at this stage of the audit could prematurely subject parties to public scrutiny before relevant facts are gathered,” COA said.

“Thus, while we recognize the public’s right to information on matters of public interest and transactions, we are precluded, in the meantime, from furnishing you with a copy of the NS. Rest assured that the Commission is doing its best to address the concerns of the public,” COA added.

GMA News Online is trying to reach out to LTO for its side.

Back in May 2024, LTO chief and Assistant Secretary Vigor Mendoza II said that it would not terminate its LTMS contract with Dermalog because the LTO does not have sufficient technical know-how to take charge of the LTMS.

“We cannot on our own run the system without the assistance of our IT service provider Dermalog. The LTO does not have sufficient IT knowhow and personnel to take charge of the system,” Mendoza said before a House panel inquiry then.—LDF, GMA Integrated News