10 Questions
What was established on May 8, 1899, through a memorandum signed by President William McKinley?
The Office of the Auditor for the Philippine Islands
What was introduced in the Bureau of the Insular Auditor to ensure a higher degree of correctness in settlements?
Double-entry bookkeeping
Who replaced William Howard Taft as Governor General in 1905?
Luke E. Wright
What milestone did the institution reach with the promulgation of the 1935 Constitution?
It was elevated to a constitutional body
Who became the first Filipino Auditor General in 1935?
Jaime Hernandez
What was the visita de tierra?
A visit of inspection made every three years
What was the purpose of the residencia?
To hold colonial officials accountable for their actions during their term of office
What was the role of the contador in auditing?
To require all books of accounts to pass through scrutiny and certification
When was the Tribunal de Cuentas created?
By mid-19th century
What was the jurisdiction of the Tribunal de Cuentas?
Exclusive jurisdiction over the audit of all financial matters affecting the colony
Study Notes
Auditing in the Spanish Colonial Era
- The Spanish colonial era recognized auditing as a tool for effective governance, with practices like residencia (inquiry into outgoing Governor General's administration) and visita de tierra (visit of inspection every three years).
- Colonial officials performed investigations similar to audits, including a fraud audit of the galleon trade in the early 1700s and an inspection of the Misericordia de Manila in 1751 with shades of financial audit.
- In 1739, a Royal Decree established the royal exchequer, requiring all books of accounts to pass through the scrutiny and certification of the contador (accountant) and oidor (representative of the Spanish crown, precursor of the auditor).
The Tribunal de Cuentas
- By mid-19th century, the Tribunal de Cuentas was created as the supreme auditing institution of the islands until the end of Spanish rule in 1898.
- It functioned with a president, two auditors, a fiscal, accountants, and examiners, all appointed by the King, to review vouchers and cross-check them against corresponding entries in the books of accounts.
The Birth of the Office of the Auditor
- In 1899, President William McKinley signed a memorandum creating the Office of the Auditor for the Philippine Islands, ensuring prudence in the early Philippine government.
- By 1900, the Office had become a fixture of government, and by 1901, it was converted to the Bureau of the Insular Auditor with a provincial audit division and introduction of double-entry bookkeeping.
Growth and Changes
- In 1905, the Bureau of the Insular Auditor was renamed the Bureau of Audits under Act No. 1402.
- With the promulgation of the 1935 Constitution, the institution became a constitutional body, renamed as the General Auditing Office (GAO) and headed by a Filipino Auditor General, Jaime Hernandez.
- The GAO was placed under the direction and control of the Auditor General, separating it from the Executive and other departments of government.
This quiz covers the history of auditing as a tool for effective governance, specifically during the Spanish colonial era. It explores the residencia and visita de tierra, measures used to hold colonial officials accountable.
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