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Article 155 Point 5).- It is the duty of the Legislative Assembly to appoint the Comptroller General of the Republic and the Deputy Comptroller General.
Article 275.- An autonomous state body called the Office of the Comptroller General of the Republic shall be set up, headed by a public servant who will be called the Comptroller General, while the second in charge will be the Deputy Comptroller General, both of whom shall be appointed for the same term of office as the President of the Republic. During this term they can not be dismissed or removed from office by any authority except the Supreme Court of Justice, for reasons set out in this Law. Both the Comptroller General and the Deputy Comptroller General shall be appointed so that they take office from the first of January after the beginning of each ordinary Presidential term.
In order to be the Comptroller General or Deputy Comptroller General of the Republic, the requirements are: to be a citizen of Panama by birth; to have a university degree; to be of thirty-five (35) years of age or more; and to not have been condemned by the Judiciary with a punishment depriving him of his liberty for committing a crime against the public administration.
Article 276.- The duties of the Comptroller General of the Republic, besides those indicated in the Law, are the following:
1) To maintain the national accounts, including those in matters of internal and external debt.
2) To oversee, regulate and control all acts with regard to the handling of public funds and other assets in order to ensure that they are carried out correctly and in accordance with the provisions of the Law.
The Comptroller’s Office shall decide in which cases it will perform both a priori as well as a posteriori control on the acts of handling of public funds and assets, as also those in which it will perform only the latter.
3) To examine, audit and close the accounts of public officers, entities or persons administering, managing or safekeeping public funds or assets. All matters pertaining to penal responsibility shall vest with the ordinary courts.
4) To conduct investigations and inspections in order to determine the degree of correctness or incorrectness of operations affecting public property and, if the need arises, file the pertinent claims.
5) To collect from the concerned civil servants, information on the financial administration of public, national, provincial, municipal, autonomous and semi-autonomous departments and public entities.
6. To lay down and promote the adoption of such measures as may be required to see to it that credits favouring public entities are actually paid.
7. To demand that laws and acts which violate the Constitution or the Law, adversely affecting public wealth, be declared unconstitutional or illegal, depending on the case.
8. To establish accounting methods for those public agencies indicated in point 5) of this Article.
9. To inform the Legislative Assembly and the Executive Organ about the financial state of public administration and offer an opinion on the viability and propriety of granting supplementary and extraordinary credit.
10. To direct and prepare national statistics.
11. To appoint employees for its departments in accordance with the Constitution and the Law.
12. To present the annual report of its activities to the Executive Organ and the Legislative Assembly.
13. To judge the accounts of the agents and employees handling public funds, when objections arise due to alleged irregularities in their accounts.
Article 1.- The Office of the Comptroller General of the Republic is an independent state body of a technical nature, whose mission is to oversee, regulate and control the movement of public funds and assets, and examine, audit, close and evaluate their accounts. Besides this, the Office of the Comptroller General shall maintain the national public accounts; it shall prescribe accounting methods and systems for public departments; and it shall direct and prepare the national statistics.
Article 2.- The scope of the authority of the Office of the Comptroller General extends to all persons and bodies in charge of the custody and handling funds or assets belonging to the State, municipalities, town councils, state enterprises, autonomous and semi-autonomous entities, whether in the country or abroad. This authority also extends to those persons or bodies in which the State or public entities have a financial participation, and to those persons receiving subsidies or financial grants, in turn, from the said entities, and to entities engaged in public collections for public purposes; however, such authority shall be limited to the extent of the participation of the said public entities.
The scope of the Comptroller’s Office does not include trade unions, co-operative societies and other entities whose audit, vigilance and control, according to special legal provisions, fall under the scope of competence of other official bodies.
Article 3.- The Office of the Comptroller General shall be headed by a civil servant called the Comptroller General of the Republic who shall be the legal representative of the Institution, and the second person in charge shall be the Deputy Comptroller General. Both shall be appointed in the manner and for the period laid down in the Political Constitution. No public entity can set up or maintain administrative units in their organisations called "Comptroller’s Office", nor can they create any post called "Comptroller General".
Article 4.- In order to hold the office of Comptroller General, or Deputy Comptroller, the following requirements stipulated in the Political Constitution must be met. During their term of office, these civil servants can be suspended or removed from office only by the Supreme Court of Justice for the following reasons:
a) Having committed a crime against the Public Administration, against public wealth or public trust or, in general, for having committed any crime punishable mainly by imprisonment.
b) Having committed any crime in respect of misuse of authority or infraction of the duties of civil servants, or
c) Having displayed evident incompetence or negligence in the performance of their duties.
Article 5.- The Office of the Comptroller General shall consist of a Central Institution and of such departments or offices as may be necessary for the performance of its functions. Consequently, the Comptroller General can create regional offices in different parts of the country and in other organs of the State, in Ministries, in autonomous and semi-autonomous entities and in municipalities, as and when justified by the requirements of service. The staff will be appointed by the Comptroller General who, in accordance with the rules, shall determine the requirements to be met for the post and the duties and responsibilities it entails. The Central Institution shall basically exercise its functions on the operations pertaining to the handling of public funds by the Central Administration, and its expenditure shall be met from the National Treasury.
The expenditure incurred for the audit and control services rendered in decentralised entities shall be met by the entity in question in a ratio to be decided by the Comptroller’s Office.
Similarly, the budgets of the various departments must include the costs of audit and control services for the special programmes they are jointly implementing with the Office of the Comptroller General.
Article 6.- The Central Institution of the Comptroller’s Office shall consist of the offices of the Comptroller General, the Deputy Comptroller General, the Secretary General, the Board of Directors and other such directorates and departments as may be necessary for it to effectively carry out its mission. It shall also include offices in charge of auditing the accounts.
The Comptroller General shall be empowered to set up sub-divisions of different departments in the Office of the Comptroller General and merge or abolish these sub-divisions, granting them the specific powers they require through the Internal Rules of the Institution.
Article 7.- The heads of the Control Departments in the autonomous and semi-autonomous entities, government undertakings, town councils and municipalities, shall have the powers conferred on them by the Comptroller General, in accordance with the Constitution, the Law and the rules, with regard to audit and control of the handling of public funds and assets.
Article 8.- Selection of personnel for the Office of the Comptroller General and their promotion shall be done on the basis of the personal and professional merits of the candidates. For the purposes stated in this Article, a system of classification of posts and a selection process meant to guarantee that the selected candidate is the best suited to the position he has to work in, and that all promotions are based on fair recognition of the merits of the civil servant being promoted, shall be included in the Internal Rules of the said body. Similarly, any dismissal or demotion must be preceded by an inquiry into the allegations against the civil servant, who must be given the right to defend himself.
A service track record will be maintained for each one of the Institution’s employees which shall include the yearly assessment of his performance.
Article 9.- Employees of the Comptroller’s Office shall be made permanent depending on their suitability for the post, loyalty, seniority and integrity in performing their duties of public service. The prevailing Law of Civil Services stipulates that any person who has worked in the Comptroller’s Office, to satisfaction, for a minimum period of five (5) years, shall enjoy permanency and can not be dismissed except for such causes as laid down in the Law or in the Internal Rules, if they are duly proved. For purposes of this stipulation, the years of service rendered before this Law came into force shall be counted as part of the five years.
In order to decide whether its employees are to be made permanent or not, the Comptroller’s Office shall examine their records and issue the certificates of permanency in the month following the promulgation of this Law.
Article 10.- The general budget of the State shall include adequate heads to cover the expenses of the Office of the Comptroller General of the Republic. In those years when the national census must be taken, special heads must also be included in accordance with the outlays required by such census.
The Office of the Comptroller General of the Republic shall prepare the draft of its own budget which, after being discussed with the Ministry of Planning and Political Economy, shall be included in the Draft of the General Budget for the State.
The budget of the Comptroller’s Office shall be increased in the same ratio as the overall amount of the General Budget of the State.
The Office of the Comptroller General shall be empowered to hire such equipment and services in order to perform its duties, in accordance with proper legal procedures and with the appropriate budgetary sanctions.
Article 11.-In order to accomplish its mission, the Office of the Comptroller General shall be vested with the following powers:
1. To maintain the national accounts that are necessary to reflect the financial operations of the State, including those pertaining to receipts, expenditure, public debt, both internal as well as external, and State wealth.
2. To supervise, regulate and control all acts in respect of handling of funds and other public assets, and to ensure that such acts are carried out with propriety and according to the relevant legal regulations. The Comptroller’s Office shall determine in which cases it shall perform both an a prior as well as an a posteriori control on the acts of handling of public funds and those cases in which it shall only perform a posteriori control. This decision shall be taken by means of a written order issued by the Comptroller General.
3. To examine, audit and close the accounts of civil servants, entities or persons in charge of administering, handling or safekeeping public funds or assets. Matters pertaining to penal responsibility shall be decided by the ordinary courts.
4. To carry out inspections and inquiries for purposes of determining the correctness or incorrectness of operations affecting public assets and, if required, to file the necessary cases. Such inquiries may be initiated on receipt of a formal complaint or at the government’s initiative, when the Comptroller’s Office deems it appropriate.
While conducting the investigation, the Comptroller’s Office shall take steps aimed at gathering the elements of judgement that would throw light on the facts. To this end, it is empowered to take testimonies, appoint experts, carry out inspections and conduct any other legally permissible tests.
5. To obtain reports from the Public Ministry on the state of summary investigations and penal proceedings on account of unlawful acts committed against res publica, with the objective of completing the records maintained by the Comptroller’s Office on the subject.
The Public Ministry and the Comptroller’s Office shall co-ordinate their work in such investigations and proceedings, so that each one of these government bodies may complete the mission assigned to it.
6. To obtain reports from the concerned civil servants on the financial management of the national, municipal, autonomous and semi-autonomous public offices, state undertakings and town councils, at intervals as warranted by the circumstances.
7. To establish and promote the adoption of measures necessary for providing credits to public entities. In those cases in which the officer in charge of taking such steps does not do so, either due to negligence or unjustified refusal, the Office of the Comptroller General shall write to the immediate superior of the officer concerned and if there is no superior in the hierarchy, it shall bring the matter to the notice of the Attorney General of the Nation, the Prosecutor for the Administration, or the President of the Republic, so that the sanctions envisaged in the Law may be imposed. When the Law has not instituted specific sanctions, the defaulting officer can be punished with a fine of up to one hundred balboas (B./100.00) the first time, suspension from his post for up to fifteen (15) days the second time, and dismissal if he persists in failing to perform his duty.
8. To demand a declaration of unconstitutionality or unlawfulness with regard to acts that, in violation of the Constitution or the Law, adversely affect public wealth. In order to resort to this measure, express authorisation will be required from the Comptroller General or the Deputy Comptroller General who, if they so wish, can have a prior consultation with the Attorney General of the Nation or the Prosecutor for the Administration.
9. To lay down the accounting methods and systems for national, municipal, autonomous and semi-autonomous public offices, government undertakings and town councils. These methods and systems shall be prepared in such a way that the accounts records can be used to generate the financial and budgetary data required to analyse a specific situation, so as to enable suitable assessment of how public assets are being administered and also be of use to the Comptroller’s Office in its task of audit and control.
Once the accounting methods and systems have been established by the Office of the Comptroller General, it shall, by means of a resolution, fix a date for their introduction by the respective government offices, and from that date onwards the new methods and systems will have to be compulsorily applied by the officers in charge.
Any violation of the regulation given in the foregoing paragraph shall entail sanctions as envisaged in point number 7 of this Article.
10. To take part in the preparation of the general budget of the State in the manner stipulated in the Constitution, to give an opinion on the viability and appropriateness of providing additional and extraordinary credits and reporting to the Executive Organ and to the Legislative Assembly on the financial state of the Public Administration.
The Comptroller’s Office shall give an opinion on any bills intending to withdraw income included in the Budget and institute other incomes in their place or increase the existing ones, in the manner laid down in Article 272 of the Constitution.
The Comptroller’s Office shall submit monthly and annual reports to the Executive Organ on the financial state of the Public Administration. However, it may do so more frequently when the circumstances so warrant.
Similarly, the Office of the Comptroller General of the Republic must, along with the Ministry of Finance and Treasury, and the Ministry of Planning and Political Economy, submit a plan for reduction of expenditure to the Executive Organ, when in any financial year they have reason to believe that the total cash receipts could be less than the total authorised expenditure in the national budget.
This plan should be submitted to the Cabinet Council for its consideration, and once it has been approved, it shall be compulsory for the Administration to implement it.
With regard to municipalities, town councils, autonomous and semi-autonomous entities, government undertakings and, in general, all bodies on which the Comptroller’s Office is empowered to conduct audits, this power shall be excised by the delegate or representative of the Comptroller to that particular entity, along with the other civil servants concerned, and the plan shall be submitted to the body authorised to adopt such measures.
11. To direct and compile national statistics, in accordance with the relevant legal provisions and rules. For this purpose, the Office of the Comptroller General can set up the required technical committees to promote improvement of national statistics.
12. To appoint employees for its departments according to the prevailing constitutional and legal regulations.
13. To lay a report on its activities before the Executive Organ and the Legislative Assembly.
14. To judge the accounts maintained by the agents or employees managing public funds, when objections are raised at the time of their submission or as a result of the investigations carried out by the Comptroller’s Office, and
15. Any other powers assigned to it by the law.
CHAPTER I
Methods and Systems of Accounting
Article 12.- The power to institute methods and systems of accounting for the public offices mentioned in the Constitution and to co-ordinate and ensure their correct application shall vest exclusively with the Comptroller’s Office.
Article 13.- The accounting methods and systems referred to in the foregoing Article must be instituted by means of rules and shall include, among other things, the accounts plan, the manner in which it has to be implemented, the relevant forms, flow charts and diagrams explaining the processes involved in each activity.
Article 14.- In the rules governing the introduction of the accounting system for a public office, the date on which such system will come into force shall be indicated. It is the duty of the Head of the Accounts Section of the public office in question to ensure that the system is applied and, in case he fails to do so, the sanctions listed in Articles 22 and 23 of this law may be imposed on him.
Article 15.- The Comptroller’s Office shall be authorised to look into the accounts of all persons receiving or disbursing public funds, or persons who are responsible for the safekeeping and control of funds or assets belonging to public entities. No public or private bank entity shall reveal the accounts of the said persons without prior authorisation from the Comptroller General of the Republic.
Article 16.- The Comptroller’s Office shall determine the manner in which accounts must be presented to the Comptroller General for him to examine and close.
CHAPTER II
Presentation of Accounts
Article 17.- Any person receiving, handling, safekeeping or administering public funds or assets is obliged to present the accounts to the Office of the Comptroller General in the manner and in the period of time stipulated in the rules framed by the said Office. This obligation shall extend to persons who, at the order of a public entity, administer funds or assets belonging to a third party, as well as to the representatives of companies or associations receiving grants from the said public entities.
For purposes of this Law, the term "employee handling public funds" shall also cover any civil servant or employee of a government undertaking who is entitled by the law to contract economic liabilities, authorise expenditure and pay off credits on behalf of, or as the representative of, a State entity or department, or government enterprise.
For the same purposes, any person who, while not being a public officer, collects or pays moneys on behalf of a public entity or, in general, administers assets belong to the same, shall be deemed an agent handling public funds.
Article 18.- For the purposes of this Law, rendering of accounts shall mean that the person referred to in the foregoing Article should provide a report in respect of the funds and assets that he has received, handled, kept in his custody or administered, in a given period of time, and includes the corresponding financial report of the concerned state department. When the Comptroller’s Office considers necessary, it may ask that the corresponding vouchers be sent to it.
Article 19.- When no other term has been indicated for the purpose, all accounts pertaining to funds should be rendered on a monthly basis, within the first fifteen days of the following month.
Article 20.- When the person does not present the statement of accounts along with the supporting documentation and securities, even when the Comptroller’s Office requires him to do so, it shall be presumed that there is a shortfall of the amount in question.
Article 21.- When the circumstances so justify, the Comptroller’s Office may grant an additional period of time, over and above the normal period, in which the accounts may be rendered or the statement may be made available, in cases of non-fulfilment of this obligation due to no fault of the person whose responsibility it is to do so.
Article 22.- The Comptroller’s Office can impose a fine ranging from fifty balboas (B/.50.00) to five hundred balboas (B/.500.00), according to the seriousness of the case, on any person who does not render the accounts or make the statement of accounts available at the required time. In case of recidivism, it can fine him with double the earlier mentioned penalty and if the reoccurrence takes place within the year following the date on which the first fine was imposed, it may ask that the employee be suspended for a period of up to one month.
Article 23.- In case of serious negligence or evident reluctance to comply with the requirements of the previous Article, the Comptroller’s Office shall be entitled to ask that the said employee be dismissed. Such dismissal can be ordered once the facts of the case have been proved.
Article 24.- In order to apply the sanctions contained in the two preceding Articles, the Comptroller’s Office shall frame rules to govern this procedure, and shall determine the manner in which infringements are to be proven.
CHAPTER III
Examination of Accounts
Article 25.- All accounts shall be examined, closed or corrected within a period of one year, starting from the date on which they were received in the Office of the Comptroller General. The Comptroller’s Office must issue a receipt to prove such date to the interested party at his request.
Article 26.- The purpose of the examination of accounts is:
a) To ascertain whether the collection of receipts by the public entity in question and the expenditure or allocation of funds have complied with the relevant legal regulations and, if required, with the applicable administrative or contractual provisions.
b) To check if the operations are true and accurate.
c) To check whether the arithmetical and accounting calculations are correct; and
d) To determine whether the handling of funds has been correct, and if any irregularities are detected, to adopt the necessary measures so that the competent officers or courts can enforce the ensuing responsibilities.
Article 27.- On examining the operations with regard to receipts, the following points should be checked:
a) Whether the settlement of taxes, other contributions and receipts is in keeping with the laws, rules, contracts and other acts that fix their amounts and forms of application;
b) Whether the periods in which such receipts were supposed to be collected have been adhered to;
c) Whether more than the due amount has been charged, or whether the interest, surcharges and fines as laid down by the laws and rules have been charged in case of default in the payment of tax obligations, or obligations of any other nature.
d) Whether the receipts have been correctly imputed in the receipts accounts or, when they do not constitute receipts, in the deposit accounts.
Article 28.- With regard to the examination of statements of expenditure, the following are the main points to be checked:
a) That the vouchers are genuine;
b) That the mathematical and accounting calculations are correct;
c) That the laws on stamp duties and other duties have been complied with;
d) That the expense has been correctly imputed, in such a way that it corresponds to the purpose for which the funds were assigned;
e) That the goods or services have been properly received; and
f) That the expenditure has been recognised and authorised by the officers empowered to do so.
The Comptroller’s Office must conduct investigations to determine whether the product for which public expenditure was incurred corresponds to the sums actually spent.
Article 29.- When the Comptroller’s Office comes across serious irregularities in the handling of public goods and funds that, in its opinion, warrant the suspension of the agent of employee handling the same, it shall request the competent authority to do so and such suspension shall continue for whatever period deemed necessary. In this case, the Comptroller’s Office must state the reasons on which its request is based.
When the circumstances so warrant, the Comptroller’s Office may stop the payment of salaries, remuneration or allowances of any kind that the State or any public entity owes to the agent or employee in charge of handling funds, or to any officer or person who is involved in the irregularities that have been discovered, and shall take any preventive steps required with regard to the assets or funds belonging to such persons or officers, with a view to protecting public interests.
When required, the Office of the Comptroller shall order that the accounts be judged and that the mandatory summary inquiry be instituted.
Article 30.- It is the responsibility of the Office of the Comptroller General, through the concerned department, to see that the accounts are presented at the correct time and in the stipulated manner, as well as to take any steps that might be required in case this obligation is not met or when irregularities are found in the handling of public funds and assets.
Article 31.- The Office of the Comptroller General can examine and review the accounts books and registers, as well as the accounts and documents connected with such books and registers, of any organisation, company, entity or department that directly or indirectly receives monetary aid or subsidies from a public entity. When, as a result of its intervention, it can prove the that irregularities have been committed affecting public wealth, it shall take the necessary preventive steps to protect public interests.
CHAPTER IV
Judgement of Accounts
Article 32.- The Office of the Comptroller General is empowered to judge the accounts maintained by the agents and employees handling public funds and assets, when objections arise at the time of presentation of the same or subsequent to the investigations conducted by the Comptroller’s Office.
Article 33.-The purpose of judging the accounts is to assess the manner in which funds were administered and handled, following a legal-cum-accounting criterion, in order to decide matters relating to responsibility of the concerned public servant or agent vis-à-vis the State.
Article 34.- The judgement of accounts shall follow the procedure laid down in the Judicial Code and the rules framed in this regard by the Office of the Comptroller General.
CHAPTER V
Records and Control of State Property
Article 35.- The Comptroller’s Office shall lay down and maintain a system of effective control of the funds, venal assets and all other types of assets, movable and immovable assets that make up the estate of state entities or that have been entrusted to the public servants working in state entities for safekeeping, care or control.
The departments and offices in charge of maintaining the accounts in the different Ministries, autonomous or semi-autonomous entities, municipalities, town councils, state undertakings, joint ventures and, in general, all enterprises in which a state entity owns part of the capital, shall maintain suitable and up-dated inventories and records of the assets that flow in and out of the estate of the said state departments.
Article 36.- The Office of the Comptroller General shall frame rules containing guidelines pursuant to which the persons handling public funds or assets shall act, and such guidelines will be subject to the relevant legal regulations.
Article 37.- It is the duty of the Office of the Comptroller General to examine and make sure that public funds and other assets actually exist, and to examine the accounts books and records in respect of the same.
Article 38.- The Office of the Comptroller General shall maintain an effective control over all the receipts of the State and other public entities and, to this end, it shall have access to the relevant records and documents.
Article 39.- The Comptroller’s Office shall ensure that all sums that are debited to public offices are deposited promptly into the public treasuries and that, in case of default, the applicable surcharges, interest and fines are charged.
Article 40.- Similarly, the Comptroller’s Office shall see to it that appropriate steps are taken for collection of income belonging to public offices, and that, in case of default, prompt legal action is taken by summary jurisdiction as laid down by the Law.
Article 41.- As part of its duties, the Comptroller’s Office shall oversee and control the tax exemptions granted in accordance with the law or contracts.
Similarly, it shall issue a prior opinion on any applications for refund of amounts paid by way of tax exemptions.
Article 42.- It is the duty of the Office of the Comptroller General to intervene in the process of inventory taking of funds and other assets when one public servant or agent hands over charge to another one replacing him.
Article 43.- The Comptroller’s Office shall take part in the destruction of coins, bonds, public debt titles, venal items and any other related objects or documents, whose destruction is essential according to the Law.
It shall also take part in the destruction of plates, dies and any other instruments or means employed in the production or making of such items or values.
Article 44.- The Office of the Comptroller General shall ensure that the funds and other values deposited in the banks are credited to the National Treasury, in such cases as required by the law.
CHAPTER VI
Inspection of Acts of Handling
Article 45.- The Comptroller’s Office shall endorse or reject the disbursement of public funds and such acts that affect public assets. This requirement need not be complied with when the Comptroller General or the Deputy Comptroller General of the Republic so authorise by a motivated decision after due consideration of the circumstances. The decision to this effect may be revoked at any time when the circumstances so warrant.
Article 46.- The Comptroller’s Office shall be expected to give an opinion on the legal viability and suitability of municipalities and autonomous and semi-autonomous Institutions taking loans in order to achieve the objectives set out for them by the Law.
Article 47.- The Comptroller’s Office shall validate all the bonds, notes, bills and other documents constituting public debt. This function shall be performed by the Comptroller General, the Deputy Comptroller General or by such officer belonging to the Comptroller’s Office assigned for this purpose by the Comptroller General. If this requirement is not fulfilled, the title shall be invalid.
To this end, no public debt document or title shall be put into circulation without having first met this requirement.
Article 48.- The Comptroller’s Office shall validate all the contracts entered into by public entities involving the distribution of funds or affecting their assets. This function need not be carried out in those cases in which the Comptroller’s Office, for justified reasons, considers it unnecessary. This must be stated in a motivated resolution issued by the Comptroller General or the Deputy Comptroller General of the Republic.
Article 49.- The Comptroller’s Office shall keep a record of the appointment of all the public servants, as well as dismissals, leave, vacations and other facts regarding the those public servants who have are involved in the finances of public entities. For this purpose, the head of the respective departments or the public servant to whom this function has been delegated, shall send an authenticated copy of the letter of appointment, or the joining report or any other document as mentioned in this article, to the Office of the Comptroller General or to the department dealing with this matter in the Office.
The Office of the Comptroller General shall not authorise the payment of any salary or remuneration to a public servant whose appointment has not been notified. In such a case, it shall make the relevant observation to the Head of the department concerned.
An officer who is guilty of having made undue payment of salaries shall be responsible for the amount of the same until it is refunded, notwithstanding any penal or disciplinary responsibility that might arise.
CHAPTER VII
Control of Sureties
Article 50.- The Comptroller General shall indicate the amount for the probity bonds to cover the activities of the employees and agents handling public funds, in such cases where the Law has not determined the same. Moreover, it shall be the custodian of all the probity bonds and shall enforce them when the need arises. This function includes the recourse to proceedings and necessary administrative and jurisdictional action, for which the lawyers of this state department shall act according to the instructions of the Comptroller General.
Article 51.-The Office of the Comptroller General shall be the depository of the bonds and shall have the final decision on what amount will suffice as a surety for completion of the obligations contracted with the public entities, in accordance with what is laid down in this Law.
Article 52.- It is part of the duty of the Comptroller’s Office to be the depository of one copy of these deeds giving an affidavit of assets, that public servants must draw up in accordance with the Political Constitution and other legal regulations in this matter.
CHAPTER VIII
National Statistics
Article 53.- The Office of the Comptroller General shall direct and compile national statistics, in accordance with what is laid down for this purpose in the relevant special laws and rules. National Statistics are declared an activity that is for public use and of national interest.
For this purpose, national statistics are understood to be all the processes involved in the collection, preparation, analysis and publication of data pertaining to facts of national or regional interest, the figures of which are structured in such a way that they can be numbered, counted and compared.
Article 54.- In order to fulfil its mission, the Comptroller’s Office shall direct and co-ordinate the statistical activities to be carried out by public entities, in an attempt to see that the results should provide benefits of a general nature.
Similarly, the Comptroller’s Office shall be empowered to solicit information for statistical purposes from entities or public and private persons. When asked to do so, such entities and persons must supply the information requested for this purpose, and the Comptroller’s Office shall be obliged to maintain the secrecy and confidentiality of the information it has obtained.
CHAPTER I
Duties of the Comptroller General
Article 55.- The Comptroller General of the Republic is the highest authority in the Institution and the person who is responsible for its functioning, along with the Deputy Comptroller General. The duties of the Comptroller General, besides those assigned to him by the Constitution and other special provisions, are the following:
a) To plan, direct and co-ordinate the work of the Office of the Comptroller General and, at the same time, represent this Office;
b) To appoint, penalise, suspend and dismiss people working in the institution, in accordance with the relevant legal provisions and rules.
c) To validate the returns, the accounts of the National Treasury, and the contracts entered into by the Nation involving disbursement of public funds or affecting public assets;
c bis) To validate cheques, bonds, notes, bills and other documents constituting public debt;
d) To frame rules and measures regulating presentation and review of public accounts, as well as to frame the internal rules of the Comptroller’s Office.
e) To approve the accounting methods to be used by the government departments indicated in point number 8 of Article 276 of the Constitution and decide the date on which they should come into effect;
f) To order investigations to find out whether the administration of public funds and other assets has been done in the correct manner and in accordance with the established regulations.
g) To send legal notices and file such claims as might be required in the fulfilment of the functions of the Comptroller’s Office. When the law so requires, the Comptroller shall grant a power of attorney to the Lawyers in the Comptroller’s Office for this purpose.
h) To inform the Executive Organ about the financial state of the Public Administration and offer an opinion on the viability and suitability of giving additional or extraordinary credits not included in the budget, as well as to offer an opinion on the acceptance of loans by the Nation;
i) To lay annual reports on the management of the Comptroller’s Office before the Executive Organ and the Legislative Assembly;
j) To prepare and present to the Cabinet Council, along with the Minister of Finance and Treasury, and the Minister of Planning and Political Economy, a plan for cost reduction, when they have reason to believe that the total cash receipts are likely to be less than the authorised expenditure as given in the Budget, so as to avoid the estimated deficit;
k) To order the discharge of public servants and agents handling public funds;
l) To attend the General State Council meetings; to attend the Cabinet Council meetings with the right to speak; and to attend the meetings of any other public body of a national character whose duties relate to the administration of public assets;
m) Pursuant to the requirements set out in the special provisions, to attend the meetings of the Boards of Directors and other corporations governing autonomous and semi-autonomous entities;
n) To appoint the experts to represent the Comptroller’s Office in the proceedings and cases as required by law; and
n bis) Any other duties assigned to him by the law and by the rules. Paragraphs: Except for the duties indicated in paras a), d), f), i) and j) of this Article, the Comptroller General of the Republic may delegate his powers to other officers in the Comptroller’s Office.
CHAPTER II
Duties of the Deputy Comptroller General
Article 56.- The Deputy Comptroller General is the public servant who comes second in the hierarchy after the Comptroller General and, in this capacity, he works together with the Comptroller General in the planning, direction and co-ordination of the functions assigned to the Comptroller’s Office. He is jointly responsible with the Comptroller General for the functioning of the Comptroller’s Office.
Article 57.- The duties of the Deputy Comptroller General are:
a) To replace the Comptroller General when he is absent for reasons of a temporary or accidental nature, as well as to perform the duties of the post when the post is vacant, pending a new appointment;
b) To validate the government contracts, bills, accounts, cheques, bonds and other titles of public debt, in case the Comptroller General is absent or when such powers have been delegated to him;
c) To substitute the Comptroller General in attending the sessions of the Legislative Assembly, the Cabinet Council and the Board of Directors meetings of other corporations governed by decentralised public entities, in the absence of the Comptroller or at his instructions;
c bis) To direct all matters concerning the internal audit functions of the Institution, for which purpose the department in charge of these functions shall be attached to his office.
d) To take cognisance of the audit reports and the financial reports submitted to the Comptroller’s Office by public departments, once they have been cleared by the Director of Auditing. The final approval of these reports is the responsibility of the Comptroller General who may delegate this duty to the Deputy Comptroller General.
e) To authorise the opening of official bank accounts and the setting up of special funds, revolving funds and petty cash accounts, substituting the Comptroller General in accordance with the relevant legal provisions;
f) Any other duties assigned to him by the Law, the Rules and the Comptroller General.
CHAPTER III
Duties of the Secretary General
Article 58.- The Comptroller’s Office shall have a Secretary General whose function shall be to co-ordinate the work of the Institution, and who shall be the channel of communication between the Comptroller General and the subordinate officers and private persons, in all those matters assigned to him by the Comptroller General:
Article 59.- The powers of the Secretary General shall include:
1. To co-ordinate all aspects of the matters that have to be analysed by the Board of Directors.
2. To keep the Comptroller General and the Deputy Comptroller General informed about the matters that are being processed in the Comptroller’s Office.
3. To put his signature on the decisions and decrees issued by the Comptroller General or the Deputy Comptroller General and on the minutes of the meetings of the Board of Directors.
4. To issue as many copies as required of the documents mentioned in the previous point; and,
5. Any other duties assigned to him in the rules or by the Comptroller General.
CHAPTER IV
Departments
Article 60.- The Office of the Comptroller General shall be divided into departments whose names, internal organisation and specific duties shall be laid down in the Internal Rules of the Institution, depending on the field of their competence. However, whenever the need arises to create sub-divisions in the departments, they shall be given specific duties from the beginning, and care shall be taken to see that such sub-divisions limit themselves to dealing only with the matters entrusted to them thus avoiding duplication of functions.
Manuals on procedures shall be brought out to facilitate handling of such matters and to make the tasks as easy as possible to carry out.
Article 61.- Each department shall be headed by a Director who shall be accountable to the Comptroller General and to the Deputy Comptroller General for the progress of the work entrusted to the department headed by him. This person shall be the Chief of the respective department.
When necessary due to reasons of workload, the post of a Deputy Director may be created. A Deputy Director shall assist the Director in the planning, organisation, co-ordination, direction and supervision of the work.
CHAPTER V
Accounts Courts and Tribunals
Article 62.- Pursuant to point 13 of Article 276 of the Constitution, a special jurisdiction of accounts shall be created that shall be in charge of judging the accounts of agents and employees handling funds as and when objections in this matter are raised by the Office of the Comptroller General.
Article 63.- Jurisdiction over accounts shall initially be exercised by a Court of Accounts and a Tribunal of Accounts, whose jurisdiction shall cover the whole Republic and shall be a part of the Office of the Comptroller General. The persons holding office in these courts shall be appointed by the Comptroller General in accordance with what is laid down in the Law.
Article 64.- The Court of Accounts shall be the court of the first instance to hear the trial of accounts and will consist of a Judge, a Secretary and such subordinate staff as may be necessary. To be a Judge of Accounts, the same requirements as stipulated for the post of a circuit judge must be met. Moreover, he must have basic knowledge of accounting and audit.
The Judge of Accounts shall be appointed for a period of six (6) years and this term of office shall start from the very date of his first appointment. He can not be dismissed or substituted except for abandonment of the post, a crime committed in the performance of his duties, negligence or physical or mental incapacity to perform the job.
The Judge of Accounts shall enjoy autonomy and the same rights, responsibilities and prerogatives as those enjoyed by other Judges of the Judicial Organ, with the exception of the right to vacation that shall have to conform to the administrative laws. The remuneration given to the Judge of Accounts shall not be lower than that given to circuit judges.
Article 65.- In the event of any temporary or accidental absence of the Judge of Accounts, he shall be replaced by his substitute. For this purpose, two substitutes shall be designated, the First and the Second, who must meet the same requirements as the main Judge of Accounts. They shall be called upon, in this order, to perform the duties of the Judge of Accounts when necessary. In case, neither the First nor the Second Substitute is able to perform the duties, the Comptroller General shall designate a Special Substitute.
Article 66.- Judgement of accounts shall be tried in the second instance by the Accounts Tribunal, which shall initially consist of the following members:
a) An Accounts Magistrate who shall preside over the Tribunal and who shall have two substitutes to replace him, first the First and then the Second, in the event of his accidental or temporary absence or in case of estoppel or recusation;
b) The Director of Accounts in the Office of the Comptroller General; and,
c) One of the lawyers from the Legal Department of the Office of the Comptroller General, strictly by order of rotation, starting from the Director and continuing downwards in hierarchy.
The term of office of the Accounts Magistrate shall be six (6) years, to be counted starting from the date of his first appointment. During this term he can be suspended or dismissed only by the Comptroller General for any of the reasons mentioned in Article 64 of this Law. In order to occupy this post, the same requirements as those for a Judicial District Magistrate must be met. He must also have basic knowledge of accounts and audit.
The Accounts Magistrate shall enjoy autonomy and have the same rights, prerogatives and responsibilities as the Judicial District Magistrates. The remuneration paid to him shall not be less than that paid to the Judicial District Magistrates and their right to vacation shall be governed by the administrative laws.
The Comptroller General is empowered to designate two additional Accounts Magistrates when justified by the volume of work and public interests. In such an event, the two members of the Accounts Tribunal indicated in sub-paragraphs b) and c) shall cease to perform their regular duties and then this Tribunal shall consist of three Magistrates who will elect one from among themselves to act as the presiding magistrate of the bench.
Article 67.- When the Director of Accounts is estopped or recused, he will be replaced by the Deputy Director who will be chosen by drawing lots from among all the Deputy Directors existing in the Accounts Department.
When there is an estop or challenge against the Lawyer from the Legal Department who is supposed to form part of the Tribunal, he will be replaced by the lawyer who follows him in turn.
If for some reason, there are no more substitutes left to replace a member of the Tribunal, the Comptroller General shall designate a Special Substitute to replace such member.
Paragraph: For purposes of this Article, the causes for recusation and estoppel laid down in the Judicial Code shall be applicable.
Article 68.- Any cases of recusation presented against one member of the Accounts Tribunal shall be decided by the two remaining members.
Article 69.- The Accounts Tribunal shall have a Secretary and subordinate staff in keeping with the requirements, who shall perform the duties assigned to them by the law and the rules.
Article 70.- In any trial pertaining to accounts, the public interest shall be represented, in all instances, by an Auditor designated by the Comptroller General of the Republic for the same term as the Accounts Judge. There shall be two substitutes for the Auditor who will, in turn, replace him in case of temporary or accidental absence.
The Auditor must meet the same requirements as the Accounts Judge and shall have the same rights.
Besides the functions mentioned in this Article, the Auditor shall perform any other duties assigned to him by the Comptroller General that are not in conflict with his main function.
Article 71.- The functions of the Court of Accounts and Tribunal of Accounts, for all legal purposes, are treated at par with those performed by any Judicial Tribunal, and the decisions taken by them shall be of jurisdictional nature. Appeals for cassation of the decisions of the second instance can be taken to the First Division of the Supreme Court of Justice, in accordance with the provisions of the Judicial Code in this matter.
Article 72.- The Office of the Comptroller General of the Republic shall see to it that the General Budget of the State reflects the economic reality of the public sector and that its implementation adheres to the corresponding constitutional and legal norms.
Article 73.- No credit shall be deemed to be finally cleared vis-à-vis the National Treasury or any other public treasury until and unless it has first been approved by the Ministry or by the entity concerned and by the Office of the Comptroller General of the Republic.
Article 74.- Any order for payment issued that is to be charged to the National Treasury or any other public treasury must be submitted to the Office of the Comptroller General for clearance, without which it cannot be paid. In this regard, the Comptroller’s Office shall verify:
a) That such order has been issued in accordance with the legal provisions on the matter;
b) That it is duly charged to the correct head of the budget;
c) That the budgetary head in question has the enough balance available to cover the expenditure;
c bis) That it has been issued in order to pay for goods received or services effectively rendered, save in the exceptions established by the law; and
d) That the beneficiary of the order is the correct person to whom the credit is due.
Article 75.- No employee or agent handling funds who receives or makes payments, or who is responsible for taking care of, safekeeping or controlling public funds or assets, shall be relieved of such responsibility for reasons pertaining to his handling of such funds or assets, except through a release document issued by the Office of the Comptroller General of the Republic.
Article 76.- The Office of the Comptroller General of the Republic is empowered to examine, audit and control the financial transactions of mixed enterprises and any others in which the State has partial financial ownership, municipalities, town councils, government undertakings or autonomous or semi-autonomous institutions. While performing this function, the Comptroller’s Office shall bear in mind the nature of the activity in question and the amount of financial participation of public entities in such activities.
Article 77.- The Comptroller’s Office can reject any payment order against the public treasury and any administrative acts that might affect public property, provided such rejections are based on reasons of a legal or economic nature warranting such a step. In case the officer or body issuing the payment order or the administrative act insists that one or the other be necessarily complied with, the Comptroller’s Office must comply or, otherwise, it must ask the Court dealing with suits under administrative law of the Supreme Court of Justice to give an opinion on the legal viability of the payment or compliance with the act.
Notwithstanding what has been stipulated in the previous paragraph, the officer or body responsible for issuing the order, after it has been rejected by the Comptroller’s Office, can also bring the situation that has arisen to the notice of the Cabinet Council, the Board of Directors, the Executive Committee, the Executive Council, Board of Trustees or any other administrative body that, depending on the case, exercises the maximum administrative authority in the Institution, so that such authority may decide whether issuing the act or compliance with the order can be insisted upon or not. In case the body concerned decides that the act must be issued or the order must be complied with, the Comptroller’s Office will have to endorse it, but any liability arising from the same shall devolve, jointly and solidarily, on the members of such body that voted in its favour. In case of a negative decision the officer and the body that issued the act or the order shall abstain from insisting that it be endorsed.
Article 78.- Every meeting of a Board of Directors, committee, executive council, executive board and, in general, any body that is responsible for the administration and handling of public funds or assets shall be attended by a representative of the Office of the Comptroller General of the Republic designated by the Comptroller General, who shall have the right to speak in the meetings held by such bodies.
Article 79.- No public servant belonging to the Office of the Comptroller General can protect and further his own financial interests nor those of a family member within the first degree of relationship and the second degree of blood relationship.
Being a civil servant is not in conflict with holding a post in the field of education, nor with the exercise of professional activities as defined by this Article and within the limitations set out on this subject by the Constitution or the Law.
Article 80.- Any person who has served in a government department for at least twenty-eight (28) years, fifteen (15) of which were spent working in the Office of the Comptroller General, shall have the right to retire with the last remuneration received in the Comptroller’s Office, provided he or she has reached the age of fifty-five (55) years or more.
Article 81.- All public servants shall render their co-operation to the Office of the Comptroller General whenever required in the performance of its duties, and shall provide the reports, documents, records and other elements of judgement required for such purpose.
The Comptroller General and the Deputy Comptroller General may impose a fine of up to one hundred balboas (B/.100.00) on any public servant who violates the above mentioned regulation. They may also impose this fine when, in the performance of their duties, a public servant or a private individual disobeys their orders or does not show the due respect, according to the relevant legal regulation.
Article 82.- In the course of investigations being carried out by the Office of the Comptroller General of the Republic, it may resort to all the means of proof and the procedures permitted under the prevailing legal norms. Similarly, it may ask for assistance from the national and municipal authorities, and even adopt legal measures as warranted by the circumstances.
Article 83.- The Office of the Comptroller General of the Republic shall be a party involved in all trials in which illegality or unconstitutionality of one of its acts is alleged; for such purposes, the Comptroller General may execute a special power in favour of a lawyer belonging to the Legal Department.
Article 84.- This law shall come into force from the time it is promulgated and revokes Law 6 of 1941 and all provisions that are contrary to it.
