GOVERNMENT ACCOUNTING RESPONSIBILITY,

PRELIMS REVIEWER ACCOUNTABILITY, AND

LIABILITY OVER GOVT FUNDS
CHAPTER 1: Overview of AND PROPERTY
Government Accounting
Responsibility of Government
GOVERNMENT ACCOUNTING Funds and Property
- Encompasses the processes
of analyzing, recording,  Utilized efficiently and
classifying, summarizing and effectively
communicating all
transactions involving the Head of the government
receipt and disposition of agency – responsible in
government funds and implementing this policy and
property, and interpreting the primarily responsible for
results thereof government resources entrusted to
his agency
Objectives of government
accounting:  All those who are exercising
authority over a govt agency
a. Produce information shall share fiscal
concerning past operations responsibility
and present conditions
b. Basis for guidance for future Accountability over Government
operations Funds and Property
c. Provide for control of the acts
of public bodies and officers  Govt officer entrusted with
in the receipt, disposition and the possession is responsible
utilization of funds and for the safekeeping
property
d. Report on the financial  Transfer of government
position and the results of funds from one officer to
operations of government another shall be made only
agencies after the authorization of the
COA
Government accounting places
greater emphasis: Liability over Government Funds
 Sources and utilization of and Property
government funds
 Responsibility, accountability  Unlawful use shall be the
and liability of entities personal liability of the
entrusted with govt funds employee found guilty
and properties
 Every accountable officer
Sources of govt funds: receipts shall be liable for all losses
from taxes and other fees, resulting from unlawful use or
borrowings, and grants from other negligence
govt and international bodies
 No accountable officer shall
Utilization of govt funds: be relieved from liability
expenditures on programs, because he acted under the
projects, unanticipated losses direction of a superior officer
 o Unless, he notified the - Directly implementing the
superior officer in projects of, and performing
writing that utilization the functions delegated by
is legal the government
o Superior officer shall be
primarily responsible
Entity – government agency,
 Accountable officer shall department or operating/field unit
notify COA for any loss of
govt funds within 30 days Financial Reporting – process of
ACCOUNTING RESPONSIBILITY preparation, presentation and
submission of GPFS and other
1. Commission on Audit reports

a. Promulgate accounting and GOVERNMENT ACCOUNTING

auditing rules and regulations MANUAL FOR NATIONAL
b. Keeps general accounts of GOVERNMENT AGENCIES (GAM
the government for NGAs)
c. Submits financial reports to
the President and Congress  Harmonize the govt
accounting standards with
2. Department of Budget International Public
and Management (DBM) – Section Accounting
formulation and Standards (IPSAS)
implementation of the
national budget with the goal Legal basis: promulgated by COA
of attaining the nation’s
socio-economic objectives Coverage:
 General purpose FS in
3. Bureau of Treasury (BTr) – accordance with IPSAS
under DOF and cash  Reporting of budget, revenue,
custodian of the government an expenditure in accordance
with laws, rules and
a. Receive and keep national regulations
funds and manage and
control the disbursements Objective:
b. Maintain accounts of financial a. Standards, policies,
transactions of all national guidelines, and procedures
government offices b. Coding structure and
accounts
Government agencies – c. Accounting books, registries,
department, bureau or office of the records, forms, reports and
national government, or any of its FS
branches and instrumentalities or
political subdivisions BASIC ACCOUNTING AND
BUDGET REPORTING
PRINCIPLES

1. Philippine Public Sector

Accounting Standards
(PPSAS)
2. Accrual basis of accounting
3. Budget basis
 4. Revised Chart of Account
(COA) Prudence – exercise of degree of
5. Double entry bookkeeping caution when making estimates
6. FS based on accounting and under conditions of uncertainty
budgetary records
7. Fund cluster accounting Completeness – complete within
the bounds of materiality and cost

Comparability – identify similarities

and differences between that
information and information in
other reports

QUALITATIVE COMPONENTS OF GENERAL

CHARACTERISTICS: PURPOSE FINANCIAL
STATEMENT
Understandability – users can
reasonably be expected to  Statement of financial
comprehend its meaning position
 Reasonable knowledge  Statement of financial
and willingness to study performance
 Statement of Changes in
Relevance – assist users in Equity
evaluating past, present, or future  Statement of Cash Flows
events or in confirming or  Statement of Comparison of
correcting past evaluations Budget and Actual Amounts
 Notes to FS
Materiality – its omission or
misstatement could influence the
decisions of users

Timeliness – loses its relevance if

there is undue delay in it reporting

Reliability – free from material error

and bias, and can be depended on
by users to represent faithfully

Faithful Representation – presented

in accordance with the substance
of the transactions and other
events, and not merely their legal
form

Substance over Form – represent

faithfully the transactions and
other events that it purports to
represent

Neutrality – free from bias and not

be selected or presented in a
manner that is designed to
influence the user’s decision
  Increase participation of
citizen-stakeholders

Budget call – DBM issues that to

all government agencies
- Contains the next fiscal
year’s targets, agency’s
budget ceiling, and other
GOVERNMENT ACCOUNTING guidelines
PRELIMS REVIEWER
Relevant terms:
CHAPTER 2: Budget Process
Balanced budget – estimated
THE NATIONAL BUDGET revenues exceed estimated
expenditures (surplus or deficit)
 Government accounting is
primarily budgetary Annual budget – covers a period of
accounting one year and forms the basis for
 Government funds to be the annual appropriation
utilized in accordance with a
national budget that is duly Special budget – items not
approved by legislation adequately covered or not included
in the general appropriations act
National budget
- Government’s estimate of Line item budget – salaries and
the sources and uses of wages, travel expenses, freight,
government funds within a supplies, materials and equipment
fiscal year
- Summarized in the budget Performance budget – plan of
cycle activities to be undertaken (related
costs)
Four Phases of the Budget - Work to be done or services
Cycle to be rendered

A.Budget Preparation Obligation budget – expenditures

incurred in the current year which
 Philippine uses bottom up are to be paid either in the same
approach – starting from the year or following year
lowest to the highest levels
of the government Budget hearings – each agency
defends its budget proposal before
the DBM who deliberates the
budget proposals, make Bicameral Deliberations –
recommendations and consolidates formed to harmonize any conflicts
into the National Expenditure between the Representatives and
Program (NEP) and Budget of Senate versions of GAB
Expenditures and Sources of
Financing (BESF) President’s enactment – enacts
General Appropriations Act (GAA)
Presentation to the Office of - May exercise his veto power
the President – pres and cabinet as conferred to him under the
members review the proposed PH constitution
budget
APPROVED BUDGET –
 DBM finalizes the budget expenditure authority derived from
documents to be submitted appropriation laws, government
to the Congress ordinances, and other decisions
 Proposed budget – related to the anticipated revenue
President’s Budget or receipts for the budgetary period

a. President’s Budget Message –

explanation of the country’s
fiscal policy and budget
priorities

b. National Expenditure
Program – details of all the
govt entities’ proposed
expenditures in the coming
Appropriation – authorization made
year
by a legislative body to allocate
funds for purposes specified by the
c. Budget of Expenditure and
legislative or similar authority
Sources of Financing -
estimated expenditures with
1. New General Appropriations –
estimates of expected
annual authorizations for
sources of financing
incurring obligations during a
specified budget year
d. Other documents
2. Continuing Appropriations –
B.Budget Legislation
authorizations to support
obligations for a specific
House Deliberations – HoR
purpose or project
conducts hearings to scrutinize the
various agencies’ respective
3. Supplemental Appropriations
proposed programs and
– additional authorized by law
expenditures
to augment the original
- General Appropriations Bill
appropriations which proved
(GAB)
to be inefficient

Senate Deliberations – normally

4. Automatic Appropriations –
start after the Senate receives the
authorizations programmed
GAB, hearings in the Senate start
annually or for some other
even as Representatives
period prescribed by law
deliberations are ongoing
 which do not require periodic  Estimate of monthly income
action by Congress  List of obligations that are
not yet due and demandable
5. Unprogrammed Funds –
standby appropriations Major Recipients of the budget:
authorized by Congress in the
annual GAA 1. National Government
Agencies (executive,
 Revenue collections legislative, judicial branches
exceed original of government)
revenue targets
 New revenues are 2. Local Government Units
collected or realized (autonomous regions,
 Newly-approved provinces and cities,
loans for foreign- component provinces, and
assisted projects are barangays)
secured
3. Government Owned and
6. Retained Income/Funds – Controlled Corporations
collections which are
authorized by law to be used Allotment – DBM formulates
directly by agencies Allotment Release Program (ARP)
concerned for their operation to set the limit for allotment
or specific purposes releases during the upcoming year
- Control device to ensure that
7. Revolving Funds – business releases conform to the
type activities of national budget
departments/agencies
o Self liquidating and all Allotment – authorization issued by
obligations and the DBM to incur obligations for
expenditures shall be specified amounts contained in a
charged against the legislative appropriation in the form
fund (business type) - Obligational authority

8. Trust Receipts – receipts by a Obligation – act of a duly

govt agency acting as authorized official which binds the
trustee, agent or government to the immediate or
administrator for fulfillment eventual payment of a sum of
of some obligations or money
conditions
Incurrence of Obligations – paid
C.Budget Execution (government by the government; entering into
funds are spend) contracts, hiring of personnel,
purchase of supplies
Release guidelines and BEDs –
DBM issues guidelines on the Disbursement Authority – where
release and utilization of funds govt agencies obtain access to the
while various agencies submit their government funds
Budget Execution Documents
(BEDs) Following documents in releasing
disbursement authority:
 Physical and financial plan
 Monthly cash program
 1. Notice of Cash Allocation b. Quarterly Physical Report of
(NCA) – issued by the DBM to Operation
central, regional and
provincial offices and c. Statement of Appropriations,
operating units to cover their Allotments, Obligations,
cash requirements Disbursements and Balances
o Based on the monthly
submitted Monthly d. Summary of Appropriations,
Cash Program Allotments, Obligations,
Disbursements and Balances
2. Notice of Transfer of by Object of Expenditures
Allocation – issued by Central
Office to its regional and e. List of Allotments and Sub-
operating units to cover the Allotments
latter’s cash requirements
f. Statement of Approved
3. Non-cash Availment Authority Budget, Utilizations,
– cover the liquidation of Disbursements and Balances
their actual obligations
incurred against available g. Summary of Approved
allotments Budget, Utilizations,
Disbursements and Balances
4. Cash Disbursement Ceiling – by Object of Expenditures
issued to agencies with
foreign operations allowing h. Quarterly Report of Revenue
them to use the income and Other Receipts
collected by their Foreign
Service Posts to cover their i. Aging of Due and
operating requirements Demandable Obligations

o Checks – modified
Consolidated Statement of
disbursement
Allotments, Obligations, and
system (MDS)
Balances per Summary of
checks
Appropriations -> submitted on
or before February 14 of the
following year

Performance reviews – periodic

reviews of the agencies’
performance and budget
accountability and report to the
President
D.Budget Accountability
Audit – COA audits the agencies
Budget Accountability Reports
RESPONSIBILITY ACCOUNTING
a. Monthly Report of - System of providing cost and
Disbursements – submitted revenue information over
to COA and DBM within 30 which a manager has direct
days after the end of each control of
month - Evaluation of manager’s
performance
 - Requires the identification of  Check disbursements
responsibility centers and journal
distinction between
controllable and non- 2. Ledgers
controllable costs  General Ledgers
 Subsidiary Ledgers
Responsibility centers – part,
segment, unit or function of a 3. Registries
government agency, headed by a  Registries of Revenue and
manager, who is accountable for a Other Receipts (RROR)
specified set of activities  Registry of Appropriations
and Allotments (RAPAL)
Controllable costs – controllable at  Registries of Allotments,
a given level of managerial Obligations and
responsibility if the manager has Disbursements (RAOD)
the power to incur it  Registries of Budget,
Utilization and
Non-controllable costs – cost Disbursements (RBUD)
incurred indirectly and allocated to
a responsibility level Journals and ledgers – accounting
records
Registries – budget records

 Accounting unit maintains

journal and ledgers
 Budget division maintains the
registries

BUDGET REGISTRIES

1. Registries of Revenue and

Other Receipts (RROR) –
monitor the budgeted amounts,
actual collections and
remittances of revenue and
other receipts

2. Registry of Appropriations
and Allotments (RAPAL) –
GOVERNMENT ACCOUNTING monitor appropriations and
PRELIMS REVIEWER allotments
3. Registries of Allotments,
CHAPTER 3: Government Obligations and
Accounting Process Disbursements (RAOD) –
monitor the allotments
BOOKS OF ACCOUNTS AND received, obligations incurred
REGISTRIES against the corresponding
allotment, and the actual
1. Journals disbursements made
 General journal
 Cash receipts journal Separate ROAD maintain for each
 Cash disbursements object of expenditure:
journal
 a. Personnel services (PS) – all
types of employee benefits

b. Maintenance and Other

Operating Expenses (MOOE)
– various operating expenses
other than employee benefits
and financial expenses
Disbursement Authority –
c. Financial Expenses (FE) –
Notice of Cash Allocation (NCA)
pertain to finance costs
(interest expense, bank
Registries used to monitor the
charges)
NCA:

d. Capital Outlays (CO) – pertain

a. Registry of Allotments and
to capitalizable expenditures
Notice of Cash Allocation
(RANCA) – determine the
4. Registries of Budget,
amount of allotments not
Utilization and
covered by NCA and monitor
Disbursements (RBUD) –
the available balance of NCA
record the approved special
budget and corresponding
b. Registry of Allotment and
utilizations and disbursements
Notice of Transfer of
charged to retained income
Allocation (RANTA) –
determine the amount of
INCURRENCE OF OBLIGATION
allotments not covered by the
Notice of Transfer of Allocation
Obligation Request and Status
(NTA) and monitor the available
(ORS) – obligations shall be
balance of NTA
incurred through the issuance
JOURNALS:
Notice of Obligation Request
and Status Adjustment
a. General Journal – record
(NORSA)
transactions not recorded in
the special journals
 If obligations recorded in the
RAOD and ORS need to be
Special Journals:
adjusted, the subsequent
adjustment
a. Cash Receipts Journal –
record the Report of
Journal entries shall be made only
Collection and Deposit and
after:
Cash Receipts Register of
a. Employees have rendered
collecting officers
services
b. Office supplies are delivered
Report of Collection – collecting
and received
officer to report his collections and
c. Office equipment is delivered
deposits to an authorized
and received
government depository bank
(AGDB)
Not Yet Due and Demandable –
obligations in the registries (not yet
Cash Receipts Register (CRReg) –
in accounting books)
field offices without a complete set
of books to record their cash
collections and deposits in the SUMMARY OF BASIC
books of their mother unit RECORDINGS

b. Cash Disbursements
Journal – cash
disbursements of the
disbursing officer

c. Check Disbursements
Journal – check
disbursements of the
disbursing officer

LEDGERS

a. General Ledger –
summarizes all transactions
recorded in the journals

b. Subsidiary Ledgers –
details of each control
account in the general ledger

TAX REMITTANCE ADVICE (TRA)

Revised Chart of Accounts
 Books of govt agencies:
(issued by COA)
constructive remittance of
taxes withheld to the BIR or
Chart of Accounts – list of all
custom duties withheld to the
accounts used by an entity
BOC
Books of the BIR and BOC:
constructive receipts of tax
revenue and custom duties
Books of the BTr: constructive
receipt of taxes and customs
duties remitted

Reversion of Unused Notice of

Cash Allocation (NCA)

GOVERNMENT ACCOUNTING
CYCLE

1. Appropriation
2. Allotment
3. Incurrence of Obligation
4. Disbursement Authority –
NCA
 5. Disbursements
6. Billings, Collections & CHAPTER 4: Revenues and
Remittances Other Receipts
7. Unadjusted Trial Balance
8. Adjusting Entries REVENUE – gross inflow of
9. Closing Entries economic benefits or service
10. Preparation of FS potential during the reporting
period when those inflows result in
an increase in equity
- Only those received or
receivable by the entity

Receipts – actual cash collections

from all sources during a period

Fundamental Principles for

Revenue

a. All revenues shall be remitted

to National Treasury and
included in the General
Fund of the National
Government

b. All moneys and property

received by a public officer
shall be accounting for as
government funds and
government property, unless
otherwise

c. Amounts received in trusts

and from business-type
activities of the government
may be separately
recorded and disbursed

d. Receipts shall be recorded as

revenue of Special,
Fiduciary, or Trust Funds,
or Funds other than General
Funds only when authorized
by law

e. A collecting officer shall

immediately issue an official
receipt upon collecting
payment

f. Mechanical devices are used

to acknowledge cash
GOVERNMENT ACCOUNTING receipts, the COA may
PRELIMS REVIEWER approve the exemption
 programs and projects and not
g. Temporary receipts shall under accountability of any
never be used or particular govt agency/office or unit
acknowledged
SOURCES OF REVENUE
h. Pre-numbered Ors shall be
issued in strict numerical a. Exchange Transactions –
sequence one entity receives assets or
services, or has liabilities
i. A collecting officer shall extinguished, and gives equal
accept payments to the value
government, in form checks b. Non-exchange
and shall not use govt funds transactions – entity either
to encash private checks receives value from another
entity without directly giving
j. Receipts of govt funds shall equal value in exchange
be acknowledged in
accordance with the law  Not immediately clear, the
substance of the transactions
shall be examined to
TYPES OF FUNDS
determine its type
 Receipt of trade discounts,
General fund – available for any
quantity discounts does not
purpose
necessarily mean that the
transaction is a non-
Special fund – designated for
exchange transaction
special purposes

EXCHANGE TRANSACTIONS:
Trust fund (Fiduciary fund) –
held a government agency or
1. Sale of Goods or Provisions of
public officer
Services to third parties or
other govt agencies
Revenue fund – all funds derived
 Service
from the income of any govt
income/business
agency
income

Depository fund – authorized

2. Use by other entity of assets
depository bank over which the
yielding interest, royalties
recipient agency retains control
and dividends or similar
distributions
Special account in the General
 Interest income – use of
Fund – funding of priority activities
cash or cash
of the govt
equivalents
 Royalties – paid use of
a. All income and collections for
entity’s assets
Special and Fiduciary Funds
 Dividends – capital
b. Automatically appropriated
investments in GOCCs
for purposed authorized by
law
Recognition of Revenue
c. To the approval of the
President
Sale of Goods:
 Does not retain continuing
Special Purpose Funds (SPFs) –
managerial involvement
President allocates for special
  Probable economic benefits i. FV of goods/services
 Revenue measured reliably received, adjust by
 Costs related measured cash transferred
reliably ii. FV of goods/services
given up, adjust by
Rendering Services cash transferred
 Straight line basis
 Reference to the stage of NON-EXCHANGE
completion TRANSACTIONS:

i. Stage of completion Taxes – compulsory payments

measured reliably intended to provide revenue to the
ii. Probable economic benefits government
iii. Revenue measured reliably
iv. Cost measured reliably Fines and penalties – monetary
sanctions as consequence of law
 Outcome cannot be
estimated reliably, revenue is Gifts, Donations, and
recognized only to the extent Goods/Services In-kind – voluntary
of the expenses recognized transfers, normally free from
stipulations
Interest, Royalties & Dividends Recognition of Revenue from
Non-Exchange Transactions
 Interest – time proportion
basis that takes into effect o Recognized on a cash bash
the effective yield basis until a reliable
 Royalties – when they are measurement model is
earned (substance of developed
relevant agreement)
 Dividends – entity’s right to Tax Revenue
receive payment is  Recognized at a gross
established amount and not reduced for
expenses paid through the
Measurement of Revenue from tax system
Exchange Transactions
Expenses paid through tax system
FAIR VALUE – asset could be – expenses should be paid
exchanged, or a liability settled, irrespective of whether the
willing parties in an arm’s length taxpayer pays taxes
transaction
 Not be gross up for the
Accounts Receivable xxx amount of tax expenditures
Sales Revenue
xxx Tax expenditures – preferential
provisions of tax law that provide
Exchange of Goods or Services certain taxpayers that are not
available to others
a. Similar nature and value do - Foregone revenue
not give rise to revenue
b. Dissimilar nature and value
gives rise to revenue:
 - Transfers made according to
the provisions of a deceased
person’s will

Grant with Conditions

- Initially recognized as liability
and recognized as revenue
only when the condition is
satisfied
Transfers
- Inflows of future economic Pledges
benefits or service potential - Unenforceable undertakings
from non-exchange to transfer assets to the
transactions recipient entity
- Fines, gifts, donations, and - Not recognized as revenue
goods and services in-kind, because they do not meet
debt forgiveness, bequests, the recognition criteria for
and grants asset

Fines and Penalties Concessionary Loans

- Recognized as income in the - Loans received by an entity
year they are collected at below market terms

Gifts, Donations, and Goods In-Kind Impairment Losses and

- Revenue when it is probable Allowance for Impairment
that economic benefits or Losses
service potential will flow to  An amount already
the entity recognized as revenue
become uncollectible, it is
recognized as expense rather
Services In-Kind than an adjustment to the
- Not recognized as revenue revenue originally recognized
due to the uncertainties
affecting the entity’s ability Other Receipts:
to control those services and
measure them at fair value a. Receipt of subsidy from the
National Government
Measurement from non-  Notice of Cash Allocation
exchange transactions: (NCA)
 Tax Remittance Advice
a. Assets – FV  Non-Cash Availment
b. Liabilities – present value Authority
c. Revenue – amount of  Cash Disbursement
increase in net assets Ceiling

Debt Forgiveness b. Receipt of subsidy or assistance

- Lender cancels the debt of from other govt agencies
the govt entity, the debtor
recognizes revenue equal to  Collecting officer shall issue
the CA of debt forgiven an official receipt (OR)

Bequests
c. Receipt of excess cash advance
granted to officers and
employees

d. Receipt of refund of
overpayment of expenses

e. Receipt of performance bond or

security deposit

Performance bond – security

deposit required from a contractor
or supplier to guaranty the full and
faithful performance of a contract

f. Collections made on behalf of

another entity

g. Intra-agency and Inter-agency

fund transfers

GOVERNMENT ACCOUNTING
PRELIMS REVIEWER

CHAPTER 5: Disbursements

DISBURSEMENTS
- Constitute all payments in
cash, in whatever manner
- Supported by Disbursement
Vouchers or Payroll

Fundamental Principles for

Disbursement of Public Funds

a. All government resources shall

be used in accordance with the
law and only for public
purposes
b. Trust funds shall be used only the completeness of the
for their specific purpose supporting documents
c. Fiscal responsibility shall be
strictly shared by all those  All disbursements require the
exercising authority over a govt certification of the Chief
agency Accountant
d. Use of government resources  Valid and properly authorized
shall be approved by property claims
officials
e. Claims against government d. Requesting and approving
funds shall be supported with officials shall ensure that the
complete documentation disbursements are legal
f. All laws and regulations
applicable to financial e. The Head of Requesting Unit
transactions shall be faithfully shall certify the necessity and
adhered to legality of disbursements

 Expenditures funded  Disbursement vouchers and

borrowings are included in payroll
the expenditure program of
the entity f. Head of Agency shall approve
all DVs or Payrolls
AUTHORITY TO DISBURSE/PAY
a. Notice of Cash Allocation MODES OF DISBURSEMENT S
(NCA)
b. Notice of Transfer of 1. CHECK
Allocation (NTA) 2. Cash
c. Tax Remittance Advice (TRA) 3. Cashless payments
d. Non-Cash Availment o Advice to debit account
Authority (NCAA) (ADA)
e. Cash Disbursement Ceiling o Electronic modified
(CDC) – issued by the DBM to disbursement systems
agencies with foreign (eMDS)
operations, allowing them to o Cashless purchase card
use the income collected by system (Credit card)
their Foreign Service Posts o Non-cash availment
(FSPs) authority (NCAA)
o Tax remittance advice
(TRA)
BASIC REQUIREMENTS &
CERTIFICATIONS FOR
DISBURSEMENTS Disbursements through Check

a. Budget Officer – certify the Two types of checks issued by

availability of allotment government agencies:

b. Chief Accountant – charge a. Modified Disbursement

obligations against available System Checks – chargeable
allotment against the account of the
Treasurer
c. Chief Accountant – certify the
availability of funds/cash and b. Commercial Checks –
chargeable against the
 Agency Checking Accounts previous cash advance is
with GSBs liquidated

 Checks (released or f. Transfer of cash advance is

unreleased) are recorded prohibited
chronologically
g. Cash advance shall not be
Disbursements through Cash used to encash checks or to
liquidate a previous cash
a. Cash advances shall be made advance
only for a legally authorized
specific purpose
Disbursements through Advice
to Debit Account (ADA)
b. Cash advances shall be given
only to duly appointed
List of Due and Demandable
disbursing officers who
Accounts Payable – Advice to Debit
must be properly bonded
Accounts (LDDAP – ADA)

c. Only designated disbursing

- Accountable form used as an
officers are allowed to
authorization issued by a
perform disbursing functions
government agency to the
and only permanently
MDS-GSD instructing the
appointed officials shall be
bank to debit a specified
designated
amount from its available
NCA
d. Cash advance liquidated as
soon as the purpose for
 One ADA can be drawn to
which it was given has been
pay various payees, maintain
served
accounts in the same bank
where the ADA is drawn
Payroll – within 5 days after the end
of the pay period - Authorization for a fund
 Unclaimed salaries shall be transfer or a bank transfer
refunded and issued OR to from the issuing agency’s
close the account NCA bank account to the
bank accounts of specified
Travel payees
 Local – within 30 days upon
return to personnel’s Following not paid through ADA:
workstation  Payment of terminal leave
 Foreign – within 60 days upon and retirement gratuity
return to the Philippines benefits
 Remittance of GSIS,
 No official or employee is PhilHealth, and Pag-IBIG
allowed to go on an official contributions
foreign travel if he is due to  Payment to utility
retire within 1 year after companies
foreign travel  Other payables which
cannot be conveniently nor
e. No additional cash advance practicably paid using the
shall be given to any official ADA
or employee unless the
Disbursements through items (not available with the
electronic Modified procurement service)
Disbursement System
g. Unauthorized items
- Disbursements are made purchases shall be the
directly from the accounts of personal liability of the
the BTr that are maintained cardholder
with the Land Bank of the
Philippines h. Participating agencies shall
immediately inform the
Disbursements through Citibank of any discrepancy
Cashless Purchase Card (CPC)
System i. Participating agencies shall
ensure timely payment of
- Use of electronic card CPC billings
- Citibank o Late charges personal
liability of responsible
a. Purchases shall be only for o NCA never used to pay
specific eligible items and late payment charges
only with specific merchants
j. Cardholder shall submit all
Merchants – sellers or suppliers receipts from use of the CPC
authorized by Citibank to the accounting unit

b. Only authorized individuals k. Accounting unit shall check if

shall be allowed to use the the procured items are those
CPC, subject to monthly allowed by law and compare
credit limits charge slips
o Approval of the
Steering Committee l. In case CPC is lost or stolen,
immediately notify the
c. Agency officials approved the Program Administrator
CPC are jointly accountable and the Citibank
with the cardholders
o PA determine whether
d. Comply to, and shall not in cardholder was
any way change, the existing negligent and if
disbursement policies and privileges shall be
procedures prescribed under reinstated or
the law permanently
suspended
e. Amount covered shall form o Cardholder liable for
part of the cash advance CPC charges during the
levels of the participating period card was stolen
agencies
Disbursements through Non-
 Not be used to justify the Cash Availment Authority
increase in cash advance (NCAA)
levels of participating
agencies - Issued by the DBM to
agencies to cover the
f. Used for purchases of small liquidation of their actual
value, non-common use obligations incurred against
 available allotments for
availments of proceeds from
loans/grants through
supplier’s credit/constructive
cash

 Direct payment method /

direct payment scheme of
loan availment

Disbursement through Tax

Remittance Advice (TRA)
- Constructive remittance of
taxes or customs duties
withheld to the BIR or BOC

ACCOUNTING FOR
DISALLOWANCES

Disallowances – expenditures
made by an agency that are
subsequently invalidated or
disallowed by COA
- Irregular, unnecessary,
excessive, extravagant, or
unconscionable
- Recorded only when final and
executory

ACCOUNTING FOR
OVERPAYMENTS

 Refunds shall be demanded

of the employees concerned
 Correcting entries are similar
to the accounting for
disallowances