Updates on Accounting

and Auditing Reforms

LOURDES M. CASTILLO
Assistant Commissioner
Government Accountancy Sector
Commission on Audit

Delivered during the 35th ANC of the

Government Association of Certified Public Accountants
Crown Regency Suites and Residences
April 17-20, 2013
1

Topical Outline
1. COA-DBM Joint Circular No. 2013-1
dated March 15, 2013

Revised Guidelines on the Submission of

Quarterly Accountability Reports on
Appropriations, Allotments, Obligations and
Disbursements
2. COA Circular No. 2013-002
dated January 30, 2013

Adoption of the Revised Chart of Accounts for

National Government Agencies

3. COA Resolution No. 2013-007 dtd. January 29, 2013

Adoption of the Philippine Public Sector Standards for
Auditing
4. COA Circular No. 2012-005 dtd. December 07, 2012
Revocation of COA Circular No. 2009-008 dated
November 9, 2009 and Prescribing the Use of Punong
Barangays Certification (PBC) and COA Auditors
Advice (CCA)

5. COA Circular No. 2012-004 dtd. November 28, 2012

Demand for the Immediate Liquidation and Settlement
of All Cash Advances Outstanding as of December 31,
2011
3

Revised Guidelines on the Submission

of Quarterly Accountability Reports on
Appropriations, Allotments, Obligations
and Disbursements

Legal Basis
COA-DBM Joint Circular No. 2013-1
dated March 15, 2013

Rationale
The DBM and COA, as oversight agencies on Financial
Management require agencies to submit on a regular
basis, Budget and Financial Accountability reports.
The DBM uses the budget and accountability reports in
monitoring the agencies performance and providing the
President and other fiscal agencies, the necessary
information for policy making.

The COA uses the data in the Financial Statements to

prepare the Annual Financial Report of Allotments,
Obligations and Disbursements being submitted to the
President and Congress, pursuant to R.A. 7226 dtd.
March 12, 1992.

Purpose
1. To prescribe harmonized formats of the
financial accountability reports (FAR) on
appropriations, allotments, obligations,
disbursement authorities, disbursements and
balances; and
2. To prescribe guidelines on the preparation and
timely submissions of FARs by the agencies to
the DBM and the COA after the end of each
quarter.
7

Coverage
The Circular covers all departments, bureaus,
offices and agencies of the national government
and government-owned and/or controlled
corporations maintaining Special Accounts in
the General Fund.

Definition of Terms
1. Appropriation an authorization made by law or other
legislative enactment, directing the payment of goods and
services out of government funds under specified
conditions or for specified purposes.
2. Allotment a specific authority in the form of Agency
Budget Matrix (ABM) or Special Allotment Release Order
(SARO) issued by DBM to identified agencies to incur
obligations not exceeding a given amount during a
specified period for the purpose indicated therein.
9

3. Sub-Allotment a specific authority in the form of SubAllotment Release Order (Sub-ARO) issued by the Central Office
(CO)/Regional Office (RO) of a department/office/agency to its
ROs/lower operating units (i.e. field office, district office or
provincial office ) which allow them to incur obligations within a
specified amount during a specified period. The Sub-ARO should
not exceed the allotment releases to the CO.
4. Obligation a commitment by the government agency arising
from an act of a duly authorized official which binds the
government to the immediate or eventual payment of a sum of
money. The agency is authorized to incur obligations only in the
performance of activities which are in pursuit of its functions and
programs authorized in the appropriation acts/laws within the
limit of the allotment released by the DBM.
10

7. Commitment an obligation incurred by

government agencies for which items have not yet
been delivered and services not yet rendered. This is
also called Obligations Not Yet Due and
Demandable.
8. Unpaid Obligation this is the balance of an
accounts payable or commitment.
9. Operating Unit a national government agency or
a unit thereof receiving direct release of a Notice of
Cash Allocation (NCA) from the DBM.
11

Guidelines
A. The head of each operating unit (OU), office or agency shall be
responsible for the timely submission, either physically or
electronically, the following FARs to the DBM and COA (Audit
Team Leaders and the Government Accountancy Sector (GAS)
not later than the 30th day after the end of each quarter:
1. Statement of Appropriations, Allotments, Obligations
Disbursements and Balances (SAAODB)
2. List of Agency Budget Matrix (ABM) or SAROs and
Sub-AROs

3. Detailed Statement of Current Years Obligations,

Disbursements and Unpaid Obligations (SODUO-CY)
4. Summary of Prior Years Obligations, Disbursements
and Unpaid Obligations (SODUO-PY)
5. Summary of Report of Disbursements

12

B. The FARs prescribed in the Circular shall replace the following

DBM and COA reports as follows:
1. DBM
Statement of Allotments, Obligations and Balances (SAOB)
BAR No. 4
Financial Report of Operations (BAR No. 2)
Monthly Report of Disbursements Bar No. 3

2. COA

SAOB
Detailed Breakdown of Obligations
Detailed Breakdown of Disbursements
Regional Breakdown of Expenses
Statement of Cumulative Allotments, Obligations Incurred
and Unobligated Balances
Detailed Statement of Cumulative Expenditures/Obligations
Incurred, Obligations Liquidated/Disbursements and Unliquidated
Obligations
13

Responsibilities
1. The FARs shall be prepared and certified correct by the
following officials:
Budget Officer/Head of Budget Unit for the portion of the
report pertaining to appropriations, allotments, obligations,
unobligated allotments and unreleased appropriations
Chief Accountant/Head of Accounting Unit for the portion
of the report pertaining to appropriations, allotments,
obligations, unobligated allotments and unreleased
appropriationsChief Accountant/Head of Accounting Unit
for the portion of the report pertaining t disbursement and
unpaid obligations
The FARs shall be signed by the Agency Head as the
approving official. He/she shall ensure the timely submission
of the accurate and reliable FARs.

14

Due Dates of Submission to COA and DBM

All Departments/Agencies not later than the 30th
day after the end of each quarter
The Lower Operating Units within (5) days after
the end of each quarter for consolidation
The Agency Regional Offices to submit the
consolidated report to COA (GAS) and DBM CO
within (10) days after the end of each quarter

15

Penalty Clause
COA and DBM shall regularly monitor agency/OU
compliance with the reporting requirements prescribed
in the Circular.
For failure to submit the FARs, the no report, no
release policy of the DBM shall be enforced.
Administrative sanctions on the automatic suspension
of the payment of salaries of the officials concerned.
Violation for three (3) times without justifiable cause
during the year, shall constitute a ground for the filing
of an administrative/disciplinary action against the
officials for inefficiency and incompetence.

16

COA REVISED
CHART OF ACCOUNTS

17

Legal Basis
COA Circular No. 2013-002 dated
January 30, 2013
Effective Date: January 01, 2014

18

Objectives
To provide new accounts for the adoption of

the Philippine Public Sector Accounting

Standards (harmonized with IPSAS)
To provide uniform accounts for national

government accounting and budget systems

to facilitate the preparation of harmonized
financial and budgetary accountability reports
19

Objectives
To expand the account code from three (3)

digits in the NGAS Chart of Accounts to eight

(8) digits, to allow expansion or creation of
new accounts as may be necessary to
implement new standards or policies and
provide up to four levels of consolidation
depending on the users information needs.
20

Major Changes
a. Coverage is limited only to all
national government agencies and
GOCCs receiving funds constituted as
SAGF from the National Government
b. Expanded account code structure from
three (3) digits to eight (8) digits
21

Account Code Structure

22

Account Groups
Codes are assigned to account groups to
facilitate location of accounts in the general
and subsidiary ledgers, to provide systematic
arrangement and classification of accounts
and facilitate preparation of the consolidated
financial reports as follows:
Code

1
2
3

Account Groups

Assets
Liabilities
Equity

23

Asset without Contra Account

Ex. Cash, Collecting Officer

24

Asset with Contra Account

Ex. Accounts Receivable
Asset with contra account

1 03 01 01 0

03

1 01 1

Asset
Asset
Receivables
Receivables

Loans
and
Receivable
Loans and
Receivable
Accounts
Accounts
Accounts Receivable
Accounts
Receivable
Allowance for Impairment General
Ledger Receivable
Accounts
Contra-Account

25

Asset with Contra Account

Ex. Allowance for Impairment
Accounts Receivable
Asset with contra account
1

03

1 01 1

1 03 01 01 1

Asset
Receivables
Loans and Receivable
Accounts
Accounts Receivable
Allowance for Impairment Accounts Receivable

26

Major Changes
c. New accounts were provided for the
implementation of the Philippine
Public Sector Accounting Standards
(PPSAS)

27

New Accounts
Example:
1 02 01 010
1 02 02 011

Financial Assets Held for Trading

Allowance for Impairment Investments in Treasury Bills Local

in compliance with IPSAS 28-30

in compliance with IPSAS 29 (Financial Instruments Recognition and Measurement)

1 03 02 020
1 03 02 021

Finance Lease Receivable

Allowance for Impairment Finance Lease Receivables
Investment Property, Buildings
Accumulated Depreciation Investment Property, Buildings
Accumulated Impairment Losses Investment Property, Buildings

in compliance with IPSAS 13 (Leases)

in compliance with IPSAS 13 (Leases)

1 05 01 020
1 05 01 021
1 05 01 022

in compliance with IPSAS 16 (Investment Property)

in compliance with IPSAS 16 (Investment Property)
in compliance with IPSAS 26 (Impairment of Cash
Generating Assets)
28

New Accounts
1 01 04 010
1 01 04 020
1 01 04 030

Cash-Treasury/Agency
Deposit, Regular
Cash - Treasury/Agency
Deposit, Special Account
Cash - Treasury/Agency
Deposit, Trust
29

Major Changes
d. Some accounts were deleted since
these accounts are for use by local
government units or governmentowned and/or controlled
corporations, while other accounts
are no longer applicable to
national government agencies.
30

Deleted Accounts
Example:

31

Major Changes
e. Some accounts were either
expanded or compressed. For instance,
expense accounts for repairs and
maintenance and depreciation of
property, plant and equipment which
were previously presented per asset
account were compressed based on the
major account classification
32

Compressed Accounts
Example:
811 Repairs and Maintenance 5 02 13 040 Repairs and
Office Buildings
Maintenance812 Repairs and Maintenance Buildings and Other
School Buildings
Structures
813 Repairs and Maintenance Hospitals and Health
Centers
814 Repairs and Maintenance Market and Slaughterhouses
815 Repairs and Maintenance Other Structures
33

Compressed Accounts
Example:
811 Depreciation-Office
Buildings
812 Depreciation-School
Buildings
813 Depreciation-Hospitals
and Health Centers
814 Depreciation-Market
and Slaughterhouses
815 Depreciation-Other
Structures

5 05 01 040 Depreciation Buildings and

Other Structures

34

Repairs and Maintenance

Buildings and Other Structures

Subsidiary Ledgers:
01 - Buildings
02 - School Buildings
03 - Hospitals and Health Centers
04 - Markets
05 - Slaughterhouses
06 - Hostels and Dormitories
99 - Other Structures

35

Depreciation - Buildings and Other

Structures

Subsidiary Ledgers:
01 - Buildings
02 - School Buildings
03 - Hospitals and Health Centers
04 - Markets
05 - Slaughterhouses
06 - Hostels and Dormitories
99 - Other Structures

36

Expanded Account
Example:
716 Subsistence, Laundry 5 01 02 050 Subsistence
and Quarters
Allowance
Allowance
5 01 02 060 Laundry
Allowance
5 01 02 070 Quarters
Allowance
37

Expanded Account
Example:
Cash - National
Treasury,
Modified
Disbursement
System (MDS)

1 01 04 040 Cash-Modified Disbursement

System (MDS), Regular
1 01 04 050 Cash-Modified Disbursement
System (MDS), Special
Account
1 01 04 060 Cash-Modified Disbursement
System (MDS), Trust

38

The Revised Chart of Accounts

As Object Code in the
Unified Account Code Structure

39

Purposes of Object Classification

and Coding
To capture all financial transactions such as
goods or services acquired, payments made,
revenue sources and the causes of increases or
decreases in assets and liabilities.
To enable the classification and coding of
transactions for reporting of impact of government
revenues and expenditures on the economy as well
as internal departmental analysis and decisionmaking by oversight agencies.

40

The object coding in the information system

provides a repository of government-wide
information which can be used by oversight
agencies without requiring departments and
agencies to respond to individual requests.

Provides a basis for coding the object

classification which uses accrual accounting
requiring transactions to be recorded in the period
when they occur and not only when cash or
equivalents are received or paid.
41

The Unified Account

Code Structure
FUNDING SOURCE
6Digits

ORGANIZATION
12 digits

LOCATION
9 digits

MFO/PROGRA
M, ACTIVITY
and PROJECT
9 digits

Financin
g Source
1 digit

Department Agency Operating

2 digits
3 digits Unit
7 digits

Region Province City,

Barangay
2 digits 2 digits Municipa 3 digits
lity
2 digits

MFO/PAP Code COACo Sub9 digits

A*Obje Object
ct8
2 digits
digits

Required

Required Optional

Unique for each

Department/Agenc
y

Required

Authorization Fund Category

2 digits
3 digits

Required Required

Optional

OBJECT CODE
10 digits

Uniform across
Government

42

The Unified Account Code

Structure (UACS)
Jointly developed by DBM, DOF and COA
It is a government-wide coding framework to
provide a harmonized budgetary and accounting
code classification that will facilitate reporting
of actual revenues and collections and
expenditures compared with programmed
revenues and expenditures, starting fiscal year
2014
43

 The UACS is to be adopted in identifying,

aggregating, budgeting, accounting, auditing
and reporting the financial transactions of
the government.

Enhance the quality and timeliness of

financial data for the generation of the
required reports and analysis of the same.

Strengthen financial controls and

accountability.
44

Key Elements of the UACS

Funding Source Codes: Six (6) digit code
to reflect the Financing Source,
Authorization and Funding Category

Organization Codes: Twelve (12) digit code

to reflect the Department, Agency and SubAgency or Operating Unit/Revenue
Collecting Unit
45

 Location Codes: Nine (9) digit code to reflect the

Region/Province/Municipality/Barangay following
the Philippine Standard Geographic Code
prescribed by the National Statistical Coordination
Board

Major Final Output (MFO)/Program, Activity and

Project (PAP) codes: Nine (9) digit code to reflect
the MFO/PAP codes

Object codes: Assets, Liabilities, Equity, Revenues,

and Expenses following the COA Chart of
Accounts by object and sub-objects provided by
BTr, BIR, DOF, BOC and DBM

46

Object Code Structure in UACS

OBJECT CODE
10 digits
COA
Revised Chart of Accounts
8 digits

DBM
Sub-Object Code
2 digits

47

Account Code Structure in UACS

Generally, the account code structure below

shall be followed.
Account Code Structure
8 digits
FS Element
1 digit

Major

Summary

Account

Account

2 digits

2 digits

GL Account
3 digits

FS Elements:
1

Assets

Liabilities

Equity

Income

Expenses

48

Sub-Object Code

If disaggregation is necessary, sub object codes of two digits

shall be used to show the breakdown of selected assets, income
and expenses, otherwise, two zeros will be used. The
responsibility for disaggregation and sub-coding of the
following accounts are as shown below.
Accounts
Cash in Bank
Taxes
Import Duties
Non-Tax Revenues
Personnel Services
MOOE
Capital Outlays

Agency Responsible for

Disaggregation
BTr
BIR
BOC
DOF/BTr
DBM
DBM
DBM

49

COA Resolution No. 2013-007

dated January 29, 2013

Adoption of the Philippine

Public Sector Standards for
Auditing
50

Twenty-four (24) PPSSAs already

adopted

Eleven (11) PPSSAs are being finalized

for submission to the Commission
Proper for approval

Eighteen (18) ISAs / ISSAs are ongoing

evaluation for adoption as PPSSAs
51

PPSSA Book 1
PPSSA 20 - Principles of Transparency and
Accountability
PPSSA 30 - Code of Ethics
PPSSA 40 - Quality Control for the Commission on
Audit
PPSSA Book II Volume 1
PPSSA 100 - Basic Principles in Government Auditing
PPSSA 200 - General Standards in Government Auditing
and Standards with Ethical Significance
PPSA 300 - Field Standards in Government Auditing
PPSSA 400 - Reporting Standards in Government
52
Auditing

PPSSA Book II Volume 3A Part 1

PPSSA 1200 - Overall Objectives of the Independent

Auditor and the Conduct of an Audit in
Accordance with International
Standards on Auditing
PPSSA 1210 - Agreeing the Terms of Audit
Engagements
PPSSA 1220 - Quality Control for an Audit of
Financial Statements
PPSSA 1230 - Audit Documentation
53

PPSSA Book II Volume 3A Part 2

PPSSA 1240 - The Auditors Responsibilities
Relating to Fraud in an Audit of
Financial Statements
PPSSA 1250 - Consideration of Laws and
Regulations in an Audit of Financial
Statements
PPSSA 1260 - Communication with Those Charged
with Governance
PPSSA 1265 - Communicating Deficiencies in
Internal Control to Those Charged
with Governance and Management
54

 PPSSA Book

II Volume 3B Part 1

PPSSA 1300 - Planning an Audit of Financial Statements

PPSSA 1315 - Identifying and Assessing the Risks of
Material Misstatement Through
Understanding the Entity and Its
Environment
PPSSA 1320 - Materiality in Planning and Performing an
Audit
PPSSA 1330 - The Auditors Responses to Assessed Risks
PPSSA 1402 - Audit Considerations Relating to an Entity
Using a Service Organization
PPSSA 1450 - Evaluation of Misstatements Identified
During the Audit
55

 PPSSA Book

II Volume 3D

PPSSA 1700 - Forming an Opinion and Reporting

on Financial Statements
PPSSA 1705 - Modifications to the Opinion in the
Independent Auditors Report
PPSSA 1706 - Emphasis on Matter Paragraphs and
Other Matter Paragraphs in the
Independent Auditors Report

56

Updates on Accounting Reforms

Twenty-Three (23) PPSAS are prepared and are ready for

focus group discussions prior to adoption

Six (6) PPSAs remaining are 45% completed

Revision of NGAS Manual is 83% completed
Prescribed the necessary accounting guidelines and
procedures on the reversion of dormant accounts and
unnecessary Special and Trust Funds to the General
Fund pursuant to the Permanent Committee Joint
Circular No. 4-0012 dated September 11, 2012
implementing Executive Order No. 431 dated May 30,
2005

57

COA Circular No. 2012-004 dated

November 28, 2012

Demand for the Immediate

Liquidation and Settlement of All
Cash Advances Outstanding as of
December 31, 2011
58

Rationale
As a general rule, cash advances must be liquidated
within the prescribed periods depending on the nature
and purpose of the cash advance:

Salaries and wages

Petty and field operating expenses
Local travel and foreign travel
Honoraria and similar payments to officials and employees
Expenses for special projects/activities such as anniversary
celebration
Cultural and athletic activities

The above cash advances must be liquidated within

twenty (20) days from the accomplishment of the
purpose.

59

Settlement and Liquidation

of Cash Advance
A cash advance is settled and liquidated either by:
1. Returning the money advanced if unspent,

2. Or by the presentation of regularly accomplished

vouchers, giving satisfactorily detail of the items
thereon paid which must be in accordance with
the purpose for which the cash advance was
granted, and further supported by proper receipts
and other evidence of payment, subject to the
result of the post-audit thereof by the auditor
concerned.

60

Primary responsibility of Heads

of Agencies
Section 2 of Presidential Decree (P.D.) No.
1445, the Government Accounting Code of
the Philippines, places the responsibility to
faithfully take care that government funds
and property be safeguarded from wastage
directly with and primarily on the chief or
head of the government agency concerned
61

Legal presumption against

non-liquidation of cash advance
Article 217 of the Revised Penal Code
states in unequivocal terms that:
The failure of a public officer to have duly
forthcoming any public funds or property
with which he is chargeable, upon demand
by any duly authorized officer, shall be prima
facie evidence that he has put such missing
funds or property to personal use.
62

Final demand to settle

unliquidated cash advance
Final notice and demand is hereby made to all
concerned to settle and liquidate all outstanding
cash advances as of December 31, 2011, on or
before January 31, 2013. Provided, however, that
those who have been issued by the Commission on
Audit notice and demand, prior to the issuance of
this Circular, to settle and liquidate their cash
advances within a specified period, shall do so
within the period specified in the said notice.
63

This Circular shall serve as the

demand required under appropriate
law, rules and regulations to settle the
accountable officers unliquidated
cash advance as well as all those who
are already separated from the service
or have transferred to other agency.
64

Duties of Agency officials:

a. On or before December 15, 2012, all heads of
government agencies shall disseminate in writing this
Circular to all Accountable officials and employees
within their respective agencies and serve a written
notice to and demand settlement of the outstanding
cash advances as of December 31, 2011.
b. The Chief Accountant shall, within the same period,
furnish the head of agency and the head of the
auditing unit thereat a list of accountable officers
with unliquidated and outstanding cash advances.
65

Duties of the Commission on Audit:

Ensure that the outstanding cash advances are
liquidated within the specified periods

Shall Evaluate the cash advances of Accountable

Officers to determine compliance with pertinent COA
Rules and Regulations and to report violations thereof

Shall report on or before February 28, 2013 to the

agency head and to the Director, FAIO, compliance
with this Circular including the ageing of the cash
advances showing the purpose and other information

Submit to the respective COA Directors the vouchers

and all supporting documents relative to the grant of the
cash advance, copy furnished the COA Chairperson
66

COA Circular No. 2012-005

dated December 7, 2013
Revocation of COA Circular 2009-008
dated Nov. 9, 2009 and Prescribing the
Use of Punong Barangays Certification
(PBC) and COA Auditors Advice
(CAA)
67

Salient Features

The responsibility to initiate, process, approve

financial transactions and issue Punong
Barangays Certification (PBC) under oath rests
with the Barangay officials.
The PBC to be issued only under oath after the
PB has duly examined and been satisfied that the:

The DVs are duly certified and approved,

The supporting documents are complete.
The expenditure or disbursement is
proper and valid, and
68

Salient Features

The PB shall be primarily accountable for all

losses arising from issuance of the PBC.

The Authorized Government Depository Bank

(AGDB) shall encash the checks issued if the
corresponding PBC is issued.

Checks encashed without the corresponding PBC

or with falsified PBC shall be the responsibility
of the AGDB.

The PBC shall be numbered sequentially by year

and by barangay and in (4) copies.
69

Salient Features

The PBC (4th) copy shall be submitted to the

accountant for recording within (10) days after
end of month and subsequently submitted to
the COA auditor for audit.

Non-submission of PBCs within (15) days after

demand by the Auditor shall be a ground for
preparation of the COA Auditors Advice
(CAA) to the AGDB to hold further payments
of checks issued by the said barangay.
70

COA Circular No. 2012-003

dated October 29, 2012
Updated Guidelines for the
Prevention of Disallowance of
Irregular, Unnecessary, Excessive
and Unconscionable Expenses as
enumerated under COA Circular No.
85-55A dated Sept. 8, 1985
71

Legal Basis

Section 2(2), Article IX-D of the

1987 Constitution

Section 33 of P.D. 1445

72

Definitions
1. Irregular Expenditures
Expenditure incurred without adhering to
established rules, regulations, procedural
guidelines, policies, principles or practices
that have gained recognition in laws

Transactions conducted in a manner that

deviates or departs from, or which does
not comply with standards set
73

2. Unnecessary Expenditures
Expenditures which could not pass the test of
prudence or the diligence of a good father of a family,
thereby denoting non-responsiveness to the exigencies
of the service
Not supportive of the implementation of the
objectives and mission of the agency relative to the
nature of its operation
Not dictated by the demands of good government, and
those, the utility of which cannot be ascertained at a
specific time
Not essential or that which can be dispensed with
without loss or damage to property

74

3. Excessive Expenditures
Signifies unreasonable expense or expense
incurred at an immoderate quantity and
exorbitant price

Includes expenses which exceed what is

usual or proper, as well as expenses which
are unreasonably high and beyond just
measure or amount

75

4. Extravagant Expenditures
Signifies those incurred without restraint,
judiciousness and economy
Exceeds the bounds of propriety
Immoderate, prodigal, lavish, luxurious,
grossly excessive, and injudicious

76

5. Unconscionable Expenditures
Pertains to expenditures which are
unreasonable and immoderate, and
which no man in his right sense would
make, nor a fair and honest man would
accept as reasonable, and those incurred
in violation of ethical and moral
standards

77

Outline
Fundamental Principles PD 1445
General Requirements for all Types of
Disbursements
Specific Requirements for Each Type of
Disbursement
Cash Advances
Fund Transfers to NGOs/Pos
Fund Transfers to Implementing
Agencies/From Trust Fund to Gen Fund
for Unspent Balance
Salary

78

 Allowances, Honoraria and Other Forms of

Compensations
Other Expenditures
Extraordinary and Miscellaneous Expenses
Prisoners Subsistence Allowance
Procurement
Cultural and Athletic Activities
Human Resource Development and Training
Program
Financial Expenses
Road Right-of-Way (ROW)/Real Property
79

Fundamental Principles,
Sec. 4, P.D. 1445

No money shall be paid except in pursuance of an

appropriation law or other specific statutory authority

Use solely for public purpose
Trust funds only for the specific intended purpose
Fiscal responsibility shared by all those exercising
authority over finance, transactions and operations
Disbursements or dispositions should bear approval of
proper officials
Claims should be supported with complete
documentation
Faithful adherence to all pertinent laws and regulations
Observance of GAAP and practices as well as sound
management and fiscal administration, provided they do
not contravene with existing laws and regulations

80

General Requirements for All Types

of Disbursements
Certification of Availability of Fund by Chief
Accountant
Lawful and sufficient allotment duly obligated as
certified, except for GOCCs and GFIs
Legality of transaction and conformity with laws,
rules and regulations
Approval of expenditure by Head of Office or
authorized representative
Sufficient and relevant documents to establish
validity of claim
81

1.0 Cash Advances

General Guidelines COA Circulars 97-002, 2009-002,
Sec. 89 of PD 1445, pertinent GAA provisions
Specific Guidelines and Documents Required
Types of Cash Advances (Payroll Fund, PCF,
Field/Activity COE, TA (local and foreign)
Granting of Cash Advance
General Guidelines
Documents Required Common to All CAs except
for travel
Additional Documents per type of Cash Advance
Liquidation of Cash Advances
82

2.0 Fund Transfers to NGOs/POs

General Guidelines pertinent provision of
the GAA for the year, Sec. 4.5.6 COA
Circular 2007-001 and GPPB Res. 12-2007
Specific Guidelines and Documentary
Requirements
Release of Funds
Implementation and Liquidation of
Funds Released
Staggered Release of Funds to NGO/PO
83

3.0 Fund Transfers

General Guidelines COA Cirular 94-013,
COA Memo 2010-014

Specific Guidelines and Documents Required

Transfer to Implementing Agencies

Transfer
Implementation and Liquidation by

Implementing Agency
Liquidation by Source Agency
From Trust Fund to General Fund for
Unspent/Excess Amount
84

85