193963008 Government Accounting







Government accounting has been defined as follows:
“Government accounting encompasses all part of the
process of recording, collecting and disbursing of
government resources, and the making of reports
concerning any or all of those operations or about their
result.”
“Government accounting encompasses the processes of
analyzing, recording, classifying, summarizing and
communicating all transactions involving the receipt and
distribution of government funds, and property and
interpreting the results thereof.”

Presidential Decree (PD) No. 1445 which ordains and institutes a
government accounting code of the Philippines, enumerates the
fourfold objectives of government accounting as follows:
 To produce information concerning past operations and present
condition.
 To provide a basis for guidance for future operations.
 To provide for control of the account of public entities and
officers in the receipt, disposition and utilization of funds and
property.
 To report on the financial position and the results of operations
of the government agencies for the information of all persons
concerned.





Section 2(1) The Commission on Audit (COA) shall have the
power, authority and duty to examine, audit, and settle all
accounts, pertaining to the revenue and receipts of, and
expenditures or uses of funds and property, owned or held in
trust by, or pertaining to, the Government, or any of its
subdivisions, agencies or instrumentalities, including
government-owned or controlled corporations with original
charters, and on a post-audit basis: (a) constitutional bodies,
commission and offices that have been granted fiscal
autonomy under this Constitutions; (b) autonomous state
colleges and universities; (c) other government-owned or
controlled corporations and their subsidiaries; and (d) such
non-governmental entities receiving subsidy or equity, directly

...or indirectly, from or through the Government, which are
required by law or the granting institution to submit to such
audit as a condition of subsidy or equity. However, where the
internal control system of the audited agencies is inadequate,
the Commission may adopt such measures, including
temporary or special pre-audit, as are necessary and
appropriate to correct the deficiencies. It shall keep the
general accounts of the Government and, for such period as
may be provided by law, preserve the vouchers and other
supporting papers pertaining thereto.

(2) The Commission shall have exclusive authority, subject to
limitations in this Article, to define scope of its audit and
examination, establish the techniques and methods required
therefor, and promulgate accounting and auditing rules and
regulations, including those for the prevention and
disallowance of irregular, unnecessary, excessive,
extravagant, or unconscionable expenditure, or uses of
government funds and properties.

Section 3. No law shall be passed exempting any entity of the
Government or its subsidiary in any guise whatever, or any
investment of public funds, from the jurisdiction of the
Commission on Audit.

Section 4. The Commission on Audit shall submit to the
President and Congress, within the time fixed by law, an
annual report covering the financial condition and operation
of the Government, its subdivisions, agencies, and
instrumentalities, including government-owned or controlled
corporations, and non-governmental entities subject to its
audit, and recommend measurers necessary to improve their
effectiveness and efficiency. It shall submit such other reports
as may be required by law.







The offices responsible for government accounting are the
Commission on Audit (COA), the Department of Budget and
Management (DBM). The DBM is charged with the design
preparation and approval of accounting systems of
government agencies per PD 1379 of 1976.
Bureau of Treasury. This is an operating bureau of the
Department of Finance which is charged with receiving and
keeping national funds, managing and controlling
disbursements thereof and maintaining of financial
transactions of all national government offices, agencies
and instrumentalities.
Government Agencies. Each government agencies records
its transactions subject to technical supervision of COA.

DEPARTMENT OF BUDGET AND MANAGEMENT
REGISTRY OF APPROPRIATIONS AND ALLOTMENTS
Sheet No._________
P.P.A.___________

Agency :
Personal Services
Date

Ref. Appropriations Allotments

M OOE

Appropriations
Balance

Appropriations Allotments

Financial Expenses

Appropriations
Balance

Appropriations Allotments

Appropriations
Balance

Capital Outlay
Appropriations

Allotments

Appropriations
Balance

REGISTRY OF APPROPRIATIONS AND ALLOTMENTS
(RAPAL)
INSTRUCTIONS
1. This form shall be accomplished as follows:

a.
b.
c.
d.
e.
f.
g.
h.

Agency - name of the agency
Sheet No. – sheet number which shall be one series per year
Program/Project/Activity (P.P.A.) - code for program/project/
activity of the agency per General Appropriations Act/Budget
documents
Date – date of recording
Reference – numbers of the General Appropriations Act,
Agency Budget Matrix (ABM) and Special Allotment Release
Order (SARO)
Appropriations – amount of appropriations approved for PS,
MOOE, FE and CO
Allotments - amount of allotments releases per ABM/SARO
Appropriations Balance – running balance of appropriations

2. This Registry shall be maintained by the Department of Budget
and Management for each Department/Agency of the National
Government by Program, Project and Activity to ensure that
allotment releases are within the authorized appropriation.

DEPARTMENT OF BUDGET AND MANAGEMENT
REGISTRY OF ALLOTMENTS AND NOTICE OF CASH ALLOCATION (NCA) ISSUED
Department /Agency :
Date

Reference

Sheet No.:
Allotments
Issued

NCA
Issued

Balance
Unfunded Allotment

REGISTRY OF ALLOTMENTS and NCA ISSUED
(RANCAI)
INSTRUCTIONS
1.

This form shall be accomplished as follows:

a.
b.
c.
d.
e.
f.
g.

Department/Agency – name of the Department/Agency
Sheet No. – sheet number which shall be one series per year
Date – date of the reference document
Reference – reference document such as JEV No., SARO
No., etc.
Allotments Issued – amount of allotments issued per
approved ABM/SARO
NCA Issued – amount of Notice of Cash Allocation issued
to the agency
Balance – running balance of unfunded allotment

2.

At the end of the year, it shall be totaled and ruled.

3.

This form shall be used by the Department of Budget and
Management for each Department/Agency of the National
Government to ensure that NCAs issued are covered by
allotments released to agencies.

Bureau of the T reasury
REGISTRY OF NOTICE OF CASH ALLOCATION AND
REPLENISHMENTS
Sheet No.: ______
Notice of

Replenishments

Cash Allocation
Date

No.

Amount

Notice of Cash

Journal Entry Voucher (JEV)
Ref.

Date

No.

Amount

Allocation
Balance

REGISTRY OF NOTICE OF CASH ALLOCATION (NCA)
AND REPLENISHMENTS (RENREP)
INSTRUCTIONS
1. The Registry shall be filled up with the following information:

a. Sheet No. – sheet number which shall be one series per year
b. Notice of Cash Allocation (NCA)
 Date – date of the NCA issued by the DBM
 No.- number of the NCA
 Amount – amount of the NCA
c. Replenishments
 Ref – report received from the bank evidencing the payment of
checks negotiated
 Journal Entry Voucher (JEV)
1. Date – date of the JEV
2. No. - number of the JEV
3. Amount – amount of replenishment made
d. Notice of Cash Allocation Balance – balance of the NCA after
deducting replenishment made.
2.

The RENREP shall be maintained by the Bureau of the Treasury
for the year.



All government expenditures must be based on a budget.
Section 22, Article VII of the Constitution states:
“The President shall submit to Congress within thirty days
from the opening of every regular session, as the basis of
the general appropriation bill, a budget of expenditures
and sources of financing, including receipts from existing
and proposed revenue measures.”



The national budget may therefore be defined as a
statement of the estimated receipts based on existing and
proposed revenue measures and of expenditures which
serves as the basis of the general appropriation bill. The
budget process consist of the following phases:
1. Preparation
2. Authorization
3. Execution
4. Accountability



Budgetary priorities and activities are determined and
translated into budgetary estimates. The various
government agencies prepares their budget which in turn
are reviewed and collated at different department level and
finalized by the President. The national budget is
subsequently submitted to the legislature and serve as
basis in the preparation of the annual appropriation law.



This phase involves the review of the budget by the
legislature and the formulation of an appropriation act in
accordance with the process specified in the constitution.





This phase involves the conversion of the plan into reality.
The different department are informed of their allotment
and cash allocations based on the agency budget.
The different deparments and their sub-units see to it that
the expenditures are made based on plans and the revenue
producing agencies see to it that the budgeted figure is
reached.



This phase involves the comparison of performance with
the predetermined plans. Expenditures and performance
are evaluated. Obligations incurred, personnel utilized and
work accomplishments are compared with the plans and
goals previously submitted by the agencies before the
finalization of the national budget. The DBM and the budget
units of the agencies decide on the budget information they
need such as work performance and staffing pattern.



The COA performs its share in the control of government
operations as provided in PD 898 and the Constitution.
Accounting rules and regulations are issued and technical
supervision is exercised over agency accounting units so
that budget information needed can be immediately
secured.

The different types of budgets that have been introduced in
government accounting are enumerated below:
 Line Item Budget. This is the simplest type of budget for its refers
merely to a listing of the expenditures. The objectives of
expenditures are divided into 23 classes ranging from personal
services to loans.
 Performance Budgeting. This method emphasizes on functions,
activities and expected results. The objects of expenditures are
classified into (a) personal services, (b) maintenances and
operating expenses, (c) financial expenses and (d) capital
outlays. This is due to (a) the constraints such as the difficulty in
work measurement because many of the agency activities could
not be quantitatively measured in a meaningful manner (b) the
additional requirement for the manager to be skillful in
management and cost accounting.





Planning, Programming Budgeting System (PPBS). This was
introduced in 1976 with the organization of NEDA, a
superbody on development which gave emphasis on
planning. Long-term budgeting, the use of economic tools of
analysis such as cost-benefit analysis, cost/utility analysis
and ranking of priorities were introduced.
Zero Base Budgeting (ZBB). This technique involves the
planning for the current budget period with a zero starting
point, that is, unused appropriation in the past are not
brought forward to the current budget period. Its emphasis
is on objectives, the results that these objectives seek to
achieve and the estimated cost involved in their
accomplishment.

a. Modified Accrual Basis of Accounting. Expenses shall be
recognized when incurred and reported in the financial
statements in the period to which they relate. Income shall
be on accrual basis except for transactions where accrual
basis is impractical or when other methods are required by
law.

b. One Fund Concept. This system adopt the one fund
concept. Separate fund accounting shall be done only when
specifically required by law or by a donor agency or when
otherwise necessitated by circumstances subject to prior
approval of the COA.

c. Charts of Accounts and Account Code. A new chart of
accounts and coding structure with a three-digit account
numbering system shall be adopted.

d. Books of Accounts. All national agencies shall maintain two
sets of books, namely, the regular agency (RA) books and
the national government (NG) books. The different books of
accounts being used under the manual method are given
below. When agency accounting is already computerized,
only the general journal and the ledgers will remain in use.

Regular Agency (RA) Books. There are for the recording of the
receipt and utilization of Notice of Cash Allocation (NCA)
and other income/receipts which the agencies are
authorized to use and to deposit with Authorized
Government Depository Bank (AGDB) and the National
Treasury.
Journals
• Cash Receipts Journal (CRJ)
• Cash Disbursement Journal (CDJ)
• Check Disbursement Journal (CkDJ)
• General Journal (GJ)

Ledgers
• General Ledger (GL)
• Subsidiary Ledger (SL) for:
Cash
Liabilities
Receivables
Income
Inventories
Expenses
Investments
Property, Plant and Equipment
Construction in Progress

GENERAL JOURNAL
___________________________
Agency
Sheet No. :__________

Date

JEV
No.

Particulars

Account
Code

P

Amount
Debit

Credit

GENERAL JOURNAL (GJ)
INSTRUCTIONS
A. This journal shall be accomplished as follows:
1. Agency - name of the agency
2. Month – month covered by the journal
3. Sheet No. – sheet number of the General Journal, which shall
be one series for each year
4. Date – date of the Journal Entry Voucher (JEV)
5. JEV No. – assigned JEV number
6. Particulars – brief description of the transaction
7. Account Code – account code used to record the transaction
8. P (Posting Reference) – put a check "" mark to indicate
completion of posting in the appropriate GL account
9. Amount Debit - amount debited corresponding to the account
10. Amount Credit – amount credited corresponding to the
account
11. Amount Credit – amount credited corresponding to the
account

B.
C.

D.
E.
F.
G.
H.
I.

Only transaction not recorded in the Special Journals shall be
recorded in the General Journal.
Entries to the journal shall be made only on the bases of duly
approved JEVs. Said entries shall be posted individually to the
General Ledger.
A new sheet shall be started at the beginning of each month.
Each sheet shall be footed and the totals carried forward to the next
sheet.
Succeeding sheet shall start with the total brought forward.
At the end of the month, it shall be footed, balanced and ruled.
The totals of the debit and credit columns must be equal.
Every page shall be certified correct by the Chief Accountant/Head
of the Accounting Unit as follows:
“CERTIFIED CORRECT:
______________________________
Signature
______________________________
Designation”

SUBSIDIARY LEDGER
Agency

Account of

Account Code

Office/Address

GL

Contact Person/Number

SL

Date

Particulars

Amount

Ref.
Debit

Credit

Balance

A.

SUBSIDIARY LEDGER (SL)
INSTRUCTIONS
This ledger shall be accomplished as follows:
Agency –
name of the agency
Account of/Office/Address/Contact Person - name of the
individual/company/agency
and
office
address
of
debtor/creditor. In case of an agency/company, include the
contact person and telephone number/e-mail address
3.
GL Account Code - General Ledger Account Code as used in
the journals
4.
SL Account Code - Subsidiary Ledger Account Code as
provided by the agency
5.
Date – date of the source documents (i.e. JEV , OR, etc.)
6.
Particulars - other information or details pertaining to the
transaction
7.
Ref.
reference
document
such
as
the
Statement
of
Account/Journal Entry
Voucher/Official Receipt/Disbursement
Voucher number, etc.
8.
Debit Column – amount being debited to the account
9.
Credit Column – amount being credited to the account.
10. Balance - the difference between the Debit and Credit
columns.
Place parentheses in the amount with a negative
balance.
1.
2.

B.

Subsidiary Ledgers shall be kept for each control account in the
General Ledger.
At the end of each month, the totals of the
subsidiary ledger balances shall be reconciled with the corresponding
controlling account.

C.

Every sheet shall be footed in pencil. The difference of the totals of
Debit and Credit columns should tie-up with the running balance
column.
These totals shall be carried forward to the next sheet.
Succeeding sheets start with the totals brought forward.

National Government (NG) Books. These are for the recording
of income which the agencies are not authorized to use and
are required to be remitted to the National Treasury.
• Cash Journal (CJ)
• General Journal (GJ)
• General Ledger (GL)
• Subsidiary Ledger (SL)

CASH JOURNAL
Agency : __________________________
Month : ___________________________
C O L L EC T I O NS

REM I T T A NC E

Cre dit
Date

RCD No.

JEV No.

Name of Collecting

Debit

Officer

106

Sheet No.: ____

De b i t
SUNDRY

Acct. Code P

SUNDRY
Amount

Acct. Code

P

Credit
Amount

106

CASH JOURNAL (CJ)
INSTRUCTIONS
A. This journal shall be accomplished as follows:
1.
2.
3.
4.
5.
6.
7.
8.
9.

10.
11.

12.
13.
14.
15.

16.
17.

Agency - name of the agency
Month - month covered by the journal
Sheet No. - number of sheet of the journal, which shall be one
series for each year
Date - date of JEV
RCD No. – Report of Collections and Deposits Number
JEV No. - assigned JEV number
Name of Collecting Officer - name of the Collecting Officer
Collections Debit Column - amount collected based on the
Official Receipt issued
Collections Credit Columns – amount of income, receivables and
other recurring accounts collected based on the Official Receipt
issued
Collections Sundry Account Code Column – code of accounts
credited for which no column has been provided
Collections Sundry P (Posting Reference) Column – put a check
"" mark to indicate completion of posting in the appropriate GL
account
Collection Sundry, Amount Column – amount to be credited to
the account
Remittance Debit Columns – amount debited upon remittance of
collections to the Bureau of the Treasury (BTr)
Remittance Sundry Account Code Column– code of accounts
debited for which no column has been provided
Remittance Sundry P (Posting Reference) Column – put a check
"" mark to indicate completion of posting in the appropriate GL
account
Remittance Sundry, Amount Column - amount to be debited to
the account
Remittance Credit Column - amount deposited to the BTr as
deduction to the account of the Collecting Officer

B. This journal shall be used to record cash receipts/collections which
are required to be recorded in NG books.

C. The sundry columns shall be summarized/recapitulated and shall
be shown below the totals using the format below:
Recapitulation:
Amount
Account Code

P

Debit

Credit

D. A new sheet shall be started at the beginning of each month.
Each sheet shall be footed and the totals carried forward to the
next sheet. The succeeding sheet shall start with the totals
brought forward.
E. At the end of the month, it shall be footed, balanced and ruled.
The ruling shall be made on the line immediately after the last
entry.
F. Posting to the General Ledger (GL) shall be made directly from
this journal. A check mark immediately underneath the total of
the special columns shall be made to indicate completion of
posting to the GL.
G. Every sheet shall be certified by the Chief Accountant/Head of
Accounting Unit as follows:
“CERTIFIED CORRECT:
Signature
Designation”

d. Books of Accounts. All national agencies shall maintain two
sets of books, namely, the regular agency (RA) books and
the national government (NG) books. The different books of
accounts being used under the manual method are given
below. When agency accounting is already computerized,
only the general journal and the ledgers will remain in use.

e. Financial Statements. The following statements shall be
prepared:
• Statement of Financial Position
• Statement of Government Equity
• Statement of Income and Expenses
• Statement of Cash Flows
• Notes to Financial Statements

f. Two-Money Column Trial Balance. The two-money column
trial balance showing the account balances shall be used.

g. Allotment and Obligation. Obligation accounting is modified to
simplify procedures in the incurrence and liquidation of
obligations and the recording of the budgetary account
(allotments and obligations incurred and liquidated). Separate
registries shall be maintained to control the allotments and
obligations for each of the four classes of allotments, namely:
• Registry of Allotments and Obligations – Capital Outlay
(RAOCO)
• Registry of Allotments and Obligations – Maintenance and
Other Operating Expenses (RAOMO)
• Registry of Allotments and Obligations – Personal Services
(RAOPS)
• Registry of Allotments and Obligations – Financial Expenses
(RAOFE)

REGIST RY OF ALLOT M ENT S AND OBLIGAT IONS
CAPIT AL OUT LAY (RAOCO)
___________________________
Agency
P.P.A.

: ______________

S heet No.: ______________

Date

Reference

Account
Code

Allotme nt
Re ce ive d

Obliga tion
Incurre d

Balance

REGISTRY OF ALLOTMENTS AND OBLIGATIONS
CAPITAL OUTLAY (RAOCO)
INSTRUCTIONS
A.

This form shall be accomplished as follows:
1.
2.
3.
3.
4.
5.
6.
7.
8.

Agency - name of the agency
P.P.A.
- code for program/project/activity as shown in the
ABM/SARO
Sheet No. – sheet number which shall be one series per year
Date – date of the Allotment and Obligation Slip (ALOBS)
Reference – ALOBS number
Account Code – account code used in accordance with the
prescribed Chart of Accounts
Allotment Received - amount of allotment received based on
the approved ALOBS supported by ABM/SARO.
Obligation Incurred - amount of obligation incurred based on
the approved ALOBS supported by pertinent documents
Balance –balance of available allotment

B.

This Registry shall be maintained by the Budget Unit of agencies.

C.

The RAOs shall be maintained by Program, Project and Activity for
Capital Outlay.

D.

Separate Registry shall be maintained for each of the following:
1.
2.
3.

Allotment chargeable to Current Year’s appropriations
Allotment Chargeable to Prior Years’ Unalloted Continuing
Appropriations
Alloted Continuing Appropriations

REGIST RY OF ALLOT MENT S AND OBLIGAT IONS
MAINT ENANCE AND OT HER OPERAT ING EXPENSES (RAOMO)

____________________________
Agency
P.P.A.

:__________

S heet No. :__________

Date

Reference

Account
Code

Allotme nt
Re ce ive d

Obliga tion
Incurre d

Balance

REGISTRY OF ALLOTMENTS AND OBLIGATIONS
MAINTENANCE AND OTHER OPERATING EXPENSES

(RAOMO)
INSTRUCTIONS
A. This form shall be accomplished as follows:
1.
2.
3.
3.
4.
5.
6.
7.
8.

Agency - name of the agency
Program/Project/Activity (P.P.A.) - code for program/project/
activity as shown in the ABM/SARO.
Sheet No. – sheet number which shall be one series per year
Date – date of the Allotment and Obligation Slip (ALOBS)
Reference – ALOBS number
Account Code – account code used in accordance with the
prescribed Chart of Accounts
Allotment Received - amount of allotment received based on
the approved ALOBS supported by ABM/SARO
Obligation Incurred - amount of obligation incurred based on
the approved ALOBS supported by pertinent documents
Balance – balance of available allotment

C. This Registry shall be maintained by the Budget Unit of agencies.
B. The RAOs shall be maintained by Program, Project and Activity for
Maintenance and Other Operating Expenses.

REGIST RY OF ALLOTMENTS AND OBLIGATIONS
PERSONAL SERVICES (PS)

____________________________
Agency
P.P.A.

:__________

S heet No. :__________

Date

Reference

Account
Code

Allotme nt
Re ce ive d

Obliga tion
Incurre d

Balance

REGISTRY OF ALLOTMENTS AND OBLIGATIONS
PERSONAL SERVICES (PS)

(RAOPS)
INSTRUCTIONS
A.

This form shall be accomplished as follows:
1.
2.
3.
3.
4.
5.
6.
7.
8.

Agency - name of the agency
Program/Project/Activity (P.P.A.) - code for program/project/
activity as shown in the ABM/SARO.
Sheet No. – sheet number which shall be one series per year
Date – date of the Allotment and Obligation Slip (ALOBS)
Reference – ALOBS number
Account Code – account code used in accordance with the
prescribed Chart of Accounts
Allotment Received - amount of allotment received based on
the approved ALOBS supported by ABM/SARO
Obligation Incurred - amount of obligation incurred based on
the approved ALOBS supported by pertinent documents
Balance – balance of available allotment

B.

This Registry shall be maintained by the Budget Unit of agencies.

C.

The RAOs shall be maintained by Program, Project and Activity for
Personal Services.

D.

Separate Registry shall be maintained for Overdraft/Obligations
Incurred in Excess of Allotment.

REGISTRY OF ALLOTMENTS AND OBLIGATIONS
FINANCIAL EXPENSES (RAOFE)
____________________________
Agency
P.P.A.

:__________

S heet No. :__________

Date

Reference

Account
Code

Allotme nt
Re ce ive d

Obliga tion
Incurre d

Balance

REGISTRY OF ALLOTMENTS AND OBLIGATIONS
FINANCIAL EXPENSES

(RAOFE)
INSTRUCTIONS
A.

This form shall be accomplished as follows:
1.
2.
3.
3.
4.
5.
6.
7.
8.

Agency - name of the agency
Program/Project/Activity (P.P.A.) - code for program/project/
activity as shown in the ABM/SARO.
Sheet No. – sheet number which shall be one series per year
Date – date of the Allotment and Obligation Slip (ALOBS)
Reference – ALOBS number
Account Code – account code used in accordance with the
prescribed Chart of Accounts
Allotment Received - amount of allotment received based on
the approved ALOBS supported by ABM/SARO
Obligation Incurred - amount of obligation incurred based on
the approved ALOBS supported by pertinent documents
Balance – balance of available allotment

B.

This Registry shall be maintained by the Budget Unit of agencies.

C.

The RAOs shall be maintained by Program, Project and Activity for
Financial Expenses.

D.

Separate Registry shall be maintained for Overdraft/Obligations
Incurred in Excess of Allotment.

h. Notice of Cash Allocation (NCA). An agency records receipt
of NCA by debiting Cash-National Treasury, Modified
Disbursement System (NT, MDS) and the entry is as follows:
Cash-NT, MDS
xxx
Subsidy Income from
National Government (SING)

xxx

i. Financial Expenses. Financial expenses such bank charges,
interest expenses, commitment charges and other related
expenses are classified separately from Maintenance and
Other Operating Expenses (MOOE).

j. Perpetual Inventory of Supplies and Materials . Supplies and
materials purchased for inventory purpose is recorded using
the perpetual inventory system.

k. Inventory Valuation. The moving average method is used in
determining the cost of ending inventory of supplies and
materials.

l. Ledger Cards for Supplies and for Property, Plant and
Equipment. The Accounting Units of agencies as well as the
Property Offices maintain Supplies Ledger Cards / Stock
Cards (by stock number) and Property, Plant and Equipment
Ledger Cards (by their respective categories).

STOCK CARD
_______________________________________________
Agency
Stock No.:

Description:

Item:

Re-order Point:

Date

Reference

Receipt
Qty.

Qty.

Issuance
Office

Balance
Qty.

No. of Days to
Consume

STOCK CARD (SC)
INSTRUCTIONS
A.

This form shall be accomplished as follows:
1.
2.
3.
4.
5.
6.
7.
8.
9.

10.

Agency – name of the agency
Item/Description – name of the item and its description
Stock No. – stock number assigned by the property personnel for
each kind of supplies
Re–order Point – quantity of stocks which when reached signal
the need to re-order the item
Date – date of the source document
Reference – reference document used as a basis in the recording
of the transactions such as the receipt/issuance of supplies
Receipt-Qty – number of supplies received
Issuance–Qty./Office – number of supplies issued and to what
office/unit issued
Balance-Qty – the difference between the receipt and issuance
which shall be equal to the quantity of supplies on hand by the
Supply Officer
No. of Days to Consume – estimated number of days for which
the stock is to be consumed as determined by the Supply and
Property Unit based on the historical data.

B.

The SC shall be maintained by the Supply and Property Unit for each
item of supplies to record all receipts and issuances.

C.

Transactions shall be posted promptly from source documents.

D.

The physical inventory of supplies shall be reconciled every six
months with the stock cards and any discrepancy/ies shall be
immediately verified and adjusted.

E.

The balance per stock card shall be reconciled regularly with the
stock ledger card maintained by the Accounting Unit.

PROPERTY CARD
_______________________________________________
Agency
Property, Plant and Equipment:

Property Number:

Description:

Date

Reference

Receipt
Qty.

Qty.

Transfers/ Disposal
Office/Officer

Balance
Qty.

A.

PROPERTY CARD (PC)
INSTRUCTIONS
This ledger shall be accomplished as follows:
1.
2.
3.
4.
5.
6.

7.
8.

9.

Agency – name of the agency
Property, Plant and Equipment – type of fixed asset
(i.e. Xerox machine, filing cabinet, etc.)
Description – description of the property, plant and
equipment (i.e. brand, size, color, serial no., etc.)
Property Number – assigned property number by the
Supply and Property Unit
Date – date of acquisition/transfer
Reference – reference document used as a basis in
recording the receipt or issuance of property, plant and
equipment
Receipt-Qty – quantity of property, plant and equipment
received based on source documents
Transfer/Disposal-Qty – quantity of property, plant and
equipment transferred to other NGAs or disposed, issued,
etc.
Balance-Qty – difference between the quantity of the
property, plant and equipment on hand less the transfers,
disposed or issued if any

B.

The PC shall be kept for each class of property, plant and
equipment
to
record
the
description,
acquisition,
transfer/disposal and other information about the asset.

C.

Transactions shall be posted promptly from source documents.
The Supply and Property Unit shall maintain this card.

D.

The physical inventory of the property, plant and equipment
shall be reconciled with the property cards every year and any
discrepancies should be immediately verified and adjusted.

PROPERTY, PLANT AND EQUIPMENT LEDGER CARD
_______________________________________________
Agency
Account Code:

Propery, Plant and Equipment:

Est. Useful Life:
Description:

Rate of Depreciation:

R e c e i p t
Date

Reference

Qty.

Unit Cost

Total Cost

Accumulated

Transfers/

Depreciation

Adjustment

Balance

PROPERTY, PLANT AND EQUIPMENT LEDGER CARD
(PPELC)

A.

B.

INSTRUCTIONS
This ledger shall be accomplished as follows:
1.
2.
3.
4.
5.

6.

7.
8.
9.

10.
11.
12.

Agency – name of the agency
Property, Plant and Equipment – type of property, plant
and equipment (i.e. Xerox machine, filing cabinet, etc.)
Description – description of the assets (i.e. brand, size,
color, etc.)
Account Code – account code as provided in the Chart of
Accounts
Estimated Useful Life – estimated useful life of Property,
Plant and Equipment as determined by the Commission on
Audit
Rate of Depreciation – rate of depreciation per month to be
nd
recorded in the books of accounts starting on the 2
month
following
the
date
of
acquisition/delivery.
It
shall
be
computed using the straight-line method of depreciation
Date – date of the source document.
Reference – reference documents used as the bases in
recording the transactions such as JEV
Receipt-Qty/Unit Cost/Total Cost – the quantity received,
the unit cost and the total cost of the property, plant and
equipment
Accumulated Depreciation – the amount of depreciation
charged to the property, plant and equipment.
Transfer/Adjustment – the cost of the asset transferred to
other NGAs or disposed/adjusted
Balance – the difference between the total cost of the asset
less the accumulated depreciation and transfers, if any

The PPELC shall be kept by the Accounting Unit for each class of
asset to record promptly the acquisition, description, custody,
estimated life, depreciation, disposal and other information about the
asset.
C. The physical inventory of the asset shall be reconciled with the
property, plant and equipment ledger cards and the control accounts
and any discrepancies shall be immediately verified and adjusted.

SUPPLIES LEDGER CARD
_______________________________________________
Agency

Stock No.:

Item:

Re-order Point:

Description:
R e c e i p t
Date

Reference

Qty.

Issuance

Unit

Total

Cost

Cost

Qty.

B a l a n c e
Qty.

Unit

Total

No. of Days

Cost

Cost

to Consume

A.

SUPPLIES LEDGER CARDS (SLC)
INSTRUCTIONS
This ledger shall be accomplished as follows:
Agency – name of the agency
Item/Description – name of the item and its description
Stock No. – stock number assigned by the property personnel
for each kind of supplies
4.
Re–order Point – quantity of stocks which when reached
signal the need of re-order of the item
5.
Date – date of the JEV/RIS
6.
Reference – reference documents used as a basis in the
recording of the transactions (i.e. JEV for receipt and RIS for
issuance, etc.)
7.
Receipt-Qty/Unit Cost/Total Cost – quantity, unit cost and
total cost of the supplies received
8.
Issuance – quantity of supplies issued
9.
Balance-Qty –difference between the receipt and issuance,
which shall be equal to the quantity of supplies on hand at the
Supply and Property Unit
10. Balance-Unit Cost – unit cost of the items based on moving
average method
11. Balance-Total Cost – total cost of items on hand/stock
12. No. of Days to Consume – estimated number of days for
which the stock would be consumed as determ ined by the
Supply and Property Unit based on the previous records
1.
2.
3.

B.

The SLC shall be maintained by the Accounting Unit for each type
of supplies to record all receipts and issuances.

C.

Transactions shall be posted promptly from source documents.

D.

The semestral physical inventory of supplies shall be reconciled with
the supplies ledger cards and controlling accounts and any
discrepancy/ies shall be immediately verified and adjusted.

m. Construction Theory. This is applied on assets under
construction for costing purposes. Bonus paid to
contractors for early completion is added to the project’s
total cost; liquidated damages charged and paid for by the
contractors are deduction. Any related expenses incurred
during the construction of the project, such as taxes,
interest, license fees, permit fees, clearance fees, etc. are
capitalized; those incurred after the construction are
treated as operating costs.

n. Registry of Public Infrastructure / Registry of Reforestation
Projects. The corresponding registry is to be maintained by
agencies that construct public properties / infrastructure,
such as roads, bridges, waterways, railways, plazas,
monuments, etc. and by those that invest in reforestation
projects. (Public properties/infrastructure are fixed assets
for use of the general public).
A Schedule of Public Infrastructure/Reforestation Projects
is prepared at year-end and included in the Notes to
Financial Statements.

REGISTRY OF PUBLIC INFRASTRUCTURES
Agency
Sheet No. :_______

Name of Public Intrastructure

Date

Ref.

Description

Location

Amount

A.

REGISTRY OF PUBLIC INFRASTRUCTURES
(RPI)
INSTRUCTIONS
This form shall be accomplished as follows:
1.
2.

3.
4.
5.
6.
7.
8.

Agency – name of the agency
Name of Public Infrastructures – name of public
infrastructure classified as Highways, Roads, Bridges,
Sea Walls, etc.
Sheet No. – sheet number which shall be one series
per year
Date – date of the Journal Entry Voucher (JEV) or date
of the document used as basis of entry in the Registry
Reference – source documents, such as JEV No.
Description – specifications such as length, type and
other information related to the infrastructures
Location – exact location of the project such as
Barangay, Municipality and Province/City
Amount – cost of the public infrastructures when it was
transferred from Regular Agency books based on the
JEV

B.

This Registry shall be used to record the
infrastructure transferred from the RA books.

C.

In
case
the
public
infrastructures
are
destroyed
due
to
fortuitous events, the said infrastructures shall be dropped
from the Registry through a memorandum entry based on
pertinent documents.

D.

Every end of the quarter, it shall be
amount posted directly to the Summary.

E.

It shall be maintained by the Accounting Unit and kept in a
perpetual manner. No new sheet shall be prepared unless the
preceding one is used up.

footed

cost

and

of

public

the

total

REGISTRY OF REFORESTATION PROJECTS
Agency

Sheet No. :_______

Date

Reference

Description

Location

Amount

A.

REGISTRY OF REFORESTATION PROJECTS (RRP)
INSTRUCTIONS
This form shall be accomplished as follows:
1.
2.
3.
4.
5.

6.
7.

Agency – name of the agency
Sheet No. – sheet/page number
Date – date of the Journal Entry Voucher (JEV) or date
of the document used as basis of entry in the Registry
Reference – source documents, such as JEV No.,
Description – specifications such as no. of hectares
planted, type of seedlings and other information related
to the reforestation projects
Location –exact location of the project such as
Barangay, Municipality and Province/City
Amount – cost of reforestation project when it was
transferred from Regular Agency books based on the
JEV

B.

This Registry shall be used to record the cost of reforestation
projects transferred from the RA books.

C.

In case the reforestation projects are destroyed due to
fortuitous events, the said project shall be dropped from the
Registry through a memorandum entry based on pertinent
documents.

D.

Every end of the quarter, it shall be footed.

E.

It shall be maintained by the Accounting Unit and kept in a
perpetual manner. No new sheet shall be prepared unless the
preceding one is used up.

SCHEDULE OF PUBLIC INFRASTRUCTURES
_______________________
Agency Name
As of ____________________

Public Infrastructures:
Highways
Roads
Bridges
Plaza
Seawalls
Railways
Waterways
Irrigation
Canals
Harbors
Aqueducts
Laterals
Parks
Monuments
Totals

Amount
xx
xx
xx
xx
xx
xx
xx
xx
xx
xx
xx
xx
xx
xx
xxxx

Certified Correct:
____________________
Chief Accountant
___________
Date

o. Depreciation. Cost allocation is observed using the straightline method. The provision for depreciation starts with the
second month after purchase of property, plant and
equipment and a residual value of 10% of purchase cost is
set-up. . A table of the estimated useful lives of the different
depreciable assets is provided by COA. Public Infrastructure
/ Reforestation projects as well as serviceable assets that
are no longer being used are not charged any depreciation.

Annual Depreciation = Asset Cost less Estimated Residual/Salvage Value
Estimated Useful Life
Asset Cost
- Purchase or Acquired Value of the Asset
Estimated Salvage Value - 10% of the asset cost
Estimated Useful Life - Estimated number of years the asset shall be
used as determined by the Commission
on Audit

A sample adjusting journal entry for depreciation expense is
as follows:
Account Title

Depreciation-Office Equipment
Accumulated Depreciation-Office
Equipment

Account
Code

922
322

Debit

Credit

1,000
1,000

p. Reclassification of Asset. Serviceable assets that are no
longer used are reclassified as “Other Assets” and are not
subject to depreciation.

q. Allowance for Doubtful Accounts. This is set up for
estimated uncollectible trade receivables to allow for their
fair valuation.

The determination of bad debts expense shall be derived from
computations based on percentages and aging of accounts receivable as
follows:
Age of Accounts

Percentage

1 - 60 days
61 - 180 days
181- 1 year
More than 1 year

1%
2%
3%
5%

An adjusting journal entry to take up bad debts expense is as follows:
Account Title

Account
Code

Bad Debts
Allowance for Doubtful Accounts

929
301

Debit

Credit

1,000
1,000

r. Elimination of Contingent Accounts. Appropriate accounts
are used in recording all financial transaction. Cash
shortages and disallowed payments, which have become
final and executory are charged to receivable accounts,
“Due from Officers and Employees” or “Receivables –
Disallowances/Charges”, as the case may be.

s. Recognition of Liability. Liability is recognized at the time
goods and services are accepted or rendered and supplier /
creditor bills are received.

t. Interest Accrual. This is to be observed for both interest
income and interest expense whenever practical and
appropriate.

u. Accounting for Borrowing and Loans. All borrowing and
loans are recorded to the appropriate liability accounts.

v. Elimination of Corollary and Negative Journal Entries.
Acquisitions/dispositions of assets are debited/credited to
the appropriate asset accounts. Errors are corrected by
making a correcting entry.
(Under the old system, corollary entries were used as those
made upon contracting for the purchase of assets by
debiting an account such as Land and Land Improvement in
Process subject to transfer to the Land and Land
Improvement account upon consummation of the purchase
contract. Errors were corrected by making negative entries,
that is both debit and credit amount are negative.)

w. Imprest System for Petty Cash Fund. The Petty Cash Fund
shall be equal to the total cash on hand and the
unreplenished expenses. All expenses are charged to the
expense account at all times. The fund is not to be used to
purchase inventory/items for stock.

x. Foreign Currency Adjustment. Cash deposits in foreign
currency and outstanding foreign loans are computed at the
exchange rate prescribed by the Bangko Sentral ng Pilipinas
at balance sheet date. The total cash deposits and foreign
loans payable are adjusted at the end of each month and
any gain or loss on foreign exchange is recognized. The
subsidiary ledger for foreign currency obligations reflects
the appropriate foreign currency in which the loan is
payable. The liability is expressed both in foreign and local
currency.

BALANCE SHEET:
Assets = Liabilities + Government Equity

STATEMENT OF INCOME AND EXPENSES
Total Income – Total Expenses = Excess of Income over
Expenses

STATEMENT OF GOVERNMENT EQUITY:
Government Equity, Beginning
Retained Operating Surplus:
Current Operations
Adjustment of Prior Years
Roads, Highways, Bridges (Public Infra)
Government Equity, End

xx
xx
xx

xx
(xx)
xx

STATEMENT OF CASH FLOWS:
Cash Flow from Operating Activities
Cash Flow from Investing Activities
Cash Flow from Financing Activities
Total Cash Provided by Operation, Investing and
Financing Activities
Add: Cash Balance, January 1, 20__
Cash Balance, December 31, 20__

xx
xx
xx

xx
xx
xx



The chart of accounts is a list of general ledger accounts
that are expected to appear in the financial statements.
Thus, the sequence followed in the listing of the accounts is
based on the sequence in which they are to appear in said
statements. Under the NGAS, code are simplified by using
three-digits codes. The grouping is as follows:

ACCOUNTS
Assets
Asset Contra-Accounts
Liabilities
Equity
Income
Tax Revenue National Taxes
Local Taxes
General Income Permits and Licenses
Service Income
Business Income
Subsidy Income
Other Income
Gain or Loss Accounts
Expenses
Personal Services
MOOE
Financial Expenses

ACCOUNT
CODE
100-299
300-399
400-499
500-549
550-699
550-579
580-599
600-609
610-629
630-649
650-659
660-679
680-699
700-999
700-749
750-969
970-999





Cash – National Treasury, Modified Disbursement System.
This account is used to record in the regular agency books
the receipt of Notice of Cash Allocation (NCA) from the DBM
and the corresponding withdrawals therefrom by national
government agencies (NGAs) by issuance of MDS checks. At
year-end, it is adjusted (or closed) for its unused portion.
Cash in Bank – Local Currency, Current Account. This is
used for deposits/withdrawals of local currency in current
account maintained with accredited government depository
banks (AGDBs).






Due from National Government Agencies (NGAs). This is
used for amounts due from departments, bureaus and
other offices of the national government.
Due to National Treasury. This is used for collections due for
remittance to National Treasury.
Due to NGAs. This is used to record liabilities due to
national government agencies including inter-agency
transfer of funds for the implementation of specific
programs/projects.






Government Equity. It represents the difference between the total
assets and total liabilities of national government agencies.
Retained Operating Surplus. This is the account to which Income
and Expense Summary and Prior Years’ Adjustment are closed. It
is subsequently closed to the Government Equity account.
Subsidy Income from National Government (SING). This is the
revenue account credit for receipt of NCA, Tax Remittance Advice
(TRA), tax exemptions granted by the national government. At
year-end, it is adjusted for its unused portion and the used
portion is closed to Income and Expense Summary. This account
is also used for payment of national government agencies’
liabilities by foreign lending/donor institutions.




National Government (NG) Books
Regular Agency (RA) Books

The national government books maintained by the agency
are used to record the following income/receipts.
1. All collections of income not authorized for agency use
and required to be remitted to the Bureau of Treasury
(BTr). Examples are tax revenue, permits and licenses,
operating and service income, business income, rent
income, fines and penalties.
2. Income from grants and donations.
 All income/receipts are supported by subsidiary ledger
entries with the corresponding codes as contained in the
Chart of Accounts. These are to be relayed to the BTr in the
List of Collections upon remittance.



Illustrative Accounting Entries - Typical Transactions of Agencies with Collections/Income
to be recorded in the National Government (NG) Books
Agency - National Government Books
Transactions
Account Debit
Account Title
Code

Beginning Balances:

Cash - Collecting Officers
Accounts Receivables
Due to National Treasury
Income from Govt. Services

106
121
433

Credit

1,000
5,000
6,000

6,000
6,000 6,000

Agency - National Government Books
Transactions

A. Prior Year's Income
1. Deposit of prior year's collections

2. Collection of prior years' receivables

3. Deposit of collections of prior years'
receivables

Account Debit
Code

Account Title

Due to National Treasury
Income from Govt. Services
Cash Collecting Officers

433

Credit

1,000

1,000
106

1,000

Cash - Collecting Officers
Accounts Receivables

106
121

1,500

Due to National Treasury
Cash Collecting Officers

433
106

1,500

1,500

1,500

Agency - National Government Books
Transactions

Account
Code

Account Title

B. Current Year's Income
4. Billing of operating and service
income

Accounts Receivables
Due to National Treasury
Income from Govt. Services

Debit

121
433

3,000
3,000

3,000

5. Collection of billed operating and
service income

Cash - Collecting Officers
Accounts Receivables

106
121

2,500

6. Collection of taxes

Cash - Collecting Officers
Due to National Treasury
Income Tax -Individuals
Income Tax -Partnerships
Income Taxes -Corporations
Capital Gross Tax
Value Added Tax
Fines and Penalties

106
433

2,200

106
433

300

Source
Income Tax-Individuals
Income Tax -Partnerships
Income Tax -Corporations
Property Transfer Tax
Value Added Tax
Fines and Penalties
Total
7. Collection of rentals

Amount
400
300
1,200
100
150
50
2,200

Cash - Collecting Officers
Due to National Treasury
Rent Income

Credit

2,500

2,200

400
300
1,200
100
150
50

300

Note: Subsidiary Ledger (SL) accounts shall be provided for "Due to National Treasury" account. The
code of the income accounts under the Chart of Accounts shall be used as SL accounts and shall be
indicated in the List of Collections which shall be submitted to the BTr.

300

Agency - National Government Books
Transactions

8. Deposit of income/collections
to BTr thru AGDB
a. Taxes

b. Rent Income

Account Title

Due to National Treasury
Income Tax -Individuals
Income Tax -Partnerships
Income Taxes -Corporations
Capital Gross Tax
Value Added Tax
Fines and Penalties
Cash - Collecting Officers
Due to National Treasury
Rent Income
Cash - Collecting Officers

Account
Code

Debit

433

2,200

Credit

400
300
1,200
100
150
50
106
433

2,200
300

300
106

300

Agency - National Government Books
Transactions

Account Title

Account
Code

Debit

106
433

2,000

433

2,000

Credit

C. Accounting for Collection of
Out-of-Town Checks with Bank
Charges - Income from Government
Services - P2,000
9. Collection upon issuance of OR

10. Remittance/Deposit to BTr
thru AGDB
Note: BTr will record cash (at net amount),
bank charges and income (at gross).

Cash - Collecting Officers
Due to National Treasury
Income from Govt. Services
Due to National Treasury
Income from Govt. Services
Cash - Collecting Officers

2,000

2,000

2,000

2,000
106

Agency - National Government Books
Transactions

Account
Code

Account Title

Debit

Credit

D. Accounting for Foreign Exchange Loss
11. Collection of Income from
Govt. Services - $100 @ P50

12. Remittance/Deposit to BTr
thru AGDB

Cash - Collecting Officers
Due to National Treasury
Income from Govt. Services
Due to National Treasury
Income from Govt. Services
Cash - Collecting Officers

106
433

500

433

500

500

500

500

500
106

Note:There will be no bank charges and and foreign
exchange loss to be ecorded in the agency's
NG books.

Note: Subsidiary Ledger (SL) accounts shall be provided for "Due to National Treasury" account. The
code of the income accounts under the Chart of Accounts shall be used as SL accounts and shall be
indicated in the List of Collections which shall be submitted to the BTr.

The regular agency books are used in recording transactions other
than those that have to be recorded in the agency-NG books. Thus,
collections and income to be recorded in the agency books are the
following:
1. Receipts of Notice of Cash Allocation (NCA)
2. Income authorized for agency use and to be deposited with
AGDB. Examples are tuition fees and income from sale of
accountable forms and the funds are authorized to be treated as
revolving funds.
3. Collection from sale of obsolete, unserviceable and unnecessary
equipment authorized for agency use. They are required to be
remitted to the Bureau of Treasury and are to be used by the
agency upon receipt of Special Allotment Release Order (SARO)
and NCA.

4. Non-income collections authorized for agency use, but
required to be remitted to the BTr and to be used by the
agency upon receipt of the NCA. These are as follows:
 Inter-agency fund transfers
 Receipts from various agencies intended for specific
purpose/project as shown in the Memorandum of
Agreement/Understanding
5. Collections which are subject to refund and are deposited
with the BTr.
 Performance/bidders/bail bonds
 Guaranty deposits

6. Collection not authorized for agency use but with related
asset/liability accounts recorded in the RA books. Examples are::
 Proceeds from sale of assets not authorized for agency use
 Proceeds from sale of confiscated properties and conveyances
 Grants and donations
 Refund of overpayment of expenses
 Refund of cash advances
 Cash settlement of disallowances and suspensions
 Restitution of cash shortages recorded in the books

6. Collections authorized for agency use to defray actual
expenses incurred and paid for the purpose these were
collected. The excess income shall be remitted to the BTr
and recorded in the RA books. Examples are collections for
seminar and convention fees.

Illustrative Accounting Entries - Typical transactions of Central/Regional Offices and Operating Units
(CO/RO/OU) receiving Notice of Cash Allocation direct from DBM.
REGULAR AGENCY BOOKS
Transactions

Beginning Balances

CO/RO/OU
Account Title

Office Equipment
Accounts Payable
Government Equity

Account
Code Debit Credit
222 1,000
401
350
501
650

REGULAR AGENCY BOOKS
CO/RO/OU

Transactions

Account Title

Receipt of allotment and NCA
1. Receipt of allotment for:
Allotment Class
CO
MOOE
PS
FE
Total

GAA

3,340
1,010
550
100
5,000

CA 186

Credit

Posting in allotment column of the
Registry of Allotments and ObligationsCapital Outlay, Maintenance and Other
Operating Expenses, Personal Services
and Financial Expenses

55
Cash - National Treasury, MDS
Subsidy Income from National Government

P 500

4. Recording of expenses
Salaries
PERA
Additional Compensation
Total
Less: Salary Deductions.
Withholding tax
Life & Ret. premiums
PAGIBIG premiums
PHILHEALTH premiums
GSIS-Salary loan
Employees' Association
Net Amount

Debit

55

2. Receipt of Notice of Cash Allocation
from DBM - P4,500
Payment of Expenses
3. Obligation for PS -

Account
Code

102
601

4,500

801
804
805
428
410
411
412
413
450

440
30
30

4,500

Posting in obligation column of Registry
of Allotments and Obligations - Personal
Services
440
30
30
500
50
30
5
3
2
10

100
400

Salaries and Wages - Regular Pay
PERA
Additional Compensation
Due to Officers and Employees
Withholding Tax Payable
GSIS Payable
PAG-IBIG Payable
PHILHEALTH Payable
Other Payables

400
50
32
5
3
10

REGULAR AGENCY BOOKS
Transactions

5. Grant of Cash Advance for payroll - P400

6. Liquidation of Cash Advance
7. Remittance of Salary Deductions

CO/RO/OU
Account Title

Account
Code Debit Credit

Cash - Disbursing Officers
Cash - National Treasury, MDS

107
102

400

Due to Officers and Employees
Cash - Disbursing Officers

428
107

400

GSIS Payable
PAG-IBIG Payable
PHILHEALTH Payable
Other Payables
Cash - National Treasury, MDS

411
412
413
450
102

32
5
3
10

400

400

50

REGULAR AGENCY BOOKS
Transactions

8. Obligation for government share
CA 186 - Life & Ret. Contribution
30
GAA - PAG-IBIG Contribution
5
GAA - PHILHEALTH Contribution 3
38
9. Remittance of Govt. Share
CA 186 - Life & Ret. Contribution
30
GAA - PAG-IBIG Contribution
5
GAA - PHILHEALTH Contribution 3
38

CO/RO/OU
Account Title

Account
Code Debit Credit

Posting in obligation column of Registry
of Allotments and Obligations - Personal
Services

Life and Retirement Insurance Contributions
PAG-IBIG Contributions
PHILHEALTH Contributions
Cash - National Treasury, MDS

817
818
819
102

30
5
3
38

REGULAR AGENCY BOOKS
CO/RO/OU

Transactions

Receipt of Bills / Claim
10. Obligation for:
Rent ( for 1 year)
Office Supplies
MERALCO bill
PLDT bill
Travelling expense of
Mr. Alex Cruz
TOTAL

Account Title

70
150
50
40

Account
Code
Debit

Posting in obligation column of Registry of
Allotments and Obligations - Maintenance
and Other Operating Expenses

110
420

11. Payment of one year rent
(July 1, 2002 to June 30, 2003)

Prepaid Rent
Cash - National Treasury, MDS

161
102

70

12. Advance payment to Procurement
Service (PS) for office supplies

Due from NGAs
Cash - National Treasury, MDS

130
102

150

13. Receipt of office supplies
and invoice from Procurement Service.

Office Supplies Inventory
Due from NGAs

149
130

150

14. Payment of MERALCO bill

Electricity
Cash - National Treasury, MDS

835
102

50

Telephone/Telegraph and Internet
Cash - National Treasury, MDS

837
102

40

15. Payment of PLDT bill

Credit

150

70

150

150

50

40

REGULAR AGENCY BOOKS
Transactions

CO/RO/OU
Account Title

Account
Code Debit Credit

16. Granting of cash advance for travel of
Mr. Alex Cruz

Due from Officers and Employees
Cash - National Treasury, MDS

128
102

110

17. Liquidation of cash advance for travel of
Mr. Alex Cruz

Traveling Expense - Local
Due from Officers and Employees

831
128

98

18. Refund of excess cash advance for travelling
expense of Mr. Alex Cruz

Cash - Collecting Officers
Due from Officers and Employees

106
128

12

19. Adjustment of obligation by P12 for refund
of excess advance for traveling expense

Negative posting in obligation column of
Registry of Allotments and Obligations Maintenance and Other Operating Expenses

20. Deposit of collection from excess advance
to BTr

Subsidy Income from National Government
Cash - Collecting Officers

601
106

12

110

98

12

12

REGULAR AGENCY BOOKS
CO/RO/OU

Transactions

Account Title

Petty Cash Fund
21. Obligation for Petty Cash Fund (PCF)
for - P35

Account
Code Debit Credit

Posting in obligation column of
Registry of Allotments and Obligations Maintenance and Other Operating Expenses

22. Establishment of Petty Cash Fund (PCF)

Petty Cash Fund
Cash - National Treasury, MDS

23. Obligation of P30 for replenishment
of Petty Cash Fund

Posting in obligation column of
Registry of Allotments and Obligations Maintenance and Other Operating Expenses

24. Replenishment of Petty Cash Fund
Bond paper
Postage stamps

Office Supplies Expenses
Postage and Deliveries
Cash - National Treasury, MDS

20
10
30

105
102

35

849
838
102

20
10

35

30

REGULAR AGENCY BOOKS
Transactions

CO/RO/OU
Account Title

25. Closing of the Petty Cash Fund within the
year due to retirement of the PCF Custodian

Cash - Collecting Officers
Petty Cash Fund

26. Adjustment of obligation for refunded PCF
per ALOBS supported by Official Receipt

Negative posting in obligation
Registry of Allotments and Obligations Maintenance and Other Operating Expenses

27. Deposit of collection from refund of
Petty Cash Fund

Subsidy Income from NG
Cash - Collecting Officers

28. Obligation for Petty Cash Fund for - P35
for the newly designated PCF Custodian

Posting in obligation column of
Registry of Allotments and Obligations Maintenance and Other Operating Expenses

29. Establishment of Petty Cash Fund for
the newly designated PCF Custodian

Petty Cash Fund
Cash - National Treasury, MDS

Account
Code Debit Credit
106
105

5

601
106

5

105
102

35

5

5

35

REGULAR AGENCY BOOKS
Transactions

Purchase of Equipment
30. Obligation for office equipment per Purchase
Order - P100

31. Payment to Procurement Service for office equipment

CO/RO/OU
Account Title

Account
Code Debit

Credit

Posting in obligation column of
Registry of Allotments and Obligations Capital Outlay
Due from NGAs
Cash - National Treasury, MDS

130
102

100

32. Receipt of office equipment based on Invoice/
delivery receipt

Office Equipment
Due from NGAs

222
130

100

33. Obligation prior to approval of purchase order for
IT Software - P400

Posting in obligation column of
Registry of Allotments and Obligations Capital Outlay

34. Receipt of IT Software based on invoice/delivery
receipt from Computer Technologies (corporation)

IT Equipment and Software
Accounts Payable

215
421

400

35. Payment of IT Software to Computer Technologies
Gross
400
Less: Withholding Tax (VAT)
36
364

Accounts Payable
Cash - National Treasury, MDS
Withholding Taxes Payable

421
102
410

400

100

100

400

364
36

REGULAR AGENCY BOOKS
CO/RO/OU

Transactions

Account Title

Construction of Building
36. Obligation for building prior to the signing of the
contract - P700

Account
Code
Debit

Posting in obligation column of
Registry of Allotments and Obligations Capital Outlay

37. Receipt of cash from the contractor paid
as performance bond

Cash - Collecting Officers
Performance/Bidders/Bail Bonds Payable

106
414

50

38. Deposit of ( cash) performance bond
to BTr thru AGDB

Due from National Treasury
Cash - Collecting Officers

134
106

50

39. Payment of 15% of contract amount as advances
to contractor - P700 x 15%

Advances to Contractors
Cash - National Treasury, MDS

168
102

105

40. Receipt of 1st progress billing for building
50% of P700
Less: Recoupment
Net Amount

Construction in Progress - Agency Assets
Accounts Payable
Advances to Contractors

230
401
168

350

Accounts Payable
Cash - National Treasury, MDS
Guaranty Deposits Payable
Withholding Taxes Payable

421
102
408
410

300

41. Payment of 1st progress billing for building
Accounts Payable
Less: 10% Retention
35
Withholding Tax
27
Net Amount

Credit

P350
50
P300

300
62
238

50

50

105

300
50

238
35
27

REGULAR AGENCY BOOKS
CO/RO/OU

Transactions

42. Receipt of final billing for building
50% of P700 (delayed completion)
Less: Liquidated Damages
Net Amount
Less: Recoupment
Amount Due

Account Title

P350
10
P340
55
P285

Construction in Progress - Agency Assets
Accounts Payable
Advances to Contractors

Account
Code Debit
230
401
168

340
285
55

43. Adjustment of RAOCO by P10 to reduce original
amount of obligation due to liquidated damages

Posting in obligation column of
Registry of Allotments and Obligations Capital Outlay

44. Final payment for building
Accounts Payable
Less: 10% Withholding Tax (VAT)
Net Amount

Accounts Payable
Cash - National Treasury, MDS
Withholding Taxes Payable

401
102
410

285

Buildings
Construction in Progress - Agency Assets

204
230

690

45. Turn-over & acceptance of building
Contract Amount
Less: Liquidated Damages
Net Cost

285
32
253

700
10
690

Credit

253
32

690

REGULAR AGENCY BOOKS
Transactions

Transfer of Funds to Implementing Agency
46. Obligation prior to approval of transfer of cash to
another agency for construction of building-P250

47. Issuance of check to implementing agency (IA)

48. Receipt of liquidation reports/turn-over of building
by IA - P250

CO/RO/OU
Account Title

Account
Code Debit Credit

Posting in obligation column of
Registry of Allotments and Obligations Capital Outlay
Due from NGAs
Cash - National Treasury, MDS

130
102

250

Buildings
Due from NGAs

204
130

250

250

250

REGULAR AGENCY BOOKS
Transactions

Grants and Donations
52. Obligation of amount for tuition fees of employees
(under scholarship grants) - P70

CO/RO/OU
Account Title

Account
Code Debit Credit

Posting in obligation column of
Registry of Allotments and Obligations Maintenance and Other Operating Expenses

53. Recording of the bill from educational institution for
tuition fees of scholars

Grants and Donations
Accounts Payable

889
401

70

54. Payment of tuition fees of scholars

Accounts Payable
Cash - National Treasury, MDS

401
102

70

889
102

50

55. Obligation of stipend/book allowances
of scholars - P 50

Posting in obligation column of
Registry of Allotments and Obligations Maintenance and Other Operating Expenses

56. Payment of stipend/book allowance to scholars

Grants and Donations
Cash - National Treasury, MDS

70

70

50

REGULAR AGENCY BOOKS
Transactions

Payment thru ADA
57. Receipt of NCA for PY accounts payable - P350

58. Payment of PY accounts payable - P200

CO/RO/OU
Account Title

Account
Code Debit Credit

Cash - National Treasury, MDS
Subsidy Income from National Government

102
601

350

Accounts Payable
Cash - National Treasury, MDS

401
102

200

350

200

REGULAR AGENCY BOOKS
CO/RO/OU

Transactions

Account Title

Public Infrastructures
59. Receipt of cash from contractor paid as performance
bond for the construction of roads
60. Deposit of cash (performance bond) to BTr thru AGDB

106
414

150

Due from National Treasury
Cash - Collecting Officers

134
106

150

168
102

300

232
401
168

1,000

401
102
410
408

850

Posting in obligation column of
Registry of Allotments and Obligations Capital Outlay

62. Payment of 15% of contract amount for the
advances to the contractor for the construction of
roads P2,000 x 15%

Advances to Contractors
Cash - National Treasury, MDS

63. Receipt of progress billing for construction of roads
Construction in Progress - Roads,
50% of P2,000
1000 Highways and Bridges
Less: Recoupment
150
Accounts Payable
Net Amount
850
Advances to Contractors

850
190
660

Debit

Cash - Collecting Officers
Performance/Bidders/Bail Bonds Payable

61. Obligation for construction of roads prior to signing of
contract - P2,000

64. Payment of bill for the construction of roads
Accounts Payable (1,000 -150)
Less: Withholding Tax
90
10% Retention
100
Net Amount

Account
Code

Accounts Payable
Cash - National Treasury, MDS
Withholding Taxes Payable
Guaranty Deposits Payable

Credit

150

150

300

850
150

660
90
100

REGULAR AGENCY BOOKS
CO/RO/OU

Transactions

65. Presentation of final billing for roads
50% of P2,000
Less: Liquidated Damages
Net Cost
Less: Recoupment
Amount Due

Account Title

1,000
50
950
150
800

Construction in Progress - Roads,
Highways and Bridges
Accounts Payable
Advances to Contractors

Account
Code Debit

232
401
168

950
800
150

66. Adjustment of RAOCO by P50 to reduce original
amount of obligation

Negative posting in obligation column of
Registry of Allotments and Obligations Capital Outlay

67. Payment of final bill for the construction of roads
Accounts Payable
Less: Withholding Tax
86
10% Retention
95
Net Amount

Accounts Payable
Cash - National Treasury, MDS
Withholding Taxes Payable
Guaranty Deposits Payable

401
102
410
408

800

Public Infrastructures
Construction in Progress - Roads,
Highways and Bridges

243

1,950

68. Turn-over and acceptance of roads
Contract amount
Less: Liquidated Damages
Net Cost

800
181
619

2,000
50
1,950

232

Credit

619
86
95

1,950

REGULAR AGENCY BOOKS
CO/RO/OU

Transactions

Remittance of Withholding Taxes Thru TRA
69. Remittance of Withholding Tax thru TRA
Salaries
IT Software (Corporation)
Building (Corporation)
Roads (Corporation)
Total

Account Title

50
36
59
176
321

Withholding Taxes Payable
Subsidy Income from National Government

Release of Performance Bond
70. Receipt of NCA for deposited performance bonds receivedCash-National Treasury, MDS
from contractors for the construction of the following:
Due from National Treasury
Building
Roads
Total
71. Refund of performance bonds to contractors .

Account
Code Debit Credit

410
601

321

102
134

200

414
102

200

321

200

50
150
200
Performance/Bidders/Bail Bonds Payable
Cash-National Treasury, MDS

200

REGULAR AGENCY BOOKS
CO/RO/OU

Transactions

Account Title

Refund of Retention Fees
72. Refund of retention fees to contractors .
Building
Roads
Total

Guaranty Deposits Payable
Cash-National Treasury, MDS

Account
Code Debit Credit

408
102

406

849
149

140

406

P35
371
406

Issuance of Supplies and Materials
73. Receipt of the Report of Supplies and Materials Issued Office Supplies Expenses
from the Property/Supply Unit
Office Supplies Inventory
office supplies - P140

140

Illustrative Accounting Entries - Typical transactions of Central/Regional Offices and Operating Units
(CO/RO/OU) receiving Notice of Cash Allocation direct from DBM and ROs/OUs receiving funding checks from CO/RO.
CENTRAL OFFICE (CO)
Transactions

Account Title

Account
Code

REGIONAL OFFICE (RO)
Debit

Credit

Account Title

OPERATING UNITS

Account
Debit
Code

Credit

Account Title

Account
Debit Credit
Code

Receipt of Allotment/NCA andTransfer of Subsidy
1. Receipt of allotment for:
Allotment Class
CO
MOOE
PS
Total
2. Receipt of Notice of Allocation
from DBM

CO
1,800
260
200
2,260

RO

250
250

CO
RO
2,000 250

3. Release of sub-allotment to Regional Offices
Allotment Class
MOOE
CO
Total

RO
160
1,500
1,660

4. Release of Letter Advice of Allotment to OU
Allotment Class
MOOE
CO
Total

OU
50
700
750

5. Transfer of subsidy to Regional
Office thru funding check or fund
transfer

OU Cash - National Treasury, MDS
150 Subsidy Income from National Government

Posting in allotment column of
Registry of Allotments and ObligationsMaintenance and Other Operating
Expenses, Personal Services

102
601

2,000

Negative posting in allotment column of
Registry of Allotments and ObligationsCapital Outlay

Cash - National Treasury, MDS
2,000 Subsidy Income from National Government

Posting in allotment column of
Registry of Allotments and ObligationsMaintenance and Other Operating
Expenses, Personal Services

102
601

250

Cash - National Treasury, MDS
250 Subsidy Income from National Government

102
601

150

110
603

600

150

Posting in allotment column of
Registry of Allotments and ObligationsCapital Outlay

Negative posting in allotment column of
Registry of Allotments and ObligationsCapital Outlay, Maintenance and
Other Operating Expenses

Subsidy to Regional Offices/Staff Bureaus
Cash - National Treasury, MDS

538
102

1,400

Cash in Bank-Local Currency, Curr. Acct.
1,400 Subsidy from Central Office

Posting in allotment column of
Registry of Allotments and ObligationsCapital Outlay, Maintenance and
Other Operating Expenses

110
602

1,400

539
110

600

1,400

1,400

6. Transfer of subsidy to Operating
Unit thru funding check or fund
transfer
Payment of Expenses
7. Obligation for Personal Services

Posting in allotment column of
OU Registry of Allotments and ObligationsCapital Outlay, Maintenance and Other
Operating Expenses, Personal Services
150
150

Subsidy to Operating Units
Cash in Bank-Local Currency, Curr. Acct.

Cash in Bank-Local Currency, Curr. Acct.
600 Subsidy from Regional Office/Staff Bureau

600

CO
140

RO
250

OU Posting in obligation column of
130 Registry of Allotments and ObligationsPersonal Services

Posting in obligation column of
Registry of Allotments and ObligationsPersonal Services

Posting in obligation column of
Registry of Allotments and ObligationsPersonal Services

600



In accounting for allocations, allotments and obligations,
some of the terms often used are the following:
•

Appropriation – an authorization under past Acts of
Congress or other legislative enactments, for payments
to be made with funds of the government under
specified conditions and/or for specific purposes.

•

Allotments – authorization issued by the DBM to an
agency to enable it to incur obligations up to a specified
amount that is within a legislative appropriation.
Allotments are issued based on the agency budget
matrix (ABM). They are recorded by posting in the
Registries of Allotment and Obligations (RAO). For this
purpose, there are four registries used. They are as
follows:
• RAOPS
• RAOMO
• RAOFE
• RAOCO

•

•

Allotment Release Order (ARO) – a formal document
issued by DBM to the head of an agency containing the
authorization, conditions and amount of agency
allocation. It may be in the form of the ABM or the SARO.
ABM – a document showing the disaggregation of
agency expenditures into components like, among
others, by source of appropriation, by allotment class
and by need of clearance.

•

•

NCA – an authorization issued by the DBM to an agency
to withdraw cash from BTr to pay expenses incurred,
purchases of materials, purchases of PPE, payment of
payables and other authorized disbursements thru the
issuance of Modified Disbursement System (MDS)
checks.
Obligation – commitments by a 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. An obligation is recognized
when contracted for and is recorded by a memorandum
entry in the RAO.





MDS Checks. These are issued by national government agencies
chargeable to the account of the BTr maintained with different
MDS-Government Servicing Banks (GSBs). They are given to the
agencies based on their cash allocation per NCA and their
issuance reduces the amount of cash available per NCA. MDS
Checks issued are credited to Cash – NT, MDS.
Commercial Checks. These are issued for disbursements out of
the agency’s receipts/income that is authorized to use. Agencies
are required to deposit their receipts/income in a current
account in the AGDB. Upon said deposit, the account Cash in
Bank – Local Currency, Current Account is debited so that upon
issuance against the current account, the credit is to the same
account.



Adjusting entries are similar to those made under
commercial accounting. They include those for accrual of
income and expenses, prepaid expenses, deferred income
tax and provision for depreciation.

REGULAR AGENCY BOOKS
CO/RO/OU

Transactions

Account Title

Account
Code Debit Credit

Adjusting Entries
74. Recording of depreciation for the following:
Depreciation - Buildings
Cost Depn. Depreciation - IT Equipment
Buildings
690 35 Depreciation - Office Equipment
IT Equipment
400 40
Acc. Depn. - Buildings
Office Equipment
100 10
Acc. Depn. - IT Equipment
Total
1,190 85
Acc. Depn. - Office Equipment

904
915
922
304
315
322

35
40
10

75. Rent expense for the year

841

35

Rent Expense
Prepaid Rent

161

35
40
10

35





As in commercial accounting, closing entries are made
whereby income and expenses account are closed to
Income and Expense Summary. Under the NGAS, the latter
is closed to Retained Operating Surplus, which in turn is
closed to Government Equity. The latter is reduced upon
transfer of public properties/infrastructures to their
registries. In addition to these, an entry is made for the
unused NCA.
Unused NCA. Whatever cash allocation is still unused at the
end of the year has to be reverted back to the national
treasury. This is due to the DBM policy that NCA is valid only
within the year of issue. The exception of NCA for accounts
payable, which is valid for one month after its issuance.

REGULAR AGENCY BOOKS
Transactions

CO/RO/OU
Account Title

Account
Code

Debit

Credit

CLOSING ENTRIES
1.

Subsidy Income from National Government
Cash-National Treasury, MDS

601
102

187

2. Subsidy Income from the National Government
and Income

Subsidy Income from National Government
Income and Expense Summary

601
533

2,667

3. Expenses

Income and Expense Summary
Salaries and Wages-Regular Payroll
PERA
Additional Compensation
Life and Ret. Insurance Contribution
PAG-IBIG Contribution
PHILHEALTH Contribution
Traveling Expense, Local
Training and Seminar Fees
Electricity
Telephone/Telegraph and Internet
Postage and Deliveries
Rent Expenses
Office Supplies Expenses
Grants and Donations
Depreciation - Buildings
Depreciation - IT Equipment
Depreciation - Office Equipment

535
801
804
805
817
818
819
831
833
835
837
838
841
849
890
904
915
922

1,131

Income and Expense Summary
Retained Operating Surplus

532
534

1,536

Retained Operating Surplus
Government Equity

534
501

1,536

Government Equity
Public Infrastructures

501
243

1,950

4.

5.

Unused NCA

Income and Expense Summary

Retained Operating Surplus

6. Transfer of Public Infrastructures account to the
Registry of Public Infrastructures

187

2,667

440
30
30
30
5
3
148
30
50
40
10
70
40
120
35
40
10

1,536

1,536

1,950

REGISTRY OF ALLOTMENTS AND NOTICE OF CASH ALLOCATION

Agency
Sheet No.:
Date

Reference

Allotment
Received

Notice of Cash Allocation
Received
Utilized
Balance