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Dir. Marietta M. Lorenzo Government Accountancy Sector

Updates on. Accounting & Related Matters. Dir. Marietta M. Lorenzo Government Accountancy Sector. OUTLINE.

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Dir. Marietta M. Lorenzo Government Accountancy Sector

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  1. Updates on Accounting & Related Matters Dir. Marietta M. Lorenzo Government Accountancy Sector

  2. OUTLINE I. Framework on Keeping the General Accounts (KGA) of the National Government (NG)II. Exposure Draft Circulars a. Guidelines in the Keeping of the General Accounts of NG b. Guidelines on the Enhancement of Some Policies on the New Government Accounting System (NGAS)

  3. OUTLINE III. Harmonization of Philippine Government Accounting Standards (PGAS) with International Public Sector Accounting Standards (IPSAS) a. Revision of NGAS Manual and Chart of Accounts

  4. OUTLINE IV. Accounting Issues/Concerns and Results of Review of CY 2009 FS/Reports V. Monitoring of CY 2010 Quarterly Reports, by Province /City and Other Documents

  5. I. Framework on KGA of NG

  6. LEGAL BASIS Mandate pursuant to the 1987 Philippine Constitution: Section 2 (1), Article IX-D The Commission on Audit shall keep the general accounts of the Government and preserve the vouchers and other supporting documents relative to such account.

  7. I. KEEPING THE GENERAL ACCOUNTS (KGA) OF THE GOVERNMENTCONTEMPORARY INTERPRETATION • Takes into account challenges in the accounting profession which requires due regard for international principles and standards of accounting; • Makes full use of advances in technology through computerized accounting and budget systems and shared data base tofacilitate preparation of financial reports;

  8. KEEPING THE GENERAL ACCOUNTS (KGA) OF THE GOVERNMENTCONTEMPORARY INTERPRETATION • Mindful of the constitutional mandate and the spirit of the law which vest in COA the authority and responsibility to account for government appropriations and expenditures and to present a consolidated financial report;

  9. KEEPING OF THE GENERAL ACCOUNTS FRAMEWORK GIFMIS ABM/SARO/NCA GIFMIS DBM NGAs GIFMIS FS/FR/TB/SAOB GAA/ABM/SAROs/ NGAS, eNGAS, eBudget Monitoring FS/FR/TB/SAOB/ROI KGA GIFMIS GIFMIS Review Results SAAB COA GIFMIS

  10. GIFMIS NCA GAA GIFMIS Review Results GIFMIS BESF/NEP FS/FR/TB/SAOB LAR D/MAD GIFMIS GIFMIS Findings RFR ABM/SAROs FS/FR/TB/SAOB/ROI Cash Ceiling NGAS, eNGAS, eBudget Monitoring LDC ACIC NCA GIFMIS BRS ABM/SARO/ Bank Statement KEEPING OF THE GENERAL ACCOUNTS EXPANDED FRAMEWORK AGDB DBM CSAAB COA DOF-BTr NGAs AGDB

  11. COA KGA OVERVIEW GAA & Sp. Laws SAOB SBUB ROI ABM/ SARO SAA SASPF JEV JEV JAA RAPAL GJ GL RASPF SAAB (DBM) SAAOB TB SAOB (NGAs) FR/FS LEGEND: DBM – Department of Budget and Management NGAs – National Government Agencies FR – Financial Report FS- Financial Statements GJ – General Journal GL – General Ledger JAA – Journal of Appropriations and Allotments JEV – Journal Entry Voucher RAPAL – Registry of Appropriations and Allotments RASPF – Registry of Appropriations for Special Purpose Funds ROI – Report of Income SAA – Summary of Appropriations and Allotments SAAB - Statement of Appropriations, Allotments and Balances SASPF – Summary of Appropriations for Special Purpose Funds SAOB – Statement of Allotments, Obligations and Balances SAAOB – Statement of Appropriations, Allotments, Obligations and Balances SBUB – Statement of Budget Utilization and Balances TB – Trial Balance

  12. II. Exposure Draft of Circulars

  13. II.a Joint Circular: COA,DBM and DOF 1.0 Rationale The Commission on Audit (COA) is mandated under Section 2 (1), Article IX (D) of the 1987 Philippine Constitution “to keep the general accounts of the Government”. This constitutional mandate vests in COA the authority and responsibility to account for total appropriations and expenditures. It is imperative for COA to monitor, account and verify the overall budget of the national government.

  14. Joint Circular: COA,DBM and DOF 1.0 Rationale The full use of advances in technology through computerized systems and shared databases will facilitate the timely preparation of a consolidated financial report for the national government showing how the budget was allocated, released and utilized.

  15. Joint Circular: COA,DBM and DOF 2.0 General Guidelines 2.1 Budgetary information/transactions shall be recorded in appropriate registries. 2.1.1 The Registry of Appropriations, Allotments and Balances (RAAB) (Annex A) shall be maintained by the Department of Budget and Management (DBM) to control and monitor appropriations and allotments.

  16. Joint Circular: COA,DBM and DOF 2.1.2 The Registry of Allotments and Obligations (RAO) shall continue to be maintained by the national government agencies (NGAs) to control and monitor allotments and obligations. For agencies authorized to use income, the Registry of Budget and Utilization (RBU) shall also be maintained.

  17. Joint Circular: COA,DBM and DOF 2.2 Budgetary reports shall be generated from the different registries as follows: 2.2.1 The Statement of Appropriations, Allotments and Balances (SAAB – Annex D) by department/agency from the RAAB; 2.2.2 The Statement of Allotments, Obligations and Balances (SAOB -Annex E) from the RAOs;

  18. Joint Circular: COA,DBM and DOF 2.2.3 The Statement of Budget, Utilization and Balances (SBUB – Annex F) from the RBU; and 2.2.4 The Statement of Appropriations, Allotments, Obligations and Balances (SAAOB -Annex G) from the RAPAL and RASPF combined with data from the SAOB.

  19. Joint Circular: COA,DBM and DOF 2.3 Books of accounts shall be kept by COA to record the appropriations, allotments and balances reflected in the RAPAL and RASPF. Data on actual income, obligations and related accounts shall also be recorded in the COA books based on financial reports from the agencies.

  20. Joint Circular: COA,DBM and DOF 3.0 Specific Responsibilities 3.1 The DBM shall: 3.1.1 Transmit to GAS, COA, complete and timely budget documents and reports as bases for recording in the books of accounts. a. Copies of GAA and other special appropriation laws;

  21. Joint Circular: COA,DBM and DOF b. Copies of ABMs, SAROs and other documents related to augmentation/ transfer/realignment of appropria- tions/allotments together with the Transmittal List (Annex H) issued by DBM central and regional offices immediately upon issuance to the agencies but not beyond ten days from end of the month;

  22. Joint Circular: COA,DBM and DOF 3.1.2 Maintain RAAB by department/ agency/region; 3.1.3 Prepare Statement of Appropriations, Allotments and Balances (SAAB) showing data by department/agency/region and submit to DBM Central Office for consolidation;

  23. Joint Circular: COA,DBM and DOF 3.1.4 Consolidate the central and regional offices SAAB and submit a Consolidated Statement of Appropriations, Allotments and Balances (CSAAB – Annex I) by department/agency to GAS, COA within 30 days after each quarter for reconciliation; 3.1.5 Effect appropriate adjustments based on the result of reconciliation of budget data with GAS, COA;

  24. Joint Circular: COA,DBM and DOF 3.1.6 Provide GAS, COA, access to the DBM e-Budget system to facilitate the monitoring and recording of budget/ appropriations and allotments; and 3.1.7 Ensure compliance with the cut-off date for the issuance of SAROs at yearend.

  25. Joint Circular: COA,DBM and DOF 3.2 Bureau of the Treasury (BTr) shall: 3.2.1 Prepare and submit to GAS, COA on or before February 14 of the ensuing year the following reports: a. Report of Current Year’s Receipts from Borrowings (Annex J); b. Analysis of Loans Payable – Foreign (Annex K-1), Analysis of Loans Payable – Domestic (Annex K-2), and Analysis of Bonds

  26. Joint Circular: COA,DBM and DOF Payable – Foreign (Annex K-3) and Analysis of Bonds Payable –Domestic (Annex K-4); and c. Report of Income (National Government and Regular Agency Books)

  27. Joint Circular: COA,DBM and DOF 3.3 National Government Agencies (NGAs): 3.3.1 The budget Unit shall: a. Continue to maintain the RAO and the RBU by allotment class and by program, activity and project; b. Provide the Chief Accountant access to the RAO/RBU any time for certification as to availability

  28. Joint Circular: COA,DBM and DOF of fund and correctness of SAOB, Statement of Budget, Utilization and Balances (SBUB), and other related reports. c. Prepare the following quarterly reports: 1. Statement of Allotments, Obligations and Balances; 2. Detailed Statement of Obligations, Disbursements and Balances (Annex L);

  29. Joint Circular: COA,DBM and DOF 3. List of Allotment Releases, by ABM and SAROs (Annex M); and 4. List of Not Yet Due and Demandable Obligations, Current Year and Prior Years (Annex N).

  30. Joint Circular: COA,DBM and DOF d. For agencies authorized to use income, prepare the following additional quarterly reports: 1. Statement of Budget, Utilization and Balances; and ; 2. Detailed Statement of Utilization, Disbursements and Balances (Annex O);

  31. Joint Circular: COA,DBM and DOF e. Submit the above financial reports in accordance with the following reporting deadlines, copy furnished the auditor:

  32. Joint Circular: COA,DBM and DOF 3.3.2 The Accounting Unit shall: a. Submit separate Report of Income for NG and RA books on a quarterly basis; and b. Sign the SAOB, DSODB, SBUB, DSUDB jointly prepared with the Budget Unit.

  33. Joint Circular: COA,DBM and DOF 3.4 COA – GAS shall: 3.4.1 Record in the RAPAL and RASPF (a) budget/appropriations and (b) allotment releases to agencies, based on GAA, Special Laws, ABMs and SAROs; 3.4.2 Record in the books of accounts (a) budget/appropriations, (b) allotment releases to agencies, and (c) unallotted appropriations

  34. Joint Circular: COA,DBM and DOF (d) expenditures/obligations incurred, and (e) unexpended allotments based on SAOB; (f) income not authorized for use based on the Report of Income of NGAs; and (g) prior years’ adjustments affecting the surplus of the government;

  35. Joint Circular: COA,DBM and DOF 3.4.3 Coordinate and reconcile pertinent data on appropriations and allotments with the DBM based on SAAB; 3.4.4 Analyze and reconcile allotments with agencies based on SAOB and coordinate discrepancies noted;

  36. Joint Circular: COA,DBM and DOF 3.4.5 Prepare a report on the results of the review of budget documents and control of budget/appropriations; 3.4.6 Prepare the trial balances and financial statements based on the COA books maintained, and Statement of Appropriations, Allotments, Obligations and Balances.

  37. Joint Circular: COA,DBM and DOF 3.5 COA Auditing Unit shall: 3.5.1 Verify the completeness of the budgetary documents recorded in the RAOs, coordinate with GAS, COA for discrepancies noted and inform the agency accordingly; and

  38. Joint Circular: COA,DBM and DOF 3.5.2 Verify the correctness and completeness of entries in the RAOs and data shown in the SAOB/SBUB and DSODB/ DSUDB submitted by NGAs to GAS, COA.

  39. Joint Circular: COA,DBM and DOF 4.0 Repealing Clause All circulars, memoranda and other issuances or parts thereof which are inconsistent with the provisions of this Circular are hereby repealed/modified accordingly.

  40. Joint Circular: COA,DBM and DOF 5.0 Effectivity This Circular shall take effect January 1, 2011. FLORENCIO B. ABAD CESAR V. PURISIMA Secretary Secretary Department of Budget and Management Department of Finance Reynaldo A. Villar Chairman Commission on Audit

  41. II. b. Draft COA Circular

  42. Subject: Guidelines on the Enhancement of Some Policies on the New Government Accounting System (NGAS)

  43. 1.0 Purpose: The constitutional mandate to promulgate accounting rules and regulation vests in COA authority to prescribe accounting policies and guidelines in the recording of government financial transactions and submission of financial statements and reports.

  44. 1.0 Purpose: In the implementation of NGAS by national government agencies (NGAs) starting January 1, 2002, some accounting issues and concerns were raised by accountants and budget officers. In view thereof, this Circular is issued to enhance some NGAS policies and procedures.

  45. COA Circular 2.0 General Guidelines 2.1 The “Statement of Income and Expenses” shall be modified and renamed “Statement of Subsidy/ Income and Expenses” (Annex A).

  46. COA Circular 2.2 The account “Subsidy Income from National Government” (Account 651) shall be renamed “Subsidy from National Government” and appropriate disclosure shall be included in the Notes to Financial Statements (FS) to show its analysis/breakdown.

  47. 2.3 The lapsed Notice of Cash Allocation (NCA) shall be recorded in the General Journal thru the Journal Entry Voucher. COA Circular

  48. Lapsed NCA – Regular & AP Accounts Dr. Cr. Subsidy from Nat’l. Govt. xx Cash – Nat’l Treas., MDS xx NCA for Trust Liabilities Due from Nat’l. Treas. xx Cash – Nat’l Treas., MDS xx

  49. 2.4 The restoration of the amount of cash equivalent to the total unreleased MDS checks at yearend required in Section 2.3 of COA Government Accounting and FMIS Circular Letter No. 2002-001 dated December 16, 2002 shall be discontinued. The amount shall instead be disclosed in the Notes to Financial Statements. COA Circular

  50. 2.5 Transactions shall be accounted by fund and separate financial statements and reports shall be submitted; and COA Circular

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