CHAPTER 6

DISBURSEMENT
Summary Report

Reported by: Ann Vernadette V. Antonio Leanne Kristhel V. Magbitang Jenalyn R. Jumaquio
This chapter covers the rules and regulations to be followed in the disbursement of public funds, the
monitoring of receipts and utilization of NCA/NTA, preparation and processing of DV/Payroll; preparation and
issue of checks; payment by cash; granting, utilization and liquidation/replenishment of cash advances; payment
through ADA; remittances of taxes withheld through TRA; availment of foreign loans through suppliers
credit/constructive cash; and payment of operating requirements on FSPs through CDC. First of all the covered
topics are the terms to be used in disbursements, the processes, and documentary requirements for transactions.
This will also tackle the difference between the modes of disbursements and all the books, notes, forms and
records needed to be maintained as well as the cash advances, cash advance processes and disbursement of cash
advances.
Cash advances for travel only covers those that are urgent and extremely necessary that will be beneficial
to the government agency and the country itself. Take note that no government fund shall be used for the personal
expenses of each and every official or employee, except in the case of training, seminar, or conference abroad,
provided that there are no uniformed personnel that will be sent to foreign commitments when they are due to
retire within one year after the said foreign travel. The grant of clothing allowance in all types of trip are
prohibited. The amount to be granted to the authorized personnel shall be accounted as "Advances to Officers and
Employees." No additional cash advance shall be granted to any official or employee unless the previous cash
advance given to him/her for travel is first liquidated and accounted for in the books. If there is an instance that
travel expenses incurred is greater than the cash advance, the officers/employees who made the travel shall
prepare the liquidation report and shall be submitted to liquidate the cash advance previously granted and a
disbursement voucher shall be prepared to claim the reimbursement of the deficiency in amount. Cash advances
for petty cash fund shall be sufficient for the recurring petty operating expenses, and shall be maintained using
Imprest System. The petty cash fund shall be kept separately and not be used for the payment of regular expenses
such as rentals, subscriptions, light and water bills, and the like. Splitting of transactions to avoid exceeding the
ceiling of P15,000 shall not be allowed. The fund shall be closed only upon termination, separation, retirement or
dismissal of the Petty Cash Fund Custodian, who is primary responsible in maintaining the cash fund.
Accounting for Overpayment are sometimes overpayment or even double payment of expenditures do
happen in agencies. These could be avoided with the institution of proper controls but some could not be avoided
because of built-In procedures. The accounting entries for overpayments has two part: Overpayment taken up as
receivable and Refund of overpayment not taken up as receivable. Disbursement through List of Due and
Demandable Accounts Payable – Advice to Debit Account (LDDAP – ADA) is the use mode of settlement of
accounts payable due the creditors/payee of all NGA’s and their OUs. Some exclusions from the implementation
of ExMDPS shall be followed. Signatories in LDDAP and RADAI shall be certified correct and approve by all
respected authorized persons. Accounting books, records, forms and reports to be prepared and maintained shall
be recorded chronologically in the CkADADRec and shall be in the appropriate column. All kinds of receipts
shall be monitor with acceptable evidence. The documentary requirements for common government transactions
depending on the nature of expenses shall be complied with as prescribed under COA. The procedures for
disbursement through LDDAP – ADA shall prepared and checked by different respective offices, divisions or
units. All different type and way of disbursement such as through electronic Modified Disbursement System,
Cashless Purchase Card System, Tax Remittance Advice, Inter-Agency Transferred Funds, Foreign-based
Government Agencies and Direct Payment Method shall be issued, modified and inspected by the respective
authority. The Financial Statements Presentation shall be in accordance with Financial Reporting Manual.