SOP Library

SOP NO: FS-CS06.A

Mission: Corporate Administration

Area: Financial Services (FS)

Activity: Cashiering (FS-CS)

Title: Revised SOP on Remittance and Cash Balance Monitoring and Reporting System

Date Approved/Issued: 09/04/95

Date Effective: 09/15/95

Digest:

1. To provide a uniform system of reporting fund remittances and fund balances by the
different field offices/branches to the Central Office.

2. To facilitate the tracking down of fund transfer transactions and confirm their receipt at the
receiving end.
 The system provides policies and procedures in the fast retrieval of data concerning cash
transactions from the field office so as to effectively monitor fund remittances and fund
balances and for a more efficient fund management and control. The timely preparation of the
needed financial reports for the management and interested financial institutions.

SOP No. FS-CS06 - SOP on Remittance and Cash Balance Monitoring and Reporting System
issued and made effective August 1, 1989.

A. Bank Accounts

1. The following set of bank accounts shall be used in depositing, withdrawal and
transferring of funds from t he Central Office to the Field Offices or vice-versa. Bank
accounts indicated herein may be closed or new accounts may be opened depending
on the need of the agency or as may be recommended by the Department of Treasury,
Budget and Fund Management (DTBFM).

a. Drawing Accounts

a.1 Cereal Procurement Fund (CPF) - account used for grains procurement.

a.2 General Operations Fund (GOF) - shall be utilized for grains operations
and underwhich the following fund control accounts are covered.

a.2.1 Grains Operating Expense (GOE) - for payment of personnel

services and maintenance and other operating expenses.

a.2.2 Capital Outlay Fund (COF) - for the

purchase/construction/rehabilitation/installation of equipment and
facilities.

b. Collection Accounts

Collections from various sources shall be deposited under the corresponding

savings account specified below:

SAVINGS ACCOUNT TYPE/SOURCE OF COLLECTION

b.1 Local Cereal sale of local rice

Collection (LCC)
 b.2 Imported Thailand sale of imported rice from Thailand
Rice (IT3)

b.3 National Productivity collections in connection with the

productivity Fund (NPF) program

b.4 Miscellaneous other collections including collections from

Collection (MSC) registration and licensing activities for
grains and non-grains

b.5 Service Income (SI) income derived by NFA from services

offered as a service corporation

b.6 Imported Yellow Corn sale of imported yellow corn

(IYC)

B. Books of Accounts

1. The drawing accounts (a) shall be recorded under Cash, Other Banks, Current while
the collection account (b) shall be recorded under Cash, Other Banks, Savings.

2. Subsidiary ledgers shall be maintained for each bank where NFA accounts are being
maintained. Sub-SL shall be maintained for each bank account and for drawing
accounts, fund control SL shall be maintained for each fund control account.

To illustrate:

General Ledger : Cash, Other Banks, Current

Subsidiary Ledger : PNB
Sub-Subsidiary Ledger : PNB-GOF
Fund Control Subsidiary Ledger : PNB-GOF-COF

3. The sub-columns affected in the books of original entry, i.e. CCRJ, shall state the
specific fund control SL account to facilitate posting in subsidiary ledgers and
reconciliation thereof.

C. Fund Monitoring

1. Collection Accounts

a. An official cash book for each collection account shall be maintained by the
Regular Collecting Officer.
b. The official cash book shall be updated daily to enable the collecting officer to
monitor fund balances at the end of each day.

c. Collections for the day shall be deposited intact not later than the following
working day.

Collections with Regular Collecting Officer (RCO) shall not be used to encash
TEV, personal checks and other check payments of any kind.

d. Collections deposited with PNB and LBP provincial branches shall be remitted to
the PNB-NFA branch and LBP Quezon Avenue Branch, respectively thru
telegraphic transfer/bankdraft/automatic remittance/transfer.

e. The RLO shall likewise check the remittances and collection accounts to ensure
that collections and deposits are remitted to C.O. every Thursday of the week or
as often as necessary whenever the balance is P500,000.00 or more. Should
the bank fail to comply with PNB-NFA Agreement and/or LBP Letter Offer with
NFA, for Automatic Remittance/Transfer once accumulated deposits exceed
P500,000.00, the Sr. Accounting Specialist should apply for telegraphic
transfer/bankdraft whenever the amount reaches P500,000.00 at any one time.
The telegraphic transfer/bankdraft application shall be signed by the Head of
Office. The bank however, is allowed to maintain a fund balance equivalent to
the minimum balance required.

Above provisions are in accordance with standing agreements with PNB and
LBP, copies attached (Annex A and Annex B).

f. For combo accounts maintained with the bank, the amount to be transferred
from savings to current account shall only be enough to cover check issuances.
At the end of the month or as deemed necessary, the Sr. Accounting Specialist
shall examine the bank statements and determine the amount transferred from
the savings account to the current account vis-a-vis the checks issued. If the
amount transferred from savings account to current account is greater than the
amount of checks issued, the Sr. Accounting Specialist shall make
representation with the bank management for the violation and accordingly
require them to credit to NFA accounts corresponding interest on the difference
between the supposed transfer as against the actual amount based on the
prevailing bank rate for savings account.

An agreement should be entered into between the NFA Provincial Management

and the bank management detailing therein the terms and conditions of the
combo account deposit.

g. The RCO shall request the bank to update the savings account passbook
regularly for remittances made by the bank. Upon updating, the RCO shall
 advise the Sr. Accounting Specialist (SAS) of the remittance made for recording
and preparation of Debit Advice.

2. Drawing Accounts

a. The Regular Disbursing Officer (RDO) shall maintain the Official Cash Book for
each drawing account. Same shall be updated daily to monitor fund balances.

b. All checks issued and bank debit memoranda shall be posted to the credit
column of the cash book, and remittances received shall be posted to the debit
column.

c. Remittances received by field offices from Central Office shall be checked

against the debit advice sent by DAB-COAD and wire from DTBFM. The
receiving field office shall confirm the remittance immediately upon receipt
thereof.

d. A cash book shall also be maintained by the disbursing officer to monitor

balances of imprest funds under his accountability.

Field Office shall remit idle funds to the Central Office and inform DTBFM-Cash Division
about the remittance. Policies on idle CPF per SOP No. FS-CS05 entitled SOP on
Cash with Procurement Disbursing Officer issued on May 13, 1988 and made effective
June 1, 1988 and Memo No. AO-E-017 dated May 18, 1995 shall be adapted to
ensure maximum utilization of the CPF.

D. Reporting of Remittances and Collections

1. Transaction for the week ending every Wednesday (Thursday to Wednesday

transactions) shall be summarized and reported to Central Office DTBFM Director
every Thursday thru wire (CASHMON). The wire shall contain the details of
remittances made and fund balances as of Wednesday of each week.

2. The cash books and bank passbooks for collection and drawing accounts shall be
reviewed by the Sr. Accounting Specialist (SAS) for use as bases for the report.

3. The following weekly reports from the Region/Province shall be consolidated by the
Fund Management Division (FMD) of DTBFM:

CASHMON (Exhibit 1.a) - This is a weekly report of fund balances to determine the
amount of funds floating in t he field office.

Summary of Receipts/Disbursements and Balances (SRDFB) - this serves as basis for

evaluating CPF remittances. The consolidated reports shall be submitted to the
Administrator's Office thru the Assistant Administrator for Corporate Administration.
 DMO shall likewise be furnished a copy of the SRDFB to serve as a basis in evaluating
CPF request from the field offices and in recommending remittance.

4. Unremitted deposits as reflected in the weekly report shall be noted. DTBFM - FMD
shall advise field offices for appropriate action. In case of non-remittance by the
provincial banks, the Sr. Accounting Specialist shall notify the bank in writing or apply
for fund remittance to NFA Central Office through telegraphic transfer.

5. DTBFM-Cash Division shall send Monthly Report of Remittances Received (MRRR) to

field office acknowledging receipt of fund remittances/credited to NFA Central Office
account. This shall be prepared and sent to the field office by the Cash Division not
later than the 15th day of the following month. The field offices concerned are obliged
to send back confirmation of the MRRR to Cash Division thru wire as per attached pro-
forma (Exhibit 3.a). The wire shall contain details with specific remarks such as figures
confirmed/account misclassified/incorrect amount reflected and other important details
concerning remittances. The wire should reach Cash Division within two (2) working
days from the date of receipt of the MRRR.

E. Reconciliation of Fund Transfers

1. Remittances by field offices as reported in the CASHMON shall be posted to the

Record of Fund Remittances to facilitate the reconciliation of remittances against bank
credits. Likewise such ledger shall provide an immediate reference for following-up
fund transfers not credited by the bank.

2. Recording of the wire to the Record of Fund Remittances shall be on a per transaction
basis and likewise the bank tickets (for bank credits) shall be recorded on a per ticket
basis. When recording, the wire reference number and the bank ticket number shall
be indicated to facilitate reconciliation.

3. In reconciling remittances reported by the field offices for the amounts credited by the
bank at the Central Office accounts, the transit time shall be determined. The transit
time which exclude Saturdays and Sundays shall serve as a gauge in determining the
efficiency of the bank.

4. The concerned field office/local bank and/or head office bank shall be immediately
notified of any discrepancy between what has been reported by the field office and
what has been credited by the bank to immediately effect necessary adjustments.

In case of unreasonable delay and/or non-remittance of funds, the concerned NFA

Provincial Manager shall request the local bank management to explain causes of
delays/non-remittance and demand for payment of corresponding interests/penalties
and service fees if there is any.

Failure to comply with the provisions of this SOP shall in accordance with P.D. 807 and RA
6713, subject concerned official and employee to administrative offense of violation of
Reasonable Office Rules and Regulations and shall, upon conviction, suffer the penalty of
Reprimand, Suspension or Dismissal, as the case may be.