BPA07 Public Accounting Budgeting

BPA07: Public Accounting
and Budgeting
LESSON 1:
GOVERNMENT
ACCOUNTING
TA B L E O F
 Objectives of Government Accounting
 Responsibility and Accountability of Government C
Fund
 Liability Over Government Funds and Property
O
 The Government Accounting Manual (GAM) N
 The National Accounting Agencies (NGA’s)
T
 Accounting Equation
 Basic Accounting and Budget Reporting Codes E
 Parties Interested in the Financial Operations of
Government
N
 Comparison of Government and Commercial T
Accounting
 The Accounting Cycle
S
 The Worksheet
Learning Objectives
After this lesson, the student should be able

to:
 Differentiate government accounting from
accounting for business entities;
 State the government entities charged with
accounting responsibility;
 Describe briefly the GAM and NGAS;
 State the basic principles used in
government accounting;
 State the recognition criteria for asset.
Accounting
The accounting process recording financial

transactions includes summarizing, analyzing,
and reporting these transactions to oversight
agencies, regulators, and tax collection entities.
Government Accounting
encompasses the process of analyzing,

recording, classifying, summarizing and
communicating all transactions involving the
receipt and disposition of government funds and
property, and interpreting the results thereof.
(State Audit Code of the Philippines, P.D. NO.
1445, Sec 109).
Analyze Classification
To determine or The grouping of
examine the composition of an transactions, entries, or
item, account, or amount, accounts under a common
usually by reference to its head or heads; a list of such
historical origin. groupings.
Record Summarizing/Communicating
An event or condition, the

recognition of which gives rise to an
To give expression to a entry in accounting records.
transaction on (or in) the books Exchange of goods or services and
of account; to enter. other events that have economic
impact on the entity.
*Objectives of Government
Accounting
(State Audit Code of the Philippines, P.D. NO. 1445, Sec 110)
a. To produce information concerning past operations and present

conditions;
b. To provide a basis for guidance for future operations;
c. To provide for control of the acts of public bodies and officers in the
receipt, disposition and utilization of funds and property; and
d. To report the facts concerning financial position and result of operations
of governmental agencies for the information of all persons concerned.
EMPHASIS OF GOVERNMENT ACCOUNTING
Sources of government
Sources and utilization of
government funds funds include receipts from
taxes, and other fees,
borrowings, and grants from
other government and
Responsibility, accountability international bodies and the
and liability of entities entrusted utilization of government
with government funds and funds includes expenditures
properties on programs, projects,
unanticipated losses from
calamities and etc.
*RESPONSIBILITY,
ACCOUNTABILITY and
LIABILITY OVER
GOVERNMENT FUNDS
AND PROPERTY
Responsibility over Government Funds and Property
o Government resources shall be utilized efficiently and effectively in

accordance with the law. The Head of Agency is directly responsible in
implementing the policy and responsible for government resources
entrusted to agency/institution.
o All those who are exercising authority over a government agency share
fiscal responsibility
CREDITS: This presentation template was created by Slidesgo, including
icons by Flaticon, and infographics & images by Freepik
Fiscal Responsibility
Is the most basic the act of creating, optimizing and maintaining a balanced
budget. People can do this independently, certainly, as can organizations of any size or
format; (single, partnership or corporation in most cases, though, this term is used in
the context of corporate spending and governmental finance
SINGLE- enterprise owned and run by one person and in which there is no legal
distinction between the owner and the business entity.
PARTNERSHIP –a formal arrangement by two or more parties to manage and operate
a business and share its profits.
CORPORATION-usually a presentation
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act as a single entity (a legal entity recognized by private and public law "born out of
statute"; a legal person in legal context) and recognized as such in law for certain
purposes.
Accountability over Government Funds and Property
o The government officer responsible entrusted with the possession of
government resources and responsible for the safekeeping in conformity
with the law. A government employee or an accountable officer in a
permanent post can apply for a bond at the Bureau of the Treasury.
(Philippine State Audit Code, P.D. NO. 1445 E.O. 292)
o Except as permitted by law, transfers of government funds monies from one

permanent officer to another must be approved by the Head of the
Agency and made
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adequate paperwork. The transfer shall be properly documented in an
invoice and receipt.
LIABILITY OVER
GOVERNMENT
FUNDS AND
PROPERTY
o Unauthorized use of government resources is the employee's personal responsibility
of employee found to be directly responsible therefor.
o All damages or losses caused by dishonesty in the protection of government funds
and property are the responsibility of the liable officer or employee.
o No accountable officer or government employee is exempt from liability for illegally
using government funds and property entrusted to him unless he is notified in writing
that the use of the funds is illegal because the person liable is the accountable
officer who fails to fulfill his responsibilities.
o The Commission on Audit is responsible for notifying the government of a loss of
government funds due to improper use of funds within 30 days. Failure to do so will
not excuse the office of its responsibilities.
W h a t ’s m o r e ?
Entity refers to a government agency, department of operating
unit. Each entity maintains accounting books and budget records. Each
entity reconciles to accounting books with cash records for Bureau of the
Treasury (BTr) and reconciles budget records with the Department of
Budget and Management (DBM). The entity’s accounting books are
subject to Audit by the Commission on Audit (COA) by submitting the
financial reports for consolidation for submission to the Congress and to
the President.
Government
Accounting
Manual (GAM)
for National
Accounting
Agencies (NGA’s)
Learning
Objectives
At the end of the lesson student aims to
understand GAM for NGAs
1. Identify the standard, policies, guidelines
and procedures in accounting for
government funds and property;
2. Understand the coding structure of
accounts; and
3. Familiarize accounting books, registries,
records, forms, reports and financial
statements.
*The Government Accounting Manual (GAM) for National
Accounting Agencies (NGA’s)
• It contains general provisions, basic standards and policies, the specific

guidelines and procedures for each standard and the illustrative entries for
typical transactions of national government agencies.
• Historically, there was existing government accounting system for five
decades. This was change to NGA’s or New Government Accounting System
in 2002 and lead to Government Accounting Manual (GAM) in January 2016.
• These reforms and changes happens in order to adapt and be responsive to
the dynamics of modern technology. Moreover, to have a consistent
government accounting system, creating international standards which was
the International Public Sector Accounting Standards (IPSAS).
• The IPSAS are based on International Financial Reporting Standards (IFRS) in
order to prevent disallowances of the uses of government funds through
irregular, unnecessary, extravagant and excessive expenditures.
Accounts maintained under NGAS
Cash Receipt Journal (CRJ), Cash Disbursement
Journal (CDJ), General Journal (GJ), General Ledgers
(GL), Subsidiary Ledger (SL)
Others are:
Cash, Receivables, Inventories, Investments,
Property, Plant and Equipment, Construction in Progress,
Liabilities, Income and Expenses
Cash Receipt Journal (CRJ) subsidiary ledger in which cash sales are recorded
Cash Disbursement Journal (CDJ) method of recording all cash flows/payment for a certain
business
General Journal (GJ) The first book in which transactions are recorded in chronological order
in a daily basis (i.e., the order of their occurrence)
General Ledgers (GL) accounting record that compiles every financial transaction of a firm
to provide accurate entries for financial statements (T-Account) This ledger account
aggregates the balances of all the related subsidiary ledger accounts.
Subsidiary Ledger (SL) is a list of individual accounts that record transactions with common
characteristics linked to a controlling account for it’s accounts that have related transactions
Cash legal tender or coins that can be used to exchange goods, debt or services. Cash is a current
asset
Accounts Receivable claims for payment held by a business for goods supplied or
services rendered that customers have ordered but not paid
Inventories referred to raw materials and finished goods that a business holds for the ultimate
resale, production or utilization
Investments asset or item acquired for generating income

Property Plant and Equipment long term fixed assets which is usually used for
the operation for more than a year like machinery, equipment, vehicles, buildings, land and office
furnishing
Construction in Progress asset or capital work in progress which not yet
completed
Liabilities debt or obligations that arise during the course of its business operations
Income money that an individual or business receives in exchange for providing a good or
service or through investing capital
Expenses is the cost of an asset used by a company in its operations to produce revenues
What is chart of accounts?
-it is a framework which the accounting records are constructed
- list of general ledger accounts consisting of the real and

nominal accounts. (consist of account’s name, a brief
description of the account, and an account number assigned to
aid in the recording and tracking transactions to achieved
uniformity in the recording of government financial transactions)
Types of T- Account – used as visual aid for seeing
the effect of the debit and credit on the two
accounts (or more) accounts
Asset Account Debit- left side of an account

Liability Account Credit – right side of an account
Equity Accounts
Account Name
Revenue or Income Accounts
__________________________
Expense Account Debit (Dr) | Credit (Cr)
|
Contra Account
|
Accounting
Equation
W h a t ’s n e w ?
Asset = Liabilities + Owner’s Equity
P1000 = P 600 + P400
Type of characters involves in the Accounting

a. Business = Ikaw
b. Asset = Pag-aari ng business
c. Liability = Utang ng business sa iba
d. Owner’s Equity = Utang ng business sa may ari
(owner)
Question: Is the business and owner the same?
Answer: No, with the use of Accounting Equation, we will understand that
the business and owner is not the same.
A = L + OE
Explanation:
Business = Buy and Sell
Question: When the money came from?
a. Loan to other person or bank (Ex. P600)
b. Loan to the owner (Ex. P400)
P600 + P400 = P1,1000 ( That is total money of the business)
L + OE = A
In this form, the business and the owner is the same, but in
substance, business needs to loan at own.
Example 1 (Asset)
Buy a laptop and paid for P 30,000.
Entry: Equipment P 30,000

Cash P 30,000
Therefore: Debit is equipment because you owned the

laptop.
Debit (Kapag nagkaroon ng “asset o bagay”).
Credit is cash because you paid for the laptop.
Credit (Kapag nabawasan ng “asset o pera”).
Example 2 (Liability)
Buy a laptop but in the form of loan for P 30,000.
Entry: Equipment P 30,000

Accounts Payable P 30,000
Therefore: Debit is Equipment because you paid the laptop using

loan.
Debit (Kapag nawalan ng utang).
Credit is Accounts Payable because you use loan to buy.
Credit (Kapag nagkaroon ng utang).
Example 3
Paid loan for P 30,000.
Entry: Accounts Payable P 30,000

Cash P 30,000
Therefore: Debit is Accounts Payable because you paid what you

owe.
Debit (Nawalan ng utang).
Credit is Cash because you paid money.
Credit (Nawalan ng pera pambayad).
Example 4
Use the equipment for business in accounting tutorial but for collection P
20,000.
Entry: Accounts Receivable P 20,000

Service Income P 20,000
Therefore: Debit is Accounts Receivable because you collected cash for

loan.
Debit (Nagkaroon ng pa-utang).
Credit is Service Income because you earn income.
Credit (Nagkaroon ng kita).
Example 5
Collect the payment for service rendered P 20,000.
Entry: Cash P 20,000

Accounts Receivable P 20,000
Therefore: Debit is Cash because you collected cash for the service
rendered.
Debit (Nagkaroon ng pera).
Credit is Accounts Receivable because you collected cash for
service rendered.
Credit (Nawalan ng pa-utang).
Example 6
Paid rental for the tutorial amounting to P 10,000.
Entry: Rent Expense P 10,000

Cash P 10,000
Therefore: Debit is Rent Expense because you paid for rental

use.
Debit (Nagkaroon ng gastusin).
Credit is Cash because you paid money.
Credit (Nawalan ng pera).
Therefore, in business point of view,
Decrease in Asset Increase in Asset

- payment of loan - gain asset for the business that
- decrease asset due to payment of came from the loan due to
loan investment of creditor
- decrease asset due to payment of - gain asset for the business that
loan came from the initial capital or
- withdrawal of capital of the owner investment of the owner
expenses
Equity/Capital = Investment + Revenue – Expense – Drawing
• Increase in Equity
- equity increases if the revenue is more than the expense
(Net income).
- equity increases if there is an additional cash for the business.
• Decrease in Equity
- equity decreases if the expense is more than the revenue (Net Loss).
- equity decreases if the cash return to the owner for withdrawal.

DEBIT (DEAL) CREDIT (GIRLS)
D-ividends G-ains
E-xpenses I-ncome
A-sset R-evenue
L-osses L-iabilities
S-tockholder’s Equity
Basic
accounting
and reporting
codes
The financial records and reports of government entities shall
comply with the following:
01 02
Comply with the rules and Use accrual basis when
regulations of Philippine recognized transactions for
Public Sector Accounting the period when cash is
Standards (PPSAS); received or paid;
03 04
Follow the budget basis in Use COA prescribed
presentation of information Revised Chart of Accounts;
in the financial statements;
05
Double entry of
bookkeeping;
06 07
Create financial statement
from the accounting and Use fund cluster accounting
budgetary records;
The Dual Role of the Accounting System
a. Government accounting plays a vital role in the government

financial system.
• The information provided by the financial statements are bases for making decisions.
A government accounting system basically serves two purposes: accountability and
management requirements.
b. Accountability
• In government, money is made available and expended to serve the public good. In
here, accounting and financial management systems are established as key points of
control. Accountability requirements are satisfied in part by internal controls dealing
with the handling of financial transactions. Such controls are set up to ensure that all
financial transactions are handled in compliance with applicable laws and regulations,
and that all assets, funds and resources are safeguarded against waste, loss or
improper use.
c. Management requirements
• Government accounting is an integral element of the public finance system. It is
relevant to management for decision-making in the areas of planning, budgeting and
a basis for internal control. The accounting system provides data useful for
administrative control of program operations and for the evaluation of planned
performance and accomplishment of program objectives. Government accounting is
seen mainly as an accountability device for public receipts and expenditures.
Performance measurement and managerial functions seem, however, to be
neglected.
Parties
interested in
the Financial
Operations of
Government
Parties Interested in the Financial Operations of
Government
1. General public.
This constitutes the citizen-stockholders of the government corporation.
A basic principle of popular government is that all public officials shall be held to
a rigid accountability for the manner in which they perform their duties.
2. Legislature.
The grant of funds with which to do such work and the raising of funds
for the meeting of the expenditures.
Parties Interested in the Financial Operations of
Government
3. Government officials.
The duty of government officials is not to direct actual operations but to
exercise supervision and control over those who have the duty to ensure that they
are performing their duties in compliance with law and in a satisfactory manner.
4. Donors and lending institutions.
These are the parties providing government with loans and donations.
They are either other governments that can be national and international entities.
Comparison of
Government
and
Commercial
Accounting
Similarities:
Commercial and government accounting are similar in many ways, based on the
following aspects:
1. Both are concerned with controlling and reporting on financial position, results of
operations and changes in financial position.
2. Both emphasize relevance, reliability, comparability, consistency, materiality,
understandability,
historical cost information, and completed transactions.
3. Both are concerned with safeguarding assets, assigning stewardship responsibility for
individual resources, and providing information for internal and external decision making.
Similarities:
4. Both apply the following accounting principles:
- double-entry, that for every entry made to the debit side of the account/s, an entry or
entries for a corresponding amount will be made to the credit side of an account/s.
- accrual basis of accounting under which transactions are recognized when they occur,
regardless of the timing of related cash flows.
- mechanics of accounting procedures where transactions are recorded from data
contained in the accounting documents. The information is first placed in the books of
original entry (journal) from which it is posted in the general ledger and subsidiary ledgers.
-proper classification of account to facilitate the preparation of the financial statements and
the conduct of audit.
Differences:
Although there are many similarities between commercial and governmental
accounting, there are also certain basic differences which stem from the
following factors:
a. Purpose – lack of profit motive in government. Government exists to render service to the
public at the lowest possible cost while a private business enterprise exists to
maximize economic profit. These profits are retained for public use aside from
rendering public service.
b. Ownership – government obtains most of financing from involuntary taxpayer resource
providers, and every citizen may be said to have a “share” in government
assets but no individual can dispose of his “shares” and realize a return from
it.
Differences:
c. Management – the necessity of complying with legal provisions. Government transactions
are governed by specific laws, rules and regulations which result in
limitations imposed under which revenue may be earned, debts are
incurred and expenditures made. An accounting system of a government
unit is designed to show not only financial position and operations but also
the extent of compliance with legal provisions.
d. Income – The government derives its income mostly from taxes and fees that the estimated
amount of which is made as the basis of allotting the national budget to different
agencies. Limitations on the ways by which the government may secure and use
its income require the use of fund accounting so that money is spent for the
specific purpose for which it was granted.
Comparison of
Government
and
Commercial
Accounting
Issue Government Commercial
Sources of constitution, laws, rules and regulations nature of business and management
Accounting policies
Practice and
Procedures
Accounting Entity A fund with a self-balancing set of accounts The business enterprise is an accounting
for financial control purposes is considered an entity, regardless of the number of funds
accounting entity maintained
Fund Accounting: The accounting of money No Fund Accounting: The accounting of
collected and appropriated is separate and money collected is not separate and
independent from each other; separate books independent.
of accounts are maintained.
Control Obligation Accounting provides the ceiling No Obligation Accounting

Mechanisms and control over the commitment of
government resources.
Cash Disbursement Ceiling provides the ceiling No Cash Disbursement Ceiling
and control to cash utilization of the Accounting
government.
Accounting Basis or Mixed (Accrual and Cash): Taxes are Either Cash or Accrual but not a mixture
Method accounted for on cash basis. The accrual of both
basis is used for other revenues and expenses.
Books of Accounts The general fund operations of the Ordinarily only one set is kept,
Government are recorded and except where there are branch
controlled in three sets of books: offices.
(a) agency books; (b) BTr books;
and (c) COA books.
Budgetary and real (actual) Nominal and real accounts are

accounts are used. Estimates are used. Estimates, if ever recorded,
recorded and accounted for. are considered as memorandum
entries.
Accounts and Transactions Fixed assets are depreciated. Depreciation is considered an
Depreciation is accounted for as a overhead expense.
reduction to the investment surplus
account.
Form and Substance Due to the legal implications of The economic substance of
rules and regulations, the legal transactions is emphasized over
form supersedes the economic the legal form. Hence, procedures
substance. Procedures are fixed are more flexible.
and must follow the prescribed
system and use of the prescribed
form
Materiality In as much as government accounting is based In as much as government
on budgetary control system which is accounting is based on budgetary
implemented through a host of government laws control system which is
and regulations, the emphasis is on compliance implemented through a host of
and accuracy. Hence, Materiality no matter how government laws and regulations,
immaterial in amount, any infraction of applicable the emphasis is on compliance
laws and regulations constitutes a violation. The and accuracy. Hence, Materiality
emphasis on accuracy instead of fairness is no matter how immaterial in
evident in accounting reports which are “certified amount, any infraction of
correct” by accountants. applicable laws and regulations
constitutes a violation. The
emphasis on accuracy instead of
fairness is evident in accounting
reports which are “certified
correct” by accountants.
The financial accounting concept of materiality
applies to the government auditor’s expression of
an audit opinion but not to the formulation of
recommendations on audit findings pertaining to
violations of applicable laws and regulations.
The
accounting
cycle
The primary objectives To meet these primary
of the accounting function are to objectives, a series of steps or
process financial information and sequence of activities is required
to prepare financial statements from the analysis of transactions
at the end of the accounting through closing the books, known
period. collectively as the accounting
cycle.
Steps of the accounting cycle
Analyze transactions and business documents.

 An event or condition that has an economic impact or
effect on the entity’s financial condition. A business
deal or agreement. Business documents. Records that
are evidence of transactions.
 The transaction is identified through a source
document such as receipt/disbursement voucher
which provides the date, amount, description and
name/address of the party if necessary. The
transaction is analyzed, determining which accounts
are affected, how (increase or decrease), and how
much.
Journalize transactions
• It is an accounting record in which business transactions
are entered in a chronological order. The journal is
commonly referred to as the book of original entry.
• Each entry in the journal is called a journal entry and
represents a different business transaction. Each
transaction is recorded only once as a debit and a credit.
Every journal entry involves a three-step process:
· Identify the accounts involved with an event or
transaction.
· Determine whether each account increased or
decreased.
· Determine the amount by which each account was
affected
Post journal entries to ledger accounts.

-process of transferring amounts from the journal to the
general ledger.
Ledger - a collection of accounts in which data from
transactions recorded in the journals are posted, classified
and summarized
Determine account balances and prepare a trial balance.

A trial balance is a report that lists the
balances of all general ledger accounts of a accompany
at a certain point of time. It is primarily used to identify the
balance of debits and credits and provide as a means to
assure that the books are “in balance” and that total
debits and total credits are equal. The trial balance uses
the information from the general ledger to summarize the
data to be used in preparing the Financial Statements.
Journalize and post adjusting entries.

Adjusting entries are required at the end of each
accounting period for accrual basis of accounting in
order to record any unrecognized income or expenses for
the period. It happens prior to the preparation of the
financial statements. When a transaction is started in one
accounting period and ended in a later period, an
adjusting journal entry is required to properly account for
the transaction.
Moreover, adjusting journal entries can also refer to
financial reporting that corrects a mistake made
previously in the accounting period.
The purposes for adjusting entries are to:
a. brings balance sheet accounts to be current

b. reflects proper amounts of revenues, costs, and expenses in the income statement.
Under the matching principle, adjustments should be made for economic activities
that have taken place but are not yet recorded at the time when the financial
statements are prepared. In other words, adjusting journal entries are used to record
transactions that have occurred but have not yet been appropriately recorded in
accordance with the accrual method of accounting.
Items that should be adjusted are:
· Earned revenues not yet recorded as assets and income at the end of the
accounting period.
Examples: receivables for revenues already earned but not yet collected nor billed as
of the year end.
· Assets, portion of which shall be recorded as expense of the agency at the end of the
accounting period. Examples: prepaid expenses, bad debts and depreciation.
The
worksheet
worksheet
A worksheet is prepared before

the construction of financial statements
and before the adjusting entries are
entered in the journal and posted. Also
used to summarize all the information
necessary to complete the end-of-period
financial reports and prepare other
financial analyses.
Steps on preparing a
Worksheet
a.) Prepare an adjusted trial balance.
After the accounts have been adjusted
and posted, an adjusted trial balance is prepared
to prove the accuracy of the postings to the
general ledger.
b.) Prepare financial statements.

Financial statements are prepared after
the trial balance has been adjusted. The financial
statements required under NGAS are balance
sheet, statement of income and expenses,
statement of government equity (not required for
local government units), and statement of cash
flows.
Four Main Financial
Statements
1. Balance Sheet
The financial statement 3. Statement of Government Equity
which shows the amount and nature The financial report that
of assets, liabilities, and government summarizes all the changes in owner's
equity as of a specific period. It is also equity (capital) that occurred during a
known as a Statement of Financial specific period.
Position or a Statement of Financial
Condition.
4. Statement of Cash Flows
2. Statement of Income and Expenses The financial statement that
reports the sources and uses of cash
The financial statement that for a specific period, normally a year.
summarizes revenues and expenses for
a specific period, usually a month or a
year. This statement is also called a
Profit and Loss Statement or an
Operating Statement.
Steps on preparing a
Worksheet
c.) Journalize and post-closing entries
After the Statement of Income and
Expenses has been prepared, the nominal or
temporary and intermediate accounts are closed
at the end of the accounting period.
d.) Prepare post-closing trial balance
The post-closing trial balance is prepared
after recording the closing journal entries in the
general journal and posting to the general ledger. It
contains a listing of all general ledger accounts that
remain open after the closing process is completed
O rga n i zat i o n a l Ro l e s a n d Re s p o n s i b i l i t i e s
The following organizations play central roles in accounting and auditing
arrangements in the governance scheme.
Commission on Audit (COA)

examines and audits the general accounts of the Government, promulgates
accounting rules and regulations, and presents the annual financial report of the
Government, its subdivisions, and agencies (including government owned or controlled
corporations).
Department of Finance (DOF)

is responsible for the government’s fiscal policies in coordination with other
concerned public subdivisions, agencies, and instrumentalities; managing the financial
resources of government; supervising the revenue operations of privatizing and
ensuring the public accountability of corporations and assets owned, controlled or
acquired by the Government (under Executive Orders 127, 127-A and 292). The DOF
supervises three operating bureaus: Bureau of the Treasury (BTr), the Bureau of Internal
Revenue (BIR), and the Bureau of Customs (BOC).
O rga n i zat i o n a l Ro l e s a n d Re s p o n s i b i l i t i e s
Bureau of the Treasury (BTr)

takes charge of the cash operations of the national government and is
responsible for receiving and keeping national funds; managing and controlling
disbursements of national funds; and maintaining accounts of financial transactions of
all national government offices, agencies, and instruments.
Department of Budget and Management (DBM)

responsible for the design, preparation and approval of the accounting
systems of government agencies. It is also responsible for coordinating and
implementing the annual budget process and manages the process of cash
disbursement. It monitors compliance with appropriations.
Prepared by:
BPA-3B
Acquiatan, Karen S. Cadavillo, Francis Arjay
Amon, John Ryan T. Chavez, Jonalyn C.
Aranilla, Gerald P. Cosico, Julie Ann A.
Barnuevo, Mhico F. Cuevas, Maria Isabelle
Victoria T.
Benelada, Ashley Joy A.
De Rosales, Angelica B.
and Budgeting
Lesson 2:
PROJECT, ACTIVITIES
AND PROGRAM
PROJECT, ACTIVITIES AND PROGRAM
• The objective of projects, activities, and programs describes the various stages of the
planning process in the framework of Results Based Management. The document includes
directions on how to integrate and execute this method in real-world settings. It explains
the major components of RBM as well as references to the agency's concerns.
• Philippine government aims to improve the lives of vulnerable people by harnessing the
power of humanity affected by dangers, disasters, or other barriers to their well-being.
There is frequently an unequal power balance between humanitarian groups and the
people they aim to serve, as well as a lack of regulation in humanitarian practice. Results-
based approaches to job management can enable them to fulfill this duty effectively and
fairly.
• Results - Based Management (RBM) – refers to overall approach in managing projects,

activities and programs that focuses on defining measurable results and the methodologies
and tools to achieve it.
- It supports better performance and greater accountability by applying a clear logic: plan,
manage and measure an intervention with a focus on the results you want to achieve.
• Results – intended or unintended effects of an intervention. They can be positive or
negative depending on multiple factors. Intended positive results are used as the basis of
planning, while an effort is made to anticipate any potential negative results so that they
can be avoided or minimized.
• Objectives – intended results of an intervention
• Results and objectives can be classified according to their level of importance, with the
lower-level objectives defining the changes that need to occur in order for the higher-
level objectives to be achieved. By setting out in advance the intended results of an
intervention and ways in which to measure whether they are achieved or not, it can be
seen more clearly whether a difference has genuinely been made for the people
concerned.
• The projects, activities and programs can be used to implement a results-based approach
that help and define the design and management of an intervention. The phases are
broadly progressive, with each one leading to the next and also interrelated and may at
times overlap. The duration of activities is important in relation to each phase will vary
depending on the context.
• Initial assessment – may be needed to obtain supplementary information during the
planning phase. This phase is a process to understand the current situation and find out
whether or not an intervention is required. This is done by identifying the key factors
influencing the situation including problems and their causes, as well as the needs,
interests, capacities and constraints of the different stakeholders.
When an intervention is required, an assessment can include an initial analysis and

proposal of the type of intervention that could be carried out. It is a process to define an
intervention’s intended results (objectives), the inputs and activities needed to accomplish
them, the indicators to measure their achievement, and the key assumptions that can affect
the achievement of the objectives.
• Planning – takes into consideration the needs, interests, resources, mandates and capacities of
the implementing organization and various stakeholders. At the end of planning phase, a
project plan is ready to be implemented.
• During implementation of projects, activities and programs are carried out to achieve the
intended results (objectives) to each particular area of intervention with detailed guidance on
implementation can therefore be found in manuals.
Implementation and Monitoring
During implementation of projects, activities and programs

are carried out to achieve the intended results (objectives) to each
particular area of intervention with detailed guidance on
implementation can therefore be found in manuals.
What is monitoring?
“Monitoring” is defined the routine

collection and analysis of information in order
to track progress, check compliance and make
informed decisions for projects activities and
programs.
Monitoring systems should be

established during the planning phase to allow
collection of information on the progress made
in achieving the objectives during
implementation.
Implementation and Monitoring
Evaluation is defined as an assessment of a systematic ongoing or

completed projects, activities and programs or policy, its design,
implementation, and results aim is to determine the relevance and fulfilment of
objectives developmental efficiency, effectiveness, impact, and sustainability.
An evaluation should provide information that is credible and useful
process in identifying the purposes of evaluation at various stages of the
project, activities, and programs.
Intervention
Intervention implies that an administration is compelled to determine exchange
disputes between market players, sharing the financial dangers straightforwardly or in a
roundabout way and giving up the job of the referee. The advantage of government
intervention is the chance of decreasing expected political risk, and the expense is that
such an administration needs to prepare public or private assets to share the
corresponding economic risks.
Importance of tools and techniques in intervention includes:
• Involvement of the people that intervention seeks to help and address
• Relevant participation of all those involved in different aspects of the planning
• Involvement of those who will implement the intervention
• Decision-makers in governance
• Decision-makers in management
• Stakeholders of organization involved
Intervention
In developing an intervention, it is vital to have a scope of the:

• Outline of the analytical tools and techniques that will be use
• Analysis of stakeholders
• Problems and causes
• Objectives
• Alternative options for intervention
The results of the intervention may vary from time to time depends on the variables and
factors at stake, but it is very important to understand the fundamentals of intervention that
can be a key in addressing the problems that the administration will face.
PROJECT PROFILE
OFFICE _________________ SECTORAL_________
I - PROJECT DESCRIPTION
Project Title
Project Type
Capital Investment
Technical Assistance
Relending
Government Buildings
Project Components
Project Location
Provinces
Municipalities
II - PROJECT STATUS IV - PROJECT FINANCING
On-going Funding Requirements
Proposed Funding Source
Status of Project Preparation Funding Counterpart
Pre-Feasibility Study Financial Viability
Feasibility Study
Detailed of the Project V - PROJECT BENEFIT AND COSTS
Detailed of Fund Beneficiaries
Social and Economic Benefits and Benefits
III - PROJECT JUSTIFICATION
Background VI - PROJECT IMPLEMENTATION
Goal Agencies Involve
Purpose Implementation Schedule
Activities Environmental Clearance
Linkages Social Acceptability
VII – PROJECT LOGICAL FRAMEWORK
VIII - PROJECT DOCUMENTATION AND LOCATION

MAP
Planning
Planning consists of determining solutions

to an unsatisfactory situation by identifying the results
that will best address identified problems and needs,
and the actions and resources required to achieve
those results. It is the foundation of good
performance management and accountability.
Planning can also be seen as a process of
choosing from the different courses of action
available and of prioritizing the steps to take in order
to change a particular situation for the better.
Strategic Planning
Strategic planning is the process of deciding where an organization wants to get

to and why, then choosing from the different courses of action available to ensure the best
chance of getting there. It helps an organization to define a clear way forward in response
to emerging opportunities and challenges, while maintaining coherence and long-term
sustainability. It guides the overall direction of an organization by defining its vision and
mission and the goals or strategic objectives necessary to achieve them.
Strategic planning also includes choosing and designing a framework which sets
out the best courses of action to achieve the stated objectives.
Operational Planning
Operational planning is the process of determining how the objectives spelt out in
the strategic plan will be achieved “on the ground”. It usually covers the short term
(between several months and three years).
A plan is the highest level of operational planning (e.g., for a geographical area
or for a technical area) which several groups’ programs (and their respective projects,
activities, etc.) with a view to achieve part of an organization’s strategic objectives.
A program is a set of coordinated projects implemented to meet specific
objectives within defined time, cost and performance parameters. Programs aimed at
achieving a common goal under a common entity (country plan, operation, alliance, etc.).
An activity is a combination of several tasks, all of which target the same
objective. This is the lowest level of actions that need to be planned. Tasks are the simplest
actions that make up activities.
Planning Phase
It is an intervention’s intended results (objectives), the inputs and activities
needed to accomplish them, the indicators to measure their achievement, and the key
assumptions that can affect the achievement of the results (objectives).
Planning takes into

consideration the needs, interests,
resources, mandates and capacities of the
implementing organization and various
stakeholders.
Stages in Planning Phase
1. ANALYSIS STAGE
• Identifying the main strengths, interests, needs, constraints and opportunities of the
implementing team and of key stakeholders.
• Identifying the problems that need to be solved and their causes and consequences.
• Development of objectives involves on the identified problems and verifying the cause-
effect relationships in order to achieve the main objective.
Analysis stage aims to understand in more detail the information gathered during
the assessment phase. The conclusions and recommendations of the assessment should be
used as the basis for a more detailed analysis of the problems to be tackled.
If the information collected appears to be inaccurate, incomplete or biased, it

may be necessary to redo some of the assessment steps, using the relevant methodology
and tools.
Tools to analyze the situation in which a team intends to
intervene:
1. Stakeholder analysis 2. SWOT analysis
• to assess the problems, interests and • Identifying core strengths,

potential of different groups in weaknesses, opportunities, and
relation to the conclusions of the threats leads to fact-based analysis,
assessment. fresh perspectives, and new ideas.
• to ensure that the intervention takes
place in the best possible conditions,
by aligning it realistically with the
needs and capacities of the
stakeholders.
Tools to analyze the situation in which a team intends to
intervene:
3. Problem tree analysis 4. Sustainability analysis
• to get an idea of the main • It is an intervention that must be

problems and their causes, focusing checked for sustainability before their
on cause-effect relationships. implementation.
• An intervention may be said to be
sustainable when it can deliver
benefits to the selected target group
for an extended period of time after
the main assistance from donors has
ended.
The following factors should be taken into account when planning/designing and
implementing projects, activities and programs:
01 1. Policy support measures
2. Socio-cultural aspects
3. Gender issues
4. Institutional and management capacity
5. Environmental issues
6. Appropriate technology
7. Economic and financial issues
8. Risk management
9. Exit strategies
Stages in Planning Phase
2. DESIGN STAGE
• Design stage involves refining the intervention’s objectives, identifying the assumptions,
indicators and means of measuring them, and developing a summary of activities.
• This involves determining the sequence of activities, estimating their duration, setting
milestones and assigning responsibilities.
Republic Act 9184 Project
Procurement and Contract
Management
Bidding Procedures for the Procurement of “Goods”
Salient Features Public Bidding
1. Procurement of all government agencies

2. Approved Budget for the Contract (ABC)
3. Use of transparent, objective and non-discretionary criteria
4. Increase Transparency in the procurement process
5. Inclusion of Penal and Civil Liabilities
https://www.youtube.com/watch?v=KReZG-5nKA8
Governing Principles:
• Public Monitoring
• Accountability
• Competitiveness
• Transparency
• Streamlined Process
PROCUREMENT - refers to the acquisition of goods, consulting services, and the
contracting for infrastructure projects by procuring entity.
(Sec. 5(aa), IRR, R.A. 9184)
GOODS AND SERVICES - refer to all items, supplies, materials and general
support services, except consulting services and
infrastructure projects, which may be needed in the
transaction of public businesses or in the pursuit of any
government undertaking, project or activity. (Sec. 5(r),
IRR, R.A. 9184
Standardized Bidding Procedures
01
• Pre- Procurement Conference
• Advertisement
• Pre-Bid Conference
• Submission of Bids
• Opening of 1st Envelope – Eligibility Docs & Technical
Proposal
• Opening of 2nd Envelope – Financial Proposal
• Bid Evaluation & Ranking
• Post Qualification
• Contract Award
Preparation of Bidding Documents
• Prepare the Bidding Documents by following the standard forms prescribed by

the Government Procurement Policy Board (GPPB);
• Specifications and other terms in the Bidding Documents shall reflect the
minimum requirements or specifications required to meet the needs of the
procuring entity;
• Use clear and unambiguous terms in your specifications;
• Reference to brand names not allowed
• Bidders will be asked to pay for the Bidding Documents to recover the cost of its
preparation and development;
• BAC shall issue the bidding document upon payment of the standard rate
Preparation of Bidding Documents
• Bidding Document must be available on the same date the advertisement
and/or posting of the Invitation to Bid is made;
• Bidding Document shall be posted at the PhilGEPS website and the Procuring
Entity’s website wherein prospective bidders may download, provided that,
bidders shall pay the fee for the Bidding Documents on or before submission of
their bids;
• The Bidding Document shall include the following:
a). Approved Budget for the Contract;
b). Invitation to Bid;
c). Minimum eligibility requirements;
d). Instruction to Bidders;
e). Technical Specifications
Invitation to Bid
Pre-Procurement Conference
• Purpose: Determine readiness to proceed with the bidding process

• Conducted before advertisement/posting of the Invitation to Bid
• Mandatory for the procurement of Goods with ABC above Php 2M;
Attended by the following:
a. BAC
b. BAC Secretariat
c. TWG
d. Consultants
e. End-user unit/Other officials
Contents of the Invitation to Bid
I. Name of contract to be bid and brief description of the goods to be procured;
II. A general statement on the criteria to be used for eligibility check, evaluation of bids, and
post-qualification;
III. The date, time and place of the deadline for submission and receipt of the eligibility
requirements and bids; pre-bid conference, if any, and the opening of bids;
IV. The ABC;
V. The funding source;
VI. Period of availability of bidding documents, place where they may be secured, the website
where bidding documents may be downloaded, and price where applicable;
VII. Contract duration or delivery schedule;
VIII. The name, address, telephone number, fax number, e-mail, and website address of the
procuring entity and designated contact person;
IX. The Reservation Clause; and
X. Other necessary information deemed relevant by the procuring entity.

Advertising and Posting of Invitation to Bid
Public Private Partnership (PPP) projects must be advertised in at least one
newspaper that has been published for at least two (2) years before advertisement
date; posted continuously for 7 calendar days; required for projects with ABC of 10M
and below for the procurement of Goods and 15M or below for Infrastructure projects.
Penalty for Posting

Failure to post the Invitation to Bid in the PhilGEPS bulletin board will hold
accountable officials for dereliction of duty and conduct grossly prejudicial to the best
interest of the service. Failure to post all procurement opportunities and awards will
lead to other charges, whether administrative, civil or criminal.
Pre-Bid Conference
The PBC is mandatory for projects with ABC of 1M or more and must be
held at least 12cd before bid submission.
Supplemental Bid Bulletin
• Statements made in pre-bid shall not modify the terms of bidding documents unless
issued as a supplemental/bid bulletin;
• Issued to answer written requests for clarification or interpretation submitted by

prospective bidders at least 10 c.d. before deadline for bids; or
• Issued also upon BAC’s initiative to clarify or modify any provision of Bidding Docs.
• Issued by BAC at least 7 c.d. before deadline for submission of bids; posted in PhilGEPS
and agency’s website, if any;
• Bidders who have submitted bids before issuance of Supplemental/Bid Bulletin to be

informed in writing and allowed to modify or withdraw their respective bids.
Supplemental Bid Bulletin
• RA 9184 IRR allows PEs to issue Supplemental/Bid Bulletins upon their initiative for the
purpose of clarifying or modifying any provision in the Bidding Documents, including the
IB.
• PE cannot compel prospective bidders to submit or comply with requirements not

initially provided in the Bidding issued by the PE (project must be posted at the
PhilGEPS’ and the PE’s website).
Modification and Withdrawal of Bids
• A bidder may modify its bid, provided it is done before the deadline for the submission
and receipt of bids;
• A bidder modifying his bid will only be allowed to send another bid equally sealed,
properly identified, linked to the original and marked as a “modification”;
• Bid modifications received after the deadline shall not be considered and shall be
returned to the bidder unopened;
• A bidder may withdraw his bid before the deadline for the receipt of bids;
• The bidder who withdraws its bid shall not be permitted to submit another bid, directly or
indirectly, for the same contract.
Submission and Receipts of Bid
Receipt and Opening of Bids
• BAC opens bid envelopes in public to determine each bidder’s compliance with the
documents required to be submitted;
• BAC shall check the submitted documents of each bidder against a checklist of
required documents using a non-discretionary “pass/fail” criteria
• If a bidder submits the required documents, it shall be rated “passed” for that particular
requirement.
• Bids that fail to include any of the requirement or are incomplete or patently insufficient
shall be considered as “failed”.
Prepared by:
Del Rio, Princess Bianca G.

Desembrana, Lalaine L.
Edora, Noireen R.
Gervas, Leann O.
Ilagan, Jhade Leovelle A.
Labitigan Jr., Mario A.
Laqueo, Rechelle O.
Lladoc, Patricia M.
Luna, Leana D.
Macalinao, Kaye Dimple
BPA-3B
and Budgeting
LESSON 3:
THE BUDGET
PROCESS
Learning Objectives
 At the end of the lesson, the students should be able to:
 To provide structure in the agency budgeting that offers useful guidance in

designing an agency’s programs, activities, and projects.
 To provide allocation for efficient utilization of the agency’s resources in
implementing plans, programs, and activities.
 To measure agency performance which serves as a practical basis for evaluating
an agency’s performance.
INTRODUCTION
*The National Budget
T h e N at i o n a l B u d get
The National Budget is crafted with the primary objective of bringing about
a positive transformation through the implementation of successful change and
development towards the achievement of providing for the life of people based on
credible and disciplined policies guarantees for long-term fiscal sustainability. The key
to sustaining the country’s growth is to ensure that our limited resources from
improved revenue collections and sustainable borrowings are the country’s strategic
priorities of the government.
T h e N at i o n a l B u d get
 Government budgeting is the allocation of public funds to attain the economic

and social goals of the country. It also entails the management of government
expenditures to create the most impact from the production and delivery of
goods and services.
 Government budgeting is important because it enables the government to plan
and manage its financial resources to support the implementation of various
programs and projects that best promote the development of the country.
Through the budget, the government can prioritize and put into action its plans,
programs, and policies within the constraints of its financial capability.
W h at i s i t ?
Budget
• Is the government’s plan for a year. It is a table of/ schedule of expenditures, based
on either obligation or cash concepts and the corresponding sources of financing,
either from revenues, borrowings, or cash drawdown. Eventually, it is a toll that
enables the government to achieve its development agenda.
• Budgeting for the national government involves four (4) distinct phases: budget
preparation, budget legislation or authorization, budget execution or
implementation and budget accountability.
*BUDGET
CYCLE
*Budget Cycle
There are four phases in managing the national Budget.
 Budget Preparation
 Budget Legislation
 Budget Execution
 Budget Accountability
During the preparation phase, the Executive prepares the proposed National Budget. This
is followed by the legislation phase where the Congress authorizes the General
Appropriations Act. In the execution phase, agencies utilize their approved budgets and
during the accountability phase, the executive monitors and evaluates the use of the
budget.
I
*BUDGET
PREPARATION
BUDGET PREPARATION
This starts with the Budget Call and ends with the President's submission of the
proposed budget to Congress.
 What is the Budget Call?

 What is Early Preparation?
 What is Stakeholder Engagement?
 What is "Bottom-Up" Budgeting?
 What are Technical Budget Hearings?
 What is the Executive Review?
 What is Consolidation, Validation, and Confirmation?
 What is a Presentation to President and Cabinet?
 What is the President's Budget?
1. The Budget Call
• At the beginning of the budget preparation year, the Department of
Budget and Management (DBM) issues the National Budget Call to all
agencies (including state universities and colleges) and a separate
Corporate Budget Call to all GOCCS and GFls.
• The Budget Call contains budget parameters (including macroeconomic
and fiscal targets and agency budget ceilings) as set beforehand by the
Development Budget Coordination Committee (DBCC): and policy
guidelines and procedures in the preparation and submission of agency
budget proposals.
Early Preparation
• Under the Aquino Administration, the DBM has
established a new tradition of beginning the Budget
Preparation phase earlier, to ensure that the
National Budget is enacted on time. Under the new
Budget Preparation Calendar, the Budget Call is
issued in December (versus around April in the past);
and the submission of the President's budget a day
after the State of the Nation Address (in contrast to
earlier practice where it is submitted during the late
in the 30-day window that the Constitution
prescribes).
2. Stakeholder Engagement
A new feature in budget preparations which
seeks to increase citizen participation in the budget
process, departments and agencies are tasked to
partner with civil society organizations (CSOS) and
other citizen stakeholders as they prepare their
agency budget proposals.
This new process, which was piloted in the
preparation of the 2012 National Budget, is now
being expanded towards institutionalization.
Department and GOCCs mandated to conduct
consultations
Bottom-up Budgeting
• For the first time in history, the National Budget for 2013 will be
prepared using a breakthrough "bottom-up" approach. As
opposed to the conventional way of allocating resources from
top to bottom, grassroots communities will be engaged in
designing the National Budget.
• The Aquino government, through the Cabinet Cluster on
Human Development and Poverty Reduction, has identified
300 to 400 of the poorest municipalities and will engage these
in crafting community-level poverty reduction and
empowerment plans. This initial salvo of "bottom-up"
budgeting will focus on rural development programs and the
conditional cash transfer program, and will thus involve DA,
DAR, DENR, DSWD, DepEd and DoH. These agencies will then
include the community plans in their proposed budgets.
Along these Cabinet Members will make commitments on programs and projects that they
will deliver. These decisions and commitments are then summarized in a budget priority framework that
will guide all agencies in crafting their respective Budget proposals and priorities.
3RD TECHNICAL HEARING (February to April)
Once the department and agencies submit their Agency Budget Ceiling (ABC) to the
DBM, the latter will call technical Budget Hearings where the agencies defend their proposed budgets
before a technical panel of DBM, based on performance indicators on output targets and absorptive
capacity.
4TH EXECUTIVE REVIEW (May to June)
The recommendations are presented before Executive Review Board which is composed
of the DBM Secretary and Senior officials.
5th CONSOLIDATION, VALIDATION and CONFIRMATION (end of June)
DBM then consolidates the recommended agency budgets and recommendations into a
National Expenditure Program (NEP) and a Budget Expenditures and Sources of Financing
(BESF). Heads of major departments are invited to this meeting.
6th PRESENTATION to PRESIDENT and CABINET (July)
The proposed budget is presented by DBM, together with the DBCC, to the President
and the Cabinet for further refinements or reprioritization. After the President and Cabinet approve
the proposed National Expenditure Plan, the DBM prepares and finalizes the budget documents to
be submitted to Congress.
7th PRESIDENTS BUDGET
Budget Expenditures and Sources of Financing (BESF)-mandated by the constitution, this contains
the macroeconomic assumptions, public sector context, breakdown of the expenditures
and funding sources for the fiscal year and two previous years.
National Expenditure Program (NEP) - this contains the details of spending for each department and
agency by program, activity or project, and is submitted in the form of a proposed General
Appropriations Act.
Documents included in the President Budget:
1. Book of Outputs - seeks to show the link between the budget and the
outcomes and outputs from the government activities.
1. Details of Selected Programs and Projects - this contains a more detailed

disaggregation of key programs, projects and activities in the NEP, especially
those in line with the national government’s development plan.
1. Staffing Summary - this contains a summary of the staffing complement of

each department and agency, including number of positions and amounts
allocated for the same.
Example of Staffing Summary:
II
*Budget
Legislation
B U D G E T P R E PA R AT I O N
Government funds shall only be spent in pursuance of an appropriation called the "budget authorization
phase". This starts upon the House Speaker’s receipt of the President’s budget and ends with the President’s
approval of the GAA.
1st House Deliberations (August to November)
- In plenary, the GAB is presented and defended by the Appropriations Committee and Sub-Committee
Chairmen, and the GAB is approved on 2nd and 3rd reading before transmission to the Senate.
2nd Senate Deliberations (August to November)
- Budget deliberations in the Senate formally begin after the House of Representatives transmits the GAB.
The Senate Finance Committee and Sub-Committee usually start hearings while the House is still in the
process of deliberating and thereafter approves on 2nd and 3rd reading.
3rd Bicameral Deliberations
- After both Houses of Congress have finished their deliberations, the Committee will discuss the
conflicting provisions of the House and Senate versions of GAB.
4th Ratification and Enrollment
- The harmonized or “Bicam” version is then submitted to both houses, which will then vote to
ratify the final GAB for submission to the president. Once submitted to the President for his
approval, the GAB is considered enrolled
5th The Veto Message
- The President and DBM review the GAB and prepare a Veto Message, where the budget
items subjected to direct veto or conditional implementation are identified, and where
general observation are made. Under the Constitution, the GAB is the only legislative measure
where the President can impose a line-veto.
6th Enactment - December
- The budget legislation phase ends when the General Appropriation Act (GAA) is signed by
the President as law. Ideally, enactment should happen not later than December 31 of the
GAA’s fiscal year. Otherwise, the previous year’s budget is reenacted in part, if the new
budget is approved not approved on time, it is re-enacted in full if no new budget is
approved at all.
III
*Budget
Execution
A process by which the financial resources made available
to an agency are directed and controlled toward achieving
the purposes and objects for which budgets were
approved.
Budget Execution
This is where the people’s money is actually spent. As soon as the

GAA is enacted, the government can implement its priority programs and
projects which the agency conduct pre procurement activities on August
of previous year for submission of Monthly Disbursement Program for
October of previous years.
Budget Execution
1ST 2ND 3RD
Budget Execution Documents (BEDS)– 3rd Allotment and Cash Release

Release Guidelines and submission of adjusted BED based on General Programming – January of current year
BED’s- December of previous Appropriation Act (GAA) January of current

- To ensure that releases fit the approved
year
year Fiscal Program, the DBM prepares an
Allotment Release Program (ARP) to set
- Agencies requires to submit their BEDs at
- The budget execution limit for allotments issues to an agency and
the start of budget execution. These
phase begins with on the aggregate. The ARP of each
documents outline agency plans and agency corresponds to the total amount
DBM’s issuance of performance targets. These BEDs include of the agency-specific budget under the
guidelines on the the physical and financial plan, monthly GAA, as well as Automatic Appropriations.
release and utilization cash program, estimate of monthly A Cash Release Program (CRP) is also
of funds. income, and list of obligations that are formulated alongside that to set a guide
not yet due and demandable. for disbursement levels for the year and for
every month and quarter.
Budget Execution
4TH 5TH 6TH
Allotment Release – March to May of current Incurring of Obligations Cash Allocation

year In implementing programs,
activities and projects, -To authorize an agency to pay the
-Agencies are required to submit an agency to agencies incur liabilities on obligation it incurs, the DBM issues a
enter into an obligation, are either released by behalf of the government. disbursement authority. Most of the
Obligations are liabilities time, it takes the form of Notice of
DBM to all agencies comprehensively through
legally incurred, which the
the Agency Budget Matrix (ABM) and Cash Allocation, and in special cases,
govt. Wii pay for. There are
individually via Special Allotment Release Orders various ways that an agency the Non-cash Availment Authority
(SARO) “obligates” for example, (NCAA) and Cash Disbursement
when hires staff, receives Ceiling (CDC)
-ABM-this document disaggregates all billings for the use of utilities, or
programmed appropriations for each agency enters into a contract with an -This is the final step of the budget
into two main expenditure categories: “not entity for the supply of goods execution phase, where government
needing clearance” and “needing clearance”. and services. monies are actually spent.
IV
Budget
Accountability
* B u d get A c c o u nta b i l i t y
This phase happens alongside the Budget execution phase. Through budget accountability, the DBM
monitors the efficiency of fund utilization, assesses agency performance and provides a vital basis for reforms
and new policies.
1st Performance targets and Outcomes
- Agencies are held accountable not only for how they use public funds ethically, but also on how they attain
performance targets and outcomes using available resources.
2nd Budget and Financial Accountability Reports (BFARS)
- Submitted by agencies on a monthly and quarterly basis. Required reports that show how agencies used their
funds and which identify their corresponding physical accomplishments.
3 Review of Agency Performance
rd
- The DBM regularly reviews the financial and physical performance of agencies. Actual utilization funds and
physical accomplishments as indicated in the agencies BFARS’s are evaluated against their targets as
identified via OPIF and in the agency’s BEDs.
4th Audit
- Auditing is not within the DBM’s jurisdiction and instead lodged under COA. Nonetheless,
auditing is critical in ensuring agency accountability in the use of public funds. DBM uses COA’s
audit reports in confirming agency performance, determining budgetary levels for agencies and
addressing issues in fund usage.
So when we say,
BY - Budget Year ( Current year + 1 year)
PY – Prior Year ( Current year – 1 year)
The government fiscal policies on budget affects the economy through the following
macroeconomic indicators (persistent rise in the general price level of goods and services):
- Increase in the GDP growth (measures the total output within the geographic boundaries of
the country, regardless of the nationality of the entities producing the output.
- Increase in inflation rate
- Increase in merchandise imports
- Increase in interest rates
- Depreciation in foreign exchange rate
The Budget and the TRAIN
To fund the priority social services and infrastructure programs, the Tax
Reform for Acceleration and Inclusion (TRAIN) Law transform the current complex and
unjust tax system to one that is simpler, fairer and most efficient way to promote fund
collection which aims to raise the significant revenues in support for the spending on
low income families and individuals.
Of the total gains from TRAIN, 70% will fund infrastructure projects (Build, Build,
Build Program – concreting of national and local roads, road access to isolated
barangays and sitios and irrigation of farm lands ) while 30% will go to social services
(program for sugar farmers and social mitigating features which is the health and
education for a 100% enrollment and completion rates for all levels, classroom built and
teachers hired and establishing hospital and upgrading local hospitals)
Fe at u re s o f T R A I N
 Reduction of income taxes for 99% of income tax payers on the 13th month pay and
other bonuses amounting to P90,000 are tax exempt.
 Broadening of the consumption tax base
 Promotion of a healthier lifestyle as sugar-sweetened beverages are taxed
(additional P6 per liter for drinks using sugar and artificial sweetener and P12 per liter
for drinks using high fructose corn syrup ) but with exception to 3-1 coffee, milk and
100% natural juices.
 Protection of the environment by increasing the excise tax on dirty fuel.
 Updating of the excise tax on automobiles, coal, cosmetics and cigarettes.
Government spending can be classified using the Classification of the Functions of
the Government (COFOG) system which takes considerations to the nature of the
expenditure of an agency.
 General Public Service  Housing and Amenities
 Defense  Education
 Public Order and Safety  Health
 Economic Affairs  Social Protection
 Environmental Protection  Recreation, Culture and Religion

B u d get by E x p e n s e C l a s s i f i cat i o n
• Personal Services (PS) – includes payment of salaries, wages and other
compensation such as merit increases, salary increases, cost of living allowances,
and honoraria.
• Maintenance and Other Operating Expenses (MOOE) – this supports the operations
of the government agencies, including expenses for supplies and materials,
transportation and travel, utilities, and repairs.
• Capital Outlays (CO) Financial Expenses (FinEx) – expenditures for the purchase of
goods and services.
• Financial Expenses (FinEx) – refers to management supervision, trusteeship fees,

interest expenses, guarantee fee, bank charges, commitment fees, and other
financial charges incurred by the agencies when owning or renting an asset or
property or availing of financial services.
GOCCs budget subsidy increases which attributed to the
following:
 Implementation of targeted cash transfer

program for the poor families;
 Increase coverage of senior citizens from six (6)

months to one (1) year by the Philippine Health
Insurance Corporations (PHIC), and;
 Additional subsidy for Public Utility Vehicle (PUV)

modernization program.
To p Te n ( 1 0 ) B u d g e t R e c i p i e n t f o r 2 0 2 0 :
• Department of Education (DedEd) including SUCs, CHED and TESDA)
• Department of Public Works and Highways (DPWH)
• Department of the Interior and Local Government (DILG)
• Department of National Defense (DND)
• Department of Social Welfare and Development (DSWD)
• Department of Health (DOH) including PHIC’s budget
• Department of Transportation (DOTr)
• Department of Agriculture (DA)
• The Judiciary Doctor (JD)
• Autonomous Region in Muslim Mindanao (ARMM)

Budget by Region Distribution:
• NCR • Region 4B
• Region 3 • Region 2
• Region 4A • Region 9
• Region 6 • Region 12
• Region 5 • CARAGA
• Region 7 • ARMM
• Region 11 • CAR
• Region 10 • Bangsamoro Organic Law (BOL)
• Region 8
• Region 1
Special Purpose Fund - This refer to appropriation in the National Budget allocated for specific
purposes, covering lump sums and disaggregated. There are lump sums because recipients of
these funds (departments, agencies or programs/projects of National Government) have not yet
been disaggregated during budget preparation and legislation.
Disaggregated Funds
- Budgetary Support to Government Corporations as assistance of the National Government to
Government-Owned and/or Controlled Corporations (GOCCs) in the form of equity and
subsidy.
- Allocation to LGUs ( Special Shares in the Proceed of National Taxes, Local Government
Support Fund and Metropolitan Manila Development Authority
- Miscellaneous Personnel Benefits Fund cover creation of new positions for teachers, policemen,
firemen, and jail officers in the government; compensation adjustment, and other personnel
benefits
- Pension and Gratuity Fund for the payment of pension, retirement and terminal leave benefits,
and monetization of leave credits of government employees.
Lump-Sum Funds
- National Disaster Risk Reduction and Management Fund (NDRRMF) for disaster risk
reduction, mitigation, prevention and preparedness activities.
- Contingent Fund – new and urgent programs projects that need to be implemented or
paid during the year.
- Allocation to Local Government Units (LGUs) corresponding to their share in the national
revenue collection.
Prepared by:
Masilang, Kristine F.
Nilooban, Rommel A.
Oates, Yeng Christel B.
Omlas, Angelica R.
Paredes, Marielle Kaye E.
Racsag, Iris Jill C.
Ramos, Pamela D.
Regalado, Germaine Irish R.
Reyes, Xela Marie O.
Rodriguez, April Grace B.
Romana, Mark Angelo L.
BPA-3B
and Budgeting
Learning Objectives
Introduction
The government
accounting process comprises this
activities of analyzing,recording,
classifying, summarizing and
communicating transactions
involve the receipts and
disposition of government funds
and property, and interpreting
the result thereof.
The fundamental principles establish the basic concept upon
which the detailed accounting system is built.
a. No money shall be paid out of any public treasury or depository except in

pursuance of an appropriation law or other specific statutory authority.
b. Government funds or property shall be spent or used solely for public purposes.
c. Trust funds shall be available and may be spent only for the specific purpose for
which the trust was created or the funds received.
d. Fiscal responsibility, to the greatest extent, shall be shared by all those exercising
authority over the financial affairs, transactions, and operations of the government
agency.
e. Disbursements or disposition of government funds or property shall invariably bear
the approval of the proper officials.
f. Claims against government funds shall be supported with complete
documentation.
g. All laws and regulations applicable to financial transactions shall be faithfully
adhered to.
h. Generally accepted principles and practices of accounting as well as of sound
management and fiscal administration shall be observed, provided that they do
not contravene existing laws and regulations.
Book of Accounts
and Registries
(Journals, Ledgers and Registries)

JOURNALS
 Cash Receipt Journal (CRJ)

 Cash Disbursement Journal (CDJ)
 General Journal (GJ)
 Check Disbursement Journal
LEDGERS
 General Ledgers (GL)

 Subsidiary Ledger (SL)
Registries
(Budget Records)
 Registries of Revenue and Other Receipts (RROR) – used to

monitor the budgeted amounts, actual collections and
remittances of revenue and other receipts.
 Registries of Appropriation and Allotments (RAPAL) – used to
monitor appropriations and allotments will not exceed
appropriations. Registries of Allotments, Obligations and
Disbursement (RAOD) – used to monitor allotments received,
obligations incurred against the corresponding allotment, and
the actual disbursement made. This is to ensure that obligations
incurred will not exceed allotments while actual disbursements
will not exceed the obligations incurred.
 Registries of Budget Utilization and Disbursements (RBUD) – use to
record the approved special budget and the corresponding
utilizations and disbursement charged to retained income.
Incurrence of
Obligation
Obligation Request and Status (ORS) – this
obligation shall be incurred through the issuance of
the ORS.
The Requesting Office shall prepare the document, supported by valid claim
documents like disbursement vouchers, payroll, purchase orders, itinerary of
travel, cash advance and others.
The Head of the Requesting Office shall certify the necessity and legality of
obligation and the validity of the supporting documents.
The Head of the Division shall certify the availability of allotment.

A. The Obligation Request shall be prepared in three
copies, to be distributed as follows:
Original Triplicate
to be attached to the
Accounting Unit
DV
Duplicate
Budget Unit
B. The Budget Unit shall stamp the date of receipt on
the face of this form.
C. This form shall be accomplished in the following manner:
1. No. – number
assigned to the
Obligation Request
by the Budget Unit
or its equivalent.
2. Payee – name of payee or creditor.
3. Office – name of the office of payee or creditor
4. Address – address or location of the office of the payee or creditor.
5. Responsibility Center – code of the cost center where expenses shall be
charged.
6. Particulars - brief description of the obligation requested
7. F.P.P. – code for function/program/project as shown in the approved
appropriation/ allotment.
8. Account Code – expense/asset/liability account code where the obligation
shall be charged.
9. Amount – amount of obligation/ adjustment.
10. Certified (Box A) – Certification by the Head of the Requesting Office or his
authorized representative on the necessity and legality of charges to the
appropriation/allotment under his direct supervision, and validity, propriety
and legality of supporting documents.
10. Certified (Box B) – Certification by the Head of the Budget Unit or his
authorized representative on the existence of available appropriation.
D. Any correction/adjustment by
the Accounting Unit which will require
the corresponding adjustment in the
appropriate RAAO shall be coordinated
with the Budget Unit.
Notice of Request Status and Adjustment (NORSA)
If the obligations recorded in the RAODs and ORS the above need to
adjust through the use of Notice of Request Status and Adjustment (NORSA). The
adjustment shall be effected through a positive entry (addition) or negative
entry (reduction).
Obligations
In business entity it is a liability, but in government entity an
authorization pursuant to the law or other legislative enactment directing the
spending of public funds foe specified purposes, up to the specified amount
under specified conditions. It may be referred to as commitment that
encompasses possible future liabilities based on current contractual
agreement.
Notice of Cash
Allocation (NCA)
ABC receives Notice of Cash Allocation (NCA) from the Department of Budget and
Management amounting to P500,000, net of tax.
Date Particulars Debit Credit
1/2/2020 Cash-Modified Disbursing System Regular 300,000

Subsidy from National Government 300,000
The Notice of Cash Allocation monitor in registries
• Registry Allotment and Notice of Cash Allocation (RANCA) to determine the

amount of allotments not covered by the NCA.
• Registry Allotment and Notice of Transfer of Allocation (RANTA) to determine the
amount of allotments not covered and monitor the Notice of Transfer Allocation
(NTA) balance.
Journals
• General Journal – used to record transactions not recorded in special Journals.
• Special Journals
 Cash Receipts Journal – use to record the Report of Collection and Deposit
and Cash Receipts Registers of Collecting Officers (Cashier)
 Report of Collection and Deposit (RCD) prepared by Collecting Officer to
report the collections and deposits to an Authorized Government Depository
Bank (AGDB).
 Cash Receipts Register (CRReg) used by the field officer without a complete
of books to record their cash collections and deposits of their mother unit
(central, regional, division office).
• Cash Disbursement Journal used to record the cash disbursement CDJ of the
Disbursing Officer.
Ledgers
• General Ledger – summarizes all transactions recorded in the journals. Account in
the general ledger are arranged according to their sequence in the Revises Chart of
Accounts.
• Subsidiary Ledger – show the details of each control account in the general ledger
 Notice of Cash Allocation
 The journal entry for the NCA is posted to the general ledger as
follows:
 Employees settlement, liquidation, payment of government
obligations incurred in the current or prior years, involving cash or
non-cash transactions covered by disbursement authorities.
 Payable to Employees
 Liquidation of Payroll
Tax Remittance Advice (TRA) is used to recognized
• In the books of the government agencies, the remittance of taxes withheld to the
Bureau of Internal Revenue (BIR)the constructive receipt of NCA;
• In the BIR books, the constructive receipt of tax revenue;
• In the books of Bureau of the Treasury (BTr) the constructive receipt of the tax.
 Books of Entity ABC

 Books of BIR
 Books of BTr
 Summary of
Basic
Recording
Criteria in Keeping the Accounts of Government
The following are the criteria in keeping the accounts of the government:
a) The accounts of an agency shall be kept in such detail as is necessary to meet

the needs of the agency and at the same time be adequate to furnish the
information needed by fiscal or control agencies of the government.
b) The highest standards of honesty, objectivity and consistency shall be
observed in the keeping of accounts to safeguard against inaccurate or
misleading information.
In all countries, regardless of the overall approach, the accounting practices used
and the data developed should satisfy the following criteria:
 Simplicity. The accounting system should include those records that serve
significant purpose. Excessive details and unnecessary records should be
avoided. There should be no evidence of “accounting for accounting’s sake.”
 Timely, accurate, reliable and meaningful data in relation to an identified need.

All transactions that occur within an accounting period should be recorded in
accounts and reflected in reports which are available shortly after the close of
the period. Recorded data should accurately describe the financial transactions
and results that will avoid misleading reports.
 Usefulness of financial data. The data can be used for the purposes of
accountability or management. To serve these purposes, the data must be
promptly presented, properly organized, clearly reported, impartial and its
significance and usefulness clearly understood by all stakeholders, so that they
are effectively utilized for management purposes.
Recording of Transactions
 Each government agency records its financial transactions and operations in

conformity with generally accepted accounting principles and in
accordance with pertinent laws and regulations.
 Generally Accepted Accounting Principles (GAAP). The body of principles

that governs the accounting for financial transactions underlying the
preparation of a set of financial statements.
Fund Accounting
System
A system used by non-profit organizations,
particularly governments, to ensure
compliance with laws and regulations.
Fund Accounting System
The main purpose is stewardship of financial resources received and
expended in compliance with legal requirements. There is no profit motive,
“accountability” is measured instead of profitability.
Terminologies
 Financial reporting - directed at the public rather than investors.
 The accounting equation is Assets = Resources on Assets.
 Fund - self-balancing set of accounts recording cash and other financial resources.
Fund distinguished from Cash and Appropriation
 Cash is the sum of money in the treasury or in the bank and is only one
type of asset composing a fund.
 When using the term fund, it should not be confused with cash and
appropriation.
 A fund consists of all resources, including cash, which have been created
or designated for a particular purpose only.
Appropriation
 Appropriation is an authorization made by law or other legislative enactment directing the
payment of goods and services out of government funds under specified conditions or for
a specified purpose.
 An appropriation is always made by a legislative body.
 No expenditures may be made out of certain funds, i.e., the general fund, without an
appropriation.
 A single appropriation may be made out of several funds.

Sources of appropriations:
1. New General Appropriations refer to the portion of National Budget submitted
annually every fiscal to congress for legislation and approval. These appropriations
consist of the:
• Programmed New General Appropriations refer with the landmark shift to cash-
based budgeting which limits new appropriations to only program, activities
and projects (PAPs) for the year allocated for department/agencies and
Special Purpose Funds.
• Unprogrammed New General Appropriations refer to standby authorities

granted by Congress to be released once revenue collections in any one of the
support for foreign assisted projects, support to GOCCs, payment of pension
and gratuities and others.
2. Automatic Appropriations, funds are covered by outstanding legislation which do

not require periodic action by the Congress and need not be included in the
legislation of the annual budget.
Basis or Method of
Accounting
Methods of Accounting
The method of recognizing revenues and expenses is known as the basis of
accounting. Regardless of the measurement focus used, it refers to the timing of the
recognition of revenues and expenditures in the accounts and those reported in the
financial statements.
Terminologies
 Transactions are recognized when they occur, regardless of the timing of
accompanying cash flows, using the accrual method of accounting.
 Revenues are recognized and quantified in the accounting period in which they
are earned. If an expense is measurable, it is recognized at the time it is incurred.
The accrual method of accounting is used to accurately match income and
spending in the appropriate period.
 Transactions are only recognized when cash changes hands under the cash basis
of accounting. When cash is received, revenues are recorded in the accounts,
and when cash is dispensed, expenditures are documented.
 Assets and liabilities not deriving from cash transactions are not recognized in
cash basis financial statements.
Important Accounting Basis/Methods, Definitions, and Concepts
 The amount of money paid for products and services is referred to as expenditure.
It also involves the enactment of a legal responsibility to pay.
 The cost of goods and services spent in the process of achieving the
organization's goals is referred to as expenses.
 Amounts of an asset used (e.g. depreciation) or a liability incurred (e.g. creditor's

amount) are used to calculate them.
Budgetary
Accounts System
under NGAs
Budgetary Accounts System under NGAS
The Budgetary Accounts System encompasses the processes
of preparing Agency Budget Matrix (ABM) monitoring and recording of allotments.
• It received by the agency from the Department of Budget and Management
(DBM);
• In releasing the Sub-Allotment Release Order (SubSARO) to Regional Offices
to the Central Office;
• Issuance of Sub-SARO to Operating Units by the Regional Office; and
• Recording and monitoring of obligations
Agency Budget Matrix (ABM) - A document showing the disaggregation of

agency expenditures into components like, among others, by source of
appropriations, by allotment class, and by need of clearance.
Allotment Release Order (ARO) - A formal document issued by the DBM to

the head of the agency containing the authorization, conditions and
amount of an agency allocation.
Appropriation
- is an authorization made by law or other legislative enactment for payments to be
made with funds of the government under specified conditions and/or for specified
purposes.
Kinds of Appropriation
1. Annual Appropriations
2. Special Appropriations
3. Supplementary Appropriations
4. Interim Appropriations
5. Continuing Appropriations
6. Standing Appropriations or Automatic
Appropriations
Terminologies
 Allotment - is an authorization issued by authorities (the DBM for national

government agencies or the Local Chief Executive (LCE) for LGUs) to an
agency/LGU which allows it to incur obligations within a specified amount that is,
within a legislative appropriation.
 Notice of Cash Allocation - is an authorization issued by the DBM to an agency to

withdraw cash from the Bureau of the Treasury to pay expenses incurred, purchases
of materials and fixed assets, payment of payables, and other authorized
disbursements thru the issuance of MDS Checks or other modes of disbursements.
 Obligations - are commitments by a government agency arising from an act of a

duly authorized government officer binding the government to incur expenses,
purchases and other operational requirements of the agency and the immediate or
eventual payment of a sum of money.
The Revised Chart
of Accounts
Chart of Accounts
It provides the framework within which the accounting records are constructed. It is
a list of general ledger accounts consisting of real and nominal accounts. (it
contains the accounts name, a brief description of the account, and an account
number.)
• The chief purpose of the chart accounts is to serve as an aid or reference
for looking up accounts and their associated account numbers.
• To permit effective budgetary control and to establish uniformity in
financial reports, accounts shall be classified in balanced fund groups.
Types of Accounts
• Asset accounts
• Liability accounts
• Equity accounts
• Revenue or income Accounts
• Expense accounts
• Contra-accounts
All accounts…
 …can be debited and credited;

 …have an increase side (column) and a decrease side (column)
 …have a debit side (column) and a credit side (column)
 …debit side is the left side (left column)
 …credit side is the right side (right column)
 …are classified as an asset, liability, equity, revenue, expense
 …are either a real (balance sheet) or nominal (income statement) account
 …have a normal balance amount that is normally a debit balance or a credit
balance
Real Accounts – These are the balance sheet accounts for assets, liabilities and equity
accounts.
Nominal Accounts – These are the income and expense accounts.
Normal Balance – the debit or credit balance that an account is expected to have.
Account Classification Normal Balance
Asset Debit
Contra Asset Credit
Liabilities Credit
Contra Liabilities Debit
Owners Equity Credit
Owners Drawing Debit
Revenue Credit
Expense Debit
Gain Credit
Assets - These are properties used in the operation or investment activities of an
entity.
Liabilities - These are claims by creditors to the property (assets) of an entity until
they are paid.
Equity = Assets minus liabilities.
Income - The gross increase in equity resulting from the operations and other
activities of the entity.
Expenses - Decrease in equity (capital) resulting from assets, and services and
supplies consumed in the operations of an entity.
Unified Account
Code Structure
(UACS)
Funding Source
It consists of financial resources of the government set aside for specific
purposes to finance the programs, activities and projects of the government. This
includes:
 General Fund – composed of all receipts and revenues available for any purposes
that congress may choose to apply and do not otherwise accrue to other funds.
 Off-Budgetary Fund (Retained Income or Revolving Funds) – refers to the receipts

for expenditure items that are not part of National Expenditure Program(NEP), and
which are authorized to be deposited in government AGBD of financial institutions
and shall be part or will be addressed thru the Treasury single account.
 Trust Receipts/Custodial Fund – receipt or cash received by any government

agency whether from private source or another agency to fulfil a specific
purpose. This includes receipts collected by an agency, as an agent for another
entity.
1) New General Appropriation –are annual authorizations for incurring obligations
during a specified budget year, as listed in the General Appropriations Act (GAA).
2) Continuing Appropriations are authorizations to support obligations for a specified
purpose or project, even when these obligations are incurred beyond the budget
year.
3) Supplemental Appropriations are additional appropriations enacted by Congress
to augment original appropriations that have proven insufficient for their intended
purpose because of economic, political or social conditions.
4) Automatic Appropriations are authorizations made annually or for some other
period prescribed by law, by virtue of standing legislation, which do not require
periodic action by the Congress.
5) Unprogrammed Funds are standby appropriations for priority programs or projects
of the government. The utilization of Unprogrammed Funds may be approved if
any of the following conditions are met:
 Revenue collections for the year exceed targets
 New revenues not included in the original revenue targets are successfully
generated, or
 Foreign loan proceeds are generated for newly approved projects covered by
perfected loan agreements.
6) Retained Income/Funds are collections that are authorized by law to be used
directly by agencies for their operation or specific purposes. These include but are
not limited to receipts from:
 State Universities and Colleges (SUCS) - · Department of Health (DOH) -

hospital income such as hospital fees; medical, dental and laboratory
fees; rent income derived from the use of hospital equipment and
facilities; proceeds from sale of hospital therapeutic products,
prosthetic appliances and other medical devices; diagnostic
examination fees; donations in cash from individuals or
nongovernment organizations satisfied with hospital services.
7) Revolving Funds are receipts derived from business-type activities of

departments/agencies as authorized by law, and which are deposited in an
authorized government depository bank.
8) Trust Receipts are receipts that are officially in the possession of government
agencies or a public officer as trustee, agent, or administrator, or which have been
received for the fulfilment of a particular obligation. These receipts may be classified
as:
 • Inter-Agency Transferred Funds (IATF),
 • Receipts deposited with the National Treasury other than IATF and,
 • Receipts deposited with Authorized Government Depository Bank
Expenditure Coding
Examples of Funding Source Codes:
 New General Appropriations
Financing Authorization Fund Category
General Fund 1 New General Appropriation Specific Budgets of National

1 01 Government Agencies 101
General Fund New General Appropriation Pension and Gratuity Fund

1 01 407
The Organization Code is structured into three segments:
1. Department
2. Agency
3. Lower Level Operating Unit/Revenue Collecting Unit.
Organization Code
12 Digits
Department Agency Lower Level Operating Unit

1st and 2nd digits 3rd to 5th digits 6th to 12th digits
How is Fund Code 101 in UACS?
Fund Cluster Financing Authorization Fund Categories
Source Code
01 1 01 101
01 Regular Agency 1 General Fund 01 New General 101 - Specific Budget of NGA's
Fund Appropriations
02 Foreign Assisted 2 Off-Budgetary 02 Continuing 102 - Retirement and Life Insurance

Project Fund Appropriations
03 Special Account 3 Custodial Fund 03 Supplemental 151 - GOP Counterpart Funds

(Locally Funded) Appropriations
04 Special Account 04 Automatic 163 - International Bank of

( Foreign Assisted) Appropriations Reconstruction and Development
(IBRD)
06 Business Related 06 Retained 406 - Miscellaneous Personnel
Funds Income Benefit Fund (MPBF)
07 Trust Receipts 07 Revolving 407 - Pension and Gratuity

Funds Fund
08 Trust Receipts 409 - Allocation for Capital

Outlays of SUC's
321 - 400 Special Accounts
421 – Un programmed Funds
441 - Retained Income

Prepared by:
Rosales, Kristine C.
Roxas, Gillor P.
Suarez, Romscell Anne A.
Sumilang, Mark Jason P.
Tagon, Kemuel “ARAM” R.
Tuliao, Aziel A.
Veluz, Claudette
Villa, Patricia M.
Villamater, Mizzy P.
Villaverde, Jane Shyreen R.
BPA-3B

BPA07 Public Accounting Budgeting

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BPA07: Public Accounting

After this lesson, the student should be able

The accounting process recording financial

encompasses the process of analyzing,

An event or condition, the

a. To produce information concerning past operations and present

o Government resources shall be utilized efficiently and effectively in

o Except as permitted by law, transfers of government funds monies from one

• It contains general provisions, basic standards and policies, the specific

Investments asset or item acquired for generating income

- list of general ledger accounts consisting of the real and

Asset Account Debit- left side of an account

Type of characters involves in the Accounting

Entry: Equipment P 30,000

Therefore: Debit is equipment because you owned the

Entry: Equipment P 30,000

Therefore: Debit is Equipment because you paid the laptop using

Entry: Accounts Payable P 30,000

Therefore: Debit is Accounts Payable because you paid what you

Entry: Accounts Receivable P 20,000

Therefore: Debit is Accounts Receivable because you collected cash for

Entry: Cash P 20,000

Entry: Rent Expense P 10,000

Therefore: Debit is Rent Expense because you paid for rental

Decrease in Asset Increase in Asset

- equity increases if the revenue is more than the expense

- equity increases if there is an additional cash for the business.

- equity decreases if the cash return to the owner for withdrawal.

a. Government accounting plays a vital role in the government

Control Obligation Accounting provides the ceiling No Obligation Accounting

Budgetary and real (actual) Nominal and real accounts are

Analyze transactions and business documents.

Post journal entries to ledger accounts.

Determine account balances and prepare a trial balance.

Journalize and post adjusting entries.

a. brings balance sheet accounts to be current

A worksheet is prepared before

b.) Prepare financial statements.

Commission on Audit (COA)

Department of Finance (DOF)

Bureau of the Treasury (BTr)

Department of Budget and Management (DBM)

• Results - Based Management (RBM) – refers to overall approach in managing projects,

When an intervention is required, an assessment can include an initial analysis and

During implementation of projects, activities and programs

“Monitoring” is defined the routine

Monitoring systems should be

Evaluation is defined as an assessment of a systematic ongoing or

In developing an intervention, it is vital to have a scope of the:

OFFICE _________________ SECTORAL_________

VII – PROJECT LOGICAL FRAMEWORK

VIII - PROJECT DOCUMENTATION AND LOCATION

Planning consists of determining solutions

Strategic planning is the process of deciding where an organization wants to get

Planning takes into

If the information collected appears to be inaccurate, incomplete or biased, it

• to assess the problems, interests and • Identifying core strengths,

• to get an idea of the main • It is an intervention that must be

01 1. Policy support measures

4. Institutional and management capacity

7. Economic and financial issues

1. Procurement of all government agencies

OFFICE _________ SECTORAL_