REVENUE and

OTHER RECEIPTS
 All revenue accruing to the departments, offices and agencies
shall be deposited in the NATIONAL TREASURY of the
government or in any AUTHORIZED DEPOSITORY of the
government and shall accrue to the GENERAL FUND of the
government unless otherwise provided by law.
 SOURCES OF REVENUE
EXCHANGE NON-EXCHANGE
TRANSACTIONS TRANSACTIONS
Sale of goods Tax revenue
Provision of services Fines and Penalties
Use by others of entity assets Shares, grants and donations
Present obligation recognized as a
liability is satisfied
RECOGNITION and MEASUREMENT
– EXCHANGE TRANSACTIONS
• Recognized when it is probable that future
economic benefits or service potential will flow to
the entity and the benefits can be measured reliably
• Measured at fair value of the consideration received
or receivable, less any trade discounts and volume
rebates
 REVENUE RECOGNITION –
EXCHANGE TRANSACTIONS
SOURCE REVENUE RECOGNITION
Sale of goods • Significant risks, ownership transfer
• No managerial involvement/control
Provision of service • Stage of completion
Interest Income • Effective yield on the asset
Royalties • As earned
Dividends • Right to receive payment is established
RECOGNITION AND MEASUREMENT
– NON EXCHANGE TRANSACTIONS
• Recognize ASSET when agency gains control of the resource and meet
recognition criteria at FAIR VALUE at the date of acquisition
• Measure LIABILITY at the best estimate of the amount required to settle
the present obligation at the reporting date
• REVENUE is measured at the amount of increase in net assets
recognized by the entity UNLESS it is also necessary to recognize a
liability
 REVENUE RECOGNITION – NON
EXCHANGE TRANSACTIONS
Revenue Source Recognition
Taxation Revenue At gross amount when collected
Gifts and Donations other • Future economic benefits or service potential flow to
than Services in Kind the entity
• Fair value can be measured reliably
Goods in kind without Immediately
consideration

Donation in cash/kind Revenue

 REVENUE RECOGNITION – NON
EXCHANGE TRANSACTIONS
Revenue Source Recognition
Taxation Revenue At gross amount when collected
Gifts and Donations other • Future economic benefits or service potential flow to
than Services in Kind the entity
• Fair value can be measured reliably
Goods in kind without Immediately
consideration

Donation in cash/kind Revenue

 TAX REVENUE
• Income tax
• Value added tax
• Goods and services tax
• Customs duty
• Death duty
• Property tax
 TRANSFER OF IRA
DBM Books:
Financial assistance to LGUs xx
Cash – MDS, Regular xx
 NON PAYMENT NON ACCEPTACE
DISHONORED • Duly presented for • Duly presented for
payment and payment acceptance, and such
CHECKS is refused or cannot be acceptance is refused
obtained or not obtained
• Presentment is • Presentment for
excused and the check acceptance is excused
is overdue or unpaid and the check is not
accepted

• Dishonored by AGDB due to DAIF or DAUD

 Drawer continues to be liable for the sum due including penalties
 Insufficient funds – criminal liability
 CASH OVERAGE/SHORTAGE
SHORTAGE OVERAGE
 Not restituted by CO despite  Discovered by the auditor that
written demand from auditor – cannot be satisfactorily explained
Receivable from the CO by the CO will be forfeited in
favor of the government
 Taken up as miscellaneous
income
 CASH SHORTAGE/OVERAGE
OVERAGE SHORTAGE
Cash-CO xx Due from O&E xx
Misc. Income xx Cash-CO xx
Cash-CO xx
Cash-T/AD,Reg xx Due from O&E xx
Cash-CO xx Cash-T/AD,Reg xx
Cash-CO xx
 Collection of refund of excess
REFUND OF Cash-CO xx
ADVANCES Advances for OPEx xx
Advances to officers and
employees xx
Advances for payroll xx
Advances fro SDO xx

Remittance of collection to BTr

Cash – T/AD, R/SA/Txx
Cash – CO xx
 REFUND OF
OVERPAYMENT
Collection of refund of overpayment
OF EXPENSES Cash-CO xx
Specific Expense Account xx

Remittance of collection to BTr

Cash – T/AD, R/SA/Txx
Cash – CO xx
CANCELLED
CHECKS
• Voided, Spoiled or unclaimed stale
• Stale checks - reported as cancelled in the
LUC
• Voided
• New checks will be issued as replacement
• Spoiled which will be reported in the RCI
 Cancellation and Replacement of Stale/Voided/Spoiled
MDS check issued in the current year
Account Title
Cash-Modified Disbursement System (MDS), Regular xxx  
Accounts Payable   xxx
To recognize the cancellation of stale/voided/spoiled MDS checks
 
Accounts Payable xxx  
Cash-Modified Disbursement System (MDS),  
Regular xxx
To recognize the replacement of stale/voided/spoiled MDS checks.
       

Cash-Modified Disbursement System (MDS), Regular xxx  

Appropriate Account   xxx
To recognize the cancellation of stale/voided/spoiled MDS checks without replacement
 Cancellation and Replacement of Stale/Voided/Spoiled
MDS check issued in the prior year

Account Title
Accumulated Surplus/(Deficit) xxx  
Accounts Payable   xxx
To recognize the cancellation of stale/voided/spoiled MDS checks
 
Accounts Payable xxx  
Cash-Modified Disbursement System (MDS), Regular   xxx
To recognize the replacement of stale/voided/spoiled MDS checks
       
Accumulated Surplus/(Deficit) xxx  
Appropriate Account   xxx
To recognize the cancellation of stale/voided/spoiled MDS checks without replacement
 Cancellation and Replacement of Stale/Voided/Spoiled
Commercial check issued in the current and prior year

Account Title
Cash in Bank-Local Currency, Current Account xxx  
Accounts Payable   xxx
To recognize the cancellation of stale/voided/spoiled commercial checks
 
Accounts Payable xxx  
Cash in Bank-Local Currency, Current Account   xxx
To recognize the replacement of stale/voided/spoiled commercial checks
       
Accumulated Surplus/(Deficit) xxx  
Appropriate Account   xxx
To recognize the cancellation of stale/voided/spoiled commercial checks without
replacement.
 DISALLOWANCES

• Disallowances shall be taken up in the books of

accounts only when they become final and executory
• Cash settlement of disallowances shall be
acknowledged through the issue of an official receipt
and reported by the Cashier in the RCD