CRUCIAL RESOURCES & ACQUISITION PROGRAM

Session 1:
Accounting Standards on Property Plant and
Equipment
DepEd Toledo: Malipayong Alagad sa Edukasyong de Kalidad
Silak DepEd Toledo!
“The most valuable resource that all
teachers have is each other. Without
collaboration our growth is limited to
our own perspectives”

-Robert John Meehan-

Schools Division of Toledo City

Session Objectives
1. Discuss the general Guidelines and Procedures in the
Conduct of Physical Count of Property, Plant and
Equipment (PPE);
2. Recognition of PPE Items Found at Station and
Disposition for Non-existing/missing PPE Items; and
3. Conduct One-Time Cleansing of PPE Account Balances of
Government Agencies .

Schools Division of Toledo City

 Guide Questions:

1. Why do we need to discuss the general Guidelines and

Procedures in the Conduct of Physical Count of Property,
Plant and Equipment (PPE)?

2. Why do we need to recognize the PPE Items Found at

Station and Disposition for Non-existing/missing PPE
Items?

3. Why do we need Cleansing of PPE Account Balances of

Government Agencies?
Schools Division of Toledo City
Activity 1 (Course Overview)
“Vital words on PPE Items”

Schools Division of Toledo City

Activity 1 (Course Overview)
“Vital words on PPE Items”
Z P P E S F W E I F A V D A T E
F R E G G A T Q N U C S P O D L
M O D E L B E U V I Q E R U C B
A P G B S F A I E G U N O P I A
S E R I A L D P N C I I C L R T
B R J N C O S T T O S L E A C N
E T D V Z G R E O D I E D N U U
H Y N U M B E R R E T D U T L O
C H E C K E R N Y S I I R D A C
R O T A D I L A V J O U E E R C
D E S C R I P T I O N G S R G A

Schools Division of Toledo City

COA Circular 2020-006
January 31, 2020
• Guidelines and Procedures in the Conduct of Physical
Count of Property, Plant and Equipment (PPE), Recognition
of PPE Items Found at Station and Disposition for Non-
existing/missing PPE Items, for the One-Time Cleansing of
PPE Account Balances of Government Agencies

Schools Division of Toledo City

1.0 RATIONALE
Property, Plant and Equipment (PPE) generally constitute a significant portion of the total
assets of the government, usually comprising more than fifty percent thereof.
The existence of enormous amounts of discrepancies in PPE account balances of
government agencies has become a perennial issue and caused the non-establishment of
the accuracy of the PPE balances presented in the financial statements. Such condition,
is not properly addressed would always cause an exception in the fairness of
presentation of the financial position of government agencies and will deprive the
government of reliable and useful information in decision making and accountability for
these assets.
Thus, there is a need to provide guidelines and procedures to assist government agencies
in coming up with reliable PPE balances that are verifiable as to existence, condition and
accountability.

Schools Division of Toledo City

2.0 COVERAGE
• This Circular shall cover National Government
Agencies, Local Government Units, and Government-
Owned or Controlled Corporations.

Schools Division of Toledo City

3.0 PURPOSE
• This Circular prescribes the guidelines and
procedures on inventory taking, recognition of
those found at station and disposition for non-
existing/missing PPE for one-time cleansing of
PPE accounts of government agencies to establish
PPE balances that are verifiable as to existence,
condition and accountability.

Schools Division of Toledo City

4.0 ACCOUNTING STANDARDS ON PPE
4.1 PPE are tangible items that are:

a. purchased, constructed, developed or otherwise acquired;

b. held for use in the production or supply of goods or services or to
produce program outputs;
c. for rental to others (other than investment property);
d. for administrative purposes;
e. expected to be used during more than one reporting period; and
f. not intended for resale in the ordinary course of operations
Schools Division of Toledo City
ACCOUNTING STANDARDS ON PPE
4.2 The cost of an item of PPE shall be recognized as asset if, and
only if;

a. it is probable that the future economic benefits or service

potential associated with the item will flow the entity
b. the cost of fair value of the item can be measured reliably;
c. beneficial ownership and control clearly rest with the government
d. the asset is used to achieve government objectives; and
e. it meets the capitalization threshold of P 15,000.00

Schools Division of Toledo City

ACCOUNTING STANDARDS ON PPE
4.3 The carrying amount of an item of PPE shall be derecognized on
disposal or when no future economic benefits or service potential
is expected from its use or disposal

Schools Division of Toledo City

5.0 GENERAL GUIDELINES

• 5.1 Each government agency shall conduct physical count of all its
PPE, whether acquired through purchase or donation, including
those constructed by administration and found at station

• 5.2 The Head of the Agency shall create and Inventory Committee
composed of adequate number of members to be able to complete
the physical inventory in three months or less. The Inventory
Committee shall have at least one member each from the
Accounting and Property Division of the Agency.

Schools Division of Toledo City

GENERAL GUIDELINES

• 5.3 The members of the Inventory Committee shall be

temporarily relieved of all their regular duties to devote their full
time in the conduct of the physical inventory taking until all the
same is completed.
• 5.4. The entire inventory taking shall be witnessed by the
Commission on Audit (COA) Auditor. The audit team members may
be assigned for the purpose.
• 5.5. The Head of the Agency may also require a representative
from the agency’s Internal Audit Service/Unit to witness the
inventory taking.

Schools Division of Toledo City

 GENERAL GUIDELINES

• 5.6 Each government agency shall adopt a uniform property identification system for PPE wherein
a unique Property Number shall be assigned for each PPE item, using the following numbering
system

•0000 – 00 – 00 – 0000 – 00
• Year Purchased
• PPE sub-major account group
• General Ledger Account
• Serial Number (One series per PPE category/type/location)
• Location/Office
The codes for the PPE sub-major account group and General Ledger account correspond to those provided in the Revised Chart of Accounts prescribed under the
Accounting Manuals of the respective Sectors (National, Local and Corporate)

Additional digits may be used for serial number and location/office, as necessary

Schools Division of Toledo City

School Building

Schools Division of Toledo City

 PROPERTY PLANT AND EQUIPMENT (PPE) (Asset Classification)
PPE PPE sub-major account group General Ledger account
Land 10 10

Land Improvements (Other Land Improvements) 29 90

Buildings and Structures (Buildings) 40 10

Buildings and Structures (School Buildings) 40 20

Buildings and Structures (Other Structures) 49 90

Machinery and Equipment (Office Equipment) 50 20

Machinery and Equipment (ICTE) 50 30

Machinery and Equipment (Communication Equipment) 50 70

Machinery and Equipment (Technical & Scientific Equipment) 51 40

Machinery and Equipment (Other Machinery and Equipment) 59 90

Transportation and Equipment (Motor Vehicles) 60 10

Furniture Fixtures and Books (Furniture and Fixtures) 70 10

Furniture Fixtures and Books (Books) 70 20

Other Property Plant and Equipment 89 90

Other Assets 90 10

Printing Equipment 51 20

Schools Division of Toledo City

Sample Types of School Buildings

• 01 - Army Type
• 02 - BLSB Type 1
• 03 - BLSB Type II
• 04 - BLSB Type III
• 05 - Modified SB (7 x 7)
• 06 - DepEd Standard SB
• 07 - DPWH – BOD SB
• 08 - Pre-Fab
• 09 - Gabaldon SB
• 10 - HE Bldg
Schools Division of Toledo City
Location of PPE
OSDS 01 CID 02 SGOD 03 ELEM 04 SEC 05

1 SDS 1 EPSVR 1 Planning and Research 1 Apid ES 1 Awihao NHS

2 ASDS 2 PSDS 2 Social Mobilization 2 Awihao ES 2 Bato NHS

3 Budget and Finance 3 ALS 3 Human Resource Development 3 Bagakay ES 3 Bunga NHS

4 Administrative Office 4 Monitoring and Evaluation 4 Bato ES 4 Cantabaco NHS

5 Records 5 Guidance 5 Biga ES 5 DAS NHS

6 Personnel 6 Youth Formation Development 6 Bulongan ES 6 Gen. Climaco NHS

7 Cash 7 Medical 7 Bunga ES 7 Luray II BHS

8 Supply and Property 8 Buswang ES 8 Magdugo NHS

9 Calibasan ES 9 Matab-ang NHS

10 Calong-calong ES 10 Media Once NHS

11 Cambang-ug ES 11 TCSHS

12 Canlumampao ES 12 TNVS

13 Cantabaco ES

14 Capt. Claudio ES

Schools Division of Toledo

15 Carmen ESCity
Communication Equipment

Schools Division of Toledo City

Sample Types of Communication Equipment

• 01 - Stencil Duplicator
• 02 - Airconditioning Unit
• 03 - Duplicating Machine
• 04 - Television
• 05 - CCTV
• 06 - Projector
• 07 - Camera

Schools Division of Toledo City

Information Communication and Technology Equipment (ICTE)

Schools Division of Toledo City

 Sample Types of Information and Communication and Technology Equipment
(ICTE)

• 01 - DCP Packages
• 02 - Desktop Computer Set
• 03 - Laptop
• 04 - Tablet
• 05 - Printer
• 06 - Scanner
• 07 - Photocopier
• 08 - Computer Accessories

Schools Division of Toledo City

GENERAL GUIDELINES

• 5.7 For easy identification, the Property Number shall be

prominently shown in the Property Sticker, in addition to the
following vital information on the PPE item:
• a. Description of the Property
• b. Model Number
• c. Serial Number
• d. Acquisition Date / Cost
• e. Person Accountable
• f. Space for the validation/signature of the Inventory
Committee
Schools Division of Toledo City
GENERAL GUIDELINES

• 5.8 The Inventory Committee shall be responsible for the actual

count to ascertain the existence, completeness and condition of all
PPEs owned by the government agency
• 5.9 In coordination with the Property Division/Unit, the Inventory
Committee shall plan/strategize on how to conduct and complete
the physical inventory within the prescribed period. It shall prepare
a Physical Inventory Plan (PIP) containing, at the least, the specific
assignment/duties of the Committee members, the cut-off date and
a schedule specifying the dates and locations of the inventory taking
activities from start up to the targeted completion of the physical
inventory

Schools Division of Toledo City

GENERAL GUIDELINES

• 5.10 The PIP shall be approved by the Head of the Agency

• 5.11 The Inventory Committee shall submit the approved PIP to the
COA Audit Team at least ten (10) calendar days before the scheduled
start of the inventory taking activities.

• 5.12 Property records shall be updated based on the results of the

physical inventory and reconciled with accounting records to come up
with the reconciled balances of PPE accounts to be considered as
the correct balance of the agency’s PPEs

Schools Division of Toledo City

Workshop Proper

1. Recognize and identify the PPE based on the latest RPCPPE.

2. Categorize the PPE according to account by adopting a uniform
property identification system for PPE, wherein a unique Property
Number shall be assigned for each PPE item.
3. Present and share screen your presentation. A wheel will be spined
to identify the presenter.
4. Upload your output using this link:

Schools Division of Toledo City

Session Objectives
1. Discuss the general Guidelines and Procedures in the
Conduct of Physical Count of Property, Plant and
Equipment (PPE);
2. Recognition of PPE Items Found at Station and
Disposition for Non-existing/missing PPE Items; and
3. Conduct One-Time Cleansing of PPE Account Balances of
Government Agencies .

Schools Division of Toledo City

 “Do what is right,
not what is easy
nor what is popular”
-Roy T. Bennett

Schools Division of Toledo City

Schools Division of Toledo City