OFFICES RESPONSIBLE FOR LOCAL FISCAL ADMINISTRATION

Local Chief Executives OfficeTreasurer’s OfficeAssessor’s OfficeBudget OfficeAccounting OfficePlanning and Development OfficeThe Sanggunian

The Fiscal Responsibility is shared by all those exercisingauthority over the financial affairs, transactions and operations of the LGU.(Sec. 305, LGC 1991)

What is a Local Budget?

It is the LGUsfinancial plan and instrument for implementing the local development Plan and its investment program

FINANCIAL MANAGEMENT

Budget Officer- Budget Allocation- Budget EstimatesAccountant- Trial Balance- Debt RepaymentTreasurer- Income Statement - Collection Target- Actual Collection- Sample of lease contract- Sources of revenue- Masterlist of stallholders- Frequency of collection- Collection of other fees- Extent of implementation of LRC- Fines and penalties- Incentives

Cont. . . . FISCAL MANAGEMENT

Market Supervisor- Lean and peak months of collection

- System and procedure - Frequency of collection - Mode of remitting

collections- Kinds of reports prepared- average collection of cash

ticket per day- penalties and fines

imposed- Ave. no. of

ambulant/transient vendors per day

- sub-leasing of stallsVendors/stallholders

- awareness of LRC- Kinds of fees paid-lean and peak months

BUDGET PROCESS FOR LOCAL GOVERNMENT UNITS

END

START

BUDGET PREPARATION

BUDGET AUTHORIZATION

BUDGET REVIEW

BUDGET EXECUTION

BUDGET ACCOUNTABILITY

BUDGET PREPARATION

START

BUDGET PLANNING

COST ESTIMATE

EXECUTIVE REVIEW

ENDEXECUTIVE

BUDGET

LOCAL BUDGET SECTORAL CATEGORIES

Economic Services

Social Services

General Public Services

BUDGETARY REQUIREMENTS

• Must not exceed estimates of income Sec.324)

•Full Provisions for Statutory and contractual obligations

•Debt servicing not to exceed 20%•Set aside funds of component brgys not less

than P1000•5% of total income for calamity fund •10% of general fund for SK funds• 20% of IRA for Development projects

(Sec. 287)• Proceeds from share of national wealth

should be appropriated for local devt and livelihood projects. For Hydrothermal, geothermal and other sources of energy, 80% of share be applied to lower the cost of energy.

GENERAL LIMITATIONS ON THE USE OF LOCAL FUNDS

1. Appropriation for PS – 45% =1st –3rd class55%=4th or lower class

2. Salary rate should not be higher than the maximum fixed for the position

3. Should not be appropriated to increase or adjust salaries or wages of NG employees & officials

4. Abolition or Creation of positions must be inaccordance with the provisions of LG Codeand CS rules and regulations

5. Occupied Positions in the official plantilla for career positions must be covered by adequateappropriations

6. Changes in designation or nomenclature ofof positions is allowed, except if vacant, but subject to CS rules and regulations

7. Creation of new position and salary increases or adjustments in no case be retroactive

8. LCE’s Discretionary fund must not exceed 2%of RPT and must be for public purpose

ACCOUNTABILITY FOR PUBLIC FUNDS

Fundamental PrinciplesReceipts and RevenuesGeneral FundSpecial FundSpecial AccountsDepository AccountsSeparation of Personal MoneyLiability of Disbursing OfficersCharges for Services RenderedBond Requirement on Private PartiesIssuance of Official Receipt

DISBURSEMENT OF PUBLIC FUNDS

Limit of DisbursementsDisbursements for Devt. Proj.Cert. by Accountable Officer Cert. Showing AppropriationVoid ContractPersonal LiabilityChecks in Settlement of Obligation

PROHIBITIONS IN SPENDING PUBLIC FUNDS

Approval Of Local Chief Executive (Sec. 344)Election CampaignEntertainment ExpensesCash AdvancesPayment for Services Not RenderedAppropriation for Religious BenefitAppropriation LawTrust Funds

Financial Accountability of Local Officials

COA and LGUs(Constitutional and LG Code Provision)Penal Provision - Local Treasurer or Accountant shall pose the itemized monthly collections and disbursementRevised Penal Code Provisions- Failure of Accountable Officer to render Accounts- Failure of a responsible public officer to render accounts before leaving the countryThe Case of ESC Enterprises( Power of COA to disallow payment

MALVERSATION OF PUBLIC FUNDS

Art 217 of Revised Penal Code

Elements of Malversation:

Offender a public officer

Custody or control of funds or property

Public funds or property

Appropriated, took or misappropriated or consented through abandonment or

negligence, permitted another person to take

Willful Malversation – The Case of Generoso Corpuz

TECHNICAL MALVERSATION

Art. 220 of Revised Penal Code

Element of Technical Malversation

Offender an Accountable public officer

Applied public funds or property to some public use

Public use is different from the purpose of which they were originally appropriated by law or ordinance

PENALTIES FOR MALVERSATION AND TECHNICAL MALVERSATIONMALVERSATION:< P200 –

Imprisonment of not less than 2 yrs, 4 months and 1 day

P201-6000 - not less than 6 yrs and 1 day

P6001-12000 – not less than 10 yrs and 1 day

P12001-22000 -not less than 14 yrs, 8 months and 1 day

> P22000 – not less than 17 yrs , 4 months and 1 day

In all cases – perpetual special disqualification and a fine equal to amt disbursed.

TECHNICALMALVERSATION

Imprisonment of not less than 6 months and 1 day or a fine ranging from ½ to the total value of the sum misappliesTemporary special disqualification5-50% of the sum misapplied if no damage or embarassmentto the public service

OTHER PENALTIESFraud Against Public Treasury

Taking Advantage of Official Position

Failure to Make Delivery of of Public Funds or Property

Frauds Committed by Private Individuals