SIMPLIFIED ACCOUNTING SIMPLIFIED ACCOUNTING for SCHOOL HEADS OF for SCHOOL HEADS OF NON-IMPLEMENTING NON-IMPLEMENTING

UNITS/SCHOOLSUNITS/SCHOOLS

SIMPLIFIED ACCOUNTING SIMPLIFIED ACCOUNTING for SCHOOL HEADS OF for SCHOOL HEADS OF NON-IMPLEMENTING NON-IMPLEMENTING

UNITS/SCHOOLSUNITS/SCHOOLS

RATIONALE

• Division Offices and other sources of funds are unable to provide funds to non-implementing units/schools due to absence of specific guidelines and procedures in the receipt, utilization, recording and accounting for such funds.

PURPOSE

a. For use of school heads of non-implementing units/schools to record, account for and liquidate cash advance and other cash transfers by the division offices and other sources using the simplified accounting procedures

b.Assist the accountable officer in the preparation of liquidation reports, which will facilitate the recording of disbursements in the division office’ books of accounts.

COURSE OUTLINEI. Introduction

• Definition• Scope

II. Government AccountingIII. L A R G EIV. DocumentationV. Simple BookkeepingVI. Liquidation ReportVII. Users of Report

INTRODUCTION

ACCOUNTING• Definition 1 –

– is a service activity. Its function is to provide quantitative information, primarily financial in nature, about economic entities, that is intended to useful in making economic decision.

– Accounting Standards Council

ACCOUNTING

Definition 2 –

-- Accounting is the art of recording, classifying and summarizing in a significant manner and in terms of money, transactions and events which are in part at least of a financial character and interpreting the results thereof.Committee on Accounting Terminology of the AICPA

ACCOUNTINGDefinition 3 –

Accounting is the process of identifying, measuring and communicating economic information to permit informed judgment and decision by users of the information.

American Accounting Association in its Statement of Basic Accounting Theory

SCOPE OF ACTIVITIES

•IDENTIFYING•MEASURING•COMMUNICATING

SCOPE OF ACTIVITIES

•Identifying means the recognition or non-recognition of “accountable” events/ transactions

SCOPE OF ACTIVITIES

•Measuring means determining the monetary amounts at which the elements of the financial statements are to be recognized and carried in the balance sheet and income statement.

•Philippine Peso is the unit of measurement.

SCOPE OF ACTIVITIES

•Communicating is the process preparing and distributing accounting reports to potential users of accounting reports.

• Implicit in the communication process are the recording, classifying and summarizing aspects of accounting

SCOPE OF ACTIVITIES

•Recording is the process of systematically maintaining a record of all economic transactions after they have been identified and measured.

SCOPE OF ACTIVITIES

•Classifying is the sorting or grouping of similar and interrelated transactions into their respective class or object of expenditure.

SCOPE OF ACTIVITIES

•Summarizing is the preparation of financial reports.

GOVERNMENT

ACCOUNTING

GOVERNMENT ACCOUNTING

- encompasses the process of analyzing, classifying, summarizing and communicating all transaction involving the receipt and disposition of government funds and property, and interpreting the results thereof.

GOVERNMENT ACCOUNTING

The focus of government accounting is the custody and administration of public funds.Authorized amount Authorized personHow, what, where, and when

to use the funds in custody

Laws, and Rules in

Government

Expenditures

•PD 1445•COA-GAFMIS Circulars•DBM (Budget) Circulars•DepEd-DBM Joint Circular

#2004-01•DepEd Order 19 s. 2008

–Downloading of MOOE

COA-GAFMIS Circulars90-331 dtd May 3, 1990 – rules

and regulations on the granting, utilization and liquidation of Cash Advances

97-002 dtd Feb. 10, 1997 – restatement with amendments on the rules and regulations on the granting, utilization of cash advance

COA CIR #97-002 dtd Feb 10, 1997

General Guidelines:

1. NO CASH ADVANCE shall be given unless for a legally specific purpose.

2. NO ADDITIONAL cash advances shall be allowed to any official or employee unless the previous cash advance given to him is first settled or a proper accounting thereof is made.

COA CIR #97-002 dtd Feb 10, 1997

3. A cash advance shall be REPORTED on as soon as the purpose for which it was given has been served.

4. Only PERMANENTLY APPOINTED OFFICIALS shall be designated as disbursing officers. . . .

COA CIR #97-002 dtd Feb 10, 1997

5. Only duly appointed or designated disbursing officers may PERFORM disbursing functions. . . .

6. TRANSFER of cash advance from one accountable Officer to another shall not be allowed

7. The Cash advance shall be used solely for the specific legal purpose for which it was granted.

COA CIR #97-002 dtd Feb 10, 1997

8. Under no circumstance shall be it be used for encashment of checks or for liquidation of a previous cash advance.

9. The accountant shall obligate all cash advances granted. He shall see that cash advances for a particular year are not used to pay expenses of other years.

COA CIR #97-002 dtd Feb 10, 1997

Bonding Requirement:1. Appointment and/or designation

as accountable officer2. Written character references by

at least three officials of the agency, one of whom is the administrative and/or legal officer, other than the official who appointed/designated him

COA CIR #97-002 dtd Feb 10, 1997

Bonding Requirement

3.Statement of Assets and Liabilities as of the end of the preceding year. The foregoing documents

shall be submitted, together with the application for bond to the fidelity bond division of the Bureau of the Treasury.

COA-GAFMIS Circulars2006-005 dtd July 13, 2006 –

amendment to the rules and regulations on the granting, utilization and liquidation of cash advances

P5,000. and less, cash accountability, AO need not be bonded

Bonding of Accountable Officers

• Sec. 101, PD 1445; • Sec. 305 (f) RA 7160

– Every officer of any government agency whose duties permit or require the possession or custody of government funds or property shall be accountable therefore and for safekeeping thereof in conformity with law and shall be properly bonded in accordance with law.

COA-GAFMIS Circulars2003-006 dtd Dec. 2,2003 – use of

simplified accounting forms Cash Receipts Registry Petty Cash Register Cash in Bank Register

2004-003 dtd June 24, 2004 – supplemental form prescribed under COA Circular No.2003-006 dtd Dec. 2, 2003

Cash Disbursements Register

DepEd-DBM Joint Circular 2004-1

•Sec. ___ authorizes the grant of cash advance to School Heads of non-Implementing Units/schools for the current operating expenses of the school.

DepEd Order 19 dtd ____2008

• The Secretary of Education, Jesli Lapus, orders the downloading of MOOE to schools without complete financial staff, to both elementary and secondary schools.

GAAMPROVISIONS ON FISCAL

MANAGEMENT

AUDITING, Sec. 6 par. 1

• Auditing is an integral part of the accountability process in government.– Ensures sound and prudent financial

management by monitoring and evaluating the spending activities of the government agencies to keep them within the bounds of law and regulations, and the standards of economy, efficiency and effectiveness.

ACCOUNTABILITY, Sec 6 par 2

• The concept of accountability is an integral whole, and fiscal accountability is part of, not apart from, the larger accountability of government and government officials to the people. All public officers and employees are accountable to the people for their overt acts, neglects or omissions while in government service

Fiscal Responsibility, (Secs 2 & 4(4), PD 1445)

• The head of an agency and all those who exercise authority over the financial affairs, transactions, and operations of the agency, shall take care of the management and utilization of government resources in accordance with law and regulations, and safeguard against loss or wastage to ensure efficient, economical and effective operations of the government

Transfer of government funds from officer to another

• Sec. 77, PD 1445– When government funds or property

are transferred from accountable officer to another, or from an outgoing officer to his successor, it shall be done upon properly itemized invoice and receipt which shall be invariably support the clearance to be issued to the relieved or out going officer

Fundamental Principles on Gov’t Expenditure and

Disbursement• Sec 138, GAAM (Sec. 4, PD 1445)

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.

Fundamental Principles

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 specific for which the trust was created of the funds received.

Fundamental Principles

d) Fiscal responsibility shall, to the greatest extent, be shared by all those exercising authority over the financial affairs, transactions, and operations of the government agency.

Fundamental Principles

e) Disbursement 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 completed documentation.

Fundamental Principles

g) All laws, and regulations applicable to financial transactions shall be faithfully adhered to

Fundamental Principles

h) Generally accepted principles and practices of accounting as well as sound management and fiscal administration shall be observed, provided that they do not contravene existing laws and regulations

DOCUMENTATION

DOCUMENTATION

A.Purchase of Supplies Requisition Issue Slip Abstract of Canvass, Price

Quotation of at least 3 suppliers Purchase Order Sales Invoice, or Official Receipt Inspection and Acceptance Report

DOCUMENTATION

B.Traveling Expenses Travel Order or Authority to Travel Certificate of Appearance Fare tickets (Bus, plane, taxi, etc) Itinerary of Travel (Appendix A) Certificate of Travel Completed

(Appendix B) Travel Report – narrative

All in original copies

DOCUMENTATION

C.Training & Scholarship Expenses All that are required of the

Traveling Expenses, plus the following:

Official Receipt of the Registration fee payment

Certificate of Participation (xerox copy only)

DOCUMENTATION

D.Payment of Utility Bills (water, electric, telephone, etc.)

Statement of Account or Billing from the utility company

Official Receipt

SIMPLIFIED BOOKKEEPING

SIMPLIFIED ACCOUNTING

•CASH DISBURSEMENT REGISTER to be accomplish in duplicate

– Date– Particulars– Amount Received– Amount Disbursed– Amount on hand or in bank– Breakdown of Expenditures

LIQUIDATION REPORT

LIQUIDATION REPORT

• Accomplish Liquidation Report form• Attachments:

–Certified photocopy of the Cash Disbursement Register

–Disbursement Vouchers and supporting documents of every expenditures incurred and paid

LIQUIDATION REPORT

–Duplicate (second) copy of check issued if working fund received was deposited in a GSB and checks were issued to pay expenditures

LIQUIDATION REPORT

•Submit to Division Accountant –On a regular monthly basis, or as soon as working fund is on a critical balance, whichever comes first.

LIQUIDATION REPORT

PURPOSE:

Relieve the Accountable Officer (School Head) of his/her money accountability

New or additional working fund can be granted

REPORT USERS• Members of the school community• Division Office• Regional Office• DepEd Central Office• DBM• COA• Local Government Units• Congress, Senate

•THANK YOU