Samar College Inc.

COLLEGE OF GRADUATE STUDIES

Catbalogan City

DISCUSSANT : Gemma

Ethel

COURSE : MA.ED. – Educational Management

SUBJECT : Financial Planning And Control

TERM : Summer S.Y. 2019

PROFESSOR : Dr. Natalia B. Uy

TOPICS : Auditing Rule

SUB TOPICS : Constitutional and Statutory Safeguards,

Receipt In

General, Acknowledgement Of Collection,

Control Of

Collection, Expenditures and Disbursement,

Disbursement, The Modified Disbursement

System,

Salaries Under Special Circumstances And

Addition or Double Compensation

AUDITING RULE
Auditing - is a systematic process of evaluating
transactions to determine an organization’s compliance
with prescribed policies and procedure.

CONSTITUTIONAL AND STATUTORY SAFEGUARD

 The Philippines Constitution explicitly provides

for an independent Commission on Audit. It is not
appended to the executive, legislative and judicial
branch of the government (Sec. II, Art. IX-A 1987
Const). Its decisions, orders of ruling on cases of
matters brought before it may only be appealed to
the Supreme Court on certiorari (Sec. 7, Art. IX-A
1987 Philippine Constitution).

 The further ensure its dependence; the constitution

provides that the COA shall enjoy fiscal autonomy.

 The declared policy of the state that all

government resources “shall be managed, expanded
and utilized in accordance with law of wastage a
view to ensuring efficiency, economy and
effectiveness in the operations of the government”
mandated to the Commission on Audit to adopt
comprehensive audit. Thru this full scope audit,
the COA can best determine whether or not the
fiscal responsibility that rest directly with the
head of the government agency has been properly and
effectively discharged. (Sec.2, 25(1), PD 1445).

 The commission shall determine whether or not the

fiscal responsibility that rest directly with the
head of the government agency like DECS has been
properly and effectively discharged (Sec.25 (1), PD
1445).
 The DECS Secretary 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 laws and regulations,
and safeguard against loss or wastage to ensure
efficient, economical, and effective operations of
the government (Sec. 2&4(4). PD 1445)

 Any person aggrieved by the decision of an auditor

may, within (6) months from receipts of a copy
thereof, appeal in writing to the commission (Sec.
48, PD 1445). The commission may delegate the
preliminary adjudication of the claim to the COA
Directions.

 The chairman of any commissioners of the

commission, Central Office Directors, Regional
Directors. Auditor or any Government agency, and
other officials or employees of the commission
specially deputized in writing by the chairman
shall, in compliance with the requirement of due
process, have the power to summon the parties to
case brought before the commission for Resolution,
issue subpoena duces tecum, administer oaths,
otherwise take testimony in any investigation or
inquiry on any matter within the jurisdiction of
the commission. (Sec. 40(1). PD 1445)

 The commission shall have the power to punish for

contempt provided for the rules of the court under
the same procedure with the same penalties provided
therein.

 The commission shall have the power, under such

regulations as it may prescribe to authorize and
 enforce the settlement of accounts subsisting
between agencies of the government (Sec. 34, PD
1445).

 When the interest of the government so requires,

the Commission may compromise or release, in whole
or in part, any settled claim or liability to DECS
not exceeding ten thousand pesos (P10,000) arising
out nay matter or case before it or within its
jurisdiction.

 The Constitution Specifically authorizes an

aggrieved party to appeal decision, order or ruling
of the Commission by certiorari, directly to the
Supreme Court within thirty (30) days from receipt
of the Commission’s Final ruling on the case. When
the decision, order of ruling adversely-affects the
interest of DECS, the appeal may be made by the
Department Secretary(Sec.50, PD 1445)

CONTROL OF COLLECTIONS

 Every officer accountable for government funds

shall be liable for all losses resulting from the
unlawful deposit, use an application thereof and
for all losses resulting unlawful deposit, use or
application thereof and for all losses attributed
to negligence in keeping at the same (Sec.105,
PDv1445)
 When loss of government fund occurs while such
funds are or in transit or the loss is caused of
fire, theft, or other casualty or force majeure,
the officer accountable therefore or having custody
thereof shall immediately notify the Commission on
Audit or the Auditor concerned, and within thirty
days or such longer period as the Commission or
auditor may in the particular case allow, shall
 present his application for relief, with the
available supporting evidence, Whenever warranted
by the evident credit for the loss shall be
allowed. An officer who fails to comply with this
requirement shall not be relieved of liability or
allowed credit for any such loss in the settlement
of his account.
 Transfer of government funds from one officer to
another shall, excerpt as allowed by law or
regulations, is made only upon prior direction or
authorization of the Commission on Audit or its
representative.
 When the government funds or properly are
transferred from one accountable officers to his
successors, it shall be done upon properly itemized
invoice or receipt which shall invariably support
the clearance to be issued to the relieved or
outgoing officer.
 At no instance should money in the hands of the
collecting officers to be utilized by the purpose
of in cashing private checks.
 Accountable officials shall keep personal money
separate and distinct from local public funds in
their custody and shall not make any profit out of
public money or otherwise apply the came to any use
not authorized by law or an ordinance.

GENERAL RECEIPT

A General Receipt, often known as just a “Receipt,”

is a document by which one party can evidence that
they received something from another party.

Receipt is most often used in situations of sale,

like a sale of goods or sale of service.
 They can also be used for documents and monetary
transactions generally (such as the fulfillment of
a debt or other obligation) as well as donation.

A receipt is a written acknowledgement that

something or value has been transferred from one
party to another.

In addition to showing ownership, receipts can also

be important for other reason.

Receipts can also be important for tax purposes.

HOW TO USE THIS DOCUMENT

 This document can be used for any type of receipt.

The document is set up to assist to form-filler
with the most common types of receipt:

a. Monetary Receipts

b. Document receipts

c. Goods Receipts

d. Services Receipts

e. Donation Receipts

 If none of these is the correct categorization, the

Receipt also has an option for “other,” whereby the
form –filler can enter the details of the
transaction underlying the receipt.

 Here, the form-filler will enter name and address

information for each party and then choose the type
of Receipt. From there, additional details will be
asked about the transaction to help fill the
receipt out.
  Afterwards, the document should be signed by the
individual accepting receipt- whether it is
accepting receipt of money or documents or goods,
etc. Then ideally, a copy should be kept with both
parties with the original going to the individual
who did not sign it.

EXPENDITURES AND DISBURSEMENT

 Expenditure – acquisition of goods and services

 Disbursement- payment of cash

 Existence of appropriations- “No money shall

be paid out of the Treasury except in
pursuance of an appropriation made by law.”

 Compliance with Laws, Rules and Regulations-

purchase or goods, infrastructure project and
consulting services, including common-use
supplies, shall be in accordance with RA No.
9184 and its IRR and GPPB guidelines issued
thereon.

 Completeness of Documents- claims against

government funds shall be supported with
complete documents. It serves as an evidence
to establish validity of the claim.

 Proper Accounting Treatment- 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.
 Disbursement Process

 APPROPRIATION
 ALLOTMENT
 OBLIGATION/EXPENDITURE
 DISBURESEMENT

 Appropriation - is an authorization made by

law or other legislative enactments of
obligations to be incurred and allowing
payments to be made with funds of the
government under specified conditions and/or
specified purposes.

 Allotment - is an authorization issued by the

DBM to NGAs to incur obligations for specified
amounts contained in a legislative
appropriation in the form of budget release
documents. It is also referred to as
Obligational Authority.

 Obligation/Expenditure - act of a duly

authorized official, which binds the
government to the immediate or eventual
payment of a sum of money.

 a commitment that encompasses possible

future liabilities based on current
contractual agreement.

 Shall be made through the issuance of

Obligation Request and Status (ORS).

 Disbursement – all cash paid out during a

given period at currency (cash) or by
check/Advice to Debit Account (ADA).
 represents the movement of cash from
an AGDB or from the
 Treasurer/authorized disbursing
officer to the final receipt.

DISBURSEMENTS

 Constitute all cash paid out during a given period

either in currency or by check.

 This is the final step of the budget execution

phase where government monies actually spent.

THE BASIC REQUIREMENTS APPLICABLE TO ALL CLASSES OF

DISBURSEMENT ARE:

 Certificate of Availability of Fund. Existence of

lawful appropriation, certified as available by an
accounting officer or any other official required
accomplishing the certificate.

 Use of money appropriated solely for the specific

purpose for which appropriated, and for no other,
except when authorized by law or by a corresponding
appropriating body.

DISBURSEMENT OF GOVERNMENT FUNDS SHALL GOVERN BY THE

FOLLOWING RULES:

 Revenue funds shall not be paid out of any public

treasury or depository except in pursuance of an
appropriation law or other statutory or authority.

 Trust fund shall not be paid out of any public

treasury or depository except in fulfillment of the
purpose for which trust was created or funds
received and upon authorization of the legislative
body or the DECS Secretary having control thereof,
and subject to pertinent budget law, rules and
regulations
  National revenue and trust funds shall not be
withdrawn from the national treasury except upon
warrant or other instruments of withdrawal approved
by the Secretary of Finance as recommended by the
Treasurer of the Philippines.

MODIFIED DISBURSEMENT SYSTEM (MDS)

 The Modified Disbursement Scheme is mostly used,

where disbursements of National Government agencies
chargeable against the Treasury are made through
government servicing banks, such as the Land Bank
of the Philippines.

A. To facilitate the management of cash resources of

the national government, the modified disbursement
System (MDS) was implemented conformably to the
DOF/DBM joint Circular No. 1-90 effective March 1,
1990.

B. Under the National Budget Circular No. 437 dated

January 2, 1995, the DBM shall automatically
release the initial Notice of cash Allocation (NCA)
to cover the first quarter obligation authority
granted to agencies on the basis of authorized
programmed appropriations.

C. A quarterly cash allocation is issued by the

Financial Management Services to the DECS Regional
Offices, thru their respective servicing bank,
equivalent the operational requirements of that
region for the month or for the quarter.

D. All payments should be made by the check chargeable

against the cash allocation.
LOST, DESTROY, AND OBSOLETE CHECKS

A CHECK IS CONSIDERED LOST UNDER THE FOLLOWING

CIRCUMSTANCES:
A. When it is misplaced, waylaid or left
behind inadvertently/ negligently by the
payee or holder in due course, or by the
custodian/carrier thereof, and after
diligent search cannot be found or located.

B. When it is lost due to fortuitous events

such as fire, perils of travels, flood or
typhoon or other causes due to force
majeure and after diligent search, cannot
be found or recovered.

C. When it is lost by theft or robbery.

 A check is considered destroyed when it is torn,

mutilated, or defaced or with erasure affecting
genuineness of any material information contained
therein.

 A check is considered stale six months after date

of issue.

 A check is considered obsolete when it is

use/issuance is no longer authorized.

SALARIES UNDER SPECIAL CIRCUMTANCES

 PRESIDENTIAL DECREE NO. 1177 REVISING THE BUDGET

PROCESS IN ORDER TO INSTITUTIONALIZE THE BUDGETARY
INNOVATIONS OF THE NEW SOCIETY.

 THE DECREE SHALL BE KNOWN AS “BUDGET REFORM DECREE

OF 1977.”
  SECTION 68. SALARY FOR SUBSTITUTIONARY
SERVICE. WHEN AN OFFICIAL OR EMPLOYEE IS
ISSUED A DULY APPROVED APPOINTEMENT IN A
TEMPORARY OR ACTING CAPACITY TO TAKE THE
PLACE AND PERFORM THE DUTIES OF ANOTHER
WHO IS TEMPORARILY ABSENT FROM HIS POST
WITH PAY, SAVINGS IN THE APPROPRIATIONS OF
THE DEPARTMENT, BUREAU OR OFFICE MAY BE
USED FOR THE PAYMENT OF HIS SALARY OR
DIFFERENTIAL, SUBJECT TO THE APPROVAL OF
THE COMMISSIONER.
 Section 69. Prohibition against Payment of
Salaries or wages of Officials and
Employees and Strike against the
Government. Subject to existing civil
service rules and regulations and the
proper administrative proceedings, no part
of the funds of, or available for
expenditures by, any department, office or
agency of the government shall be used to
pay the salaries or wages of any official
or employee engaging in a strike against
the Government of the Republic of the
Philippines, or who is a member of any
organization of government employees that,
in the opinion of the Secretary of
justice, asserts the right to strike
against the government of the Philippines.

ADDITION OR DOUBLE COMPENSATION

 Section 65. Authority to receive

additional compensation. officials and
 employees who are duly appointed by
competent authority to any position in
another government office or agency in a
current capacity, may, in the discretion
of the president, be allowed to receive
additional compensation in the form of
allowance or honorarium at such rates he
shall fix and subject to such conditions
as he may prescribe. such additional
compensation shall be paid from the
appropriations of the office or agency
benefiting from the concurrent service.

 Section 70. Additional compensation for

overtime service. officials and employees
of the national government, when required
to work overtime after regular working
hours during ordinary days, during half-
day sessions, or on Saturdays, Sundays and
holidays, by the heads of department
concerned, to finish work that must be
completed within a specified time, may be
paid compensation from any unexpended
balance of the appropriation for salaries
and wages authorized in the general
appropriations act and under such
guidelines as may be issued by the
president.

 Section 73. Additional compensation for

school faculty members. professors, in
structures, teachers, or members of the
faculty of government schools, colleges
and universities, when required to teach
more than their regular teaching loads may
be paid additional compensation not
exceeding seventy-five per centum of their
basic salary.
  Presidential decree no. 442. As amended
may 1, 1974

 A DECREE INSTITUTING A LABOR CODE THEREBY

REVISING AND CONSOLIDATING LABOR AND SOCIAL
LAWS TO AFFORD PROTECTION TO LABOR, PROMOTE
EMPLOYMENT AND HUMAN RESOURCES DEVELOPMENT AND
INSURE PEACE BASED ON SOCIAL JUSTICE

The decree shall be known as the “Labor Code of the

Philippines.”

 Article 86. Night shift differential.

Every employee shall be paid a night
shift differential of not less than ten
percent (10%) of his regular wage for
each hour of work performed between ten
o’clock in the evening and six o’clock in
the morning.

 Article 87. Overtime work. Work may be

performed beyond (8) hours a day
provided that the employee is paid for
the overtime work an additional
compensation equivalent to his regular
wage plus at least twenty five percent
(25%) thereof. Work performed beyond
eight hours on a holiday or rest day
shall be paid an additional compensation
equivalent to the rate of the first eight
hours on a holiday or rest day plus at
least thirty percent (30%) thereof.

 Article 93. Compensation for rest day,

Sunday or holiday work. Where an employee
is made or permitted to work on his
scheduled rest day, he shall be paid an
additional compensation of at least (30%)
of his regular page. An employee shall be
entitled to such additional compensation
 for work performed on Sunday only when it
is his established rest day.

RESOURCES:

 COMPILATION OF HANDOUTS OF FINANCIAL PLANNING AND

CONTROL S.Y. 2017–2018 AND 2018-2019.