Documenti di Didattica
Documenti di Professioni
Documenti di Cultura
3
Increase competitiveness and the
ease of doing business. This effort will
draw upon successful models used to
attract business to local cities (e.g.,
Davao) and pursue the relaxation of
the Constitutional restrictions on
foreign ownership, except as regards
land ownership, in order to attract
foreign direct investment;
Proposed 10 Point Socio Economic Agenda of President Duterte
1
0
Local Government
Administrative, Financial Local Fiscal Policy
Legal Service Units Operations
and Management Service Service
Service
The Local Treasurer shall take charge of the Local Treasury Office
and perform the following duties and functions:
a) Collect all local taxes, fees and charges directly or through their
duly authorized deputies (Sec. 170, LGC);
b) Advise the Governor or Mayor, as the case may be, the
“sanggunian”, and other local government and national officials
concerned regarding disposition of local government funds, and
on such other matters relative to public finance;
xxx
e) Inspect private commercial and industrial establishments
within the jurisdiction of the local government unit concerned
in relation to the implementation of tax ordinances, pursuant to
the provisions under Book II of the LGC;
k) Specific Functions:
1. Certify as to the Availability of Funds
2. Implement Tax Collection and Enforcement Program
3. Prepare and Submit Reports
4. Certify RPT Delinquencies Remaining Uncollected
5. Examine the Books of Accounts and Pertinent Records
of Businessmen
6. Submit Certified Statement Covering Income and
Expenditures
7. Issue a Certified Statement Covering Actual Income
Powers and Duties of Local Treasurer and Assistant
Treasurer
xxx
k) Specific Functions:
8. Keep full sets of secondary standards for use in the
Testing of Weights and Measures
9. Register in a Book All Branded and Counter Branded
Animals
b) Administrative Supervision-
1. Act on Personnel movement of the local treasurers and
assistant treasurer in terms of promotion, designation,
detail, secondment , transfer, retirement, extension of
service
c) Technical Supervision
1. Supervise and coordinate the conduct of Local Treasury
and Assessment Operations of Provinces, Cities and
Municipalities within the region for the proper
implementation of laws, decrees, rules, regulations and
administrative issuances of the DOF;
CONSTITUTION
LOCAL GOVERNMENT
CODE
LOCAL ORDINANCE
General Principle on Local Finance
Standard formula:
Tax Due = Tax base x Tax rate +
penalty/discounts
Basic Elements of a Tax
INTRODUCTION
CONSTITUTIONAL PROVISIONS
ON ACCOUNTABILITY OF
PUBLIC OFFICERS
2
RESPONSIBILITY, ACCOUNTABILITY AND LIABILITY OF
LOCAL TREASURERS AND OTHER ACCOUNTABLE OFFICERS
INTRODUCTION
CONSTITUTIONAL PROVISIONS
ON ACCOUNTABILITY OF
PUBLIC OFFICERS
ART. XI, Sec. 1. Accountability of Public Officers
INTRODUCTION
CONSTITUTIONAL PROVISIONS
ON ACCOUNTABILITY OF
PUBLIC OFFICERS
4
RESPONSIBILITY, ACCOUNTABILITY AND LIABILITY OF
LOCAL TREASURERS AND OTHER ACCOUNTABLE OFFICERS
INTRODUCTION
CONSTITUTIONAL PROVISIONS ON ACCOUNTABILITY OF
PUBLIC OFFICERS
5
RESPONSIBILITY, ACCOUNTABILITY AND LIABILITY OF
LOCAL TREASURERS AND OTHER ACCOUNTABLE OFFICERS
INTRODUCTION
6
RESPONSIBILITY, ACCOUNTABILITY AND LIABILITY OF
LOCAL TREASURERS AND OTHER ACCOUNTABLE OFFICERS
Responsibility, Accountability and Liability.
– Stephen Covey
7
RESPONSIBILITY, ACCOUNTABILITY AND LIABILITY OF
LOCAL TREASURERS AND OTHER ACCOUNTABLE OFFICERS
Responsibility, Accountability and Liability.
8
RESPONSIBILITY, ACCOUNTABILITY AND LIABILITY OF
LOCAL TREASURERS AND OTHER ACCOUNTABLE OFFICERS
9
RESPONSIBILITY, ACCOUNTABILITY AND LIABILITY OF
LOCAL TREASURERS AND OTHER ACCOUNTABLE OFFICERS
10
RESPONSIBILITY, ACCOUNTABILITY AND LIABILITY OF
LOCAL TREASURERS AND OTHER ACCOUNTABLE OFFICERS
11
RESPONSIBILITY, ACCOUNTABILITY AND LIABILITY OF
LOCAL TREASURERS AND OTHER ACCOUNTABLE OFFICERS
12
RESPONSIBILITY, ACCOUNTABILITY AND LIABILITY OF
LOCAL TREASURERS AND OTHER ACCOUNTABLE OFFICERS
13
RESPONSIBILITY, ACCOUNTABILITY AND LIABILITY OF
LOCAL TREASURERS AND OTHER ACCOUNTABLE OFFICERS
ACCOUNTABLE OFFICERS
– the officer of any government agency whose duties permit or require the
possession or custody of government funds and property (such as the Local
Treasurer, Collecting Officer, Disbursing Officer, Cashier, Paymaster, and
Property Officer), who is required by law to render account to the Commission
on Audit. (LTOM)
– Every officer of any government agency whose duties permit or require the
possession or custody of government funds or property shall be accountable
therefor and for the safekeeping thereof in conformity with law. (P.D. 1445)
15
RESPONSIBILITY, ACCOUNTABILITY AND LIABILITY OF
LOCAL TREASURERS AND OTHER ACCOUNTABLE OFFICERS
16
RESPONSIBILITY, ACCOUNTABILITY AND LIABILITY OF
LOCAL TREASURERS AND OTHER ACCOUNTABLE OFFICERS
17
RESPONSIBILITY, ACCOUNTABILITY AND LIABILITY OF
LOCAL TREASURERS AND OTHER ACCOUNTABLE OFFICERS
Liability for Acts Done Upon Direction of Superior
Officer, or Upon Participation of Other Department
Heads or Officers of Equivalent Rank
18
RESPONSIBILITY, ACCOUNTABILITY AND LIABILITY OF
LOCAL TREASURERS AND OTHER ACCOUNTABLE OFFICERS
Period of Accountability
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RESPONSIBILITY, ACCOUNTABILITY AND LIABILITY OF
LOCAL TREASURERS AND OTHER ACCOUNTABLE OFFICERS
20
RESPONSIBILITY, ACCOUNTABILITY AND LIABILITY OF
LOCAL TREASURERS AND OTHER ACCOUNTABLE OFFICERS
21
RESPONSIBILITY, ACCOUNTABILITY AND LIABILITY OF
LOCAL TREASURERS AND OTHER ACCOUNTABLE OFFICERS
22
RESPONSIBILITY, ACCOUNTABILITY AND LIABILITY OF
LOCAL TREASURERS AND OTHER ACCOUNTABLE OFFICERS
23
RESPONSIBILITY, ACCOUNTABILITY AND LIABILITY OF
LOCAL TREASURERS AND OTHER ACCOUNTABLE OFFICERS
24
RESPONSIBILITY, ACCOUNTABILITY AND LIABILITY OF
LOCAL TREASURERS AND OTHER ACCOUNTABLE OFFICERS
Basic Requirements for
Request for Relief from Accountability
Notice of Loss
Request for Relief from Accountability
Written explanation or reason for delay in filing the notice
of Loss and Request for Relief.
Progress or Final Investigation Report
Affidavit or Sworn Statement of the Treasurer or
Accountable Officer
Affidavit of two disinterested persons who have personal
knowledge of the fact of loss.
Comment and/or recommendation of the LCE/Treasurer
Memorandum Receipt of the property
25
RESPONSIBILITY, ACCOUNTABILITY AND LIABILITY OF
LOCAL TREASURERS AND OTHER ACCOUNTABLE OFFICERS
Basic Requirements for
Request for Relief from Accountability
When to File : Within 30 days from the date of occurrence
of loss
Who shall File: The Accountable Officer
Where to File : COA Auditor of the LGU
What to File : Notice of Loss and Request for Relief from
Accountability (and other requirements)
For other specific occurrences such as Fire, Theft,
Robbery/Hold-up, Force Majeure (Earthquake, Typhoons, etc.)
-- There are other requirements under COA MC 92-751
dated Feb. 24, 1992
26
27
•The Code of Conduct and Ethical Standards for Public Officials and
Employees, declares the policy of the State to promote a high standard
of ethics in the public service.
•Under the Code, every public official and employee shall observe the
declared norms as standards of personal conduct in the discharge and
execution of official duties.
28
ADMINISTRATIVE, CIVIL AND CRIMINAL LIABILITIES OF LOCAL
TREASURERS IN THE ADMINISTRATION OF LOCAL TAXES, FEES
AND CHARGES
Code of Conduct and Ethical Standards of Public
Officials and Employees (Republic Act No. 6713)
29
ADMINISTRATIVE, CIVIL AND CRIMINAL LIABILITIES OF LOCAL
TREASURERS IN THE ADMINISTRATION OF LOCAL TAXES, FEES
AND CHARGES
Code of Conduct and Ethical Standards of Public
Officials and Employees (Republic Act No. 6713)
b. Professionalism
They shall perform and discharge their duties with the highest degree of
excellence, professionalism, intelligence and skill.
They shall enter public service with utmost devotion and dedication to
duty.
30
ADMINISTRATIVE, CIVIL AND CRIMINAL LIABILITIES OF LOCAL
TREASURERS IN THE ADMINISTRATION OF LOCAL TAXES, FEES
AND CHARGES
Code of Conduct and Ethical Standards of Public
Officials and Employees (Republic Act No. 6713)
31
ADMINISTRATIVE, CIVIL AND CRIMINAL LIABILITIES OF LOCAL
TREASURERS IN THE ADMINISTRATION OF LOCAL TAXES, FEES
AND CHARGES
Code of Conduct and Ethical Standards of Public
Officials and Employees (Republic Act No. 6713)
d. Political neutrality
They shall provide service to everyone without unfair discrimination and
regardless of party affiliation or preference.
32
ADMINISTRATIVE, CIVIL AND CRIMINAL LIABILITIES OF LOCAL
TREASURERS IN THE ADMINISTRATION OF LOCAL TAXES, FEES
AND CHARGES
Code of Conduct and Ethical Standards of Public
Officials and Employees (Republic Act No. 6713)
f. Nationalism and patriotism
They shall at all times be loyal to the Republic and to the Filipino people, promote
the use of locally-produced goods, resources and technology and encourage
appreciation and pride of country and people.
They shall endeavor to maintain and defend Philippines sovereignty against
foreign intrusion.
g. Commitment to democracy
They shall commit themselves to the democratic way of life and values, maintain
the principle of public accountability, and manifest by deeds the supremacy of
civilian authority over the military.
They shall at all times uphold the Constitution, and put loyalty to country above
loyalty to persons or party.
33
ADMINISTRATIVE, CIVIL AND CRIMINAL LIABILITIES OF LOCAL
TREASURERS IN THE ADMINISTRATION OF LOCAL TAXES, FEES
AND CHARGES
Code of Conduct and Ethical Standards of Public
Officials and Employees (Republic Act No. 6713)
h. Simple living
They and their family shall lead modest lives appropriate to their positions and
income.
They shall not indulge in extravagant or ostentatious display of wealth in any form.
Basically, modest and simple living means maintaining standard of living within the
public official’s or employee’s visible means of income as correctly disclosed in his
income tax returns, annual statement of assets, liabilities and net worth and other
documents relating to financial and business interest and connections.
34
ADMINISTRATIVE, CIVIL AND CRIMINAL LIABILITIES OF LOCAL
TREASURERS IN THE ADMINISTRATION OF LOCAL TAXES, FEES
AND CHARGES
I. CIVIL LIABILITY
• GENERALLY
35
ADMINISTRATIVE, CIVIL AND CRIMINAL LIABILITIES OF LOCAL
TREASURERS IN THE ADMINISTRATION OF LOCAL TAXES, FEES
AND CHARGES
I. CIVIL LIABILITY
• WHAT IS “GOOD FAITH?”
– It consists of an honest intention to abstain from taking
unconscionable and unscrupulous advantage of another.
• Article 27
– Persons suffering from material or moral loss because
a public servant or employee refuses or neglects,
without just cause, to perform official duty may file for
damages.
• Article 32
– Public officer or employee is liable if directly or
indirectly obstructs, defeats, violates or any manner
impedes the exercise of constitutional rights.
37
LIABILITY ARISING FROM BAD FAITH
• GENERAL RULE
– A public official is not immuned from damages in his
personal capacity for acts done in bad faith. A different
rule would sanction the use of public office as a “tool of
oppression”.
• BAD FAITH
– Not simply bad judgment or negligence;
– Imputes dishonest purpose or some moral obliquity and a
conscious doing of wrong, a breach of sworn duty through
some evil motive or intent or ill-will.
38
ADMINISTRATIVE, CIVIL AND CRIMINAL LIABILITIES OF LOCAL
TREASURERS IN THE ADMINISTRATION OF LOCAL TAXES, FEES
AND CHARGES
I. ADMINISTRATIVE LIABILITY
• CSC Rules;
• Ombudsman Cases;
• BLGF and other Quasi Judicial Cases
• Section 38 and 39, Book I of the
Administrative Code of 1987;
39
Section 38 and 39, Book I of the Administrative
Code of 1987
40
Section 38 and 39, Book I of the Administrative
Code of 1987
41
LIABILITY ARISING FROM ULTRA VIRES ACTS AND
CRIMES
• GENERAL RULE
– Contracts executed within the scope of authority and
in compliance with the rules are valid and binding
upon the State.
• EXCEPTIONS:
-- Public officers are personally liable if:
No authority on the part of the officer;
Did not comply with the mandatory requirements.
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LIABILITY ARISING FROM WRONGFUL
DISBURSEMENT OF FUNDS
NO MONEY SHALL BE DISBURSED UNLESS:
1. Local Budget Officer certifies to the existence of appropriation that has
been legally made for the purpose;
2. Local Accountant has obligated said appropriation;
3. Local Treasurer certifies to the availability of funds for the purpose;
4. Vouchers and payrolls shall be certified to and approved by the head of
the department or office who has administrative control of the fund
concerned, as to validity, propriety, and legality of the claim involved;
5. Approval by the Local Chief Executive
CONSEQUENCES OF BREACH
– Expenditures of government funds or uses of government property in
violation of law or regulation shall be a personal liability of the official or
employee found to be directly responsible therefor[Section 103, Government
Auditing Code]
43
LIABILITY FOR UNEXPLAINED WEALTH
44
Anti-Graft and Corrupt Practices Act
• Section 3(a)
– Persuading and inducing another public official to
violate rules and regulations or an offense in
connection with official duties; OR the public official
allowing himself to be persuaded.
• Section 3(b)
– Directly or indirectly requesting or receiving any gift,
benefit, percentage for himself or another person in
connection with a transaction upon which the official
has to intervene in official capacity
45
Anti-Graft and Corrupt Practices Act
• Section 3(c)
– Directly or indirectly requesting or receiving any gift or
benefit for himself or another for whom the public
officer has secured or will secure any Government
permit or license in consideration of the gift given.
• Section 3(d)
– Acceptance or having a family member accept
employment in a private enterprise which has a
pending official business with him during the
pendency thereof or within one year after
46
Anti-Graft and Corrupt Practices Act
• Section 3(e)
– Causing undue injury to any party, including the
Government, or giving any private party any
unwarranted benefit or preference in the discharge of
official functions through manifest partiality, evident
bad faith or gross inexcusable negligence.
47
Anti-Graft and Corrupt Practices Act
• Section 3(f)
48
Anti-Graft and Corrupt Practices Act
• Section 3(g)
– Entering, on behalf of Government, any contract or
transaction manifestly and grossly disadvantageous to the
same, whether or not the public officer profited or will profit
thereby.
• Section 3(h)
– Directly or indirectly having financial or pecuniary interest
in any business or transaction upon which he intervenes in
official capacity, or in which he is prohibited, by law or the
Constitution, from having any interest.
49
Anti-Graft and Corrupt Practices Act
• Section 3(i)
– Becoming interested, for personal gain, or having material
interest in any transaction requiring the approval of a
board which he is a member and where exercise of
discretion in its approval is required, even if he votes
against the same or does not participate in the action of
the board.
• Section 3(j)
– Knowingly approving or granting any license, permit or
privilege in favor of a person not qualified for or not entitled
to said license or of a mere representative or dummy of
one not qualified.
50
Anti-Graft and Corrupt Practices Act
• Section 3(k)
– Divulging valuable information of a confidential
character acquired by his office or by him on account
of his official position to unauthorized persons, or
releasing such information in advance of its
authorized release date.
51
Anti-Graft and Corrupt Practices Act
• PENALTIES
– Violation of Section 3, 4, 5, and 6 of the Act shall be
punished with an imprisonment of not less than SIX
YEARS and ONE MONTH nor more than FIFTEEN
YEARS;
– Perpetual Disqualification from public office;
– Confiscation of forfeiture in favor of Government of
any prohibited interest and unexplained wealth
manifestly out of proportion to his salary and other
lawful income
52
CRIMINAL LIABILTY
53
CRIMINAL LIABILITY ARISING FROM STATUTES
54
Revised Penal Code
55
Revised Penal Code
56
Shortage, Overage and Malversation
57
Crime of Plunder
58
Presidential Decree No. 46
59
Presidential Decree No. 1445
60
ADMINISTRATIVE, CIVIL AND CRIMINAL LIABILITIES OF LOCAL
TREASURERS IN THE ADMINISTRATION OF LOCAL TAXES, FEES
AND CHARGES
61
ADMINISTRATIVE, CIVIL AND CRIMINAL LIABILITIES OF LOCAL
TREASURERS IN THE ADMINISTRATION OF LOCAL TAXES, FEES
AND CHARGES
62
Always Remember:
63
ADMINISTRATIVE, CIVIL AND CRIMINAL LIABILITIES OF LOCAL
TREASURERS IN THE ADMINISTRATION OF LOCAL TAXES, FEES
AND CHARGES
References
64
REAL PROPERTY TAXATION
HOW?
• Sec. 232 and 233, LGC; and Sec 323, LGC IRR
(paraphrased)
– By way of an ordinance, the sanggunian of a province or a
city or a municipality in within the Metropolitan Manila
Area may levy and fix a uniform rate of an annual ad
valorem tax on real property within their locality.
TAXABLE PROPERTIES
REAL PROPERTY, such as:
• Land
• Building
• Machinery
• Other improvements not specifically exempted
NOTE: Basic Real Property Tax and the Special Levy for the Special Education
cover all of the above properties; while the Special Levy on Idle Lands and
Special Levy on Public Works cover only lands.
ILLUSTRATION 5
The Province of Masbate has a duly enacted
ordinance imposing a special levy on properties
benefited by the construction of a new paved
road. The assessor assessed the subject
properties, including the buildings and the
improvements on the lands subject of the new
ordinance. Is this proper?
ANSWER TO ILLUSTRATION 5
• Sec. 240, Local Government Code
– A province, city, or municipality may impose a
special levy on the lands comprised within its
territorial jurisdiction specially benefited by public
works projects or improvements funded by the
local government unit concerned…
REAL PROPERTY (IMMOVABLE PROPERTIES, SEC.
415, CIVIL CODE)
1. Land, buildings, roads and construction of all kinds adhered to the soil;
2. Trees, plants, and growing fruits, while they are attached to the land or form an integral part of an immovable;
3. Everything attached to an immovable in a fixed manner, in such a way that it cannot be separated therefrom without
breaking the material or deterioration of the object;
4. Statues, reliefs, paintings or other objects for use or ornamentation, placed in buildings or on lands by the owner of the
immovable in such a manner that it reveals the intention to attach them permanently to the tenements;
5. Machinery, receptacles, instruments, or implements intended by the owner of the tenement for an industry or works
which may be carried on in a building or on a piece of land, and which tend directly to meet the needs of the said
industry or works;
6. Animal houses, pigeon-houses, beehives, fishponds or breeding places of similar nature, in case their owner has placed
them or preserves them with the intention to have them permanently attached to the land, and forming a permanent
part of it; the animals in this places are included;
7. Fertilizer actually used on a piece of land;
8. Mines, quarries, and slag dumps, while the matter thereof forms part of the bed, and waters either running or stagnant;
9. Docks and structures which, though floating, are intended by their nature and object to remain at a fixed place on a
river, lake or coast;
10. Contracts for public works, and servitudes and other real rights over immovable property.
Exemptions from Real Property Tax (Sec.
234, LGC)
1. Real property owned by the Republic of the Philippines or any of its political
subdivisions except when the beneficial use thereof has been granted for
consideration or otherwise, to a taxable person;
2. Charitable institutions, churches, parsonages, or convents appurtenant thereto,
mosques, non-profit or religious cemeteries and all lands, buildings, and
improvements actually, directly, and exclusively used for religious, charitable
or educational purposes;
3. All machineries and equipment that are actually, directly, and exclusively used
by local water districts and government-owned or controlled corporations
engaged in the supply and distribution of water and/or generation and
transmission of electric power;
4. All real property owned by duly registered cooperatives as provided for under
RA6938;
5. Machinery and equipment used for pollution control and environment
protection.
CONDONATION OR REDUCTION OF
RPT AND INTEREST
By the Sanggunian upon recommendation of the Local
Disaster Risk Reduction and Management Council, in case
of
• A general failure of crops, or
• Substantial decrease in the price of agricultural or agri-based products,
or
• Calamity in the province, city, or municipality (Sec. 276, LGC)
LGU RATE
PROVINCE Not exceeding 1% of assessed
value
CITY Not exceeding 2% of assessed
value
MUNICIPALITY
Assessed WITHIN
Value – the METRO
fair market Not
value of exceeding 2%multiplied
the property of assessedby the
MANILAlevel (Sec. 199 (h), Local Government
assessment value Code).
Assessment Level – the percentage applied to the fair market value to determine
the taxable value of the property (Sec. 199 (g), Local Government Code)
BASIC REAL PROPERTY TAX FORMULA
Where,
ASSESSED VALUE = FMV x ASSESSMENT LEVEL
ILLUSTRATION 6
• Ana has a farm in Atok, Benguet. The farm
currently has an assessed value of P345,000.00.
The province of Benguet imposes a 1% basic real
property tax rate. How much is the real property
tax due?
• ANSWER:
TAX DUE=ASSESSED VALUE x TAX RATE
= p345,000.00 x 1%
=P3,450.00
SPECIAL EDUCATION TAX (Sec. 235, LGC)
A province or city or municipality within the Metropolitan Manila
Area, may levy and collect an annual tax of one percent (1%) on the
assessed value of real property which shall be in addition to the
basic real property tax. The proceeds thereof shall exclusively accrue
to the Special Education Fund.
RA 5447 created the Special Education Fund for specified activities with
its fund to be derived from additional tax on real property and a certain
portion of the taxes on Virginia-type cigarettes and duties on imported
leaf tobacco.
Sec. 272, Local Government Code
…the proceeds shall be allocated for the operation maintenance of public
schools, construction and repair of school buildings, facilities and
equipment, educational research, purchase of books and periodicals, and
sports development as determined by the Local School Board.
ILLUSTRATION 7
• Ana has a farm in Atok, Benguet. The farm
currently has an assessed value of P345,000.00.
The province of Benguet imposes a 1% basic real
property tax and 1% SEF. How much is the real
property tax due?
• ANSWER:
– TOTAL TAX DUE = BASIC + SEF
= 1%(345,000) + 1%(345,0000
= 3,450 + 3,450
= 6,900.00
ADDITIONAL AD VALOREM ON IDLE
LANDS (Sec. 236, LGC)
A province or city or a municipality within the
Metropolitan Manila Area, may levy an annual
tax on idle lands at the rate not exceeding five
percent (5%)of the assessed value of the
property which shall be in addition to the basic
real property tax.
IDLE LANDS (Sec. 237, LGC)
INCLUDES
a) AGRICULTURAL LANDS
• More than one hectare in area
• Suitable for cultivation, dairying, inland fishery, and other agricultural uses
• One-half remain unutilized or unimproved
EXCLUDES
– Agricultural lands planted to permanent or perennial crops with at least fifty (50) trees to a
hectare
– Lands actually used for grazing purposes
b) Lands, other than agricultural
• Located in a city or municipality
• More than one thousand square meters in area
• One-half of which remain unutilized or unimproved
INCLUDES
– Residential Lots in subdivisions duly approved by proper authorities
IDLE LANDS EXEMPT FROM TAX (Sec. 238,
LGC)
Interest for late 2% of each month on unpaid amount until the delinquent amount is
Payment (Sec. paid provided in case shall the total interest exceed 36 months
255, LGC)
For Advance Discount not exceeding 20 % of the annual tax (Sec. 251, LGC)
Payment
For Prompt Discount not exceeding 10%of annual tax due (Art. 342, IRR of LGC)
Payment
ILLUSTRATION 8
• Ana has a farm in Atok, Benguet. The farm
currently has an assessed value of
P345,000.00. The province of Benguet
imposes a 1% basic real property tax rate. In
2013, she left the country without paying her
current Real Property Tax. She only paid all of
her Real Property tax obligations when she
came back on March 1, 2016. How much
should she pay?
ANSWER TO ILLUSTRATION 8
• BASIC • SEF
DISTRIBUTION DISTRIBUTION
Issuance of
Warrant and Preparation
Advertise Report Sale Issuance of
Written of
Delinquency sale or Sale to final deed of
Notice to Certificate
auction Sanggunian sale
the Assessor of Sale
&ROD
ANSWER: PROTEST
CLAIM FOR REFUND OR CREDIT
www.blgf.gov.ph
Inter-Agency Cooperation
DTI
NCC
LGA
DILG DICT
Private BLGF
Sector DOF
Mandate: Department of Finance
on Revenue Operations of LGUs
(Letter dated 5 August 2002 addressed to Mr. Rodante F. Ramos, AVP & Assistant Controller, PCPPI)
Tax on Business
Sec. 143 (b):
On wholesalers, distributors or dealers in any article of commerce of
whatever kind or nature.
(1st Indorsement dated 17 March 1997 to the OIC City Treasurer, Pasig City)
Tax on Business
Sec. 143 (b): Continuation
On wholesalers, distributors or dealers in any article of commerce of
whatever kind or nature.
If a “car dealer” can show proof that he entered into a dealership agreement with
the producer or manufacturer of a car, he shall be classified as a “dealer”.
(Letter dated 9 December 2003 addressed to Chato & Eleazar Law Office)
Tax on Business
Sec. 143 (b): Continuation
On wholesalers, distributors or dealers in any article of commerce of
whatever kind or nature.
A company that supplies department stores with their products in bulk and issues
the corresponding invoice therefor and deploys sales ladies to man the outlets or
shelves inside the department stores should be classified and taxed as a
"wholesaler" pursuant to Section 143(b) of the LGC.
(Letter dated 17 May 2013 addressed to Atty. Jennifer Sobremonte, Legal Counsel for Morning Bell Corp)
Tax on Business
Sec. 143 (c):
On exporters, and on manufacturers, millers, producers, wholesalers,
distributors, dealers or retailers of essential commodities.
The term exporter shall refer to those who are principally engaged in the business
of exporting goods and merchandise, as well as manufacturers and producers
whose goods or products are both sold domestically and abroad.
The amount of export sales shall be excluded from the total sales and shall be
subject to the rates not exceeding one half (1/2) of the rates prescribed under
pars. (a), (b) and (d) of Article 232 (c), IRR of LGC.
Tax on Business
Sec. 143 (c): Continuation
On exporters, and on manufacturers, millers, producers, wholesalers,
distributors, dealers or retailers of essential commodities.
(1st Indorsement dated 17 March 1997 to the OIC City Treasurer, Pasig City)
Tax on Business
Sec. 143 (e):
On contractors and other independent contractors
(Letter dated 1 August 2005 addressed to Ms. Benita J. Macalagay, VP – Business Division, The Medical City)
Tax on Business
Sec. 143 (h):
On any business, not otherwise specified in the preceding paragraphs
Chevron Phils. Inc. deriving income from the lease of its machinery and equipment
to its gasoline retailers is in full accord of Sec. 143(h) of the LGC.
Letter dated 11 March 2008 addressed to Atty. Ronald V. Bernas, Chevron Phils., Inc.)
DYNAMICS OF BUSINESS TAX and
OTHER LOCAL TAXES
BUSINESS-RELATED TAXING
POWERS OF PROVINCES
Tax on Transfer of Real Property
Ownership (Sec. 135, LGC)
Transaction taxed
•Ownership, lease or operation of theaters, Tax rate Tax base:
cinemas, concert halls, circuses, boxing
stadium, and other places of amusement •Not more than 10% •Gross receipt from admission fees
•Pop, rock, or similar concerts •As amended by RA 9640 (An Act Amending
Sec. 140(A) of the LGC, May 21, 2009)
•Exception to exception (CIR v. SM Prime
Holdings Inc., GR No. 183505, February 26,
2010
Exemption
• Exempt from tax on peddlers imposed by
municipalities
BUSINESS-RELATED TAXING
POWERS OF MUNICIPALITIES
Taxing Powers of Municipalities
Manufacturers, assemblers, repackers, processors, brewers, distillers, rectifiers, and compounders of liquors,
distilled spirits, and wines or manufacturers of any article of commerce of whatever kind or nature. (g)
Wholesalers, distributers, or dealers in any article of commerce of whatever kind or nature. (g)
Exporters, and manufacturers, millers, producers, wholesalers, distributors, dealers or retailers of essential
commodities
•Rice and corn
•Wheat or cassava flour, meat, dairy products, locally manufactured, processed or preserved food, sugar, salt and other agricultural,
marine, and fresh water products, whether in their original state or not
•Cooking oil and cooking gas
•Laundry soaps, detergents, and medicine
•Agricultural implements, equipment, and post-harvest facilities, fertilizers, pesticides, herbicides and other farm inputs
•Poultry feeds and other animal feeds
•School supplies and
•cement
Municipality’s Tax on Business
Retailers
• 400,000 or less Annual Gross Receipt – not exceeding 2% of the GR for the preceding
• More than 400,000 AGR – 1%
Contractors and other independent contractors (g)
BUSINESS-RELATED TAXING
POWERS OF CITIES
BARANGAY IMPOSITIONS
Taxes – on stores or retailers with gross sales or receipts of the
preceding calendar year of ₱50,000 or less in the case of cities and
₱30,000 or less in the case of municipalities.
INCLUDING
• Amount charged for materials supplied with the services
• Deposits or advance payments actually or constructively received during the
taxable quarter for the services performed or to performed for another
person
EXCLUDING
• Discounts, if determinable, at the time of sale
• Sales returns
• Excise tax
• Value added tax
BASIC STEPS IN COMPUTING
BUSINESS TAX
Step 2. Step 3.
Step 1. Classify
Determine gross Determine tax
the business
Receipts due
Peddlers
engaged in •P50.00 per
sale of any
merchandise peddler
or article of
commerce
annually
Apply percentage tax on:
Retailers
MANNER OF PAYMENT
• Annual or in equal quarterly installments
ACCRUAL
• On the 1st day of January
• On the first day of the quarter next following the effectivity of the ordinance (new)
TIME OF PAYMENT
• Within the 1st 20 days of January
• 1st 20 days of the quarter following the effectivity of the ordninance (new)
• For justifiable reasons, the sanggunian may extend the time for payment without surcharges or
penaltiesfor a period not exceeding 6 months
SITUS OF MUNICIPAL TAXATION
Definition of Terms
One line of business does not become exempt because it is conducted together with some
other business for which tax has been paid
When person conducts two or more businesses subject to same rate of imposition, tax shall
be computed on combined total of gross sales or receipts
When person conducts two or more businesses subject to different rates of imposition,
taxable gross sales or receipts of each business are reported independently and tax is
computed on basis of pertinent schedule
Don’t allow business taxpayers to fall
through the cracks because of
administrative inefficiencies.
Requirements for new businesses
• Any person starting or establishing a business
covered by tax ordinance of LGU must first get
Mayor’s permit and pay the fee.
• Exemptions:
-- Diplomatic and consular representatives
-- Transient visitors when their stay in the Philippines
does not exceed three (3) months.
Corporate Police
power power
Distinctions of the 3 types of
non-tax revenues
TYPE PRIMARY PURPOSE BASE OF
IMPOSITION
REGULATORY OR PERMIT FEES regulation or inspection cost of regulation
of business or activities and surveillance
Dog license Inspect whether dog has been Cost of impounding and feeding
fee vaccinated based on size of animal
Permit for Ascertain whether cockpit and Cost of issuing permit and
cockfighting personnel have necessary permits surveillance based on type of
cockfight held
Service fees cover services or
conveniences provided by the LGU
• Guiding principle to setting rates
Pass fees to beneficiaries:
-- at full cost
-- at amounts “commensurate” to services
The fourth copy of the RCD of the Liquidating Officer and the
RCD of Collectors shall be retained by the Liquidating Officer
for safekeeping.
Daily Turnover and Verification of
Collections
5.8 Other information that the BLGF may require in the course
of its evaluation.
Procedures and Controls on Deposit of
Collections with Authorized Depository Banks
2. Idle Funds refer to cash which the local government unit can
freely invest in government securities and/or fixed term
deposits with authorized government depository banks, after
considering provisions for the coverage of regular and
recurring operating expenses like salaries, wages, repairs and
maintenance, inventories and supplies, debt servicing, etc., as
well as programmed disbursements for capital outlays and
other non recurring expenses, within the context of the cash
operating cycle of the local government unit.
Unremitted collections for, and funds set aside for the payment
of obligations to, other entities, government, and private, shall
not form part of the idle funds.(Sec. 22 of COA Circular No. 93-
382-A dated July 3, 1992)
Procedures and Controls on Deposit of Collections
with Authorized Depository Banks
________________________
(Signature Over Printed Name)
________________________
Title
__________________. 20___”
CHAPTER 3
Maintenance
Sec and Use
59. Maintenance and of
Usethe
of Cashbook
the Cashbookby Local
by Local
Treasurers,
Treasurers, Cashiers,
Cashiers, Liquidating
Liquidating Officers,
Officers, Disbursing
Disbursing Officers,
Officers, Collectors
Collectors and Other
and Other Accountable
Accountable Officers
Officers. –
1. Collectors. –
3. Local Treasurer
1.2 The collector shall affix his initial and state the date
of issuance in the cash tickets before issuance;
Checks
• These are serially numbered forms purchased from
the servicing bank for use in the disbursement of
funds.
www.blgf.gov.ph
The Three-Level SEAL Program
To support the attainment of competency requirements for the effective and
efficient discharge of local treasury duties and functions, there shall be
established the three-level competency certification under the SEAL
Program, according to tactical-operational competencies, strategic-
managerial competencies and leading for innovation competencies:
SEAL 3:
SEAL 2: ACLTE
SEAL 1: ICLTE
BCLTE
SEAL 1: Basic Competencies on Local Treasury
Basic or general set of tactical-operational competencies that the Local Treasurer/
Assistant Treasurer possesses to undertake the tasks associated with local treasury
functions:
The SEAL 1 Certification is applicable to all provincial, city and municipal treasurers and
assistant treasurers regardless of LGU income classification.
SEAL 2: Intermediate Competencies on Local Treasury
Focuses on managerial-strategic abilities denoting that the Local Treasurer/
Assistant Treasurer has the competencies to oversee the achievement of the goals
and objectives of the local treasury unit:
a) Sets goals and objectives according to the thrusts and priorities of the
DOF, the BLGF and the local government he/she serves
b) Plans the effective use of resources to achieve the goals and objectives
j) Manages changes
The SEAL 2 Certification is primarily intended for local treasurers and assistant treasurers in
1st, 2nd and 3rd Income Class Provinces, Cities and Municipalities.
SEAL 3: Advance Competencies on Local Treasury
Seeks to guarantee that the Local Treasurer/Assistant Treasurer is able to spearhead
the adoption of innovative and leading-edge approaches to local treasury functions,
with the following core competencies:
a) Assess both internal and external landscape the local treasury and the
general local fiscal and financial management affairs
Agency In-Charge
for the
development and
administration of
the examination
DOF, BLGF, CSC DOF & BLGF
Only available for
Candidate for
Any interested applicant those who were
Certification
certified under SEAL 2
SEAL 1: Basic Competencies on Local Treasury
b) Mobilization of Resources
Principles of Local Taxation
Real Property Tax Collection
Business and Other Local Taxes
Fees and Charges, and Local Economic Enterprises
LGU Credit Financing
d) Advanced Risk Management and Internal Control System for Local Treasury
SEAL 1 SEAL 2
(20%) (25%)
SEAL 3
(30%)
Application of the SEAL Certificate
(b) Effective June 2018, all designations and extension of designations shall only
be issued to SEAL 1 (BCLTE) certified and recommended designees of the local
chief executive (LCE)
(c) In the event of vacancy of the position of Local Treasurer, the Assistant
Treasurer, by rule of succession, whether SEAL 1 (BCLTE) certified or not, shall
automatically assume the duties and functions of a Local Treasurer and an
appropriate designation may be issued, subject to existing Department
regulation
Responsibilities of the BLGF
Provide the necessary support and assistance towards the full
attainment of the goals and the sustainability of the SEAL
Program
From time to time, the BLGF shall:
Issue clarificatory guidelines and Update the criteria for selection
adjustments in the benchmarks and evaluation for appointment
Includes trainings, continuing professional education, among others, in partnership with the
academe, higher education institutions and reputable training institutions and providers.
Administrative Arrangements
REGISTRATION OF APPLICANTS EXAMINATION/ENROLLMENT/REGISTRATION FEES
Borne by the applicant and no fees shall be
Imposition of fees and collection chargeable against the Government fund
shall be in accordance with the
rules and regulations of the No other fees shall be collected unless duly authorized by the
proper authorities.
EXAMINATION
INTRODUCTION
01 o Current Situation
o Definition and Classification of LEEs
02 POLICY FRAMEWORK
PLANNING AND
03 IMPLEMENTING PROCEDURES
FOR PROPOSED / NEW LEEs
IMPLEMENTING PROCEDURES
04 FOR EXISTING LEEs
IN TERMS OF POLICY:
o The local government code has provisions
relating to LEEs
o Inadequate guidelines on how to
implement the law
IN TERMS OF
IMPLEMENTATION:
o Dismal track record of most
LEEs per review by Castel
and Manasan
LOCAL GOVERNMENT UNITS
refers to a political subdivision of a nation or
state which is constituted by law and has
substantial control of local affairs (UP Law
Center)
TYPES OF
1. Public Utilities (PUs)
LEEs
2. Other Economic Enterprises
(OEEs)
LOCAL ECONOMIC ENTERPRISE
PUBLIC UTILITY (PU)
PU is a type of LEE:
o created by the Local Sanggunian
through an ordinance;
o for the purpose of providing an
everyday basic necessity or
service to the public at large;
o which otherwise cannot be provided
adequately by the private sector; and
o Charges fees for the service (Section 17(j), RA
No. 7160)
LOCAL ECONOMIC ENTERPRISES
An OEE is:
o an LGU commercially operated
establishment
o created by the Local Sanggunian
through an ordinance
o for the purpose of improving
production and delivery of marketable
goods or services for specific market
groups.
LOCAL ECONOMIC ENTERPRISES
OTHER ECONOMIC ENTERPRISES
(OEEs)
STEP 7
STEP 1 Present the Proposal for
Evaluate STEP 3 STEP 5 the Establishment of the
whether the LEE to the Sanggunian as
LGU should Assess Potential Present the FS Findings and
Basis for the Enactment
engage in LEE Financing Recommended Financing
of the Ordinance Creating
Sources Source to the LCE
the LEE
STEP 1
Evaluate
whether the
LGU should
engage in LEE
STEP 1: EVALUATE WHETHER THE LGU
SHOULD ENGAGE IN LEE
DECISIONS If:
1. Satisfy the LGU economic and social
objectives as reflected in the
PDPFP/CDP and LDIP and AIP
b
STEP 1: EVALUATE WHETHER THE LGU
SHOULD ENGAGE IN LEE
DECISIONS
If:
1. Satisfy the LGU economic and social
objectives as reflected in the PDPFP/CDP
and LDIP and AIP
2. Fill gaps and services not adequately
provided by private sectors.
STEP 1
Evaluate
whether the
LGU should
engage in LEE
STEP 2
Conduct Feasibility
Study (FS) for
Proposed/New LEE
STEP2: CONDUCT FEASIBILITY STUDY FOR
PROPOSED/NEW LEE
01 02 03 04 05
o Establish the volume of demand o Based on the magnitude and o Establish financial viability o Identify the organizational o List down the necessary
and what the user-beneficiaries nature of the demand for the LEE in terms of adequate funds structure and manpower permits, leases, licenses,
“can” and are “willing” to pay in output, properly align the project flow for the project cost requirements needed to insurance, and other pre-
terms of a combination of “user scope, design, and specifications and the subsequent annual operate the LEE, including operating requirements
fees and charges” and “taxes” (the with the market situation; operating and maintenance positions, qualifications,
2 cost recovery mechanisms for (O&M) costs since there is and job descriptions.
LGU projects and LEEs); o Ensure that the project scope,
adequate cost recovery
design, and specifications have
and sufficient financial
o Identify competing products and no adverse environmental
(economic) incentives for
services as well as potential target impact; and
the LEE.
markets and customers; and
o In cases where there are
o Position the LEE products or potential negative environmental
services against its competitors (or effects, provide for mitigation (or
find a niche for the LEE products or compensation) in the project
services). design and costs.
PROCESS FLOW FOR PROPOSED/NEW LEEs
STEP 1
Evaluate STEP 3
whether the
LGU should Assess Potential
engage in LEE Financing
Sources
STEP 2
Conduct Feasibility
Study (FS) for
Proposed/New LEE
STEP 3: ASSESS POTENTIAL FINANCING
SOURCES
SOURCES OF 2. Borrowings
FINANCING o direct loans from lending institutions
o bond proceeds
3. Foreign and Local Grants
o for “hard” projects - whose results are
capital outlays and other infrastructure
projects whose results are tangible
assets)
o for “soft” projects – whose results are
not tangible, such as capacity building,
systems improvement and the like
4. Capital Income
o derived from sales or use of existing
LGU assets.
STEP 3: ASSESS POTENTIAL FINANCING
SOURCES
STEP 1
Evaluate STEP 3
whether the
LGU should Assess Potential
engage in LEE Financing
Sources
STEP 2 STEP 4
Conduct Feasibility Select
Study (FS) for Financing
Proposed/New LEE Source for
the LEE
STEP 4: SELECT SOURCE OF FINANCING
STEP 1
Evaluate STEP 3 STEP 5
whether the
LGU should Assess Potential Present the FS Findings and
engage in LEE Financing Recommended Financing
Sources Source to the LCE
STEP 2 STEP 4
Conduct Feasibility Select
Study (FS) for Financing
Proposed/New LEE Source for
the LEE
STEP 5: PRESENT THE FS FINDINGS AND
RECOMMENDED FINANCING SOURCE TO THE LCE
STEP 1
Evaluate STEP 3 STEP 5
whether the
LGU should Assess Potential Present the FS Findings and
engage in LEE Financing Recommended Financing
Sources Source to the LCE
STEP 7
STEP 1 Present the Proposal for
Evaluate STEP 3 STEP 5 the Establishment of the
whether the LEE to the Sanggunian as
LGU should Assess Potential Present the FS Findings and
Basis for the Enactment
engage in LEE Financing Recommended Financing
of the Ordinance Creating
Sources Source to the LCE
the LEE
STEP 7
STEP 1 Present the Proposal for
Evaluate STEP 3 STEP 5 the Establishment of the
whether the LEE to the Sanggunian as
LGU should Assess Potential Present the FS Findings and
Basis for the Enactment
engage in LEE Financing Recommended Financing
of the Ordinance Creating
Sources Source to the LCE
the LEE
ACCOUNTING
AUDITING
BUDGETING
REVENUE
GENERATION
PUBLIC REPORTING
ON PUBLIC SECTOR
FINANCIAL
OPERATIONS
DEBT CASH
MANAGEMENT MANAGEMENT
BUDGET
Republic of the Philippines
DEPARTMENT OF BUDGET AND MANAGEMENT
Spending within our means
Empowering citizens
through fiscal transparency,
accountability & participation
POLICY-BASED
empowers citizens
PERFORMANCE-
INFORMED
2
4
BUDGET
EXECUTION 3 BUDGET REVIEW
BUDGET PROCESS
PRE-BUDGET
FOR PROPOSED / NEW
PREPARATION LEEs
ACTIVITIES o The viability of the proposed LEE
should be established through an
FS and BP for the LEE.
o The findings and recommendations
of the FS and BP should support
the budget request of the LEE.
INCLUDE IN THE
BUDGET CALL CONDUCT BUDGET
HEARINGS AND CONSIDER THE AOBs
SPECIFIC GUIDELINES
FOR BUDGET EVALUATE BUDGET OF THE LEEs IN THE
PREPARATION OF LEEs PROPOSALS BUDGET MESSAGE
BUDGET
PREPARATION
The specific guidelines for LEEs in the Budget Call should
include:
o Objectives for the budget year, major thrusts, policy directions and
strategies;
o Major assumptions used in estimating the revenue/income and
expenditures for the budget year;
o Estimated revenue/income and expenditure ceiling per LEE;
o Expected output/results; and
o Budget calendar and budget preparation forms as prescribed in the
BOM.
BUDGET
PREPARATION
PREPARATION OF THE AOB OF LEEs:
o Consistent with LGC Section 31, the LEE head/manager should
prepare the budget proposal for the ensuing fiscal year and submit
the same to the LCE through the Local Budget Officer.
BUDGET
PREPARATION
SPECIAL PURPOSE APPROPRIATIONS UNDER THE
LOCAL EXPENDITURE PROGRAM
PREPARATION OF THE AOB OF LEEs:
o The end-user units of the LEE shall prepare the Procurement Project
Management Plan (PPMP) for its programs, projects and activities, to be
submitted to the Budget Officer to support the LEE budget proposal.
o After the budget proposal has been approved by the LCE, the PPMP, as
adjusted to conform to the LCE-approved budget proposal, shall be
consolidated into a proposed Annual Procurement Plan (APP) of the LEE
for the budget year to support the LEE budget proposal.
BUDGET
PREPARATION
BUDGET HEARINGS AND EVALUATION OF BUDGET PROPOSALS:
o A separate budget hearing may be conducted for the LEE AOB.
o The LFC should initially evaluate the LEE AOB proposal for
consistency with policies and priorities set forth in the budget call
and its alignment with the BP.
o The LFC shall spearhead the conduct of budget hearing to:
• Rationalize the continued existence of the LEE.
• Determine the LEE’s contribution to the development goals of the
LGU as embodied in the CDP, LDIP, and AIP.
• Validate the committed outputs and performance targets.
• Recompute the estimates of COE and CO.
BUDGET
PREPARATION
INCLUSION AND PRESENTATION OF THE AOB OF LEEs IN THE
GENERAL FUND ANNUAL BUDGET:
o The Estimated Receipts of the LEE shall be presented in the
Receipts Program of the LGU, net of the Subsidy from the General
Fund
o The expenditures of the LEE shall be presented in the Expenditure
Program of the LGU, exclusive of the amount corresponding to the
Subsidy from the General Fund.
o The Subsidy to the LEE from the General Fund will be presented
under each LEE.
BUDGET
PREPARATION
GENERAL FUND ANNUAL LEE ANNUAL OPERATING
BUDGET BUDGET
TOTAL 10,050,000
BUDGET
AUTHORIZATION
Secretary to the
Sanggunian Submits
Appropriation
LCE Approves the Ordinance for Review
Appropriation
Sanggunian Ordinance
Enacts the
Appropriation
Ordinance
BUDGET REVIEW
THANK YOU
OTHER REVENUE SOURCES AND
FUND TRANSFERS TO LGUs
• Income tax
• Estate tax and donor’s tax
• Value-added tax
• Other percentage taxes
• Taxes imposed by special laws, such as travel tax.
INCOME FROM OTHER REVENUES (EXTERNAL SOURCES)
Barangays Provinces
20% 23%
Cities
Municipalities 23%
34%
INCOME FROM OTHER REVENUES (EXTERNAL SOURCES)
Land Area
25%
Population
50%
Equal Sharing
25% Cities
23%
Internal Revenue Allotment (IRA).
Section 286 of R.A. 7160 provides that the share of each LGU
in the IRA shall be automatically released without need of
any further action and without lien or holdback
INCOME FROM OTHER REVENUES (EXTERNAL SOURCES)
• Section 287, RA No. 7160, and Article 383 (b), IRR of RA No.
7160 direct LGUs to set aside no less than 20% of their IRA to
fund development projects as identified in the LGUs’
development plans.
The following expense items that are not related to and/or not
connected with the implementation of development projects, programs
and activities shall not be paid out of the 20% development fund:
For budget preparation purposes, the BIR submits to DBM a certification of the
LGU share from NIRT equivalent to 40% of the total annual revenue collection
of the 3rd year preceding the current fiscal year, as reconciled with the BTr.
The DBM programs the equivalent amount of IRA in the National Expenditure
Program. Based on the BIR certification and codal formula, the DBM computes
the individual share of each LGU, and informs the beneficiary LGUs of their
respective IRA shares through a Local Budget Memorandum issued not later
than June 15 of the preceding year for the purpose.
At the beginning of the year, the DBM prepares and releases comprehensively
the corresponding release documents to the Bureau of the Treasury (BTr).
The BTr, in turn, downloads the fund through the issuance of Authority to Debit
Account to the Authorized Government Servicing Banks (AGSBs), which credits
the shares of the beneficiary LGUs to their respective accounts.
INCOME FROM OTHER REVENUES (EXTERNAL SOURCES)
Share in the Proceeds of the Tobacco Excise Tax
(R. A. No. 7171) .
There following are the four (4) types of national wealth with the
corresponding collecting agency:
Particulars Collecting Agency
Forest Charges Department of Environment and
Natural Resources (DENR) – OSEC
Royalties and Mineral Reservation DENR – Mines and Geo-Sciences
Bureau
Energy Production Resources Department of Energy
Mining Taxes Bureau of Internal Revenue
INCOME FROM OTHER REVENUES (EXTERNAL SOURCES)
Provinces
20%
Barangays
35%
Component
City or
Municipality
45%
Distribution of Shares
Barangay
35%
City
65%
INCOME FROM OTHER REVENUES (EXTERNAL SOURCES)
Share in the Proceeds from the Development and Utilization of the
National Wealth
The collecting agencies, i.e., Bureau of Internal Revenue (BIR), the Department
of Environment and Natural Resources (DENR), DENR-Mines and Geosciences
Bureau (MGB), and the Department of Energy submit to DBM a certification of
the projected total shares of LGUs based on the immediately preceding year’s
collections as basis for provision of appropriations cover.
During budget execution, the collecting agencies and the BTr submit to DBM a
reconciled certification on actual collections and actual remittances from the
immediately preceding year.
The BTr, in turn, downloads the fund through the issuance of Authority to Debit
Account to the AGSBs, which credits the shares of the beneficiary LGUs to their
respective accounts.
Other Special Shares of Local Government Units from National
Taxes
Share in Special Economic Zones
For budget preparation purposes, the BIR submits to the DBM on or before
March 15 of every year a certification on the total computed LGU shares based
on the actual revenue collections corresponding to thirty percent (30%) of the
total final tax collected on GIE for the base year, which is two (2) years
immediately preceding the current year.
During budget execution, the BIR and BTr submit reconciled certification/s of
actual collections and remittances to the DBM.
Based on the reconciled certification/s submitted by the BIR and BTr, the DBM
prepares and releases the corresponding release documents to the BTr
The BTr, in turn, downloads the fund through the issuance of Authority to Debit
Account to the AGSBs, which credits the shares of the beneficiary LGUs to their
respective accounts.
Other Special Shares of Local Government Units from National
Taxes
Share from Excess Collection in Value Added Tax (VAT).–(a) In
addition to the Internal Revenue Allotment, fifty percent (50%)
of the national taxes collected by the Bureau of Internal
Revenue (BIR) under Sections 106 and 108 of the National
Internal Revenue Code (NIRC) of 1997 (formerly Sections 100,
101 and 102 of the NIRC of 1977) in excess of the increase in
collection for the immediately preceding year shall be
distributed as follows:
Documentary Requirements
Transfer
Source Agency:
operating expenses
FUND TRANSFERS
Documentary Requirements
Liquidation
Source Agency:
Introduction
Introduction
Introduction
Fund
A sum of money or other resources set aside for the purpose of
carrying out specific activities or attaining certain objectives in
accordance with special regulations, restrictions or limitations, and
constitutes an independent fiscal and accounting entity.
[Sec. 3(1), PD1445; Sec. 2(1), Title I(B), Bk V, 1987 Adm. Code; Sec. 306(h), RA 7160]
Government Funds
Government funds include public moneys of every sort and other
resources pertaining to any agency of the government.
[Sec. 3(2), PD 1445; Sec. 2(2), Title I(B), Bk V, 1987 Adm. Code]
Concept of Funds
2. Special Funds
Profits or income derived from the operation of pubblic utilities and other
economic enterprises, after deductions for the cosdt of improvement, repair
and other related expenses of the public utility or economic enterprise
concerned, shall first be applied for the return of the advances or loans
made therefor. Any excess shall form part of the general fund of the local
government unit concerned (Sec. 313, RA 7160)
Fundamental Principles Governing Utilization of Local Funds
• Depository Accounts
Prohibitions on Disbursements:
• Advance Payments - No money shall be paid on account of any
contract under which no services have been rendered or goods
delivered
• Expenditures for Religious or Private Purposes - No public
money or property shall be appropriated or applied for religious or
private purposes.
• Expenses for Reception and Entertainment - No money
shall be appropriated, used, or paid for entertainment or reception
except to the extent of the representation allowances authorized by law
or for the reception of visiting dignitaries of foreign governments or
foreign missions, or when expressly authorized by the President in
specific cases.
DISBURSEMENT OF LOCAL FUNDS
Basic Requirements for Disbursements from the General Fund and
Special Funds.
Certification in the Disbursement Voucher by the Local Accountant
The Local Treasurer shall release the check only to the payee or his
duly authorized representative. For purposes of releasing checks, the
Local Treasurer shall maintain a Check Register where all checks
issued shall be recorded chronologically and where the claimants shall
be required to acknowledge receipt hereof. (NGAs for LGUs, Sec. 41)
Lost Checks
A check is considered lost under the following circumstances:
When any check is lost, stolen or destroyed, the issuing officer may
issue a replacement check which shall be paid under the regulations of
the Commission on Audit in regard to issuance and payment and upon
execution of a bond to indemnify the issuing agency in such amount
and with such security as the Commission may require.
3. Only payments in small amounts may be made through the petty cash
fund. Replenishment of the petty cash fund shall be equal to the total
amount of expenditures mare therefrom.
• Only permanently appointed officials and employees shall be granted cash advances.
• Only duly appointed or designated disbursing officers may perform disbursing functions.
Officers and employees who are given cash advances for foreign travel need not be
designated as Disbursing Officers.
• Only one disbursing officer shall be assigned/designated for a specific legal purpose.
Additional disbursing officers may be assigned/designated for the same purpose only when
fully justified by the Agency Head.
• The cash advance shall be used solely for the specific legal purpose for which it was granted.
Under no circumstance shall it be used for encashment of checks or for liquidation of a
previous cash advance.
• 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.
GRANTING AND UTILIZATION OF CASH ADVANCES
• The cash advance shall be equal to the net amount of the payroll for a pay
period.
• The cash advance shall not be used for payments of regular expenses, such as rentals,
subscriptions, light and water and the like. Payments out of the cash advance shall be allowed
only for amounts not exceeding P5,000.00 for each transaction, except when a higher amount
is allowed by law and/or specific authority by the Commission on Audit. Splitting the
transactions to avoid exceeding the ceiling shall not be allowed.
- Estimate of expenses
GRANTING AND UTILIZATION OF CASH ADVANCES
• The amount of the cash advance shall be limited to the requirements for two months. Within 5
days after the end of each month, the AO shall submit a Report of Disbursements. Additional
cash advances shall be granted on the basis of the activity budget or the requirements for two
months, whichever is lower.
o Budget for COE of the Agency field office or agency activity in the field.
GRANTING AND UTILIZATION OF CASH ADVANCES
Foreign Travel
• Authority to travel
• Itinerary of travel
• Salaries, Wages, etc. - within 5 days after each 15 day/ end of the month
pay period.
Failure of the AO to liquidate his cash advance within the prescribed period
shall constitute a valid cause for the withholding of his salary.
RULES & REGULATIONS ON THE GRANTING, UTILIZATION & LIQUIDATION
OF CASH ADVANCES
2. The AO shall prepare the Report of Disbursements (using Gen. Form No.
______) in three (3) copies and submit the same with the
vouchers/payrolls and supporting documents to the Accountant. For
payments based on receipts and invoices only, he shall also prepare a
liquidation voucher which shall be submitted with the report and the
supporting documents to the Accountant. He shall ensure that receipt of
the report is properly acknowledged by the Accountant.
3. Within 10 days after receipt of the report and supporting documents for
the AO, the Accountant shall verify the report, record it in the books and
submit the same with all the vouchers/payrolls and supporting
documents to the Auditor.
RULES & REGULATIONS ON THE GRANTING, UTILIZATION & LIQUIDATION
OF CASH ADVANCES
• Salaries, Wages, etc. - Report of disbursements with all duly signed payrolls
and/or vouchers and all pertinent supporting documents, such as daily
time records, approved leaves of absence, etc.
• Petty Operating Expenses
Same requirements as those for salaries, wages, etc. and petty operating
expenses, supra
Canvass of at least three suppliers (Not required if purchase is made while on
official travel)
• Foreign Travel
Itinerary of travel
Certificate of travel completed
Report on trip undertaken
Plane, boat or bus ticket (if included in the cash advance)
Receipts for hotel bills and incidental expenses
RULES & REGULATIONS ON THE GRANTING, UTILIZATION & LIQUIDATION
OF CASH ADVANCES
• The AO shall reconcile the book balance with the cash on hand daily. He
shall foot and close the books at the end of each month. The AO and the
Accountant shall reconcile their books of accounts at least quarterly.
• The cashbooks shall be kept at the Office of the AO and placed inside the
safe or cabinet when not in use. It may be taken from his custody only by
the Auditor or an official duly authorized by the Agency Head, who shall
issue the necessary receipt.
The foregoing documents shall be submitted, together with the application for bond,
to the auditor who shall fix and approve the amount of the bond and shall transmit the
same to the Fidelity Bond Division of the Bureau of the Treasury.
RULES & REGULATIONS ON THE GRANTING, UTILIZATION & LIQUIDATION
OF CASH ADVANCES
Travelling Allowances
• General Guidelines
Travels shall cover only those that are urgent and extremely
necessary, will involve the minimum expenditure and are
beneficial to the agency concerned and/or country.
(EO 298, dated March 23, 2004, as amended)
DISBURSEMENT OF LOCAL FUNDS
Specific Guidelines on the Grant of Cash Advance for
Payroll, Field Operating Expenses and Travel
• Foreign Travel:
2.2.1 Funded by LGU
2.2.2 Funded by the National Government
2.2.3 Funded by a Foreign Institution/Country
2.2.4 Personal Foreign Travel
DISBURSEMENT OF LOCAL FUNDS
Documentary Requirements
• Travelling Expenses
Local Travel
Foreign Travel
Disbursements from the Petty Cash Fund shall be through the Petty
Cash Voucher which shall be signed by the payee to acknowledge
the amount received.
Government Expenditures
Personal Services
Maintenance and Other Operating Expenses
Financial Expenses
• Capital Outlays
IRREGULAR
LEGAL BASIS
UNNECESSARY UNCONSCIONABLE
COA CIRCULAR
NO. 2012-003
EXCESSIVE EXTRAVAGANT
COA CIRCULAR NO. 2012-003
October 29, 2012
Loyalty service award granted to employees that have not rendered the
minimum service of ten years in government
(BCDA vs COA, GR No. 142760), 8/6/02)
Grant of food allowance, rice subsidy and health care allowance, there is
no law authorizing such allowance
(BFAR Employees Union, RO VII vs COA, GR No. 169815, 8/13/08;
Benguet State University vs. COA, GR No. 169637, 6/8/07)
ILLEGAL EXPENDITURES
• Transactions in violation of laws
EXAMPLES:
For widening, repairing & improving sidewalks of a privately owned
subdivision where the land it is situated has not been transferred to
the government by way of donation or acquired by the government
through expropriation (Albon vs Bayani Fernando et al., GR No.
148357, 6/30/06)
EXAMPLES
Continuous repair of vehicles & equipment already considered beyond
economic repair as evidenced by frequent breakdown and non-use after
repair
Hiring of consultants whose functions are redundant to the respective
functions of concerned officials – hiring of procurement consultant,
financial consultant, media consultant
EXCESSIVE EXPENDITURES
EXAMPLES
Grant of exorbitant & unreasonable bonuses, allowances
& fringe benefits to public officials and employees
Live-in seminars in five-star hotels within an
unreasonable period of time
LOCAL FUND MANAGEMENT AND UTILIZATION
• Current Assets – cash and other assets that are not earmarked
for specific purposes other than the payment of a current liability
or a readily marketable investment. (p. 391, Glossary of Terms
for State Auditors)
LOCAL FUND MANAGEMENT AND UTILIZATION
LGU
Name of the province/city
municipality FUND
BALANCE Fund name/code
INSTRUCTIONS
CREDIT
DEBIT The difference between the Debit REFERENCE
The amount DATE
deposited
and Credit columns, with
PARTICULARS
which shall
The amount of collections The be
number of Report of
A. This form shall be
Date
the
based on RCD
of
banksthe source
based
attachedhands
on documents
the
Details
deposit
RCD’s
or
slips.
nature
of the Treasurer
of transactions
equal to the amount of cash collections
in the and deposits
accomplished as follows:
CASH BOOK
LGU
B. The Treasurer shall maintain this record to monitor the cash in
Name of the province/city
treasury balance as of specific date. All transactions for the day
municipality FUND
shall be recorded immediately.
BALANCE Fund name/code
INSTRUCTIONS
The amount
and
CREDIT
DEBIT The difference between the Debit REFERENCE
DATE
deposited
Credit columns,with
PARTICULARS
which shall
The amount of
C. At the endthe collections
of each day, the debit and The be
credit number of Report
shall be ruled of
and
A. This form shall be
Date
based on RCD
of
banksthe source
based on documents
the
Details RCD’s
or nature of transactions
equal to the amount of cash collections
closed. All totals shall
attached be written
deposit slips. legibly
hands of the Treasurer
in the
in ink and and deposits
the balances
accomplished as follows:
shall be carried forward as opening balances of the Cash Book
for the next day.
INSTRUCTIONS
CREDIT
The amount checks issued for the day
DATE PARTICULARS
A. This form shall be
based on the Checks/Bank Advise and
Date of the source
Details
documents
or nature of transactions
withholding taxes/charges and other
charges based on JEV
accomplished as follows:
CASH BOOK
LGU
B.Name
TheofTreasurer shall maintain this record to monitor the cash in
the province/city
bankmunicipality
balance as of specific date. All transactions
BANK ACCOUNT NO. for the FUND
day
be recorded immediately. The bank name and account
shallDEBIT Fund name/code
INSTRUCTIONS
The amount deposited for the day
The amount
CREDIT BALANCE number
based on the RCD’s depositchecks issued
slipsThe
and for thebetween
difference
DATE
day REFERENCE
the Debit
PARTICULARS
C. At based
the end of each day, the debitand
and credit
shallshall
be ofbe
theruled
sourceand
interest income
closed.
A. This form shall be
andonother
withholding
All
the Checks/Bank
and
related Credit
Date of the source
taxes/charges
totals
transactions based on Journal Entryshall
equalbe to
Advise
columns,
Detailsdocuments
and
written
the other
The
which
legibly
amount
number
or nature of transactions
in ink
of Cash in and the balance
document
chargesforward
based onas JEVopening
accomplished
shall be (JEV)
Vouchers carried
for the next day.
as follows: Bank balances of the Cash Book
LGU
Name of the province/city
municipality FUND
DISBURSING OFFICER The fund from
Name of Disbursing Officer which cash advance
DEBIT INSTRUCTIONS
CREDIT
BALANCE
The difference between the Debit
DATE PARTICULARS
REFERENCE was made
The amountTheadvanced
amount by the and
disbursed out
Credit
of the
columns,
cash which
The number
shall beof the Voucher
A. This form shall be
Date of
Disbursing Officer based
Voucher Payroll
onthe
thesource
advances
Details
documents
or nature of transactions
equal to the amount of cash inPayroll
hand of Disbursing Officers
accomplished as follows:
CASH BOOK
LGU
Name of the province/city
B. The Treasurer shall maintain this record to monitor the cashFUND
municipality
advances balance as of specific date. All OFFICER
DISBURSING transactions forThe thefund from
day shall be recorded immediately.Name of Disbursing Officer which cash advance
DEBIT INSTRUCTIONS
CREDIT
BALANCE
The difference between the Debit
DATE PARTICULARS
REFERENCE was made
The amount advanced
The amount by the and
disbursed out
Credit
of the
columns,
cash which
andThe number
shall beof the Voucher
C. AtOfficer
Disbursing the end
Voucher
A. This form shall be
ofofeach
Date
based
closed. Payroll
onthe
theday,Details
source
advances
the debit
documents
or nature credit
of shall be ruled and
transactions
equal to the amount of cash inPayroll
All totals shall hand
be written legiblyOfficers
in ink and the balance
of Disbursing
accomplished
shall be asbalances
carried forward as opening follows:
of the Cash Book
for the next day.
• DILG
Linked eSRE’s Local Government Financial Performance Monitoring
System (LGFPMS) indicators to DILG’s Local Government
Performance Management System (LGPMS)
Electronic Statement of Receipts and Expenditures (eSRE)System
The LGU System allows the Treasurers, Budget Officers and Assessors
to encode data needed in order to generate the SRE and QRRPA reports.
The Central System allows the Treasurers, Budget Officers and Assessors
to submit the encoded data to be reviewed and processed by regional and
central users.
b) DOF Department Order No. 34-2014: Amending Sections 3,8 and 9 of the
Department Order No. 8-2011 dated 11 February 2011
These agencies did not only provide updated and detailed data
promptly, but these were also in digital format that could easily be
analyzed. Best of all, they did not impose any fees for providing
the service.
OTHER
FORMULA: TOTAL OTHER
RECEIPTS
RECEIPTS
(OTHER
INTERNAL TOTAL
REVENUE SHARES FROM INTER-LOCAL EXTRAORDINARY TOTAL
REVENUES Real Property Tax (General LGU NAME (OTHER
GENERAL
GENERAL
INCOME)
ALLOTMENT
(TOTAL)
NATIONAL TAX TRANSFER
COLELCTION
RECEIPTS REVENUE
Fund + SEF) + Tax on Business INCOME) INTEREST
+ Other Taxes + Regulatory Fees INCOME
+ Service/User Charges + ABRA 845,777.68 421,877.68 634,970,609.00 23,110.11 - 25,773,915.42 717,805,726.18
Receipts from Economic
Enterprises + Other Receipts + APAYAO 1,185,681.73 684,800.73 569,265,199.00 29,425.50 3,152,735.38 684,743.58 604,636,631.80
Internal Revenue Allotment +
Other Shares from National Tax
Collection + Inter-Local Transfer
+ Extraordinary Receipts
BENCHMARK: LGU revenue > LGU income class
average
INDICATORS
REVENUE EXAMPLE:
GROWTH
The trend in revenue across time
Total RevenuesYr0
APAYAO 528,350,084.95 604,636,631.80 14%
BENCHMARK:
The average annual % increase in LGU
Annual Population Growth Annual Inflation Rate
revenues > Annual inflation rate + Rate (2014) = 1.82 (2014) = 3.1
Annual population growth rate
Philippine Statistics Authority
INDICATORS
APAYAO
3
3
234,733.00 3,585,629.32 5,315,710.22 2,071,268.62 540,043.06 837,075.70
SEF ABRA 3
43,842,587.05 - 634,970,609.00 23,110.11 50,876,603.75
LSR = Real Property TaxPopulation
(General Fund) + Tax on Business + Other APAYAO 3
Taxes + Regulatory Fees + Service/User Charges + Receipts from 7,517,231.53 8,608,214.79 566,335,997.00 29,425.50 26,537,921.53
Economic Enterprises
BENCHMARK:
Growth in Locally Sourced Revenue per
Capita > average for the LGU income
class to which the LGU belongs
INDICATORS
% LOCALLY SOURCED
REVENUES TO TOTAL EXAMPLE:
% LOCALLY
LGU REVENUE INCOME LOCALLY SOURCED
SOURCED
LGU NAME TOTAL REVENUE REVENUES TO
CLASS REVENUE
The share of revenues that are under LGU TOTAL LGU
control and results from local economic activity REVENUE
ABRA 3 7%
717,805,726.18 50,876,603.75
FORMULA: APAYAO 3
604,636,631.80 26,537,921.53
4%
% ANNUAL EXAMPLE:
REGULAR INCOME LGU NAME
INCOME
CLASS
REAL PROPERTY
TAX (BASIC)
TAX ON
BUSINESS
REGULATORY
OTHER TAXES FEES (PERMITS
SERVICE/USER
CHARGES
RECEIPTS
FROM
ECONOMIC
AND LICENSE)
(ARI) TO TOTAL ABRA 3
ENTERPRISES
98%
593,588,144.76 604,636,631.80
Annual Regular Income x 100 684,800.73 566,335,997.00 29,425.50
Total Revenues
BENCHMARK:
% Share of recurring revenue to total LGU revenue > average share for the LGU income
class to which the LGU belongs
INDICATORS
FORMULA: ABRA
39,878,087.21 8,901,339.54
22%
100
Targeted RPT Collections (GF + SEF)
Actual Real Property Tax Collection = Real Property Tax Collection (GF + SEF)
Targeted Real Property Tax Collection = Real Property Tax Collectibles – Net of Restriction (GF + SEF)
INDICATORS
Population
BENCHMARK:
Per capita total LGU expenditures >
average for the LGU income class to
which the LGU belongs
INDICATORS
FORMULA: APAYAO 3
480,557,892.74 62,568,828.63
13%
FORMULA: APAYAO 3 - -
2,611,796.09 72,794,327.83 27,501,985.64
Social Services Expenditures x 100
Total Expenditures Social Services Expenditures = Education,
Culture & Sports/Manpower Development + SOCIAL
Health, Nutrition & Population Control + Labor INCOME SOCIAL SERVICES TOTAL SERVICES
and Employment + Housing and Community
LGU NAME
CLASS EXPENDITURES EXPENDITURES EXPENDITURE
Development + Social Services and Social
RATIO
Welfare (GF + SEF + TF)
BENCHMARK:
SSER > average for the LGU income class ABRA 3 36%
220,088,290.64 619,885,598.75
to which the LGU belongs and should be
APAYAO 3 21%
increasing 102,908,109.56 480,557,892.74
INDICATORS
FORMULA: APAYAO 3
480,557,892.74 129,727,698.65
27%
BENCHMARK:
ESER > average for the LGU income class
to which the LGU belongs and should be
increasing
INDICATORS
FORMULA: ABRA 3 9%
686,292,200.54 61,589,483.30
Debt Service Payment (GF) x 100
Annual Regular Income Debt Service (GF) = Debt Service (FE)
APAYAO 3
593,588,144.76 62,568,828.63
11%
(Interest Expense & Other Charges)
+ Debt Service (Principal Cost) (GF)
BENCHMARK:
DSR < 20% of annual regular income and
ratio should at least be stable if not
decreasing across time
INDICATORS
(GOSDSR) ABRA 3
17,474,886.86 238,653,995.60 256,128,882.46
The ratio of LGU operating surplus to debt service
APAYAO 3
Gross Operating Surplus/Deficit = Net Operating Surplus =- 12,516,724.26 222,962,920.53 235,479,644.79
Operating Income/ (Loss) From Current Operating Revenues –
Operations + Debt Service (FE) (GF) Operating Expenditures GROSS OPERATING
INCOME SURPLUS (GF) TO DEBT
LGU NAME DEBT SERVICE
CLASS SERVICE RATIO (GF)
FORMULA: (GOSDSR)
Gross Operating Surplus (Deficit) (GF) ABRA 3 416%
61,589,483.30
Debt Service Payment (GF)
APAYAO 3 376%
62,568,828.63
BENCHMARK:
GOSDSR > average for the LGU income class to
which the LGU belongs and should be increasing
INDICATORS
FORMULA:
Total Outstanding Debt x
100
Total Net Assets = Total Assets (Net of
Total Net Assets
Depreciation
BENCHMARK:
DNAR should be < 1 indicating that an
LGU has a sufficient asset base to back
up its debt.
INDICATORS
CAPITAL EXAMPLE:
INVESTMENT
CAPITAL INVESTMENT
CAPITAL/
EXPENDITURES TO LGU NAME
INCOME
CLASS
INVESTMENT TOTAL REVENUE
EXPENDITURES TO
TOTAL REVENUES
EXPENDITURES
TOTAL REVENUES RATIO (CIETRR)
(NOSTRR) ABRA 3
238,653,995.60
717,805,726.18 33%
The ratio of LGU net operating surplus to
total LGU revenues APAYAO 3
222,962,920.53 604,636,631.80 37%
FORMULA:
Net Operating Surplus (Deficit) x 100
Total Revenues Net Operating Surplus/Deficit = Net
Operating Income/(Loss) from
Current Operations
BENCHMARK:
NOSTRR > average for the LGU income class to which
the LGU belongs and should be increasing in case of
operating surpluses and decreasing in case of
operating deficits
INDICATORS
TYPE 3: TYPE 4:
www.blgf.gov.ph
SUMMARY OF RESULT - CAR
LGU NAME 2013 2014
www.blgf.gov.ph
SUMMARY OF RESULT – REGION I
LGU NAME 2013 2014
SAN VICENTE,
TYPE 3 TYPE 4
ILOCOS SUR
NAGBUKEL, ILOCOS
TYPE 3 TYPE 3
SUR
ADAMS, ILOCOS
TYPE 3 TYPE 3
NORTE
STA. CATALINA,
TYPE 4 TYPE 2
ILOCOS SUR
SUGPON, ILOCOS
TYPE 3 TYPE 3
SUR
www.blgf.gov.ph
SUMMARY OF RESULT – REGION I
LGU NAME 2013 2014
LIDLIDDA, ILOCOS
TYPE 3 TYPE 3
SUR
SAN ILDEFONSO,
TYPE 4 TYPE 3
ILOCOS SUR
www.blgf.gov.ph
SUMMARY OF RESULT – REGION II
LGU NAME 2013 2014
REINA MERCEDES,
TYPE 4 TYPE 4
ISABELA
VILLAVERDE, NUEVA
TYPE 4 TYPE 2
VIZCAYA
STA. TERESITA,
TYPE 2 TYPE 1
CAGAYAN
AMBAGUIO, NUEVA
TYPE 4 TYPE 4
VIZCAYA
www.blgf.gov.ph
SUMMARY OF RESULT – REGION II
LGU NAME 2013 2014
SAN GUILLERMO,
TYPE 4 TYPE 4
ISABELA
BASCO, BATANES TYPE 2 TYPE 1
www.blgf.gov.ph
SUMMARY OF RESULT – REGION III
LGU NAME 2013 2014
SANTA MARIA,
TYPE 2 TYPE 2
BULACAN
BUSTOS, BULACAN TYPE 2 TYPE 2
SAN CLEMENTE,
TYPE 2 TYPE 2
TARLAC
MASINLOC,
TYPE 1 TYPE 1
ZAMBALES
www.blgf.gov.ph
SUMMARY OF RESULT – REGION III
LGU NAME 2013 2014
www.blgf.gov.ph
SUMMARY OF RESULT – REGION IV-A
LGU NAME 2013 2014
SAN NICOLAS,
TYPE 2 TYPE 2
BATANGAS
www.blgf.gov.ph
SUMMARY OF RESULT – REGION IV-A
LGU NAME 2013 2014
www.blgf.gov.ph
SUMMARY OF RESULT – REGION IV-B
LGU NAME 2013 2014
LOOC, OCCIDENTAL
TYPE 4 TYPE 4
MINDORO
SANTA MARIA,
TYPE 4 TYPE 4
ROMBLON
www.blgf.gov.ph
SUMMARY OF RESULT – REGION IV-B
LGU NAME 2013 2014
LINAPACAN,
TYPE 4 TYPE 4
PALAWAN
ALCANTARA,
TYPE 4 TYPE 4
ROMBLON
AGUTAYA, PALAWAN TYPE 4 TYPE 4
www.blgf.gov.ph
competence efficiency sustainability
proficiency accountability
work ethic integrity honesty
DOF DEPARTMENT ORDER NO. 06-2015
PERFORMANCE STANDARDS FOR
LOCAL TREASURERS AND
ASSISTANT TREASURERS
March 2017
Objectives
To orient participants about the Performance Standards for
Local Treasurers and Assistant Treasurers
Evaluation Process
This indicator measures the collection of current and delinquent local revenues based on actual collections vis-à-vis
the respective targets in all local revenue areas.
If the LGU is NOT operating a local economic enterprise
Benchmark: 85% Collection of target in each local revenue source
Benchmark scoring by revenue source: ≥100% = 1; ≥95% but <100% = 0.75; ≥90% but <95% = 0.50; ≥85%
but <90% = 0.25; <85% = 0
Formula: Collection Efficiency = (Collection/Target) x 100%
Computation: Formula to be applied per local revenue source; benchmark score to be summed up to get total
score
Data Source: eSRE; QRRPA (for real property tax only)
Weight Distribution (Points)
Revenue Source Province City Municipality
Real Property Tax 16 13 13
Business and Other Taxes 7 17 13
Fees and Charges 12 5 9
Economic Enterprise 0 0 0
Total 35 35 35
OPG 1 Local Collection Efficiency
35 points
Target Parameters
Real Property Tax
RPT Current Year Collection + Prior Year (Basic) + Prior Year Penalty (Basic) +
Collection
Prior Year (SEF) + Prior Year Penalty (SEF)
RPT target to be based on the Quarterly Report on Real Property Assessments, as reported by the
local assessors: 80% of current year collectibles + 35% of cumulative collectible delinquencies up to
the last five (5) years
OPG 1 Local Collection Efficiency
35 points
Target Parameters
Business & Other Taxes
Collection Tax on Business (Current Year) + Other Taxes (Current Year)
Target Tax on Business (Prior Year) + Other taxes (Prior Year) x Incremental Factor
Target Parameters
Economic Enterprise
Collection Income from Economic Enterprise (Current Year)
Incremental Factor: to be based on the GDP and Inflation Rate and other adjustment factors, as may
be determined by the BLGF.
Concurrence of Local Treasurers with the BLGF Targets: Upon issuance of the local revenue
targets, local treasurers may request for adjustment by reason of force majeure, civil disturbance,
natural calamity or any cause or circumstance, which legally prevents the treasurer from enforcing
collection.
OPG 2
Stable and Reliable
Local Revenue Growth
20 points
This indicator measures the efforts in ensuring stable and progressive growth in local revenue collections. Growth
is measured based on the nominal increase in the immediately preceding fiscal year’s collections in all local
revenue areas.
This indicator measures the management of the cash flow for payment of obligations and in optimizing fund
utilization and managing expenditures to ensure that released allotments are adequately covered by available
cash and/or future collections.
This indicator, accounts for the net ending cash balance, together with the total receipts from all fund sources, less
the total expenditures for the current fiscal year.
Benchmark: Fund Balance End > Current Year Expenditures (Net Surplus)
Benchmark scoring: Net Surplus = 1; Net Deficit = 0
Formula: Fund Balance End = (Cash Balance Beginning + [Total Receipts Excluding Loans, Grants & Aids])
– (Total Expenditures - [Debt Service + Disbursement from Grants & Aids])
In case the local treasurer has collected already at least 90% of the total current year collectibles, the full 5
points shall be credited with or without availing of administrative or judicial remedies for RPT collection.
OPG 4
Institution of Administrative and
Judicial Remedies
10 points
This indicator measures the treasurer’s practical use of the available civil remedies for the collection of any
delinquent local tax, fee, charge, or other revenues within the LGU jurisdiction. Under the Local Government
Code, local treasurers are mandated to institute administrative (distraint or levy) and/or judicial actions in aid of
tax collection enforcement.
For the collection of delinquencies in Other Local Taxes:
Benchmark: Issuance of warrant of distraint AND Endorsement to the LGU legal officer for the institution of
civil action
Benchmark scoring:
Warrant/s of distraint issued = 0.5 Endorsement to legal officer = 0.5
AND
No warrant of distraint issued = 0 No endorsement to legal officer = 0
Computation: Score = Benchmark score x 5 points
Remarks: Sum up rating per action; Rating is not dependent on volume of warrants issued or endorsement/s
made to the LGU legal officer.
Data Source: Certified copy of warrant/s of distraint sent to taxpayer AND Certified copy of endorsement of
treasurer to the LGU legal officer
OPG 5
Reportorial Compliance
with DOF requirements
10 points
This indicator measures compliance with reportorial duties and responsibilities, as required by the Department,
namely, the SRE (DOF DOs 08-2011 and 034-2014), the Certified List of Real Property Tax (RPT) Delinquencies
(DOF DO 10-08), the Statement of Indebtedness (DOF LFC 1-2012), and the LGU-BIR Information Sharing (EO
646 and DOF DO 9-08).
Benchmark: Complete and timely submission of reports in all areas
Benchmark scoring:
1. SRE 5
2. Certified List of RPT Delinquencies 3
Complete = 1
3. Statement of Indebtedness (with or without loan/s) 1 Incomplete = 0
This shall be based on any adverse findings of the Commission on Audit (COA) for which the local treasurer or
assistant treasurer is primarily responsible.
Benchmark scoring:
No adverse findings = 1; With adverse findings = 0
Remarks: To be based on the Annual Audit Report (AAR) of COA. Such basis
shall be the AAR immediately preceding the rating period/year or the latest
available AAR of the LGU.
Formula:
Cost to Collect Ratio = (Total Expenditures of Treasurer’s Office/Total Local Revenues) x 100
Total Actual Expenditures = Personal Services (PS) of the Treasurer’s Office + Maintenance and Other
Operating Expenses (MOOE) of the Treasurer’s Office
Total Local Revenues = Tax Revenues + (Non-Tax Revenues – Other Receipts)
Computation: Multiply weight with the benchmark score according to the ratio.
Data Source: eSRE
OPG 7
Cost Effective
Local Revenue Collection
5 points
This indicator measures the ratio of total cost of collection and the actual local revenues collected to determine
the cost effectiveness of the local treasurer and assistant treasurer in local revenue collection. The ratio
determines whether the LGU is subsidizing the cost of collecting the tax, or the tax is contributing to the revenue
coffers of the LGU.
The local treasurer or assistant treasurer concerned may request for adjustment in the expenditures
data used in the evaluation.
Subject to validation and approval by the BLGF, MOOE expenditures may be adjusted to exclude any
or all of:
1.Interest Expenses;
2.Subsidies to NGAs, LGUs, or GOCCs;
3.Insurance Expenses;
4.Fidelity Bond Premiums;
5.Election-related expenditures; and
6.Other expenditures appropriated in the Treasurer’s Office, but were actually used for other LGU
office/s.
COMPETENCY
PERFORMANCE
GOALS (CPGs) - 30%
Indicators and Parameters for Evaluation
CPG 1
Code of Conduct
and Ethical Standards
40 points
This indicator determines the compliance of local treasurers and assistant treasurers with the code of conduct
and ethical standards of public officials and employees pursuant to RA6713.
Full points shall be given if no disciplinary actions/penalties, namely, (i) reprimand, (ii) fine, or (iii) suspension
(final and executory), have been meted by judicial and quasi-judicial bodies for offenses or violations of existing
laws, rules and regulations.
Benchmark: Zero (0) Reprimand; Zero (0) Fine; Zero (0) Suspension
Benchmark scoring:
10 points 10 points 20 points
No Reprimand = 1 No Fine = 1 No Suspension = 1
Reprimanded = 0 Fined =0 Suspended =0
Remarks: To be based on the immediately preceding year’s records.
Computation: Multiply weight (by area of sanction) with the benchmark score; sum up score
per area to get the total score
Data Source: BLGF Central/Regional Offices
CPG 2
Capacity Building
and Professional Development
30 points
This indicator measures the capacity building and continuing professional development activities availed of or
engaged in by local treasurers and assistant treasurers to improve their technical proficiency, competence, and
skills from duly recognized and bona fide organizations.
Training Categories:
(i)Core Trainings or those trainings, seminars, and workshops that are directly related to
fiscal and financial management (may include trainings on budget, procurement,
examination of books of account, local treasury operations, etc.)
Areas/Scope of Award:
(i)LGU awards/recognitions with direct contribution of the treasurer/assistant treasurers
(ii)Awards conferred by government and legitimate private organizations relating to local
treasury performance
(iii)Resource speakership or expert engagement outside the local treasury department;
(iv)Civic commendations, achievements and other honorific conferment;
(v)Individual contribution to research, published works, engagement in special project of
high significance or similar endeavors involving expertise in local treasury operations.
CPG 3
Professional Recognitions
and Achievements
15 points
Computation: Multiply applicable weight (by indicator) with the benchmark score.
Data Source: BLGF Central/Regional Offices
CPG 4
Office Management Tools
and Support Systems
10 points
This indicator measures the adoption of quality management tools and other innovative support system/s that
improve workplace organization, foster efficient records management, improve service delivery to clientele,
enable better customer service experience to taxpayers, maintain orderliness in office affairs and transactions,
among others.
Areas/Scope of Award:
(i)5s office organization method: Sort, Straighten, Shine, Standardize & Sustain
(ii)Manual or computerized records management system
(iii)Integrated information systems
(iv)Quality management certification systems: ISO, TUV, etc.
CPG 4
Office Management Tools
and Support Systems
10 points
Benchmark: One (1) working management tool or support system, such as, but not limited to, those
enumerated above.
Benchmark Scoring:
Indicator Weight Score
Two (2) or more working systems 1 10
One (1) working system 0.75 7.5
No working support system 0 0
Remarks: Evaluation to be based on actual supervisory/ocular visit by the BLGF, in the case of city and
provincial treasurers’ offices (including the lone municipality in Metro Manila), and by certification of the
Provincial Treasurer, in the case of municipal treasurers’ offices.
Computation: Multiply applicable weight (by indicator) with the benchmark score.
Data Source: BLGF Central/Regional Offices/Provincial Treasurers
CPG 5
Use of Non-Traditional Collection
Strategies
5 points
This indicator gives credit to innovative and non-traditional collection enforcement strategies of local treasurers
and assistant treasurers.
Such strategies must be legal and included in the plans and programs of the local treasurer.
Benchmark: One (1) non-traditional collection enforcement strategy, such as, but not limited to the enumerated
strategies.
Benchmark Scoring:
Indicator Weight Score
Three (3) or more working strategies 1 5
Two (2) more working strategies 0.75 3.75
One (1) more working strategy 0.5 2.5
No innovative collection strategies 0 0
Remarks: Evaluation to be based on (i) submitted documentation or any evidence of implementation of such
strategies by the local treasurer/assistant treasurer, (ii) through actual supervisory/ocular visit by the BLGF, in the
case of city and provincial treasurers’ offices (including the municipality in Metro Manila), and (iii) by certification
of the Provincial Treasurer, in the case of municipal treasurers’ offices.
Computation: Multiply applicable weight (per indicator) with the benchmark score.
Data Source: BLGF Central/Regional Offices/Provincial Treasurers
Rating Scheme
Adjectival Rating /
Score Level
Summary of Performance
• The BLGF Central Office shall first release the preliminary data/results of applicable OPG
indicators to all BLGF Regional Offices no later than the end of June every year.
• Local treasurers and assistant treasurers to submit the pertinent documents required in the
OPG and CPG indicators that cannot be generated by the eSRE system.
• Within two (2) months after the release of SRE data, the validation and confirmation of the
results of the evaluation shall be completed for approval by the BLGF.
• The BLGF may delegate only to the Provincial Treasurers the gathering and consolidation of
documents required from municipal treasurers, but it shall be the sole duty of the BLGF to
rate, determine, and discuss the results of the performance of all treasurers and assistant
treasurers.
Performance Evaluation Cycle
STAGE 4
Performance Results Awarding and
Intervention Planning
• The final results of the annual performance evaluation shall be released and issued to all local
treasurers and assistant treasurers, as well as to their respective local chief executives and
other concerned parties, every October.
• The BLGF may award local treasurers and assistant treasurers in recognition of exceptional
performance in their work.
• No other performance awards shall be given/instituted unless they are linked with the
Performance Standards.
• In addition, the BLGF shall ensure that appropriate measures and actions are enforced based
on the results of the performance evaluation, including but not limited to personnel action and
intervention development and planning to address weaknesses and gaps of local treasurers
and assistant treasurers
Personnel Action
• The BLGF shall introduce appropriate capacity building
programs and other remedial interventions based on the
results of the performance evaluation, especially for treasurers
and assistant treasurers who receive “Unsatisfactory” and
“Poor” performance ratings.
• In the event that a local treasurer or assistant treasurer receives
“Poor” rating in two consecutive evaluation periods, the
BLGF shall institute the appropriate administrative sanction
pursuant to the Revised Rules on Administrative Cases in
the Civil Service.
Timeline and Other Activities
• Planned implementation of Performance Standards in June 2015
• Administration of examination for local treasurers and assistant treasurers
• Continuing monitoring of LGU performance through the LGU Fiscal
Sustainability Scorecard
• Publication of LGU performance and key indicators
FY2009
Ano’ng
FY2010 Iskor ng
FY2011 ‘yong
Bayan?
FY2012
LGU FISCAL SUSTAINABILITY SCORECARD
Financial Management Performance
Review for Local Government Units
Declining, <1%
locally sourced
income to GDP
0.91%
0.89%
0.86%
0.80%
P
Maximum Score 60
Financial Indicators
KRA 1. Revenue Generation Capacity
P
Mean - 25% Needs Improvement 4
Mean - 50% Poor 2
Maximum Score 10
Financial Indicators
KRA 1. Revenue Generation Capacity
Maximum Score 10
Maximum Score 10
<10% Low 5
Maximum Score 5
Maximum Score 4
7 out of 10 Treasurers
Did Not Submit SRE on Time
Non-Financial Indicators
KRA 5. SMV Updating
Maximum Score 3
Submission of
Incomplete according to form Non-Compliant 1.5
Timely and
Accurate QRRPA
Maximum Score 3
Quantitative 90
All revenue and expenditure indicators are strong; full compliance with
>=80 A Excellent reportorial requirements
Most of the revenue and expenditure indicators are met very satisfactorily;
>=70 but <80 B Very Good high compliance with reportorial requirements
All revenue and expenditure indicators are way below the benchmarks; key
<40 F Poor reportorial requirements are incomplete/not submitted and/or require
further validation
Sample Preliminary Scorecard
xxx
Sample Preliminary Scorecard
Summary Result : LGU FSS
SUMMARY OF RESULT - CAR
LGU NAME 2010 2011 2012
NEEDS
TAYUM, ABRA NEEDS IMPROVEMENT AVERAGE
IMPROVEMENT
NEEDS NEEDS
LUBA, ABRA AVERAGE
IMPROVEMENT IMPROVEMENT
NEEDS
LACUB, ABRA AVERAGE NEEDS IMPROVEMENT
IMPROVEMENT
SUMMARY OF RESULT - CAR
LGU NAME 2010 2011 2012
NEEDS
TUBLAY, BENGUET GOOD VERY GOOD
IMPROVEMENT
NEEDS
BUCAY, ABRA GOOD AVERAGE
IMPROVEMENT
NEEDS
SAN QUINTIN, ABRA POOR GOOD
IMPROVEMENT
SUMMARY OF RESULT – REGION I
LGU NAME 2010 2011 2012
NEEDS
NAGBUKEL, ILOCOS SUR NEEDS IMPROVEMENT VERY GOOD
IMPROVEMENT
NEEDS NEEDS
STA. CATALINA, ILOCOS SUR POOR
IMPROVEMENT IMPROVEMENT
NEEDS
SUGPON, ILOCOS SUR AVERAGE AVERAGE
IMPROVEMENT
SUMMARY OF RESULT – REGION I
LGU NAME 2010 2011 2012
NEEDS
LIDLIDDA, ILOCOS SUR GOOD VERY GOOD
IMPROVEMENT
NEEDS
SAN ILDEFONSO, ILOCOS SUR NEEDS IMPROVEMENT AVERAGE
IMPROVEMENT
SUMMARY OF RESULT – REGION II
LGU NAME 2010 2011 2012
NEEDS
UYUGAN , BATANES AVERAGE GOOD
IMPROVEMENT
NEEDS NEEDS
SAN CLEMENTE, TARLAC GOOD
IMPROVEMENT IMPROVEMENT
NEEDS
BALETE, BATANGAS GOOD POOR
IMPROVEMENT
NEEDS NEEDS
SAN NICOLAS, BATANGAS VERY GOOD
IMPROVEMENT IMPROVEMENT
NEEDS
SANTA MARIA, ROMBLON AVERAGE NEEDS IMPROVEMENT
IMPROVEMENT
SUMMARY OF RESULT – REGION IV-B
LGU NAME 2010 2011 2012
NEEDS
LINAPACAN, PALAWAN POOR POOR
IMPROVEMENT
Understanding LGU
Credit Financing and
Debt Management
30 March 2017 | Extremeli Suites, Parañaque, Metro Manila
Legal Framework of Credit Financing
DILG Guidelines for the Implementation of PPP for the People Initiative
for Local Governments (LGU P4)(DILG Memorandum Circular No. 2016-
120)
• Build-and-Transfer (BT);
• Build-Lease-and-Transfer (BLT);
• Build-Operate-and-Transfer (BOT);
• Build-Own-and-Operate (BOO);
• Build-Transfer-and-Operate (BTO);
• Contract-Add-and-Operate (CAO);
• Develop-Operate-and-Transfer (DOT);
• Rehabilitate-Operate-and-Transfer (ROT);
• Rehabilitate-Own-and-Operate (ROO);
• Rehabilitate-Lease-and-Transfer (RLT);
• Rehabilitate-and-Transfer (RT);
PUBLIC-PRIVATE PARTNERSHIP
(cont’)
• Rehabilitate-Transfer-and-Operate (RTO);
• Concession;
• Joint Venture (JV);
• Lease or Affermage;
• Management Contract using LGU funds;
• Management Contract without using LGU funds;
• Service Contract using LGU funds;
• Service Contract without using LGU funds;
• Divestment or Disposition;
• Corporatizations;
• Incorporation of a Subsidiary with private sector equity;
• Onerous Donations;
• Gratuitous Donations; and
• Any other modality akin to any of the above, or features thereof, that
falls under the definition of a PPP.
DOF Policies on LGU Loan Certification
No
Record receipt of Loan Proceeds Receive LGU Post Borrowing Receive LGU Post Borrowing
and prepare borrowing reports for Release of Loan Report Report
submission to BLGF-RO and BSP
Reporting Requirements of
Statement of Indebtedness,
Payments, and Balances
(SIPB)
BLGF POLICY ISSUANCE
Income
LGU Name Loan Purpose
Class
To finance the construction of a Multi-
Peñarrubia, Abra 6th
Purpose Building
For the landscaping, site improvement,
lighting-solar and for the improvement of
Danglas, Abra 5th
Maramoy and Malibcong/Abaquid Farm to
Market Road
Issued Certificate of Net Debt Service Ceiling
and Borrowing Capacity for Fiscal Year 2015:
Region I
Income
LGU Name Loan Purpose
Class
For the ff. Projects: 1) To reimburse the
development projects for the development
of the LGUs acquired property into a
market, slaughterhouse and commercial
San Ildefonso, Ilocos Sur 5th center 2) To partly finance other
development projects 3) To absorb loans
payable to LBP or outstanding balance as
of implementation date, whichever is
lower
Issued Certificate of Net Debt Service Ceiling
and Borrowing Capacity for Fiscal Year 2015:
Region II
Income
LGU Name Loan Purpose
Class
To finance the acquisition of the ff. heavy
equipment: 1) 2 units Backhoe 2) 1 unit
Ambaguio, Nueva
5th Grader 3) 1 unit Road Roller 4) 1 unit 6-
Vizcaya
Wheeler Forward Dump Truck and 5) 1
unit 6-Wheeler Forward Transit Mixer
To purchase two (2) units dump truck and
Luna, Isabela 5th
one (1) unit pay loader
Issued Certificate of Net Debt Service Ceiling
and Borrowing Capacity for Fiscal Year 2015:
Region III
Income
LGU Name Loan Purpose
Class
Nampicuan, Nueva Ecija 5th For the const./rehab. Of the Public Market
Issued Certificate of Net Debt Service Ceiling
and Borrowing Capacity for Fiscal Year 2015:
Region IV-A
Income
LGU Name Loan Purpose
Class
For the construction of Mamala-Taquico-
Caldong Farm-to-Market Road Sub-
Sampaloc, Quezon 5th
Project under Philippine Rural
Development Project
Fiscal Year 2016
Issued Certificate of Net Debt Service Ceiling
and Borrowing Capacity for Fiscal Year 2016:
CAR
Income
LGU Name Loan Purpose
Class
Income
LGU Name Loan Purpose
Class
For the construction/rehabilitation of
Nampicuan, Nueva Ecija 5th public market of Nampicuan, including the
market stalls
Issued Certificate of Net Debt Service Ceiling
and Borrowing Capacity for Fiscal Year 2016:
Region IV-A
Income
LGU Name Loan Purpose
Class
For the acquisition of two (2) units Dump
Truck, Rehabilitation and expansion of
existing Water System; and Construction
Sampaloc, Quezon 5th
of Mamala-Taquico-Caldong farm-to-
market road sub-project under Philippine
Rural Development Project (PRDP)
To finance the ff. projects: 1) Purchase of
Lot 2) Construction of Public Market and
Balete, Batangas 5th
3) Development of New Municipal Urban
Center