Revised

CASH EXAMINATION
Manual

Republic of the Philipines

COMMISSION ON AUDIT
Commonwealth Avenue, Quezon City

JULY 0 9 2013

COMMISSION ON AUDIT MEMORANDUM NO.

2013-004
TO _______ : All Assistant Commissioners, Directors,
Supervising Auditors, Audit Team Leaders and
All ___________ Others Concerned

SUBJECT-_ : Prescribing the use of the Revised Cash

Examination Manual

A. RATIONALE

Over the past two decades, significant changes

have emerged in accounting and auditing arena
that saw the ·adoption of new international
standards and best practices, and the introduction
of new audit approaches. These developments
necessitated the updating of the Commission's
policies, standards and rules to keep abreast with
the current nonn. An activity that continues to be
so vital in ensuring that cash is adequat3ly
protected and controls are in place is the
examination of the cash and accounts of all
accountable officers of the government. With
almost three decades going after its last revision
the old manual on cash examination deserves a
fresh refinement to keep it relevant and more
responsive to the changing times. The Revised
 Cash Examination Manual embodies the much
needed enhancement to effectively carry out the
eash examination across all sectors of the
government.

B. COVERAGE

The manual shall be used by all audit teams in the

national, local and corporate government
agencies. It shall also be used by special audit
teams from. other offices of the Commission duly
co:nstituted to conduct cash examinations or are
required to perform the same in relation to the
conduct of a special audit. Cognizant of the
peculiarity of operations 'among government
agencies, the· audit teams are encOuraged to
devise and supplement the manual with other
appropriate p~ocedures and techniques designed
to fully achieve the objectives of cash
examination.

C. AUTHORITY TO CONDUCT CASH

EXAMINATION

The authority to conduct regular cash

examination shall be inherent to the audit
team having jurisdiction over the audited
agencies. The audit team leader shall be
responsible in identifying the audit team
member(s) who will conduct or assist him in
conducting the cash examination. Special
audit teams may also be constituted by the
Chairperson or the Cluster/Regional
Director to conduct cash examinations.
Further, special audit teams may undertake
cash examinations as an incident to, or when
deemed necessary to complete the special
audit.

D. FREQUENCY AND EXTENT OF

EXAMINATION
In addition to the instances where cash
examination is mandatory, the exa.r:nination
of the cash and accounts of all accountable
officers shall be conducted at least once a
year.

The auditor shall verify the transactions

from the date of last cash examination to the
date of current examination. The verification
shall be limited to determining and
establishing that all cash receipts,
remittances/deposits, cash
advances/disbursements and adjusting
entries are properly and correctly recorded
in the Cashbook/Cash Receipts Record/Cash
Receipts Register (CRR)/Cash
Disbursements Record/Cash Disbursements
Register (CDR)/Check Disbursements
Record (CkDR)/Petty Cash Register (PCR),
or its equivalent; that disbursement
vouchers, as entered in the CDR/Ck.DR are
properly approved and payments duly
acknowledged; and that all cash balances as
of the date of examination are reconciled
with accounting and related records.

For purposes of implementation of the

revised manual, the balance of
accountabilities of accountable officers
determined in cash examinations conducted
in 2012 and 2013, whichever is the latest,
shall constitute the beginning balance of the
succeeding examination. Where the last cash
examination was conducted prior to 2012
and the transactions are volwninous, or there
is no record or information of the last
examination so conducted, the beginning
balance per books as of 01 January 2013
may be used as the beginning balance of
accountability and the transactions on that
date onward to the date of current
 examination shall be the coverage of
examination. Nothing in this provision shall
be construed as limiting the authority of the
auditor to extend his verification of balances
and transactions prior to 2012 if the
circumstances so require.

E. CASH EXAMINATlON REPORT

The result of the examination shall be

embodied in a narrative report consisting of
three parts; namely, the introduction, the
findings and recommendations, and the
appendices. Copies of the report shall be
submitted to the Supervising Auditor for
review and transmittal. However, Cash
Examination Report showing a cash
shortage which requires the filing of
administrative and/or criminal case against
the accountable officer shall be submitted to
the Cluster/Regional Director for fmal
disposition. The accountable officers and the
Head of Agency shall be fumished copies of
the report. The Auditor/Cash Examiner and
the Supervising Auditor should likewise
each have copy of the CER.

F. RESPONSffiiLITY FOR FILING

CASES

It shall be the responsibility of the Director

having supervision and control over the
team that conducted the cash examination to
initiate the filing of administrative and/or
c:riminal cases before the Office of the
Ombudsman or any other appropriate court
or tribunal. Where such action is initiated,
copies of the report as well as infonnation of
the action taken shall be given to the Head
and the Chief Accountant of the agency
concerned, the COA Legal Services Sector,
the Auditor of the agency concemed, and if
the defaulting accountable officer is a
treasurer of a local government unit, the
Bureau of Local Government Finance.

G. REPEALING CLAUSE

All ·issuances .inconsistent with this

memorandum or the Revised Cash
Examination Manual are hereby superseded,
amended or modified accordingly.

H. EFFECTIVITY

This memorandum shall take effect

immediately.