NGAS 2019 eBOOK

Copyrights Reserved: Braulio Adolfo Cloribel, Jr.
CPA, MBA, MPA
THE ROLE OF NATIONAL

GOVERNMENT ACCOUNTING
SYSTEM IN GOVERNANCE
2019 Edition All Rights Reserved:
BRAULIO ADOLFO CLORIBEL, JR.

CPA, MBA , MPA
Page 1 of 128
Copyrights Reserved to the author: Braulio Adolfo Cloribel, Jr. CPA, MBA, MPA
Table of Contents
Chapter 1 - The Role of NGAS in Governance 3
Chapter 2. ACCOUNTING POLICIES 5
Chapter 3. Basic Features and Policies 6
Chapter 4. Accounting Systems 9
Chapter 5. Trial Balances & Financial Statements 38
Chapter 6. Responsibility Accounting 49
Chapter 7. Illustrative Accounting Entries 51
Chapter 8. The Accounting Forms and Reports 56
Chapter 9. THE CHART OF ACCOUNTS 58
Chapter 10. DESCRIPTION OF ACCOUNTS 71
Copyrights Reserved to Publisher SPC CPA, LAW & Engineering Firm Page 2 of 128
Chapter 1 - The Role of NGAS in Governance

The role of NGAS in governance is to help internal and external stakeholders make
better decision by providing them with financial information.
 Explain the importance of NGAS in Governance
KEY POINTS
 NGAS is the language of governance required by stakeholders.

 NGAS communicates information that citizens, officers, directors, managers,
and investors need to evaluate government’s performance.
 Accountants typically work in one of two major fields: management NGAS ,
which helps you keep your government running, or financial NGAS , which tells
you how well you’re government is running it.
 The purpose of management NGAS is to supply forward looking, relevant,
accurate, timely information to managers in a format that will aid them in making
decisions.
 The purpose of financial NGAS is to provide information that helps with the
assessment of a firm's financial history and current performance.
 Financial NGAS includes equity statements, balance sheets, and statements
of cash flows.
FINANCIAL NGAS
Furnishes information to individuals and groups both inside and outside an
organization to help them assess the government’s financial history and
performance.
NGAS is often called “the language of governance.” Why? Because it

communicates so much of the information that citizens, officers, directors,
managers, and investors need to evaluate a government’s financial performance.
These people are all stakeholders in the business, which is to say they’re
interested in its activities because they’re affected by them.
In fact, the purpose of NGAS is to help stakeholders make better governance

decisions by providing them with financial information. Obviously, you wouldn’t try
to run an organization or make investment decisions without accurate and timely
financial information, and it’s the accountant who prepares this information.
MANAGEMENT NGAS
Management NGAS plays a key role in helping officers carry out their
responsibilities. Reports are tailored to the needs of individual managers, and the
purpose of such reports is to supply relevant, accurate, timely information in a
format that will aid them in making decisions. In preparing, analyzing, and
communicating such information, accountants work with individuals from all the
functional areas of the organization.
Actually, collecting all the numbers is the easy part—today, all you have to do is
start up your NGAS software. The hard part is analyzing, interpreting, and
communicating the information. Of course, you also have to present everything
clearly while effectively interacting with people from every business discipline.
All this means that "NGAS" can be defined as a system for measuring and
summarizing governance activities, interpreting financial information, and
communicating the results to officers and other decision makers.
Government Stakeholders: Internal and External

Stakeholder is an individual or group that has a legitimate interest in an
organization.
 A government stakeholder is a person or group who can affect or be affected by
its actions.
 Internal stakeholders are entities within a government (e.g., employees, officers,

the elected officials, citizens).
 External stakeholders are entities not within a government itself but who care
about or are affected by its performance (e.g., consumers, regulators, investors,
suppliers, and nations).
The stakeholder concept was first used in a 1963 internal memorandum at the
Stanford Research Institute. It defined stakeholders as "those groups without
whose support the organization would cease to exist. "
In the last decades of the 20th century, the word "stakeholder" has become more
commonly used to refer to a person or group that has a legitimate interest in a
project or entity. In discussing the decision-making process for institutions—
including large business corporations, government agencies, and non-
profit organizations -- the concept has been broadened to include everyone with
an interest (or "stake") in what the entity does.
Chapter 2. ACCOUNTING POLICIES

Introduction
Objectives. The New Government Accounting System (NGAS) presents the basic
policies and procedures; the new coding system; the accounting systems, books,
registries, records, forms, reports, and financial statements; and illustrative accounting
entries to be adopted by all national government agencies effective January 1, 2002. The
objectives of the Manual are to prescribe the following:
a. Uniform guidelines and procedures in accounting for government funds and

property;
b. New coding structure and chart of accounts;
c. Accounting books, registries, records, forms, reports and financial statements;
and
d. Accounting entries.
Coverage. NGAS shall be used by all government agencies.
Legal Basis. NGAS is prescribed by the Commission on Audit pursuant to Article IX-D,
Section 2 par. (2) of the 1987 Constitution of the Republic of the Philippines which provides
that:
“The Commission on Audit shall have exclusive authority, subject to the

limitations in this Article, to define the scope of its audit and examination,
establish the techniques and methods required therefore, and promulgate
accounting and auditing rules and regulations, including those for the
prevention and disallowance of irregular, unnecessary, excessive,
extravagant, or unconscionable expenditures, or uses of government funds
and properties". (underscoring supplied)
Chapter 3. Basic Features and Policies

Basic Features and Policies. NGAS has the following basic features and policies, to wit:
a. Accrual Accounting. Modified accrual basis of accounting shall be used.

Under this method, all expenses shall be recognized when incurred and
reported in the financial statements in the period to which they relate.
Illustrations:
Prepaid Expenses-
Prepaid Rent (161). This account is used to record the advance payment and deposit for
lease/rental of buildings, land, equipment, office space, vehicles and other property, plant
and equipment for use in government operations.
Debit Prepaid Rent (161) for:

Advance payment and deposit for lease/rental of buildings, land, office
space, equipment, vehicles and other properties for use in
government operations
Credit Prepaid Rent (161) for:

Expired or expense portion at the end of the accounting period
b. Income shall be on accrual basis except for transactions where accrual basis
is impractical or when other methods are required by law.
Accrued Income-
Deferred Credits to Income (440). This account is used to record amount collected for
revenues not yet earned.
Debit Deferred Credits to Income (440) for:

Income earned during the period
Credit Deferred Credits to Income (440) for:

Collections for-
Services not yet rendered

Goods not yet delivered
Income not yet earned
c. One Fund Concept. This system adopts the one fund concept. Separate fund
accounting shall be done only when specifically required by law or by a donor
agency or when otherwise necessitated by circumstances subject to prior
approval of the Commission.
d. Chart of Accounts and Account Codes. A new chart of accounts and coding
structure with a three-digit account numbering system shall be adopted. (See
Volume III, The Chart of Accounts)
e. Books of Accounts. All national agencies shall maintain two sets of books,
namely:
Regular Agency (RA) Books. These shall be used to record the

receipt and utilization of Notice of Cash Allocation(NCA) and other
income/receipts which the agencies are authorized to use and to deposit with
Authorized Government Depository Bank (AGDB) and the National Treasury.
These shall consist of journals and ledgers, as follows:
Journals
 Cash Receipts Journal (CRJ)

 Cash Disbursements Journal (CDJ)
 Check Disbursements Journal (CkDJ)
 General Journal (GJ)
Ledgers
 General Ledger (GL)
 Subsidiary Ledgers (SL) for:

 Cash
 Receivables
 Inventories
 Investments
 Property, Plant and Equipment
 Construction in Progress
 Liabilities
 Income
 Expenses
National Government (NG) Books. These shall be used to record

income which the agencies are not authorized to use and are required to be
remitted to the National Treasury. These shall consist of:
 Cash Journal (CJ)

 General Journal (GJ)
 General Ledger (GL)
 Subsidiary Ledger (SL)
With the implementation of the computerized agency accounting

system, only the General Journal shall be used together with the ledgers by
both books.
f. Financial Statements. The following statements shall be prepared:
 Balance Sheet
 Statement of Government Equity
 Statement of Income and Expenses
 Statement of Cash Flows
Notes to Financial Statements shall accompany the above statements.
g. Two-Money Column Trial Balance. The two - money column trial balance
showing the account balances shall be used.
h. Allotment and Obligation. Obligation accounting is modified to simplify

procedures in the incurrence and liquidation of obligations and the recording of
the budgetary accounts (allotments and obligations incurred and liquidated).
Separate registries shall be maintained to control the allotments and
obligations for each of the four classes of allotments, namely:
 Registry of Allotments and Obligations - Capital Outlay (RAOCO)

 Registry of Allotments and Obligations - Maintenance and Other
Operating Expenses (RAOMO)
 Registry of Allotments and Obligations - Personal Services (RAOPS)
 Registry of Allotments and Obligations- Financial Expenses (RAOFE).
i. Notice of Cash Allocation (NCA). The receipt of NCA by the agency shall be
recorded in the books as debit to account “Cash-National Treasury,
Modified Disbursement System (MDS)” and credit to account “Subsidy
Income from National Government”.
j. Financial Expenses. Financial expenses such as bank charges, interest

expenses, commitment charges and other related expenses shall be
separately classified from Maintenance and Other Operating Expenses
(MOOE).
k. Perpetual Inventory of Supplies and Materials. Supplies and materials

purchased for inventory purpose shall be recorded using the perpetual
inventory system. Regular purchases shall be coursed thru the inventory
account and issuances thereof shall be recorded as they take place except
those purchased out of Petty Cash Fund which shall be charged directly to the
appropriate expense accounts.
l. Valuation of Inventory. Cost of ending inventory of supplies and materials

shall be computed using the moving average method.
m. Maintenance of Supplies and Property, Plant and Equipment Ledger

Cards. For appropriate check and balance, the Accounting Units of agencies,
as well as the Property Offices, shall maintain Supplies Ledger Cards/Stock
Cards by stock number and Property, Plant and Equipment Ledger
Cards/Property Cards by category of property, plant and equipment,
respectively.
n. Construction of Assets. For assets under construction, the Construction

Period Theory shall be applied for costing purposes. Bonus paid to the
contractor for completing the work ahead of time shall be added to the total
cost of the project. Liquidated damages charged and paid for by the contractor
shall be deducted from the total cost of the project. Any related expenses
incurred during the construction of the project, such as taxes, interest, license
fees, permit fees, clearance fee, etc. shall be capitalized, and those incurred
after the construction shall form part of operating cost.
o. Registry of Public Infrastructures/Registry of Reforestation Projects. For
agencies that construct public infrastructures, such as roads, bridges,
waterways, railways, plaza, monuments, etc., and invest on reforestation
projects, a Registry of Public Infrastructures (RPI)/Registry of Reforestation
Projects (RRP) shall be maintained for each category of
infrastructures/reforestation projects. Examples are:
 Registry of Public Infrastructures - Bridges (RPIB)

 Registry of Public Infrastructures - Roads (RPIR)
 Registry of Public Infrastructures - Parks (RPIP)
 Registry of Reforestation Projects (RRP)
A Summary of Public Infrastructures/Reforestation Projects shall be prepared

and included in the Notes to Financial Statements.
p. Depreciation. The straight-line method of depreciation shall be used.

Depreciation shall start on the second month after purchase of the property,
plant and equipment, and a residual value equivalent to ten percent of the
purchase cost shall be set-up. Public infrastructures/reforestation projects as
well as serviceable assets that are no longer being used shall not be charged
any depreciation.
q. Reclassification of Assets. Serviceable assets no longer being used shall be

reclassified to “Other Assets” account and shall not be subject to depreciation.
r. Allowance for Doubtful Accounts. An Allowance for Doubtful Accounts shall

be set up for estimated uncollectible trade receivables to allow for their fair
valuation.
s. Elimination of Contingent Accounts. Contingent accounts shall no longer be

used. All financial transactions shall be recorded using the appropriate
accounts. Cash shortages and disallowed payments, which become final and
executory, shall be recorded under receivable accounts “Due From Officers
and Employees” or “Receivables-Disallowances/ Charges”, as the case may
be.
t. Recognition of Liability. Liability shall be recognized at the time goods and

services are accepted or rendered and supplier/creditor bills are received.
u. Interest Accrual. Whenever practical and appropriate, interest income and/or

expense shall be accrued and recognized in the books of accounts.
v. Accounting for Borrowings and Loans. All borrowings and loans incurred
shall be recorded to the appropriate liability accounts.
w. Elimination of corollary and negative journal entries. The use of corollary

and negative journal entries shall be stopped. Acquisition/Disposition of assets
shall be debited/credited to the appropriate asset accounts. If an error is
committed, a correcting entry to adjust the original entry shall be prepared.
x. Petty Cash Fund. The Petty Cash Fund shall be maintained under the
imprest system. As such, all replenishments shall be directly charged to the
expense account and at all times, the Petty Cash Fund shall be equal to the
total cash on hand and the unreplenished expenses. The Petty Cash Fund
shall not be used to purchase regular inventory/items for stock.
y. Foreign Currency Adjustment. Cash deposits in foreign currency and

outstanding foreign loans shall be computed at the exchange rate prescribed
by the Bangko Sentral ng Pilipinas at balance sheet date. The total cash
deposits and foreign loans payable shall be adjusted at the end of each month
and any gain or loss on foreign exchange shall be recognized. The subsidiary
ledger for foreign currency obligations shall reflect the appropriate foreign
currency in which the loan is payable. The liability shall be expressed both in
the foreign and local currency.
Chapter 4. Accounting Systems

General Accounting. General Accounting shows the overall accounting system of a
government agency/unit. It includes the source documents, the flow of transactions and
its accumulation in the books of accounts and finally their conversion into financial
information/data presented in the financial reports. Presented on next page is the General
Accounting Plan for national government agencies.
The following accounting systems are:

a. Budgetary Accounts System;
b. Receipts/Income and Deposit System;
c. Disbursement System and;
d. Financial Reporting System.
A. BUDGETARY ACCOUNTS
Budgetary Accounts System. Budgetary Accounts System encompasses the

processes of preparing Agency Budget Matrix (ABM), monitoring and recording of
allotments received by the agency from the DBM, releasing of Sub-Allotment Release
Order (Sub-SARO) to Regional Offices(RO) by the Central Office(CO); issuance of Sub-
SARO to Operating Units(OU) by the RO; and recording and monitoring of obligations.
Budgetary Accounts. Budgetary accounts consist of the appropriations, allotments and

obligations. Appropriations refer to authorizations made by law or other legislative
enactment for payments to be made with funds of the government under specified
conditions and/or for specified purposes. Appropriations shall be monitored and controlled
through registries and control worksheets by the DBM and COA, respectively. Budgetary
accounts allotments and obligations are discussed in the succeeding sections.
GENERAL ACCOUNTING
Agency Budget Matrix(ABM). ABM refers to a document showing the
disaggregation of agency expenditures into components like, among others, by source of
appropriations, by allotment class and by need of clearance.
Procedures in Preparation of the ABM
Area of Seq
Responsibility . Activity
No.
Budget Unit
Concerned Staff 1 Based on the approved General Appropriations Act (GAA)
and in coordination with the DBM, prepares the ABM by
appropriations/financing sources to support expenditures to
be made during the year broken down by allotment
class/expenses.
Note 1
The ABM shall contain, among others, the following
information:
 The amount to be released categorized under “Not
Needing Clearance” column, and
 The amount that will be released through the issuance
of Special Allotment Release Order (SARO)
categorized under "Needing Clearance” column
including continuing appropriations based on the
Statement of Allotments, Obligations and Balances
(SAOB).
2 Initials under 'Prepared by' portion of the ABM.
Head, Budget Unit 3 Reviews and signs ‘Prepared by’ portion of the ABM.
Concerned Staff 4 Forwards the ABM together with a transmittal letter for the
DBM to the Head of the Agency for signature/approval.
Head of the 5 Approves/Signs the ABM and the transmittal letter.

Agency
Concerned Staff 6 Records in the logbook maintained and submits the signed
ABM to the DBM for approval.
Allotment Release Order (ARO). ARO is a formal document issued by the DBM
to the head of the agency containing the authorization, conditions and amount of an
agency allocation. The document may be the ABM, where the amount of allocation not
needing clearance is indicated, or the Special Allotment Release Order (SARO), where
the release of which is subject to compliance with specific laws or regulations or is subject
to separate approval or clearance by competent authority. In the case of agencies with

decentralized accounting procedures, Sub-ARO/Sub-SARO is issued/released.
Recording of Allotments. Upon receipt of the approved ABM and ARO, the
Budget Officer/Head of the Budget Unit/Designated Budget Officer shall record the
allotment in the respective registries through the Allotment and Obligations Slip (ALOBS).
Separate registries shall be maintained for the four allotment classes by
Program/Project/Activity (P/P/A), to wit:
1. Registry of Allotments and Obligations - Capital Outlay (RAOCO)

2. Registry of Allotments and Obligations - Maintenance and Other Operating
Expenses (RAOMO)
3. Registry of Allotments and Obligations - Personal Services (RAOPS)
4. Registry of Allotments and Obligations - Financial Expenses (RAOFE)
Procedures in Monitoring and Recording of Allotments Received from DBM
Area of Seq
No.
Budget Unit 1 Receives the approved ABM/SARO from the DBM.

Concerned Staff Records the same in the logbook and forwards the
ABM/SARO to Budget Staff for preparation of an Allotment
and Obligation Slip(ALOBS).
Budget Staff 2 Prepares ALOBS in two copies, assigns number and initials
the same. Forwards the ALOBS and ABM/SARO to the
Head of the Budget Unit for review and signature.
Note 1
The numbering structure of the ALOBS shall be as follows:
PS 00 000000
Serial Number
(One series for
the whole year)
Month
Year
Allotment Class
(PS, MOOE, CO and
FE) shall be used
only when obligations are recorded in
the ALOBS
Note 2
The ALOBS shall be prepared in two copies and shall be
distributed as follows:
Original-Retained by the Budget Unit to support recording
in the registries
Copy 2 -Accounting Unit
Head of the 3 Reviews, checks the small box opposite the 'Received'
Budget Unit portion in Box A of the ALOBS and affixes signature
certifying receipt of allotment. Returns to the Budget Staff
for recording in the appropriate Registry of Allotments and
Obligations (RAOs).
Budget Staff 4 Records the ALOBS in the appropriate RAOs. Files the
ALOBS for reference.
Area of Seq
No.
Note 3
The following RAOs shall be maintained by the Budget
Unit:
 Registry of Allotments and Obligations - Personal
Services (RAOPS)
 Registry of Allotments and Obligations -Maintenance
and Other Operating Expenses (RAOMO)
 Registry of Allotments and Obligations -Capital
Outlays (RAOCO)
 Registry of Allotments and Obligations - Financial
Expenses (RAOFE)
5 Forwards Copy 2 of the ALOBS to the Accounting Unit for

reference.
Procedures in Recording Sub-Allotment Release Order (Sub-ARO) by RO/OU
Area of Seq
No.
Central Office/
Regional Office
Budget Unit 1 Based on the approved ABM received from the DBM,
Budget Staff prepares Sub-ARO for RO/OU. Forwards the Sub-ARO to
the Head of the Budget Unit CO/RO for review.
Head of the 2 Reviews and signs Sub-ARO. Forwards the same to the
Budget Unit Head of the CO/RO for approval.
Head of Central 3 Approves the Sub-ARO.

Authorized
Officer
Budget Staff 4 Based on the approved Sub-ARO, prepares ALOBS in two

copies. Assigns number and initials the ALOBS. Forwards
the same with a copy of approved Sub-ARO to the Head of
the Budget Unit for review and signature.
Note 1
Distribution of ALOBS shall be as follows:
Original - CO/RO Budget Unit
Copy 2 - CO/RO Accounting Unit
Note 2
Refer to ALOBS numbering structures in Note 1 Sec. 12,
Procedures in the Monitoring and Recording of Allotments
Received from DBM
Head of the 5 Reviews, checks the small box opposite the ‘Sub-allotted’
Budget Unit portion of Box A of the ALOBS and affixes signature
certifying as to the amount sub-allotted to RO/OU.
Forwards the same with the approved Sub-ARO to Budget
Staff for recording in the appropriate RAOs.
Area of Seq
No.
Budget Staff 6 Records the ALOBS in the appropriate RAOs. Files the
ALOBS and a copy of the Sub-ARO.
Note 3
The ALOBS covering sub-allotment for the RO/OU shall be
entered in the RAOs as negative entry in the ‘Allotment’
column and shall be deducted from the allotment balance.
Note 4
A copy of the ALOBS covering allotment of the RO/OU shall
be furnished the Accounting Unit for reference.
Concerned Staff 7 Records in the logbook the release of the Sub-ARO to

RO/OU.
Budget Unit
Concerned Staff 8 Receives the approved Sub-ARO from the CO/RO.
Records the same in the logbook maintained. Forwards the
Sub-ARO to the Budget Staff for the preparation of ALOBS.
Budget Staff 9 Prepares ALOBS in two copies, assigns number and initials
the same. Forwards the ALOBS and Sub-ARO to the Head
of the Budget Unit for review and signature.
Note 5
Refer to Notes 1 and 2 of Sec.12, Procedures for the
Monitoring and Recording of Allotments Received from the
DBM.
Head of the 10 Reviews the ALOBS based on the Sub-ARO. Checks the
Budget Unit small box opposite the “Received” portion of Box A of the
ALOBS and affixes signature certifying that the allotment
was received. Forwards the ALOBS and Sub-ARO to the
Budget Staff for recording in the appropriate RAOs.
Note 6
Refer to Note 3, of Sec.12, Procedures for the Monitoring
and Recording of Allotments Received from the DBM.
Budget Staff 11 Records the ALOBS in the RAOs. Files the Sub-ARO and
original of the ALOBS.
12 Forwards copy 2 of the ALOBS to the Accounting Unit for

reference.
Accounting for Obligation. Obligation refers to a commitment by a government agency

arising from an act of a duly authorized official which binds the government to the
immediate or eventual payment of a sum of money. The agency is authorized to incur
obligations only in the performance of activities which are in pursuits of its functions and
programs authorized in appropriation acts/laws within the limit of the ARO.
Obligations shall be taken up in the registries through the ALOBS
prepared/processed by the Budget Unit. The Budget Officer/ Head of the Budget
Unit/designated Budget Officer shall certify to the availability of allotment and such is duly
obligated by signing in the appropriate box of the ALOBS. On the other hand, the
Accountant/Head of the Accounting Unit shall certify to the correctness and validity of
obligations, and availability of funds. Both Budget and Accounting Units shall coordinate
in the filling up of the Status of the Obligation in their respective copies of the ALOBS.
Procedures in Recording of Obligations

Area of Seq
No.
Budget Unit
Concerned Staff 1 Receives the Disbursement Voucher/Payroll(DV/P), and
supporting documents, Contract / Purchase Order(C/PO)
from concerned offices/personnel. Verifies completeness
of the documents. If incomplete, returns the documents to
concerned offices for completion. If complete, records the
same in the logbook maintained. Forwards the documents
to Budget Staff for the preparation of the ALOBS.
Budget Staff 2 Verifies availability of allotment based on the RAOs. If no

allotment is available, returns the documents to the
office/personnel concerned except as authorized by the
DBM.
3 If there is an available balance of allotment to cover the

obligations, prepares an ALOBS in three copies. Initials the
ALOBS and forwards the same to the Head of the Budget
Unit for review and signature.
Note 1
Copy 3 of ALOBS shall be attached to the DV. Refer to Note
2, Sec. 12, Procedures for the Monitoring and Recording of
Allotments Received from DBM for the distribution of the
other copies of ALOBS.
Head of the 4 Reviews, checks the small box opposite the ‘Available and
Budget Unit duly obligated’ portion of Box A of the ALOBS and affixes
signature. Forwards the ALOBS and documents to the
Budget Staff for recording in the appropriate RAOs.
Budget Staff 5 Records the amount obligated under the ‘Obligation’
column of the RAOs. Forwards all copies of the ALOBS and
the documents to the Accounting Unit for processing and
signature.
Note 2
Obligations shall be posted in the ‘Obligation Incurred’
column of the RAOs to arrive at the balance of allotment
still available at a given period.
6 Receives original of ALOBS from the Accounting Unit. If
there is no correction, files the same to support the RAOs.
Otherwise, effects correction in the RAOs or prepares a
new ALOBS, as the case may be.
Note 3
For the succeeding activities, refer to Sec. 34, Procedures
for Disbursements By Checks.
Note 4
There is no need to prepare a new ALOBS for
corrections/adjustments made by the Accounting Unit after
the processing of the claims but before payment is made.
Adjustment in the RAOs shall be effected thru a positive
entry (if additional obligation is necessary) or a negative
entry (if reduction) in the ‘Obligation Incurred’ column.
Note 5
Preparation of new ALOBS for the following adjustments of
Area of Seq
No.
obligations as negative entries in the ‘Obligation Incurred’
column shall be made:
 refund of cash advance granted during the year

 overpayment of expenses during the year
 disallowances/charges which become final and
executory
Certified copies of official receipts for the

overpayments/refunds, copies of bills for overpayments
and Notice that the disallowances are final and
executor shall be furnished the Budget Unit by the
Accounting Unit for the preparation of new ALOBS taking
up the adjustments.
B. INCOME/COLLECTIONS AND DEPOSITS
Receipts/Income Collections and Deposits System. Receipts/Income

Collections and Deposits System covers the processes of acknowledging and reporting
income/collections, deposits of collections with Authorized Government Depository Bank
(AGDB) or through the AGDB for the account of Treasurer of the Philippines, and
recording of collections and deposits in the books of accounts of the agency.
Sources of Income of the National Government. Income of the National

Government is classified into general income accounts and specific income accounts.
GENERAL INCOME ACCOUNTS, among others:
1. Subsidy Income from National Government

2. Subsidy from Central Office
3. Subsidy from Regional Office/Staff Bureaus
4. Income from Government Services
5. Income from Government Business Operations
6. Sales Revenue
7. Rent Income
8. Insurance Income
9. Dividend Income
10. Interest Income
11. Sale of Confiscated Goods and Properties
12. Foreign Exchange (FOREX) Gains
13. Miscellaneous Operating and Service Income
14. Fines and Penalties-Government Services and Business
Operations
15. Income from Grants and Donations
SPECIFIC INCOME ACCOUNTS of national government agencies are
classified as follows:
1. Income Taxes
2. Property Taxes
3. Taxes on Goods and Services
4. Taxes on International Trade and Transactions
5. Other Taxes
6. Fines and Penalties-Tax Revenue
7. Other Specific Income
The descriptions of all the accounts and the instructions as to when these are
to be debited and credited are provided in Volume III of the NGAS Manual.
Methods of Accounting for Income. National government agencies adopt the

following accounting methods of recording income:
1. Accrual Method - Accrual method of accounting shall be used by national
government agencies when income is realized (earned) during the accounting
period regardless of cash receipt. Accounts receivable is set up and the
general or specific income accounts according to nature and classification are
credited.
2. Modified Accrual – Under the modified accrual basis, income of an agency is

recorded as “Deferred Credits to Income” and the appropriate receivable
account is debited. The income account is recognized upon receipt of
collection and the “Deferred Credits to Income” account is adjusted
accordingly.
3. Cash Basis - Cash basis of accounting shall be used for all other taxes, fees,
charges and other revenues where accrual method is impractical. The income
account is credited upon collection of the cash or its equivalent.
Fines and Penalties. Fines and penalties, either on tax revenues or other specific
income accounts, shall be recognized as income of the year these were collected.
Other Receipts. Other receipts of national government agencies shall be
comprised of, but not limited to the following:
1. Refund of cash advances - When cash advances for official travels are granted,
the account “Due from Officers and Employees” is debited and when refunds
are made, the same account is credited. Cash advances for salaries and
wages shall be recorded as debits to the account “Cash-Disbursing Officers”
and any refunds thereof shall be credited to the same account.
2. Receipts of performance/bidders/bail bonds - Performance bond posted by

contractor or supplier to guaranty full and faithful performance of their contract
may be in the form of cash or certified checks or surety. Performance bond in
cash or certified check shall be acknowledged by the issuance of official receipt
and recorded in the book of accounts by the Accountant thru a Journal Entry
Voucher (JEV) for the purpose. In case of surety bond, an acknowledgement
receipt shall be issued by the authorized official.
3. Refund for overpayment of expenses - Refunds as a result of overpayment of

expenses shall be recorded as a credit to the appropriate expense account if
paid in the same year or to Prior Years’ Adjustments if paid in the ensuing year.
This transaction shall reduce the amount of expense previously recorded.
4. Collections made on behalf of another agency or private companies -

Collections made on behalf of other agencies which are later remitted to them
are recorded under accounts “Due to NGAs”, “Due to LGUs” or “ Due to
GOCCs” as the case maybe. Authorized collections made on behalf of private
entities, like shares of proponents of Built-Operate-Transfer (BOT) Projects are
recorded as “Other Payables”.
5. Inter-agency transferred funds - Cash received from another agency for the
purpose of implementing projects of that agency is recorded in the books as a
credit to account “Due to NGAs” or “Due to LGUs”, as the case maybe.
Deposit of Collections Collecting Officers shall deposit intact all their collections,
as well as collections turned over to them by sub-collectors/tellers, with AGDB daily or not
later than the next banking day. They shall record all deposits made in the Cash Receipts
Record.
Reporting of Collections and Deposits. At the close of each business day, the
Collecting Officers shall accomplish the Report of Collections and Deposits (RCD) in
accordance with the instructions provided in Volume II of the NGAS Manual for the
RCD. All collections shall be deposited with AGDB for the account of the agency or the
Treasurer of the Philippines daily or not later than the next banking day.
Procedures for Collections and Deposits Through the Collecting Officer
Area of Seq
No.
Cash Unit Daily

Designated 1 Receives cash/check from payor representing collection
Staff based on the Order of Payment (OP) prepared by the
Accounting Unit.
2 Issues Official Receipt (OR) to acknowledge receipt of

cash/check.
Note 1
Funding Checks received by the Cashier/ Collecting Officer
of the RO/OU for its operational requirements shall be
issued corresponding OR..
Note 2
Separate sets of ORs shall be used for the RA and NG
Books.
Note 3
The OR shall be prepared in three copies and shall be
distributed as follows:
Original - Payor
Copy 2 - To be attached to the Report of Collections and
Deposits (RCD)
Copy 3 - Cash Unit file
3 Records collections in the Cash Receipts Record (CRR).
Note 4
Separate CRR shall be maintained for collections under the
RA and NG Books.
4 Prepares Deposit Slip (DS) in three copies.
Note 5
The DS shall be distributed as follows:
Original - AGDB
Copy 2 - To be attached to RCD
5 Deposits collections with AGDB.
Note 6
Collections pertaining to NG Books shall be deposited with
the AGDB for the account of the Treasurer of the Philippines
6 Based on the validated DS from the AGDB and copy of the

ORs on file, prepares Report of Collections and Deposits
(RCD) in two copies. Initials on the RCD and forwards the
same together with Copy 2 of the ORs and DS to the Head
of the Cash Unit for review and signature.
Area of Seq
No.
Head of the 7 Reviews and signs the RCD. Forwards original of RCD,
Cash Unit Copy 2 of the ORs and DS to the Designated Staff for
submission to the Accounting Unit.
Note 7
The RCD shall be distributed as follows:
Original - Accounting Unit together with Copy No. 2 of the
ORs and DS - to support the JEV
Designated Staff 8 Records the RCD in the logbook maintained and forwards
the same with the ORs and DS to the Accounting Unit for
recording in the books of accounts.
Accounting Unit
Accounting Staff 9 Receives original of RCD with Copy 2 of the ORs and DS
from the Cash Unit. Records receipt in the logbook
maintained for the purpose and forwards the same to the
Bookkeeper for review and preparation of the JEV.
Bookkeeper 10 Based on the RCD, prepares JEV in two copies and signs
“Prepared by” portion of the JEV. Forwards the JEV and
documents to the Head of the Accounting Unit for review and
signature.
Head of the 11 Reviews and signs ‘Certified Correct by’ portion of the JEV.
Accounting Forwards the JEV and documents to the Bookkeeper for
Unit recording in the Cash Receipt Journal (CRJ) and/or Cash
Journal (CJ) as the case may be.
Note 8
CRJ shall be used to record collection under the RA Books
while the CJ shall be used to record collections under the
NG Books.
Note 9
For the succeeding activities, refer to Sec. 71, Preparation
and Submission of Trial Balances and Other Reports.
Procedures for Collections through Accredited Agent Banks (AAB)
Area of Seq
No.
Accounting Unit
Receiving/ 1 Receives collection documents from the AAB/AGDB.
Releasing Staff Records receipt in the logbook maintained for the purpose.
Forwards the same to the Bookkeeper for preparation of the
JEV.
Bookkeeper 2 Based on the received collection documents, prepares JEV

in two copies, Signs “Prepared by” portion of the JEV.
Forwards the JEV and documents to the Head of the
Accounting Unit for review and signature.
Area of Seq
No.
Head of the 3 Reviews and signs “Certified Correct by” portion of the JEV.
Accounting Unit Forwards the JEV and documents to the Bookkeeper for
recording in the General Journal (GJ).
Note 1
Dishonored Checks. There are instances that checks received by Collecting

Officers in payment of taxes, fees and other debt due the government are dishonored by
the drawee banks. A check is said to be dishonored by non-payment when, upon its being
duly presented for payment, such payment is refused or cannot be obtained. (Sec. 83, RA
No. 2031, Negotiable Instrument Law). It may also be defined as those checks paid to the
agency, which were dishonored by the AGDB due to Drawn Against Insufficient Fund
(DAIF) or Drawn Against Uncleared Deposits (DAUD).
Procedures in Recording Dishonored Checks
Area of Seq
No.
Cash Unit
Designated Staff 1 Receives from AGDB the Debit Memo (DM) and copies of
dishonored checks.
2 Verifies the dishonored checks against the previous months’

RCDs maintained on file to ascertain that the checks were
included in the previous months’ collections. If not included,
verifies from AGDB the details of the dishonored checks.
3 If dishonored checks are included in the RCDs, prepares

Notice of Dishonor to inform the drawers/indorsers/payors
that the checks were dishonored by the AGDB.
Note 1
The Notice of Dishonor shall be prepared in three copies and
shall be distributed as follows:
Original - Drawer (To be delivered personally or thru registered
mail)
Copy 2 - Accounting Unit file
4 Retrieves from file copy of the OR covering the dishonored

check and indicates in the OR the following notation:
“Cancelled (date of Notice of Dishonor) per Bank

Debit/Voucher No._____ dated _________”
5 Retrieves CRR on file and records the dishonored checks

with the following notation:
“To take up Bank’s Debit Memo No. ___ dated ____
covering Check No. ___ for P ____________
acknowledged under OR No. _____ dated _______”.
Area of Seq
No.
6 Prepares list of dishonored checks in two copies. Forwards

Copy 2 of the list and the dishonored checks to the
Accounting Unit for preparation of the JEV.
Accounting Unit 7 Receives the list together with originals of dishonored

Accounting Staff checks and the Debit Memo from the Cash Unit and records
the same in the logbook maintained for the purpose.
8 Based on the list, prepares the JEV in two copies. Signs

“Prepared by” portion of the JEV and forwards the same to
the Head of the Accounting Unit for review and signature.
Head of the 9 Reviews and signs “Certified Correct by” portion of the JEV.
Accounting Unit Forwards the JEV supported by the list, originals of
dishonored checks and notice of dishonor to the Bookkeeper
for recording in the books of accounts.
Note 2
For the succeeding activities, refer to Sec.71, Preparation
C. DISBURSEMENTS
Disbursements Defined. Disbursements constitute all cash paid out during a given
period either in currency (cash) or by check. It may also mean the settlement of
government payables/obligations by cash or by check. It shall be covered by
Disbursement Voucher (DV)/Petty Cash Voucher (PCV) or payroll.
Basic Requirements for Disbursements. The basic requirements applicable to all types
of disbursements made by national government agencies are as follows:
1. Existence of a lawful and sufficient allotment certified as available by the

Budget Officer;
2. Existence of a valid obligation certified by the Chief Accountant/Head of

Accounting Unit;
3. Legality of transactions and conformity with laws, rules and regulation;
4. Approval of the expense by the Chief of Office or by his duly authorized

representative; and
5. Submission of proper evidence to establish the claim.
Disbursements System. Disbursements System involves the preparation and

processing of disbursement voucher(DV); preparation and issuance of check; payment
by cash; granting, utilization, and liquidation/replenishment of cash advances.
Certification on Disbursements. Disbursements from government funds shall

require the following certifications on the DV:
1. Certification and approval of vouchers and payrolls as to validity, propriety and

legality of the claim (Box A of DV) by head of the department or office who has
administrative control of the fund concerned;
2. Necessary documents supporting the DV and payrolls as certified and

reviewed by the Accountant/Head of Accounting Unit (Box B of DV); and
3. Certification that funds are available for the purpose by the Accountant/Head
of Accounting Unit (Box B of DV).
Disbursements by Checks. Checks shall be drawn only on duly approved DV or

PCV. These shall be reported and recorded in the books of accounts only when actually
released to the respective payees.
Two types of checks are being issued by government agencies as follows:
1. Modified Disbursement System (MDS) Checks - issued by government

agencies chargeable against the account of the Treasurer of the Philippines,
which are maintained with different MDS - Government Servicing Banks
(GSBs). These are covered by Notice of Cash Allocation, an authorization
issued by the DBM to government agencies to withdraw cash from the National
Treasury through the issuance of MDS checks or other authorized mode of
disbursements.
2. Commercial Checks - issued by government agencies chargeable against the

Agency Checking Account with GSBs. These are covered by income/receipts
authorized to be deposited with AGDBs; and funding checks received by
RO/OUs from COs/ROs, respectively.
Recording of Check Disbursements in the Check Disbursements Record

(CkDR). All checks issued including cancelled checks shall be recorded chronologically
in the CkDR. The dates checks were actually released shall be indicated in the appropriate
column provided for in the CkDR.
Reporting of Checks Issued/Released. All checks actually released to claimants

shall be included in the Report of Checks Issued(RCI), which shall be prepared daily by
the Cashier. The RCI shall be submitted to the Accounting Unit for the preparation of JEV.
All unreleased checks as of the report date shall be enumerated in a “List of Unreleased
Checks” to be attached to the RCI.
Procedures in Disbursements by Checks.
Area of Seq
No.
A. Processing of Disbursement Voucher(DV)

Accounting Unit
Receiving/ 1 Receives Copies 1-3 of DV, originals of supporting
Releasing documents and Copies 1-3 of ALOBS from the Budget Unit.
Staff Checks completeness of supporting documents. If
incomplete, returns to the concerned party for compliance.
2 If complete, stamps “Received” and indicates date of receipt

and initials on the stamped ‘Received’ portion of the DV.
Note 1
DV that shall be paid out of non-budgetary receipts shall not
pass the Budget Unit. No ALOBS is needed. (Example -
refund of cash bond).
3 Assigns DV number and records in the logbook the DV

number and date, payee, particular and amount. Forwards
Copies 1-3 of DV, originals of supporting documents and
Copies 1-3 of ALOBS to the Designated Staff for processing.
Note 2
The numbering structure for DV shall be as follows:
Area of Seq
No.
00 - 00 - 0000
Serial Number
(One series for each year)
Month of Issue
Year of Issue
Note 3
DV number shall also be indicated on every sheet of the
supporting documents.
Designated Staff 4 Receives Copies 1-3 of DV, originals of supporting

documents and Copies 1-3 of ALOBS from the
Receiving/Releasing Staff. Reviews DV for completeness
and propriety of supporting documents.
5 Checks Index of Payments (IP) from file and determines

whether there was prior payment of the same claim. If the
claim was already paid, returns the DV and supporting
documents to the Receiving/Releasing Staff to be returned
to claimant.
6 If not yet paid, records the following in the IP: name and
address of creditor, DV date and number, particulars and
amount.
7 Accomplishes Box B of ALOBS and initials.
8 Initials in Box B of DV and forwards Copies 1-3 of DV,

originals of supporting documents and Copies 1-3 of ALOBS
to the Head of Accounting Unit for review and signature.
Head of the 9 Reviews DV and supporting documents. Signs in Box B of

Accounting Unit DV and ALOBS. Forwards the documents to the
Receiving/Releasing Staff.
Receiving/ 10 Records in the logbook the date of release of Copies 1-3 of

Releasing Staff DV, originals of supporting documents and Copy 3 of
ALOBS. Forwards to the Head of Agency or Authorized
Representative for approval of the DV. Forwards Copy 1 of
ALOBS to the Budget Unit and retains Copy 2 of ALOBS for
file.
Head of Agency 11 Reviews and approves DV. Forwards Copies 1-3 of DV,
or Authorized Copy 3 of the ALOBS and originals of supporting documents
Representative to the Cash Unit for check preparation.
B. Preparation and Approval of Checks

Cash Unit
Receiving/ 12 Receives Copies 1-3 of approved DV, Copy 3 of ALOBS and
Releasing Staff originals of supporting documents. Records in the logbook
the date of receipt, DV number, payee, particulars and
amount.
Area of Seq
No.
Designated 13 Verifies completeness of signatories on the DV. Prepares

Staff check in three copies.
14 Retrieves from file the Check Disbursements Records

(CkDR) and records the date, reference or check number,
name of payee, nature of payment and amount of the DV
and extract the new balance of the NCA/bank account.
Forwards Copies 1-3 of check, Copies 1-3 of DV, Copy 3 of
ALOBS and originals of supporting documents to Cashier for
review and signature.
Cashier 15 Verifies completeness of signature on the DV. Reviews the

amount of the check against the DV and supporting
documents. Signs the check.
Authorized 16 Countersigns check. Forwards Copies 1-3 of check, Copies

Official 1-3 of DV, Copy 3 of ALOBS and supporting documents to
the Receiving/Releasing Staff for return to the Cashier.
Receiving/ 17 Records in the logbook the date of release of Copies 1-3 of
Releasing Staff check, Copies 1-3 of DV, Copy 3 of ALOBS and supporting
documents.
Cashier 18 Releases the original of check and Copy 3 of DV to the

payee. Attaches OR/Invoice on Copy 1 of DV. Files Copies
2-3 of check, Copies 1-2 of DV, originals of supporting
documents.
C. Preparation of Report of Checks Issued (RCI)
Daily,
19 With Copies 1-2 of DV, Copy 3 of ALOBS, supporting
documents, Copies 2-3 of checks, prepares RCI in two
copies.
Note 6:
RCI shall include only those checks actually released to the
payees during the day including cancelled ones.
Note 7:
The RCI shall be distributed as follows:
Original - Accounting Unit together with the originals of
the paid DVs/payroll and supporting
documents for JEV preparation
Head of the 21 Reviews RCI and signs in ‘Certification’ portion.

Cash Unit
Designated Staff 22 Forwards original of RCI together with Copy 2 of checks,
Copy 1 of DVs, Copy 3 of ALOBS and supporting documents
to the Accounting Unit for the preparation of JEV. Retains
Copy 2 of RCI, Copy 3 of checks and Copy 2 of DVs for file.
Note 8:
The “List of Unreleased Checks” shall be attached to the RCI
to be submitted to Accounting Unit for reference.
Area of Seq
No.
D. Preparation of JEV
Accounting Unit Daily

Receiving/ 23 Records receipt of Copy 1 of RCI together with Copy 2 of
Releasing Staff checks, Copy 1 of DVs, Copy 3 of ALOBS and originals of
supporting documents from Cash Unit in the logbook.
Forwards the documents to the Designated Staff for JEV
preparation.
Designated Staff 24 Examines DVs and checks against RCI. Verifies if the serial
number of checks actually issued, including spoiled and
cancelled ones, are all accounted for.
25 Prepares JEV in two copies and signs in the “Prepared by”

portion.
Head of the 26 Reviews correctness of the journal entries and signs on

Accounting ‘Certified Correct by’ portion of the JEV. Forwards Copies
Unit/Authorized 1-2 of JEV and Copy 1 of RCI, Copy 2 of checks, Copy 1 of
Signatory DVs, Copy 3 of ALOBS and originals of supporting
documents to Designated Staff for recording in the Check
Disbursements Journal (CkDJ).
E. Recording in the CkDJ
Designated Staff 27 Receives Copies 1-2 of JEV and Copy 1 of RCI, Copy 2 of
checks, Copy 1 of DVs, Copy 3 of ALOBS and supporting
documents. Records the JEV in the CkDJ. Retains Copy 2
of JEV for file. Forwards Copy 1 of JEV, RCI and DV, Copy
2 of checks, Copy 3 of ALOBS and supporting documents
to the Receiving/Releasing Staff for submission to COA for
audit.
Receiving/ 28 Records in the logbook the date of submission of Copy 1 of

Releasing Staff JEV, RCI, DVs, Copy 3 of ALOBS, Copy 2 of checks and
originals of supporting documents. Forwards the documents
to COA for audit.
Note 9:
Disbursements by Cash. Disbursements by cash shall be made from cash

advances drawn and maintained in accordance with COA rules and regulations. Cash
payments shall be made based on duly approved payrolls/disbursements vouchers.
Cash Advances for Travel. Cash advances granted for travel shall be accounted
for as Due from Officers and Employees and these are subject to liquidation upon travel
completion. For liquidation of travel where the amount of cash advance is equal to or more
than thetravel expenses incurred, the Liquidation Report form shall be prepared by the
officers/employees concerned and submitted to the Accounting Unit as basis for JEV
preparation. The excess cash advance shall be refunded and an OR shall be issued to
acknowledge receipt thereof. In case the amount of cash advance is less than the travel
expenses incurred, a Liquidation Report shall be submitted to liquidate the cash advance
previously granted and a DV shall be prepared to claim reimbursement of the deficiency in
amount.
Procedures in Disbursements Cash - Payment for Payroll and Other Expenses
Area of Seq
No.
Cash Unit
Accountable/ 1 Receives the approved check from the Cashier. Records in
Disbursing the Cash Disbursements Record (CDR) the date,
Officer reference, name of payee, particulars and the amount of
check in the debit column.
2 In-cashed check in a GSB.
3 Pays officials and employees/other payees.
Note 1
Employees/payees shall sign on the received portion of the
payroll/DV to acknowledge receipt of payment.
Note 2
If there are unclaimed salaries, refund the same within a
reasonable time. OR representing the refund shall be
issued by the Cashier.
4 Records payment including the refund for unclaimed salary

in the credit column of the CDR.
At the End of the Month
5 Based on the paid payroll/DV and supporting documents,

prepares Report of Disbursements (RD) in two copies.
Signs the “Certification” portion of the RD.
Note 3
The RD shall serve as the liquidation report of the cash
advance granted to the Disbursing Officer.
Note 4
The RD shall be distributed as follows:
Original - Accounting Unit together with the originals of
the paid DVs/Payrolls and supporting documents
for JEV preparation
Accounting Unit
Releasing/ 6 Records in the logbook, indicates ‘Received’ and signs all
Receiving copies, forwards the RD to the Bookkeeper for JEV
Clerk preparation, and returns Copy 2 to the Cash Unit.
Bookkeeper 7 Prepares JEV based on the RD and supporting documents

received.
Note 5
For the succeeding activities, refer to Sec.71, Preparation
8 Records payroll payment in the individual Index of

Payments (IP) of officials and employees.
Disbursements Through Bank - Payroll Payment
Area of Seq
No.
Cash Unit
Cash Staff 1 Receives the approved check, DV and Following Months'
Payroll (FMP), signs the logbook of the releasing office, and
forwards the documents to the Cashier.
2 Deposits the check to the Bank Payroll Account together
with the original of the Summary of Employees Net
Earnings (SENE) received from Accounting Unit. Files
temporarily Copies 1-2 of FMP, copy 2 of the check, and
Copies 1-3 of DV for the preparation of RCI.
Note 1
The payee of the check is the Servicing Bank whose
authorized representative shall acknowledge receipt of the
check by signing on the original of the DV.
Note 2
Refer to Seq. No. 19, Sec.34, Procedures for
Disbursements by Checks.
Note 3
Payroll payment through bank shall also be recorded in the
IP maintained by the Accounting Unit.
Petty Cash Fund Disbursements. Petty Cash Fund shall be maintained under
the imprest system. The fund shall be sufficient for the non-recurring, emergency and petty
expenses of the agency. Disbursements from the fund shall be through the Petty Cash
Voucher(PCV) which shall be approved by authorized officials and signed by the payee to
acknowledge the amount received. The official receipt or its equivalent is attached to the
PCV.
Procedures in Disbursements Through Petty Cash Fund
Area of Seq
No.
Receipt of Check for the Establishment/ Replenishment of

Various Unit Petty Cash Fund
Petty Cash
Custodian 1 Receives check from Cashier for the
establishment/replenishment of petty cash fund. Retrieves
Cash Disbursement Record (CDR) and records the date,
reference and the amount of check in the ‘Disbursements’
column.
2 In-cashed check in GSB and keeps the cash in a safety

vault.
Utilization of Petty Cash Fund
Requesting 3 Accomplishes Box A ‘Requested by’ portion of the Petty

Personnel Cash Voucher (PCV).
Immediate 4 Signs Box A ‘Approved by’ portion of the PCV and returns
Supervisor to Requesting Personnel.
Area of Seq
No.
Requesting 5 Submits to the Petty Cash Custodian for the release of

Personnel fund.
Petty Cash 6 Receives from the Requesting Personnel the PCV duly
Custodian approved by concerned official.
7 Upon granting of the petty cash advance and signs in Box

B ‘Paid by’ portion of the PCV.
Requesting 8 Receives petty cash and signs in Box B ‘Cash Received by’
Personnel portion of the PCV.
Petty Cash 9 Issues Copy 2 of the PCV to requesting personnel

Custodian
10 Retrieves CDR from file and records paid PCVs. Fills up the
following columns: date, reference, name of payee, nature
of payment, amount in the credit column and cash advance
balance.
11 Files the original of PCV awaiting liquidation.

Liquidation of Petty Cash Advance
12 Receives from Requesting Personnel Copy 2 of the PCV
together with supporting documents. Checks and reviews
completeness of documents such as the date, amount and
nature of expenses paid as shown in the supporting
documents.
If incomplete, returns to Requesting Personnel for

completion of needed supporting documents.
13 If complete, retrieves the original of PCV from file and fills

up Box D ‘Liquidation Submitted portion of the original and
Copy 2 of PCVs.
14 Checks the appropriate boxes for ‘Received Refund’ or

‘Reimbursement Paid’ portion and signs Box C of the PCV.
Requesting 15 Checks and fills up the appropriate boxes for ‘Liquidation

Personnel Submitted’ and ‘Reimbursement Paid’ upon submission of
necessary supporting documents and receipt or
reimbursement of cash, if any, and signs the PCV.
Petty Cash 16 Returns Copy 2 of the PCV to the Requesting Personnel.

Fund
Custodian
Area of Seq
No.
17 If the amount granted is equal to the amount paid as shown

in the liquidated PCV, proceeds to Sequence No. 18.
If the amount is not equal to the amount paid, retrieves

from file the CDR and records the necessary adjustments
based on the liquidated PCV. Fills up the following
columns: date, reference, name of payee, and nature of
payment, amount in the appropriate debit, credit and
balance columns.
18 Files the original of the PCV together with the supporting

documents awaiting replenishment.
Replenishment of Petty Cash Fund

Retrieves from file the original of the PCV together with the
Petty Cash 19 supporting documents. Checks the completeness of all
Fund PCVs for replenishment.
Custodian
20 Prepares the Petty Cash Replenishment Report (PCRR) in

two copies based on PCVs in numerical sequence and fills
up the following columns: date, PCV No., particulars and
amount.
21 Signs in the ‘Certified Correct by’ portion of the PCRR.
22 Based on the PCRR, prepares DV in three copies.

Forwards Copies 1-3 of the DV, original of the PCRR and
PCV, and supporting documents to Authorized Official for
review and signature.
Authorized 23 Signs in Box A portion of the DV.

Official
Petty Cash 24 Forwards Copies 1-3 of the DV, originals of PCRR and
Fund PCVs and supporting documents to Budget Division for
Custodian preparation of the ALOBS.
Note 1
For the succeeding activities, refer to Sec.15, Procedures
in the Recording of Obligations.
G. PROPERTY, PLANT AND EQUIPMENT, AND INVENTORY ACCOUNTS
Purchase or Construction of Property, Plant and Equipment. Property, plant

and equipment acquired through purchase shall include all costs incurred to bring them to
the location necessary for their intended use, like transportation costs, freight charges,
installation costs, etc. These are recorded in the books of accounts as Assets after
inspection and acceptance of delivery.
During construction period, property, plant and equipment shall be classified and
recorded as “Construction in Progress” with the appropriate asset classification. As soon
as these are completed, the "Construction in Progress" account shall be transferred to the
appropriate asset accounts.
Accounts “Public Infrastructures” and “Reforestation Projects” are closed to

“Government Equity” account and the asset is recorded in the Registry of Public
Infrastructures/Reforestation Projects at the end of the year.
Property and Inventory Accounting System. The Property and Inventory Accounting
System consists of the system of monitoring, controlling and recording of acquisition and
disposal of property and inventory.
The system starts with the receipt of the purchased inventory items and equipment.
The requesting office in need of the inventory items and equipment after determining that
the items are not available in stock shall prepare and cause the approval of the Purchase
Request (PR). Based on the approved PR and after accomplishing all the required
procedures adopting a particular mode of procurement, the agency shall issue a duly
approved Purchase Order. Procedures relative to the obligation of the purchase order and
payment of the deliveries are discussed under Sections 14 and 31, Accounting for
Obligation and Disbursements by Check, respectively.
The sub-systems are as follows:
1. Receipt, Inspection, Acceptance and Recording Deliveries of Inventory Items

and Equipment
2. Requisition and Issuance of Inventory Items
3. Requisition and Issuance of Equipment
Perpetual Inventory Method. Purchase of supplies and materials for stock, regardless
of whether or not they are consumed within the accounting period, shall be recorded as
Inventory account. Under the perpetual inventory method, an inventory control account is
maintained in the General Ledger on a current basis.
Regular purchases shall be recorded under the Inventory account and issuance
thereof shall be recorded based on the Report of Supplies and Materials Issued.
Purchases out of the Petty Cash Fund shall be charged immediately to the appropriate
expense accounts.
The Accounting Unit shall maintain perpetual inventory records such as: Supplies
Ledger Cards for each inventory stock, Property, Plant and Equipment Ledger Cards for
each category of plant, property and equipment including work and other animals,
livestock, etc. Subsidiary ledger cards shall contain the details of the General Ledger
accounts.
For check and balance, Property and Supply Office/Unit shall maintain Property
Cards (PC) for property, plant and equipment, and Stock Cards (SC) for inventories. The
balance in quantity per PC and SC should always reconcile with the ledger cards of the
Accounting Unit.
Moving Average Method. Moving average method of costing shall be used for costing
inventories. This is a method of calculating cost of inventory on the basis of weighted
average on the date of issue. The Accounting Unit shall be responsible in computing the
cost of inventory on a regular basis.
Procedures in Receipt, Inspection, Acceptance and Recording Deliveries of

Inventory Items and Equipment
Area of Seq
No.
Property and Delivery of Equipment and Inventory Items

Supply Unit
Property/ Signs “Received” portion of the original and Copy 2 of the
Supply Officer 1 Delivery Receipt (DR). Files the original and returns Copy
2 of the DR to the Supplier/Procurement Service.
Area of Seq
No.
2 Prepares Inspection and Acceptance Report (IAR) in three

copies. Forwards IAR, original of DR, and Copy 2 of
approved PO from file to Property Inspector for inspection
of deliveries.
Note 1
Distribution of the IAR shall be as follows:
Original - Supplier (to be attached to the DV)
Copy 2 - Property Inspector/
Inspection Committee
Copy 3 - Property and Supply Unit file
Property 3 Inspects and verifies items as to quantity and conformity

Inspector with specifications based on the DR and approved PO. If in
order, signs and indicates date of inspection in the
“Inspection” column of the IAR. Retains copy 3 of IAR and
forwards the items and Copy 1-2 of IAR, original of DR and
Copy 2 of PO to Property/Supply Officer for acceptance.
4 If specifications are not in order or delivery is not complete,

indicates notation on the IAR that the deliveries are not in
conformity with specifications agreed under the approved
PO or deliveries are not complete. Forwards the IAR to the
Property/Supply Officer.
Property/Supply 5 Signs in ‘Acceptance’ column, acknowledging receipt of the

Officer items delivered. Checks the appropriate box whether
complete or partial (indicate quantity received) delivery,
and indicate the date of receipt and remarks, if any.
Forwards items to Property/Supply Custodian for safe-
keeping/storage.
6 Prepares DV indicating the Supplier as Payee. Attaches the
original IAR, Copy 2 of DR, PO and photocopy of PR.
Forwards documents to Budget Unit for the preparation of
ALOBS. Forwards copy 2 of IAR and copy of PO to the
Property/Stock Card Keeper for recording in the Property/
Stock Cards.
Note 2
For succeeding activities on processing of payment for
delivered inventory items and equipment, refer to Sec.15,
Procedures in the Recording of Obligations and Sec. 34
Procedures in Disbursements by Checks.
Note 3
For purchases made through the Procurement Service
(PS), the DV shall be prepared on the basis of the Approved
Agency Procurement Request. The payment shall be made
directly to the PS.
Accounting Unit After Payment of Deliveries

PPELC/SLC
Keeper 7 Posts necessary information to the Property, Plant and
Equipment Ledger Card (PPELC)/Supply Ledger Card
(SLC) based on the paid documents forwarded by the Cash
Unit.
Procedures in Requisition and Issuance of Inventory Items

Area of Seq
No.
Concerned Office Inquiry for the availability of supplies

Requesting
Personnel 1 Prepares the Supplies Availability Inquiry (SAI) in two
copies. Accomplishes the form for item description, unit
and quantity.
2 Fills up the ‘Inquired by’ portion of SAI and forwards the

same to Accounting Unit for processing.
Accounting Unit
Accounting Staff 3 Receives SAI from Requesting Personnel. Reviews and
verifies the completeness of information.
4 Retrieves from file the SLC and determines
availability/status of stocks.
5 Fills up the number, stock number, status of stock and

‘Status provided by’ portion of the SAI. Returns the original
to the Requesting Personnel and files Copy 2 of the SAI.
Concerned Office
Requesting Receives the original of SAI from the Accounting Staff. If
Personnel 6 stock is not available, prepares Purchase Request (PR) for
the item requested and forwards the same to Property and
Supply Unit for processing of the request. If stock is
available, prepares Requisition and Issue Slip (RIS) in
three copies. Fills up all the necessary information except
for the issuance portion and signs ‘Requested by’ portion
of the RIS. Forwards the RIS to Authorized Official for
approval.
Note 1
The RIS shall be distributed as follows:
Original - Accounting Unit
Copy 2 - Property and Supply Unit
Copy 3 - Requesting Office
Authorized 7 Signs the ‘Approved by’ portion of the RIS.

Official
Requesting 8 Receives signed RIS and forwards to the Property and
Personnel Supply Unit together with the original of SAI for withdrawal
of inventory items requested.
Property and
Supply Unit Reviews and verifies RIS as to completeness of
Supply Officer 9 information. Fills up the RIS No./Date, and Quantity,
Remarks and initials ‘Approved by’ portion of the RIS, and
records RIS in the logbook.
Head of the 10 Signs the ‘Approved by’portion of RIS and returns to the
Property and Supply Officer for issuance of the stock.
Supply Unit
Supply Officer 11 Fills up and signs the ‘Issuance’ portion of the RIS and
issues inventory items requested to the Requesting
Personnel.
Concerned Office
Requesting 12 Receives supplies requested and sign in the ‘Received by’
Personnel portion of the RIS.
Area of Seq
No.
13 Files permanently in numerical order Copy 2 of RIS and

files temporarily the originals of RIS and SAI for the
preparation of Report of Supplies and Materials Issued
(RSMI).
Preparation of RSMI
14 Retrieves the original copies of RIS and SAI from

temporary file. Checks the completeness of the RIS. If not
complete, verifies with the Supply Officer. If complete,
prepares RSMI in three copies.
15 Initials in the ‘Certified by’ portion of the RSMI.

Property and
Supply Unit
Head of the 16 Signs in the ‘Certified by’ portion of the RSMI.
Property and
Supply Unit
Stock Card 17 Receives signed RSMI and forwards to Accounting Unit the
Keeper original and Copy 2 of RSMI together with originals of RIS
and SAI. Files Copy 3 of RSMI.
At the Start of the Day

Accounting Unit
Accounting Staff 18 Receives original and Copy 2 of RSMI and, original SAI and
RIS. Checks and verifies the completeness of information.
Retrieves SLC from file and fills up the ‘To be filled up in
the Accounting Unit’ portion of RSMI. Records RSMI in the
SLC.
19 Signs in the ‘Posted by/date’ portion of the RSMI.

20 Files permanently in numerical order Copy 2 of RSMI and
files temporarily the original RIS, SAI and RSMI for
recording issuance of inventory items in the books of
accounts.
At Month End
21 Retrieves the original RIS, SAI and RSMI from temporary

file.
22 Prepares JEV in two copies based on the RSMI to record

the issuance of stock.
23 Signs in the ‘Prepared by’ portion of the JEV.
Head of the 24 Sign in the ‘Certified Correct by’ portion of the JEV.
Accounting
Unit
Accounting Staff 25 Receives signed JEV and forwards to Bookkeeper the JEV,
RSMI, RIS, and SAI for recording in the General Journal.
Files copy 2 of JEV.
Note 2:
For succeeding activities, refer to Sec. 71, Preparation and
Submission of Trial Balances and Other Reports.
Procedures in Requisition and Issuance of Equipment
Area of Seq
No.
Concerned Office
Requesting
Personnel 1 Upon receipt of notice of availability of the equipment
requested, prepares RIS in three copies.
Fills up the necessary information pertaining to requisition,

except ‘Issuance’ column of the RIS.
Authorized 2 Reviews RIS and signs ‘Requested By’ in the Requisition

Official column.
Requesting 3 Records the signed RIS in the logbook and indicate date,
Personnel particulars and remarks. Forwards the same to Property
and Supply Unit for processing of the requisition.
Property and
Supply Unit
Receiving Staff 4 Receives signed RIS from Requesting Office. Records the
date, particulars and Requesting Office in the logbook.
Assigns number on RIS and issues Copy 3 to Requesting
Personnel for file.
Property Officer 5 Verifies RIS and checks against the PR.
6 Initials RIS and forwards the original and Copy 2 of RIS to

the Head of the Property and Supply Unit for review and
approval.
Head of the 7 Reviews RIS and signs the ‘Approved By’ portion of RIS.
Property and Forwards Copies 1-2 of RIS to Property Custodian.
Supply Unit
Property 8 Based on the approved RIS, assigns number on the
Custodian property being transferred/ issued. Indicates the number
in the RIS.
9 Prepares Acknowledgment Receipt of Equipment (ARE).

Indicates the quantity, unit, description and property
number of the items being issued. Signs in the ‘Received
from’ and ‘Issued by’ portions of the ARE and RIS,
respectively. Records the date, number and particulars in
the ARE logbook.
Note 1
ARE shall be distributed as follows:
Original - Property and Supply Unit file
Copy 2 - Recipient or user of the property file
Concerned Office
Requesting 11 Retrieves Copy 3 of RIS. Checks item if it is in conformity
Personnel with RIS. Signs ‘Received By’ portion of original and Copy
2 of ARE and RIS.
12 Returns original ARE and Copies 1-2 of RIS to Property

Custodian/Officer for recording in the Property Card. Files
Copy 2 of ARE and Copy 3 of RIS.
Supply and
Property Unit
Area of Seq
No.
Property Officer 13 Files original of ARE per accountable officer/employee

and Copy 2 of RIS. Forwards the original RIS to the
Accounting Unit.
Accounting Unit 14 Receives original of the RIS. Retrieves the PPELC and
PPELC Keeper posts information pertaining to issuance/transfer of
property.
E. MISCELLANEOUS TRANSACTIONS
Miscellaneous Transactions. Miscellaneous transactions are transactions types that are

unique and not recurring in the ordinary course of government operations. These seldom
take place or should not happen at all. Some of the miscellaneous transactions are as
follows:
1. Loss of Cash and Property

2. Request for Relief from Accountability
3. Cash Overage
4. Stale MDS and Commercial Checks
5. Set-up and Settlement of Disallowances
6. Refund of Overpayments
Accounting for Loss of Cash and Property. Loss of cash and property may be due to,
theft, robbery, fortuitous event or other causes.
Cash shortage discovered during cash examination conducted by auditors is

reported through the Report of Cash Examination. The Auditor issues an audit report in
case of shortage in property accountability. As soon as a shortage is definitely established,
the Auditor shall issue a memorandum pertaining thereto and the Accountant shall draw
a JEV to record the shortage as a receivable from the Accountable Officer concerned.
In case of loss of property due to other causes like, theft, force majeure, fire, etc.,
a report thereon shall be prepared by the Accountable Officer concerned for purposes of
requesting relief from accountability. No accounting entry shall be made but the loss shall
be disclosed in the notes to financial statements pending result of request for relief from
accountability.
Grant of Relief from Accountability. When a request for relief from accountability for
shortages or loss of funds is granted, a copy of the decision shall be forwarded to the
Chief Accountant who shall draw a JEV to record the transaction. The loss shall be debited
to the Loss of Assets account and credited to the appropriate receivable account. In case
the request for relief is denied, immediate payment of the shortage shall be demanded
from the Accountable Officer. Restitution shall be acknowledged by the issuance of an
official receipt.
In case the request for relief from accountability for loss of property caused by fire,
theft, force majeure or other causes is granted, a copy of the decision shall likewise be
forwarded to the Chief Accountant for the preparation of the JEV. The loss shall be debited
to the Loss of Assets account and credited to the appropriate asset account. If request
for relief from accountability is denied, the loss shall be taken up as a receivable from the
Accountable Officer or employee liable for the loss and shall be credited to the appropriate
asset account.
Accounting for Cash Overage. In case the cash examination disclosed cash overage,
as determined by the Auditor during cash examination, the amount shall be forfeited in
favor of the government and an official receipt shall be issued by the Cashier. The cash
overage shall be taken up as Miscellaneous Income.
Accounting for Stale Checks. Checks may be cancelled when they become stale. The
depository bank considers a check stale, if it has been outstanding for over six months
from date of issue or as prescribed.
reported in the RC
A stale check shall be marked cancelled on its face and reported as follows:
1. Unclaimed stale checks which are still with Cashier shall be cancelled and
reported in the List of Unreleased Checks as cancelled. The List of Unreleased
Checks is attached to the RCI.
2. For stale checks which are in the hands of the payees or holders in due course
and requested for replacements, new checks may be issued upon submission
of the stale checks to the Accounting Unit. A certified copy of the previously
paid DVs shall be attached to the request for replacement. A JEV shall be
prepared to take up the cancellation. The replacement check shall be reported
in the RCI.
Accounting for Disallowances. Disallowances shall be taken up in the books of

accounts only when they become final and executory. The Accountant shall prepare the
JEV to take up the Receivable-Disallowances/Charges and credit the appropriate expense
account for the current year or Prior Years’ Adjustment account if pertaining to expenses
of previous years.
Cash settlement of disallowances shall be acknowledged through the issuance of an

official receipt and reported by the Cashier in the RCD.
Accounting for Overpayments. Sometimes overpayments or even double payment of

expenditures do happen in agencies. These could be avoided with the institution of proper
controls but some could not be avoided because of built-in procedures. One example is
the payment of payrolls. Payrolls are prepared in advance and some agencies pay their
employees through the banking system. All these are done before reports of attendance
are submitted, making it impossible to know the exact amount to be paid in case there are
absences without pay during the pay periods. In case of overpayments, refunds shall be
demanded of the employees concerned.
Pro-forma Accounting Entries. The following are the pro-forma accounting entries for
miscellaneous transactions:
Acct.
Particulars Account Title Code Dr. Cr.
1. Cash Shortage
a. Cash shortage of the Disbursing Officer
To take up cash Due from Officers and Employees 128 150
Shortage Cash-Disbursing Officers 107 150
b. Cash Shortage of the Collecting Officer
To take up cash Due from Officers and Employees 128 150
Shortage Cash-Collecting Officers 106 150
2. Relief from Accountability for Loss of Government Funds and Property
a. Request for Relief from Accountability Granted.
To take up relief from

accountability
for current year - - Loss of Assets 948

or
Acct.
for prior years - - Prior Years’ Adjustments 533 50
Due from Officers and Employees

128 50
b. Request for Relief from Accountability Denied.
To record the loss of fund Due from Officers and Employees 128 150
by a Disbursing Officer Cash-Disbursing Officers 107 150
(allegedly thru theft ) -
P150
c. Cash Settlement/Restitution in case of denial of Request for Relief from Accountability
To take up receipt of Cash-Collecting Officers 106 50

settlement Due from Officers and Employees
128 50
To record deposit
c.1 current year Subsidy Income from National 601 50
Government
Cash-Collecting Officers 106 50
c.2 prior year Prior Years’ Adjustment 533 50

3. Cash Overage
To take up cash overage Cash – Collecting Officers 106 50

discovered during cash Due to National Treasury 433 50
examination Miscellaneous Operating
and Service Income 50
To record deposit Due to National Treasury 433 50

Miscellaneous Operating
and Service Income 50
4. Stale Checks
a. Stale MDS check issued in the current year for replacement
Check cancellation Cash-National Treasury, MDS 102 50

Accounts Payable 401 50
Replacement Accounts Payable 401 50

Cash-National Treasury, MDS 102 50
b. Stale MDS check issued in the prior years for replacement
Check cancellation Prior Years’ Adjustments 533 50


Cash-National Treasury, MDS 102 50
c. Stale commercial check issued in the current and prior years for replacement
Check cancellation Cash in Bank-Local Currency, Current

Account 110 50

Cash in Bank-Local Currency, Current
Account 110 50
Acct.
5. Disallowances
a. Recording of disallowances for current year’s transaction
When the disallowances

becomes final and Receivables-Disallowances/ Charges
executory - overpayment of Office Supplies Expenses 1388 10
office supplies 49 10
Amount paid - P100

Should be - 90
Difference - 10
Settlement of Disallowance Cash-Collecting Officers 106 10

Receivables-Disallowances/ Charges
138 10
Deposit of collection Subsidy Income from National

Government 601 10
Acct.
Particulars Account Title Code Debit Credit
b. Recording of disallowance for prior year’s transaction
When the disallowance Receivables - Disallowances/ Charges

becomes final and Prior Years’ Adjustments 1385 10
executory 33 10
Settlement of disallowance Cash - Collecting Officers 106 10

Receivables - Disallowances/ Charges
138 10
Deposit of collection Prior Years’ Adjustments 533 10
6. Refund of Overpayment
a. Overpayment taken up as receivable
To record overpayment of Due from Officers and Employees 128 10

salaries and wages Salaries and Wages - Regular Pay
(When overpayment is 801 10
ascertained)
To record receipt of refund Cash-Collecting Officers 106 10

Due from Officers and Employees
128 10

Government 601 10
b. Refund of overpayment not taken up as receivable
To record receipt of refund Cash - Collecting Officers 106 10

of Salaries and Wages - Salaries and Wages – Regular Pay
Regular Pay during the 801 10
current year
Acct.
Particulars Account Title Code Debit Credit
Government 601 10
To record receipt of refund Cash-Collecting Officers 106 10

of 0verpayment in the Prior Years’ Adjustments 533 10
ensuing year
Deposit of collection Prior Years’ Adjustments 533 10

Chapter 5. Trial Balances & Financial Statements

Financial Reporting System. Financial Reporting System (FRS) includes the
preparation and submission of trial balances, financial statements and other reports
needed by fiscal and regulatory agencies. The sub-systems are as follows:
1. Preparation and Submission of Trial Balances and Other Reports

2. Preparation and Submission of Financial Statements
Trial Balance. Trial Balance shows the equality of debit and credit balances of all
general ledger accounts as of a given period. It is prepared and submitted monthly,
quarterly and annually. At the end of the fiscal year, the pre-closing and the post-closing
trial balances shall be prepared.
Purposes of the Trial Balance. Trial balance is prepared to:
1. prove the mathematical equality of the debits and credits after posting;
2. find out errors in journalizing and posting; and
3. serve as basis for the preparation of the financial statements.
Pre-Closing Trial Balance. Pre-Closing Trial Balance (Appendix 2) shall be

prepared after recording the adjusting journal entries in the General Journal and posting
the same to the General Ledger. It shows the adjusted balances of all accounts as of a
given period. This is also described as the adjusted trial balance.
Adjusting or Correcting Journal Entries. Under the matching principle,

adjustments shall be made for economic activities that have taken place but are not yet
recorded at the time when the financial statements are prepared. Such adjusting journal
entries are made to ensure that revenues and expenses are recorded in the period when
they are earned or incurred. Adjustments are of two main types: accrued items and
deferred items.
Adjustment for Accrued Item. It is an adjusting entry for an economic activity

already undertaken but not yet recorded into an asset and revenue accounts or a liability
and expense accounts. It requires asset/revenue adjustments and liability/expense
adjustments.
Asset/Revenue Adjustment. It involves earned revenues not yet recorded as

assets and income at the end of the accounting period. Examples are receivables for
revenues already earned but not yet collected nor billed as of the year end.
Account
Account Title Code Debit Credit
Interest Receivable 161 500

Interest Income 624 500
Liability/Expense Adjustment. It involves expenses, which already exist but remain

unpaid at the end of the accounting period. Examples are salaries, wages and other
expenses already incurred but not yet paid.
Account
Salaries and Wages-Regular Pay 801 1,000
Due to Officers and Employees 428 1,000
Adjustment for Deferred Items. These are adjusting entries transferring data previously
recorded in an asset account to an expense account, or data previously recorded in a
liability account to a revenue account. It also requires asset/expense adjustments and
liability/revenue adjustments.
Asset/Expense Adjustments. These pertain to assets, portion of which shall be recorded

as expense of the agency at the end of the accounting period. Examples are prepaid
expenses, bad debts and depreciation.
Account
Original Entry:
Prepaid Rent 161 1,000
Cash-National Treasury, MDS 102 1,000
Adjusting Entry:
Rent Expenses 841 900
Prepaid Rent 161 900
Bad Debts. Trade receivables shall be valued at their face amounts minus, whenever
appropriate, allowance for doubtful accounts. Bad Debts expense and/or any anticipated
adjustments, which in the normal course of events will reduce the amount of receivables
from the debtors to estimated realizable values, shall be set up at the end of the accounting
period.
Allowance for Doubtful Accounts shall be provided in an amount based on

collectability of receivable balances and evaluation of such factors as aging of the
accounts, collection experiences of the agency, expected loss experiences and identified
doubtful accounts.
Determination of bad debts expense shall be derived from computations based on

percentages and aging of accounts receivable as follows:
Age of Accounts Percentage
1 - 60 days 1%
61 - 180 days 2%
181- 1 year 3%
More than 1 year 5%
An adjusting journal entry to take up bad debts expense is as follows:
Accoun
Account Title t Code Debit Credit
Bad Debts 929 1,000
Allowance - Doubtful Accounts 301 1,000
Depreciation for Property, Plant and Equipment. Costs of property, plant and
equipment are allocated to the periods benefited through the provision of accumulated
depreciation. Depreciation is the systematic and gradual allocation of the depreciable
amount of asset over its useful life. The depreciable or estimated useful life for different
types of assets are presented as Appendix 1.
Method of Depreciation. Depreciation shall be computed using the Straight Line

Method. Depreciation shall start on the second month from purchase. A residual value
equivalent to ten percent of the cost shall be set. Annual depreciation is computed as
follows:
Annual Depreciation = Asset Cost less Estimated Residual/ Salvage Value
Estimated Useful Life
Asset Cost - Purchase or Acquired Value of the Asset

Estimated Salvage Value - 10% of the asset cost
Estimated Useful Life - Estimated number of years the asset shall be used as
determined by the Commission on Audit
A sample adjusting journal entry for depreciation expense is as follows:
Acco
Account Title unt Debi Cred
Code t it
Depreciation-Office 922 1,00

Equipment 0
Accumulated Depreciation- 322 1,00
Office Equipment 0
Closing Journal Entries. Closing journal entries are general journal entries which close
out the balances of all nominal/ temporary and intermediate accounts at the end of the
accounting period. The nominal and intermediate accounts that shall be closed at the end
of the accounting period are as follows:
1. Reversion of the unused or unutilized Subsidy Income from National

Government at the end of the year due to the DBM policy that NCA will only be
valid within the year of issue except NCA for accounts payable, which is valid
one month after its issuance. There is no need to issue an MDS Check when
reverting the account.
Account
Subsidy Income from National 601 100

Government
Cash-National Treasury, 102 100
MDS
2. Close the balance of the Subsidy Income from National Government account
to Income and Expense Summary account.
Account
Subsidy Income from National 601 1000
Government
Income and Expense 532 1000
Summary
3. Close the balance of all income accounts to Income and Expense Summary
account.
Account
Account Title Code Debit Credi
t
Income from Government 611 500
Services
Income from Government
Business Operations 612 400
Summary
4. Close the balance of all expense accounts to Income an Expense Summary

account.

Summary
Salaries and Wages- 801 800
Regular Pay
5. Close the balance of the Income and Expense Summary Account to the
Retained Operating Surplus account.
Income and Expense 532 1,10

Summary 0
Retained Operating 534 1,10
Surplus 0
5. Close the balance of the Prior Year’s Adjustments account to Retained

Operating Surplus account.
Prior Years’ Adjustments 533 200

Retained Operating 534 200
Surplus
6. Close the balance of the Retained Operating Surplus to Government Equity

account.
Retained Operating Surplus 534 1,300

Government Equity 501 1,300
7. Close Public Infrastructures or Reforestation Projects accounts to

Government Equity account and transfer the corresponding amounts to the
respective registries.
Government Equity 501 1,300

Public Infrastructures/ 243/
Reforestation Projects 244 1,300
Post-Closing Trial Balance. Post-Closing Trial Balance (Appendix 3) shall be

prepared after recording the closing journal entries in the General Journal and posting to
the General Ledger. It contains a listing of all general ledger accounts that remain open
after the closing process is completed.
Procedures in Preparation /Submission of Trial Balances and Other Reports
Area of Seq.
Responsibility No. Activity
Preparation of Unadjusted Trial Balance

Accounting Unit
Bookkeeper 1 Records JEVs for the month in the Special Journals and
General Journal.
2 Posts the journal entries from the Special Journals and

General Journal to the respective General Ledgers.
3 Records the source/summarizing documents to the

respective Subsidiary Ledgers.
Note 1
The summarizing/source documents are the following:
 Report of Checks Issued (RCI)
 Report of Collections and Deposits (RCD)
 Report of Disbursements (RD)
Area of Seq.
 Journal Entry Voucher (JEV)

 Disbursement Voucher (DV)
 Other Supporting Documents (OSD)
4 Foots and extracts the balances of the General Ledgers and

Subsidiary Ledgers.
5 Based on the General Ledgers, prepares the Unadjusted
Trial Balance (UTB) to check the postings made on the
General Ledgers or the equality of debit and credit balances
of the general ledger accounts. Files temporarily.
Preparation of Pre-Closing Trial Balance
6 Prepares adjusting journal entries thru the JEV for

unrecorded transactions and for all accounts that need to be
adjusted/ corrected. Records the JEV in the General Journal.
Note 2
Adjusting journal entries shall be prepared for the following
transactions:
 Adjustment for Accrued Items

 Adjustment for Deferred Items
 Correction/Reclassification Entries
 Provision for Allowance for Doubtful Accounts
 Provision for Accumulated Depreciation
7 Posts the adjusting journal entries from the General Journal

to the General Ledgers and Subsidiary Ledgers.
8 Foots and extracts balances of the General Ledgers and

Subsidiary Ledgers.
9 Based on the General Ledgers, prepares Pre-Closing Trial

Balance in four copies. Files temporarily the Pre-Closing Trial
Balance.
Note 3
Use of a Worksheet to facilitate the preparation of the trial
balances is encouraged. The preparation of the Worksheet is
discussed in Sec. 82.
Note 4
The preparation of the adjusting journal entries is at month
end or as necessary.
Preparation of Other Reports
10 Reconciles the totals of the Subsidiary Ledgers with the totals

of the General Ledgers accounts. If unreconciled, checks the
difference and prepares adjusting/ correcting entries as
maybe necessary thru the JEV.
11 If reconciled, prepares individual supporting schedules per

account based on the Subsidiary Ledgers.
Area of Seq.
12 Initials the supporting schedules and the Pre-Closing Trial

Balance and forwards the same to the Head of the
Accounting Unit for review and signature.
Head of the 13 Reviews and signs the ‘Certified Correct’ portion of the Pre-
Accounting Closing Trial Balance and the supporting schedules.
Unit
Designated 14 Submits the Pre-Closing Trial Balance to the Offices
Staff concerned. Records submission in the logbook maintained.
Files Copy 4 of the Pre-Closing Trial Balance and Copy 4 of
supporting schedules for preparation of financial Statements.
Preparation of Post-Closing Trial Balance at year-end.
Bookkeeper 15 Prepares closing journal entries thru JEV and records the
same in the General Journal.
Note 5
The following accounts shall be closed/reverted at year-end:
 Unused Subsidy Income from National Government

(Balance of account Cash-National Treasury, MDS)
 Nominal/Intermediate Accounts
 Income accounts (including Subsidy Income from
National Government, RO and OU) to the Income
and Expense Summary (IES) account
 Expense accounts to IES account
 Prior Years’ Adjustments account to Retained
Operating Surplus (ROS) account
 Balance of IES account to ROS account
 ROS account to Government Equity account
.
Note 6
In addition to the closing journal entries, the account
Infrastructure Projects/ Reforestation Projects shall be
transferred at year- end to the Registry of
Infrastructures/Registry of Reforestation Projects.
16 Posts the journal entries from the General Journal in the

respective General Ledgers.
17 Foots and extracts the balances of the General Ledgers and

the Subsidiary Ledgers.
18 Based on the General Ledgers, prepares Post-Closing Trial

Balance in four copies.
19 Reconciles the supporting schedules with Post-Closing Trial

Balance. If not reconciled, prepares the necessary
corrections thru JEV. Records the JEV in the General
Journal.
20 Initials the ‘Certified Correct by’ portion of the Post-Closing

Trial Balance and ‘Prepared by’ portion of supporting
schedules.
Area of Seq.
21 Prepares transmittal letter and forwards the same together

with the Post-Closing Trial Balance and supporting schedules
to the Head of the Accounting Unit.
Head of the 22 Reviews and signs ‘Certified Correct by’ portion of the Post-
Accounting Closing Trial Balance, supporting schedules and transmittal
Unit letter, and forwards the same to the Accounting Staff for
distribution.
Accounting 23 Distributes the Post-Closing Trial Balance and supporting

Staff schedules to the Concerned Offices. Records in the logbook
the submission of the same.
Note 7
Trial Balances and supporting schedules shall be distributed
as follows:
Copy 1 – COA Resident Auditor
Copy 2 – Accountancy Office, COA
Copy 3 – DBM
Copy 4 – Accounting Unit File
Note 8
The frequency of submission of Pre-Closing Trial
Balance/Post-Closing Trial Balance and other reports shall
be as follows:
 Pre-Closing Trial Balance and other reports – monthly,

within ten days after the end of the month to the COA
Resident Auditor and DBM
 Year-end Pre-Closing Trial Balance/ Post-Closing Trial

Balance and other reports – on or before Feb. 14 of the
following year to the COA Resident Auditor, DBM and
COA, Accountancy Office.
Generation of Financial Statements and Supporting Schedules. Financial statements

and their supporting schedules are the products of the government accounting processes.
These are the principal comprehensive means by which the information accumulated and
processed in the state accounting system is periodically communicated to those who use
them. The financial statements generally prepared in the National Government are: the
Balance Sheet, Statement of Income and Expenses, Statement of Government Equity,
and Statement of Cash Flows.
Responsibility for Financial Statements. Responsibility for the fair

presentation and reliability of financial statements rests with the management of the
reporting agency. This responsibility is discharged by applying generally accepted state
accounting principles that are appropriate to the entity’s circumstances, by maintaining
effective system of internal control and by adhering to the chart of accounts prescribed by
the Commission on Audit.
To achieve fair presentation and reliable information of the financial statements,
the following standards shall be observed.
a. Fairness of presentation. This refers to the overall propriety in disclosing
financial information. Full disclosure in financial aspects requires observance
of the following standards of reporting:
All essential facts relating to the scope and purpose of each report and the
period involved shall be included and clearly displayed.
 All financial data presented shall be accurate, reliable, and truthful. The
requirement for accuracy does not rule out the inclusion of reasonable
estimates when the making of precise measurements is impracticable,
uneconomical, unnecessary, or conducive to delay. All appropriate steps
shall be taken to avoid bias, unclear facts, and presentation of misleading
information.
 Financial reports shall be based on official records maintained under an
adequate accounting system that produces information objectively and
discloses the financial aspects of all events or transactions taking place.
Where financial data or reports based on sources other than the
accounting systems are presented, their basis shall be clearly explained.
 The financial data reported shall be derived from accounts that are
maintained in all material respects on a consistent basis from period to
period; material changes in accounting policies or methods and their
effect shall be clearly explained.
 Consistent and non-technical terminology shall be used in financial
reports to promote clarity and usefulness.
b. Compliance. The report shall be in accordance with prescribed government
requirements and international accounting standards of reporting.
c. Timeliness. All needed reports shall be produced promptly to be of maximum
usefulness.
d. Usefulness. Financial reports shall be carefully designed to present
information that is needed and useful to reports users.
Statement of Management Responsibility for Financial Statements.
Statement of Management Responsibility for Financial Statements (Appendix 4) shall
serve as the covering letter in transmitting the agencies financial statements to the
Commission on Audit, Department of Budget and Management, other oversight agencies
and other parties. It shows the agency’s responsibility for the preparation and presentation
of the financial statements. The statement shall be signed by the Director of Finance and
Management Office or Comptrollership Office, or the Chief of Office who has direct
supervision and control over the agency’s accounting and financial transactions, and the
Head of Agency or his authorized representative.
Balance Sheet. Balance Sheet (Appendices 5 and 6) is a formal statement which
shows the financial condition of the agency as of a certain date. It includes information on
the three elements of financial position - assets, liabilities and government equity. It shall
be prepared from information taken directly from the year-end Post-Closing Trial Balance.
The Balance Sheet shall be supported with the following schedules/statements:
 Schedules of Accounts Receivables (SAR) (Appendix 7)

 Schedules of Accounts Payables (SAP) (Appendix 8)
 Schedules of Public Infrastructures (SPI) (Appendix 9)
 Other schedules as may be required
Although the allotments and obligations of the agency are not recorded in the books
of accounts, the Statement of Allotments, Obligations and Balances (SAOB) (Appendix
10) shall be submitted to the Commission on Audit by the Budget Officer/Agency Officer
concerned. This statement shall to be included among the aforementioned schedules for
information of government officials and oversight agencies.
Statement of Income and Expenses. The Statement of Income and Expenses

(Appendices 11 & 12) shows the results of operation/performance of the agency at the
end of a particular period. This statement shall be prepared by the Accounting Unit from
information taken directly from the Pre-Closing Trial Balance.
Statement of Government Equity. The Statement of Government Equity

(Appendix 13) shows the financial transactions, which resulted to the change in
Government Equity account at the end of the year.
Statement of Cash Flows. The Statement of Cash Flows (Appendix 14) is a

statement summarizing all the cash activities of an agency. This includes the operating,
investing and financing activities of the entity and provides information on the cash
receipts and cash payments during the period. The primary purpose of the Statement of
Cash Flows is to give relevant information on the agency’s overall cash position, liquidity
and solvency. Using the Statement of Cash Flows, managers, investors and creditors
could easily assess if the agency could meet its obligations in operating, investing and
financing activities.
Preparation of the Statement of Cash Flows. To facilitate the preparation of the

Statement of Cash Flows, the use of a Working Paper is encouraged. It shall show the
increase or decrease in the cash accounts between two periods. The net increase in
cash provided by 1) operating 2) investing and 3) financing activities in addition to
the cash balance at the beginning shall equal to the cash balance at the end of the period.
1) Operating Activities. Operating activities involves the principal resources

producing activities of the enterprise and other activities that are not investing or
financing (SFAS 22). Generally, these include the cash effect on transactions
that enter in the Income and Expense Summary account.
2) Investing Activities. Investing activities involves the acquisition and disposal of

long-term assets and other investments not included in cash equivalent (SFAS
22). These activities include cash transactions covering non-operating assets,
such as the purchase of property, equipment, short and long-term investments
and other non-current assets.
Non-cash investing activities are not included in the statement of cash flows.
3) Financing Activities. Financing activities are derived from the equity capital
and borrowings of the agency (SFAS 22). These include cash transactions
involving the government equity and non-operational liabilities.
Non-cash financing activities are not included in the statement of cash flows.
Increase or decrease in the cash accounts is analyzed and the following

computations are made:
Cash flows from operating activities
Cash Inflows:
 Receipt of Notice of Cash allocation (NCA) from the DBM
 Receipt of Notice of Transfer of Allocation to Agency RO/OU from CO
 Cash receipts from all sources of revenues
 Receipt of Inter – agency cash transfers (Due to)
 Cash receipts from the sale of goods or rendition of services
 Cash receipt of interest income, rental income, dividend income, etc.
 Receipt of payment for liquidated damages
 Receipt of refund of deposits
 Receipt of refunds of cash advance or excess payments
 Collection of receivables
 Cash receipt of grants and donations
 Receipt of cash dividends from enterprises (e.g. PLDT)
Cash Outflows:
 Payments of accounts payable
 Cash purchase of merchandise for sale
 Cash advances granted for travel
 Inter-agency transfers (Due from)
 Notice of Transfer of Allocation to Agency RO/OU issued by the NGA
Main Office to RO/OU and/or attached agencies through Government
Servicing Banks
 Return of unused NCA
 Cash payment for operating expenses

 Remittance of taxes withheld not covered by TRA and other deductions
(if any)
 Cash purchase of supplies and equipment
 Cash payment of retirement benefits
 Cash payment of claims for damages
 Cash payment for liabilities incurred in operations
 Cash payments for interest
Cash flows from investing activities:

Cash Inflows:
 Proceeds from sale of marketable stocks and bonds
 Cash proceeds from the sale/disposal of equipment and other
property, plant and equipment
 Redemption of long-term investments or repayment by GOCC/GFI of
long-term loans
Cash Outflows:
 Purchase of property, plant and equipment
 Purchase of land
 Investment in stocks/bonds
 Investment in GOCC/GFI
 Exposure as other long-term investments
Cash flows from financing activities:
Cash Inflows:
 Cash received from domestic and foreign loans
 Issuance of treasury bills
Cash Outflows:
 Payment of domestic and foreign loans
 Redemption of treasury bills outstanding
 Payment of cash dividend
Net increase in cash provided by operating activities, investing activities

and financial activities for the year, and the cash balance at the start of the year,
shall equal the cash balance at the end of the year. Such amount shall tally with
the total cash account shown in the balance sheet.
Notes to Financial Statements. Notes to Financial Statements (Appendix 15) are integral
parts of financial statements, which pertain to additional information necessary for fair
presentation in conformity with generally accepted accounting principles. These may
explain the headings captions or amounts in the statements of present information that
cannot be expressed in money terms, and description of accounting policies.
Information shall be presented in a way that will facilitate understanding and avoid
erroneous implications. The headings, captions and amounts shall be supplemented by
enough additional data so that their meaning would be clear and not overshadowed by so
much information that important matters are buried in mass trivia.
Where Notes to Financial Statements appear on a separate page, indicate the

phrase “See accompanying Notes to Financial Statements” placed at the bottom of said
statements.
Material changes in classification of accounts shall be indicated and explained as

notes to financial statements.
The four types of disclosure considered necessary are as follows:
a. Customary or routine disclosure. Information about measurement bases of

important assets, restrictions on assets and government equity, important long-
term commitments not recognized in the body of the statements, information

on terms of owner’s equity and long-term debt, and certain other disclosures
required by pronouncements of the Philippine Institute of Certified Public
Accountants, Accounting Standards Council, and regulatory bodies that have
jurisdiction are necessary for full disclosure.
b. Disclosure of changes in accounting principles. Changes in accounting

principles, practices, or the methods of applying them, together with the
financial effect, and the justification for the change shall be disclosed in the
financial statements or a note thereto.
In particular, it shall include any of the following:
 Selection from existing acceptable alternatives
 Principles and methods peculiar to the agency
 Unusual application of generally accepted accounting principles.
c. Disclosure of subsequent events. Disclosure of events that affect the

agency directly and that occur between the date of, or end of the period
covered by, the financial statements and the date of completion of the
statements is necessary if knowledge of the events might affect the
interpretation of the statements, even though the events do not affect the
propriety of the statements themselves.
d. Disclosure of accounting policies. Description of the accounting policies

adopted by the reporting entity is required as an integral part of the financial
statements. It is usually captioned “Summary of Significant Accounting
Policies”, and placed as first item in the Notes. It shall be limited to description
of the policies and no quantitative data shall be included.
Examples of accounting policy disclosures commonly required:

 Consolidation principles
 Accounting for long-term investments
 Adoption of policy on increasing benefit entitlements of the program
members. The effect of the increase shall be disclosed.
 Basis of revenue recognition
In general, disclosures shall include important judgment as to appropriateness of

principles relating to recognition of revenues and allocation of asset costs to current and
future periods.
Interim Reports. Interim reports are the financial statements required to be

prepared at any given period or at a financial reporting period without closing the books of
accounts. The following interim financial statements shall be prepared and submitted
quarterly with the Notes to Financial Statements:
a. Statement of Income and Expenses;
b. Balance Sheet; and
c. Statement of Cash Flows.
The interim financial statements shall be prepared employing the same accounting
principles used for annual reports. Adjusting and closing journal entries shall be prepared.
However, only the adjusting journal entries are recorded in the books of accounts. To
facilitate the preparation of the interim financial statements, the use of the worksheet is
recommended.
Worksheet. A worksheet is a tool for accumulating and sorting information needed for
the preparation of the financial statements. It is a columnar sheet used to adjust and close
account balances in preparation for the preparation of the financial statements. The
format of the worksheet shall be as follows:
Agency Name
Worksheet
As of __________, 20__
Adjusted/Pre- Statement of
Unadjusted Closing Post-Closing Balance
Accounts Adjustments Closing Trial Income and
Trial Balance Entries Trial Balance Sheet
Balance Expenses
Title Code Dr. Cr. Dr. Cr. Dr. Cr. Dr. Cr. Dr. Cr. Dr. Cr. Dr. Cr.
a. Account Title and Code columns show the accounts of the General Ledger.
b. The Unadjusted Trial Balance columns reflect the amount balances of the
General Ledger accounts.
c. Adjustments columns show adjusting journal entries effected for the accounts.
d. Adjusted/Pre-Closing Trial Balance columns show the balances of all the

accounts after adjustments are added/deducted from the balances of accounts
in the unadjusted trial balance.
e. Closing Entries debit and credit columns show the amounts debited and
credited to close the nominal accounts.
f. Statement of Income and Expenses columns show all the debit and credit
amount balances of the nominal accounts (subsidies, income and expenses)
and intermediate accounts.
g. Post-Closing Trial Balance columns show the debit and credit amount
balances of all accounts after posting the closing entries.
h. Balance Sheet columns show all the debit and credit amount balances of all
real accounts in the post-closing trial balance (assets, liabilities and
government equity).
Chapter 6. Responsibility Accounting
Responsibility Accounting Defined. Responsibility accounting is a system that relates

the financial results to a responsibility center, which provides access to cost and revenue
information under the supervision of a manager having a direct responsibility for its
performance. It is a system that measures the plans (by budgets) and actions (by actual
results) of each responsibility center.
Responsibility Center Defined. It is a part, segment, unit or function of a government

agency, headed by a manager, who is accountable for a specified set of activities. Except
for some, which derive most of their income from collection of taxes and fees, national
government agencies are basically cost centers whose primary purpose is to render
service to the public at the lowest possible cost. Cost centers are established to provide
each government agency accessibility to cost information and to facilitate cost monitoring
at any given period. While the use of Subsidiary Ledgers is sufficient to control cost, it
requires considerable time to summarize the cost incurred by agency for its different
programs, projects, activities and offices/divisions, hence, responsibility accounting shall
be done only under the computerized accounting system.
Objectives of Responsibility Accounting. Responsibility accounting aims to: a) ensure

that all costs and revenues are properly charged/credited to the correct responsibility
center so that deviations from the budget can be readily attributed to managers
accountable therefore; b) provide a basis for making decisions for future operations; and
c) facilitate review activities, monitoring the performance of each responsibility center and
evaluation of the effectiveness of agency’s operations.
Concepts of Responsibility Accounting. The following are the concepts of

responsibility accounting:
a. Responsibility accounting involves accumulating and reporting data on revenues

and costs on the basis of the manager’s action who has authority to make the
day-to-day decisions about the items;
b. Evaluation of a manager’s performance is based on the matters directly under

his control;
c. Responsibility accounting can be used at every level of management in which

the following conditions exist:
1. Cost and revenues can be directly associated with the specific level of
management responsibility;
2. Costs and revenues are controllable at the level of responsibility with
which they are associated.
3. Budget data can be developed for evaluating the manager’s
effectiveness in controlling the costs and revenues.
d. The reporting of costs and revenues under responsibility accounting differs from
budgeting in two respects:
1. A distinction is made between controllable and non-controllable costs.

a) A cost is considered controllable at a given level of managerial
responsibility if that manager has the power to incur it within a given
period of time. It follows that (1) all costs are controllable by top
management because of the broad range of its activity; (2) fewer
costs are controllable as one moves down to lower level of
managerial responsibility because of the manager’s decreasing
authority.
b) Non-controllable costs are costs incurred indirectly and allocated to
a responsibility level.
2. Performance reports either emphasize or include only items

controllable by individual manager.
e. A responsibility reporting system involves the preparation of a report for each

level of responsibility. Responsibility reports usually compare actual costs with
flexible budget data. The reports show only controllable costs and no distinction
is made between variable and fixed costs.
f. Evaluation of a manager’s performance for cost centers is based on his ability

to meet budgeted goals for controllable costs.
Responsibility Center Code Structure. Each government agency shall be assigned a

responsibility center code. The coding structure shall be as follows:
000-00-000-000-000
Examples:
Department/Agency/Province/City
Example 1 Area (CO/RO)

Responsibility
000 -01-000-122 - 831

Sub-responsibility Area (District/
Department
Division) of ABC
Office of the Secretary
Sub-responsibility Area
(Office/Unit/Program/Project)
Central Office
None
Account Code
Accounting Unit
Travelling Expense-Local
Example 2
000 - 06-021 - 401 - 831
Department
Office of the Secretary
Regional Office III
Operating Unit I
Local Project -
Computerization
Travelling Expense - Local
Computerized Accounting System. Since responsibility accounting cannot be done

under the manual system, the details of this shall be discussed on the Manual for
Computerized Accounting system to be issued by the Commission on Audit.
Chapter 7. Illustrative Accounting Entries

Illustrative Accounting Entries in Regular Agency(RA) Books.
a. Illustrative Accounting Entries for Typical Transactions of Central/Regional

Offices and Operating Units (CO/RO/OU) receiving Notice of Cash Allocation
(NCA) from the Department of Budget and Management (DBM).
Central/Regional Offices and Operating Units receiving NCA directly from the
DBM shall be guided by the illustrative accounting entries shown in Annex A.
b. Illustrative Accounting Entries for Decentralized Agencies

Regional Offices and Operating Units receiving NCA directly from the DBM
and funding checks from CO/RO shall be guided by the illustrative accounting
entries shown in Annex B.
Illustrative Accounting Entries in National Government (NG) Books.
National Government Agencies whose income/collections are required to be

recorded in the NG Books and remitted to the National Treasury through Authorized
Government Depository Banks shall follow the illustrative accounting entries.
ACCOUNTING BOOKS, FORMS & REPORTS

Accounting Books. Agencies of the National Government shall maintain two sets of
accounting books composed basically of the following:
a. Regular Agency(RA) Books - This shall be used to record the regular

transactions of the agency like the receipt and utilization of Notice of Cash
Allocation(NCA) and collections of income and other receipts, which the
agency can use.
b. National Government(NG) Books - This shall be used to record

income/collections which the agency cannot use and are required to be
remitted to the National Treasury.
Books of Accounts. The books of accounts shall consist of a) records for recording
transactions in chronological order, known as the journals or books of original entry, and
b) records for classifying and summarizing the effects of the transactions on individual
accounts, known as general/subsidiary ledgers or books of final entry.
Books of Original Entry. Books of original entry or journals, shall be used to record in
time sequence, financial transactions and information presented in duly certified and
approved accounting documents.
Basis of recording in journal book shall be the Journal Entry Voucher (JEV).
Meanwhile that agencies are waiting to be computerized, four special journals, in

addition to the General Journal, shall be used namely, a) Cash Receipts Journal (RA
book), b) Cash Journal (NG book), c) Check Disbursements Journal, and d) Cash
Disbursements Journal.
The totals of each account in the Special Journals and individual entries in the
General Journal shall be posted directly to the General Ledger. Postings to the
Subsidiary Ledgers shall come from the source documents or the JEV.
General Journal(GJ). This Journal (Appendix 1) shall be used to record all transactions
which cannot be recorded in the four special journals. It provides columns for the date, the
JEV number, particulars which give explanation of the transactions recorded, the account
code, posting reference and the debit and credit amounts.
Special Journals. The special journals are specifically designed to record transactions
which are repetitive in nature. Special columns are provided to facilitate summations and
postings in the General Ledger.
Cash Receipts Journal(CRJ). This Journal (Appendix 2) shall be used to record all
collections and deposits reported during the month for the RA book. The source of entries
are the JEVs which shall be prepared based on the Reports of Collections and
Deposits(RCDs) submitted by the Cashier or Collecting Officers to the Accounting Unit
or the official receipts acknowledging collections.
Cash Journal(CJ). This Journal (Appendix 3) shall be used to record all collections and
deposits reported during the month for the NG books. The source of entries are the JEVs
which shall be prepared based on the RCDs submitted by the Cashier or Collecting Officer
to the Accounting Unit or the official receipts acknowledging collections.
Check Disbursements Journal (CkDJ). This Journal (Appendix 4) shall be used to

record check payments made by the Cashier or Disbursing Officers. Recording to this
journal shall be based on the JEVs supported with paid Disbursement Vouchers (DVs)
and duplicate copies of checks listed in the Reports of Checks Issued (RCI) submitted by
the Cashier/Disbursing Officers.
Cash Disbursements Journal(CDJ). This Journal (Appendix 5) shall be used to record

all payments made in cash by the Regular/Special Disbursing Officers out of their cash
advances. Recording to this journal shall be based on the JEVs supported with the Report
of Disbursements (RD) and pertinent documents like the paid payroll, disbursement
voucher, etc.
Books of Final Entry. The books of final entry are the General Ledgers and Subsidiary
Ledgers.
General Ledger(GL). The General Ledger (Appendix 6) is a book of final entry containing
accounts arranged in the same sequence as in the chart of accounts. Totals of columns
in the special journals and the individual entries in the GJ are directly posted in this book.
At the end of each month, the accounts are footed and at the end of each year, these are
totaled, ruled and closed and the balance extracted to serve as the opening balance of
the new fiscal year. Likewise, the account with balances shall appear in the trial balance.
Subsidiary Ledger(SL). The SL is a book of final entry containing the details or

breakdown of the balance of the controlling account appearing in the GL. Postings to the
SL generally come from the source documents. Examples of GL accounts which have SL
are Cash-Collecting Officers, Cash-Disbursing Officers, Cash in Bank – Local Currency,
Current Account, Accounts Receivable, Notes Receivable, etc. The totals of the SL
balances shall be reconciled with their respective control account regularly or at the end
of each month. Schedules shall be prepared periodically to support the corresponding
controlling GL accounts. Examples of subsidiary ledgers are:
 Subsidiary Ledger (SL) (Appendix 7)

 Property, Plant and Equipment Ledger Card (PPELC)(Appendix 8)
 Supplies Ledger Card (SLC) (Appendix 9)
 Construction in Progress Ledger Card (CIPLC) (Appendix 10)
 Investment Ledger Card (ILC) (Appendix 11)
Registries. In order to monitor allotments received, obligations incurred, NCAs received

and utilized, public infrastructures, dormant accounts, accounts written-off loans and
grants, among others, registries shall be maintained by the concerned government
agencies.
Registry of Appropriations and Allotments(RAPAL). The Registry of Appropriations

and Allotments (Appendix 12) shall be maintained by the Department of Budget and
Management(DBM)for each department of the National Government to control approved
appropriations and allotments released.
Registry of Allotments and NCA Issued(RANCAI). The Registry of Allotments and NCA
Issued (Appendix 13) shall be maintained by the DBM to control the funding of allotments.
The Registry shall be kept by department/agency. Columns are provided for each
allotment class and NCA released to the department/agency. A column for the unfunded
allotment is provided to determine the balance of allotment without corresponding NCA.
Registry of NCA and Replenishments(RENREP). The Registry of NCA and

Replenishments (Appendix 14) shall be used by the Bureau of the Treasury to record the
NCA releases and the bank replenishments made to cover MDS checks issued by
agencies.
Registries of Allotments and Obligations(RAO). The Registries of Allotments and

Obligations(RAO) shall be prepared by agencies to record allotments and obligations.
This record shall be maintained by the Budget Unit/Authorized Official of the agency to
monitor allotments available for obligations. It shall show all the allotments received and
the obligations incurred charged against the corresponding allotment. The balance is
extracted every time an entry is made to prevent incurrence of obligations in excess of
allotment received.
The registries are as follows:
a. Registry of Allotments and Obligations-Capital Outlay (RAOCO),

b. Registry of Allotments and Obligations-Maintenance and Other
Operating Expenses (RAOMO),
c. Registry of Allotments and Obligations-Personal Services (RAOPS),
d. Registry of Allotments and Obligations-Financial Expenses (RAOFE).
Registry of Allotments and Obligations-Capital Outlay(RAOCO). The Registry of

Allotments and Obligations-Capital Outlay (Appendix 15) shall be used to record
allotments received and obligations incurred for capital outlay.
Registry of Allotments and Obligations-Maintenance and Other Operating

Expenses(RAOMO). The Registry of Allotments and Obligations-Maintenance and Other
Operating Expenses (Appendix 16) shall be used to record allotments received and
obligations incurred for expenses classified under Maintenance and Other Operating
Expenses.
Registry of Allotments and Obligations-Personal Services(RAOPS). The Registry of

Allotments and Obligations-Personal Services (Appendix 17) shall be used to record
allotments received and obligations incurred for expenses classified under Personal
Services.
Registry of Allotments and Obligations-Financial Expenses(RAOFE). The Registry of

Allotments and Obligations-Financial Expenses (Appendix 18) shall be used to record
allotments received and obligations incurred for financial expenses, such as commitment
fees, bank charges, etc. so as to distinguish them from the regular maintenance and other
operating expenses.
Registry of Allotments and NCA(RANCA). The Registry of Allotments and NCA

(Appendix 19) shall be maintained by the agency particularly the Accounting Unit to
monitor the allotment received and NCA received, utilized and the unfunded balance as
of a given date.
Registry of Public Infrastructures(RPI). The Registry of Public Infrastructures

(Appendix 20) shall be used to record properties for use by the general public. A separate
Registry shall be maintained for each class of property or asset, example, Plaza, Parks
and Monuments; Roads, Highways and Bridges; Ports, Harbors, Seawalls, River Walls
and Others; Runways; Railways; Waterways, Aqueducts, etc; and Irrigation Canals and
Laterals, etc. For proper costing, the original construction cost and any major repairs
undertaken shall be posted in the respective Registry. It shall be maintained by the
Accounting Unit of the agency.
Registry of Reforestation Projects(RRP). The Registry of Reforestation Projects

(Appendix 21) shall be used to record expenses incurred on reforestation projects. It shall
be maintained by the Accounting Unit of the agency implementing reforestation projects.
Registry of Public Infrastructures - Summary(RPIS). The Registry of Public

Infrastructures-Summary (Appendix 22) shall be used to summarize all the public
infrastructures of the agency. The total of each registry shall be posted in the summary
and the total public infrastructures shall be disclosed in the notes to the financial
statements.
Registry of Dormant Accounts(RDA). The Registry of Dormant Accounts (Appendix

23) shall be used to record the transfer of dormant accounts from the RA books pursuant
to existing COA rules and regulations. It shall be maintained by the Accounting Unit of the
agency.
Registry of Accounts Written-Off(RAWO). The Registry of Accounts Written-Off

(Appendix 24) shall be used to record the amount of accounts receivable written-off from
the RA books. It shall be maintained by the Accounting Unit of the agency.
Registry of Loan Availments and Repayments – Foreign, Individual(RLARFI). The

Registry of Loan Availments and Repayments – Foreign, Individual (Appendix 25) shall
be used to record the amount of availments and repayments of the individual loan
accounts of the Government of the Philippines (GOP) with foreign lending institutions. It
shall be maintained by the Bureau of the Treasury (BTr) of the Department of Finance
(DOF).
Registry of Loans Availments and Repayments – Foreign, Summary(RLARFS). The

Registry of Loans Availments and Repayments – Foreign, Summary (Appendix 26) shall
be used to summarize the amount of loan availments and repayments of the GOP with
foreign lending institutions on a regular basis as recorded in the RLARFI. It shall be
maintained by the BTr, DOF.
Registry of Loan Availments and Repayments – Domestic, Individual(RLARDI). The

Registry of Loans Availments and Repayments – Domestic, Individual (Appendix 27) shall
be used to record the amount of loan availments and repayments of the GOP with the
domestic lending institutions. It shall be maintained by the BTr, DOF.
Registry of Loans Availments and Repayments – Domestic, Summary(RLARDS).

The Registry of Loans Availments and Repayments – Domestic, Summary (Appendix 28)
shall be used to summarize the amount of loans availments and repayments of the GOP
with the domestic lending institutions as recorded in the RLARDI. It shall be maintained
by the BTr, DOF.
Registry of Grant Availments and Utilization –Foreign, Individual Donor(RGAUFID).

The Registry of Grants Availments and Utilization – Foreign, Individual Donor (Appendix
29) shall be used to record the amount of grants received by the GOP thru the BTr from
individual foreign donor and utilization thereof. It shall be maintained by the BTr, DOF.
Registry of Grants Availments and Utilization -Foreign, Summary(RGAUFS). The

Registry of Grants Availments and Utilization - Foreign, Summary (Appendix 30) shall be
used to summarize the amount of grants received by the GOP thru the BTr from foreign
donors and utilization thereof. It shall be maintained by the BTr, DOF.
Registry of Grants Availments and Utilization – Domestic, Individual

Donor(RGAUDID). The Registry of Grants Availments and Utilization – Domestic
Individual Donor (Appendix 31) shall be used to record the amount of grants received by
the GOP thru the BTr from individual domestic donor and grant utilization. It shall be
maintained by the BTr, DOF.
Registry of Grants Availments and Utilization – Domestic, Summary(RGAUDS). The

Registry of Grants Availments and Utilization – Domestic Summary (Appendix 32) shall
be used to summarize the amount of grants received by the GOP thru the BTr from
domestic donors and grant utilization. It shall be maintained by the BTr, DOF.
Registry of Guaranteed Loans – Domestic(RGLD). The Registry of Guaranteed Loans

– Domestic (Appendix 33) shall be used to summarize the amount of loans of private
entities with domestic lending institutions as guaranteed by the GOP. It shall be
maintained by the BTr, DOF. The total guaranteed loans shall be included in the notes to
financial statements and any amount deemed uncollectible shall be treated as
expense/liability of the National Government.
Registry of Guaranteed Loans – Foreign(RGLF). The Registry of Guaranteed Loans –

Foreign (Appendix 34) shall be used to record the amount of loans of government
agencies and private entities with the foreign lending institutions as guaranteed by the
GOP. It shall be maintained by the BTr, DOF.
Cash Receipts Record(CRR). The Cash Receipts Record (Appendix 35) shall be used
by the designated Collecting Officer to record his/her collections and deposits.
Check Disbursements Record (CkDR). The Check Disbursements Record (Appendix

36) shall be used by the Disbursing Officer to record checks released charged against
NCAs/funding checks received/deposits in a bank current account of government

agencies. A separate record shall be maintained for each source of fund.
Cash Disbursements Record (CDR). The Cash Disbursements Record (Appendix 37)
shall be used by the Disbursing Officer to record the cash advance received and
disbursements made out of the cash advances.
Stock Card (SC). The Stock Card (Appendix 38) shall be used to record all receipts and
issuances of supplies. It shall be maintained by the Supply and Property Unit for each item
in stock.
Property Card(PC). The Property Card (Appendix 39) shall be used by the Supply and
Property Unit to record the description, transfer/acquisition, disposal, and other
information about the property, plant and equipment. It shall be kept for each class of
property, plant and equipment.
Chapter 8. The Accounting Forms and Reports

Journal Entry Voucher(JEV). The Journal Entry Voucher (Appendix 40) shall be used
for all transactions of the government, whether cash receipts, cash/check disbursements
or non-cash transactions. It shall be prepared by the Accounting Unit based on transaction
documents presented. Accounting journal entries shall be reflected therein and it shall
serve as the basis for recording the transactions in the appropriate journals.
Allotment and Obligation Slip(ALOBS). The Allotment and Obligation Slip (Appendix
41) shall be used to record allotments received and to request for obligation charged
against the allotments. It shall be prepared before processing the claim to ensure that
funds are available for the purpose.
Order of Payment(OP). The Order of Payment (Appendix 42) shall be accomplished by

the Accounting Unit by stating the nature and computation of amount due before
collections shall be received by the Cashier.
Disbursement Voucher(DV). The Disbursement Voucher (Appendix 43) shall be used

by government agencies for all money claims. The number shall be indicated on the DV
and on every supporting document of the claim. The supporting documents shall be listed
on the face of the voucher and in case more space is needed, the back of the DV shall be
used.
Petty Cash Voucher(PCV). The Petty Cash Voucher (Appendix 44) shall be used for
disbursements out of the Petty Cash Fund.
General Payroll(GP). The General Payroll (Appendix 45) shall be used for the payment
of salaries, wages, overtime pay, honoraria and other emoluments of government officers
and employees.
Itinerary of Travel(IT). The Itinerary of Travel (Appendix 46) shall be prepared by the
concerned official or employee making the travel. The IT shows the details of travel such
as places to be visited, date, including the amount of expenses to be incurred. It shall be
prepared before the travel is made or upon reimbursement of travelling expenses.
Payroll Payment Slip(PPS). The Payroll Payment Slip (Appendix 47) shows amounts of
compensation income due and paid for a pay period including the details of deductions.
Index of Payments(IP). The Index of Payments (Appendix 48) shall be used to record
payments made to each employee, supplier, and other agency creditors.
Supplies Availability Inquiry(SAI). The Supplies Availability Inquiry (Appendix 49) shall
be used to inquire the availability of supplies on stock from the Accounting Unit.
Requisition and Issue Slip(RIS). The Requisition and Issue Slip (Appendix 50) shall be
used to request supplies and materials that are carried on stock.
Purchase Request(PR). The Purchase Request (Appendix 51) shall be used to request
for the purchase of inventory/item not available on stock and it shall be the basis of
preparing the Purchase Order.
Purchase Order(PO). The Purchase Order (Appendix 52) shall be used to support
purchase of equipment, supplies and materials, etc.
Acknowledgement Receipt for Equipment(ARE). The Acknowledgement Receipt for

Equipment (Appendix 53) shall be used to acknowledge the receipt of property and
equipment for official use from the Property Officer.
Report of Collections and Deposits(RCD). The Report of Collections and Deposits

(Appendix 54) shall be prepared by the Cashiers/Collecting Officers to report all collections
received and deposits made. The report lists all the ORs issued in numerical sequence,
including the cancelled ones. The report shall be the basis in preparing the JEV for
recording in the Cash Receipt Journal/Cash Journal, as the case maybe.
Report of Checks Issued(RCI). The Report of Checks Issued (Appendix 55) shall be
prepared by the Cashiers/Disbursing Officers to report checks actually received by the
payor or authorized representatives during the period. including cancelled ones. Separate
RCI shall be prepared for MDS and commercial checks released. The report shall be the
basis in preparing and recording the JEV in the Check Disbursements Journal. It shall be
supported with list of unclaimed checks.
Report of Disbursements(RD). The Report of Disbursements (Appendix 56) shall be

prepared by the Regular/Special Disbursing Officers to support liquidations of their cash
advances. The report shall be certified as to correctness by the Disbursing Officer and
forwarded to the Accounting Unit for preparation of the JEV and final recording in the Cash
Disbursements Journal.
Petty Cash Replenishment Report(PCRR). The Petty Cash Replenishment Report

(Appendix 57) shall be prepared by the Petty Cash Custodian to report all disbursements
made out of his Petty Cash Fund.
Liquidation Report(LR). The Liquidation Report (Appendix 58) shall be prepared by the
concerned employees/officers to liquidate cash advances for travel or for other purposes
except those cash advances granted to Regular/Special Disbursing Officers.
Report of Supplies and Materials Issued(RSMI). The Report of Supplies and Materials
Issued (Appendix 59) shall be prepared by the Supply Officer and shall be used by the
Accounting Unit as a basis in preparing the JEV to record the supplies and materials
issued.
Waste Materials Report(WMR). The Waste Materials Report (Appendix 60)shall be used
to report all waste materials such as destroyed spare parts and other materials considered
scrap due to replacement.
Inventory and Inspection Report for Unserviceable Property (IIRUP). The Inventory
and Inspection Report for Unserviceable Property (Appendix 61) shall be used as basis to
record dropping from the books the unserviceable properties carried in the Property, Plant
and Equipment accounts.
Report on the Physical Count of Inventories(RPCI). The Report on the Physical Count
of Inventories (Appendix 62) shall be used to report the physical count of supplies by type
of inventory as of a given date. It shows the balance of inventory items per cards and per
count and shortage/overage, if any.
Report on the Physical Count of Property, Plant and Equipment (RPCPPE). The
Report on the Physical Count of Property, Plant and Equipment (Appendix 63) shall be
used to report the physical count of property, plant and equipment by type as of a given
date. It shows the balance of property and equipment per cards and per count and
shortage/overage, if any.
Inspection and Acceptance Report(IAR). The Inspection and Acceptance Report

(Appendix 64) shall be used to acknowledge the receipt of supplies and equipment
purchased and inspection made thereof.
Report of Accountability for Accountable Forms(RAAF). The Report of Accountability

for Accountable Forms (Appendix 65) shall be prepared by the Accountable Officer to
report on the movement and status of accountable forms in his possession. The
accountable forms include those with or without face value.
Chapter 9. THE CHART OF ACCOUNTS
Definition. The Chart of Accounts provides the framework within which the accounting
records are constructed. It is defined as a list of general ledger accounts consisting of real
and nominal accounts.
Rationale. The Chart of Accounts is prescribed for use by all national government
agencies and local government units. The descriptions of all the accounts and the
instructions as to when these are to be debited and credited are provided to achieve
uniformity in the recording of government financial transactions.
Elements of Financial Statements. Elements of financial statements of government

agencies are those elements that relate to the status or measurement of financial position
and measurement of performance of government agencies, which are relevant to
decisions that would require the commitment of resources. Those elements directly related
to the measurement of financial position as shown in the Balance Sheet are assets,
liabilities and equity. The elements directly related to the measurement of performance
which are shown in the Statement of Income and Expenses are revenue/income and
expenses. The definitions of the different elements are as follows:
a. Assets –economic resources of an agency that are recognized and measured

in conformity with generally accepted accounting principles. Assets also
include certain deferred charges that are not resources but that are recognized
and measured in conformity with generally accepted accounting principles.
b. Liabilities – economic obligations of an agency that are recognized and

measured in conformity with generally accepted accounting principles.
Liabilities also include certain deferred credits that are not obligations but that
are recognized and measured in conformity with generally accepted
accounting principles.
c. Equity – residual interest of the government in an agency which is the excess

of the agency’s assets over its liabilities.
d. Revenue/Income – increase in economic benefits during the accounting

period in the form of inflows or enhancements of assets or decrease of liabilities
that results in increases in equity.
e. Expenses– decrease in economic benefits during an accounting period in the

form of outflows or depletions of assets or incurrence of liabilities that results
in decreases in equity.
Balance Sheet Accounts. The balance sheet accounts consist of assets, liabilities and
equity. These are classified into the following:
Assets -
Current Assets
Cash
Receivables
Marketable Securities
Inventories
Prepaid Expenses
Other Current Assets
Long-Term Investments
Property, Plant and Equipment
Other Assets
Liabilities -
Current Liabilities
Long-Term Liabilities
Other Liabilities
Equity -
Government Equity
Revenue/Income and Expense Accounts. Revenue/income and expenses consist of

the following:
Revenue/Income
General Income Accounts
Specific Income Accounts
Expenses
Personal Services
Maintenance and Other Operating Expenses
Financial Expenses
Classification of Revenue/Income. The revenue/ income accounts are classified into:
a. General Income Accounts - This account classification encompasses all

types of revenue/income generated by government agencies in the exercise
of their administrative and regulatory function, income from public
enterprises/investments, and income from grants and donations including
subsidies.
b. Specific Income Accounts - This account classification encompasses all

taxes imposed on taxable income, properties, and use or sale of goods and
services, taxes on international trade and transactions and other taxes
including fines and penalties. Also included under these accounts are income
generated from local government, schools and hospital operations.
Income realized/collected for which the agency is authorized to use but required
to be remitted to the National Treasury shall be recorded under the Regular Agency (RA)
books. A receivable account, Due from National Treasury, shall be debited upon
remittance to the account of the Treasurer of the Philippines and the same account shall
be credited upon receipt of the Notice of Cash Allocation issued by the DBM. At the end
of the year, the income account shall be closed to the Income and Expense Summary
account. Likewise, income collected and deposited under the agencies’ accounts with
AGDBs, as authorized, shall be recorded in the RA books.
Income realized/collected for the National Government(NG) and for which the
agency is not authorized to use shall be recorded under the NG books maintained by the
agency. A liability account, Due to National Treasury, shall be set up upon
accrual/collection and the same account shall be debited upon remittance to the National
Treasury.
The illustrative accounting entries relative to the use of the income accounts and
related receivable/payable account are shown in Chapter 7, Volume I of the Manual.
Classification of Expenses. Expense accounts classified into:
a. Personal Services(PS) - These accounts include basic pay, all authorized

allowances, bonus, cash gifts, incentives and other personnel benefits of
officials and employees of the government.
b. Maintenance and Other Operating Expenses(MOOE) - These accounts

include expenses necessary for the regular operations of an agency like,
among other traveling expenses, training and seminar expenses, water,
electricity, supplies expense, maintenance of property, plant and equipment,
and other maintenance and operating expenses.
c. Financial Expenses(FE) - These accounts include bank charges, interest

expense, commitment charges, documentary stamp expense and other
financial charges. It also includes losses incurred relative to foreign exchange
transactions and debt service subsidy to GOCCs.
Intermediate Accounts. These are accounts which are closed ultimately to the
Government Equity account at the end of the accounting period. These include Cost of
Goods Sold, Income and Expense Summary, Prior Years’ Adjustments, Retained
Operating Surplus, Subsidy to Regional Offices/Staff Bureaus and Subsidy to Operating
Units, among others.
Account Codes. The Chart of Accounts consists of three-digit codes grouped as follows:
Accounts Account Codes
Assets 100-299
Asset Contra Accounts 300-399
Liabilities 400-499
Equity 500-599
600-799
Revenue/Income
General Income 600-699
Accounts
Specific Income 700-799
Accounts
Expenses 800-960
Personal Services 801-830
Maintenance and 831-950
Other
Operating
Expenses
951-960
Financial Expenses
Interest Expense
Bank Charges
The Chart of Accounts. Chart of Accounts is prescribed for use of the national
government agencies and local government units.
CHART OF ACCOUNTS
Account
Account Title
Code
ASSETS
Current Assets
Cash
101 Cash in Treasury
102 Cash – National Treasury, Modified Disbursement System (MDS)
103 Cash – Bangko Sentral ng Pilipinas
105 Petty Cash Fund
106 Cash – Collecting Officers
107 Cash – Disbursing Officers
110 Cash in Bank – Local Currency, Current Account
111 Cash in Bank – Local Currency, Savings Account
112 Cash in Bank – Local Currency, Time Deposits
113 Cash in Bank – Foreign Currency, Current Account
114 Cash in Bank – Foreign Currency, Savings Account
115 Cash in Bank – Foreign Currency, Time Deposits
Receivables
121 Accounts Receivable
122 Notes Receivable
123 Loans Receivable, Current
124 * Real Property Tax Receivable

* For Use of the LGUs
CHART OF ACCOUNTS
Account
Account Title
Code
125 * Special Education Tax Receivable

126 Interests Receivable
127 ** Currency Swap Receivable
128 Due from Officers and Employees
129 * Due from Other Funds
130 Due from NGAs
131 Due from LGUs
132 Due from GOCCs
133 Due from NGOs/POs
134 Due from National Treasury
135 Due from Central Office
136 Due from Regional Offices/Staff Bureaus
137 Due from Operating Units
138 Receivables – Disallowances/Charges
139 Other Receivables
301 Allowance for Doubtful Accounts
140 Treasury Bills
141 * Stocks
142 * Bonds
143 Other Marketable Securities
Inventories
144 Raw Materials Inventory
145 Work-In-Process Inventory
146 Finished Goods Inventory
147 Merchandise Inventory
148 Accountable Forms Inventory
149 Office Supplies Inventory
150 Medical, Dental and Laboratory Supplies Inventory
151 Food/Non-food Supplies Inventory
152 Gasoline, Oil and Lubricants Inventory
153 Agricultural Supplies Inventory
154 Livestock and Crops Inventory
155 Spare Parts Inventory
156 Construction Materials Inventory
157 Other Agricultural Products Inventory
158 Confiscated Goods Inventory
160 Other Inventory Items
Prepaid Expenses
161 Prepaid Rent
162 Prepaid Insurance
164 Prepaid Interest
165 Other Prepaid Expenses
*For Use of the LGUs

**
For Use of the Bureau of the Treasury
CHART OF ACCOUNTS
Account
Account Title
Code
166 Guaranty Deposits

167 Deposits on Letters of Credit
168 Advances to Contractors
170 Other Current Assets
Long - Term Investments

171 Loans Receivable – Long-Term, LGUs
172 Loans Receivable – Long-Term, GOCCs
173 Loans Receivable – Long-Term, Others
174 Investments in Stocks
175 Investments in Bonds
176 Investments in GOCCs
177 Sinking Fund – Cash
178 Sinking Fund – Securities
179 Other Long-Term Investments

201 Land
202 Land Improvements

302 Accumulated Depreciation – Land Improvements
203 Leasehold Improvements

303 Accumulated Depreciation – Leasehold Improvements
204 Buildings
304 Accumulated Depreciation – Buildings
205 School Buildings

305 Accumulated Depreciation – School Buildings
206 Markets and Slaughterhouses

306 Accumulated Depreciation – Markets and Slaughterhouses
207 Hospitals and Health Centers

307 Accumulated Depreciation – Hospitals and Health Centers
208 Other Structures

308 Accumulated Depreciation – Other Structures
209 Industrial Machineries

309 Accumulated Depreciation – Industrial Machineries
210 Other Machineries

310 Accumulated Depreciation – Other Machineries
211 Firefighting Equipment and Accessories

311 Accumulated Depreciation – Firefighting Eqpt. and Accessories
212 Construction and Heavy Equipment

312 Accumulated Depreciation – Construction and Heavy Eqpt.
214 Technical and Scientific Equipment
CHART OF ACCOUNTS
Account
Account Title
Code
215 IT Equipment and Software

315 Accumulated Depreciation – I T Equipment
216 Telegraph, Telephone, Cable, TV and Radio Equipment

316 Accumulated Depreciation – Telex, Tel., Cable, TV and Radio Eqpt.
217 Artesian Wells, Reservoirs, Pumping Stations and Conduits

317 Accumulated Depreciation – Artesian Wells, Reservoirs, Pumping
Stations and Conduits
218 Motor Vehicles

318 Accumulated Depreciation – Motor Vehicles
219 Watercrafts
319 Accumulated Depreciation – Watercrafts
220 Trains
320 Accumulated Depreciation – Trains
221 Aircrafts/Aircraft Ground Equipment

321 Accumulated Depreciation – Aircrafts/Aircraft Ground Equipment
222 Office Equipment

322 Accumulated Depreciation – Office Equipment
223 Other Equipment

323 Accumulated Depreciation – Other Equipment
224 Furniture and Fixtures

324 Accumulated Depreciation – Furniture and Fixtures
225 Ordnance
325 Accumulated Depreciation – Ordnance
226 Books
326 Accumulated Depreciation – Books
227 Other Property, Plant and Equipment

327 Accumulated Depreciation – Other Property, Plant
and Eqpt.
228 Work/Other Animals

229 Breeding Stocks
230 Construction in Progress – Agency Assets
231 Construction in Progress – Plaza, Parks and Monuments
232 Construction in Progress – Roads, Highways and Bridges
233 Construction in Progress – Ports, Lighthouses, Harbors, Seawalls,
River Walls and Others
234 Construction in Progress – Airports and Runways
235 Construction in Progress – Railways
236 Construction in Progress – Waterways, Aqueducts, etc.
237 Construction in Progress – Irrigation, Canals and Laterals
CHART OF ACCOUNTS
Account
Account Title
Code
238 Construction in Progress – Electrification, Power and Energy

Structures
241 Construction in Progress – Other Public Infrastructures
242 Construction in Progress – Reforestation Projects
243 Public Infrastructures
244 Reforestation Projects
245 Arts, Archeological Specimen and Other Exhibits
249 Items in Transit
Other Assets
251 Other Assets
LIABILITIES AND EQUITY

LIABILITIES
Current Liabilities
401 Accounts Payable
402 Notes Payable
403 Loans Payable – Current, Domestic
404 Loans Payable – Current, Foreign
406 Interests Payable
407 Tax Refunds Payable
408 Guaranty Deposits Payable
409 Tax Credit Certificates Payable
410 Withholding Taxes Payable
411 GSIS Payable
412 PAG-IBIG Payable
413 PHILHEALTH Payable
414 Performance/Bidders/Bail Bonds Payable
427 ** Currency Swap Payable
428 Due to Officers and Employees
429 * Due to Other Funds
430 Due to NGAs
431 Due to LGUs
432 Due to GOCCs
433 Due to National Treasury
435 Due to Central Office
436 Due to Regional Offices/Staff Bureaus
437 Due to Operating Units
439 Retirement Gratuity Benefits Payable
440 Deferred Credits to Income
441 Other Deferred Credits
448 * Deferred Real Property Tax Income
449 * Deferred Special Education Tax Income
450 Other Payables

** For Use of the Bureau of the Treasury
CHART OF ACCOUNTS
Account
Account Title
Code
Long -Term Liabilities
451 Loans Payable – Long-Term, Domestic

452 Loans Payable – Long-Term, Foreign
 Mortgage Payable
453
454 Bonds Payable – Long-Term, Domestic
455 Bonds Payable – Long-Term, Foreign
46 Other Long-Term Liabilities
Other Liabilities
465 Other Liabilities
EQUITY
501 Government Equity
502 * Project Equity
Intermediate Accounts
531 Cost of Goods Sold
532 Income and Expense Summary
533 Prior Years’ Adjustments
534 Retained Operating Surplus
* Invested Equity
537
538 Subsidy to Regional Offices/Staff Bureaus
539 Subsidy to Operating Units
540 Gain or Loss Due to Dormant Accounts
REVENUE / INCOME
GENERAL INCOME
601 Subsidy Income from National Government

602 Subsidy from Central Office
603 Subsidy from Regional Office/Staff Bureau
604 * Subsidy from Other LGUs
605 * Subsidy from Other Funds
606 * Subsidy from Special Accounts
611 Income from Government Services
612 Income from Government Business Operations
613 Sales Revenue
621 Rent Income
622 Insurance Income
623 Dividend Income
624 Interest Income
625 Gain on Sale of Securities
626 Gain on Sale of Assets
627 Sale of Confiscated Goods and Properties
628 Foreign Exchange (FOREX) Gain
639 Miscellaneous Operating and Service Income
*
For Use of the LGUs
CHART OF ACCOUNTS
Account
Account Title
Code
641 Fines and Penalties – Government Services and Business Operations

651 Income from Grants and Donations
SPECIFIC INCOME
Tax Revenue
Income Taxes
701 Income Tax – Individuals
702 Income Tax – Partnerships
703 Income Tax – Corporations
Property Taxes
711 * Real Property Tax
712 * Property Transfer Tax
713 * Special Education Tax
714 * Special Assessment Tax
* Real Property Tax on Idle Lands
715
716 Stock Transfers Tax
717 Capital Gains Tax
718 Donors Tax
719 Estate Tax
Taxes on Goods and Services

Excise Taxes on Articles
721
722 Value Added Tax
723 Business Taxes and Licenses
724 Franchise Tax
725 ** Professional Tax
726 ** Occupation Tax
727 ** Printing and Publication Tax
735 Miscellaneous Taxes on Goods and Services
Taxes on International Trade and Transactions

736 Import Duties
Other Taxes
741 Documentary Stamp Tax
742 * Community Tax
743 * Science Stamp Tax
745 * Weights and Measures
746 * Share from Internal Revenue Collections
747 * Share from Tobacco Excise Tax
748 * Share from Economic Zones
749 * Shares from Expanded Value Added Tax (EVAT)
750 * Share from National Wealth
751 * Amusement Tax
* Sand and Gravel Tax
752
*
For Use of the LGUs
*
For Use of the LGUs
CHART OF ACCOUNTS
Account
Account Title
Code
* Tax on Delivery Trucks and Vans

753
754 Tax on Forest Products
755 Immigration Taxes
759 Miscellaneous – Other Taxes
760 Fines and Penalties – Tax Revenue
Other Specific Income
761 Registration Fees

762 Tuition/Affiliation Fees
763 Hospital Fees
764 Medical, Dental and Laboratory Fees
765 Library Fees
766 Athletic and Cultural Fees
767 Comprehensive Examination Fees
768 Transcript of Records Fees
769 Diploma and Graduation Fees
770 Inspection Fees
771 Permit Fees
772 * Garbage Fees
773 Clearance/Certification Fees
774 Franchising/Licensing Fees
775 * Fishery Rentals, Fees and Charges
776 Printing and Publication Income
777 Income from Canteen Operations
778 Income from Dormitory Operations
779 * Receipts from Lease of Properties
780 Receipts from Communication Facilities
781 * Receipts from Waterworks Systems
782 * Receipts from Transportation Systems
783 * Receipts from Markets
784 * Receipts from Slaughterhouses
785 * Receipts from Cemeteries
786 Toll Fees
787 Landing and Parking Fees
788 Other Income from School Services
789 Other Income from School Business Operations
790 Other Income from Hospital Services
791 Other Income from Hospital Business Operations
792 * Other Specific Income of LGUs
799 Fines and Penalties – Other Specific Income
CHART OF ACCOUNTS
Account
Account Title
Code
EXPENSES
Personal Services
801 Salaries and Wages – Regular Pay
802 Salaries and Wages – Part Time Pay
803 Salaries and Wages – Casual/Contractual
804 Personnel Economic Relief Allowance (PERA)
805 Additional Compensation (ADCOM)
806 Representation Allowance (RA)
807 Transportation Allowance (TA)
808 Clothing Allowance
809 Honoraria
810 Hazard Pay
811 Overtime and Night Pay
812 Holiday Pay
813 Christmas Bonus
814 Cash Gift
815 Productivity Incentive Benefits
816 Other Bonuses and Allowances
817 Life and Retirement Insurance Contributions
818 PAG-IBIG Contributions
819 PHILHEALTH Contributions
820 ECC Contributions
821 Pension and Retirement Benefits
822 Terminal Leave Benefits
823 Health Workers’ Benefits
824 Subsistence and Quarters’ Allowances
825 Longevity Pay
830 Other Personnel Benefits

831 Traveling Expenses – Local
832 Traveling Expenses – Foreign
833 Training and Seminar Expenses
834 Water
835 Electricity
836 Cooking Gas
837 Telephone/Telegraph and Internet
838 Postage and Deliveries
839 Subscription Expenses
840 Advertising Expenses
841 Rent Expenses
842 Insurance Expenses
843 Fidelity Bond Premiums
844 Survey Expenses
845 Storage Expenses
846 Zoological/Animal Maintenance Expenses
847 Printing and Binding Expenses
848 Accountable Forms Expenses

CHART OF ACCOUNTS
Account
Account Title
Code
849 Office Supplies Expenses

850 Medical, Dental and Laboratory Supplies Expenses
851 Food/Non-food Expenses
852 Gasoline, Oil and Lubricants Expenses
853 Agricultural Supplies Expenses
854 Legal Services
855 Auditing Services
856 Consultancy Services
857 General Services
858 Security and Janitorial Services
859 Taxes, Duties and Licenses
860 Tax Credit Subsidy
861 Tax Exemption Expenses
862 Public Infrastructure Repairs and Maintenance
863 Reforestation Project Maintenance
864 Buildings Maintenance
865 School Buildings Maintenance
866 Markets and Slaughterhouses Maintenance
867 Hospitals and Health Centers Maintenance
868 Other Structures Maintenance
869 Industrial Machineries Maintenance
870 Other Machineries Maintenance
871 Firefighting Equipment and Accessories Maintenance
872 Construction and Heavy Equipment Maintenance
874 Technical and Scientific Equipment Maintenance
875 IT Equipment Maintenance
876 Telegraph, Telephone, Cable, TV and Radio Equipment Maintenance
877 Artesian Wells, Reservoirs, Pumping Stations and Conduits
Maintenance
878 Motor Vehicles Maintenance
879 Watercrafts Maintenance
880 Trains Maintenance
881 Aircrafts/Aircraft Ground Equipment Maintenance
882 Office Equipment Maintenance
883 Other Equipment Maintenance
884 Furniture and Fixtures Maintenance
885 Ordnance Maintenance
886 Other Repairs and Maintenance
887 Awards and Indemnities
888 Rewards and Other Claims
889 Grants and Donations
890 Representation Expenses
891 Extraordinary and Miscellaneous Expenses
892 Confidential and Intelligence Expenses
893 Anti-Insurgency/Contingency Expenses
894 Subsidy to National Government Agencies
895 Subsidy to Local Government Units
896 Subsidy to Government Corporations
* Subsidy to Other Funds
897
*
For use of the LGUs
CHART OF ACCOUNTS
Account
Account Title
Code
* Subsidy to Special Funds

898
901 Membership Dues to International Institutions
902 Depreciation – Land Improvements
903 Depreciation – Leasehold Improvements
904 Depreciation – Buildings
905 Depreciation – School Buildings
906 Depreciation – Markets and Slaughterhouses
907 Depreciation – Hospitals and Health Centers
908 Depreciation – Other Structures
909 Depreciation – Industrial Machineries
910 Depreciation – Other Machineries
911 Depreciation – Firefighting Equipment and Accessories
912 Depreciation – Construction and Heavy Equipment
914 Depreciation – Technical and Scientific Equipment
915 Depreciation – IT Equipment
916 Depreciation – Telegraph, Telephone, Cable, TV and
Radio Equipment
917 Depreciation – Artesian Wells, Reservoirs, Pumping Stations and
Conduits
918 Depreciation – Motor Vehicles
919 Depreciation – Watercrafts
920 Depreciation – Trains
921 Depreciation – Aircrafts/Aircraft Ground Equipment
922 Depreciation – Office Equipment
923 Depreciation – Other Equipment
924 Depreciation – Furniture and Fixtures
925 Depreciation – Ordnance
926 Depreciation – Books
927 Depreciation – Other Property, Plant and Equipment
928 Obsolescence – IT Software
929 Bad Debts Expense
937 * Discount on Real Property Tax
938 * Discount on Special Education Tax
947 Loss on Sale of Assets
948 Loss of Assets
950 Other Expenses
Financial Expenses
951 Bank Charges
952 Interest Expenses
953 Commitment Charges
954 Documentary Stamps Expenses
955 Other Financial Charges
956 Foreign Exchange (FOREX) Loss
957 Debt Service Subsidy to GOCCs
958 Loss on Guaranty
*
*
For Use of the LGUs
*
For Use of the LGUs
Chapter 10. DESCRIPTION OF ACCOUNTS

Description of Accounts. Each account in the Chart of Accounts is
defined/described. Instructions when to debit and credit the Balance Sheet
accounts, Intermediate accounts, Subsidy Income from National Government,
Subsidy from Central Office and Subsidy from Regional Office/Staff Bureau are
presented.
ASSETS
Current Assets
Cash
Cash in Treasury(101). This account is used to record collections of the Bureau of
the Treasury(BTr) pending deposits.
Debit Cash in Treasury (101)for:

Treasuries’ collections
Credit Cash in Treasury (101)for:

Deposits of collection to Bangko Sentral ng Pilipinas or Authorized
Government Depository Banks (AGDBs).
Cash – National Treasury, Modified Disbursement System (MDS) (102). This account
is used to record in the Regular Agency (RA) books the receipt of Notice of Cash
Allocation(NCA) from the Department of Budget and Management(DBM) and the
corresponding withdrawals of National Government Agencies(NGAs) against the NCA
received thru the issuance of MDS checks, and other modes of disbursements.
Debit National Treasury, Modified Disbursement System (MDS) (102)for:

Receipt of NCA from DBM
Receipt of Notice of Transferred Allocation to Agency/Regional Offices
(ROs)/Operating Units (OUs) from the Central Office (CO)
Credit National Treasury, Modified Disbursement System (MDS) (102)for:

MDS checks issued
ADA issued
Notice of Transferred Allocation issued by NGA Main Office to ROs/OUs

and/or attached offices thru Government Servicing Banks (GSB)
Reversion of unused/balance/expired portion of NCA
Cash – Bangko Sentral ng Pilipinas (103). This account is used to record deposits to
and withdrawals from the account maintained with the Bangko Sentral ng Pilipinas(BSP).
Debit Cash – Bangko Sentral ng Pilipinas (103)for:

Deposits with BSP
Credit advices/memos received from BSP
Credit Cash – Bangko Sentral ng Pilipinas (103)for:

Withdrawal or reduction of deposits with BSP
Debit advices/memos received from BSP
Petty Cash Fund (105). This account is used to record in the books of the agency the
cash granted to Regular or Special Disbursing Officers for the creation of Petty Cash Fund
(PCF), which shall be maintained under the Imprest System. Such Fund shall only be used
for payment of petty or miscellaneous authorized expenditures, which cannot be
conveniently paid by check.
Debit Petty Cash Fund (105) for:

Cash granted as PCF to duly designated Regular or Special
Disbursing Officers for payment of petty or miscellaneous
authorized expenditures
Replenishment in the ensuing year of expenses not replenished at the
end of the year
Credit Petty Cash Fund (105) for:
Adjusting entry to recognize expenses paid out of the PCF but not
replenished at the end of the year
Final liquidation/closing of the PCF
Cash – Collecting Officers (106). This account is used to record collections and deposits
made by Collecting Officers/ Postmasters/Telegraph Operators to the National Treasury
and/or AGDBs.
Debit Cash – Collecting Officers (106) for:

Collections made by Collecting Officers/Postmasters/Telegraph
Operators
Dishonored (checks) deposits based on the debit memo received from
the AGDBs
Credit Cash – Collecting Officers (106) for:

Deposits made by Collecting Officers for the account of the
Treasurer of the Philippines (TOP)
Deposits made by Collecting Officers with AGDBs
Cancellation of Official Receipts
Incurrence of cash shortage
Cash – Disbursing Officers (107). This account is used to record the amount of cash
advances granted to designate Regular or Special Disbursing Officers and disbursements
made in payment of authorized official expenditures.
Debit Cash – Disbursing Officers (107) for:

Cash advances to duly designated Regular or Special Disbursing
Officers for payment of salaries and wages
Cash advances to Postmasters and Telegraph Operators for authorized
disbursements
Cash advances to Special Disbursing Officers for specific purpose or
activity
Credit Cash – Disbursing Officers (107) for:

Liquidation/Authorized official payments made by Disbursing
Officers/Postmasters/Telegraph Operators
Refund of unused portion of advances upon completion of the
purpose/activity or at year-end
Incurrence of cash shortage
Cash in Bank – Local Currency, Current Account (110). This account is used to
record deposits/withdrawals of local currency in current account maintained with AGDBs.
Debit Cash in Bank – Local Currency, Current Account (110) for:

Deposits of local currency in current account
Credit advices/memos received
Interest earned net of withholding tax
Credit Cash in Bank – Local Currency, Current Account (110) for:

Commercial checks issued
Debit advices/memos received
Remittance of interest earned net of withholding tax to National
Treasury
Cash in Bank – Local Currency, Savings Account (111). This account is used to record
deposits/withdrawals of local currency in a savings account maintained with AGDBs.
Debit Cash in Bank – Local Currency, Savings Account (111) for:

Deposits of local currency in savings account
Credit Cash in Bank – Local Currency, Savings Account (111) for:

Withdrawals or authorized reduction of deposits
Remittance of interest earned net of withholding tax to the
National Treasury
Cash in Bank – Local Currency, Time Deposits (112). This account is used to record
placement in local currency of excess cash or cash not earmarked for immediate use with
AGDBs for a specified period.
Debit Cash in Bank – Local Currency, Time Deposits (112) for:
Deposits of local currency with AGDBs for a specific period
Credit Cash in Bank – Local Currency, Time Deposits (112) for:

Withdrawals of deposits or redemption at maturity
Remittance of interest earned net of withholding tax to the National
Treasury
Cash in Bank – Foreign Currency, Current Account (113). This account is used to
record deposits and withdrawals of foreign currency in current account maintained with
AGDBs.
Debit Cash in Bank – Foreign Currency, Current Account (113) for:

Deposits of foreign currency in current account
Credit Cash in Bank – Foreign Currency, Current Account (113) for:

Commercial checks issued
National Treasury
Cash in Bank – Foreign Currency, Savings Account (114). This account is used to
record deposits/withdrawals of foreign currency in savings account maintained with
AGDBs.
Debit Cash in Bank – Foreign Currency, Savings Account (114) for:

Deposits of foreign currency in savings account
Credit Cash in Bank – Foreign Currency, Savings Account (114) for:

Withdrawals or authorized reduction of deposits
National Treasury
Cash in Bank – Foreign Currency, Time Deposits (115). This account is used to
record placement of foreign currency maintained with AGDBs for a specified period.
Debit Cash in Bank – Foreign Currency, Time Deposits (115) for:
Deposits of foreign currency with AGDBs for a specific period

Credit Cash in Bank – Foreign Currency, Time Deposits (115) for:

Withdrawals or reduction of deposits due to redemption at maturity
National Treasury
Receivables
Accounts Receivable (121). This account is used to record the amount due from
customers/clients resulting from services rendered, trading/business transactions, and
sale of merchandise or property which are expected to be collected in the regular course
of business or over a definite period.
Debit Accounts Receivable (121) for:

Services rendered on account
Sale of merchandise or property on account
Other amounts due from customers/clients resulting from
trading/business transactions/operations
Credit Accounts Receivable (121) for:

Collection of the amount due from customers/clients
Authorized write-off of accounts
Notes Receivable (122). This account is used to record the value of promissory notes,
time drafts, trade acceptances and other negotiable short-term instruments from trade
debtors.
Debit Notes Receivable (122) for:

Value of promissory notes, time drafts, trade acceptances and other
negotiable short-term instruments received
Credit Notes Receivable (122) for:

Collections made from promissory notes, time drafts, trade
acceptances and other negotiable short-term instruments
Loans Receivable, Current (123). This account is used to record the amount of short-
term loans granted by the government to duly authorized recipients including LGUs,
GOCCs and authorized private entities in accordance with existing agreement.
Debit Loans Receivable, Current (123) for:

Short-term loans granted to duly authorized recipients including LGUs,
GOCCs and authorized private entities
Credit Loans Receivable, Current (123) for:

Collections made from the loans granted
Interests Receivable (126). This account is used to record the uncollected interest
earned from short-term/long-term investments.
Debit Interests Receivable (126) for:

Interest earned but not yet collected
Credit Interests Receivable (126) for:

Collection of the interest earned
Due from Officers and Employees (128). This account is used to record the amount due
from officers and employees of the agency and advances granted for official travels.
Debit Due from Officers and Employees (128) for:

Overpayment of salaries, fringe benefits and other emoluments
Cash shortages
Cash advances granted for travels (local and foreign) subject to
liquidation
Other receivables from officers and employees
Credit Due from Officers and Employees (128) for:

Collections of overpayment of salaries, fringe benefits and other
emoluments
Collections of cash shortages
Liquidation of cash advances for travel
Refund of excess/unused portion of cash advance for travels
Collection of receivables from officers and employees
Due from NGAs (130). This account is used to record the amount due from departments,
bureaus and other offices of the National Government.
Debit Due from NGAs (130) for:

Amount advanced for the account of NGAs
Overpayment to NGAs
Amount due arising from inter-agency and/or inter-office transactions
Credit Due from NGAs (130) for:

Collections of receivables from NGAs
Settlement of inter-agency and inter-office transactions
Due from LGUs (131). This account is used to record the amount due from provinces,
cities, municipalities, barangays and other LGUs.
Debit Due from LGUs (131) for:

Advances granted to LGUs
Subsidies granted to LGUs subject to liquidation
Overpayment to LGUs
Credit Due from LGUs (131) or:

Submission of liquidation reports by LGUs
Collections of receivables from LGUs
Due from GOCCs (132). This account is used to record the amounts of short-term loans
granted by the National Government to Government-Owned and/or Controlled
Corporations (GOCCs) and Government Financial Institutions (GFIs).
Debit Due from GOCCs (132) for:

Amount paid for the account of GOCCs/GFIs
Insurance claim from General Insurance Fund of GSIS
Overpayment to GOCCs/GFIs
Short-term loans granted to GOCCs/GFIs
Credit Due from GOCCs (132) for:

Collection of receivables from GOCCs/GFIs
Due from NGOs/POs (133). This account is used to record the release of funds entrusted
to Non-Governmental Organizations/Peoples’ Organizations (NGOs/POs) for the
implementation of government projects.
Debit Due from NGOs/POs (133) for:

Release of funds entrusted to NGOs/POs
Credit Due from NGOs/POs (133) for:

Liquidation of funds entrusted to NGOs/POs
Refund of unused fund
Due from National Treasury (134). This account is used to record the amount
deposited/remitted by government agencies with the National Treasury thru AGDB for
collections, which the agencies are authorized to use upon receipt of the NCA.
Debit Due from National Treasury (134) for:

Deposits/Remittances with the National Treasury of collections, which
the agencies are authorized to use
Credit Due from National Treasury (134) for:

Receipt of NCA
For identifying the particular receivables from the National Treasury, subsidiary ledgers by
nature of deposit shall be provided, such as cash performance bonds, grants and
donations, etc.
Due from Central Office (135). This account is used to record inter-office transactions in
the books of Regional Offices/Staff Bureaus/Operating Units (ROs/SBs/OUs).
Debit Due from Central Office (135) for:

Inter-office transactions
Credit Due from Central Office (135) for:

Due from Regional Offices/Staff Bureaus (136). This account is used to record inter-
office transactions in the books of CO/OUs. It also includes receivables from RO at year-
end equivalent to the unobligated balance of allotment covered by funding check.
Debit Due from Regional Offices/Staff Bureaus (136) for:

Receivables from RO/SB at year-end equivalent to the unobligated
balance of allotment covered by funding check
Credit Due from Regional Offices/Staff Bureaus (136) for:

Receipt of funds from RO/SB pertaining to unobligated
Due from Operating Units (137). This account is used to record inter-office transactions
in the books of Central/Regional Offices (CO/RO). It also includes receivables from OU at
year-end equivalent to the unobligated balance of allotment covered by funding check.
Debit Due from Operating Units (137) for:

Receivables from OU at year-end equivalent to the unobligated balance
of allotment covered by funding check
Credit Due from Operating Units (137) for:

Receipt of funds from OU pertaining to unobligated balance of
allotment covered by funding check
Receivables – Disallowances/Charges (138). This account is used to record the amount

due from officers and employees and those outside of government agencies for audit
disallowances/charges, which have become final and executory.
Debit Receivables – Disallowances/Charges (138) for:

Amount due from officers and employees resulting from audit
disallowances/charges, which have become final and executory
Amount due from contractors, suppliers or entities resulting from audit
disallowances/charges, which have become final and executory
Credit Receivables – Disallowances/Charges (138) for:

Cash settlement of audit disallowances/charges
Compliance to requirements or non-cash settlement
Other Receivables (139). This account is used to record the amount due from all other
debtors not falling under any of the specific types of receivables.
Debit Other Receivables (139) for:

Amounts due from debtors and entities which cannot be classified
under the specific receivable accounts
Credit Other Receivables (139) for:

Collections of amounts due from other debtors
Authorized write-off
Allowance for Doubtful Accounts (301). This account is used to record reduction in the
value of trade receivable accounts, which is estimated as uncollectible based on COA
standard/policies.
Debit Allowance for Doubtful Accounts (301) for:

Accounts of customers/clients which have been determined to be
uncollectible for which authority to write-off has been granted
Credit Allowance for Doubtful Accounts (301) for:

Estimated amount of uncollectible accounts
Treasury Bills (140). This account is used to record the authorized purchase/acquisition
by NGAs of short-term debt instruments issued by the National Government thru the BTr.
Debit Treasury Bills (140) for:

Cost of treasury bills purchased
Credit Treasury Bills (140) for:

Resale or disposition of treasury bills
Other Marketable Securities (143). This account is used to record the cost of other
marketable securities acquired as temporary investments by agencies.
Debit Other Marketable Securities (143) for:

Purchase of other types of authorized marketable securities
Credit Other Marketable Securities (143) for:

Sale or disposition of other types of marketable securities
Inventories
Raw Materials Inventory (144). This account is used to record the value of raw materials
purchased for use in production.
Debit Raw Materials Inventory (144) for:

Raw materials purchased for use in production
Credit Raw Materials Inventory (144 ) for:

Raw materials issued for use in production
Inventory shortage/loss
Work-In-Process Inventory (145). This account is used to record the cost and/or other
appropriate value of job or work orders which have been started but unfinished or still in
the process of manufacture as of the end of the accounting period.
Debit Work-In-Process Inventory (145) for:

Raw materials, labor and overhead put into production
Credit Work-In-Process Inventory (145) for:

Cost or value of the finished products
Finished Goods Inventory (146). This account is used to record the cost of completed
job or work orders and goods manufactured/produced/processed.
Debit Finished Goods Inventory (146) for:

Cost or value of the finished products
Credit Finished Goods Inventory (146) for:

Finished products transferred to Merchandise Inventory account
Finished products issued
Merchandise Inventory (147). This account is used to record the cost or other
appropriate value of merchandise and other property, which have been purchased or
produced for sale. It includes but not limited to drugs and medicines for hospitals/sanitaria
and finished products fabricated/manufactured/produced out of agency/ schools’
manufacturing operations which are intended for sale.
Debit Merchandise Inventory (147) for:

Articles purchased for sale
Goods or merchandise for sale which have been manufactured or
produced, conversion cost of which have been charged to
appropriations
Cost of drugs and medicines of hospitals/sanitaria for sale to patients
Credit Merchandise Inventory (147) for:

Sale/issuance or other modes of disposition of the above items
Accountable Forms Inventory (148). This account is used to record the cost or
appropriate value of accountable forms acquired/requisitioned for use in the course of
government operations and/or sale.
Debit Accountable Forms Inventory (148) for:

Cost or appropriate value of accountable forms
Credit Accountable Forms Inventory (148) for:

Sale/Issuance of accountable forms (at cost)
Transfer of inventory to ROs/OUs
Other modes of disposition
Office Supplies Inventory (149). This account is used to record the value of office
supplies, printed general forms, janitorial supplies, IT supplies and other supplies
purchased or acquired for use in the course of government operations.
Debit Office Supplies Inventory (149) for:

Purchase of office supplies and materials
Cost of office supplies and materials acquired free of charge or thru

donation
Credit Office Supplies Inventory (149) for:

Use/Consumption of the above items
Medical, Dental and Laboratory Supplies Inventory (150).This account is used to record
the appropriate value of medical, dental and laboratory supplies acquired for use in the
course of government operations. It includes drugs and medicines purchased for
consumption of hospital/sanitary/clinic/center and other items used in research activities.
Debit Medical, Dental and Laboratory Supplies Inventory (150) for:

Purchase of-
Medical and dental supplies
Drugs and medicines for clinic/hospital/sanitary/center
consumption
Laboratory supplies for use in research activities
Credit Medical, Dental and Laboratory Supplies Inventory (150) for:

Use/consumption of the above items
Food and Non-food Supplies Inventory (151). This account is used to record the
appropriate value of non-perishable food and non-food supplies inventory in hospitals
(Dietary Units) and penitentiary. It also includes those items purchased for distribution to
people affected by calamities/disasters/areas in conflict.
Debit Food and Non-food Supplies Inventory (151) for:

Purchase of food and non-food supplies for use by patients, inmates
and people affected in calamity-ridden areas
Credit Food and Non-food Supplies Inventory (151) for:

Use/Consumption
Gasoline, Oil and Lubricants Inventory (152). This account is used to record the
cost of gasoline, oil and lubricant, purchased for stock for issuance/consumption
in government operations.
Debit Gasoline, Oil and Lubricants Inventory (152) for:

Purchase of gasoline, oil and lubricants for stock to be consumed in
Credit Gasoline, Oil and Lubricants Inventory (152) for:

Use/Consumption
Agricultural Supplies Inventory (153).This account is used to record the cost or

appropriate value of agricultural supplies purchased or acquired thru donation for use in
the implementation of government programs.
Debit Agricultural Supplies Inventory (153) for:

Purchase or receipt of donated fertilizers and pesticides
Purchase or receipt of other donated agricultural supplies
Credit Agricultural Supplies Inventory (153) for:

Sale of fertilizers and pesticides and other agricultural supplies
Issuance or consumption for the implementation of projects
Livestock and Crops Inventory (154). This account is used to record the cost or
appropriate value of fruits/crops harvested and livestock acquired or purchased to be used
in the dispersal program/project of the government. It is also used to record livestock
produced and offered for sale upon reaching marketable age.
Debit Livestock and Crops Inventory (154)for:

Purchase or acquisition of livestock to be used in the dispersal
program/project of the government
Livestock offered for sale upon reaching marketable age
Value of offspring, harvested fruits and crops
Credit Livestock and Crops Inventory (154) for:

Issuance/Dispersal of livestock to the recipient
Sale of livestock/fruits and crops
For the purpose of identifying the particular asset account, the following sub-
accounts shall be used:
154 - 01 Livestock Inventory
154 - 02 Crops Inventory
Spare Parts Inventory (155). This account is used to record the cost or appropriate value
of spare parts purchased for the repair of vehicles, aircrafts, industrial machineries and
other equipment.
Debit Spare Parts Inventory (155) for:

Purchase of spare parts for use in the repair of vehicles, aircrafts,
industrial machineries and other equipment
Credit Spare Parts Inventory (155) for:

Issuance of spare parts
Construction Materials Inventory (156). This account is used to record the cost or
appropriate value of construction materials purchased for projects undertaken by
administration such as painting, carpentry/construction/plumbing and electrical supplies.
Debit Construction Materials Inventory (156) for:

Purchase of construction materials for projects undertaken by
administration
Return of items from the construction project to the stockroom
Credit Construction Materials Inventory (156 )for:

Issuance of construction materials
Other Agricultural Products Inventory (157). This account is used to record the cost or
appropriate value of produce from fishery and other agricultural operations, which are
intended for sale.
Debit Other Agricultural Products Inventory (157) for:

Inventory of produce from fishery and other agricultural operations
Credit Other Agricultural Products Inventory (157) for:

Sale or other modes of disposition of fish and other agricultural
product
Confiscated Goods Inventory (158). This account is used to record the cost or
appropriate value of confiscated goods and properties which are decided in favor of the
government.
Debit Confiscated Goods Inventory (158) for:

Confiscated goods and properties
Credit Confiscated Goods Inventory (158) for:

Sale of confiscated good and properties
Other modes of disposition of confiscated goods and properties
Other Inventory Items (160). This account is used to record the cost or appropriate value
of inventories which cannot be classified under specific inventory accounts like, among
others, forms (income tax returns, voters forms, etc.) brochures, printed leaflets for
information dissemination of the government projects/programs, scrap materials, motor
vehicles plates, car stickers, workbooks used in schools, etc.
Debit Other Inventory Items (160) for:

Inventory of forms/brochures/leaflets/motor vehicles plates/car
stickers, etc.
Inventory of workbooks for distribution to public schools
Inventory of scrap materials
Other inventory items
Credit Other Inventory Items (160) for:

Sale/Issuance of other inventory items
Prepaid Expenses
Prepaid Rent (161). This account is used to record the advance payment and deposit for
lease/rental of buildings, land, equipment, office space, vehicles and other property, plant
and equipment for use in government operations.
Debit Prepaid Rent (161) for:

Advance payment and deposit for lease/rental of buildings, land, office
space, equipment, vehicles and other properties for use in
Credit Prepaid Rent (161) for:

Prepaid Insurance (162). This account is used to record the advance payment for fidelity
bond premiums of accountable officers and insurance premiums of government
properties.
Debit Prepaid Insurance (162) for:

Advance payment for -
Fidelity bond premiums of accountable officers
Insurance premiums of government properties
Credit Prepaid Insurance (162) for:

Prepaid Interest (164). This account is used to record advance payment of interest for
loans contracted/guaranteed by the government.
Debit Prepaid Interest (164) for:
Interest payments made in advance for loans contracted/ guaranteed
by the government
Credit Prepaid Interest (164) for:

Other Prepaid Expenses (165). This account is used to record other prepaid expenses
not included in any specific prepaid accounts.
Debit Other Prepaid Expenses (165) for:

Other prepaid expenses
Credit Other Prepaid Expenses (165) for:

Expired portion of other prepaid expenses at the end of accounting
period
Guaranty Deposits (166). This account is used to record the amount of cash deposits,
subject to refund, made to secure or guaranty compliance with certain requirements in a
transaction.
Debit Guaranty Deposits (166) for:

Deposits for the exercise of an option to levy or lease
Deposits to secure coinage
Deposits to secure BSP Notes
Deposits to secure stocks and bonds of GOCCs
Other deposits to guaranty performance
Credit Guaranty Deposits (166) for:

Refund/Forfeiture of the above deposits
Deposits on Letters of Credit (167). This account is used to record deposits made for
the opening of letters of credit.
Debit Deposits on Letters of Credit (167) for:

Deposits made for opening domestic/foreign letters of credit
Credit Deposits on Letters of Credit (167) for:

Application/Utilization of deposits for domestic/foreign purchases
Advances to Contractors (168). This account is used to record the payment authorized
by law to be made in advance to contractors upon submission of the required bonds or
stand-by letter of credit.
Debit Advances to Contractors (168) for:

Payment of authorized advances to contractors
Credit Advances to Contractors (168) for:

Recoupment of authorized advances to contractors
Other Current Assets (170). This account is used to record deposits on containers and
other current assets which cannot be classified under specific current asset accounts.
Debit Other Current Assets (170) for:

Deposits on containers such as drums, gas, oxygen or acetylene
tanks, bottles and other containers
Other current assets, which cannot be classified under any of the
specific current asset accounts
Credit Other Current Assets (170) for:

Sale or disposition of the above items
Refund/Forfeiture of deposits made
Long-Term Investments
Loans Receivable – Long-Term, LGUs (171).This account is used to record long-term

loans granted/relent to LGUs by the National Government.
Debit Loans Receivable – Long-Term, LGUs (171) for:

Long-term loans granted to LGUs
Credit Loans Receivable – Long-Term, LGUs (171) for:

Collection of long-term loans granted/relent to LGUs
Loans Receivable – Long-Term, GOCCs (172).This account is used to record long-term

loans granted/relent to GOCCs by the National Government.
Debit Loans Receivable – Long-Term, GOCCs (172) for:

Long-term loans granted/relent to GOCCs
Credit Debit Loans Receivable – Long-Term, GOCCs (172) for:

Collection of long-term loans granted/relent to GOCCs
Loans Receivable – Long-Term, Others (173). This account is used to record

authorized long-term loans granted to private entities.
Debit Loans Receivable – Long-Term, Others (173) for:

Long-term loans granted/relent to private entities
Credit Loans Receivable – Long-Term, Others (173) for:

Collection of long-term loans granted/relent to private entities
Investments in Stocks (174). This account is used to record authorized long-term

investments in stocks of government and private corporations.
Debit Investments in Stocks (174) for:

Subscription to capital stocks of government and private corporations
Credit Investments in Stocks (174) for:

Sale of stocks
Investments in Bonds (175). This account is used to record long-term investments in

bonds of government and private institutions.
Debit Investments in Bonds (175) for:

Purchase of bonds issued by the government and private institutions
Credit Investments in Bonds (175) for:

Redemption of bonds
Resale of bonds
Investments in GOCCs (176). This account is used to record equity and other long-term
investments of the National Government to GOCCs.
Debit Investments in GOCCs (176) for:

Investments to GOCCs (non-stock)
Other long-term investments to GOCCs
Credit Investments in GOCCs (176) for:
Payments/Settlement received for investments
Sinking Fund – Cash (177). This account is used to record cash set aside for the
liquidation of long-term debt.
Debit Sinking Fund – Cash (177) for:

Setting aside of cash as sinking fund
Credit Sinking Fund – Cash (177) for:

Purchase of sinking fund securities for the purpose of temporary
investment
Liquidation of long-term debt
Sinking Fund – Securities (178). This account is used to record securities purchased
out of sinking fund to generate income while waiting for the liquidation of long-term
indebtedness.
Debit Sinking Fund – Securities (178) for:

Purchase of sinking fund securities
Credit Sinking Fund – Securities (178) for:
Redemption of securities
Sale of securities
Other Long-Term Investments (179). This account is used to record all other types of
long-term investments, which cannot be classified under specific investment accounts. It
includes cost of stocks/securities purchased from service enterprises as required before
service connection is made.
Debit Other Long-Term Investments (179) for:

All other types of long-term investment
Cost of stocks/securities purchased from power and telephone
companies and other service enterprises as required before service
connections is made or the needed service can be rendered
Credit Other Long-Term Investments (179) for:

Sale or disposition of other types of long-term investments
Sale or disposition of stocks/securities purchased for power and
telephone companies and other service enterprise
Land (201). This account is used to record the cost or appraised value or other appropriate
value of land acquired by the government including property rights and interests.
Debit Land (201) for:

Purchase of land
Transfer from government agencies, private entities and individuals
Transfer due to court order
Free acquisition/Donation
Credit Land (201) for:

Sale
Transfer to government agencies
Donation
Land Improvements (202). This account is used to record the cost or appropriate value
of land improvements, which are more or less permanent or capital in nature such as;
flagpoles, sidewalks, fences, driveways, parking areas, etc.
Debit Land Improvements (202) for:

Construction of land improvements
Transfer of land to where it was constructed by government agencies,
private entities and individuals
Credit Land Improvements (202) for:

Sale of land to where it was constructed
Transfer of land to government agencies
Involuntary destruction
Donation of land to where it was constructed
Accumulated Depreciation – Land Improvements (302). This account is used to record

the cumulative reduction in value of land improvements due to use in the course of
operation or in production of income.
Debit Accumulated Depreciation – Land Improvements (302) for:

Accumulated amount of depreciation charged against the land
improvements upon destruction or transfer/sale of land to where it
was constructed
Credit Accumulated Depreciation – Land Improvements (302) for:

Periodic charges as depreciation expense for land improvements
Leasehold Improvements (203). This account is used to record the cost or appropriate
value of improvements made on leased property.
Debit Leasehold Improvements (203) for:

Cost or appropriate value of improvements on leased property
Credit Leasehold Improvements (203) for:

Reduction of leasehold improvements due to destruction
Accumulated Depreciation – Leasehold Improvements (303). This account is used to

record the cumulative reduction in value of leasehold improvements due to use in the
course of operation or in production of income.
Debit Accumulated Depreciation for:

Accumulated amount of depreciation charged against the leasehold
improvements upon demolition or termination of the lease
Credit Accumulated Depreciation for:

Periodic charges as depreciation expense for leasehold improvements
(Depreciable life is the life of the leasehold improvement or the lease
agreement whichever is shorter.)
Buildings (204). This account is used to record the cost or appraised value of the
buildings purchased or constructed (other than school buildings, markets,
slaughterhouses, hospitals and health centers), including related improvements, which
are capital in nature.
Debit Buildings (204) for:

Purchase or construction of buildings
Additions, improvements, alterations, replacements, major repairs,
etc. which are capitalized when it extends the life, increase the
capacity or improve the efficiency or safety of the property
Free acquisition/donation received
Credit Buildings (204) for:

Sale
Demolition
Donation
Accumulated Depreciation – Buildings (304). This account is used to record the

cumulative reduction in value of buildings (other than school buildings, markets,
slaughterhouses, hospitals and health centers) due to use in the course of operation or in
production of income.
Debit Accumulated Depreciation – Buildings (304) for:

Accumulated amount of depreciation charged against the building
upon retirement, sale or demolition
Credit Accumulated Depreciation – Buildings (304) for:

Periodic charges as depreciation expense for buildings
School Buildings (205). This account is used to record the cost or appraised value of
school buildings purchased or constructed including related improvements, which are
capital in nature.
Debit School Buildings (205) for:

Purchase or construction of school buildings
Credit School Buildings (205) for:

Sale
Demolition
Donation
Accumulated Depreciation – School Buildings (305). This account is used to record

the cumulative reduction in value of school buildings due to use in the course of operation
or in the production of income.
Debit Accumulated Depreciation – School Buildings (305) for:

Cumulative amount of depreciation charged against the building upon
retirement, sale or demolition
Credit Accumulated Depreciation – School Buildings (305) for:

Periodic charges as depreciation expense for school buildings
Markets and Slaughter Houses (206). This account is used to record the cost or
appraised value of markets and slaughterhouses acquired or constructed.
Debit Markets and Slaughter Houses (206) for:

Purchase or construction of markets and slaughterhouses
Additions, improvements, alterations, replacements, major repairs, etc.
which are capitalized when it extends the life, increase the capacity
or improve the efficiency or safety of the property
Credit Markets and Slaughter Houses (206) for:

Sale
Donation
206 - 01 Markets
206 - 02 Slaughterhouses
Accumulated Depreciation – Markets and Slaughterhouses (306). This account is used

to record the cumulative reduction in value of markets and slaughterhouses due to use in
the course of operation or in production of income.
Debit Accumulated Depreciation for:

Cumulative amount of depreciation charged against markets and
slaughterhouses upon retirement, sale or demolition
Credit Accumulated Depreciation for:

Periodic charges as depreciation expense for markets and slaughter
houses
For the purpose of identifying the depreciation of the particular asset account, the
following sub-accounts shall be used:
306 - 01 Accumulated Depreciation - Markets
306 - 02 Accumulated Depreciation - Slaughterhouses
Hospitals and Health Centers (207). This account is used to record the cost or appraised
value of hospitals and health centers acquired or constructed.
Debit Hospitals and Health Centers (207) for:

Purchase or construction of hospitals and health centers
Credit Hospitals and Health Centers (207) for:

Sale
Demolition
Donation
207 - 01 Hospitals
207 - 02 Health Centers
Accumulated Depreciation – Hospitals and Health Centers (307). This account is used
to record the cumulative reduction in value of hospitals and health centers due to use in
the course of operation or in production of income.
Debit Accumulated Depreciation – Hospitals and Health Centers (307) for:

Cumulative amount of depreciation charged against hospitals and
health centers upon retirement, sale or demolition
Credit Accumulated Depreciation – Hospitals and Health Centers (307) for:

Periodic charges as depreciation expense for hospitals and health
centers
307 - 01 Accumulated Depreciation - Hospitals
307 - 02 Accumulated Depreciation - Health Centers
Other Structures (208). This account is used to record the cost or appraised value of
other structures acquired or constructed.
Debit Other Structures (208) for:

Purchase or construction of other structures

Credit Other Structures (208) for:

Sale
Demolition
Donation
Accumulated Depreciation – Other Structures (308). This account is used to record the
cumulative reduction in value of other structures due to use in the course of operation or
in production of income.
Debit Accumulated Depreciation – Other Structures (308) for:

Cumulative amount of depreciation charged against other structures
upon retirement, sale or demolition
Credit Accumulated Depreciation – Other Structures (308) for:

Periodic charges as depreciation expense for other structures
Industrial Machineries (209). This account is used to record the cost or appraised value
of industrial machineries acquired.
Debit Industrial Machineries (209) for:
Purchase of industrial machineries
Items found at station
Credit Industrial Machineries (209) for:

Sale
Donation
Accumulated Depreciation – Industrial Machineries (309).This account is used to record

the cumulative reduction in value of industrial machineries due to use in the course of
operation or in production of income.
Debit Accumulated Depreciation – Industrial Machineries (309) for:

Cumulative amount of depreciation charged against
industrial machineries upon retirement, sale or destruction.
Credit Accumulated Depreciation – Industrial Machineries (309) for:

Periodic charges as depreciation expense for industrial machineries
Other Machineries (210). This account is used to record the cost or appraised value of
other machineries and equipment acquired.
Debit Other Machineries (210) for:

Purchase of other machineries and equipment
Transfer from government/agencies, private entities and individuals

Credit Other Machineries (210) for:

Sale
Donation
Accumulated Depreciation – Other Machineries (310). This account is used to record

the cumulative reduction in value of machineries and equipment due to use in the course
of operation or in production of income.
Debit Accumulated Depreciation – Other Machineries (310) for:

Cumulative amount of depreciation charged against other machineries
upon retirement, sale or destruction
Credit Accumulated Depreciation – Other Machineries (310) for:

Periodic charges as depreciation expense for other machineries
Firefighting Equipment and Accessories (211). This account is used to record the cost
or appraised value of firefighting equipment and accessories acquired.
Debit Firefighting Equipment and Accessories (211) for:

Purchase of firefighting equipment and accessories
Credit Firefighting Equipment and Accessories (211) for:

Sale
Donation
211 - 01 Firefighting Equipment
211 - 02 Accessories
Accumulated Depreciation – Firefighting Equipment and Accessories (311). This

account is used to record the cumulative reduction in value of firefighting equipment and
accessories due to use in the course of operation or in production of income.
Debit Accumulated Depreciation – Firefighting Equipment and Accessories

(311) for:
Cumulative amount of depreciation charged against firefighting
equipment and accessories upon retirement, sale or destruction
Credit Accumulated Depreciation – Firefighting Equipment and Accessories

(311) for:
Periodic charges as depreciation expense for firefighting equipment
and accessories
311 - 01 Accumulated Depreciation - Firefighting Equipment
311 - 02 Accumulated Depreciation - Accessories
Construction and Heavy Equipment (212). This account is used to record the cost or
appraised value of construction and heavy equipment acquired.
Debit Construction and Heavy Equipment (212) for:

Purchase of construction equipment
Credit Construction and Heavy Equipment (212) for:

Sale
Donation
Accumulated Depreciation – Construction and Heavy Equipment (312). This account

is used to record the cumulative reduction in value of construction and heavy equipment
due to use in the course of operation or in production of income.
Debit Accumulated Depreciation – Construction and Heavy Equipment (312)

for:
Cumulative amount of depreciation charged against construction
equipment upon retirement, sale or destruction
Credit Accumulated Depreciation – Construction and Heavy Equipment

(312) for:
Periodic charges as depreciation expense for construction and heavy
equipment
Donation
Technical and Scientific Equipment (214). This account is used to record the cost or
appraised value of technical and scientific equipment acquired.
Debit Technical and Scientific Equipment (214) for:
Purchase of technical and scientific equipment
Credit Technical and Scientific Equipment (214) for:

Sale
Donation
214 - 01 Technical Equipment
214 - 02 Scientific Equipment
Accumulated Depreciation – Technical and Scientific Equipment (314). This account

is used to record the cumulative reduction in value of technical and scientific equipment
due to use in the course of operation or in production of income.
Debit Accumulated Depreciation – Technical and Scientific Equipment

(314)for:
Cumulative amount of depreciation charged against technical and

scientific equipment upon retirement, sale or destruction
Credit Accumulated Depreciation – Technical and Scientific Equipment

(314)for:
Periodic charges as depreciation expense for technical and scientific
equipment
314 - 01 Accumulated Depreciation - Technical Equipment
314 - 02 Accumulated Depreciation - Scientific Equipment
IT Equipment and Software (215). This account is used to record the cost or appraised
value of IT equipment and software acquired, purchased or developed.
Debit IT Equipment and Software (215) for:
Purchase of IT equipment and software including those developed by
the agency
Credit IT Equipment and Software (215) for:

Sale
Donation
215 - 01 IT equipment (from PCs to more complex
mainframes)
215 - 02 IT peripheral equipment ( such as printers,
external devices for back-up storage and
similar items)
215 - 02 Software (consisting of operating systems,
application software and the like)
Accumulated Depreciation – IT Equipment (315). This account is used to record the

cumulative reduction in value of IT equipment due to use in the course of operation or in
Debit Accumulated Depreciation – IT Equipment (315) for:
Cumulative amount of depreciation charged against IT equipment
upon retirement, sale, or destruction
Credit Accumulated Depreciation – IT Equipment (315) for:
Periodic charges as depreciation expense for IT equipment
Telegraph, Telephone, Cable, TV and Radio Equipment (216). This account is used to
record the cost or appraised value of telegraph, telephone, cable, TV and radio equipment
acquired.
Debit Telegraph, Telephone, Cable, TV and Radio Equipment (216) for:

Purchase of telegraph, telephone, cable, TV and radio equipment

Credit Telegraph, Telephone, Cable, TV and Radio Equipment (216) for:

Sale
Transfer to government agency
Donation
216 - 01 Telegraph
216 - 02 Telephone
216 - 03 Cable
216 - 04 TV
216 - 05 Radio Equipment
Accumulated Depreciation – Telegraph, Telephone, Cable, TV and Radio Equipment

(316). This account is used to record the cumulative reduction in value of telegraph,
telephone, cable, TV and radio equipment due to use in the course of operation or in
Debit Accumulated Depreciation – Telegraph, Telephone, Cable, TV and Radio

Equipment (316) for:
Cumulative amount of depreciation charged against telegraph,
telephone, TV cable and radio equipment upon retirement, sale or
destruction.
Credit Accumulated Depreciation – Telegraph, Telephone, Cable, TV and

Radio Equipment (316) for:
Periodic charges as depreciation expense for telegraph, telephone,
cable, TV and radio equipment
316 - 01 Accumulated Depreciation - Telegraph
316 - 02 Accumulated Depreciation - Telephone
316 - 03 Accumulated Depreciation - Cable
316 - 04 Accumulated Depreciation - TV
316 - 05 Accumulated Depreciation - Radio Equipment
Artesian Wells, Reservoirs, Pumping Stations and Conduits (217). This account is
used to record the cost or appraised value of artesian wells, reservoirs, pumping stations
and conduits acquired/constructed.
Debit Artesian Wells, Reservoirs, Pump Stations and Conduits (217) for:
Purchase/construction of artesian wells, reservoirs, pumping
stations and conduits
Transfer from government agencies, private entities and individual
Credit Artesian Wells, Reservoirs, Pump Stations and Conduits (217) for:
Sale
Donation
217 - 01 Artesian Wells
217 - 02 Reservoirs
217 - 03 Pumping Stations
217 - 04 Conduits
Accumulated Depreciation – Artesian Wells, Reservoirs, Pumping Stations and

Conduits (317). This account is used to record the cumulative reduction in value of
artesian wells, reservoirs, pumping stations and conduits due to use or in production of
income.
Debit Accumulated Depreciation – Artesian Wells, Reservoirs, Pumping

Stations and Conduits (317) for:
Cumulative amount of depreciation charged against artesian wells,
reservoirs, pumping stations and conduits upon retirement, sale or
destruction
Credit Accumulated Depreciation – Artesian Wells, Reservoirs, Pumping

Stations and Conduits (317) for:
Periodic charges as depreciation expense for artesian wells,
reservoirs, pumping stations and conduits
following sub-account shall be used:
317 - 01 Accumulated Depreciation - Artesian Wells
317 - 02 Accumulated Depreciation - Reservoirs
317 - 03 Accumulated Depreciation - Pumping Stations
317 - 04 Accumulated Depreciation - Conduits
Motor Vehicles (218). This account is used to record the cost or appraised value of motor
vehicles acquired.
Debit Motor Vehicles (218) for:

Purchase of motor vehicles

Credit Motor Vehicles (218) for:

Sale
Donation
Accumulated Depreciation – Motor Vehicles (318). This account is used to record the
cumulative reduction in value of motor vehicles due to use in operation or in production of
income.
Debit Accumulated Depreciation – Motor Vehicles (318)for:
Cumulative amount of depreciation charged against motor vehicles
Credit Accumulated Depreciation – Motor Vehicles (318)for:
Periodic charges as depreciation expense for motor vehicles
Watercrafts (219). This account is use to record the cost or appraised value of watercrafts
acquired.
Debit Watercrafts (219) for:

Purchase of watercrafts
Transfer from government agencies, private entities and
individuals
Credit Watercrafts (219) for:

Sale
Donation
Accumulated Depreciation – Watercrafts (319). This account is used to record the

cumulative reduction in value of watercrafts due to use in the course of operation or in
Debit Accumulated Depreciation – Watercrafts (319) for:
Cumulative amount of depreciation charged against watercrafts upon
retirement, sale or destruction
Credit Accumulated Depreciation – Watercrafts (319) for:

Periodic charges as depreciation expense for watercrafts
Trains (220). This account is used to record the cost or appraised value of trains acquired.
Debit Trains (220) for:

Purchase of trains
Credit Trains (220) for:

Sale
Donation
Accumulated Depreciation – Trains (320). This account is used to record the cumulative
reduction in value of trains due to use in the course of operation or in production of income.
Debit Accumulated Depreciation – Trains (320) for:

Cumulative amount of depreciation charged against trains upon
Credit Accumulated Depreciation – Trains (320) for:

Periodic charges as depreciation expense for trains
Aircrafts/Aircraft Ground Equipment (221). This account is used to record the cost or
appraised value of aircrafts/aircraft ground equipment acquired.
Debit Aircrafts/Aircraft Ground Equipment (221) for:

Purchase of aircrafts/aircraft ground equipment
Credit Aircrafts/Aircraft Ground Equipment (221) for:

Sale
Donation
221 - 01 Aircrafts
221 - 02 Aircraft Ground Equipment
Accumulated Depreciation – Aircrafts/Aircraft Ground Equipment (321). This

account is used to record the cumulative reduction in value of aircrafts/aircraft ground
equipment due to use in the course of operation or in production of income.
Debit Accumulated Depreciation – Aircrafts/Aircraft Ground Equipment (321)

for:
Cumulative amount of depreciation charged against aircrafts/aircraft
ground equipment upon retirement, sale or destruction
Credit Accumulated Depreciation – Aircrafts/Aircraft Ground Equipment

(321) for:
Periodic charges as depreciation expense for aircrafts/aircraft ground
equipment
321 - 01 Accumulated Depreciation – Aircrafts
321 - 02 Accumulated Depreciation – Aircraft Ground Equipment
Office Equipment (222). This account is used to record the cost or appraised value of
office equipment acquired or purchased.
Debit Office Equipment (222) for:
Purchase of office equipment

Credit Office Equipment (222) for:

Sale
Donation
Accumulated Depreciation – Office Equipment (322). This account is used to record

the cumulative reduction in value of office equipment due to use in operation or in
Debit Accumulated Depreciation – Office Equipment (322) for:

Cumulative amount of depreciation charged against office equipment
upon retirement, sale or destruction.
Credit Accumulated Depreciation – Office Equipment (322) for:

Periodic charges as depreciation expense for office equipment
Other Equipment (223). This account is used to record the cost or appraised value of
other equipment acquired not falling under specific property, plant and equipment
accounts.
Debit Other Equipment (223) for:

Purchase of other types of equipment
Credit Other Equipment (223) for:

Sale
Donation
Accumulated Depreciation – Other Equipment (323). This account is used to record

the cumulative reduction in value of other equipment due to use in operation or in
Debit Accumulated Depreciation – Other Equipment (323) for:

Cumulative amount of depreciation charged against other equipment
Credit Accumulated Depreciation – Other Equipment (323) for:

Periodic charges as depreciation expense for other equipment
Furniture and Fixtures (224). This account is used to record the cost or appraised
value of furniture and fixtures acquired.
Debit Furniture and Fixtures (224) for:

Purchase of furniture and fixtures
Credit Furniture and Fixtures (224) for:

Sale
Donation
224 - 01 Furniture
224 - 02 Fixtures
Accumulated Depreciation – Furniture and Fixtures (324). This account is used to

record the cumulative reduction in value of furniture and fixtures due to use in operation
or in production of income.
Debit Accumulated Depreciation – Furniture and Fixtures (324)for:

Cumulative amount of depreciation charged against furniture and
fixtures upon retirement, sale or destruction
Credit Accumulated Depreciation – Furniture and Fixtures (324) for:
Periodic charges as depreciation expense for furniture and fixtures
following sub-accounts shall be use:
324 - 01 Accumulated Depreciation - Furniture
324 - 02 Accumulated Depreciation - Fixtures
Ordnance (225). This account is used to record the cost or appraised value of ordnance
acquired.
Debit Ordnance (225) for:

Purchase of ordnance
Credit Ordnance (225) for:

Sale
Donation
Accumulated Depreciation – Ordnance (325). This account is used to record the

cumulative reduction in value of ordnance due to use in operation.
Debit Accumulated Depreciation – Ordnance (325) for:

Cumulative amount of depreciation charged against ordnance upon
Credit Accumulated Depreciation – Ordnance (325) for:

Periodic charges as depreciation expense for ordnance
Books (226). This account is used to record the cost or appraised value of books
acquired. This includes books in library of various schools, national agencies including
the National Library and those purchased for use by students with a serviceable life for
more than one year.
Debit Books (226). for:

Purchase of books
Credit Books (226) for:

Sale
Donation
Accumulated Depreciation – Books (326). This account is used to record the cumulative
reduction in value of books due to use in government operations or production of income.
Debit Accumulated Depreciation – Books (326) for:

Cumulative amount of depreciation charged against books upon
Credit Accumulated Depreciation – Books (326) for:

Periodic charges as depreciation expense for books
Other Property, Plant and Equipment (227). This account is used to record the cost or
appraised value of other property, plant and equipment acquired not falling under specific
Property, Plant and Equipment accounts.
Debit Other Property, Plant and Equipment (227) for:

Purchase of other property, plant and equipment
Transfer from government/agencies, private entities and individuals
Credit Other Property, Plant and Equipment (227) for:

Sale
Donation
Accumulated Depreciation – Other Property, Plant and Equipment (327). This

account is used to record the cumulative reduction in value of other property, plant and
equipment due to use in operation or in production of income.
Debit Accumulated Depreciation – Other Property, Plant and Equipment
(327) for:
Cumulative amount of depreciation charged against other property,
plant and equipment upon retirement, sale or destruction
Credit Accumulated Depreciation – Other Property, Plant and Equipment

(327) for:
Periodic charges as depreciation expense for other property, plant
and equipment
Work/Other Animals (228). This account is used to record the cost or appraised value of
work/other animals acquired or purchased. This includes those in the zoos, wildlife,
sanctuary, etc.
Debit Work/Other Animals (228) for:

Purchase of work/other animals
Offsprings
Work/Other animals found at station
Credit Work/Other Animals (228) for:

Sale
Death
Donation
228 - 01 Work Animals
228 - 02 Other Animals
Breeding Stocks (229). This account is use to record the cost or appraised value of
breeding stocks acquired.
Debit Breeding Stocks (229) for:

Purchase of breeding stocks
Offsprings
Breeding Stocks found at station
Credit Breeding Stocks (229) for:

Sale
Death
Donation
Construction in Progress – Agency Assets (230). This account is used to record the
cost or accumulated value of agency assets, which are still under construction.
Debit Construction in Progress – Agency Assets (230) for:

Materials, labor, overhead and other costs incurred while the asset is
under construction
Credit Construction in Progress – Agency Assets (230) for:

Transfer to appropriate agency asset account upon completion
For the purpose of identifying the particular asset accounts, the following sub-
230-01 Leasehold Improvements
230-02 Buildings
230-03 School Buildings
230-04 Markets and Slaughterhouses
230-05 Hospitals and Health Centers
230-09 Other Structures
Construction in Progress – Plaza, Parks and Monuments (231). This account is used
to record the cost or accumulated value of plaza, parks and monuments, which are still
under construction.
Debit Construction in Progress – Plaza, Parks and Monuments (231) for:

Cost incurred while the plaza, parks and monuments are under
construction
Credit Construction in Progress – Plaza, Parks and Monuments (231) for:

Transfer to Public Infrastructures account upon completion
231-01 Plaza
231-02 Parks
231-03 Monuments
Construction in Progress – Roads, Highways and Bridges (232). This account is used
to record the cost or accumulated value of roads, highways and bridges that are still under
construction.
Debit Construction in Progress – Roads, Highways and Bridges (232) for:

Cost incurred while the roads, highways and bridges are under
construction
Credit Construction in Progress – Roads, Highways and Bridges (232) for:

Transfer of discontinued infrastructure projects to Public
Infrastructures account
232-01 Roads
232-02 Highways
232-03 Bridges
Construction in Progress – Ports, Lighthouses, Harbors, Seawalls, River Walls and

Others (233). This account is used to record the cost or accumulated value of ports,
lighthouses, harbors, seawalls, river walls and other waterways improvements, which are
still under construction.
Debit Construction in Progress – Ports, Lighthouses, Harbors, Seawalls,

River Walls and Others (233) for:
Cost incurred while the ports, lighthouses, harbors, seawalls, river
walls and other waterways improvements are still under
construction
Credit Construction in Progress – Ports, Lighthouses, Harbors, Seawalls,

River Walls and Others (233) for:
233-01 Ports
233-02 Lighthouses
233-03 Harbors
233-04 Seawalls
233-05 River Walls
233-09 Others
Construction in Progress – Airports and Runways (234). This account is used to record
the cost or accumulated value of airports and runways, which are still under construction.
Debit Construction in Progress – Airports and Runways (234) for:

Cost incurred while the airports and runways are still under
construction
Credit Construction in Progress – Airports and Runways (234) for:

234-01 Airports
234-02 Runways
Construction in Progress – Railways (235). This account is used to record the cost or
accumulated value of railroad tracts, terminals and stations which are still under
construction.
Debit Construction in Progress – Railways (235) for:

Cost incurred while the railways are still under construction
Credit Construction in Progress – Railways (235) for:

Construction in Progress – Waterways, Aqueducts, etc. (236). This account is used to

record the cost or accumulated value of waterways, aqueducts, etc. which are still under
construction.
Debit Construction in Progress – Waterways, Aqueducts, etc. (236) for:
Cost incurred while the waterways, aqueducts, etc. are still under
construction
Credit Construction in Progress – Waterways, Aqueducts, etc. (236) for:

236-01 Aqueducts
236-02 Waterways
236-03 Others
Construction in Progress – Irrigation, Canals and Laterals (237). This account is used
to record the cost or accumulated value of irrigation, canals and laterals that are still under
construction.
Debit Construction in Progress – Irrigation, Canals and Laterals (237) for:

Cost incurred while the irrigation, canals and laterals are still under
construction
Credit Construction in Progress – Irrigation, Canals and Laterals (237) for:

237-01 Irrigation
237-02 Canals
237-03 Laterals
Construction in Progress – Electrification, Power and Energy Structures (238). This

account is used to record the cost or accumulated value of electrification, power, energy
and related structural projects which are still under construction.
Debit Construction in Progress – Electrification, Power and Energy

Structures (238) for:
Cost incurred while the electrification, power, energy structures and
related structural projects are still under construction
Credit Construction in Progress – Electrification, Power and Energy

Structures (238) for:
238-01 Electrification
238-02 Power
238-03 Energy Structures
Construction in Progress – Other Public Infrastructures (241). This account is used

to record the cost or accumulated value of all other Public Infrastructures not classified
under any specific type of public infrastructure accounts which are still under construction.
Debit Construction in Progress – Other Public Infrastructures (241) for:

Cost incurred while the other public infrastructures are still under
construction
Credit Construction in Progress – Other Public Infrastructures (241) for:

Construction in Progress – Reforestation Projects (242). This account is used to

record the cost or accumulated value of all Reforestation Projects which are still in
progress.
Debit Construction in Progress – Reforestation Projects (242) for:

Cost incurred while the Reforestation Projects are still in progress
Credit Construction in Progress – Reforestation Projects (242) for:

Transfer to Reforestation Projects account upon completion
Transfer of discontinued reforestation projects to Reforestation
Projects account
Public Infrastructures (243). This account is used to record completed/turned-over

public infrastructures projects and those projects, which were discontinued by the
government.
Debit Public Infrastructures (243) for:

Completed/turned-over public infrastructure projects
Discontinued public infrastructure projects
Credit Public Infrastructures (243) for:

Transfer of completed/turned-over/discontinued public infrastructures
to Registry of Public Infrastructures at the end of the accounting
period
Reforestation Projects (244). This account is used to record completed/turned-over

reforestation projects and those projects which were discontinued by the government.
Debit Reforestation Projects (244) for:

Completed/turned-over reforestation projects
Discontinued reforestation projects
Credit Reforestation Projects (244) for:

Transfer of completed/turned-over reforestation projects to Registry of
Reforestation Projects at the end of the accounting period.
Arts, Archeological Specimens and Other Exhibits (245). This account is used to
record the cost or accumulated value of art collections, literary masterpieces,
archeological specimens and other exhibits.
Debit Arts, Archeological Specimens and Other Exhibits (245) for:

Purchase of art collections, literary masterpieces,
archeological specimens and other exhibits
Free acquisition/Donations
Credit Arts, Archeological Specimens and Other Exhibits (245) for:

Sale

Donation
245-01 Art Collections
245-02 Literary Masterpieces
245-03 Archeological Specimens
245-04 Other Exhibits
Items in Transit (249). This account is used to record the cost or accumulated value of
imported equipment already paid but not yet delivered/received.
Debit Items in Transit (249) for:

Value or cost of imported equipment purchased or paid but not yet
delivered/received
Credit Items in Transit (249) for:

Value or cost of fixed assets delivered/received
Other Assets
Other Assets (251). This account is used to record the value of obsolete and
unserviceable assets awaiting final disposition as well as those assets still serviceable but
are no longer being used. These items are not subject to depreciation.
Debit Other Assets (251) for:

Cost of obsolete and unserviceable assets awaiting final disposition
including property and equipment no longer used in the agency
operation but still serviceable
Credit Other Assets (251) for:

Sale
Donation
LIABILITIES AND EQUITY
LIABILITIES
Current Liabilities
Accounts Payable (401). This account is used to record obligations/indebtedness to

contractors/suppliers arising from the purchase of goods and services and other
obligations in connection with the agencies’ operation/trade/business.
Debit Accounts Payable (401) for:

Payment/liquidation/settlement of obligations
Settlement thru authorized offsetting of transactions
Reversions
Credit Accounts Payable (401) for:

Amount of liabilities arising from goods delivered or services
rendered
Excess payments received from private entities
Liabilities arising from the cancellation of checks issued for which
replacement shall be made
For the purpose of identifying accounts, following sub-accounts shall be used:

401-01 Trade
401-02 Non-Trade
Notes Payable (402). This account is used to record liabilities arising from promissory
notes and trade acceptances.
Debit Notes Payable (402) for:

Payments made to settle promissory notes and trade acceptances
Reversions
Credit Notes Payable (402) for:

Value of promissory notes issued and trade acceptances
Loans Payable – Current, Domestic (403). This account is used to record the short-
term loan from domestic creditors. It includes the proceeds from the flotation/sale of
treasury bills.
Debit Loans Payable – Current, Domestic (403) for:

Settlement/Payment of loans/Redemption of treasury bills and notes
Credit Loans Payable – Current, Domestic (403) for:

Receipt of proceeds of short-term loans from domestic sources
Loans Payable – Current, Foreign (404). This account is used to record the short-term
loan from foreign governments or international financial institutions.
Debit Loans Payable – Current, Foreign (404) for:

Settlement/Payment of the loans
Credit Loans Payable – Current, Foreign (404) for:

Receipt of proceeds of short-term loans from foreign source
Interests Payable (406). This account is used to record charges imposed on the use of
money belonging to others, such as interests on bonds, provisional advances, treasury
bills, treasury notes, certificates of indebtedness, and other interest bearing obligations.
Debit Interests Payable (406) for:

Payments made to settle liabilities on interest
Credit Interests Payable (406) for:

Amount of interest due
Tax Refunds Payable (407). This account is used to record the estimated and actual
payment of tax refunds for the year based on the Special Provision for the Bureau of
Internal Revenue (BIR) in the General Appropriations Act.
Debit Tax Refunds Payable (407) for:

Payment of tax refunds
Credit Tax Refunds Payable (407) for:

Estimates of tax refunds for the year based on the Special Provision
for the BIR in the GAA
Guaranty Deposits Payable (408). This account is used to record cash received to
guaranty performance which are refundable/returnable to the depositor (such as deposits
on returnable containers, rental deposits, etc.) upon completion of the purpose for which
it was given or may be received to cover possible future damage to property.
Debit Guaranty Deposits Payable (408) for:

Refund of unused guaranty deposits
Refund/Forfeiture/Application of retention money/ guaranty deposits
Credit Guaranty Deposits Payable (408) for:

Deposits to guaranty performance of contracts
Contractors’ retention money
Tax Credit Certificates Payable (409). This account is used to record the issuance of
Tax Credit Certificates (TCCs) to a taxpayer entitled/qualified to avail of the tax credit or
duty drawback and tax incentives authorized under the National Internal Revenue Code,
Tariff and Customs Code of the Philippines, and the Omnibus Investment Code; the
utilization; and redemption of the TCCs.
Debit Tax Credit Certificates Payable (409) for:

Application of the certificate for payment of taxes and other qualified
obligations to the National Government
Redemption from the issuing agency
Encashment of the certificate
Lapsed certificates
Credit Tax Credit Certificates Payable (409) for:

Tax Credit Certificates issued for:
- overpayment of tax liability,
- taxes erroneously or illegally received,
- penalties imposed without authority or legal basis,
- prepaid duties or taxes on imported materials used in
manufacturing a product subsequently exported, as provided
for in the Tariff and Customs Code of the Philippines and
- other tax refunds authorized under existing laws and regulations
-
Tax Credit Certificates issued for investment incentive benefits
Withholding Taxes Payable (410). This account is used to record the liability for
collections received or amount of taxes withheld from officers and employees or other
parties for remittance to the BIR.
Debit Withholding Taxes Payable (410) for:

Remittance to the BIR of collections received or amounts withheld for
the account of the National Government
Issuance of Tax Remittance Advice (TRA)
Credit Withholding Taxes Payable (410) for:

Amounts collected/withheld from officers and employees
Amounts collected/withheld from private individuals/ companies on
the purchase of goods and services
For identifying the classification of withholding taxes payable subject to and not
subject to TRA, the following sub-accounts shall be used:
410-10 Subject to TRA 410-20 Not-Subject to TRA
410-11 Individual Withholding 410-21 Individual Withholding
Tax Tax
410-12 Contractors Tax 410-22 Contractors Tax
410-13 Franchise Tax 410-23 Franchise Tax
410-14 VAT 410-24 VAT
410-19 Other Taxes 410-29 Other Taxes
GSIS Payable (411). This account is used to record the liability for collections received or
amounts withheld from officers and employees and government contribution for remittance
to the Government Service Insurance System (GSIS).
Debit GSIS Payable (411). for:

Remittance of collections received or amount withheld for the account
of the GSIS
Remittance of government contribution to the GSIS
Credit GSIS Payable (411). for:

Amount collected/withheld from officers and employees for the
account of the GSIS
Amount representing government contribution to the GSIS
Amount due for fire insurance premium, group accident insurance
premium and hospitalization insurance premium
To identify the nature of collections or amount withheld, the following sub-

411- 01 Life and Retirement Insurance Premiums (Personal and Government
Share)
411 - 02 Optional Insurance Premiums
411 - 03 Salary Loan Installments
411 - 04 Policy Loan Installments
411 - 05 Optional Loan Installments
411 - 06 Real Estate Loan Installments
411 - 07 Emergency Loan Installments
411 - 08 Educational Loan Installments
411 - 09 Others
PAG-IBIG Payable (412). This account is used to record the liability for collections
received or amounts withheld from officers and employees and government share for
remittance to the Home Development Mutual Fund (HDMF).
Debit PAG-IBIG Payable (412) for:

Remittance of collections received or amounts withheld for the
account of the HDMF
Remittance of government contribution to the HDMF
Credit PAG-IBIG Payable (412) for:

Amounts collected/withheld from officers and employees for the
account of the HDMF
Amount representing government contribution to the HDMF
To identify nature of collection withheld, following sub-accounts shall be used:
412 - 01 PAG-IBIG Contributions (Personal and Government Share)
412 - 02 Multi-purpose Loan Installments
412 - 03 Housing Loan Installments
412 - 04 Emergency and Provident Loan Installments
412 - 05 Furniture and Appliance Loan Installments
412 - 09 Others
PHILHEALTH Payable (413). This account is used to record the liability for collections
received or amounts withheld from officers and employees and government share for
remittance to the Philippine Health Insurance Corporation (PHIC).
Debit PHILHEALTH Payable (413) for:

Remittance of collections received or amounts withheld for the
account of the PHIC
Remittance of government contribution to the PHIC
Credit PHILHEALTH Payable (413) for:
Amounts collected/withheld from officers and employees for the

account of PHIC
Amount representing government contribution to the PHIC
Performance/Bidders/Bail Bonds Payable (414). This account is used to record the

liability arising from receipt of cash bond to guarantee performance of the term of the
contract, participation in bidding, and compliance with court orders.
Debit Performance/Bidders/Bail Bonds Payable (414) for:

Refund of the bond
Forfeiture in case of non-compliance
Credit Performance/Bidders/Bail Bonds Payable (414) for:
Cash bond received to guarantee –
Performance of the term of the contract
Participation in bidding
Compliance with court orders
To identify nature of collections withheld, following sub-accounts shall be used:

414-01 Performance Bonds
414-02 Bidders Bonds
414-03 Bail Bonds
Due to Officers and Employees (428). This account is used to record the amount of
liabilities due to officers and employees of the agency.
Debit Due to Officers and Employees (428) for:

Payment or liquidation of obligations due to officers and employees
Settlement thru authorized offsetting of transactions
Credit Due to Officers and Employees (428) for:
Unpaid salaries, fringe benefits and other emoluments and other
obligations due to officials and employees of the agency
Liabilities arising from the cancellation of checks issued to officers
and employees subject to replacement
Due to NGAs (430). This account is used to record the amount of liabilities due to national
government agencies including inter-agency transferred funds received for the
implementation of specific programs/projects.
Debit Due to NGAs (430) for:

Payment of liabilities
Payment received to settle or liquidate liabilities due to NGAs
Settlement thru offsetting of inter-agency/inter-office transactions
Reversion of Payables
Refund of excess transferred funds
Credit Due to NGAs (430) for:

Amount due arising from inter-agency transferred fund
Receipt of goods delivered from national government agencies
Services rendered by national government agencies
Amounts due arising from inter-agency transactions
Liabilities arising from the cancellation of checks issued for which
replacement shall be made
For the purpose of identifying the various NGAs, individual sub-accounts shall be
maintained.
Due to LGUs (431). This account is used to record the amount of liabilities due to
LGUs. This includes collections received or amounts withheld for the account of
LGUs.
Debit Due to LGUs (431) for:

Payment/liquidation/settlement of liabilities due to LGUs

Reversion of payables
Replacement of stale/cancelled checks
Credit Due to LGUs (431) for:

Amounts received or collected for the account of LGUs
Receipt of goods from LGUs
Amount of liabilities arising from the cancellation of checks issued for
which replacement shall be made
For the purpose of identifying the various LGUs, individual sub-accounts shall
be maintained.
Due to GOCCs (432). This account is used to record amount of liabilities due to GOCCs.
This includes funds advanced or entrusted by government corporations to finance specific
projects or activities and amounts withheld from employees for the account of government
corporations other than GSIS, PHILHEALTH and PAG-IBIG.
Debit Due to GOCCs (432) for:

Payment/liquidation/settlement of liabilities due to GOCCs
Liquidation of the advances received from GOCCs
Remittance of amounts withheld from employees for the account of
government corp., other than GSIS, PHILHEALTH and PAG-IBIG.
Replacement of stale/cancelled checks
Credit Due to GOCCs (432) for:

Amounts withheld from employees for the account of government
corporations other than GSIS, PHILHEALTH and PAG-IBIG
Advances received from GOCCs for specific purposes or expenditures
Receipt of goods from GOCCs
Amount of liabilities arising from the cancellation of checks issued for
which replacement shall be made
For the purpose of identifying the various GOCCs, individual sub-accounts shall be
maintained.
Due to National Treasury (433). This account is used to record collections due for
remittance to National Treasury.
Debit Due to National Treasury (433) for:

Remittance of collections to the National Treasury
Credit Due to National Treasury (433) for:

Setting-up of liability due to the National Treasury
Due to Central Office (435). This account is used to record Inter-Office transactions in
the books of Regional Offices/Staff Bureaus/Operating Units (RO/SB/OU). It also includes
setting up of payable to CO at year-end equivalent to the unobligated balance of allotment
covered by funding check except those for continuing appropriation.
Debit Due to Central Office (435) for:

Inter-Office transactions
Remittance of funds to CO pertaining to unobligated balance of
Credit Due to Central Office (435) for:

Setting up of payables to CO at year-end equivalent to the unobligated
Due to Regional Offices/Staff Bureaus (436). This account is used to record Inter-Office
transactions in the books of Central Offices/Staff Bureaus/Operating Units (CO/SB/OU).
It also includes setting up of payable to RO at year-end equivalent to the unobligated
balance of allotment covered by funding check except those for continuing appropriations.
Debit Due to Regional Offices/Staff Bureaus (436) for:

Remittance of funds to RO by OU pertaining to unobligated balance of
Credit Due to Regional Offices/Staff Bureaus (436) for:

Setting up of payables to RO by OU at year-end equivalent to the
unobligated balance of allotment covered by funding check
Due to Operating Units (437). This account is used to record Inter-Office transactions in
the books of Central/Regional Offices (CO/RO) except those for continuing appropriations.
Debit Due to Operating Units (437) for:

Credit Due to Operating Units (437) for:

Retirement Gratuity Benefits Payable (439). This account is used to record claims of
retired government officers and employees for retirement gratuity benefits.
Debit Retirement Gratuity Benefits Payable (439) for:

Payment/settlement of retirement gratuity claims of retired government
officers and employees
Credit Retirement Gratuity Benefits Payable (439) for:

Amount set for claims of retirement gratuity of retired government
officers and employees
Deferred Credits to Income (440). This account is used to record amount collected for
revenues not yet earned.
Debit Deferred Credits to Income (440) for:

Income earned during the period
Credit Deferred Credits to Income for:

Collections for-
Services not yet rendered
Goods not yet delivered
Income not yet earned
Other Deferred Credits (441). This account is used to record collections received for
items not specifically included in account “Deferred Credits to Income”
Debit Other Deferred Credits (441) for:

Transfer to appropriate account
Credit Other Deferred Credits (441) for:

Collections for items not specifically included in account “Deferred
Credits to Income”
Other Payables (450). This account is used to record all other current liabilities not falling
in any of the specific current liability account including authorized deduction from salaries
and other liabilities of the government, payment of which are held in escrow.
Debit Other Payables (450) for:
Payments made to settle/liquidate liability
Credit Other Payables (450) for:

Authorized amount collected/withheld from officers and employees for
the account of private associations/ entities
Amount due which had arisen from court order
Amount due for deposits held in escrow
Long-Term Liabilities
Loans Payable – Long-Term, Domestic (451). This account is used to record long-term
indebtedness (loans in cash or in kind) from domestic creditors evidenced by a contract
or an agreement.
Debit Long-Term, Domestic (451) for:

Settlement/Payment of matured portion of the loan
Credit Long-Term, Domestic (451) for:

Receipt of the proceeds of long-term loans from domestic sources
Loans Payable – Long-Term, Foreign (452). This account is used to record long-term
indebtedness/loans (in cash or in kind) from foreign governments or international financial
institutions evidenced by a contract or an agreement.
Debit Loans Payable – Long-Term, Foreign (452) for:

Settlement/Payment of matured portion of the loan
Decrease in liability due to FOREX gain upon revaluation
Credit Loans Payable – Long-Term, Foreign (452) for:

Receipt of the proceed of long-term loans from foreign sources
Increase in liability due to FOREX loss upon revaluation
Mortgage Payable (453). This account is used to record long-term indebtedness covered
by a contract and secured by a collateral to guarantee payment.
Debit Mortgage Payable (453) for:

Settlement/Payment of the loan
Credit Mortgage Payable (453) for:
Amounts received in exchange of the collateral
Bonds Payable – Long-Term, Domestic (454). This account is used to record the
amount of long-term indebtedness to domestic creditors for bonds issued.
Debit Bonds Payable – Long-Term, Domestic (454) for:

Settlement/Payment of matured bonds
Credit Bonds Payable – Long-Term, Domestic (454) for:

Bonds issued/floated
Bonds Payable – Long-Term, Foreign (455). This account is used to record the amount
of long-term indebtedness to foreign creditors for bonds issued.
Debit Bonds Payable – Long-Term, Foreign (455) for:

Settlement/Payment of the matured bonds
Decrease in liability due to FOREX gain upon revaluation
Credit Bonds Payable – Long-Term, Foreign (455) for:

Bonds issued/floated to foreign creditors
Increase in liability due to FOREX loss upon revaluation
Other Long-Term Liabilities (460). This account is used to record all other long-term
liabilities not falling under any of the specific long-term liability accounts.
Debit Other Long-Term Liabilities for:

Settlement/Payment of the long-term liabilities
Credit Other Long-Term Liabilities for:

Incurrence of other long-term liabilities not classified under specific
accounts
Other Liabilities
Other Liabilities (465). This account is used to record the other liabilities which cannot
be classified under specific liability accounts like Back pay Certificates of the BTr.
Debit Other Liabilities (465) for:
Payment of liabilities
Credit Other Liabilities (465) for:

Incurrence of liabilities not classified under specific liability accounts
EQUITY
Government Equity (501). This account represents the difference between the assets
and liabilities of national government agencies.
Debit Government Equity (501) for:

Transfer of Public Infrastructures/Reforestation Projects account to the
Registry of Public Infrastructures/ Reforestation Projects
Year-end closing of the debit balance of Retained Operating Surplus
account
Credit Government Equity (501) for:

Year-end closing of the credit balance of Retained Operating Surplus
account
Intermediate Accounts
Cost of Goods Sold (531). This account is used to record the cost of goods or
merchandise sold in the course of business operation of government agency such as
drugs and medicines, supplies and materials, accountable forms with face value, etc.
Debit Cost of Goods Sold (531) for:

Cost of merchandise/accountable forms sold
Credit Cost of Goods Sold (531) for:

Year-end closing to Income and Expenses Summary account
Income and Expense Summary (532). This account is used as a summary account for
all subsidies received, revenues earned and expenses incurred during the year.
Debit Income and Expense Summary (532) for:

Year-end closing of the balances of-
Expenses incurred during the year
Cost of Goods Sold
Subsidy to Regional Offices/Staff Bureaus
Subsidy to Operating Units
Year-end closing of the credit balance (net result) of this account to
Retained Operating Surplus account
Credit Income and Expense Summary (532) for:

Year-end closing of the balances of-

Subsidy Income from National Government
Revenue earned during the year
Subsidy from Central Office
Subsidy from Regional Offices/Staff Bureaus
Year-end closing of the debit balance (net result) of this account to
Retained Operating Surplus account
Prior Years’ Adjustments (533). This account is used to record the adjustment of prior
years’ transactions affecting revenue and expenses and other adjustments which would
increase or decrease the Retained Operating Surplus account of the Government.
Debit Prior Years’ Adjustments (533) for:

Adjustment of excess revenue recorded in prior years
Setting-up of liability due to excess income collected and remitted to
the National Treasury in prior years for refund to Payor
Payment of unrecorded expenses of prior years
Setting-up of liability for unrecorded expenses of prior years
Remittance of -
Refund of cash advance granted in prior years
Refund of overpayment of expenses pertaining to prior years
Cash settlement of disallowances of prior years
Other adjustments of prior years’ transactions which result in the
decrease of the Retained Operating Surplus account
Year-end closing of the credit balance (net result) of this
account to Retained Operating Surplus account
Credit Prior Years’ Adjustments (533) for:

Setting-up of receivable account for disallowances of prior years
expenses
Collection of prior years’ disallowances and refund of overpayments of
expenses pertaining to prior years
Other adjustments of prior years’ transactions, which result in the
increase of the Retained Operating Surplus
Retained Operating Surplus
Recoveries of prior years’ accounts which were previously written-off
Retained Operating Surplus (534). This account reflects the net result of Income and
Expense Summary and Prior Years’ Adjustments accounts prior to closing to Government
Equity Account.
Debit Retained Operating Surplus (534) for:

Year-end closing of the credit balance (net result) of this account to
Government Equity account
Year-end closing of the debit balance (net result) of Prior Years’
Adjustments account
Credit Retained Operating Surplus (534) for:

Government Equity account
Year-end closing of the credit balance of Prior Years’ Adjustments
account
Subsidy to Regional Offices/Staff Bureaus (538). This account is used by the Central
Office to record the amount of funds/assets transferred to the Regional Offices/Staff
Bureaus of an agency or department for its operation.
Debit Subsidy to Regional Offices/Staff Bureaus (538) for:

Transfer of funds to the Regional Offices of department/
agency
Transfer of funds to the Staff Bureau of a department
Credit Subsidy to Regional Offices/Staff Bureaus (538) for:

Setting-up of liability to CO equivalent to the unobligated balance of
Year-end adjustment upon remittance of cash equivalent to the
obligated balance of allotment covered by funding checks
Year-end closing to Income and Expense Summary account
Subsidy to Operating Units (539). This account is used by the Central Office/Regional
Office to record the amount of funds/assets transferred to the Operating Units of an agency
or department for its operation.
Debit Subsidy to Operating Units (539) for:

Transfer of funds to the Operating Units of an agency or department
Credit Subsidy to Operating Units (539) for:

Year-end adjustment upon remittance of cash or setting up of liability
to RO/CO equivalent to the unobligated balance of allotment
covered by funding checks
Gain or Loss due to Dormant Accounts (540). This account is used to record transfer
of dormant assets/liabilities to the Registry of Dormant Accounts in accordance with
existing rules and regulations.
Debit Gain or Loss due to Dormant Accounts (540) for:

Transfer of dormant assets to Registry of Dormant Accounts
Year-end closing of credit balance (net result) to Retained Operating
Surplus account
Credit Gain or Loss due to Dormant Accounts (540) for:

Transfer of dormant liabilities to Registry of Dormant Accounts
Year-end closing of the debit balance (net result)) to Retained Operating
Surplus account
REVENUE / INCOME
GENERAL INCOME
Subsidy Income from National Government (601). This account is used to record the
amount of Notice of Cash Allocation (NCA) received, Tax Remittance Advice (TRA)
issued, tax exemption granted by the National Government and payment of national
government agencies’ liabilities by foreign lending/donor institutions.
Debit Subsidy Income from National Government (601) for:

Remittance of -
Refund of cash advance granted in current year
Refund of overpayment of expenses pertaining to current year
Cash settlement of disallowances of current year
Closing/Reversion of unused balance of subsidy/NCA at
expiry/date/year-end
Year-end closing of used subsidy/NCA to Income and Expense
Summary account
Credit Subsidy Income from National Government (601) for:

Receipt of NCA for current year’s operation
Receipt of NCA for prior year’s accounts payable
Issuance of TRA by National Government Agencies
Grant of tax exemption for importation of goods/equipment
Receipt of withdrawal application from the BTr for payment by foreign
lending/donor institutions of government agencies
Subsidy from Central Office (602). This account is used to record the subsidy received
by the Regional Office/Staff Bureau and Operating Unit from Central Office by way of
funding check received/fund transfer thru Authorized Government Servicing Banks
(AGSBs)/transfer of assets
Debit Subsidy from Central Office (602) for:

Remittance of –
Year-end adjustment upon remittance of cash/setting up of liability
equivalent to the unobligated balance of allotment covered by
funding check
Credit Subsidy from Central Office (602) for:

Receipt of subsidy thru funding check/fund transfer from Central
Office
Subsidy from Regional Office/Staff Bureau (603). This account is used to record the
subsidy received by the Operating Unit from the Regional Office/Staff Bureau by way of
funding check or fund transfer thru AGSBs or transfer of assets.
Debit Subsidy from Regional Office/Staff Bureau (603) for:

Remittance of –
Year-end adjustment upon remittance of cash/setting up of liability
equivalent to the unobligated balance of allotment covered by
funding check/fund transfer
Year-end closing to Income and Expense Summary
Credit Subsidy from Regional Office/Staff Bureau (603) for:

Receipt of subsidy from Regional Office/Staff Bureau
Income from Government Services (611). This account is used to record all types of
revenues generated by the government in the exercise of its administrative and regulatory
functions. Example of this type of income are: surveyors or cadastral fees, registration
fees, naturalization fees, police clearance fees, passports fees, courts fees, certifications
fees, admission fees to government museums, parks, cultural and recreational facilities,
production share for energy exploration projects, etc.
Income from Government Business Operations (612). This account is used to record
revenue generated by government agencies from business operation, such as spectrum
fees, suspension fees, sale of plants and other farm products, receipts from public utilities,
etc.
Sales Revenue (613). This account is used to record all income derived from business
operations of agencies engaged in trade, business and commerce.
Rent Income (621). This account is used to record rent earned from lease of property
such as; lands, buildings, machineries and equipment to other government agencies, non-
government organizations and the private sector.
Insurance Income (622). This account is used to record all premiums earned from life
insurance, fidelity, medicare, employees’ compensation, third party liability, property and
other non-life insurance and reinsurance.
Dividend Income (623). This account is used to record cash dividends earned from
investments on stocks of government corporations and private enterprises.
Interest Income (624). This account is used to record all interest earned on deposits with
banks, loans and investments on bonds, treasury notes, treasury bills and promissory
notes held.
Gain on Sale of Securities (625). This account is used to record the gains realized on
the sale of bonds and securities including stocks/securities secured from service
enterprises as required before service connection is made.
Gain on Sale of Assets (626). This account is used to record the excess of the proceeds
from sale of assets over their net book value (accumulated depreciation deducted).
Sale of Confiscated Goods and Properties (627). This account is used to record
income derived from the sale of goods/properties confiscated and decided in favor of the
government.
Foreign Exchange (FOREX) Gain (628). This account is used to record gains in the
conversion of foreign currencies to Philippine Peso. In the case of revaluation of the
outstanding foreign loans, it is the resulting difference when the prevailing exchange rate
is lower than the exchange rate at the time of the transactions or last adjustment.
Miscellaneous Operating and Service Income (639). This account is used to record all
other income from non-tax sources not elsewhere classified.
Fines and Penalties – Government Services and Business Operations (641). This
account is used to record all fines and penalties levied in connection with non-tax sources
of income/revenue.
Income from Grants and Donations (651). This account is used to record all non-
repayable grants, donations in cash and in kind received from other levels of government,
private sector or international institutions.
SPECIFIC INCOME - TAX REVENUE

(For recording only in the NG Books)
Income Taxes
Income Tax – Individuals (701). This account is used to record income taxes imposed
on individual taxpayers including citizens, resident aliens, non-resident citizens for income
in and outside the Philippines, non-resident aliens for income earned in the Philippines,
aliens employed by Regional or Area Headquarters and Regional Operating Headquarters
of multi-national corporations.
Income Tax – Partnerships (702). This account is used to record taxes imposed on
income from partnerships’ business operations during the year or period covered by the
return.
Income Tax – Corporations (703). This account is used to record taxes imposed on
income from business operations during the year or period by domestic corporations,
private educational institutions, resident foreign corporations, international carriers, and
non-resident foreign corporations.
Property Taxes
Stock Transfers Tax (716). This account is used to record taxes imposed on the transfer
of stock from one person to another as recorded in the Stock and Transfer Book of the
corporation pursuant to Section 127, National Internal Revenue Code (NIRC) of the
Philippines.
Capital Gains Tax (717). This account is used to record taxes imposed on gains realized
by the seller from the sale, exchange, or other disposition of capital assets located in the
Philippines, including pacto de retro sales and other forms of conditional sale.
Donors Tax (718). This account is used to record taxes on a donation or gift imposed on
the gratuitous transfer of property between two or more persons who are living at the time
of the transfer.
Estate Tax (719). This account is used to record taxes imposed on the right of the
deceased person to transmit his/her estate to his/her lawful heirs and beneficiaries at the
time of death and on certain transfers which are made by law as equivalent to
testamentary disposition.
Taxes On Goods and Services

Excise Taxes on Articles (721). This account is used to record taxes imposed on goods
manufactured or produced in the country for domestic sale or consumption or for any other
disposition and items imported (Section 129, NIRC of the Philippines). The excise tax is
in addition to the value added tax. Articles subject to excise tax include alcohol products,
wines, fermented liquor, tobacco products, cigar and cigarettes, films, saccharine, mineral
products, automobiles, and certain non-essentials like jewelry, perfumes, yachts and other
vessels intended for pleasure or sports.
Value Added Tax (722). This account is used to record taxes levied, assessed and
collected on every sale, barter or exchange of goods, properties and services payable by
the seller, lessor, or transferor. It is imposed at every stage of distribution process on the
sale, barter, exchange (including any other transaction deemed by law as sale), or lease
of goods or properties and on the performance of service in the course of trade or
business, or on the importation of goods, whether for business or non-business purposes
pursuant to Section 105, NIRC of the Philippines.
Business Taxes and Licenses (723). This account is used to record taxes imposed and
collected on every sale, barter or exchange of goods subject to VAT; importation of goods
subject to VAT; and sale of services subject to VAT such as services rendered or
performed by construction and service contractors; stock, real estate, commercial,
customs and immigration brokers; lessors or distributors of cinematographic films; persons
engaged in milling, processing, manufacturing or repacking goods for others; and similar
services, regardless of whether or not the performance thereof calls for the exercise or
use of the physical and mental faculties.
This account is also used to record taxes imposed on certain taxpayers subject
to other percentage taxes such as operators of hotels, motels, rest houses, pension
houses, lodging houses and resorts; proprietors and operators of restaurants,
refreshment parlors and other eating places, including clubs and caterers; common
carriers and transportation contractors; dealers in securities; lending investors; banks
and non-bank financial intermediaries; finance companies; insurance companies; agents
of foreign insurance companies; operators of amusement places; persons who wins in
horse races and owners of winning horses; sellers of goods and services exempt from
value added tax under Sec. 109 of the NIRC which are not VAT- registered.
Franchise Tax (724). This account is used to record taxes and charges collected on
account of special privilege or right conferred to an individual or corporation by the state,
through the legislature, to exercise certain powers and privileges such as the power to
operate public utilities.
Miscellaneous Taxes on Goods and Services (735). This account is used to record
other taxes and charges imposed on goods and services.
Taxes on International Trade and Transactions

Import Duties (736). This account is used to record levies imposed under the Tariff Code
on goods that are entering the country for purposes of protecting locally manufactured
goods of similar nature or for purposes of generating revenues that are based on the
assessed value of the goods.
Other Taxes
Documentary Stamp Tax (741). This account is used to record stamp tax levied upon
documents, instruments, loan agreements and papers, and upon acceptances,
assignments, sales and transfers of the obligation, right or property incident thereto, on
bonds, debentures, certificate of stocks, life insurance policies, etc. pursuant to Section
173 to 198, NIRC of the Philippines.
Taxes on Forest Products (754). This account is used to record all taxes charged on
timber and firewood cut in public forests and wood cut from unregistered private lands,
and on other forest products lawfully removed under gratuitous licenses pursuant to
Sec. 262-273 of Commonwealth Act (CA) No. 466, as amended.
Immigration Taxes (755). This account is used to record all taxes and other charges
imposed to immigrants under the immigration laws.
Miscellaneous – Other Taxes (759). This account is used to record other taxes and
charges not classified under specific tax accounts.
Fines and Penalties – Tax Revenue (760). This account is used to record all fines and
penalties charge/imposed in relation to tax revenue. It also includes bank penalties due to
late remittance of taxes collected thru AGDBs to the National Treasury.
Other Specific Income

Registration Fees (761). This account is used to record motor vehicle users’ charge
collected by the Land Transportation Office and registration fees collected by schools.
Tuition/Affiliation Fees (762). This account is used to record tuition/affiliation fees

received from students of State Universities and Colleges (SUCS) and other government
run schools.
Hospital Fees (763). This account is used to record regular charges by hospitals for
services rendered to patients.
Medical, Dental and Laboratory Fees (764). This account is used to record fees received
for medical, dental and laboratory examinations.
Library Fees (765). This account is used to record fees received by schools and other
agencies for use of the library.
Athletic and Cultural Fees (766). This account is used to record fees collected from
students for athletic and cultural activities.
Comprehensive Examination Fees (767). This account is used to record fees collected
from students and professionals for the conduct of comprehensive examinations.
Transcript of Records Fees (768). This account is used to record fees collected from
students for the issuance of transcript of records.
Diploma and Graduation Fees (769). This account is used to record fees collected from
students for the issuance of diploma and conduct of graduation activities.
Inspection Fees (770). This account is used to record fees collected for the conduct of
inspection by authorized government officials.
Permit Fees (771). This account is used to record fees collected for the issuance of
permits by authorized government agencies.
Clearance/Certification Fees (773). This account is used to record fees collected from
the issuance of clearances/ certificates to
individuals/organizations/groups/agencies/corporations by government agencies.
Franchising/Licensing Fees (774). This account is used to record fees realized from the
issuance of franchises/licenses to individuals/organizations/
groups/agencies/corporations by government agencies.
Printing and Publication Income (776). This account is used to record receipts from sale
of printed forms, materials and other publications produced by government agencies.
Income from Canteen Operations (777). This account is used to record income of
canteen/cafeteria/eatery operated by government agencies.
Income from Dormitory Operations (778). This account is used to record collections by
dormitories/lodging houses/hostels owned and operated by government agencies.
Receipt from Communication Facilities (780). This account is used to record income
realized from use of communication facilities owned by government agencies.
Toll Fees (786). This account is used to record fees collected for use of roads, bridges,
ferries and piers constructed/owned and managed by government agencies.
Landing and Parking Fees (787). This account is used to record income realized from
the use of runways and airports by foreign and domestic airlines.
Other Income from School Services (788). This account is used to record other income
for services rendered by schools, colleges and universities not classified under any of the
specific income accounts.
Other Income from School Business Operations (789). This account is used to record
other income from business operations of schools, colleges and universities not classified
under any of the specific income accounts.
Other Income from Hospital Services (790). This account is used to record income from
other services rendered by hospital not classified under any of the specific income
accounts.
Other Income from Hospital Business Operations (791). This account is used to record
income from other business operations of hospitals not classified under any of the specific
income accounts.
Fines and Penalties – Other Specific Income (799). This account is used to record all
collections of fines and penalties charged/imposed in relation to other specific income
accounts.
EXPENSES
Personal Services
Salaries and Wages – Regular Pay (801). This account is used to record the pay proper
of regular government employees for services rendered.
Salaries and Wages – Part Time Pay (802). This account is used to record the pay
proper of part-time government employees for services rendered.
alaries and Wages-Casual/Contractual (803). This account is used to record the pay
proper of casual and contractual government employees for services rendered.
Personnel Economic Relief Allowance (PERA) (804). This account is used to record
allowances granted to all appointive national government employees occupying itemized
plantilla positions, casual and contractual employees and uniformed personnel of the AFP,
DILG and NAMRIA pursuant to the annual appropriations act.
Additional Compensation (ADCOM) (805). This account is used to record the payment
of allowance authorized under Administrative Order No. 53 dated May 17, 1993 granted
to all government personnel whether regular or casual; and those on temporary status or
contractual personnel whose employment is in the nature of a regular employee.
Representation Allowance (RA) (806). This account is used to record representation

allowance granted to authorized officials and employees while in the actual performance
of their respective functions.
Transportation Allowance (TA) (807). This account is used to record allowance granted
to authorized officials and employees for transportation expenses, which shall be paid
from appropriations provided for their respective offices.
Clothing Allowance (808). This account is used to record allowance granted to

government officials and employees for office uniforms at such amount as may be
authorized by applicable General Appropriations Act, which may be given in kind or in
cash.
Honoraria (809). This account is used to record payment for services rendered by
government personnel performing activities or discharging duties in addition to, or over
and above their regular functions, and payment for services of personnel with expertise or
professional standing in recognition of his broad and superior knowledge in specific fields.
Hazard Pay (810). This account is use to record compensation paid to employees who
are working or assign in difficult, dangerous, strife-torn and embattled areas certified by
the Department of National Defense, And whose lives are directly expose to work
conditions which may cause injury, sickness or death or harmful change in the human
organism, such as; exposure to harmful chemicals, wastes and pollutants, micro-
organisms and other harmful elements, or situations that endanger life or health as
certified by authorized government agency.
Overtime and Night Pay (811). This account is use to record payment for working in
excess of the minimum total hours set for a given period to regular/casual/contractual
employees of the agency.
Holiday Pay (812). This account is use to record compensation paid to government
employees who rendered authorized services on holidays.
Christmas Bonus (813). This account is use to record Christmas bonus given to
government officers and employees as authorized by law.
Cash Gift (814). This account is use to record cash gift granted to government officials
and employees as authorized by law.
Productivity Incentive Benefits (815). This account is use to record incentive benefits
for the recognition of government officers and employees' productivity and performance
as authorized by law.
Other Bonuses and Allowances (816). This account is use to record the payment of
other bonuses and allowances not classified under the specific accounts as authorized by
law, such as subsistence, laundry, living quarters, allowance, etc.
Life and Retirement Insurance Contributions (817). This account is use to record the
government’s share in premium contributions to life insurance and retirement funds of the
GSIS.
PAG-IBIG Contributions (818). This account is use to record the government's share of
premium contributions to the Home Development Mutual Fund (HDMF).
PHILHEALTH Contributions (819). This account is use to record the government’s share
in premium contributions to health insurance funds maintained with the Philippine Health
Insurance Corporation (PHIC).
ECC Contributions (820). This account is use to record the government's share in
premium contributions to the Employees' Compensation Commission (ECC).
Pension and Retirement Benefits (821). This account is use to record pensions and
retirement benefits of government officers and employees and/or their dependents for past
services rendered.
Terminal Leave Benefits (822). This account is use to record payment for the money
value of the total accumulated leave credits of government officials employees upon
retirement or voluntary separation.
Health Workers’ Benefits (823). This account is use to record benefits given to health
workers.
Subsistence and Quarters’ Allowances (824). This account is use to record

subsistence and quarters’ allowances given to authorized government officials and
employees.
Longevity Pay (825). This account is use to record longevity pay given to government
officers and employees as authorized by law.
Other Personnel Benefits (830). This account is use to record benefits not classified
under any of the specific personnel benefits accounts, such as monetization of leave
credits, loyalty cash award, medical insurance premium, medical/hospital expense,
executive check up, etc.
Traveling Expenses – Local (831). This account is use to record expenses incurred in
the movement of persons within the Philippines whether employed in the government or
not. Such as: transportation, travel per diems; hire of guides or patrol; ferriage;
transportation of personal baggage or household effects; bus, rail road, airline, and
steamship fares; tips, airport fees, porter fees, transfers, etc., of persons while on official
travel; charter of boats, launches, cars, road tolls, parking fees and all other similar
expenses.
Traveling Expenses – Foreign (832). This account is use to record expenses incurred
in the movement of persons outside the Philippines whether employed in the government
or not. Such as; transportation of personal baggage or household effects; bus, rail road,
airline, and steamship fares; tips, airport fees, porter fees, transfers, passport fees, etc.,
of persons while on official travel; charter of boats, launches, cars, road tolls, parking
fees and all other similar expenses.
Training and Seminar Expenses (833). This account is use to record expenses incurred
for participation/attendance of personnel to training, conventions and seminar/workshops.
It also includes expenses incurred related to training such as payment of honoraria to
lecturers, hand outs given, supplies and materials used, meals and snacks.
Water (834). This account is use to record costs of water consumed in government
facilities in connection with government operations and projects.
Electricity (835). This account is use to record costs of electric power or illumination
consumed in government facilities such as: office buildings, shops and grounds, streets,
plaza, parks and monuments, etc. in connection with government operations and projects.
Cooking Gas (836). This account is use to record the cost of cooking gas consumed in
connection with government operations and projects.
Telephone/Telegraph and Internet (837). This account is use to record the costs of
transmission of messages, such as: telephone, facsimile machines, telegraph, wireless
and cable charges and tolls, telegraph messenger services, and internet services.
Postage and Deliveries (838). This account is use to record the costs of postage, rent
of post office boxes, and cost of deliveries of letters and other messages and documents,
cost of transporting official forms, documents/records and good, etc.
Subscription Expenses (839). This account is use to record the costs of subscription to
library materials, such as: magazines, periodicals, and other reading materials.
Advertising Expenses (840). This account is use to record the cost of authorized
advertising and publication of notices in newspapers and magazines of general circulation,
television, radio and other forms of media.
Rent Expenses (841). This account is use to record rental fees for the use of facilities or
equipment; and costs for the use of offices and grounds, quarters of personnel, arsenal,
barracks, warehouses, office machines, and other equipment.
Insurance Expenses (842). This account is use to record premiums for the insurance of
government properties such as buildings, equipment, motor vehicles, etc.
Fidelity Bond Premiums (843). This account is use to record expenses for premium on
fidelity bond of accountable officers.
Survey Expenses (844). This account is use to record expenses incurred in the conduct
of survey of government land.
Storage Expenses (845). This account is use to record expenses incurred for the
storage/safekeeping of government goods and properties.
Zoological/Animal Maintenance Expenses (846). This account is use to record

expenses for foods/medicines/veterinary expenses and other maintenance needs of
animals in government zoos, wildlife, sanctuary, etc.
Printing and Binding Expenses (847). This account is use to record the cost of
producing, printing, and binding materials such as: books, reports, catalogues, documents
and other reading materials.
Accountable Forms Expenses (848).This account is use to record the cost of

accountable forms used in the course of government operations.
Office Supplies Expenses (849). This account is use to record the cost of all office
supplies, printed general forms, janitorial supplies, IT supplies, etc. used in connection
with government operations.
Medical, Dental and Laboratory Supplies Expenses (850). This account is used to
record the cost of medicines and other medical, dental and laboratory supplies used in the
course of government operations/projects.
Food and Non-food Expenses (851). This account is used to record expenses for food,
clothing and other maintenance needs of patients in hospitals/centers, sanitarium and
inmates in penitentiary/sanitarium including those distributed to people affected by
calamities/disasters/ground conflict. All purchases of perishable items shall be recorded
under this account.
Gasoline, Oil and Lubricants Expenses (852). This account is use to record the cost of
gasoline, oil and lubricants consumed by government vehicles and other equipment in
connection with government operations and projects.
Agricultural Supplies Expenses (853). This account is use to record the cost of
fertilizers, pesticides and agricultural supplies issued/used in connection with government
operations and projects.
Legal Services (854). This account is use to record the cost of legal services rendered
by private lawyers to any government agency as authorized by law.
Auditing Services (855). This account is use to record the amount due the Commission
on Audit for auditing services rendered or expenses incurred by the Auditing Unit of any
government agency such as traveling expenses, conference/seminar fees, etc.
Consultancy Services (856). This account is use to record the cost of services of
individual/private companies, or other government agencies hired to undertake a specific
work or job requiring special or technical skills not available in the concerned agency.
General Services (857). This account is use to record the expenditures for general
services such as carpentry, plumbing, electrical, etc.
Security and Janitorial Services (858). This account is use to record the cost of
security/janitorial services contracted by the agency.
Taxes, Duties and Licenses (859). This account is use to record payments and
provisions for all taxes, duties and licenses except income tax.
Tax Credit Subsidy (860). This account is use to record the amount due to taxpayers
who are entitled/qualified to avail of the tax credit or duty drawback and tax incentives
authorized under the National Internal Revenue Code, Tariff and Customs Code of the
Philippines, and Omnibus Investment Code.
Tax Exemption Expenses (861). This account is use to record in the books of the Bureau
of Internal Revenue and Bureau of Customs the amount of assessments of customs duties
and other taxes that requires no actual payment by exempted national government
agencies.
Public Infrastructure Repairs and Maintenance (862). This account is use to record
the cost of repairing and maintaining public infrastructures owned by the government. It
also includes the cost of construction materials issued for the repair of public
infrastructures.
Reforestation Project Maintenance (863). This account is use to record the cost of
maintaining reforestation projects owned by the government.
Buildings Maintenance (864). This account is use to record the cost of repairing and
maintaining buildings owned by the government. It also includes the cost of construction
materials issued for the repair of government buildings.
School Buildings Maintenance (865). This account is use to record the cost of repairing
and maintaining school buildings owned by the government. It also includes cost of
construction materials issued for the repair of school buildings.
Markets and Slaughterhouses Maintenance (866). This account is use to record the
cost of repairing and maintaining markets and slaughterhouses owned by the government.
It also includes cost of construction materials issued for the repair of market and
slaughterhouses.
Hospitals and Health Centers Maintenance (867). This account is use to record the cost
of repairing and maintaining hospitals, sanitaria and health centers owned by the
government. It also includes cost of construction materials issued for the repair of
hospitals and health centers.
Other Structures Maintenance (868). This account is use to record the cost of repairing
and maintaining structures owned by the government other than those classified under
specific maintenance accounts. It also includes cost of construction materials issued for
the repair of other structures.
Industrial Machineries Maintenance (869). This account is use to record the cost of
repairing and maintaining industrial machineries owned by the government. It also
includes cost of spare parts issued from stock for the repair of industrial machineries.
Other Machineries Maintenance (870). This account is use to record the cost of repairing
and maintaining other machineries owned by the government. It also includes cost of
spare parts issued from stock for the repair of other machineries.
Firefighting Equipment and Accessories Maintenance (871). This account is use to

record the cost of repairing and maintaining firefighting equipment and accessories owned
by the government. It also includes cost of spare parts issued from stock for the repair of
firefighting equipment and accessories.
Construction and Heavy Equipment Maintenance (872).This account is use to record the
cost of repairing and maintaining construction equipment owned by the government. It
also includes cost of spare parts issued from stock for the repair of construction
equipment.
Technical and Scientific Equipment Maintenance (874). This account is use to record
the cost of repairing and maintaining technical and scientific equipment owned by the
government. It also includes cost of spare parts issued from stock for the repair of technical
and scientific equipment.
IT Equipment Maintenance (875). This account is use to record the cost of repairing and
maintaining IT equipment owned by the government. It also includes cost of spare parts
issued from stock for the repair of IT equipment.
Telegraph, Telephone, Cable, TV and Radio Equipment Maintenance (876). This

account is use to record the cost of repairing and maintaining telegraph, telephone,
facsimile machines, cable, TV and radio equipment owned by the government. It also
includes cost of spare parts issued from stock for the repair of telegraph, telephone, cable,
TV and radio equipment.
Artesian Wells, Reservoirs, Pumping Stations and Conduits Maintenance (877).

This account is use to record the cost of repairing and maintaining artesian wells,
reservoirs, pumping stations, etc. owned by the government. It also includes cost of spare
parts issued from stock for the repair of artesian wells, reservoirs, pumping stations and
conduits.
Motor Vehicles Maintenance (878). This account is use to record the cost of repairing
and maintaining motor vehicles owned by the government. It also includes cost of spare
parts issued from stock for the repair of motor vehicles.
Watercrafts Maintenance (879). This account is use to record the cost of repairing and
maintaining watercrafts owned by the government. It also includes cost of spare parts
issued from stock for the repair of watercrafts.
Trains Maintenance (880). This account is use to record the cost of repairing and
maintaining trains owned by the government. It also includes cost of spare parts issued
from stock for the repair of trains and railroads.
Aircrafts/Aircraft Ground Equipment Maintenance (881). This account is use to record the
cost of repairing and maintaining aircrafts/aircraft ground equipment owned by the
government. It also includes cost of spare parts issued from stock for the repair of
aircrafts/aircraft ground equipment.
Office Equipment Maintenance (882). This account is use to record the cost of repairing
and maintaining office equipment owned by the government. It also includes cost of spare
parts issued from stock for the repair of office equipment.
Other Equipment Maintenance (883). This account is use to record the cost of repairing
and maintaining equipment owned by the government other than those classified under
specific equipment maintenance accounts. It also includes cost of spare parts issued from
stock for the repair of other equipment.
Furniture and Fixtures Maintenance (884). This account is use to record the cost of
repairing and maintaining furniture and fixtures owned by the government. It also includes
cost of construction materials issued from stock for the repair of furniture and fixtures.
Ordnance Maintenance (885). This account is use to record the cost of repairing and
maintaining ordnance owned by the government. It also includes cost of spare parts
issued from stock for the repair of ordnance.
Other Repairs and Maintenance (886). This account is use to record the cost of repairing
and maintaining other types of property, plant and equipment owned by the government
not classified under specific property, plant and equipment maintenance accounts. It also
includes painting supplies, plumbing and electrical supplies, spare parts/constructions
materials issued from stock for repair/maintenance of said property, plant and equipment.
Awards and Indemnities (887). This account is use to record indemnities for destruction
of property, death or injury to persons, awards by courts or by administrative bodies.
Examples are indemnities for persons injured or killed or property destroyed through
military action, indemnities for property taken by the government through civil action,
awards and compensation provided by laws.
Rewards and Other Claims (888). This account is use to record payments of rewards
for any informer or for any act done in connection with the apprehension of an offender.
This account also includes indemnities paid to persons in the government service who
become disabled on account of sickness, injuries, or death which occurred or which were
contracted or sustained in the performance of official duty.
Grants and Donations (889). This account is use to record all non-repayable transfers
given to other levels of government, international institutions or non-government
organizations. Grants encompass reparations and gifts given for particular projects or
programs, general budget support or for any other purposes.
Representation Expenses (890). This account is use to record authorized expenses

incurred for meetings, conferences and official entertainment in the government.
Extraordinary and Miscellaneous Expenses (891). This account is use to record

extraordinary expenses incurred by government officials and those of equivalent rank as
maybe authorized by the Department of Budget and Management (DBM) for public
relations, membership fees in government associations and in national professional
organizations duly accredited by the Professional Regulation Commission.
Confidential and Intelligence Expenses (892). This account is use to record the cost
of services, which are confidential in nature. This is rendered by persons who are
temporarily employed, by authorized administrative or executive officers, to carry on
successfully administrative activities; compensation of informers employed to detect the
whereabouts of criminals or the existence of prohibited games which compensation shall
not exceed ten per centum of the fines imposed upon the convicts; and other expressly
authorized confidential expenses for which appropriations have been approved
specifically for the purpose.
Anti-Insurgency/Contingency Expenses (893). This account is use to record

unforeseen expenses arising from the occurrence of insurgency/natural calamities or
financial dislocation on account thereof.
Subsidy to National Government Agencies (894). This account is use by the Bureau
of the Treasury (BTr) for the cash equivalent of the used Notice of Cash Allocation upon
replenishment to head office of Authorized Government Servicing Banks (AGSBs)
including those paid by the BTr for the account of national government agencies.
Subsidy to Local Government Units (895). This account is use to record financial
assistance granted to LGUs for the purpose of pursuing government programs or projects
of public interest.
Subsidy to Government Corporations (896). This account is use to record financial

assistance granted to GOCCs to cover operational expenses not supported by corporate
revenues or to cover corporate deficit and losses as authorized by law.
Membership Dues to International Institutions (899). This account is use to record

membership dues, contributions/or cost of approved participation in international
organizations.
Depreciation – Land Improvements (902). This account is use to record depreciation

of land improvements due to wear and tear, and deterioration.
Depreciation – Leasehold Improvements (903). This account is use to record

depreciation of leasehold improvements due to wear and tear, and deterioration.
Depreciation – Buildings (904). This account is use to record depreciation of buildings

used in government operations due to wear and tear, and deterioration.
Depreciation – School Buildings (905). This account is use to record depreciation of

school buildings used in government operations due to wear and tear and deterioration.
Depreciation – Markets and Slaughterhouses (906). This account is use to record

depreciation of markets and slaughterhouses used in government operations due to wear
and tear and deterioration.
Depreciation – Hospitals and Health Centers (907). This account is use to record
depreciation of hospitals and health centers used in government operations due to wear
and tear and deterioration.
Depreciation – Other Structures (908). This account is use to record depreciation of

other structures used in government operations due to wear and tear and deterioration.
Depreciation – Industrial Machineries (909). This account is use to record depreciation

of industrial machineries used in government operations due to wear and tear,
obsolescence and/or technological innovation.
Depreciation – Other Machineries (910). This account is use to record depreciation of

other machineries used in government operations due to wear and tear, obsolescence
and/or technological innovation.
Depreciation – Firefighting Equipment and Accessories (911). This account is use to

record depreciation of firefighting equipment and accessories used in government
operations due to wear and tear, obsolescence and/or technological innovation.
Depreciation – Construction and Heavy Equipment (912). This account is used to

record depreciation of construction and heavy equipment used in government operations
due to wear and tear, obsolescence and/or technological innovation.
Depreciation – Technical and Scientific Equipment (914). This account is used to

record depreciation of technical and scientific equipment used in government operations
due to wear and tear, obsolescence and/or technological innovation.
Depreciation – IT Equipment (915). This account is use to record depreciation of IT

equipment used in government operations due to wear and tear, obsolescence and/or
technological innovation.
Depreciation – Telegraph, Telephone, Cable, TV and Radio Equipment (916). This

account is use to record depreciation of telegraph, telephone, facsimile machines, cable,
TV and radio equipment used in government operations due to wear and tear,
obsolescence and/or technological innovation.
Depreciation – Artesian Wells, Reservoirs, Pumping Stations and Conduits (917).

This account is use to record depreciation of artesian wells, reservoirs and pumping
stations used in government operations due to wear and tear, obsolescence and/or
Depreciation – Motor Vehicles (918). This account is use to record depreciation of motor
vehicles used in government operations due to wear and tear.
Depreciation – Watercrafts (919). This account is use to record depreciation of

watercrafts used in government operations due to wear and tear and/or technological
innovation.
Depreciation – Trains (920). This account is use to record depreciation of trains used in
government operations due to wear and tear, obsolescence and/or technological
innovation.
Depreciation – Aircrafts/Aircraft Ground Equipment (921). This account is use to

record depreciation of aircrafts/aircraft ground equipment used in government operations
due to wear and tear, obsolescence and technological innovation.
Depreciation – Office Equipment (922). This account is use to record depreciation of

office equipment used in government operations due to wear and tear, obsolescence and
Depreciation – Other Equipment (923). This account is use to record depreciation of

other equipment not included under the specific classification of equipment used in
government operations due to wear and tear, obsolescence and technological innovation.
Depreciation – Furniture and Fixtures (924). This account is use to record depreciation
of furniture and fixtures used in government operations due to wear and tear, deterioration
and technological innovation.
Depreciation – Ordnance (925). This account is use to record depreciation of ordnance

used in government operations due to wear and tear, obsolescence and technological
innovation.
Depreciation – Books (926). This account is use to record depreciation of books used
in government operations due to wear and tear, and obsolescence.
Depreciation – Other Property, Plant and Equipment (927). This account is use to
record depreciation of other property, plant and equipment used in government operations
due to wear and tear, deterioration, obsolescence and technological innovation.
Obsolescence – IT Software (928). This account is use to record the reduction in the
book value of IT Software used in the operation due to change in
legislation/policies/regulations, obsolescence and technological innovation.
Bad Debts Expense (929). This account is use to record the amount of receivables
determined to be uncollectible.
Loss on Sale of Assets (947). This account is used to record the amount of loss resulting
from the sale of assets where the proceeds is lower than the net book value (book value
less accumulated depreciation).
Loss of Assets (948). This account is used to record the costs of losses of government
funds and property due to theft, fortuitous events/calamities/civil unrest and war based on
approved request for relief from accountabilities.
Other Expenses (950). This account is use to record all other expenses not
otherwise classified under any of the specific expense accounts. This includes
workbooks distributed to public schools, income tax forms, election forms, cultural/athletic
expenses, pre-employment medical check-up, trainers allowances, etc.
Financial Expenses
Bank Charges (951). This account is use to record the amount levied by a bank for
various services, such as charges for inter-branch transactions, cost of check booklets,
cost of stoppage of payment, etc. Bank charges due to the negligence of accountable
officer/accounting personnel shall be their personal liability.
Interest Expenses (952). This account is use to record charges imposed as a

consequence of the use of money belonging to others, such as interest on bonds, loans,
treasury bills, treasury notes, certificate of indebtedness, and other interest bearing
financial obligations.
Commitment Charges (953). This account is use to record a levy or charge imposed by
creditors on the undrawn amount of the loan with foreign or domestic lending institutions.
Documentary Stamps Expenses (954). This account is use to record documentary

stamps expense for treasury bills issued by the National Government and other
transactions of national government agencies.
Other Financial Charges (955). This account is use to record other charges imposed by
creditors such as: front-end fees, management fees, and other charges not classified
under the specific accounts on financial expenses.
Foreign Exchange (FOREX) Loss (956). This account is use to record losses incurred
in the conversion of foreign currencies to the Philippine peso, involving any of the following
transactions:
a. Conversion of foreign currency deposits - It is the resulting difference

when the prevailing exchange rate is lower than the exchange at the time
of transactions or last adjustment.
b. Remittances or repayments of foreign loans by the National Government

- It is the resulting difference when the prevailing exchange rate is higher
than the rate of exchange at the time of receipt of loan proceeds or last
adjustment.
Debt Service Subsidy to GOCCs (957). This account is use to record subsidies granted
to GOCCs for the servicing of their foreign loans relent by the Republic of the Philippines
as authorized by law or corporate body.
Loss on Guaranty (958). This account is use to record losses incurred by the National
Government for guaranteed loans of GOCCs as authorized by law or corporate body.0
Referrences:
- New Government Accounting Manual

- New Government Accounting Systems(NGAS)
- COA Circulars

NGAS 2019 eBOOK

Caricato da

Informazioni sul documento

Copyright

Formati disponibili

Condividi questo documento

Condividi o incorpora il documento

Opzioni di condivisione

Hai trovato utile questo documento?

Questo contenuto è inappropriato?

Copyright:

Formati disponibili

NGAS 2019 eBOOK

Caricato da

Copyright:

Formati disponibili

Copyrights Reserved: Braulio Adolfo Cloribel, Jr.

CPA, MBA, MPA

THE ROLE OF NATIONAL

2019 Edition All Rights Reserved:

BRAULIO ADOLFO CLORIBEL, JR.

Chapter 1 - The Role of NGAS in Governance 3

Chapter 2. ACCOUNTING POLICIES 5

Chapter 3. Basic Features and Policies 6

Chapter 4. Accounting Systems 9

Chapter 5. Trial Balances & Financial Statements 38

Chapter 6. Responsibility Accounting 49

Chapter 7. Illustrative Accounting Entries 51

Chapter 8. The Accounting Forms and Reports 56

Chapter 9. THE CHART OF ACCOUNTS 58

Chapter 10. DESCRIPTION OF ACCOUNTS 71

Chapter 1 - The Role of NGAS in Governance

 NGAS is the language of governance required by stakeholders.

NGAS is often called “the language of governance.” Why? Because it

In fact, the purpose of NGAS is to help stakeholders make better governance

Government Stakeholders: Internal and External

 Internal stakeholders are entities within a government (e.g., employees, officers,

Chapter 2. ACCOUNTING POLICIES

a. Uniform guidelines and procedures in accounting for government funds and

Coverage. NGAS shall be used by all government agencies.

“The Commission on Audit shall have exclusive authority, subject to the

Chapter 3. Basic Features and Policies

a. Accrual Accounting. Modified accrual basis of accounting shall be used.

Debit Prepaid Rent (161) for:

Credit Prepaid Rent (161) for:

Debit Deferred Credits to Income (440) for:

Credit Deferred Credits to Income (440) for:

Services not yet rendered

Regular Agency (RA) Books. These shall be used to record the

 Cash Receipts Journal (CRJ)

 General Ledger (GL)

 Subsidiary Ledgers (SL) for:

National Government (NG) Books. These shall be used to record

 Cash Journal (CJ)

With the implementation of the computerized agency accounting

f. Financial Statements. The following statements shall be prepared:

Notes to Financial Statements shall accompany the above statements.

h. Allotment and Obligation. Obligation accounting is modified to simplify

 Registry of Allotments and Obligations - Capital Outlay (RAOCO)

j. Financial Expenses. Financial expenses such as bank charges, interest

k. Perpetual Inventory of Supplies and Materials. Supplies and materials

l. Valuation of Inventory. Cost of ending inventory of supplies and materials

m. Maintenance of Supplies and Property, Plant and Equipment Ledger

n. Construction of Assets. For assets under construction, the Construction

 Registry of Public Infrastructures - Bridges (RPIB)

A Summary of Public Infrastructures/Reforestation Projects shall be prepared

p. Depreciation. The straight-line method of depreciation shall be used.

q. Reclassification of Assets. Serviceable assets no longer being used shall be

r. Allowance for Doubtful Accounts. An Allowance for Doubtful Accounts shall

s. Elimination of Contingent Accounts. Contingent accounts shall no longer be

t. Recognition of Liability. Liability shall be recognized at the time goods and

u. Interest Accrual. Whenever practical and appropriate, interest income and/or

w. Elimination of corollary and negative journal entries. The use of corollary

y. Foreign Currency Adjustment. Cash deposits in foreign currency and

Chapter 4. Accounting Systems

The following accounting systems are:

Budgetary Accounts System. Budgetary Accounts System encompasses the

Budgetary Accounts. Budgetary accounts consist of the appropriations, allotments and

Procedures in Preparation of the ABM

2 Initials under 'Prepared by' portion of the ABM.