Professional Documents
Culture Documents
I. BUDGET PREPARATION
A. Pre-Budget Preparation
1. The issuance of a directive from the LCE to mark the beginning of the budget preparation period for the local
government is the Local Budget Call .
• Expenditure ceiling by office/sector categorized into PS, MOOE and Capital Outlays
• Allocation Scheme
• Budget calendar and budget preparation forms
• Other administrative guidelines
2. As the policy-making body of the LGU, the Local Sanggunian shall fully endorse the general/specific objectives,
fiscal policies, strategies and priorities for the budget year as envisioned in the AIP.
A. BUDGET MESSAGE
Section 314(b)1) of LGC prescribes that the budget document shall contain a Budget Message of the Local Chief
Executives setting forth the significance of the Executive Budget particularly in relation to the approved development
plan.
Under Section 318 of the Code, “the Local Chief Executive (LCE) shall submit the said Executive Budget to the
Sanggunian concerned not later than the sixteenth (16 th) of October of the Current Fiscal Year. Failure to submit
such budget on the date prescribed herein shall subject the LCE to such criminal and administrative penalties as
provided for under this Code and other applicable laws.”
The Sanggunian shall consider the executive budget as a priority measure which shall take precedence over all
other pending and proposed measures. Immediately upon receipt of the budget, the Secretary to the Sanggunian
shall refer the said budget to the Committee on Appropriations and calendar the same for deliberation by the
legislative body.
1. The aggregate amount appropriated shall not exceed the estimates of income;
2. Full provisions shall be made for all statutory and contractual obligations. Amount appropriated for debt servicing
shall not exceed twenty percent (20%) of the regular income;
3. In the case of provinces, cities and municipalities, aid to component barangays shall be provided in amounts of
not less than P1,000.00 per barangay; and
4. Five percent (5%) of the estimated revenue from regular sources shall be set aside as an annual lump-sum
appropriation for unforeseen expenditures arising the occurrence of calamities.
1. Total appropriations whether annual or supplemental, for Personal Services of LGU for one Fiscal Year shall not
exceed forty-five percent (45%) in the case of first to third class provinces, cities, and municipalities, and fifty five
percent in the case of fourth class or lower, of the total annual income from regular sources realized in the next
preceding Fiscal Year;
2. No official or employee shall be entitled to a salary rate higher than the maximum fixed for his position or other
positions of equivalent rank by applicable laws or rules and regulations issued thereunder;
3. No local funds shall be appropriated to increase or adjust salaries or wages of officials and employees of the
national government, except as may be expressly authorized by law;
4. In cases of abolition of position and the creation of new ones resulting from the abolition of existing positions in
the career service, such abolition or creation shall be made in accordance with pertinent provisions of the code and
the civil service law, rules and regulations;
5. Positions in the official plantilla for career positions which are occupied by incumbents holding permanent
appointments shall be covered by adequate appropriations;
7. The creation of new positions and salary increase or adjustments shall in no case be made retroactive; and
8. The annual appropriations for discretionary purposes of the Local Chief Executive shall not exceed two percent
(2%) of the actual receipts derived from basic real property tax in the next preceding calendar year.
ENACTING THE APPROPRIATION ORDINANCE/ EXECUTIVE BUDGET
1. When there is fund available. (Over and above the funds that was previously certified by the Local Treasurer);
2. When there is new revenue sources. (Enacted by the Sanggunian);and
3. In time of public calamity. (Budgetary realignment).
• The DBM Regional Office shall review the appropriation ordinance of provinces, highly -urbanized cities,
independent component cities, and municipalities within Metropolitan Manila area. (Sec. 326).
• The Sangguniang Panlalawigan shall review the Appropriation Ordinance of component cities and municipalities
(Sec. 327).
• The Sangguniang Panlungsod or the Sangguniang Bayan, as the case may be shall review Appropriation
Ordinance of their respective barangays (Sec. 333).
V. BUDGET ACCOUNTABILITY
• Rendition of Accounts
• Auditorial Visitation
All department and offices in the LGU are required to submit accountability reports to the Local Finance Committee thru
the Local budget officer in order to effectively monitor the efficiency of the LGU’s fund utilization as well as assess
performance in attaining prescribed goals and objectives.