Father Saturnino Urios University

ACCOUNTANCY PROGRAM

Butuan City

The Importance of Source Documents,

Payrolls and Vouchers

A Technical Paper

In Accounting 414B Internship

A Paper Presented to

The Faculty of the Accountancy Program

Father Saturnino Urios University

Butuan City

In Partial Fulfillment of the Requirements for the

Degree in Bachelor of Science in Accounting Technology

By

Berido, Sheena

Omoy, Jewvanie

Salinas, Daniel P.

Tampoy, Marcelino Jr. G.

May 8, 2018
EXECUTIVE SUMMARY

A PAPER REQUIREMENT IN

Accounting 414B Internship

The focus of this paper is to find out the problems that

were being experienced by the trainees during their internship

in Department of Education - Caraga Regional Office. This paper

will discuss the solutions that are necessary to solve the

problems cited by the trainee.

The research will only cover about the lacking document of

the payroll system of the contractual parties in the Department

of Education - Caraga Regional Office. The formulated solutions

will reflect only on the scope of the study. The research will

only be conducted on the student trainees assigned sections,

particularly the Finance Division and the Regional Payroll

Service Unit (RPSU) and should not be generalized to other

facilities or types of businesses without further study or

research.
CHAPTER 1

THE PROBLEM AND REVIEW ON LITERATURE

Introduction

Internship has become an essential component of the

undergraduate program. It provides students with a smooth

transition from the on-campus environment to the working

environment. It is often viewed as a ‘win-win’ situation for

both the intern and the intern’s employers. Students are able to

learn about the profession and gain practical experience while

simultaneously being able to reflect on what they have learned

in the classroom. Employers benefit from internships as interns

are sources of future employees. This paper examines whether the

expected benefits of internship, as perceived by interns before

going for their internship, are actually achieved (Muhamad, et.

al., 2009).

During an accounting internship, an intern has an

opportunity to get familiar with the work environment and the

culture of businesses. For this reason, accounting interns

develop an understanding of working in a professional atmosphere

as well as developing working relationships with other

accounting professionals. Also, internship opportunities may

lead to full-time employment in many organizations. On the other

hand, students pursing degrees in accounting can use practical

skills obtained during internships and apply these skills to

their academic studies in school. In addition to obtaining

experience, many colleges and universities give academic credit

for students who complete internships. (http://www.accounting-

degree.org)

Department of Education - Caraga Regional Office is under

the leadership of the Officer-In-Charge, Regional Director, Dr.

Beatriz G. Torno, CESO IV and the School Division Super-

intendents of the twelve (12) school divisions that comprise the

region, namely: Agusan del Norte, Agusan del Sur, Bayugan City,

Bislig City, Butuan City, Cabadbaran City, Dinagat Islands,

Siargao, Surigao City, Surigao del Norte, Surigao del Sur and

Tandag City.

The trainees who were having their internship in Department

of Education - Caraga Regional Office has observed actual

accounting performed by the employees and experienced it

themselves in the workplace. They were assigned in the Finance

Division and Regional Payroll Service Unit (RPSU).

There are 2 sections in Finance Division, which are Budget

Section and Accounting Section. The Budget Section will obligate

all the received documents named Obligation Request and Status

(ORS) in order to be classified and evaluated the availability

of funds based on a particular transaction, before the money

will be released, they also input all the Budget Proposals of

the Region which is being passed to them by its respective

divisions and records and distribute all Sub-Allotment Release

Order (SARO) to Operating Units (OU's); and the Accounting

Section is the department where the received vouchers are being

checked if there are lacking attachments being submitted.

Failure to complete the attachments required resulted for the

Accounting Unit to return the voucher to them to complete those

lacking requirements. The approved budget proposals will then be

pre-audited by the Accounting Unit.

On the other hand, the Regional Payroll Service Unit (RPSU)

is the department that receives documents from 12 school

division offices and personally submitted by teaching and non-

teaching personnels. It's process are deletion, inclusion, new

deduction, promotion, step-increment, s tation transfer, changed

name and status, taxcode or charge tax, form 7 (absences or

summary of absences), and preparation of PLI's billing which all

takes place at the first half of the month. And also review the

load billing and posting final billing for every month in

preparation of salary and submit disbursement to the accounting

office. They also print the pay file (proof list) and submit to

DBP, printing of payrolls, remittances, other remittances

(Philhealth, GSIS, Private Lending Institutions (PLI's), and

Pag-ibig), payslip and form 7. After which, segregates those

remittance to remittance voucher and submit it to the accounting

unit.

The Department of Education’s function is to support each

and every student’s education and also, monitor the level of

education in each primary school. In order to bring out the best

of the educators and its students, Department of Education is

engaged in releasing the budget money for the use of their

activities. Although Department of Education Regional Office are

veteran in managing their transactions, still problems occur and

inevitable when engaging in their operation.

There are some instances where disbursement report from

RPSU are lacking some documents, it was re-checked and proved by

the accounting office then the report will be returned to the

RPSU for the completion of requirements.

Objectives of the Study

In particular, this paper gives factual flow of the reports of

the disbursement vouchers of finance division with regional

payroll service unit in Department of Education CARAGA

regional office and aims to help by giving a recommendation to

the said establishment.

1. Describe the flow of disbursement voucher reports;

2. Identify and evaluate the encountered problem in the

workplace;

3. Recommend solutions regarding the existing problem.

Theoretical Framework

According to Kessler, et. al., (2009) internships provide a

unique opportunity to students in various fields of study;

students are provided a practical learning experience in their

chosen future profession which the traditional classroom does

not provide. Cord, et.al., (2010) also explains that "The

opportunity to gain professional industry experience for

accounting students while undertaking their undergraduate degree

provides them with both a competitive edge in the marketplace

and an opportunity to experience the activities undertaken in

their chosen profession. Structured experiential learning

programs provide students with the practical opportunity to

apply their knowledge in an industry context and also to reflect

on their personal learning journey".

Review on Related Literature

Regional Payroll Services Unit Vouchers (RPSU). The DepEd

CARAGA's Regional Payroll Services Unit (RPSU) is supervised by

the Regional Accountant who is directly accountable to the

Regional Finance Officer. RPSU prepares the monthly payrolls for

salaries of public elementary and secondary school teachers and

non-teaching personnel of the twelve (12) Divisions of the

National Capital Region, except for some schools which are under

direct release, they prepare their own payrolls. Moreover, the

RPSU prepares and processes the monthly remittances of

employees' deductions such as government shares to GSIS, Pag-

Ibig, PhilHealth and accredited Private Lending Institutions

(PLI’s).

According to Timothy Carse and Jeffrey Slater, a Payroll

Accounting involves the calculation of the earnings of employees

and the related withholding for taxes and other deductions,

recording the results of payroll activities, and preparing of

payroll tax returns. No matter how many workers a business

employs, the same basic steps and procedures must be followed to

calculate their earnings, tax withholding and net pay.

Individuals who work in the area of payroll accounting are

called payroll professionals. The payroll professionals must be

knowledgeable in the areas of double-entry accounting and

generally accepted accounting principles (GAAP), employment law,

and some parts of federal tax law (the Internal Revenue Code) as
well as certain state and/or local laws affecting the workplace.

The activity of paying workers is known as the “ cycle of paying

employees “. There are five steps involved in this cycle namely

Tracking of working hours, calculating gross pay, computing tax

witholding and other deductions to arrive at net pay, preparing

and distributing paychecks, and recording and posting payroll

journal entries. Two unique accounting documents that

specifically deal with the payroll function are the payroll

register and the employee earnings record. The payroll register

is the accounting document that provides a summary of the

payroll information for a pay period. The employee earnings

record provides a history of the amounts each individual

employee earns during a calendar year. These two accounting

documents are needed to properly record and track employee

earnings by pay period, calendar quarter, and calendar year.

A payroll accounting system embodies all those procedures

and methods related to the disbursement of pay to employees. The

nature of the payroll records depends to a great extent on the

size of the workforce and the degree to which the recordkeeping

is automated. In most payroll systems-manual or automated-the

payroll register and the employee's earnings record are the two

basic records that are utilized (Bieg and Toland, 2013).

According to The Institute of Certified Bookkeepers (ICB),

bookkeeping is a growing profession - it is demanding, exciting,

challenging and above all, rewarding. It is about understanding

how a business works and then providing accurate figures that

enable the business to know exactly how well it is doing. For

men and women of all ages and from all backgrounds it provides
outstanding career opportunities. The basic system of double

entry bookkeeping was invented more than five hundred years ago

by a Cistercian monk called Luca Pacioli. His system still

endures today and is used throughout the world, making

bookkeeping a truly international profession. Bookkeeping today

is far more than entering data and reconciling the bank.

Bookkeeping is thinking about the needs of the business,

thinking about the processes to get a result.

Firstly, what is expected for standard bookkeeping?

1. Processing purchases, sales, receipts, payments

2. Processing payroll and maintaining entitlements and

employee records

3. Bank reconciliation

4. Providing reporting for preparation of a business activity

statement (BAS)

5. Producing reports for both management and accountant

6. Record keeping

Bookkeepers are responsible for:

 Tracking down all the ways the business spends money

 Cash payments – trying to get the documents, working out

what it is for, recording it

 Is there an ordering system? Does there need to be one? How

to record and reconcile the systems

 Supplier invoices to be received, checked for validity,

scheduled/noted for payment

  Paying suppliers and recording the payment

 Paying employees and recording the payment and the payroll

obligations

 Paying employees and recording the payment and the payroll

obligations

 What is the business process for spending money and how

should it be recorded?

Every business must have a bookkeeper. For small

businesses, the bookkeeper may be the proprietor, but the larger

the business is, the more a dedicated bookkeeper--or a staff of

bookkeepers--is needed. Bookkeepers track all the money that

comes into a business and all that goes out to determine whether

the business is making a profit. Bookkeepers are responsible for

a number of tasks, including handling payroll, monitoring loans,

and preparing tax returns. (https://www.wikihow.com/Be-a-

Bookkeeper)

Significance of the Study

This study has a significant importance to the following:

a. Interns. It allows them in getting new experiences in the

actual field while applying their knowledge learned from

the school. The ultimate aim of an internship is to get

experience and exposure to respective fields; and for them

to see that learning theories is really different from the

jobs in the real world.

 b. Department of Education. This study will help DepEd to be

oriented and to take action on the improvement of their

operation regarding to their purchase orders and other

transactions. They will also learn and know the opinions of

the trainees regarding to this matter.

c. Instructors. This study will give them an insight about the

happenings in the actual field of work in the Department of

Education. This will serve as an example to be used in

teaching the students to further understand the lessons

relating to this field.

d. Future Researcher. This study will give the future

researchers, mainly the business related courses an

additional knowledge and help them better understand the

reason of the specific problem stated in this study and why

they occur. The future researcher will also learn about the

possible outcome of this conflict. Moreover, this will

enable them to see the difference between the theories

learned in school and in the actual work.

Definition of Terms

Accounting internship is a temporary, entry-level accounting

position with a company or firm sponsor. The sponsor may be

after be either a Certified Public Accounting (CPA) firm, a

company in industry, or a government agency. The student intern

works as an employee and performs a specific set of duties.

Chapter 2
METHODOLOGY

This chapter contains information on the research

methodology used to complete this study. It also includes all

the information of the research environment and the ethical

consideration. Chapter 2 also addresses the instruments used in

gathering data and the data analysis of this study.

Research Environment

The researchers choose Department of Education Caraga

Regional Office as the entity to conduct their internship.

Research environment talks about the nature of the Department of

Education including their mission and vision, the divisions and

their functions in the entity, the location and the

organizational structure of the entity.

To carry out its mandates and objectives, the Department is

organized into two major structural components. The Central

Office maintains the overall administration of basic education

at the national level. The Field Offices are responsible for the

regional and local coordination and administration of the

Departments mandate.

Our Mandate

“The State shall protect and promote the right of all

citizens to quality education at all levels, and shall take

appropriate steps to make such education accessible to

all.”(Article 14, Section 1 of the Philippine Constitution)

DepEd Vision
 We dream of Filipinos who passionately love their country,

and whose values and competencies enable them to realize their

full potential and contribute meaningfully to building the

nation.

As a learner-centered public institution, the Department of

Education continuously improves itself to better serve its

stakeholders.

DepEd Mission

To protect and promote the right of every Filipino to

quality, equitable, culture-based, and complete basic education

where:

• Students learn in a child-friendly, gender-sensitive, safe,

and motivating environment.

• Teachers facilitate learning and constantly nurture every

learner.

• Administrators and staff, as stewards of the institution,

ensure an enabling and supportive environment for effective

learning to happen.

• Family, community, and other stakeholders are actively

engaged and share responsibility for developing life-long

learners.

List of Offices and Functions

Office of the Regional Director (ORD)

The ORD Composes of Three Units:

1. Legal. To ensure that the Regional Office is provided with

judicious legal and technical assistance in the performance of

its duties, responsibilities and accountabilities towards the

attainment of effective and efficient delivery of public service

and quality basic education.

2. Public Affairs

3. Information and Communication Technology (ICT). To provide

support to regional employees and Division ITOs to ensure

quality services through delivery and deployment of ICT-enabled

solutions and services.

Administrative Services Division (ASD)

To provide the regional office with efficient, economical,

and effective services relating to personnel, records, receipt

of correspondence, supplies, equipment, collection,

disbursement, security and custody of property, and reportorial

work to oversight agencies.

Curriculum and Learning Management Division (CLMD)

To ensure full implementation of the articulated basic

education curriculum (pre-school, elementary, secondary & ALS),

its localization/indigenization and increase access to quality

and varied learning resources towards improvement in the quality

of learning outcomes.

Education Support Services Division (ESSD)

To support the delivery of basic education through programs,

projects, and the provision of needed resources to the Schools

Divisions in order to create an environment conducive to

learning and ensure learner readiness to learn through:

 School Health and Nutrition

 Education Facilities

 Programs and Services (e.g. DRRM, School Sports, Guidance

and Counseling, etc.)

Field Technical Assistance Division

To coordinate and integrate the provision of technical

assistance (TA) to schools divisions with the purpose of

facilitating the delivery of quality basic education and create

an enabling environment for schools and learning centers.

Finance Division (FD)

To provide advice to the Regional Director on the financial

resource of the region and provide services in budgeting,

accounting, reporting and coordinating with government oversight

agencies. To provide advice to the Regional Director on the

financial resource of the region and provide services in

budgeting, accounting, reporting and coordinating with

government oversight agencies.

Human Resource Development Division (HRDD)

To ensure competent personnel and staff in the regional

office and schools division offices through the implementation

and management of an efficient and effective training and

development system towards improved professional competencies

and organizational performance in the delivery of basic

education.
Quality Assurance Division

To ensure compliance with standards of quality basic

education by assessing, monitoring and evaluating the region and

schools division performances to inform decision making and

guide policy directions in the region towards continuous

improvement in the delivery of basic education.

Policy, Planning, and Research Division

To facilitate the formulation and implementation of

education plans, policies, standards and guidelines in all areas

of basic education in the region through the conduct of research

studies and the development and maintenance of the Regional

Education Planning and Data Management Systems in order to

inform and guide management’s strategic and operational

decisions in the delivery of quality basic education.

Organization Map
Ethical Consideration

The researchers applied ethical considerations in gathering

data and information in completing this paper. Research ethics

has important role in the completion of the research with

appropriate research guidelines. Consent from the participants

will be taken and appropriate permission will also be ensured

for usage of the given information. Confidentiality of the

responses will be maintained strictly to ensure privacy of the

information. The disclosure of the participant’s identity will

be based on their permission where if they are not willing to

disclose identity, their identity will not be exhibited. Beyond

that fact, usage of any secondary data from any source will be

acknowledged with appropriate reference. Hence, the ethical

aspect of research will be followed very strictly in this

research.

Instrument

The researchers used qualitative research method in

gathering information in this research. Qualitative Research is

used to gain an understanding of underlying reasons, opinions,

and motivations. Qualitative data collection methods vary using

unstructured or semi-structured techniques.

The data accumulated for this research has been gathered

through the observation of the trainees on their workplace

particularly to the budget section, accounting section and the

commission on audit department.

Hence, Trainees also gathered information through asking

employees assigned departments and sections; there are various

clarifications on the things that they have observed using

interview guide questions including on what problem are usually

encountered on their workplace and the possible consequences

towards the conflict.

Data Analysis

The data collected are processed in response to the

problems that was stated in the 1st chapter of this paper. The

researchers set objectives that help them to the collection of

the information and the data analysis. Those objectives develop

knowledge of gathering data regarding the purchase order of the

Department of Education Regional Office. The findings presented

in the next chapter were based on the observation and the data

collected from the interview that was supported by various

theories.