LICEO DE CAGAYAN UNIVERSITY

Rodolfo N. Pelaez Boulevard, Kauswagan

Cagayan de Oro City, Misamis Oriental

FRANCHISING
MIDTERM ASSIGNMENT

Submitted By:

Charrysah T. Tabaosares

BSBA – FM4

Submitted To:

Mario E. Temporada

Date Submitted:

September 25, 2020

TEST II – ESSAY

1. How the government prepares the National Budget?

 Firstly, the new system introduced the performance type of budgeting which is
highlighted by the following:

 In to the line item budgeting which emphasized personal hired and

goods purchased, performance budgeting requires that the functions,
activities and programs be identified clearly in the term of service
rendered.

 The usual concept of’ balance’ in the budget process is terms of limiting
monies spent to monies received.

 The concept of’ obligations’, from the standpoint of budgetary

management, concentrates on financial commitments rather than on
expenditures or payments.

 Budget control is now regarded as means of getting things done rather

as peso limit beyond which money would not be spent.

 The budget document separates the current operating expenditures from the
capital outlays, making it easy to locate the cost of running the government
proper and the cost of all capital improvements.

 The budget includes as appendices the revenue bills proposing additional sources
of funds, and other appropriation acts to cover the budget proposals.

 For the first time in budgeting procedures, a budget officer is designated in each
department or agency.
  Safeguards against overspending of appropriated funds are provided for in
several section which call for balanced budget, an allotment system, and the
creation of budgetary reserves.

2. Why is a government budget important?

 Government budgeting is important because it enables the government to plan and

manage its financial resources to support the implementation of various programs
and projects that best promote the development of the country. Through the budget,
the government can prioritize and put into action its plants, programs and policies
within the constraints of its financial capability as dictated by economic conditions.

3. What is government budget process?

 Budgeting for the national government involves four (4) distinct processes or
phases: budget preparation, budget authorization, budget execution and
accountability. While distinctly separate, these processes overlap in the
implementation during a budget year. Budget preparation for the next budget year
proceeds while government agencies are executing the budget for the current year
and at the same time engaged in budget accountability and review of the past year's
budget.

4. How Budget is made in the Philippines?

 The preparation of the annual budget involves a series of steps that begins with the
determination of the overall economic targets, expenditure levels, revenue
projection and the financing plan by the Development Budget Coordinating
Committee (DBCC). The DBCC is an inter-agency body composed of the DBM
Secretary as Chairman and the Bangko Sentral Governor, the Secretary of the
Department of Finance, the Director General of the National Economic and
Development Authority and a representative of the Office of the President as
members. The major activities involved in the preparation of the annual national
budget include the following: a. Determination of overall economic targets,
expenditure levels and budget framework by the DBCC; b. Issuance by the DBM of
the Budget Call which defines the budget framework; sets economic and fiscal
targets; prescribe the priority thrusts and budget levels; and spells out the
guidelines and procedures, technical instructions and the timetable for budget
preparation; c. Preparation by various government agencies of their detailed budget
estimates ranking programs, projects and activities using the capital budgeting
approach and submission of the same to DBM; d. Conduct a budget hearings were
agencies are called to justify their proposed budgets before DBM technical panels; e.
Submission of the proposed expenditure program of department/agencies/special
for confirmation by department/agency heads. f. Presentation of the proposed
budget levels of department/agencies/special purpose funds to the DBCC for
approval. g. Review and approval of the proposed budget by the President and the
Cabinet; h. Submission by the President of proposed budget to Congress. To meet
the Constitutional requirement for the submission of the President's budget with 30
days from the opening of each regular session of Congress, the budget preparation
phase is guided by a budget calendar.