Leila G.

Ouano BSMA – 3 ACCTG 302 M 6:00 PM - 8:00 PM & F 6:00 PM – 7:00PM

ACTIVITY 03 (A03)

Story: The Budget Cycle

I. Budget Preparation
My mama and papa are going to visit my great grandparents for 3 days, so they asked me to
make an estimate of the money we need while they’re out. (Budget Call) I started to make
my estimate by asking first my little brother’s needs (‘bottom up’ budgeting). A week ago, I
use to have an old estimate however instead of giving mama such, I’ve decided to make a
new one to better reflect current circumstances. (‘zero-based’ budgeting).
I defended my estimate with Mama (Budget hearings)
Mama submitted the estimate to Papa for approval
(Presentation to the office of the President)

II. Budget Legislation

Papa consulted Lola to review my estimate (House Deliberations).
After reviewing the estimate, Lola gave the estimate to Lolo for further study
(Senate Deliberations).
Lolo and Lola had some disagreements, so they asked My Uncle to harmonize the
conflicts (Bicameral Deliberations). After harmonizing the conflicts, my Uncle submitted the
“Bicam” version of the estimate back to both Lolo and Lola for ratification.
Lolo and Lola submitted the ratified estimate to Papa for enactment (President’s
enactment). My approved budget for the grocery is Php 499. (Appropriation)

III. Budget Execution

Papa left the money to my Aunt. She gave me guidelines as to how the money will be release,
based on my estimates of the timing of disbursements (Release guidelines and BEDS)
My Aunt told me that I can now incur obligation up to a maximum of Php 450 (Allotment)
I then went to the nearest market to purchase groceries, good for 3 days, worth Php 300, on
credit (Incurrence of Obligations).
My Aunt gave me Php 99 cash to cover my cash disbursement needs for the first day
(Disbursement Authority – Notice of Cash Allocation) I gave my Little Brother his share of Php
9 (Notice of Transfer of Allocation)
My Disbursement in the first day were as follows:
- Mine: Php 85 installment payment to the market
- Little Brother: Php 9 on personal needs
Total Disbursement in the first day Php 94
IV. Budget Accountability
My budget accountability report after the first day will show the following information
(Budget Accountability Reports):
- Appropriation: Php 499
- Allotment received: Php 450
- Unreleased appropriation: (Php 499 – Php 450) = Php 49
- Obligations incurred: (Php 300 to the Market + Php 9 on Little Brother’s personal
needs) = Php 309
- Unobligated allotment: (Php 450 allotment – Php 309) = Php 141
- Disbursements: Php 94
- Unpaid Obligations (Php 309 obligation incurred – Php 94 disbursement) = Php 215
(payable)
- Unused NCA = (Php 99 NCA – Php 94 disbursements) = Php 5

My Aunt periodically updates my Mama and Papa regarding my budget execution

through call and text. (Performance Review)
My Papa and Mama will audit it when they return (Audit).
-end-