LOCAL TREASURY OPERATIONS MANUAL

A. INTRODUCTION

This updated manual is a vital reference material and guide to all local treasurers, and should be
considered as a work in progress which shall further be updated regularly to be attuned to the latest
issuance of laws, policies, rules and regulations.

This manual has been developed through the support of the EU-PFM 2 project and the collaborative
efforts of Bureau of Local Government Finance (BLGF) central and regional offices and selected
provincial, city and municipal treasurers.

1. TITLE

This Manual shall be known as the UPDATED LOCAL TREASURY OPERATIONS MANUAL, also
herein referred to as the ULTOM. It is an issuance of the Department .of Finance (DOF) thru the
BLGF pursuant to Article 456 of the implementing rules and regulations (IRR) of the Local
Government Code of 1991 (LGC).

2. OVERVIEW

On March 26, 2008 DOF issued Department Order No.10-08 promulgating the issuance of the
LTOM to serve as a handy reference material for all provincial, city and municipal treasurers in
discharging their mandated functions. Since then, LTOM has been a constant companion of local
treasury offices in their day to day operations.

DOF has in recent years perceived the need to revise and update, improve and enhance the LTOM
to be relevant and attuned to modern trends as well as to recent laws, policies, rules and regulations
issued by oversight agencies. The revision made a complete overhaul of the LTOM in terms of
content groupings and physical printing and packaging to make it more functional to the users.

This updated manual is now prescribe for use by all provincial, city, municipal treasurers as a
reference for operation of local treasury offices.

B. RATIONALE

Recent developments for the last ten (10) years in areas of local public finance render some
provisions of the LTOM irrelevant to the operations of local treasury offices.

There are cases that local treasurers and other local treasury officials unknowingly follow
superseded provisions of the LTOM. There are also reported complaints from the users that the
present LTOM book is bulky, voluminous and difficult to carry.

To address those pressing issues, there is a need to update the LTOM in order to harmonize its
provisions to the recent laws, policies, rules and regulations, to keep abreast with the modern trends
and to be functional for local treasurers and other stakeholders.

1. Major Changes in Fiscal Organization Since the LTOM was Issued

The Local Government Code of 1991 (LGC) which is the basis for crafting the LTOM consolidated
and adopted the various provisions of different laws which sought to expand the autonomy of local
government (R.A. 2264, R.A. 2370 and R.A. 5185). Provisions of P.D. 231, as amended by P.D.
426; P.D. 464 and P.D. 477 which were issued to improve the fiscal operations and organization of
local government units were also adopted by the LGC.

Since the issuance of the LTOM in 2008 many laws were issued amending the certain provisions of
the LGC as well as other laws providing for changes in the fiscal operations of LGUs (RA. 9640, RA
9006, RA 10121).

All of these laws and other policies affecting the local fiscal organization and functions were included
in the development of the ULTOM and is summarized in Local Treasury Operations (LTO) Annex __
of this Manual.