Let's Analyze

1. What happens when there is a notice of cash allocation?

When the DBM issues a notice of cash allocation to a central, regional, or provincial office or
operational unit, the latter is granted a certain maximum amount of cash to meet their financial need.

2. Explain the different modes of disbursements.

 Disbursements through Check

Disbursements are made through checks whenever it is not convenient to be done

through cash or ADA.

The two type of checks issued by GAs are:

1. Modified Disbursement System Checks

2. Commercial Checks

 Disbursements through Cash

Disbursements through Cash constitute payments through cash advances, including

payments out of petty cash fund.

 Disbursements through Cashless Payments:

 Disbursements through Advice to Debit Account (ADA)

ADA is an accountable form used as an authorization issued by a government

agency to the MDS-GSB instructing bank to debit the specified amount from its available
NCA to pay creditors/payees listed in the LDDAP-ADA.

 Disbursements through Electronic Modified Disbursement System (eMDS)

Electronic Modified Disbursement System (eMDS) is similar to an ADA, except

that disbursements are paid directly from the BTr's accounts with the Land Bank of the
Philippines. Agencies that use LBP's eMDS can conduct online payouts for certain
transactions.

 Disbursements through Cashless Purchase Card (CPC) System

Disbursements through Cashless Purchase Card are made via an electronic card,
often known as a Credit Card.

 Disbursements through Non-Cash Availment Authority (NCAA)

Non-Cash Availment Authority (NCAA) is the authority granted by the DBM to

agencies to cover the liquidation of their actual obligations incurred against available
allotments for availments of loan/grant proceeds via supplier's credit/constructive cash.

 Disbursements through Tax Remittance Advice (TRA)

 Tax Remittance Advice (TRA) is used for the constructive remittance of taxes or
customs duties withheld to the BIR or BOC, respectively.

3. In your own words, what is Disbursement for Inter-Agency Transferred Funds (IATF)?

Inter-Agency Transferred Funds is the cash or money transferred from one agency to
another in which the fund is originally allotted for the transferee agency (Implementing Agency).
This typically occurs on projects. Say for example, the SSG (Source Agency) is granted by the school a
budget of 10,000 in which the 2,000 is originally allotted for the Glee Club’s (Implementing Agency)
opening presentation for a school event. The 2,000 fund here, is the Inter-Agency Transferred
Funds.

In a Nutshell

Activity 1: Based from the definition of the most essential terms in the study of government accounting
and the learning exercises that you have done, summarize your understanding in disbursement process
of government accounting.

Disbursement Process

 Disbursement authorities:
 Notice of Cash Allocation (NCA)
 Notice of Transfer of Allocation (NTA)
 Tax Remittance Advice (TRA)
 Non-Cash Availment Authority (NCAA)
 Cash disbursement Ceiling

 All disbursements require the following certifications:

 Availability of Allotment – Budget Officer
 Availability of funds and completeness of supporting documents – Chief Accountant
 Necessity and legality of disbursements- Head of the Requesting Unit.

 All disbursement shall be made through Disbursement Vouchers (DVs) or Payroll which are
approved by the Head of Agency.

 Modes of Disbursement
 Check
 Cash
 Cashless Payments:
 Advice to Debit Account (ADA)
 Electronic Modified Disbursement System (eMDS)
 Cashless Purchase Card System (Credit Card)
 Non-Cash Availment Authority (NCAA)
 Tax Remittance Advice