GOVERNMENT ACCOUNTING PROCESS MARCH 2023

GOVERNMENT ACCOUNTING PROCESS

- comprises the activities of analyzing, recording, classifying,
summarizing and communicating transactions involving the receipt and
disposition of government funds and property, and interpreting the
results thereof.
- This process is similar to that of a business entity, except that it
incorporates budgetary controls, such as recording in the budget
registries and preparing periodic budget accountability reports.
BOOKS OF ACCOUNTS AND REGISTRIES
The books of accounts and registries of government entities consist of:
1. JOURNALS
a. General Journal c. Cash Disbursement Journal
b. Cash Receipts Journal d. Check Disbursement Journal

2. LEDGER
a. General Ledgers
b. Subsidiary Ledgers

3. REGISTRIES
a. Registries of Revenue and Other Receipts (RROR)
b. Registry of Appropriations and Allotments (RAPAL)
c. Registries of Allotments, Obligations and Disbursements (RAOD)
d. Registries of Budget, Utilization and Disbursements (RBUD)
BUDGET REGISTRIES
1. Registries of Revenue and Other Receipts (RROR) – used to monitor the
budgeted amounts, actual collections and remittances of revenue and other
receipts.
2. Registry of Appropriations and Allotments (RAPAL) – used to monitor
appropriations and allotments. This is to ensure that allotments will not exceed
appropriations.
3. Registries of Allotment, Obligations and Disbursements (RAOD) – used to
monitor the allotments received, obligations incurred against the corresponding
allotment, and the actual disbursements made. This is to ensure that obligations
incurred will not exceed allotments while actual disbursements will not exceed the
obligations incurred. A separate RAOD shall be maintained for each object of
expenditure.
4. Registries of Budget, Utilization and Disbursements (RBUD) – used to record
the approved special budget and the corresponding utilizations and
disbursements charged to retained income. Separate RBUDs are also maintained
for each type of expenditures.
OBJECT OF EXPENDITURES
The classifications of expenditures by object are as follows:
A. PERSONAL SERVICES (PS)
- Pertain to all types of employee benefits, e.g., salaries, bonuses, allowances,
cash gift, etc.
B. MAINTENANCE AND OTHER OPERATING EXPENSES (MOOE)
- Pertain to various operating expenses other than employee benefits and
financial expenses, e.g., travel, utilities, supplies, etc.
C. FINANCIAL EXPENSES (FE)
- Pertain to finance costs, e.g. interest expense, bank charges, etc.
D. CAPITAL OUTLAYS (CO)
- Pertain to capitalizable expenditures, e.g. expenditures on the construction of
public infrastructures, acquisition costs of equipment, etc.
 BASIC RECORDINGS
On January 3, 2023, Entity A (a government agency) receives its GAA amounting to P360,000.00,
consisting of the following:
Personal Services (PS) P100,000.00; Maintenance and Other Operating Expenses (MOOE)
P 60,000.00; and Capital Outlay (CO) P 200,000.00.

REGISTRY OF APPROPRIATIONS AND ALLOTMENTS

Entity Name: ENTITY A
Fund Cluster: Regular Agency Fund

APPROPRIATIONS ALLOTMENTS UNREALIZED APPROPRIATIONS

Date Ref.
PS MOOE FE CO Total PS MOOE FE CO Total PS MOOE FE CO Total
1/3/23 GAA 100,000 60,000 - 200,000 360,000

The receipts of the appropriation is posted in the Registry of Appropriations and Allotment (RAPAL)
 BASIC RECORDINGS
On January 5, 2023, Entity A receives its allotment from the DBM consisting of the following:
Personal Services (PS) P90,000.00; Maintenance and Other Operating Expenses (MOOE)
P 40,000.00; and Capital Outlay (CO) P 170,000.00.

REGISTRY OF APPROPRIATIONS AND ALLOTMENTS

Entity Name: ENTITY A
Fund Cluster: Regular Agency Fund

APPROPRIATIONS ALLOTMENTS UNREALIZED APPROPRIATIONS

Date Ref.
PS MOOE FE CO Total PS MOOE FE CO Total PS MOOE FE CO Total
1/3/23 GAA 100,000 60,000 - 200,000 360,000

1/5/23 GAARD 90,000 40,000 - 170,000 300,000 10,000 20,000 - 30,000 60,000

The receipts of the allotment is posted in the Registry of Appropriations and Allotment (RAPAL) and
Registries Allotments, Obligations and Disbursements (RAOD).
 BASIC RECORDINGS
REGISTRY OF ALLOTMENTS, OBLIGATIONS AND DISBURSEMENTS
PERSONAL SERVICES
For the Year 2023

Entity Name: ENTITY A

Fund Cluster: Regular Agency Fund

Date Ref. Allotments Obligations Unobligated Disbursements Unpaid Obligations

Allotments Due and Not yet due and
Demandable demandable
1/5/23 90,000
 BASIC RECORDINGS
REGISTRY OF ALLOTMENTS, OBLIGATIONS AND DISBURSEMENTS
MAINTENANCE AND OTHER OPERATING EXPENSES
For the Year 2023

Entity Name: ENTITY A

Fund Cluster: Regular Agency Fund

Date Ref. Allotments Obligations Unobligated Disbursements Unpaid Obligations

Allotments Due and Not yet due and
Demandable demandable
1/5/23 40,000.00
 BASIC RECORDINGS
REGISTRY OF ALLOTMENTS, OBLIGATIONS AND DISBURSEMENTS
CAPITAL OUTLAYS
For the Year 2023

Entity Name: ENTITY A

Fund Cluster: Regular Agency Fund

Date Ref. Allotments Obligations Unobligated Disbursements Unpaid Obligations

Allotments Due and Not yet due and
Demandable demandable
1/5/23 170,000
INCURRENCE OF OBLIGATION
OBLIGATION REQUEST AND STATUS (ORS)
Obligations shall be incurred through the issuance of Obligation Request and Status (ORS). The
Requesting Office shall prepare this document, supported by valid claim documents like
disbursement vouchers, payrolls, purchases/job orders, itinerary of travel, etc.
The Head of the Requesting Office shall certify the necessity and legality of the obligation and the
validity of the supporting documents. The Head of the Budget Division shall certify the availability
of the allotment.

On January 15, 2023, Entity A enters into the following contracts:

a. Personal Services – payment of salaries and wages amounting to P70,000.00
b. Maintenance and Other Operating Services – Purchase contract of office supplies worth
P25,000.00.
c. Capital Outlays – Purchase contract for office equipment worth p160,000.00
 BASIC RECORDINGS
REGISTRY OF ALLOTMENTS, OBLIGATIONS AND DISBURSEMENTS
PERSONAL SERVICES
For the Year 2023

Entity Name: ENTITY A

Fund Cluster: Regular Agency Fund

Date Ref. Allotments Obligations Unobligated Disbursements Unpaid Obligations

Allotments Due and Not yet due and
Demandable demandable
1/5/23 90,000

1/15/23 70,000 20,000 0 0 70,000

 BASIC RECORDINGS
REGISTRY OF ALLOTMENTS, OBLIGATIONS AND DISBURSEMENTS
MAINTENANCE AND OTHER OPERATING EXPENSES
For the Year 2023

Entity Name: ENTITY A

Fund Cluster: Regular Agency Fund

Date Ref. Allotments Obligations Unobligated Disbursements Unpaid Obligations

Allotments Due and Not yet due and
Demandable demandable
1/5/23 40,000.00

1/15/23 25,000 15,000 0 0 25,000

 BASIC RECORDINGS
REGISTRY OF ALLOTMENTS, OBLIGATIONS AND DISBURSEMENTS
CAPITAL OUTLAYS
For the Year 2023

Entity Name: ENTITY A

Fund Cluster: Regular Agency Fund

Date Ref. Allotments Obligations Unobligated Disbursements Unpaid Obligations

Allotments Due and Not yet due and
Demandable demandable
1/5/23 170,000

1/15/23 160,000 10,000 0 0 160,000

INCURRENCE OF OBLIGATION
NOTICE OF OBLIGATION REQUEST AND STATUS ADJUSTMENT (NORSA)
If the obligations recorded in the RAOD and ORS need to be adjusted, the subsequent adjustment
shall be made through the use of the Notice of Obligation Request and Status Adjustment
(NORSA). The adjustment shall be effected through a positive entry (addition) or negative entry
(reduction, as appropriate.

Up to this point, nothing is recorded yet in the accounting books. The recordings above are made
on the budget registries. Journal entries shall be made only after:
a. the employees have rendered services;
c. the office supplies are delivered and received; and
d. the office equipment is delivered and received.
DISBURSEMENT AUTHORITY
NOTICE OF CASH ALLOCATION (NCA)
On January 20, 2023, Entity A receives Notice of Cash Allocation (NCA) from the DBM amounting
to P200,000.00, net of tax.

The registries used to monitor the NCA are the following:

a. Registry of Allotments and Notice of Cash Allocation (RANCA) – used to
determine the amount of allotments not covered by NCA and to monitor the
available balance of NCA.
b. Registry of Allotment and Notice of Transfer of Allocation (RANTA) – used to
determine the amount of allotments not covered by Notice of Transfer of
Allocation (NTA) and to monitor the available balance of NTA.
 BASIC RECORDINGS
REGISTRY OF ALLOTMENTS AND NOTICE OF CASH ALLOCATION
For the period January ____ 2023

Entity Name: ENTITY A

Fund Cluster: Regular Agency Fund

AMOUNT
Date Ref. Allotment Notice of Cash Allocation Balance
Received Received Utilized Unutilized NCA Unfunded Allotment
1/20/2023 300,000 200,000 - 200,000 100,000

Journal Entry: Cash – Modified Disbursement System (MDS), Regular 200,000

Subsidy from National Government 200,000
To recognize receipt of NCA from DBM
JOURNALS
A. General Journal – used to record transactions not recorded in the Special Journals.
SPECIAL JOURNALS
B. Cash Receipts Journal – used to record the Report of Collection and Deposit and Cash Receipts
Register of collecting officers.
❑ Report of Collection and Deposit (RCD) – prepared by a collecting officer to report his/her
collections and deposits to an Authorized Government Depository Bank (AGDB).
❑ Cash Receipts Register (CRReg) – used by field offices without a complete set of books to
record their cash collections and deposits in the books of their mother unit.

C. Cash Disbursements Journal – used to record the cash disbursements of the Disbursing Officer.

D. Check Disbursements Journal – used to record the check disbursements of the Disbursing
Officer.
 LEDGERS
A. General Ledger – summarizes all transactions recorded in the journals. Accounts in the general
ledger are arranged according to their sequence in the Revised Chart of Accounts.
B. Subsidiary Ledgers – show details of each control account in the general ledger.

GENERAL JOURNAL
Month of January 2023

Entity Name: ENTITY A

Fund Cluster: Regular Agency Fund

Date JEV Particulars UACS Amount

No. Object Code P Debit Credit
1/20/23 1 Cash – Modified Disbursement System (MDS), Regular 10104040 200.000
Subsidy from National Government 40301010 200,000
To recognize receipt of NCA from the DBM
 The journal entry for the NCA is posted to the general ledger as follows:

GENERAL LEDGER
Entity Name: ENTITY A Fund Cluster: Regular Agency Fund
Account Title: Cash – Monitor Disbursement System (MDS), Regular UACS Object Code: 10104040
Date Particulars Ref. Amount
Debit Credit Balance
1/20/2023 Receipts of NCA from the DBM JEV No. 1 200,000 200,000

GENERAL LEDGER
Entity Name: ENTITY A Fund Cluster: Regular Agency Fund
Account Title: Subsidy from National Government UACS Object Code: 40301010
Date Particulars Ref. Amount
Debit Credit Balance
1/20/2023 Receipts of NCA from the DBM JEV No. 1 200,000 200,000
 DISBURSEMENTS
Employees have rendered services and are now entitled to compensation.
a. Set-up of payable to officers and employees upon approval of payroll.

GENERAL JOURNAL
Month of January 2023
Entity Name: ENTITY A
Fund Cluster: Regular Agency Fund
Date JEV Particulars UACS Amount
No. Object Code P Debit Credit
01/31/2023 2 Salaries and Wages, Regular 35,000
Personal Economic Relief Allowance (PERA) 5,000
Due to BIR 10,000
Due to GSIS 2,000
Due to Pag-ibig 2,000
Due to Philhealth 1,000
Due to Officers and Employees 25,000
To recognize payable to officers and employees
upon approval of payroll
 DISBURSEMENTS
Employees have rendered services and are now entitled to compensation.
b. Posting of payable to the ORS
c. Grant of Cash Advance for payroll

GENERAL JOURNAL
Month of January 2023
Entity Name: ENTITY A
Fund Cluster: Regular Agency Fund
Date JEV Particulars UACS Amount
No. Object Code P Debit Credit
Advances for Payroll 25,000
Cash – Modified Disbursement System (MDS), Regular 25,000
To recognize grant of cash advance for payroll
 DISBURSEMENTS
d. Posting of disbursement to the payment column of the ORS and disbursement column of the RAOD

REGISTRY OF ALLOTMENTS, OBLIGATIONS AND DISBURSEMENTS

PERSONAL SERVICES
For the Year 2023

Entity Name: ENTITY A

Fund Cluster: Regular Agency Fund

Date Ref. Allotments Obligations Unobligated Disbursements Unpaid Obligations

Allotments Due and Not yet due and
Demandable demandable
1/5/23 90,000

1/15/23 70,000 20,000 0 0 70,000

1/31/23 25,000 15,000 30,000

 DISBURSEMENTS
d. Liquidation of Payroll Fund

GENERAL JOURNAL
Month of January 2023
Entity Name: ENTITY A
Fund Cluster: Regular Agency Fund
Date JEV Particulars UACS Amount
No. Object Code P Debit Credit
Due to Officers and Employees 25,000
Advances for Payroll 25,000
To recognize liquidation of Payroll Fund
 REMITTANCE OF AMOUNTS WITHHELD
Entity A remits the P15,000 withheld to the other government agencies.
The remittance of tax withheld is recorded as follows:

GENERAL JOURNAL
Month of January 2023
Entity Name: ENTITY A
Fund Cluster: Regular Agency Fund
Date JEV Particulars UACS Amount
No. Object Code P Debit Credit
Cash-Tax Remittance Advice 10,000
Subsidy from National Government 10,000
To recognize the constructive receipt of NCA for TRA
Due to BIR 10,000
Cash – Tax Remittance Advice 10,000
To recognize the constructive remittance of taxes
withheld to the BIR through TRA
TAX REMITTANCE ADVICE (TRA)
The Tax Remittance Advice (TRA) is used to recognize:
A. In the books of the government agencies, the constructive remittance of taxes withheld to the
Bureau of Internal Revenue (BIR) or customs duties withheld to the Bureau of Customs (BOC), and
the constructive receipt of NCA for those taxes and customs duties.
B. In the books of the BIR and BOC, the constructive receipt of tax revenue and customs duties; and
C. In the books of the BTr, the constructive receipt of the taxes and customs duties remitted.

The TRA is another form of disbursement authority, thus it is recorded similarly to the receipt of the
regular NCA. This means that an entity has the authority to use the amount withheld in its
operations. Amounts used from the TRA will be reported in the entity’s Monthly Report of
Disbursements.
 REMITTANCE TO GSIS, PAG-IBIG & PHILHEALTH
GENERAL JOURNAL
Month of January 2023
Entity Name: ENTITY A
Fund Cluster: Regular Agency Fund
Date JEV Particulars UACS Amount
No. Object Code P Debit Credit
Due to GSIS 2,000
Due to Pag-ibig 2,000
Due to Philhealth 1,000
Cash – Modified Disbursement System (MDS), Regular 5,000
To recognize remittance to GSIS, Pag-ibig and
Philhealth

The Obligation Request and Status (ORS) and the RAOD-PS are updated for the payments
above.
 BILLING, COLLECTIONS & REMITTANCES
Entity A bills revenue of P100,000.00 for rent income.

GENERAL JOURNAL
Month of January 2023
Entity Name: ENTITY A
Fund Cluster: Regular Agency Fund
Date JEV Particulars UACS Amount
No. Object Code P Debit Credit
Accounts Receivable 100,000
Rent/Lease Income 100,000
To recognize billing of income
 BILLING, COLLECTIONS & REMITTANCES
Entity A collects P100,000 from the billed revenue and remits the collection to the BTr.

GENERAL JOURNAL
Month of January 2023
Entity Name: ENTITY A
Fund Cluster: Regular Agency Fund
Date JEV Particulars UACS Amount
No. Object Code P Debit Credit
Cash – Collecting Officers 100,000
Accounts Receivable 100,000
To recognize collection of billed income
Cash – Treasury/Agency Deposit, Regular 100,000
Cash – Collecting Officers 100,000
To recognize remittance of income to BTr

PD No. 1445 requires that all collections must be remitted to the National Treasury, unless
another law specifically allows otherwise
 BILLING, COLLECTIONS & REMITTANCES
Entity A collects P100,000 from the billed revenue and remits the collection to the BTr.

GENERAL JOURNAL
Month of January 2023
Entity Name: ENTITY A
Fund Cluster: Regular Agency Fund
Date JEV Particulars UACS Amount
No. Object Code P Debit Credit
Cash – Collecting Officers 100,000
Accounts Receivable 100,000
To recognize collection of billed income
Cash – Treasury/Agency Deposit, Regular 100,000
Cash – Collecting Officers 100,000
To recognize remittance of income to BTr

PD No. 1445 requires that all collections must be remitted to the National Treasury, unless
another law specifically allows otherwise
 REVERSION OF UNUSED NOTICE OF CASH ALLOCATION (NCA)
Government entities are required to revert any unused NCA at the end of the accounting period.

GENERAL JOURNAL
Month of January 2023
Entity Name: ENTITY A
Fund Cluster: Regular Agency Fund
Date JEV Particulars UACS Amount
No. Object Code P Debit Credit
Subsidy from National Government 170,000
Cash – Modified Disbursement System (MDS), Regular 170,000
To recognize reversion of unused NCA
SUMMARY OF BASIC RECORDINGS:
RECORDING IN:
TRANSACTIONS REGISTRIES & OTHER RECORDS JOURNAL & LEDGER
A. APPROPRIATION - RAPAL - None
B. ALLOTMENT - RAPAL and appropriate RAODs - None
C. INCURRENCE OF - ORS and appropriate RAODs - None
OBLIGATIONS
D. NCA - RANCA Cash MDS, Regular xx
Subsidy from NG xx
E. DISBURSEMENTS - Updating of ORS and Expense/Asset xx
appropriate RAODs Payable xx

Payable xx
Cash-MDS, Regular xx
SUMMARY OF BASIC RECORDINGS:
RECORDING IN:
TRANSACTIONS REGISTRIES & OTHER RECORDS JOURNAL & LEDGER
F. TAX REMITTANCE ADVICE - Updating of ORS and Cash – TRA xx
appropriate RAODs Subsidy from NG xx

Due to BIR xx
Cash – TRA xx
G. BILLINGS, COLECTIONS, & - RROR, RCD/CRReg Accounts Receivable xx
REMITTANCES Income Account xx

Cash – CO xx
Accounts Receivable xx

Cash – Treasury/Agency
Deposit, Regular xx
Cash – CO xx
H. REVERSION OF UNUSED NCA - RANCA Subsidy from NG xx
Cash – MDS, Regular xx