CHAPTER II

The Revised Chart of Accounts - The standard government chart of accounts is a list of
ledger accounts consisting of real and
nominal accounts.

General Income Accounts – consists of all types of revenue / income generated by

government agencies

Specific Income Accounts – encompasses all taxes imposed on taxable income, properties

Personal Services (PS) – one of the current operating expenses

Maintenance and Other Operating Expenses (MOOE) – other current operating expenses
which include traveling expenses, training and seminar expenses, water.

Financial Expenses – includes bank charges, interest expense, commitment fees and other
financial charges.

Coding - is the systematic assignment of numbers to distinguish items within a given

classification from each other.

Codes - are assigned to account groups to facilitate location of accounts in the general and
subsidiary ledgers.

For agencies which are authorized to use income collected for their operations, the collection
shall be recorded as income in the Regular Agency Books.

Under the New Government Accounting System, the two-money column or the trial
balance of balances is required.

As in commercial accounting, there are two principal types of adjustments: accrued

items and deferred items.

Allotment – is an authorization issued by the DBM to NGAs to incur obligations for

specified amounts contained in a legislative appropriation in the form of budget
release documents. It is also referred to as Obligational Authority.

Appropriation – is the authorization made by a legislative body to allocate funds for

purposes specified by the legislative or similar authority.

Approved Budget – is the expenditure authority derived from appropriation laws,

government ordinances, and other decisions related to the anticipated revenue or
receipts for the budgetary period.

New General Appropriations – are annual authorizations for incurring obligations

during a specified budget year, as listed in the GAA.

Obligation – is an act of a duly authorized official which binds the government to the
immediate or eventual payment of a sum of money. Obligation maybe referred to as
a commitment that encompasses possible future liabilities based on current
contractual agreement.
Original Budget – is the initial approved budget for the budget period usually the
General Appropriations Act (GAA). The original budget may include residual
appropriated amounts automatically carried over from prior years by law such as
prior year commitments or possible future liabilities based on a current contractual
agreement.

Revenues – are increases in economic benefits or service potential during the

accounting period in the form of inflows or increases of assets or decreases of
liabilities that result in increases in net assets/equity, other than those relating to
contributions from owners.

Supplemental Appropriations – are additional appropriations authorized by law to

augment the original appropriations which proved to be insufficient for their intended
purpose due to economic, political or social conditions supported by a Certification of
Availability of Funds (CAF) from the BTr.

Fund Release Documents. With the adoption of the UACS and the Performance-Informed
Budgeting (PIB), the following are the fund release documents:

a. Obligational Authority or Allotment – the following are the documents which

authorize the entity to incur obligations:
1. General Appropriations Act Release Document (GAARD) – serves as the
obligational authority for the comprehensive release of budgetary items
appropriated in the GAA, categorized as For Comprehensive Release (FCR).
2. Special Allotment Release Order (SARO) – covers budgetary items under For
Later Release (FLR) (negative list) in the entity submitted Budget Execution
Documents (BEDs), subject to compliance of required documents/clearances.
Releases of allotments for Special Purpose Funds (SPFs) (e.g., Calamity Fund,
Contingent Fund, E-Government Fund, Feasibility Studies Fund) are also covered by SAROs.
3. General Allotment Release Order (GARO) – is a comprehensive authority
issued to all national government agencies, in general, to incur obligations not exceeding an
authorized amount during a specified period for the purpose indicated therein. It covers
automatically appropriated expenditures common to most, if not all, agencies without need of
special clearance or approval from competent authority, e.I. Life Insurance Premium
b. Disbursement Authority – the following documents authorize the entity to pay
obligations and payables:
1. Notice of Cash Allocation (NCA) – authority issued by the DBM to central,
regional and provincial offices and operating units to cover the cash requirements
of the agencies;
2. Non-Cash Availment Authority (NCAA) – authority issued by the DBM to
agencies to cover the liquidation of their actual obligations incurred against available
allotments for availment of proceeds from loans/grants through supplier’s credit/constructive
cash;
3. Cash Disbursement Ceiling (CDC) – authority issued by DBM to the Department
of Foreign Affairs (DFA) and Department of Labor and Employment (DOLE) to utilize their
income collected/retained by their Foreign Service Posts (FSPs) to cover their operating
requirements, but not to exceed the released allotment to the said post; and
4. Notice of Transfer of Allocation – authority issued by the Central Office to its
regional and operating units to cover the latter’s cash requirements.

Classification of Expenditures. Expenditures of NGAs shall be classified into categories as

may be determined by the DBM
Monitoring of the Budget. The budget shall be monitored by the Budget Division/Units of
NGAs through the maintenance of registries for that purpose.

Registries of Revenue and Other Receipts. The Registries of Revenue and Other Receipts
shall be maintained by the Budget Division/Unit of NGAs to monitor the revenue and other
receipts estimated/budgeted, collected and remitted/deposited.