COURSE TITLE: Public Fiscal Administration

(PALGA 704/ PA 840/ PAOM 804)

FINAL EXAMINATION
October 2022

EXAMINEE:_________________________ RATING:_________________

Direction. PA 840 Theories’ Application. Answer each question legibly and concisely. Ensure
to be responsive to the questions. Submit hand-written answers on or before October 27, 2021.

1. a.) What is EO 138 and its objectives?

- EO 138 provides for the full devolution of certain functions of the Executive Branch to
the Local Governments Units (LGUs), as well as the creation of a Committee on
Devolution. This was issued by President Rodrigo Roa Duterte on 1 June 2021 in
consonance with the Supreme Court ruling in Mandanas.

b.) What is National Tax Allotment (NTA) and give example of its determination in
relation to the implementation of the Mandanas-Garcia Supreme Court Ruling?
- it is previously referred to as the Internal Revenue Allotment (IRA),
shall refer to the just share of LGUs from all national taxes or
revenues actually realized or collected by the national government,
including those collected by the Bureau of the Internal Revenue (BIR),
Bureau of Customs (BOC), and other agencies or instrumentalities of the
government. All terms in the Local Government Code (LGC) pertaining to
the Internal Revenue Allotment (IRA) shall hereinafter be referred to as
the LGUs' National Tax Allotment or NTA.
-A certification demonstrating the respective 40% shares of LGUs in the
collection of national taxes made in the third fiscal year prior to the
budget year is sent to the DBM by the BIR, BOC, and BTr during the
budget preparation phase. The DBM then determines and distributes each
LGU's portion based on the formula stipulated in Section 285 of RA No.
7160, employing as basis relevant proof-supporting information,
such as the authorized.

population count and a master list of the approved land area.

c.) Illustrate how should local government units (LGUs) utilize their NTAs?
- The Philippine Constitution's Section 6, Article X, which states that local government units (LGUs) shouldhave a just
share, as established by law, in the national taxes which shall be automatically remitted to them, mandates that LGUs get a
portion of national taxes. The earmarking is meant, among other things, to increase local resources to make sure that the LGU's
citizens receive the bare minimum of fundamental services. According to the Local Government Code (LGC), LGUs receive
Internal Revenue Allotment (IRA) payments from national tax revenues as well as income from the use and growth of national
wealth. Additionally, under specific laws, some LGUs receive a portion of the proceeds from other national taxes, such the
value-added tax.

2. Enumerate and discuss the following:

a.) Define and compare taxes, fees, charges, duties, aids and borrowings.
- A taxes is any charge or other obligation that a government imposes on people or
organizations and has the legal right to collect. However, generally speaking, this word
does not apply to payments charged in exchange for the provision of particular goods or
services (e.g., bridge tolls or sanitation fees). Despite the fact that the majority of
contemporary taxes are assessed based on economic indicators like income, consumption,
property, and wealth, some governments additionally levy excise taxes on the use or sale
of certain commodities (e.g., gasoline or cigarettes). While fees is a payment made in
exchange for specific labor, services, or actions, usually ones that are carried out as part
of one's job duties or line of work. a real estate stake; an inherited estate. In this context, a
fee is the abbreviation for the term fee simple. An estate is an interest in land. The largest
estate that a person can own in a piece of land is a fee simple since it gives the owner
complete ownership of the land and all structures that are attached to it. It is full
ownership without any constraints, limits, or requirements on sale or transfer to another
parties. On the other hand, A charges is an amount paid for other items. For example, if you rent a car, you
could have to pay a fueling fee for the act of taking the car to the station and fueling it, and a fuel charge for the actual fuel
used.The term "duties" refers to a form of taxation levied on certain goods, services, or other transactions. People and
corporations may be required to pay levies on imports and exports by governments in the form of customs duties and
other taxes. Aid is money, equipment, or services that are provided for people, countries, or organizations who need them but cannot
provide them for themselves. And lastly, borrowings define
to receive money from another party with the agreement that the money will be repaid. Most borrowers borrow at interest, meaning they pay a certain
percentage of the principal amount to the lender as compensation for borrowing. Most loans also have a maturity
date by which time the borrower must have repaid the loan. Borrowing occurs informally from family and friends, at the retail level through a bank, and
also on a large scale involving governments and institutional investors.
b.) Ten generally accepted accounting principles
- GAAP (generally accepted accounting principles) is a collection of commonly followed accounting rules
and standards for financial reporting. The acronym is pronounced gap. GAAP specifications include
definitions of concepts and principles, as well as industry-specific rules. The purpose of GAAP is to ensure
that financial reporting is transparent and consistent from one public organization to another, and from one
accounting period to another.

GAAP is outlined by the following 10 general concepts or principles.

1. Regularity. The business and accounting staff apply GAAP rules as standard practice.
2. Consistency. Accounting staff apply the same standards through each step of the reporting process

and from one reporting cycle to the next, paying careful attention to disclose any differences.
3. Sincerity. Accounting staff provide objective and accurate information about business finances.
4. Permanence. Accounting staff use consistent procedures in financial reporting, enabling business

finances to be compared from report to report.

5. Noncompensation. Accountants provide complete transparency of positive and negative factors

without any compensation. In other words, they do not get paid based on how good or bad the reporting
turns out.
6. Prudence. Financial data is based on documented facts and is not influenced by guesswork.
7. Continuity. Financial data collection and asset valuations should not disrupt normal business

operations.
8. Periodicity. Financial data should be organized and reported according to relevant accounting periods.

For example, revenue or expenses should be reported within the corresponding quarter or other
reporting period.
9. Materiality. Accountants must rely on material facts and disclose all material financial and accounting

facts in financial reports.

10. Good Faith. There is an expectation of honesty and completeness in financial data collection and
reporting

c.) 3 types of public sector audit

 d.) The accounts maintained by local government units. Relate to what internal
control system is, and its rationale.

3. Present a comparative matrix on the sources of revenue, including rates and sharing,
for LGUs: Barangay, Municipality, Highly Urbanized or Component City, and Provinces.

4. Define and explain the following connecting to spending, the reason why the
government prepare a new budget every year:
a.) “financing program”
b.) "national government budget”
c.) “one fund budget”
d.) “Policy-based budgeting”
e.) “planning-programming budgeting system”

5. a.) Illustrate and discuss comparatively the national and local budget process. Include
the reviewing authority of all LGU levels.
b.) Discuss briefly the process and documents required in a Barangay Budgeting Process.
Include the calendar.
C.) What are existing and continuing appropriation? How about automatic
appropriation? Define each, provide legal bases and explain its rationale.

6. a.) On procurement, what procurement process may be had in times of emergencies?

When can a procurement entity resort to such mode?
b.) In your understanding, briefly illustrate and discuss local government procedure,
process and activity flow of supplies management.
b.) Enumerate and discuss the phases of property and supply management?

7. Mayor Adela, Accountant Marie, Budget Officer Candice, Planning Officer Pette and
Treasurer Aimy procured and paid five (5) units Komatsu Crawler Backhoe in February
2021. If you were the auditor (COA), having studied Public Fiscal Administration in
your MPA class, discuss briefly the process and documents you will look into from
revenue generation – sources of fund, annual budget inclusion, allocation, procurement,
and accounting to its issuance and assignment to accountable office or officer.

8. The Public Financial Management (PFM) Reform Program aims to improve efficiency,
accountability and transparency in public fund use in order to ensure the direct,
immediate, substantial and economical delivery of public services especially to the poor.
The Program implements the key strategies of the Philippine PFM Reform Roadmap:
Towards Improved Accountability and Transparency (2011-2016), a comprehensive
reform agenda. Explain PFM’s purpose, namely: a.) seeks to clarify, b.) simplify, c.)
improve and d.) harmonize the government’s financial management processes and
information systems.

9. Enumerate, provide legal bases and explain the mandatory expenses of and the
limitations on local government units Annual Budgets. Why the need to limit when
LGUs should have fiscal autonomy? (PS, LGDF, GADF, LDRRMF, PO and CF, others)
Explain and Provide legal basis.
 10. a.) Discuss the General Provisions of the Taxing Powers of the LGUs (Province, City,
Municipality, Barangay);
b.) Enumerate, give example and briefly discuss the Fundamental Principles of Local
Fiscal Administration; and

11. a.) Draft a project proposal that you should suggest to a city government to provide
intervention to the inflation induced dive of economic, social and environmental
performance of the Philippines.
b.) Present a complete Project Design for the approval of your City Mayor.Cite
challenges and recommend programs to arrest issues confronting our localities, to
achieve economic boost, social assistance and social development.

12. What is your take-away from the subject Public Fiscal Administration, as a career-
person, as a family member and a member of the community? How can you use the
learning to assist your family, your office and your community?

GOOD LUCK. /dett

SUBMISSION INSTRUCTION:

Submit and email Final Exam Answer Sheet to debietorres@yahoo.com

using Subject/file name: Final Exam Family Name First Name (Final Exam
Torres Debie)