THE BUDGET CYCLE

BUDGET REVIEW
(Nov 11 – Dec 15)
 

What does the Local Government Code (RA

7160) say?

The Sangguniang Panlungsod or

Sangguniang Bayan concerned shall have the
power to review the barangay ordinance
authorizing the annual appropriations to
ensure that the provisions of RA 7160 are
complied with (Sec. 333).
The GAO, authorizing the annual
or supplemental budget is
submitted for review within
ten (10) days after its
enactment to the
Sangguniang Panglungsod/
Bayan. The purpose of the
Budget Review are the
following:

• To ensure that the budgetary

requirements and general
limitations provided in the
Code are complied with;
• The budget does not exceed
the estimated receipts and/or
income of the barangays;
• The items of appropriations
are not more than those
provided by existing laws.
 STEPS IN BUDGET REVIEW
1. Review within 60 days upon receipt
2. Declare the Barangay Budget Operative
3. Declare the Barangay Budget
inoperative in its entirety
4. Declare the Barangay Budget
inoperative in part
5. Check consistency of GAO with AIP
and ELA
6. Appeal for reconsideration in case of
Conflict in Budget Review
STEP 1. Review within 60 days upon
receipt

The Sangguniang
Panglungsod /Bayan,
through the City/Municipal
Budget Officer shall review
the barangay budget within
60 days upon receipt of the
appropriation ordinance.
 Presumption of Regularity
An appropriation ordinance
submitted for statutory review
carries with it a presumption of
regularity not only as to its
contents but also as to its
enactment by the Sanggunian.
Contents are proper until ruled
otherwise in the review
Enactment presumed valid
 Nature of the Review Action
 Does not supplant the act of the
Sanggunian.
 Determines whether the appropriation
ordinance submitted has complied with
the provisions of the law.
Does not authorize an item or any item of
appropriation that is specifically
prohibited by law.
Does not affect the effectivity of the
appropriation ordinance.
 Review Action and its Effects
1. Declare an Appropriation Ordinance
operative in toto
 When it fully complies with
budgetary requirements and general
limitations.
Effect: - it shall continue to be in full force
and effect at the beginning of the fiscal
year in the case of annual budget, or
upon its approval or on the date fixed in
the ordinance in the case of the
Supplemental Budget
Review Action and its Effects
2. Declare the Budget inoperative it its
entirety.
1. When the aggregate amount appropriated
exceeded the estimates of income (Sec. 324),
or
2. When no sufficient provision is
appropriated for payment of loans and other
indebtedness incurred or redeem or retire
bonds, debentures, securities, notes and
other obligations (Sec. 303)
Effect: - Operate under a reenacted budget until
such time the new annual appropriation
ordinance shall have met the objections raised
(Sec. 333).
Inoperative Budget..
A barangay budget that is declared
inoperative in its entirety shall be returned
to the Punong Barangay for proper
adjustments/revisions. The barangay
treasurer shall not make any further
disbursements from the inoperative
budget.
The Barangay shall operate on a reenacted
budget or the budget of the previous year
until the new appropriation ordinance is
declared operative or approved by the
Sangguniang Panglunsod or Bayan.
Disadvantages of a re-enacted budget

1. No new projects can be

undertaken;
2. New positions cannot be filled;
3. No new equipments can be
acquired;
4. Non-recurring activities, no matter
how vital, cannot be undertaken;
and
5. No increase in honoraria and other
benefits.
 Review action and its effect
3. Declare the barangay budget
inoperative in part.
1. The budget has not complied with
some budgetary requirements or
general limitations;
2. Some items in the budget was
disallowed.
Inoperative in part..

Only the items that have not

been disallowed or reduced
shall continue to be in full
force and effect.
Appeal for reconsideration in case of
Conflict in Budget Review
In case of conflict in the review of its
budget, the Barangay may make an
appeal to any of the following:

1. City/Municipal Legal Officer assigned to

review and submit recommendation
on approved ordinances and
executive orders issued;
2. DBM Regional Office for technical
assistance.
thank you