518 Hand-Outs 5 PDF

REVISED CHART OF ACCOUNTS UNDER THE NGAS
Chart of Accounts is a list of account titles and codes that guides the bookkeeper in the recording of
government transactions. It provides the framework within which the accounting
records are constructed.
Standard Government Chart of Accounts (SGCA) is a list of general ledger accounts prepared for
the use of National, Local and Government Owned or Controlled Corp design to achieve
the objectives of uniformity in accounting and reporting, facilitate in consolidating
financial reports and adaptability in computerization.
Coding the systematic assignment of number, letters or other symbols to distinguish items within a
given classification from each other.
Purposes: 1. To save time and clerical work in recording names of accounts, funds,
projects, allotments and expenditures.
2. To facilitate location of accounts in the general and subsidiary ledger.
3. To facilitate systematic arrangement and classifying of accounts; and
4. To comply with the requirements of mechanized accounting.
COA Circular No. 2013-002 dated January 30, 3013Adoption of the Revised Chart of Accounts for
National Government Agencies. The effectivity is January 1, 2014.
Objectives:
1.
To provide new accounts for the adoption of the Philippine Public Sector Accounting
Standards (harmonized with IPSAS)
2.
To provide uniform accounts for national government accounting and budget systems to
facilitate the preparation of harmonized financial and budgetary accountability reports
3.
To expand the account code from three (3) digits in the NGAS Chart of Accounts to eight
(8)
digits, to allow expansion or creation of new accounts as may be necessary to implement new
standards or policies and provide up to four levels of consolidation depending on the users
information needs.
Major Changes:
A. Coverage is limited only to all national government agencies and GOCCs receiving funds
constituted as Special Accounts in the General Fund (SAGF) from the National Government
B. Expanded account code structure - from three (3) digits to eight (8) digits
COA Revised Chart of Accounts ACCOUNT CODE STRUCTURE

0 00 00 00 0
Account Group -------------------------------Major Account Group -----------------------------Sub-Major Account Group ------------------------------General Ledger Accounts -------------------------------------General Ledger Contra-Accounts -----------------------------------ACCOUNT GROUPS
Codes are assigned to account groups to facilitate location of accounts in the general and
Subsidiary ledgers, to provide systematic arrangement and classification of accounts and
facilitate preparation of the consolidated financial reports as follows:
Code
Account Groups
1
Assets
2
Liabilities
3
Equity
4
Income
5
Expenses
C.. New accounts were provided for the implementation of the PPSAS.
D. Some accounts were deleted since these accounts are for use by local government units or
government-owned and/or controlled corporations, while other accounts are no longer
applicable to national government agencies.
E. Some accounts were either expanded or compressed. For instance, expense accounts for
Repairs and maintenance and depreciation of property, plant and equipment which were
Previously presented per asset account were compressed based on the major account
classification
COA Circular No. 2014-003 dated April 15, 2014Conversion from the Philippine Government Chart
of Accounts under the New Government Accounting System per COA Circular No. 2004
-008 dated September 20, 2004 as amended, to the Revised Chart of Accounts for National
Government Agencies under COA Circular No. 2013-002 dated January 30, 2013,
additional accounts/revised description/title of accounts and relevant Accounting Policies
and Guidelines in the Implementation thereof
COA Circular No. 2014- 003 dated April 15, 2014 Re: Conversion from the PGCA to RCA
PURPOSE:
1. Provide guidelines and procedures on the conversion of the PGCA to the RCA
2. Provide accounting policies and guidelines on the implementation of the RCA for NGAs
3. Provide additional and revised description title of accounts for proper implementation of the
new and revised accounting policies
Coverage:
Shall be adopted for all funds of NGAs and for Special Accounts in the General Fund
(SAGF) maintained by GOCCs
For agencies implementing the eNGAS , procedures on the Conversion of the eNGAS
databases to the RCA for NGAs shall be covered by separate guidelines
The Chart of Accounts for GOCCs and LGUs and its conversion shall be covered by
separate guidelines
Basis for Conversion Balance Sheet as of December 31, 2013
General Guidelines and Procedures
All NGAs and GOCCs with SAGF shall effect the conversion based on the Balance Sheet
as of December 31, 2013
The Chief Accountants/Heads of Accounting units shall be guided by the Matrix on the
Conversion of Accounts
The Chief Accountants/Heads of Accounting units shall carefully analyze the GL and SL
accounts before conversion
Any clarification or request for assistance shall be directed to the Government

Accountancy Sector (GAS), COA
Specific Guidelines/Procedures
1.
Analyze balances as of December 31, 2013
2.
3.
Prepare JEVs to close the accounts and transfer to the appropriate account
Furnish COA Auditor and GAS copies of the JEVs
Specific Accounting Policies and Guidelines
1.
Maintenance of NG books shall be discontinued. . A separate set of books shall be

maintained by fund. . All balances as of December 31, 2013 shall be transferred to the
appropriate new books.
a.
Bases shall be the law creating the fund
b.
Copies of the JEV shall be furnished the COA Auditor and the COA- GAS
separately
2.
Appropriate SLs shall be maintained for real accounts and for some income and expense
accounts
3.
Public Infrastructures and Reforestation projects shall be recorded in the appropriate fund
using PPE account
a. Based on acquisition cost showing the computed depreciation or appraised value
whichever is determinable
4.
Revenue/Income shall be recognized by the revenue generating agency using the
appropriate revenue/income accounts whether authorized to use or not
5.
For Revolving Funds, income and expenses shall be recognized, the net surplus of which
shall form part of the equity of said fund
Specific Guidelines/Procedures
ITEMS IN TRANSIT (284)
If the balance pertains to delivered items but not recorded, determine the reason for not recording the
ransaction and work for the gathering of the supporting documents to warrant the recording in the
books of accounts.
If the balance pertains to fixed assets that were converted to 284 upon implementation of the NGAS
and which remain undelivered as of December 31, 2013, close the said account to Government
Equity.
In conformity with PPSAS 1, the title of the following accounts shall be revised:
Account Government Equity (30101010) shall be changed to Accumulated Surplus/Deficit
(30101010).
Account Income and Expense Summary (30301010) shall be changed to Revenue and Expense
Summary (30101010).
Transitory Provisions
A. New account titles should be used in the implementation of the PPSAS
B. Accounts that have not been converted due to issues not settled as of the conversion date shall be
converted to the most appropriate account in the RCA until further defined
Responsibility
The Chief Accountants/Heads of Accounting units and Budget Officers/Heads of Budget Office/
units shall be responsible for the conversion of these accounts.
COA Resolution No. 2014-003 dated January 24, 2014 Adoption of the Philippine Public Sector
Accounting Standards (PPSAS)
The Philippine Public Sector Accounting Standards (PPSAS)

Legal Basis Art. IX-D 1987 Philippine Constitution
To promulgate auditing and accounting rules and regulations so as to facilitate the keeping, and
enhance the information value of the accounts of the government.
COA Resolution No. 2014-003 dated January 24, 2014 Adoption of the Philippine Public
Sector Standards (PPSAS).

Functions of the Public Sector Accounting Standards Board(PSAcSB)
1.
Assist the COA Commission Proper in formulating and implementing accounting standards for
the public sector.
2.
Establish and maintain linkages with the international bodies, governing organizations and
academe on accounting related fields on financial management.
Basis of PPSAS:
Pronouncements issued by IPSASB, IASB< PICPA, International Organization of Supreme
Audit Institutions and others
Relevant factors, including best accounting practices, and

Capacity of agencies to comply with PPSAS.
Objectives
To set out the recognition, measurement, presentation and disclosure requirements for
financial reporting the Philippine government.
Scope:
1.
PPSASs set out requirements dealing with transactions and other events in general
purpose
financial reports.
2.
PPSASs are designed to apply to the general purpose financial reports of all public
sector
entities other than Government Business Enterprises (GBEs)
3.
Applies to all NGAs, LGUs and GOCCs not classified as GBEs
PPSAS consists of:
1. International Public Sector Accounting Standards (IPSASs) (Accrual Based IPSASs per 2012
Handbook) developed by IPSASB and published by the International Federation of Accountants
(IFAC), and
2. Philippine Application Guidance (PAG)Philippine Application Guidance (PAG)
3. Provide supplementary guidance of IPSASs to suit the Philippine public sector situation.
4. States the reason for not adopting some paragraphs of the IPSASs.
PPSAS 1- Presentation of FS
Complete set of Financial Statements:
1. Statement of financial position
2. Statement of financial performance
3. Statement of changes in net assets/ equity
4. Cash Flow Statement
5. Notes, comprising a summary of significant accounting policies and other explanatory notes
6. Separate additional statements for comparison of budget and actual amounts shall be
prepared and submitted
PPSAS 2- Cash Flow Statement
Objective:
1.
To set overall considerations for the:
2.
Provisions of information about changes in cash and cash equivalents by means of a cash
flow statement.
3.
Classifies cash flows during the period from operating, investing and financing activities
Salient Features
1. Cash flows for operating activities are reported using the direct method.
2. Cash flows exclude movements between items that constitute cash or cash equivalents.
3. Investing and financing transactions that do not require the use of cash shall be excluded from
the cash flow statement, but they shall be separately disclosed
PPSAS 3 - Accounting Policies, Changes in Accounting Estimates and Errors
Salient Features
1.
Changes in Accounting Estimates
a. Follow transition requirements
b. If the change is voluntary, apply the new accounting policy retrospectively by
restating prior periods.
2.
Effect of a change in estimate is accounted for by including it in net income or
comprehensive income as appropriate in:
a. The period of change if the change affects that period only.
b. The period of change and future periods if the change affects both
PPSAS 4 The Effects of Changes in Foreign Exchange Rates

Salient Features
1.
Covers Foreign currency transactions and Foreign operations.
2.
Translation should be done for foreign currency items into functional currency.
3.
Initial recognition and measurement record the spot exchange rate
PSAS 5 Borrowing Costs
Salient Features
1.
Borrowing costs shall be charged to expenses in the period when they are incurred.
(Benchmark treatment)
2.
Borrowing costs directly attributable to the acquisition, construction, or production of a
qualifying asset shall be capitalized as part of the cost of that asset. (Allowed Alternative
Treatment)
3.
For borrowing costs pertaining to loans borrowed by the National Government (NG)
which are recorded by the Bureau of the Treasury, the benchmark treatment shall be
used. However for loans borrowed directly by the NGAs and LGUs, the allowed
alternative treatment shall be used
PPSAS 6 Consolidated and Separate Financial Statement
Salient Features
Prescribes requirements for preparing and presenting consolidated FS for an economic entity
under the accrual basis of accounting.
A controlled entity is an entity controlled by another entity, known as the controlling entity.
Balances, transactions, revenue and expenses between entities within the economic entity
are eliminated in full
PPSAS 8 Interests in Joint Ventures
Salient Features
1. The key characteristic of a joint venture is a binding arrangement whereby two or more
parties are committed to undertake an activity that is subject to joint control.
2. Joint ventures may be classified as jointly controlled operations, jointly controlled assets
and jointly controlled entities. Different accounting treatments apply for each type of
joint venture
PPSAS 9 - Revenue from Exchange Transactions

Salient Features
1.
Applies to revenue arising from the following exchange transactions and events:
2.
The rendering of services.
3.
The sale of goods, and
4.
The use of others of entity assets yielding interest, royalties and dividends.
5.
Revenue shall be measured at the fair value of the consideration received or receivable
PPSAS 12 Inventories
Salient Features
1.
Inventories are measured at the lower of cost and net realizable value.
2.
If acquired through a non exchange transaction, their cost shall be measured as their fair
value as at the date of acquisition.
3.
Cost is determined on weighted average basis
4.
Write-downs to net realizable value are recognized as an expense. Reversals arising from
an increase in net realizable value are recognized as reduction of the inventory expense in the
period in which they occur
PPSAS 13 Leases
Salient Features
1. Lease is classified as a Finance lease if:

(a) The lease transfers ownership of the asset to the lessee by the end of the lease term.
(b) The lessee has the option to purchase the asset at a price that is expected to be
sufficiently lower than the fair value.
(c) The lease term is for the major part of the economic life of the asset.
2. Operating lease does not transfer substantially all the risks and rewards incidental to
ownership of the asset.
PPSAS 14 Events After the Reporting Date
Definitions
1.
Adjusting events after the reporting date- events that provide evidence of conditions
that existed at the reporting date.
2.
Non-Adjusting events after the reporting date - those that are indicative of conditions
that arose after the reporting date.
An entity shall disclose:
1.
The date its financial statements were authorized for issue, and
2.
Who gave that authorization
PPSAS 16Investment Property
Salient Feature
1.
Investment property- is property (land or a building or part of a building, or both) held
to earn rentals for capital appreciation, or both, rather than for:
a) Use in the production or supply of goods or services, or for administrative purposes; or
b) Sale in the ordinary course of operations.
2. Investment Property- Shall be measured initially at cost. If acquired through non-exchange
transaction- Fair value as at date of acquisition
PPSAS 17 Property, Plant and Equipment

Salient Features
1.
Initial recognition is at cost, its cost is its fair value as at the date of acquisition.
2.
Infrastructure assets are accounted as PPE
3.
The carrying amount of an item of property, plant and equipment shall be derecognized:
a) On disposal; or
b) When no future economic benefits or service potential is expected from its use or disposal
PPSAS 19 Provisions, Contingent Liabilities and Contingent Assets
Salient Features:
Recognize a provision only when:
1.
A past event has created a present legal or constructive obligation.
2.
An outflow of resources to settle the obligation is probable, and
3.
There is a reliable estimate of the obligation
Salient Features
Contingent Liability arises when there is:
1.
Possible obligation to be confirmed by a future event that is outside the control of the
entity; or
A present obligation may, but probably will not require an outflow of resources,
or
A reliable estimate cannot be made.

Contingent liabilities require disclosure only (no recognition). If the possibility of outflow is
remote, then no disclosure.

Salient Features
1. Contingent asset arises when the inflow of economic benefits or service potential is probable,
but not virtually certain, and occurrence depends on an event outside the control of the
entity.
2. Contingent assets require disclosure only (no recognition). If the realization of revenue is
virtually certain, the related asset is not a contingent asset and recognition of the asset and
related revenue is appropriate
PPSAS 20- Related Party Disclosures
Salient Features
1.
Related Parties are parties that control or have significant influence over the reporting
entity and parties that are controlled or significantly influenced by the reporting entity.
2.
Requires disclosure of:
3.
Relationship involving control, even when there have been no transactions in between;
Related party transactions; and

4.
Management compensation
PPSAS 21 Impairment of Non-Cash-Generating Assets
Definition
Cash - generating assets - are assets held with the primary objective of generating a
commercial return.
Non-cash - generating assets- are assets other than cash-generating assets.
Impairment - a loss in the future economic benefits or service potential of an asset, over and
above the systematic recognition of the loss of the assets future economic benefits or
service potential through depreciation
Salient Features
1. A non-cash-generating asset is impaired when the carrying amount of the asset exceeds its
recoverable service amount.
2. An impairment loss shall be recognized immediately in surplus or deficit.
3. After the recognition of an impairment loss, the depreciation charge for the asset shall be
adjusted in future periods.
PPSAS 23 Revenue from Non-Exchange
Transactions (Taxes and Transfers)
Non-Exchange transactions
Examples:
(a) Taxes; and
(b) Transfers (whether cash or non-cash)
1. An asset acquired through a non exchange transaction shall initially be measured as its fair
value as at the date of acquisition.
2..An entity shall recognize an asset in respect of taxes when the taxable event occurs and
the asset recognition criteria are met
PPSAS 24 Presentation of Budget Information in Financial Statements
Salient Features
1. Presentation of budget information in the financial statements when the reporting entity is
publicly accountable for its budget.
2. Disclosure of an explanation of the reasons for material differences between the budget and
actual amounts.
To ensure that the public sector entities discharge their accountability obligations and enhance the
transparency of their financial statements.
PPSAS 26 Impairment of Cash Generating Assets

Definition
Cash-Generating Assets (CGA) - Assets held with the primary objective of generating a
Commercial return.
Impairment - a loss in the future economic benefits or service potential of an asset.
An impairment loss of a cash- generating asset - is the amount by which the carrying amount of an
asset exceeds its recoverable amount.
PPSAS 27 Agriculture
Salient Features
Prescribes the accounting treatment and disclosures related to agricultural activity.
Agricultural activity - management by an entity of the biological assets for sale, or for distribution
at no charge or for a nominal charge or for conversion into agricultural produce
or into additional biological assets.
PPSAS 28 Financial Instruments Presentation

Prescribes principles for classifying and presenting financial instruments as liabilities or net
assets/equity, and for offsetting financial assets and liabilities
IPSAS 29 Financial Instruments: Recognition and Measurement
Established principles for recognizing, derecognizing and measuring financial assets
and financial liabilities.
IPSAS 30 Financial Instruments: Disclosure
Prescribe disclosures that enable financial statement users to evaluate the significance of
financial instruments to an entity, the nature and extent of their risks, and how the entity
manages those risks.
PPSAS 31 Intangible Assets
Salient Features
1. Intangible Asset is an identifiable non-monetary asset without physical substance.
2. An intangible asset, whether purchased or self-created, is recognized if:
- It is probable that the future economic benefits or service potential that are attributable
to the asset will flow to the entity and
3. The cost or fair value of the asset can be measured reliably.
4. All research costs are charged to expense when incurred
PPSAS 32 Service Concession Arrangements: Grantor
Grantor- public sector entity grants service concession arrangements.
Operator - private sector which manages the service concession asset
Service concession arrangement- sets performance standards, mechanism for adjusting prices ,
and arrangements for arbitrating disputes.
Service concession assets - turned over to the grantor
PPSAS 32 Service Concession Arrangements: Grantor
1. Recognize liability when the grantor recognizes a service concession asset
2. Initial measurement - same amount as the asset adjusted by any consideration given by the
grantor or the operator or from the operator to the grantor.
3..The operator is compensated for its service over the period of the service concession arrangement
When the people become involved in their government, government becomes more
accountable,
and our society is stronger, more compassionate, and better prepared for the challenges of the
future.
ARNOLD SCHWARZENEGGER
INTRODUCTION
Recent developments brought about by the Philippine Public Financial Management Reforms
and significant changes in the field of accounting prompted the harmonization of the existing accounting
standards with the international accounting standards. This Commission revised the New Government
Accounting System (NGAS) Manual prescribed under Commission on Audit (COA) Circular No.
2002-002 dated June 18, 2002 to make it responsive to dynamic changes and modern technology.
Legal Basis. The Government Accounting Manual (GAM) is prescribed by COA pursuant to Article IX-D,
Section 2 par. (2) of the 1987 Constitution of the Republic of the Philippines which provides that:
The Commission on Audit shall have exclusive authority, subject to the limitations in this Article, to
define the scope of its audit and examination, establish the techniques and methods required therefore
, and promulgate accounting and auditing rules and regulations, including those for the prevention and
disallowance of irregular, unnecessary, excessive, extravagant, or unconscionable expenditures, or uses
of government funds and properties". (Underscoring supplied)
Coverage. This Manual presents the basic accounting policies and principles in accordance with the
Philippine Public Sector Accounting Standards (PPSAS) adopted thru COA Resolution No. 2014003 dated January 24, 2014 and other pertinent laws, rules and regulations. It includes the Revised
Chart of Accounts (RCA) prescribed under COA Circular No. 2013-002 dated January 30, 2013,
as amended; the accounting procedures, books, registries, records, forms, reports, and financial
statements; and illustrative accounting entries. It shall be used by all National Government
Agencies (NGAs) in the:
(a). preparation of the general purpose financial statements in accordance with the PPSAS and
other financial reports as may be required laws, rules and regulations; and
(b) reporting of budget, revenue and expenditure in accordance with laws, rules and
Definition of Terms. For the purpose of this Manual, the terms used as stated below shall be construed to
mean as follows:
a.
Accrual basis means a basis of accounting under which transactions and other events are recognized
when they occur (and not only when cash or its equivalent is received or paid). Therefore, the transactions
and events are recognized in the accounting records and recognized in the financial statements of the
periods to which they relate. The elements recognized under accrual accounting are assets, liabilities, net
assets/equity, revenue, and expenses.
b.
Assets are resources controlled by an entity as a result of past events, and from which future economic
benefits or service potential are expected to flow to the entity.
c.
Contributions from owners means future economic benefits or service potential that have been
contributed to the entity by parties external to the entity, other than those that result in liabilities of the
entity, that establish a financial interest in the net assets/equity of the entity, which:
1.
conveys entitlement both to (i) distributions of future economic benefits or service potential by
the
entity during its life, such distributions being at the discretion of the owners or their representatives;
and to (ii) distributions of any excess of assets over liabilities in the event of the entity being wound
up; and/or
2.
can be sold, exchanged, transferred, or redeemed.
d..Entity refers to a government agency, department or operating/field unit. It may be referred to in this
GAM as an agency.
eExpenses are decreases in economic benefits or service potential during the reporting period in the form
of outflows or consumption of assets or incurrence of liabilities that result in decreases in net assets or
equity, other than those relating to distributions to owners.
f. Government Accounting encompasses the processes of analyzing, recording, classifying, summarizing
and communicating all transactions involving the receipt and disposition of government funds and
property, and interpreting the results thereof. (Sec. 109, Presidential Decree (P.D.) No. 1445)
h. Government Budget is the financial plan of a government for a given period, usually for a fiscal year,
which shows what its resources are, and how they will be generated and used over the fiscal period. The
budget is the government's key instrument for promoting its socio-economic objectives. The government
budget also refers to the income, expenditures and sources of borrowings of the National Government
(NG) that are used to achieve national objectives, strategies and programs.
i.
Liabilities are firm obligations of the entity arising from past events, the settlement of which is expected
to result in an outflow from the entity of resources embodying economic benefits or service potential.
j. Net assets/equity is the residual interest in the assets of the entity after deducting all its liabilities.
k. Revenue is the gross inflow of economic benefits or service potential during the reporting period when
those inflows result in an increase in net assets/equity, other than increases relating to contributions
from owners.
l. Revenue funds comprise all funds derived from the income of any agency of the government and
available for appropriation or expenditure in accordance with law. (Section 3, P.D. No. 1445)
Responsibility, Accountability and Liability over Government Funds and Property

A. Responsibility over Government Funds and Property
1. It is the declared policy of the State that all resources of the government shall be managed, expended
or utilized in accordance with laws and regulations, and safeguarded against loss or wastage through
illegal or improper disposition, with a view to ensuring efficiency, economy and effectiveness in the
operations of government. The responsibility to take care that such policy is faithfully adhered to rests
directly with the chief or head of the government agency concerned. (Sec. 2, P.D. No. 1445)
2..Fiscal responsibility shall, to the greatest extent, be shared by all those exercising authority over the
financial affairs, transactions, and operations of the government agency. (Sec. 4(4), P.D. No. 1445)
3.The head of any agency of the government is immediately and primarily responsible for all government
funds and property pertaining to his agency. Persons entrusted with the possession or custody of the
funds or property under the agency head shall be immediately responsible to him, without prejudice to
the liability of either party to the government. (Sec. 102, P.D. No. 1445)
B. Accountability over Government Funds and Property
1. Every officer of any government agency whose duties permit or require the possession or custody of
government funds or property shall be accountable therefore and for the safekeeping thereof in
conformity with law. Every AO shall be properly bonded in accordance with law. (Sec. 101, P.D. No.
1445; Section 50, Chapter 9, Subtitle B, Book V, Executive Order (E.O.) No. 292)
2.Transfer of government funds from one officer to another shall, except as allowed by law or regulation,
be made only upon prior direction or authorization of the Commission or its representative. (Sec. 75,
P.D. No. 1445)
3.When government funds or property are transferred from one AO to another, or from an outgoing officer
to his successor, it shall be done upon properly itemized invoice and receipt which shall invariably
support the clearance to be issued to the relieved or outgoing officer, subject to regulations of the
Commission. (Sec. 77, P.D. No. 1445)
C. Liability over Government Funds and Property
1. Expenditures of government funds or uses of government property in violation of law or regulations
shall be a personal liability of the official or employee found to be directly responsible therefore.
(Sec. 103, P.D. No. 1445)
2.
Every officer accountable for government funds shall be liable for all losses resulting from the
unlawful deposit, use, or application thereof and for all losses attributable to negligence in the keeping
of the funds. (Sec. 105(2), P.D. No. 1445)
3.
No AO shall be relieved from liability by reason of his having acted under the direction of a
superior
officer in paying out, applying, or disposing of the funds or property with which he is chargeable,
unless prior to that act, he notified the superior officer in writing of the illegality of the payment,
application, or disposition. The officer directing any illegal payment or disposition of the funds
or property shall be primarily liable for the loss, while the AO who fails to serve the required notice
shall be secondarily liable. (Sec. 106, P.D. No. 1445)
4.
When a loss of government funds or property occurs while they are in transit or the loss is caused
by
fire, theft, or other casualty or force majeure, the officer accountable therefore or having custody
thereof shall immediately notify the Commission or the auditor concerned and, within 30 days or such
longer period as the Commission or auditor may in the particular case allow, shall present his
application for relief, with the available supporting evidence. Whenever warranted by the evidence,
credit for the loss shall be allowed. An officer who fails to comply with this requirement shall not be
relieved of liability or allowed credit for any loss in the settlement of his accounts.(Sec. 73, PD.1445).
Fundamental Principles for Disbursement of Public Funds. Section 4 of P.D. No. 1445, the
Government Auditing Code of the Philippines, provides that all financial transactions and operations of
any government entity shall be governed by the following fundamental principles:
a.. No money shall be paid out of any public treasury or depository except in pursuance of an appropriation
law or other specific statutory authority.
b. Government funds or property shall be spent or used solely for public purposes.
c. Trust funds shall be available and may be spent only for the specific purpose for which the trust was
created or the funds received.
d. Fiscal responsibility shall, to the greatest extent, be shared by all those exercising authority over the
financial affairs, transactions, and operations of the government agency.
e. Disbursement or disposition of government funds or property shall invariably bear the approval of the
proper officials.
f. Claims against government funds shall be supported with complete documentation.
g. All laws and regulations applicable to financial transactions shall be faithfully adhered to.
h. Generally accepted principles and practices of accounting as well as of sound management and fiscal
administration shall be observed, provided that they do not contravene existing laws and regulations.
Basic Government Accounting and Budget Reporting Principles. Each entity shall recognize and
present its financial transactions and operations conformably to the following:
a.
generally accepted government accounting principles in accordance with the PPSAS and pertinent laws,
rules and regulations;
b. accrual basis of accounting in accordance with the PPSAS;
c. budget basis for presentation of budget information in the financial statements (FSs) in accordance with
PPSAS 24;
d. RCA prescribed by COA;
e. double entry bookkeeping;
f. financial statements based on accounting and budgetary records; and
g. fund cluster accounting
ACCOUNTING FOR DISBURSEMENTS AND RELATED TRANSACTIONS

Disbursements covers the rules and regulations to be followed in the disbursement of public funds,
the monitoring of receipt and utilization of NCA/NTA, preparation and processing of DV/Payroll;
preparation and issue of checks; payment by cash; granting, utilization and liquidation/replenishment of
cash advances; payment through ADA; remittance of taxes withheld through TRA; availment of
foreign loans through suppliers credit/constructive cash; and payment of operating requirements on
FSPs through CDC.
Most of the transactions in the government involve the receipt and disbursement of cash. The
cash transactions affect every classification within the financial statements assets, liabilities, equity,
income and expenses .by check. Thus it is essential that cash transactions are recorded correctly for
reliability in the financial statements. .
.
How to Distinguish Disbursement from Expenditures?
Expenditures are the obligations incurred by the Agency. It includes both the amount actually
paid and those incurred and recorded as liabilities to be paid in the future. While Disbursements are
payments made for such government obligations by cash or check.
Typical transactions for disbursements include the following major classes of payments:
A. Current Operating Expenses
1. Personal Services
Salaries and wages

Other Compensation
Personnel benefits
Other personnel benefits
2. Maintenance and Other Operating Expenses

- travelling expenses
- training and scholarship program
- supplies and material expenses
- repairs, etc.
3. Financial Expenses
- bank charges
- commitment fees
- documentary stamps
- interest and other financial charges
B..Capital Expenditures these expenditures need allotment for CO. As opposed to the current
operating expenses, this involves investments and procurement of assets that is expected
to be used for a longer period of time.
C..Inter-agency fund transfers - this covers the transfer of funds to other agencies for the
implementation of specific projects. This is taken up in the books under Due to by
the receiving agency and Due from by the releasing agency.
Basic Requirements for Disbursements and the Required Certifications.
Disbursements of government funds shall comply with the following basic requirements and
certifications:
1Availability of allotment/budget for obligation/utilization certified by the Budget
Officer/Head of Budget Unit;
2..Obligations/Utilizations properly charged against available allotment/budget by the Chief
Accountant/Head of accounting Unit;
3..Availability of funds certified by the Chief Accountant. The Head of the Accounting Unit
shall certify the availability of funds before an Agency Head or his duly authorized
representative enter into any contract that involves the expenditure of public funds based
on the copy of budget release documents;
4..Availability of cash certified by the Chief Accountant. The Head of the Accounting Unit shall
certify the availability of cash and completeness of the supporting documents in the
disbursement voucher and payroll based on the Registry of Allotments and Notice of Cash
Allocation/Registry of Allotment and Notice of Transfer of Allocation;
5..Legality of the transactions and conformity with existing rules and regulations. The requesting
and approving officials shall ensure that the disbursements of government funds are legal and
in conformity with applicable rules and regulations;
6..Submission of proper evidence to establish validity of the claim. The Head of the Requesting
Unit shall certify on the necessity and legality of charges to allotments under his/her
supervision as well as the validity, propriety and legality of supporting documents. All
payments of government obligations and payables shall be covered by Disbursement Vouchers
(DV)/Payrolls together with the original copy of the supporting documents which will serve as
basis in the evaluation of authenticity and authority of the claim. It should be cleared, however,
that the submission of the supporting documents does not preclude reasonable questions on the
funding, legality, regularity, necessity and/or economy of the expenditures or transactions; and
7.. Approval of the disbursement by the Head of Agency or by his duly authorized representative.
Disbursement or disposition of government funds or property shall invariably bear the approval
of the proper officials. The DVs/Payrolls shall be signed and approved by the head of the
agencies or his duly authorized representatives.
The agency received Notice of Cash Allocation for payment of its obligations. It maybe either for
payment of prior years or current year, the same is recorded as:
Cash MDS, Regular
Subsidy from NG
10104040
40301010
XXXX
XXXX
Certification of Availability of Funds.

No funds shall be disbursed, and no expenditures or obligations chargeable against any
authorized allotment shall be incurred or authorized in any department, office or agency without first
securing the certification of its Chief Accountant or head of accounting unit as to the availability of
funds and the allotment to which the expenditure or obligation may be properly charged.
No obligation shall be certified to accounts payable unless the obligation is founded on a valid
claim that is properly supported by sufficient evidence and unless there is proper authority for its
incurrence. Any certification for a non-existent or fictitious obligation and/or creditor shall be
considered void. The certifying official shall be dismissed from the service, without prejudice to
criminal prosecution under the provisions of the Revised Penal Code.
Any payment made under such certification shall be illegal and every official authorizing or making such
payment, or taking part therein or receiving such payment, shall be jointly and severally liable to the government
for the full amount so paid or received. (Book VI, Section 41 of EO No. 292)
Prohibition against the Incurrence of Overdraft.

Heads of departments, bureaus, offices and agencies shall not incur nor authorize the incurrence
of expenditures or obligations in excess of allotments released by the DBM Secretary for their respective
departments, offices and agencies. Parties responsible for the incurrence of overdrafts shall be held
personally liable therefore. (Book VI, Chapter 5, Section 41 of EO No. 292)
Classification of Expenditures.
Expenditures of NGAs shall be classified into categories as may be determined by the DBM
including, but not limited to the following:
a. Entity incurring the obligation;
b. Program, Activity and Project (PAP);
c. Object of expenditures, including personnel services (PS), maintenance and other operating
expenditures (MOOE), financial expenses (FE), and capital outlays (CO);
d. Region or locality of use;

e. Economic or functional classification of the expenditures;
f. Obligational authority and cash transactions arising from fund releases; and
g. Such other classifications as may be necessary for the budget process.
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 suppliers 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 latters cash requirements.
Obligation Request and Status.
The incurrence of obligations shall be made through the issuance of Obligation Request and
Status (ORS) (Appendix 11). The ORS shall be prepared by the Requesting/Originating Office supported
by valid claim documents like DVs, payrolls, purchase/job orders, itinerary of travel, etc. The Head of
the Requesting or Originating Office or his/her authorized representative shall certify in the Section A of
the ORS as to the necessity and legality of charges to the budget under his/her supervision, and validity,
propriety and legality of SDs. The Head of the Budget Division/Unit shall certify to the availability of
allotment and such is duly obligated by signing in Section B of the ORS.
Subsidiary Record for Obligation.
A subsidiary record to monitor a particular obligation shall be maintained by the Budget
Division/Unit in Section C of the ORS. It shall contain the original amount of obligation, payable (goods
delivered and services rendered) and the actual amount paid.
Adjustment of Obligation.
Adjustment of obligation incurred after the processing of the claim by the Accounting Division
or Unit shall be made through the use of Notice of Obligation Request and Status Adjustment (NORSA).
The adjustment shall be effected through a positive entry (if additional obligation is necessary) or a
negative entry (if reduction is necessary) in the Obligation column of the ORS and RAOD.
Notice of Obligation Request and Status Adjustment.
The NORSA shall be prepared by the Accounting Division/Unit after the processing of the claim
which shall be used in adjusting the original amount obligated to the actual obligations incurred in the
RAOD. It shall be forwarded by the Accounting Division/Unit to the Budget Division/Unit to take up
the adjustments of obligation in the RAOD. The following transactions shall also need adjustments of
obligations:
Transactions
Supporting Documents
a. Refund of cash advance granted during the year Certified copies of official receipts and other SDs
b. Over/Underpayment of expenditures
during the year
Certified copies of official receipts and bills

and other SDs
c..Disallowances pertaining to expenses incurred

during the validity period
Certified copies of official receipts and bills,

notice of the budget that the disallowances
became final and executory during the same
period.
Modes of disbursement in the government:

1. by check thru MDS checks or commercial checks
2. Treasury single account (TSA)
3. by cash cash advances granted to disbursing officer and petty cash fund.
4. Advices to Debit account (ADA)
5. Non-Cash Availment Authority (NCAA)
Disbursement by Checks Checks shall be drawn only on duly approved DV or PCV. These shall be
reported and recorded in the books of accounts only when actually released to the respective payees.
Two types of checks are being issued by government agencies:
1. Modified Disbursement System (MDS) checks issued by government agencies chargeable
against the account of the Treasurer of the Phil which are maintained with different MDS
Governemnt Servicing Banks. These are covered by Notice of Cash Allocation, an authorization
issued by the DBM to all government agencies to withdraw cash from the National Treasury
through the issuance of MDS checks or other authorized mode of disbursements.
2. Commercial checks issued by government agencies chargeable against the agency checking
account with GSBs. These are covered by income/receipts authorized for deposits with AGDBs
and funding checks received by RO/OUs from CO/ROs respectively.
Accounting Books, Records, Forms and Reports to be Prepared and Maintained.
All checks drawn during the day, whether released or unreleased including cancelled checks shall
be recorded chronologically in the Checks and ADA Disbursements Record (CkADADRec) maintained
by the Cash/Treasury Unit. The dates the checks were actually released shall be indicated in the
appropriate column provided for in the CkADADRec. All checks/ADA drawn whether released or
unreleased shall be included in the Report of Checks Issued (RCI) or Report of ADA Issued (RADAI),
which shall be prepared daily by the Cashier.
The RCI/RADAI together with the original copies of the supporting documents (SDs) shall be
submitted to the Accounting Division/Unit for the preparation of JEV. At the end of the year, a Schedule
of Unreleased Commercial Checks shall be prepared by the Cashier for submission to the Accounting
Division/Unit for adjustments.
Disbursements by Cash.
Cash disbursements constitute payments out of cash advances granted to the regular and special
disbursing officers for personal services, petty expenses and MOOE for field operating requirements.
All cash payments shall be covered by duly approved DVs/payrolls/petty cash vouchers (PCVs).
The cash advances may be granted to the cashiers/disbursing officers/officials and employees to cover
the following: salaries and wages, travels, special time-bound undertakings and petty operating
expenses. The granting and liquidation of cash advances shall be governed by the following existing
COA rules and regulations and other pertinent issuances:
a. No cash advance shall be given unless for a legally authorized specific purpose;
b. A cash advance shall be reported on and liquidated as soon as the purpose for which it was given
has been served;
c..No additional cash advance shall be allowed to any official or employee unless the previous cash
advance given to him/her is first settled/liquidated or a proper accounting thereof is made;
d..Except for cash advance for official travel, no officer or employee shall be granted cash advance
unless he/she is properly bonded in accordance with existing laws or regulations. The amount of
cash advance which may be granted shall not exceed the maximum cash accountability covered
by his/her bond;
e..Only permanently appointed officials shall be designated as disbursing officers;

f. Only duly appointed or designated disbursing officer may perform disbursing functions. Officers
and employees who are given cash advances for official travel need not be designated as
Disbursing Officers;
g. Transfer of cash advance from one accountable officer to another shall not be allowed; and
h. The cash advance shall be used solely for specific legal purpose for which it was granted. Under
no circumstance shall it be used for encashment of checks or for liquidation of a previous cash
advance.
The specific rules and regulations on the granting, utilization and liquidation of cash advances are
provided for under COA Circular No. 97-002 dated February 10, 1997, as amended by COA Circular
No. 2006-005 dated July 13, 2006.
Cash Advance for Payroll.
Advances for Payroll shall be granted to Regular Disbursing Officers for payment of salaries,
wages, honoraria, allowances and other personnel benefits of officials and employees. The Advances for
Payroll shall not be used for encashment of checks or for liquidation of previous or other types of cash
advances. It shall be equal to the net amount of the processed payroll corresponding to the pay period.
Liquidation of the advances shall be made within five (5) days after the end of the pay period. Any
unclaimed salaries/allowances shall be refunded and issued official receipt to close the account.
The Disbursing Officer shall maintain the Cash Disbursements Record (CDRec) to monitor the
cash advances/payroll, current operating expenses, and special purpose/time-bound undertakings and
prepare the Report of Cash Disbursements (RCDisb) to report its utilization. Payments shall be based
on duly approved Payroll and shall be posted by the Designated Staff to the IP. The JEV shall be
prepared based on the RD and shall be recorded in the CDJ.
Illustrative Accounting Entries for Granting and Liquidation of Advances for Payroll and the Set-up of
Salary Deductions and Due to Officers and Employees
Account Title
Account Code
Debit
Credit
1. Set-up of Due to Officers and Employees and Salary Deductions Assumptions:
Salaries and Wages
P35,000
PERA
15,000
Total
50,000
Less: Salary Deductions
Withholding Tax
5,000
Life and Retirement
Premiums
3,000
Pag-IBIG premiums
500
PhilHealth premiums
600
GSIS Salary loan
200
Employees' Association
100 9,400
Net Amount
P40,600
=======
Salaries and Wages-Regular
PERA
Due to BIR
Due to GSIS
01 Life and Retirement
50101010
50102010
20201010
20201020
P 35,000
15,000
P 5,000
3,200
Premiums
02 Salary Loan
3,000
200
Due to Pag-IBIG
20201030
Due to PhilHealth
20201040
Other Payables
29999990
Due to Officers and Employees
20101020
To recognize payable to Officers and employees and to set up salary deductions
2. Granting of Advances for Payroll

Advances for Payroll
19901020
P 40,600
Cash-MDS, Regular
10104040
To record grant of advances to cover payment of salaries and wages
Of employees
3. Liquidation of Payroll Fund
20101020
P 40,600
Advances for Payroll
19901020
To recognize liquidation of Advances for Payroll based on the RCDisb and SDs
500
600
100
40,600
P 40,600
P 40,600
Cash Advances for Operating Expenses of Government Units without Complete Set of Books of Accounts.
Field/Extension/Satellite Offices are some of the government units under the central/regional/district
offices without complete set of books of accounts. Those offices may be granted cash advances covering two
months requirements for MOOE/authorized expenses to finance their operations. The cash advance shall be
granted to the duly designated or appointed Disbursing Officers.
Illustrative Accounting Entries to be recorded in the Central/Regional/Division Office or OU Books for
Advances for MOOE/Authorized Expenses Granted to Government Units without Complete Set of Books
of Account
Account Title
Account Code
Debit
Credit
Central/Regional/Division Office or OU Books Assumptions:
Estimated Expenses for 2 months requirements:
Office Supplies Expenses P 10,000
Traveling Expenses
15,000
Water Expenses
8,000
Telephone Expenses
5,000
Electricity Expenses
12,000
Total
P50,000
======
Advances for Operating Expenses
19901010
Cash-MDS, Regular
10104040
To recognize granting of cash advance
to field units without books of accounts
P50,000
Office Supplies Expenses

50203010
Traveling Expenses-Local
50201010
Water Expenses
50204010
Electricity Expenses
50204020
Telephone Expenses
50205020
Advances for Operating Expenses
19901010
To recognize liquidation of cash advance
upon receipt of the certified copies of CDReg
with paid DVs and other supporting documents
from field/extension/ satellite offices/operating units
P 10,000
15,000
8,000
5,000
12,000
P50,000
P 50,000
Cash Advances for Travel.

Section 2 of Executive Order (EO) No. 248 dated May 29, 1995, as amended by EO No. 248A
and EO No. 298 dated August 14, 1995 and March 23, 2004, respectively, provide that travels shall
cover only those that are urgent and extremely necessary, will involve the minimum expenditure and are
beneficial to the agency concerned and/or the country.
a. No government fund shall be utilized to defray foreign travel expenses of any government
official or employee, except in the case of training, seminar or conference abroad when the
officials or other personnel of the foreign mission cannot effectively represent the country
therein, and travels necessitated by international commitments; provided that no official or
employee, including uniformed personnel of the Department of the Interior and Local
Government (DILG) and Department of National Defense (DND) will be sent to foreign training,
conferences or attend international commitments when they are due to retire within one year
after the said foreign travel [Section 16(c) of Fiscal Year (FY) 2012 GAA or pertinent provisions
of the GAA for the Year]. Under Memorandum Circular No. 52 dated October 2, 2003 of the
Office of the President, the grant of clothing allowance in all categories of trips is suspended
indefinitely.
b. Officials and employees authorized to travel shall be granted cash advance to cover traveling
expenses. The amount to be granted shall be accounted as Advances to Officers and
Employees. No additional cash advance shall be granted to any official or employee unless the
previous cash advance given to him/her for travel is first liquidated and accounted for in the
books. For local travel, liquidation shall be done within a period of 30 days upon return to the
personnels workstation. On the other hand, cash advance for foreign travel shall be liquidated
within 60 days upon return to the Philippines. The Liquidation Report (LR) shall be prepared by
the officers/employees concerned and submitted to the Accounting Division/Unit with
appropriate SDs as basis for JEV preparation. The excess cash advance shall be refunded and an
OR shall be issued to acknowledge receipt thereof. In case the amount of cash advance is less
than the travel expenses incurred, the LR shall be submitted to liquidate the cash advance
previously granted and a DV shall be prepared to claim reimbursement of the deficiency in
amount.
The officers/employees who made the travel shall prepare the LR which shall be the basis for the
preparation of the JEV. The Accounting Division/Unit shall record the JEV in the GJ and maintain
SL/IP for officers and employees where the granting and liquidation of travel allowances shall be
posted for monitoring purposes
Illustrative Accounting Entries for the Granting and Liquidation of Advances to Officers and
Employees Covering Official Travel
Account Title
Account Code
Debit
Credit
Advances to Officers and Employees
19901040
Cash-M DS, Regular
10104040
To recognize granting of cash advance for local travel
to officers and employees based on duly approved
and paid DV, Authority to Travel and IT
P2,000
50201010
19901040
To recognize liquidation of cash advance for local
travel upon receipt of LR and supporting documents
P 2,000

19901040
Training Expenses
50202010
Cash-MDS, Regular
10104040
To recognize granting of cash advance for training abroad
P2,000
P 2,000
P 200,000
80,000
P 280,000
Traveling Expenses-Foreign
50201020
19901040
To recognize liquidation of cash advance for training
abroad upon receipt of LR and supporting documents.
P 200,000
P 200,000
The Report of Disbursement shall serve as the liquidation report of the cash advance granted to
the Disbursing Officer.
Petty Cash Fund(PCF) Another mode of disbursement and the fund shall be sufficient for emergency and petty expenses
of the agency. As such, all replenishment shall be directly charged to the appropriate expense
accounts and at all times, the PCF shall be equal to the total cash on hand and the unreplenished
expenses.
The PCF shall not be used to purchase regular inventory items for stock nor for the liquidation of
outstanding cash advances. It shall be used only for disbursements which cannot be conveniently
paid by check.
Disbursement through Petty Cash Fund
Shall be through the PC Voucher which shall be approved by authorized officials and signed by
the payee to acknowledge receipt of the amount from the PCCustodian. A DV shall be prepared to
replenish the fund.
At the end of the year, the PCC shall submit to the Accounting unit all outstanding PCVs. In
case the fund could not be replenished for lack of funds, a JEV shall be prepared to recognize all
unreplenished expenses in the books and the PCF account shall be credited. At the start of the year,
as soon as cash becomes available, the fund shall be replenished by a debit to account Petty Cash
Fund and credit to the appropriate Cash in Bank account to restore the fund to its original
amount.
In case the PCC resigns or ceases as the custodian of the fund, full accounting/liquidation shall
be made. Any excess cash shall be refunded and all the PCVs together with the original supporting
documents shall be surrendered to the Accounting Unit which shall prepare a JEV to take up the
expenses in the books and credit account Petty Cash Fund. In no case shall the remaining cash of
the former custodian be transferred to the incoming PCC.
The Petty Cash Fund record shall be used to record all the PCs received by the PCC as well as
reimbursements received for expenses paid. All PCV shall be supported with valid documents to prove
the propriety of disbursements, such as ORs, invoices, etc.
Illustrative Accounting Entries for Disbursements Out of Petty Cash
Account Title
Estimated Expenses:
Traveling Expenses
Postage and Courier Expenses
Fuel, Oil and Lubricants Expenses
Other MOOE
Account Code
P10,000
8,000
5,000
2,000
5,000
Debit
Credit
Total
P 30,000
======
Petty Cash
Cash-MDS, Regular
To record the establishment of PCF.
10101020
10104040
P 30,000
P 30,000
Traveling Expense-Local
50201010
50203010
Fuel, Oil and Lubricants
50203090
Postage and Courier Expenses
50205010
Other Maintenance and Operating Expenses
50299990
Cash-MDS, Regular
10104040
To record the replenishment of Petty Cash
based on the DV, RPPCVs and SDs
P 10,000
8,000
2,000
5,000
4,800
Cash-Collecting Officer
10101010
Petty Cash
10101020
To record return of unused PCF upon
retirement, resignation, separation and
termination of the Petty Cash Custodian
based on the OR
P 200
Assume the following are the unreplenished PCVs as at December 31:

Office Supplies
P 300
400
P 700
=====
50201010
50203010
Petty Cash
10101020
To record the unreplenished petty cash
at the end of the year.
P 29,800
P 200
P 300
400
P 700
Cash Advances for Petty Cash Fund of Government Units without Complete Set of Books of
Accounts.
Government Units without complete set of books of accounts may be granted cash advance
covering two months operating requirements for authorized petty and other miscellaneous expenses to
finance their operations. The cash advance shall be granted to the duly designated or appointed
Disbursing Officer
Accounting for Cash Shortage/Overage of Disbursing Officer.
Cash overage discovered by the Auditor that cannot be satisfactorily explained by the Disbursing
Officer shall be forfeited in favor of the government and an official receipt shall be issued by the
Collecting Officer or Cashier. The cash overage shall be taken up as Miscellaneous Income. Cash
shortage which is not restituted by the Disbursing Officer despite demand in writing by the Auditor shall
be taken up as receivable from the Disbursing Officer.
Illustrative Accounting Entries for Cash Overage/Shortage of Disbursing Officer
A. Cash Overage
Account Title
Account Code
Debit
Cash-Collecting Officers
10101010
Miscellaneous Income
40609990
To recognize forfeiture of cash overage
of the Disbursing Officer
xxx
Cash-Treasury/Agency Deposit, Regular

10104010
10101010
To recognize the remittance of forfeited
cash overage to the BTr
xxx
B.. Cash Shortage

Due from Officers and Employees
10305020
Advances for Operating Expenses/
19901010/
Advances for Payroll/
19901020/
Advances to Special Disbursing Officer 19901030
To recognize cash shortage of Disbursing Officer
10101010
10305020
To recognize restitution of cash shortage.
10104010
10101010
To recognize the remittance of restituted
cash shortage to the BTr
Credit
xxx
xxx
xxx
xxx
xxx
xxx
xxx
xxx
Accounting for Cancelled Checks.

Checks may be cancelled when they become stale, voided or spoiled. The depository bank
considers a check stale, if it has been outstanding for over six months from date of issue or as
prescribed.
A stale, voided or spoiled check shall be marked cancelled on its face and reported as follows:
a. Voided, spoiled or unclaimed stale checks with the Cashier shall be reported as cancelled in the
List of Unreleased Checks that will be attached to the RCI.
b. New checks may be issued for the replacement of stale/spoiled checks in the hands of the payees
or holders in due course, upon submission of the stale/spoiled checks to the Accounting
Division/Unit. A certified copy of the previously paid DVs shall be attached to the request for
replacement. A JEV shall be prepared to take up the cancellation. The replacement check shall
be reported in the RCI.
Illustrative Accounting Entries for Cancelled Checks
A. Cancellation and Replacement of Stale/Voided/Spoiled MDS check issued in the current year
Account Title
Account Code
Debit
Credit
Cash-MDS, Regular
Accounts Payable
10104040
20101010
xxx
xxx
To recognize the cancellation of

stale/voided/spoiled MDS checks.
Accounts Payable
Cash-MDS, Regular
To recognize the replacement of
stale/voided/spoiled MDS checks.
20101010
10104040
xxx
Cash- MDS, Regular

Appropriate Account
stale/voided/spoiled MDS checks
without Replacement
10104040
xxxxxxxx
xxx
xxx
xxx
B. Cancellation and Replacement of Stale/Voided/Spoiled MDS check issued in the prior year
Accumulated Surplus/(Deficit)
Accounts Payable
30101010
20101010
xxx
Accounts Payable
Cash-MDS, Regular
20101010
10104040
xxx
30101010
Appropriate Account
xxxxxxxx
without replacement
xxx
xxx
xxx
xxx
C..Cancellation and Replacement of Stale/Voided/Spoiled commercial check issued in the current and
prior year
Cash in Bank-LCCA
10102020
Accounts Payable
20101010
stale/voided/spoiled commercial checks
xxx
Accounts Payable
20101010
Cash in Bank-LCCA
10102020
stale/voided/spoiled commercial checks
xxx
xxx
30101010
xxx
Appropriate Account
xxxxxxxx
stale/voided/spoiled commercial checks without replacement.
Accounting for Disallowances.
xxx
xxx
Disallowances shall be taken up in the books of accounts only when they become final and
executory. The Accountant shall prepare the JEV to take up the Receivable-Disallowances/Charges
and credit the appropriate account for the current year or Accumulated Surplus/(Deficit) account if
pertaining to expenses of previous years.
Cash settlement of disallowances shall be acknowledged through the issue of an official receipt and
reported by the Cashier in the RCD.
Illustrative Accounting Entries for Disallowances
A. Recording of disallowances for current years transaction
Assume that the entity incurred overpayment of Office Supplies:
Amount paid P 100,000
Should be
90,000
Difference
P 10,000
Receivables-Disallowances/Charges
10305010
Office Supplies Expense
50203010
To recognize the overpayment of
purchased office supplies directly issued to end-user
P10,000
10101010
Receivables-Disallowances/Charges 10305010
To recognize the settlement of disallowance.
P10,000

10104010
10101010
To recognize the deposit of collection
P10,000
P10,000
P10,000
P10,000
B. Recording of disallowance for prior years transaction

10305010
30101010
To recognize the overpayment of
office supplies purchased during the prior year
P 10,000
10101010
10305010
To recognize the settlement of disallowance
P 10,000

10104010
10101010
P 10
P 10,000
P 10,000
P 10
Accounting for Overpayments.

Sometimes overpayments or even double payment of expenditures do happen in agencies. These
could be avoided with the institution of proper controls but some could not be avoided because of builtin procedures. One example is the payment of payrolls. Payrolls are prepared in advance and some
agencies pay their employees through the banking system. All these are done before reports of
attendance are submitted, making it impossible to know the exact amount to be paid in case there are
absences without pay during the pay periods. In case of overpayments, refunds shall be demanded of the
employees concerned.
Illustrative Accounting Entries for Overpayments
A Overpayment taken up as receivable

10305020
50101010
To recognize overpayment of salaries
and wages (When overpayment is ascertained)
xxx
To recognize receipt of refund
10101010
10305020
xxx

10104010
10101010
xxx
xxx
xxx
xxx
B. Refund of overpayment not taken up as receivable

10101010
50101010
To recognize receipt of refund of Salaries
and Wages-Regular during the current year
xxx

10104010
10101010
xxx
10101010
30101010
To recognize receipt of refund of
overpayment in the ensuing year
xxx

10104010
10101010
xxx
xxx
xxx
xxx
xxx
Advice to Debit Account (ADA) This is a system by which no check is issued to the payee in
payment of government obligations, but instead, the current account number of the payee in the bank
where the government maintains a deposit, shall be obtained by the accounting unit. If payment is to
be made, the ADA shall be issued by the Accounting Unit of the agency to the bank where it
maintains an account. All payments shall be made to the credit of the payees account and a debit to
the account maintained by the government agency in the same bank. A JEV shall be prepared to
record the transaction in the GJ.
Property and Inventory accounting System - consists of the system of monitoring, controlling
and recording of acquisition and disposal of property and inventory.
The system starts with the receipt of the purchases inventory items and equipment. The
requesting office need of the inventory items and equipment after determining that the items are not
available in stock shall prepare and cause the approval of the Purchase Request (PR). Based on the
approved PR and after accomplishing all the required procedures adopting a particular mode of
procurement, the agency shall issue a duly approved Purchase Order. Procedures relative to the
obligation of the purchase order and payment of the deliveries follow the procedures in the
obligation accounting system and disbursement system.
The sub-system are as follows:
1. Receipt, Inspection, Acceptance and Recording Deliveries of Inventory Items and
Equipment,
2. Requisition and Issuance of Inventory Items
3. Requisition and Issuance of Equipment
Perpetual Inventory Method purchase of supplies and materials for stock regardless of
whether or not they are consumed within the accounting period, shall be recorded as Inventory
account. Under the perpetual inventory method, an inventory control account is maintained in the
General Ledger on a current basis.
Regular purchases shall be recorded under the Inventory account and issuance thereof shall be
recorded based on the Report of Supplies and Materials Issued. Purchases out of Petty Cash Fund
shall be charged immediately to the appropriate expense accounts.
The accounting Unit shall maintain perpetual inventory records, such as the Supplies Ledger
Cards for each inventory stock, Property, Plant and Equipment Ledger Cards for each category of
plant, property and equipment including work and other animals, livestock, etc. The subsidiary
ledger cards shall contain the details of the General Ledger accounts.
For check and balance, the Property and Supply Officer/Unit shall maintain Property Cards (PC)
for property, plant and equipment, and Stock Cards (SC) and for inventories. The balance in
quantity per PC and SC should always reconcile with the ledger cards of the Accounting Unit.
The Moving Average Method of costing shall be used for costing inventories. This is a method
of calculating cost of inventory on the basis of weighted average on the date of issue. The
Accounting Unit shall be responsible in computing the cost of inventory on a regular basis.
Property, Plant and Equipment and Inventory Accounts acquired through purchase shall
include all costs incurred to bring them to the location necessary for their intended use, like
transportation cost, freight charges, installation costs, etc. These are recorded in the books of
accounts as Asset after inspection and acceptance of delivery.
During the construction period , property, plant and equipment shall be classified and recorded
as Construction in Progress with the appropriate asset classification. As soon as these are
completed, the Construction in Progress account shall be transferred to the appropriate asset
accounts.
ILLUSTRATIVE JOURNAL ENTRIES FROM SAMPLED TRANSACTION
A. NEDA paid the salaries of their employees. The following are the information taken from the
June15 payroll, salaries and wages and its mandatory deduction.
a) Salaries and wages regular
P 485,000
b) PERA
30,000
c) Withholding taxes
32,000
d)
Retirement and Life (GSIS)
40,000
e)
Pag-ibig premium
28,700
f)
PhilHealth premium
12,000
The agency paid their counterpart of the mandatory deductions. The agency contributed P 1,500
for ECC. Withholding taxes were remitted to BIR 2 weeks after end of the month.
Journalize the above transaction:
1.
Obligate the P515,000 salaries and wages for the month of June, 2015 and posted in the
Registry of Allotment, Obligation and Disbursement in the obligation column of PS.
2.
To record the expenses and establish the liabilities

50101010 Salaries and wages regular
485,000
50102020 PERA
30,000
20201010
Due to BIR
32,000
20201020
Due to GSIS
40,000
20201030
Due to Pag-ibig
28,700
20201040
Due to PhilHealth
12,000
20101020
402,300
3.
To record check issuance for ATM employees accounts.

20101020 Due to Officers and Employees 402,300
10104040
Cash-MDS-Regular
402,300
4.
5.
To record remittance of mandatory deductions.

20201010
Due to GSIS
40,000
20201030
Due to Pag-ibig
28,700
20201040
Due to PhilHealth
12,000
10104040
Cash- MDS, Regular
80,700
To obligate the government counterpart of the mandatory deductions, P92,200, recording

in the obligation column of the Registry.
6.
To record payment and remittance of the corresponding counterpart.

50103040
ECC Insurance Premiums
1,500
50103010
Ret. And Life Insurance Premium 50,000
50103020
Pag-ibig Contributions
28,700
50103030
PhilHealth Contribution
12,000
10104040
Cash MDS, Regular
92,200
7.
To record remittance to the BIR supported with the approved TRA from DBM.
20201010 Due to BIR
32,000
40301010
Subsidy from National Government
32,000
B. The Regional Director of NEDA 7 was directed to attend and Executive Committee Conference
in Manila NEDA Central Office. The travel was for 3 days but it was cut short due to an
emergency meeting at the regional office with the RDC 7. An itinerary of travel was prepared
showing the following information:
Transportation expenses (1st and last day) and other incidental
Expenses during the duration of the travel period. . . . . . . . . . . .
Per diem (1,200 x 3 days)
......................
Plane fare
...................
An amended itinerary was made and showed a reduction of the
Per diem equivalent to . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . .
P 1,600
3,600
5,000
1,500
Journalize the following travelling expenses transactions:

1.
2.
3.
Obligate and post P10,200 to the obligation column of the registry for MOOE.
To grant cash advance for the travel.
19901040 Advances to Officers and Employees
10104040
Cash MDS , Regular
Travelling expenses local

8,700
8,700
To record the refunded amount made upon return from travel.

10101010
19901040
5.
10,200
To recognize the actual travelling expenses and record liquidation of the

Cash advance.
50201010
19901040
4.
10,200
Cash collecting officer

1,500
1,500
To remit the refunded amount to the national treasury.

40301010
10101010
Cash treasury/Agency Deposit, Regular

1,500
1,500
6.
To adjust the obligation by posting a negative entry of P1,500 in the obligation Column
of the Registry. The obligation was 10,200 for travelling expenses but the actual travelling
expenses was only 8,700.
7.
For additional claim of travelling expenses maybe due to an extended official stay,
request for an obligation for the equivalent amount of the extended stay and it has to be
processed in the accounting office for payment/reimbursement. It has to be an official
travel duly supported with proper documentation.
If the travel is not fully supported, the auditor will disallow the claim upon post-audit of
said transaction.
C. Petty Cash Fund P10,000 was maintained by the agency under the imprest system. As of
December 31, 2014, the used petty cash supported with receipts amounting to P8,200 remained
unreplenished. The receipted use of PC consisted of the following expenses:
Office supplies expense
4,000
Repairs and maintenance OE 3,200
Other General Services
1,000
Record the transaction: 1) Granting of cash advance

2) Replenishment/liquidation of the expenses at the end of the
Accounting period.
3) Journal entry to be prepared at the beginning of the following year
considering the availability of funds, in order to return back
the balance of the PCF.
1.
2.
To obligate the PCF to be established amounting to P10,000 to be posted in the

obligation column of MOOE in the Registry of Allotment, Obligation and Disbursement.
Granting of PCF
10101020
10104040
3.
Petty Cash
Cash MDS, Regular
10,000
10,000
To record the unreplenished expenses and partially closing the equivalent petty cash
account.
50203010
Office supplies expenses
4,000
50213050
Repairs and Maintenance-Office Equipt
3,200
50212990
Other General Services
1,000
10101020
Petty Cash
8,200
( not obligated because the original PC was already obligated)
4.
Obligate the PC of P8,200 the following year to return the original petty cash of P10,00.
10101020
Petty Cash
8,200
10104040
Cash MDS, Regular
8,200
E, The agency process their 6 months requisition of office supplies amounting to P500,000. The
purchase was made to the Procurement Service of DBM, hence, no bidding was conducted, while
P150,000 purchase of equipment (2 air-conditioning units) was made to outside supplier or to SM
Appliance Center considering the lowest bid offer and no available stock in the Procurement
Service Office.. There is enough allotment balance in obligating the purchase. A week after the
delivery, P220,000 of office supplies were used in operation and recorded by the accountant
supported by MRSMI.
Purchase (Procurement Service)
1.
Obligate P500,000 and post under the obligation column in the registry for MOOE.
2.
To record advance payment of the purchase to the Procurement Service Office.

10303010
10104040
3.
500,000
500,000
To record acceptance of the delivery of office supplies.

10404010
10303010
4.
Due from NGAs

Cash MDS, Regular
Office supplies inventory

Due from NGAs
500,000
500,000
To record issues of office supplies to different requisitioner as per report.

50203010
10404010
Office supplies expense

Office supplies inventory
220,000
220,000
(Purchase ( Other Supplier)

1.
After the conduct of bidding/canvass, the purchase will be awarded to the lowest bidder/
supplier after a demo is being conducted and a Purchase Order is being prepared to be
signed by both the agency and supplier.
2.
Upon delivery of the equipment, obligate the amount, P150,000, for the purchase of
equipment to an outside supplier supported by the PO and posted to the registry under the
obligation column for MOOE.
3.
To record the delivery and acceptance of the delivered equipment.

10605020
20201010
20101010
4.
P150,000
6,250
143,750
To record payment of office equipment

20101010
10104040
5.
Office Equipment
Due to BIR
Accounts Payable
Accounts Payable
Cash MDS, Regular
143,750
143,750
To record remittance to BIR supported with approved TRA.

20201010
40301010
Due to BIR
6,250
Subsidy from National Government
6,250
( If the purchase was charged to a trust account and not come from an NCA when paid,
No obligation is necessary and payment shall be charged to the cash in bank- lcca account)
F. . The agency received their bills of the following:
PLDT
P 12,000
Water
5,000
Electricity
18,000
Rental (1 yr, 6/1/14-5/31/15) 24,000
Payment was made a month after it was processed.
Record the transaction.
1. Obligate the billed accounts and post under the obligation column of MOOE.
2. Record the bills
19902020
50205020
50204010
50204020
20101010
3.
Prepaid rent
24,000
Telephone expenses 12,000
Water expense
5,000
Electricity exp
18,000
Accounts Payable
To record the payment of the above bills.

20101010 Accounts Payable
20201010
Due to BIR
10104040
Cash MDS, Reg
59,000
59,000
3,235
55,765
4. To record remittance to BIR supported with approved TRA.

20201010 Due to BIR
3,235
40301010
Subsidy from National Government 3,235
G. The agency wanted to expand its building. The project was included in the approved budget
amounting to P7,500,000. It was awarded to a financially capable contractor and made to start
in May 15, 2014 to be finished four months after. However, constant rain caused the delay
in the completion, which made the agency charged a liquidating damages totalling P 55,000.
There were deficiencies noted during the inspection conducted when it was 35% completion and
claimed the payment of its first billing after being processed. The 2nd billing followed when it
was 60% completion and final billing when it was 100% completion..
Journalize the following transactions.
1. Obligate P7,500,000, construction of an expansion and post in the obligation column of the
registry for CO.
2. To record receipt of cash from the contractor paid as performance bond (cash bond 5%).
10101010
375,000
20401040
Guaranty/Security Deposits Payable
375,000
3. To record the temporary deposit of the performance bond to the National Treasury.
10104010
Cash Treasury/Agency Deposit Regular 375,000
10101010
375,000
4. To record the 15% of the contract amount as advances to contractor.
19902010
10104040
Advances to Contractors
Cash MDS, Regular
(P7,500,000 x 15% = 1,125,000)
1,125,000
1,125,000
5. To record the 1st progress billing, 35% completion.

10610030
20101010
19902010
Construction in Progress Building and

Other Structures
Accounts Payable
2,625,000
2,231,250
393,750
6. To record payment of the 1st billing;

20101010
10104040
20401040
20201010
Accounts Payable
2,231,250
Cash MDS, Regular
Guaranty/Security and Deposit Payable
Due to BIR
1,736,625
262,500
232,125
7. To record the receipt of the 2nd billing:

10610030
20101010
19902010
Construction in Progress-Building
And Other structures
Accounts Payable
2,250,000
1,912,500
337,500
8. To record payment of the 2nd billing

20101010
10104040
20401040
20201010
Accounts Payable
Cash-MDS, Regular
Guaranty/Security and Dep Payable
Due to BIR
1,912,500
1,489,250
225,000
198,250
9. To record the receipt of the final billing:

(cost 7,500,000 - LD 55,000 Advances 393,750)
10610030 Construction in Progress Building
And Other Structures
20101010
Accounts Payable
19902010
Advances to contractor
2,570,000
2,176,300
393,700
10. To adjust obligation by negative entry in the obligation column of the Registry for CO
Reducing the original amount by P55,000 due to liquidating damages.
11. To record final payment:
20101010
10104040
20401040
20201010
Accounts Payable
Cash-MDS, Regular
Guaranty/Security and Dep Payable
Due to BIR
2,176,300
1,692,350
262,500
221,450
12. To record the turn-over and acceptance of the building extension:

Contract amount
Less: Liquidating damages
Net cost
10604010
10610030
P7,500,000
55,000
P7,445,000
========
Building
Construction in Progress Building
And Other Structures
7,445,000
7,445,000
13. Constructive Receipt of NCA for TRA

Cash-Tax Remittance Advice
10104070
Subsidy from National Government 40301010
To recognize constructive receipt
of NCA for TRA
P 651,825
P 651,825
14..To record remittance of withholding taxes thru TRA.

20201010
10104070
Due to BIR
P651,825
P 651,825
13. To record receipt of NCA for deposited performance bond.

10104040
20401040
Cash MDS, Regular

375,000
375,000
14. To record release of performance bond:

20401040
10104040
Cash MDS, Regular
375,000
15. Refund of retention fees to contractor:

20401040
10104040
Cash MDS, Regular
750,000
375,000
750,000
Illustrative Accounting Entries for Remittance of Taxes Withheld through TRA

Particulars
Account Code
Debit
Credit
A. Agency Books
1. Constructive Receipt of NCA for TRA
10104070
Subsidy from National Government 40301010
of NCA for TRA
P 5,000
P 5,000
2Remittance of taxes withheld through TRA

Due to BIR
20201010
10104070
To recognize remittance of taxes
withheld through TRA
P 5,000
P 5,000
B. BIR Books
1. Constructive Receipt of Tax Revenue through TRA from the NGAs
10104070
Income Tax
40101010
of tax revenue based on the TRA received
from the agency
P 5,000
P 5,000
C. BTr Books
1. Constructive Utilization of NCA for TRA by the remitting NGAs
Subsidy to NGAs
50214010
10104070
To recognize remittance of taxes withheld
by the agency based on the TRA received.
P 5,000
P 5,000
Depreciation.
PPE gradually loses its ability to provide service over the course of time. Because of this, its cost
needs to be distributed on a systematic basis over its useful life. The allocated cost is referred to as
depreciation. The depreciation charge for each period shall be recognized as expense unless it is
included in the carrying amount of another asset. For example, the depreciation of manufacturing plant
and equipment is included in the costs of conversion of inventories. Similarly, depreciation of PPE used
for development activities may be included in the cost of an intangible asset recognized.
The following are policies regarding depreciation of PPE:
a. There are three factors an entity must consider in determining depreciation:
1. Initial cost,
2. Useful life, and
3. Expected residual value at the end of its useful life.
b. Except for land and not recognized heritage assets, all PPE shall be depreciated.
c..Depreciation of an asset begins when it is available for use such as when it is in the location
and condition necessary for it to be capable of operating in the manner intended by
management. For simplicity and to avoid proportionate computation, depreciation shall be

for one month if the PPE is available for use on or before the 15th of the month. However,
if the PPE is available for use after the 15th of the month, depreciation shall be for the
succeeding month.
d.. Depreciation of an asset ceases when the asset is derecognized. Therefore, depreciation does not
cease when the asset becomes idle or is retired from active use and held for disposal unless the asset
is fully depreciated.
e..A residual value equivalent to at least five percent (5%) of the cost shall be adopted unless
a more appropriate percentage is determined by the entity based on its operation subject to
the approval of COA. Generally, infrastructure assets have no residual value. In case, the
residual value of parts of the infrastructure assets can be determined, the policy of at least
five percent (5%) of the cost of that part shall be applied.
f. The computation of monthly depreciation expense shall be as follows:
Depreciation Expense =
Cost Residual Value

Estimated Useful Life (in months)
l. Depreciation shall be recognized as a debit to the Depreciation Expense account and a credit to
the Accumulated Depreciation account. Accumulated Depreciation is a contra-asset account
presented in the FS as deduction from the related asset account. Depreciation expense shall be
recognized on a monthly basis.
Example: On June 5, 2014, an office equipment was purchased at P22,000 and has an estimated
useful life of 5 years and 5% residual value. Said equipment was available for use on
June 20, 2014.
Monthly Depreciation =
P 22,000 P 1,100 =
60 months
The accounting entry shall be as follows:

Account Title
June 30, 2014
No depreciation expense recognized.
July 31, 2014
P348.33
Account Code
Debit
Credit
Depreciation-Machinery and Equipment

Accumulated Depreciation-Office
Equipment
To recognize depreciation for the
month of July 2014.
50501050
10605021
P 348.33
P 348.33

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REVISED CHART OF ACCOUNTS UNDER THE NGAS

COA Revised Chart of Accounts ACCOUNT CODE STRUCTURE

Any clarification or request for assistance shall be directed to the Government

Analyze balances as of December 31, 2013

Specific Accounting Policies and Guidelines

Maintenance of NG books shall be discontinued. . A separate set of books shall be

The Philippine Public Sector Accounting Standards (PPSAS)

Sector Standards (PPSAS).

Relevant factors, including best accounting practices, and

PPSAS 4 The Effects of Changes in Foreign Exchange Rates

PPSAS 9 - Revenue from Exchange Transactions

1. Lease is classified as a Finance lease if:

PPSAS 17 Property, Plant and Equipment

A reliable estimate cannot be made.

PPSAS 19 Provisions, Contingent Liabilities and Contingent Assets

Related party transactions; and

PPSAS 26 Impairment of Cash Generating Assets

PPSAS 28 Financial Instruments Presentation

Responsibility, Accountability and Liability over Government Funds and Property

ACCOUNTING FOR DISBURSEMENTS AND RELATED TRANSACTIONS

Salaries and wages

2. Maintenance and Other Operating Expenses

Certification of Availability of Funds.

Prohibition against the Incurrence of Overdraft.

d. Region or locality of use;

Certified copies of official receipts and bills

c..Disallowances pertaining to expenses incurred

Certified copies of official receipts and bills,

Modes of disbursement in the government:

e..Only permanently appointed officials shall be designated as disbursing officers;

2. Granting of Advances for Payroll

Office Supplies Expenses

Cash Advances for Travel.

Advances to Officers and Employees

Assume the following are the unreplenished PCVs as at December 31:

Cash-Treasury/Agency Deposit, Regular

B.. Cash Shortage

Accounting for Cancelled Checks.

To recognize the cancellation of

Cash- MDS, Regular

Cash-Treasury/Agency Deposit, Regular

B. Recording of disallowance for prior years transaction

Cash-Treasury/Agency Deposit, Regular

Accounting for Overpayments.

Due from Officers and Employees

Cash-Treasury/Agency Deposit, Regular

B. Refund of overpayment not taken up as receivable

Cash-Treasury/Agency Deposit, Regular

Cash-Treasury/Agency Deposit, Regular

To record the expenses and establish the liabilities

To record check issuance for ATM employees accounts.

To record remittance of mandatory deductions.

To obligate the government counterpart of the mandatory deductions, P92,200, recording

To record payment and remittance of the corresponding counterpart.

Journalize the following travelling expenses transactions:

Travelling expenses local

To record the refunded amount made upon return from travel.

To recognize the actual travelling expenses and record liquidation of the

Cash collecting officer

To remit the refunded amount to the national treasury.

Cash treasury/Agency Deposit, Regular

Record the transaction: 1) Granting of cash advance