PAGBA Convention, Sarabia Manor Hotel, Iloilo City
April 5, 2013
1

A.
Introduction
 What is Public Financial Management (PFM)?
 PFM System Weaknesses
 Overview of PFM Reform Roadmap
B.
Budget Reporting and Performance Standards
Project
 Key PFM Reform Projects
 Meaning and Purpose of Unified Accounts Code
Structure (UACS)
 Key Elements of the UACs
2

Public Financial Management (PFM) is a system of rules, procedures and practices for government to manage public finances in the areas of:
 budgeting
 accounting
 auditing
 cash management
 management of public debt
 revenue generation
 public reporting on public sector financial operations
3

PFM Gaps in the Budget Process
PREPARATION
ACCOUNTABILITY
messy traffic of documents
lack of budget credibility
budget not results based
lack of funding predictability
weak oversight of Congress and monitoring of contingent
liabilities
EXECUTION
AUTHORIZATION
4

STRATEGIES
Lack of a common classification system for budgeting, accounting, auditing and cash management
Consolidated FM reporting requirements based on harmonized classification of all accounts
Real-time reports, access to financial data and control of obligations and disbursements for more effective financial control and accountability
Harmonize budgetary and accounting classifications and reporting
Codify PFM rules and complete PFM Rules
Manual for capacity building
Identify common reporting requirements of oversight agencies and line departments
Revise New Government Accounting System
(NGAS) Manual and chart of accounts
Facilitate the development of GIFMIS
DESIRED
RESULTS
5

This is now…
In the long run, the Philippine PFM needs this kind of information system
6

 Master plan for modernizing the financial management system of the government
 Executive Order 55 (s. 2011) directing the integration and automation of PFM systems:
 Government Integrated
Financial Management
Information System (GIFMIS)
 Treasury Single Account (TSA)
 Efficient Budget Release
System
 Systematic Financial and
Physical Reporting and Au diting
7

Budget Reporting and Performance
Standards Project
Objectives
• Harmonize and consolidate data structures and apply consistent set of budget and accounting rules for reporting
• Generate real-time reports on budget utilization and financial performance through GIFMIS (long term)
• Consolidated and agency level budget execution and budget utilization reports published in COA and DBM websites
Key Activities
• Formulation of Unified Accounts Code Structure to harmonize budgetary classifications and chart of accounts
• Harmonized DBM and COA financial reporting forms
• Formulation of performance standards initially with restructuring of programs/activities/projects (NBC 532) and issuance of OPIF Reference
Guide
• Glossary of PFM Terminologies

Debt Mgmt
(DMFAS)
UACS
Securities
Management
UACS
UACS
Auditing Mgmt
(IRRBAS)
Accounting &
Fiscal Reporting
Cash
Management
Asset
Management
Fiscal Simulation
Budget
Preparation
Budget
Management
UACS
UACS
UACS
Government EIS
(GEIS)
Procurement
(PhilGEPS)
Business
Intelligence
Data
Warehousing
Budget Execution
GIFMIS
Portal
User
Vendor/
Supplier Creditor
Public
Employee
Commitment
Management
Payments
Management
UACS
Receipts
Management
Central Bank
&
Government
Servicing
Banks
(TSA)
Commercial
Banks
UACS
Human Resources Management
Plantilla
(GMIS)
Payroll
(NPS)
UACS
Revenue Management
Internal
Revenue (BIR)
Customs
(BOC)
UACS
9

10

11

 Enable reporting of actual revenue collections and expenditures against programmed revenues and expenditures
 Enable the comparison of:
 allotment releases vs. appropriations,
 obligations vs. releases, and
 actual disbursements vs. obligations for programs/projects/activities of spending agencies
12

Contains the accounts and codes to be adopted in:
 identifying
 aggregating
 budgeting
 accounting
 auditing, and
 reporting the financial transactions of the government
13

 Financial reports as required by the Department of
Budget and Management and the Commission on
Audit;
 Financial Statements as required by the Public Sector
Accounting Standards Board of the Philippines;
 Management reports as required by heads of departments/agencies; and
 Economic Statistics consistent with the Government
Finance Statistics Manual 2001
14

15

16

Financing
Source
1 digit
1 st
Funding Source
6 Digits
Authorization
2 digits
2 nd & 3 rd
Fund
Category
3 digits
4 th to 6 th
17

18

19

Funding Source: Fund Category
Particulars
Specific Budgets of National Government Agencies
GoP Counterpart Funds and Loans/Grants from
Multilateral and Bilateral Institutions
Allocations to Local Government Units
Budgetary Support to Government Corporations
Financial Assistance to Metro Manila Development
Authority
Special Accounts in the General Fund
Special Purpose Funds
Unprogrammed Funds
Retained Income/Funds
Revolving Funds
Trust Receipts
Others (Specify)
Codes
Old
101
UACS
101 to 150
102/171 151 to 250
103
104
251 to 275
276 to 300
301-320
105,183,401,
151 to 159 321 to 400
401 to 420
421 to 440
441 to 500
161 to 164 501 to 600
101-184, 187 601 to 610
611 to 999
20

Particulars
General Fund
New General Appropriation
Agency Specific Budget
Misc. Personnel Ben Fund
Financing Autho
Fund
Cat
=
Funding
Source
Code
1
01
101 1 01 101
406 1 01 406
Automatic Appropriation
RLIP
Special Account in the Gen.
Fund
DPWH-Special Road Support
Fund
04
102 1 04 102
346 1 04 346
21

22

Department
– the primary subdivision of the Executive Branch responsible for the overall management of a sector or a permanent national concern with nationwide or international impact
– headed by a Secretary or an official with an equivalent position level
 For purposes of the UACs, Constitutional Offices, the Judiciary and the Legislature are categorized as Department-level entities.
Agency
– refers to any of the various units of the Government, including an office, instrumentality, or GOCC, that may not approximate size of a
Department but which nevertheless performs tasks that are important and whose area of concern is nationwide in scope
23

Lower-Level Operating Unit
- organizational entities charged with carrying out specific substantive functions or with directly implementing programs/projects of a department or agency, such as line bureaus, field units
24

Organization Code
12 Digits
DEPARTMENT
2 digits
AGENCY
3 digits
LOWER-LEVEL
OPERATING
UNIT
7 digits
25

DEPARTMENT
Congress of The Philippines
Office of The President
Office of The Vice-President
Department of Agrarian Reform
Department of Agriculture
Department of Budget and Management
Department of Education
State Universities and Colleges
Department of Energy
UACS
01
02
03
04
05
06
07
08
09
26

DEPARTMENT
Department of Environment and Natural Resources
Department of Finance
Department of Foreign Affairs
Department of Health
Department of the Interior and Local Government
Department of Justice
Department of Labor and Employment
Budgetary Support to Government Corporations
Financial Assistance to Metropolitan Manila
Development Authority
UACS
10
11
12
13
14
15
16
35
36
27

DEPARTMENT/AGENCY
Department of Budget and Management
Office of the Secretary
Government Procurement Policy
Board-Technical Support Office
UACS
06 000 0000000
06 001 0000000
06 002 0000000
28

DEPARTMENT/AGENCY/OPERATING
UNIT
Department of Budget and Management
Office of the Secretary
Central Office
Regional Office – I
Regional Office – NCR
Regional Office – CAR
Regional Office - II
Regional Office - III
Government Procurement Policy Board-
Technical Support Office
UACS
06 000 0000000
06 001 0000000
06 001 01 00000
06 001 03 00001
06 001 03 00013
06 001 03 00014
06 001 03 00002
06 001 03 00003
06 002 0000000
29

Examples of Operating Units
Classification
LOWER-LEVEL OPERATING UNITS CLASSIFICATION UACS
Central Office
Staff Bureaus
Regional Offices/Centers for Health Development
Sub-Agency
Provincial Offices
National Irrigation Administration Offices
Schools Division/District Offices
Secondary Schools
Revenue Regional Offices
District Engineering Offices and Sub District
Engineering Offices
04
05
06
01
02
03
08
09
11
18
30

Sample Organization Code
06 001 03 00000
12 Digits
DEPARTMENT
OLD  DBM
UACS  06
(2 digits)
AGENCY
OLD  OSEC-DBM
UACS  001
(3 digits)
LOWER-LEVEL OPERATING
UNIT
OLD  Central Office(Activity)
UACS  03 00000
(7 digits)
31

DEPARTMENT
From:
Department of
Education
07
To:
Department of
Trade and
Industry
22
AGENCY
LOWER
LEVEL
OPERATING
UNIT
National Book
Development
Board (NBDB)
002
National Book
Development
Board
007
0000000
0000000
UACS
07 002
0000000
22 007
0000000
32

DEPARTMENT OF TRADE AND INDUSTRY
22 000 00 00000
Office of the Secretary
Board of Investments
22 001 00
22 002 00
00000
00000
Construction Industry Authority of the Philippines 22 003 00 00000
Construction Manpower Development Foundation 22 004 00 00000
Philippine Trade Training Center
Product Development and Design Center of the
Philippines
National Book Development Board
22 005 00 00000
22 006 00
22 007 00
00000
00000
33

34

Region
2 digits
Location Code
9 Digits
Province
2 digits
City/
Municipality
2 digits
Barangay
3 digits
35

REGION
Region I – Ilocos
Region II – Cagayan Valley
Region III – Central Luzon
Region IV-A – CALABARZON
Region IV-B – MIMAROPA
Region V – Bicol
Region VI – Western Visayas
Region VII – Central Visayas
Region VIII – Eastern Visayas
Region IX – Zamboanga Peninsula
Region X – Northern Mindanao
Region XI – Davao
Region XII – SOCSKSARGEN
Region XIII – CARAGA
National Capital Region
Cordillera Administrative Region
Autonomous Region in Muslim Mindanao
UACS
10
11
12
16
06
07
08
09
13
14
15
01
02
03
04
17
05
36

PROVINCE
CAR - Cordillera Administrative
Region
Abra
Apayao
Benguet
Ifugao
Kalinga
Mountain Province
UACS
01
81
11
27
32
44
37

MUNICIPALITY
CAR - Cordillera Administrative
Region
Abra
Bangued
UACS
140000000
140100000
14 0101 000
38

39

40

Program
1 st digit
Project
MFO/PAP Code
9 Digits
MFO
Activity Code
2 nd – and 3 rd digits
Project Category
1 st Level
4 th - and 5 th digits
Sub-Category
2 nd Level
6 th – to 9 th digits
Project Title
1 st digit 2 nd – and 3 rd digits 4 th - and 5 th digits
Activity Code
6 th – to 9 th digits
Purpose (SPF)
1 st digit 2 nd – and 3 rd digits 4 th - and 5 th digits 6 th – to 9 th digits
41

Programs, Projects or Purpose
General Administration and Support
(GAS)
Support to Operations (STO)
Operations
Locally-Funded Projects
Foreign-Assisted Projects
Purpose
UACS
1
4
5
2
3
6
42

Physical Infrastructure Projects
Includes Buildings, Flood Control, Roads and Bridges,
Other Transport Infrastructure, Water Management and
Power and Communications Infrastructure
Non Physical Infrastructure Projects
Includes Economic Development, Education, Environmental
Protection, Governance, Health, Recreation Sports and
Culture, Research and Development and Social
Protection
43

Governance
General Public Services
Defense
1000
1001
1002
Public Order and Safety
Systems Development
Capacity Development
1003
1004
1005
Governance and Accountability Improvement 1006
44

45

46

47

48

49

50

Object Code
10 Digits
COA
Chart of Accounts
Object
8 digits
Sub-Object
2 digits
51

 Substantially revised to consolidate some line items, add clarity to overall structure and to facilitate compliance with the Philippine Public Sector Accounting Standards (PPSAS)
 Moved away from the 3-digit coding framework (2003) to an
8-digit framework (2012)
Description
Assets
Liabilities
Equity
Income
Expenses
CoA
1
2
3
4
5
52

 Every item on the COA CoA included
 Sub codes added to meet DBM, BTr, DoF,
COA and GFS reporting requirements
 Capital Outlay codes added in correspondence with relevant COA CoA asset codes
 Some Lump Sum codes added for use prior to transfer to Departments
53

5
5
5 Expenses
5 01 Personnel Services
5 01 01 Salaries and Wages
5 01 01 010 Salaries and Wages - Regular
5 01 01 020 Salaries and Wages - Casual/Contractual
5 01 02 Other Compensation
5 01 02 010 Personal Economic Relief Allowance (PERA)
5 01 02 020 Representation Allowance
5 01 02 030 Transportation Allowance
5 01 02 040 Clothing/Uniform Allowance
5 01 02 050 Subsistence Allowance
5 01 02 060 Laundry Allowance
5 01 02 070 Quarters Allowance
5 01 02 080 Productivity Incentive Allowance
5 01 02 090 Overseas Allowance
5 01 02 100 Honoraria
5 01 02 110 Hazard Pay
5 01 02 120 Longevity Pay
5 01 02 130 Overtime and Night Pay
5 01
01
01
02 140
02 150
02 990
Year End Bonus
Cash Gift
Other Bonuses and Allowances
54

EXPENSES
PERSONNEL SERVICES
Salaries and Wages
Salaries and Wages – Regular
Basic Salary – Civilian
Base Pay - Military/Uniformed Personnel
Salaries and Wages - Casual/Contractual
Other Personnel Benefits
Pension Benefits
Pension Benefits - Civilian
Pension Benefits – Military/Uniformed Personnel
Other Personnel Benefits
Lump-sum for Creation of New Positions - Civilian
Lump-sum for Creation of New Positions - Military/Uniformed
Personnel
Lump-sum for Reclassification of Positions
50000000 00
50100000 00
50101000 00
50101010 00
50101010 01
50101010 02
50101020 00
50104990 00
50104010 00
50104010 01
50104010 02
50104990 00
50104990 01
50104990 02
50104990 03
55

CAPITAL OUTLAYS
Investment Outlay
Investment in Corporations and Subsidiaries Outlay
Investment in Government - Owned/Controlled Corporations
Investment in Subsidiaries Outlay
Loans Outlay
Loans Outlay – GOCCs
Loans Outlay – Others
Investment Property Outlay
Investment Property – Land
Investment Property - Buildings
Property, Plant and Equipment Outlay
Land Outlay
Land Improvements Outlay
Land Improvements - Aquaculture Structures
Reforestation Projects Outlay
Other Land Improvements
50600000
50601000
50601010
50601010
50601010
50601020
50601020
50601020
50601030
50601030
50601030
50602000
50602010
50602020
50602020
50602020
50602020
00
01
02
00
01
00
00
00
01
02
00
01
02
02
00
00
03
56

www.pfm.gov.ph
57

Objective
• Facilitate the physical development of a GIFMIS solution that can collect and organize financial information in a central database
• GIFMIS is an integrated web-based application to enable agencies to generate real-time, reliable and accurate financial reports
Key Activities
• Development of the National Payroll System (NPS) and payroll-related
Government Human Resource Information System (GHRIS)
• Conceptual Design of GIFMIS
• Development of the Online Submission of Budget Proposal
• Enhancement of the eBudget Preparation Management System