Republic of the Philippines
COMMISSION ON AUDIT
Commonwealth Avenue, Quezon City, Philippines
GOVERNMENT ACCOUNTING AND FMIS
CIRCULAR LETTER
TO
No. :
Date:
2003-005
November 21, 2003
: Heads of Departments, Agencies, Bureaus and Offices of the National
Government; Heads of Self-Governing Boards and Commissions, State
Universities and Colleges; Heads of Financial Management Services, Chief
Accountants/Heads of Accounting Units; COA Directors, Auditors; and All
Others Concerned.
SUBJECT : Accounting Guidelines and Procedures on Collection and Deposit of Grants
and Donations
1.0
PURPOSE
This Circular Letter is issued to provide accounting guidelines and procedures on
collection, deposit and utilization of income from grants and donations of National
Government Agencies (NGAs) under the New Government Accounting System
(NGAS).
2.0
POLICIES, GUIDELINES AND PROCEDURES
2.1
All income from grants and donations shall be receipted by national government
agencies and remitted to the National Treasury pursuant to Section 12 of the
General Provisions, Republic Act No. 9206, the General Appropriations Act of
2003, unless it is authorized by the donor/grantor that the same shall be
deposited with Authorized Government Depository Bank (AGDB).
2.2
Receipt and remittance to the National Treasury of grants and donations shall
be recorded in the National Government (NG) Books, while those authorized to
be deposited with AGDB shall be recorded in the Regular Agency (RA) Books.
2.3
Utilization of grants and donations remitted to the National Treasury shall be
recorded in the RA Books.
2.4
Account "Income from Grants and Donations" shall be used to record receipt of
the grants/donations whether to be remitted to the National Treasury or
deposited to AGDB.
3.0
SPECIFIC GUIDELINES AND PROCEDURES
3.1
Grants and donations remitted to the National Treasury
3.1.1 The receipt and remittance to the National Treasury of the grants and
donations shall be entered in the Cash Receipts Record and included in
the Report of Collections and Deposit (RCD) maintained/prepared by the
Cashier/Collecting Officer. Based on the RCD, these shall be recorded by
the Accounting Unit in the Cash Journal (CJ) by crediting and debiting
account "Income from Grants and Donations" for collection and
remittance, respectively. The same account shall be indicated in the List
of Collections attached to the Deposit Slip, upon remittance.
3.1.2 Special Allotment Receipt Order (SARO) and Notice of Cash Allocation
(NCA) shall be requested by the recipient agency from the Department of
Budget and Management before utilization of the grants and donation.
3.1.3 The allotment received per SARO shall be recorded in the appropriate
RAOs under the RA Books.
3.1.4 The receipt of NCA shall be recorded in the RA books as credit to
"Subsidy Income from National Government".
3.1.5 The income from grants and donation shall be included in the Report of
Income prepared and submitted to the Commission on Audit and
Department of Budget and Management, and other fiscal agencies in
accordance with existing regulations.
3.1.6 For utilization of the grants, Allotment and Obligation Slips (ALOBS) shall
be prepared, supported by duly approved Purchase Order, Job Order or
Disbursements Vouchers (DVs), as the case may be.
3.1.7 Payments of obligation shall be thru the issuance of Modified
Disbursement System (MDS) Checks.
3.2
Grants and donations deposited with AGDB
3.2.1 The grants and donations received and authorized to be deposited with
AGDB shall be entered in the Cash Receipts Record of the
Cashier/Collecting Officer, and shall be included in the Report of
Collections and Deposits to be submitted to the Accounting Unit for
recording in the Cash Receipts Journal (CRJ).
3.2.2 A Special Budget shall be prepared in accordance with the Memorandum
of Agreement or Deed of Donation for approval of Head of the Agency or
its approving body. The approved Special Budget shall be entered in the
Registry of Budgetted Income and Utilization (RBIU) attached as Annex A.
3.2.3 Charges or utilization of the fund shall be made thru the issuance of
commercial checks based on duly approved DVs.
3.2.4 The amount of charge/expense shall be entered in RBIU by the assigned
personnel in the Accounting Unit prior to signing of the certification by the
Head of the Accounting Unit as to propriety and completeness of
supporting documents and availability of cash under Box B of the DV.
3.2.5 Unutilized portion of the approved budget shall be forwarded as beginning
balances in the RBIU of the succeeding years as provided in the Special
Budget.
4.0
ACCOUNTING ENTRIES
The illustrative accounting entries pertinent to the collection and use of grants and
donations are shown in the following annexes:
Annex B – NG books Collections and Deposits
Annex C – RA books Collections, Deposits and Utilization.
5.0
SAVING CLAUSE
Cases not covered in this Circular shall be referred to the Government Accounting
and FMIS, this Commission, for resolution.
6.0
EFFECTIVITY
This circular shall take effect immediately.
ANNEXES:
- 24KB;
- 36KB
Annex A - Registry of Budgetted Income and Utilization (RBIU)
- Instructions
- 13KB;
- 16KB
- 29KB
Annex B - Illustrative Accounting Entries - NG Books
Collections and Deposits
- 16KB;
- 24KB
Annex C - Illustrative Accounting Entries - RA Books
Collections, Deposits and Utilization
- 12KB;
- 20KB