Guidelines for the Depository Account of LGUs, BIR, BOC, Attached Agencies of the Department of Finance, and GOCCs

June 8, 1999 BLGF MEMORANDUM CIRCULAR NO. 010-99 TO : All BLGF Officials and Personnel; Regional Directors for Local Government Finance; District Treasurers of Metropolitan Manila; Provincial, City and Municipal Treasurers and Others Concerned SUBJECT : Guidelines for the Depository Account of Local Government Units (LGUs), Bureau of Internal Revenue (BIR), Bureau of Customs (BOC), Attached Agencies of the Department of Finance (DOF), and Government Owned and/or Controlled Corporations (GOCCs) For the information and guidance of all concerned, attached is a copy of Department Order No. 11-99, dated February 24, 1999, of the Secretary of Finance which supersedes Department Order No. 56-98 dated August 14, 1999 directing all its attached agencies to deposit their funds and maintain depository accounts with any of the government financial institutions nearest their location namely: Land Bank of the Philippines (LBP) and Development Bank of the Philippines (DBP), embodied in the letters dated September 11, 1998 of this Office to all BLGF Regional Directors, and adding the Philippine National Bank (PNB) and Philippine Postal Savings Bank (PSSB) to the two (2) aforesaid government units and DOF attached agencies disseminated under BLGF Memorandum Circular No. 02-99, dated January 26, 1999, of this Office. llcd Strict observance and compliance with the provisions of said Department Order No. 11-99 are hereby enjoined. Failure to comply with subject Department Order shall subject the responsible officials and/or employees to appropriate criminal and/or administrative action pursuant to Item 3.0 thereof. The District Treasurers of Metropolitan Manila and all Provincial Treasurers are hereby instructed to disseminate the contents of this Circular, including the attachments, to all Municipal Treasurers within their respective jurisdictions. (SGD.) ANGELINA M. MAGSINO Deputy Executive Director Officer-in-Charge February 24, 1999 DEPARTMENT ORDER NO. 11-99 TO : ALL PROVINCIAL, CITY AND MUNICIPAL TREASURERS, THE COMMISSIONERS OF BUREAU OF INTERNAL REVENUE, AND BUREAU OF CUSTOMS, HEADS OF ALL ATTACHED AGENCIES OF THE DEPARTMENT OF FINANCE, AND HEADS OF ALL GOVERNMENT AND/OR CONTROLLED CORPORATIONS SUBJECT : Guidelines for the Depository Accounts for Local Government Units (LGUs), Bureau of Internal Revenue (BIR), Bureau of Customs (BOC), attached agencies of the Department of Finance (DOF), and Government Owned and/or Controlled Corporations (GOCCs) 1.0 PURPOSE This Order is issued to direct the LGUs, BIR, BOC, attached agencies of the DOF and GOCCs to deposit their funds to the appropriate financial institutions in congruence with the Bangko Sentral ng Pilipinas (BSP) Circular 110, Series of 1996 with particular attention to Sections 2 to 5. The Circular provides for the guidelines governing the acceptance by banks of deposits of the Government, its political subdivisions and instrumentalities, as well as of GOCCs. This issuance shall supersede DOF Order No. 56-98 dated August 14, 1998 and subsequent DOF Memo dated December 21, 1998 . 2.0 GENERAL GUIDELINES 2.1 As part of this Department's efforts to strengthen the fiscal position of the Government, the LGUs, BIR, BOC, attached agencies of the DOF and GOCCs shall deposit their funds and maintain depository accounts preferably with any of the Government Financial Institutions (GFIs) namely; the Land Bank of the Philippines (LBP) and the Development Bank of the Philippines (LBP) nearest to their location. 2.2 By way of exception, the LGUs, BIR, BOC, and attached agencies of the DOF and GOCCs may deposit and maintain their cash balances with the Philippine National Bank, (PNB) pursuant to Monetary Board (MB) Resolution No. 1233 dated August 26, 1998 and with the Philippine Postal Savings Bank (PPSB), in addition to the two GFIs earlier mentioned. 2.3 No government funds shall be deposited to any other private banking institutions with the further exception of rural and cooperative banks authorized by the BSP to act as depository of government funds pursuant to Section 5(2) of BSP Circular 110, provided that: 2.3.1 A one (1) year phase-out period shall be given to LGUs, BIR, BOC, and attached agencies of the DOF and GOCCs to transfer and maintain their deposits and cash balances from authorized rural and cooperative banks with any of the following banks namely: LBP, DBP, PNB, and PPSB. Deposits and cash balances with rural and cooperative banks without prior authorization from BSP to act as depository of government funds pursuant to Section 5(2) of BSP Circular 110, shall be immediately transferred to any of the identified authorized banks under this section; and provided further that, 2.3.2 In exceptional cases where there are no accessible LBP, DBP, PNB, and PPSB branches within their respective vicinities, LGUs, BIR, BOC, and attached agencies of the DOF and GOCCs may be allowed to deposit and maintain their cash balances with rural and cooperative banks located within the nearest to their respective areas of jurisdiction, provided that a rural and cooperative bank may only act as official depository of government funds pursuant to RA 7353 and RA 6938, respectively, and subject to prior approval of the BSP pursuant to Section 5(2) of BSP Circular 110 and the prerequisites for the grant of authority under Section 9 of the same circular. 3.0 RESPONSIBILITY AND SANCTIONS The Provincial , City, and Municipal Treasurers, Commissioners of BIR and BOC, Heads of attached agencies of the DOF and Heads of all GOCCs shall be responsible for the compliance of this Order. Failure to comply with the herein provisions shall subject the responsible officials and/or employees to appropriate criminal and or administrative action. 4.0 EFFECTIVITY This Order shall take effect immediately and shall supersede DOF Order No. 56-98 dated August 14, 1998 and subsequent DOF Memo dated December 21, 1998. (SGD.)EDGARDO B. ESPIRITU Secretary