Restatement, with Amendments of RMO No. 38-86 Dated November 14, 1986 Regarding Implementation of the New Disbursement Scheme

June 1, 1987 REVENUE MEMORANDUM ORDER NO. 12-87 SUBJECT : Restatement, with Amendments of RMO No. 38-86 Dated November 14, 1986 Regarding Implementation of the New Disbursement Scheme TO : Assistant Commissioner (Financial and Management), Revenue Service Chief (Personnel and Administrative), Regional Directors and Others Concerned 1.0 Objectives 1.1 To restate, with amendments, of RMO No. 38-86 dated November 14, 1986 providing the guidelines, rules and procedures in the implementation of the New Disbursement Scheme (NDS) as prescribed under Joint Circular No. of the Commission on Audit, Department of Budget and Management and Department of Finance dated. 1.2 To delineate the responsibilities of the different offices and unite in the Bureau connected with the implementation of said scheme. 2.0 General Guidelines 2.1 Treasury warrants Type "B", instead of Cash Disbursement Ceiling, shall be used by the Department of Budget and Management (DIM) to fund BIR operations. 2.2 The use of TCAA checks and Type "B" treasury warrants by the BIR shall be discontinued as soon as the NDS is implemented in the Bureau. However, in case of tax refunds, the use of Type "B" TW shall be continued until December 31, 1987. 2.3 A regular current account shall be established by the BIR Central Office with the nearest Land Bank of the Philippines (LBP) Branch (Quezon City Branch) to cover the operational expenses of the BIR Central Office and Regional Offices. Regional Current accounts shall likewise be opened and maintained by the Regional Offices with the nearest LBP/PNB Branch to finance their activities. The regular current accounts maintained in the LBP/PNB Branch shall have a minimum daily balance of 1,000. Any balance of the current accounts at the end of each month may be used in the ensuing month(s) of the same year. However, balances pertaining to the unobligated allotment at the end of the year shall be withdrawn from the current accounts and deposited to the Bureau of Treasury (BTr), in accordance with the procedure herein prescribed. 2.4 Separate current accounts shall be opened for each fund to facilitate preparation of the bank reconciliation statement. Likewise, separate current account shall be opened and maintained by the BIR for collections authorized by law to be deposited in an authorized government depository bank for the implementation of projects as provided for under JC No. 9-81 and 9-81A, for which such collections are received using Account 8-70-300. 2.5 The funding treasury warrant to be issued by the DBM shall be deposited by DBM in the nearest LBP Branch (Quezon City Branch) for the account of the BIR. 2.6 Refund of cash advances within the year shall be duly acknowledged by an official receipt and shall be deposited to the BIR current account. However, refund of cash advances extended/given in prior year(s) shall be deposited with the BTR. 3.0 Specific Guidelines 3.1 Not later than 15 days before the implementation of the NDS, the BIR Central Office shall submit to National Accounting Finance Bureau (NAFB) of the DBM a copy of the Work and Financial Plan (WFP) of the BIR and any modification thereto, to serve as basis for the release of the initial funding warrant to cover the monthly operational expenses of the BIR Central and Regional Offices. Within 10 days before the start of the months of July and August, 1987, the DBM shall issue to the nearest LBP Branch the funding treasury warrant for deposit to the regular current account of the BIR, notifying the BIR Central Office of such deposit thru the "Notice of Funding Warrant Issued" (NFWI). acd The servicing LBP Branch (Quezon City Branch) shall notify through credit advice the BIR Central Office of the deposits made by DBM. Thereafter, the DBM shall issue the monthly funding warrant on the basis of the Monthly Status of Fund (MSF) to be submitted by the BIR. The BIR shall also submit direct to DBM-NAFB requests for funding requirements covering accounts payable including obligations incurred from January to June 1987 but remain unpaid as of June 30, 1987, revalidation of CDC's, etc. 3.2 The BIR Central Office shall request the nearest LBP Branch (Quezon City Branch) to make the necessary fund transfers from the regular current account maintained by the BIR Central Office to the respective bank accounts of the regional offices, furnishing the LBP Quezon City Branch the distribution list of such transfers. Simultaneously, the BIR Central Office shall issue to the regional offices their respective approved sub-allotment advice and Request for Obligation of Allotment (ROA) to serve as basis of the payment of obligations of the regions. If the sub-allotments earlier released to the regions are inadequate, the BIR Regional Offices concerned shall submit to the BIR Central Office a request for additional funds, citing the justifications therefor. Subject to fund availability and approval of the corresponding WFP by the DBM, the BIR Central Office shall release to the regional offices concerned the requested additional funds. 3.3 The BIR Central and Regional Offices shall issue commercial checks in numerical sequence to pay current obligations and prior year's accounts payable. The Regional Offices shall make disbursements only upon receipt of the LBP credit advice as well as the approved sub-allotment advice and ROA. 3.4 The BIR shall charge all Fiscal Agency Service (FAS) transactions against the regular current account of the Bureau. 3.5 The LBP/PNB Branch shall furnish the BIR Central Office and Regional Offices the bank statements within 10 days after the end of each month which shall be the basis in preparing the monthly reconciliation statements. cd 3.6 The BIR Central Office shall maintain required accounting records for deposits made by DBM to LBP Quezon City Branch and checks drawn against the current account and submit accountability reports and related financial statements as indicated in Item 5.1 hereof. 4.0 Duties and Responsibilities 4.1 The Chief, Budget Division shall: 4.1.1 Submit within 15 days before the date of implementation of the NDS, a copy of the WFP and any modification thereto, to the DBM-NAFB for purposes of the issuance of DBM of the initial funding warrants. 4.1.2 Determine the allocation of funds for each regular program, special program, sub-program, regional office and allotment class based on the approved Allotment Advice (AA) issued by the DBM, including charges and modifications thereof. 4.1.3 Prepare and issue sub-allotment advice to regional offices to cover the expenditures of the regions, copy furnished the Disbursement Accounting Division. 4.1.4 Obligate the sub-allotment thru the Request for Obligation of Allotment (ROA). Furnish the regional offices the approved ROA. 4.1.5 Forward to Chief, Disbursement Accounting Division approved fund allocations for each regular program, special program, sub-program, and regional office as well as ROA. 4.1.6 Maintain records of sub-allotments released to regional offices and obligations charged thereon. 4.2 The Chief, Disbursement Accounting Division shall: 4.2.1 Request the BTR copies of the BIR treasury account current as of June 30, 1987 for the treasury account current as of June 30, 1987 for the treasury disbursement accounts 8-70-702, 8-70-703 and 8-70-709 as basis for the preparation of the treasury/BIR reconciliation statements. 4.2.2 Record the usual release of allotment upon receipt of the AA. 4.2.3 Inform the Chief, General Services Division of all deposits made to the BIR Central Office current account upon receipt of the NFWI from the DIM and the credit advice from the servicing LBP Branch. 4.2.4 Record the deposits made by DIM in the current account based on the Bank's credit advice as confirmed by DIM's NFWI. 4.2.5 Request the servicing LBP Branch to make necessary fund transfers in the affected current accounts, as indicated in the 1st paragraph of item 3.2 hereof. 4.2.6 Maintain Journal of Commercial Checks Issued for commercial checks drawn against the current account. 4.2.7 Reconcile the current account of the BIR Central Office with the monthly bank statement furnished by the LBP Branch. 4.2.8 Prepare the consolidated BIR Central and Regional Offices' Monthly Status of Fund for submission to DIM on or before the 15th day of the current month , furnishing BTR (Fiscal Management Division) a copy thereof. 4.2.9 Notify DIM-NAFB and COA (Accountancy Office) of the year-end deposits made by BIR Central and Regional Offices to the BTR pertaining to the unobligated allotment as of December 31 of each year. 4.2.10 Prepare year-end trial balances. 4.3 The Chief, General Services Division shall: 4.3.1 Prepare inventory report of unused TCAA checks and Treasury Warrants Type "B" as of June 30, 1987 by listing therein the inclusive serial numbers of the unused blank TCAA checks and TW Type "B" to be certified by the custodian and verified by the COA Unit Auditor. Require the custodian to immediately surrender the unused TCAA checks and TWs to the Auditor pending final disposal. cd 4.3.2 Dispose the unused blank TCAA checks and Treasury Warrant Type "B" in accordance with the procedures prescribed under Joint COA-DF-DIM Circular No. 7-81 and Treasury Memorandum Circular No. 8-75. Prepare a certificate attesting to the disposition of the aforesaid TCAA checks and TW. 4.3.3 Require Deputized Disbursing Officers to surrender deputation statements to Treasury Provincial Fiscal Examiners (TPFE) concerned and request cancellation of deputation of signing and countersigning officials. 4.3.4 Furnish a copy of the Certificate of Last TCAA Check and TW "B" issued as of the 2nd Quarter 1987 to the TPFE concerned and SCD, BTR as well as the BIR Resident Auditor. 4.3.5 Post the appropriate Fidelity Bonds with the BTR for BIR officials authorized to sign and countersign commercial checks. 4.3.6 Establish regular current account with the nearest LBP Branch (Quezon City Branch) effective July 1, 1987. 4.3.7 Requisition blank commercial checks from the LBP Quezon City Branch for use in the BIR Central Office. 4.3.8 Issue commercial checks in numerical sequence to pay current year obligations and prior year's accounts payable by the BIR Central Office. 4.3.9 Furnish the Bank daily or as often as necessary the original and one (1) copy of the "Advice of Commercial Checks Released and Checks Cancelled", copy furnished the COA Unit Auditor. 4.3.10 Require the cashier to prepare and submit the Weekly Report of Checks issued to the Chief, Disbursement Accounting Division, on the 7th, 15th, 22nd and end of the month. 4.3.11 Prepare and submit, not later than the 8th day of the succeeding month , the Report of Disbursement by Disbursing Officer to the Chief, Disbursement Accounting Division. 4.3.12 Withdraw the unexpended balances of the current account pertaining to the unobligated allotment at the end of the year and remit the same to the BTR covered by a remittance advice. 4.4 The Chief, Administrative Branch (in regional offices) shall: 4.4.1 Require Deputized Disbursing Officers to surrender deputation statements to Treasury Provincial Fiscal Examiners (TPFE) concerned and request cancellation of deputation of signing and countersigning officials. acd 4.4.2 Prepare inventory report of unused blank TCAA checks and Treasury Warrants Type "B" as of June 30, 1987 by listing therein the inclusive serial numbers of the unused blank TCAA checks and TW Type "B" to be certified by the custodian and verified by the BIR Regional Auditor. Require the custodian to immediately surrender the unused TCAA checks and TWs to the Regional Auditor pending final disposal. 4.4.3 Dispose the unused blank TCAA checks and Treasury Warrant Type "B" in accordance with the procedures prescribed under Joint COA-MF-MIM Circular No. 7-81 and Treasury Memorandum Circular No. 8-73. Prepare a certificate attesting to the disposition of the aforesaid TCAA checks and TW. 4.4.4 Furnish a copy of the Certificate of Last TCAA Checks and TW "B" issued as of the 2nd Quarter 1987 to the TPFE concerned and SCD, BTR as well as the Regional Auditor. 4.4.5 Close and remit to the BTR by remittance advice the book balances of bank accounts presently being maintained for the operation and other requirements of the regional office as of June 30, 1987. 4.4.6 Establish current deposit account with the nearest LBP/PNB Branch for operational expenses and payment of accounts payable of the regional office. 4.4.7 Requisition blank commercial checks from the authorized servicing bank. 4.4.8 Issue commercial checks in numerical sequence to pay regional current year obligations and prior year's accounts payable, subject to the provisions of item 3.3 hereof. 4.4.9 Prepare and submit, not later than the 8th day of the succeeding month , the Report of Commercial Checks Issued and Cancelled to the Chief, Disbursement Accounting Division, copy furnished the Chief, Budget Division. aisa dc 4.4.10 Prepare and submit not later than the 8th day of the succeeding month , the Report of Disbursement by Disbursing Officer to the Chief, Disbursement Accounting Division. 4.4.11 Prepare and submit to the servicing LBP/PNB Branch daily or as often as necessary the Advice of Commercial Checks Released and Cancelled, copy furnished the BIR Regional Auditor. 4.5 The Chief, Fiscal Operations Branch (in regional offices) shall: 4.5.1 Prepare and submit, not later than the 8th day of the succeeding month , the Monthly Status of Funds, to the Chief, Disbursement Accounting Division, copy furnished the Chief, Budget Division. 4.5.2 Prepare and submit to Chief, Budget Division requests for changes and modifications of budgetary allocations of the regional office, including justifications therefor. 4.5.3 Prepare and submit monthly bank reconciliation statements to Chief, Disbursement Accounting Division. 4.6 The Assistant Commissioner (Financial and Management) shall: 4.6.1 Sign and approve, by authority to the Commissioner of Internal Revenue, the Advice of sub-allotments intended for the regional offices. 4.6.2 Direct the preparation, sign and transmit to the depository/servicing LBP Branch the request for fund transfer for the affected current accounts, as indicated in items 3.2 and 4.2.5 hereof. 4.6.3 Require the accurate preparation and submission of financial reports and statements. 4.7 The Revenue Service Chief (Personnel and Administrative) shall: 4.7.1 Comply with the requirements of the depository/servicing LBP Branch regarding the maintenance and operation of the current account. casia 4.7.2 Require the accurate preparation and timely submission of financial reports and statements. 4.8 The Regional Director shall: 4.8.1 Ensure compliance with this revenue memorandum order from regional officials and employees concerned. 4.8.2 Require the accurate preparation and submission of financial reports and statements. 5.0 Submission Deadline for Reports 5.1 The deadline for submission of the following reports to the BIR Central Office shall be on the date opposite the name of the reports: Monthly Status of Funds Report of Commercial Checks Issued and Cancelled Report of Disbursements by Deputized Disbursing Officers On or before the 8th day of the succeeding month. - do - - do - 5.2 The BIR Central Office shall release the approved sub-allotment and LOA for any given month to the regional office only after the required reports and statements shall have been submitted. acd 6.0 Repealing Clause The provision of any circular memorandum order and other rules and regulations inconsistent herewith are repealed and/or modified accordingly. 7.0 Effectivity This revenue memorandum order shall take effect July 1, 1987. (SGD.) BIENVENIDO A. TAN, JR. Commissioner