Creation of an Internal Control Unit to Perform the Pre-Audit Function Previously Done by the Commission on Audit

September 1, 1981 REVENUE MEMORANDUM ORDER NO. 28-81 SUBJECT : Creation of an Internal Control Unit to Perform the Pre-Audit Function Previously Done by the Commission on Audit TO : All Internal Revenue Officers and Others Concerned In view of the withdrawal of the pre-audit function on certain types of transactions as provided in COA Circular No. 81-26(k) dated July 2, 1981, the fiscal responsibility for ascertaining the authenticity, correctness and reasonableness of all expenditures of the Bureau not subject to pre-audit by COA shall now rest directly with the Commissioner of Internal Revenue. casia In the exercise of this function, a system of safeguards and internal control are hereby prescribed for all concerned to insure that all disbursements made by the Bureau are in accordance with existing fiscal policies, accounting and auditing regulations. For this purpose, Internal Control Units are hereby created both in the National and Regional Offices to conduct among others, the pre-audit activities. A. INTERNAL CONTROL UNITS 1. National Office - The Internal Control Unit in the Central Office shall be placed under the direct supervision of the Chief, Accounting Division who is the accountable officer for the Auditor's Certificate of Settlement and Balances issued to the Bureau pursuant to Item 3, Section 2 of COA Circular No. 81-156 dated January 19, 1981. Specifically, it shall be responsible for and perform the following functions: acd a) Pre-audit all transactions particularly those mentioned in the aforementioned COA Circulars. (See Sec. B of this Order) b) Determine that all claims submitted to the BIR for payment comply with the agency's fiscal policies and with accounting and auditing rules and regulations; c) See to it that all guidelines on the proper use of the revised Disbursement Voucher Form (General Form No. 5A) prescribed by COA Circular No. 81-155 dated February 23, 1981 are strictly complied with. d) Check if all the documentary requirements listed in the reverse side of the Disbursement Form as specified in RMO No. 26-81 dated August 27, 1981 are attached to the voucher. e) See to it that the supplies, materials or equipments delivered to the Bureau have been inspected by the BIR Acceptance and Inspection Committee and the report thereof is attached to the claim for payment. casia f) Cause the compliance of auditing requirements for the lifting of all letter-suspension effected by the Commission on Audit. 2. Revenue Regional Office - In the Revenue Regional Offices, the task of pre-auditing all disbursement payments within the region shall be performed by the Fiscal Operation Unit created under Revenue Administrative Order No. 4-81 dated August 14, 1981. The Regional Directors shall see to it that the specific functions enumerated in A-1 above are strictly complied with in their respective jurisdictions. B. Transactions No Longer subject to COA pre-audit The following transactions are no longer subject to pre-audit by the COA: 1. Payments of fixed expenditures such as rentals, subscriptions to periodicals, and other expenditures amounting to P2,000 or less per month which are recurring and fixed in nature; 2. Payments amounting to P20,000 or less of consummable items such as printed forms, office supplies, accounting forms, motor vehicle fuel, lubricants, tires, batteries, spare parts, construction materials, medical supplies, ammunition, electricity, gas, water and other expendable property normally consumed within one year after being put to use, or converted in the process of manufacture or construction. cd 3. Payment of salaries and wages of officers and employees, either original appointment, promotional appointment, appointment by transfer, appointment by reinstatement and employment under labor payroll chargeable against project funds except the last payment prior to retirement, separation, resignation, etc. 4. Payments of expenditures other than those enumerated in number 1, 2, & 3 above involving not more than P40,000.00. REPEALING CLAUSE This Order revokes or modifies any provisions of existing issuances which are inconsistent with this Order. cd i EFFECTIVITY This Order takes effect upon approval hereof. RUBEN B. ANCHETA Acting Commissioner