Implementation of the New Disbursement Scheme

November 14, 1986 REVENUE MEMORANDUM ORDER NO. 38-86 Subject : 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 provide guidelines, rules and procedures in the implementation of the New Disbursement Scheme effective January 1, 1987 as prescribed under Joint Circular No. 4-86 of the Commission on Audit, Ministry of Budget and Management and Ministry of Finance dated August 12, 1986. 1.2 To delineate the responsibilities of the different offices and units in the Bureau connected with the implementation of said scheme. 2.0 General Guidelines 2.1 Treasury warrants shall be used to fund BIR operations instead of Cash Disbursement Ceiling. 2.2 The use of the TCAA checks and "Type B" treasury warrants shall be discontinued and the related treasury disbursement accounts shall be closed as of December 31, 1986. 2.3 A current account shall be established by the BIR Central Office with the nearest Philippine National Bank (PNB) Branch to cover the operational expenses of the BIR Central Office. Regional current accounts shall likewise be opened and maintained by the Regional Offices with the PNB branch/ extension office to fund their operations. The current accounts maintained in the PNB Head and Branch Offices shall have a minimum daily balance of P1,000. Any balance of the current accounts at the end of each month may be used in the ensuing month(s). However, balances pertaining to the unobligated allotment at the end of the year shall be withdrawn from the current accounts and deposited to the Bureau of Treasury (BTr) in accordance with the procedures herein prescribed. 2.4 The funding treasury warrant which is issued by the Ministry of Budget and Management (MBM) based on the BIR request shall be deposited by MBM in the PNB Head Office for the account of the BIR Central and Regional Offices as shown in the OBM letter-advice (NAO Form No. 002). 3.0 Specific Guidelines 3.1 The BIR Central Office shall request the MBM for issuance of funding warrant to cover the monthly operational expenses of the BIR Central and Regional Offices and payment of prior year's accounts payable. 3.2 The MBM shall deposit with PNB Main Office the funding warrant to the credit of the current account of the BIR Central and Regional Offices, simultaneously notifying the BIR Central and Regional Offices of such deposit thru the "Notice of Funding Warrant Issued" (NFWI). The PNB Head Office shall likewise notify thru credit advice the BIR Central and Regional Offices of the deposits made by MBM. 3.3 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 bases for 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. If the allotted funds of the BIR will allow, the necessary sub-allotment advice and ROA shall immediately be released to the requesting regional office. The BIR Central Office shall request the PNB Head Office (Fund Transfer Department) to effect the necessary fund transfer in the affected current accounts. 3.4 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 MBM NFWI and the PNB credit advice as well as the approved sub-allotment advice and ROA. cdt 3.5 The PNB Head and Branch Offices shall furnish BIR Central 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. 3.6 The BIR Central Office shall maintain required accounting records for deposits made by MBM to 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 end of the current month , the request to MBM for issuance of funding warrant to cover the operational expenses of the BIR Central and Regional Offices for the ensuing month and the amount needed for payment of prior year's accounts payable. The request shall be supported by the Monthly Status of Fund and a list of obligations showing details by functions and projects and allotment class. For the period January 1 to June 30, 1987, submit the request not later than December 20, 1986 indicating the monthly regional breakdown by fund allotment and object class of expense. 4.1.2 Determine the allocation of funds for each function, project, regional office and allotment class based on the approved Allotment Advice (AA) issued by the MBM, including changes and modifications thereof. cd i 4.1.3 Prepare and issue sub-allotment advices 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 function, project and regional office and 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 December 31, 1986 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 MBM and the credit advice from the PNB Head Office. 4.2.4 Record the deposits made by MBM in the current account based on the Bank's credit advice as confirmed by MBM's NFWI. 4.2.5 Request the PNB Head Office to make necessary fund transfers in the affected current accounts, as indicated in the 2nd paragraph of item 3.3 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 Bank. 4.2.8 Prepare the consolidated BIR Central and Regional Offices' Monthly Status of Fund for submission to MBM on or before the 15th day of the current month , furnishing BTR (Fiscal Management Division) a copy thereof. 4.2.9 Notify MBM 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 consolidated year-end trial balances. 4.3 The Chief, General Services Division shall: 4.3.1 Prepare inventory report of unused blank TCAA checks and Treasury Warrants Type "B" as of December 31, 1986 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. 4.3.2 Dispose the unused blank TCAA checks and Treasury Warrant Type "B" in accordance with the procedures prescribed under Joint COA-MF-MBM 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. 4.3.3 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 Establish current deposit account with the PNB Head Office effective January 1, 1987 . 4.3.5 Requisition blank commercial checks from the PNB Head Office for use in the BIR Central Office. 4.3.6 Issue commercial checks in numerical sequence to pay current year obligations and prior year's accounts payable by the BIR Central Office. 4.3.7 Furnish the Bank daily or as often as necessary an "Advice of Commercial Checks Released and Checks Cancelled", copy furnished the COA Unit Auditor. cdt 4.3.8 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. 4.3.9 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. 4.3.10 Withdraw the unexpected balance 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. 4.4.2 Prepare inventory report of unused blank TCAA checks and Treasury Warrants Type "B" as of December 31, 1986 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. 4.4.3 Dispose the unused blank TCAA checks and Treasury Warrant Type "B" in accordance with the procedures prescribed under Joint COA-MF-OBM 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 Close and remit to the BTR by remittance advice the book balances of bank accounts presently being maintained for the operations and other requirements of the regional office as of December 31, 1986. cd i 4.4.5 Establish current deposit account with the PNB branch/extension office for operational expenses and payment of accounts payable of the regional office. 4.4.6 Requisition blank commercial checks from the PNB branch/extension office. 4.4.7 Issue commercial checks in numerical sequence to pay regional current year obligations and prior year's accounts payable, subject to the provisions of item 3.4 hereof. 4.4.8 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. 4.4.9 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. 4.4.10 Prepare and submit to the Bank daily or as often as necessary the Advice of Commercial Checks Released and Cancelled, copy furnished the BIR Regional Auditor. casia 4.5 The Chief, Fiscal Operations Unit (in regional offices) shall: 4.5.1 Prepare and submit, not later than the 5th day of the current month , to Chief, Budget Division an estimate of funding requirements to cover operational expenses of the regional office for the ensuing month and prior year's accounts payable, showing breakdown of obligations by function, project and object class of expenditures, duly supported with the Monthly Status of Funds. 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 the monthly bank reconciliation statements to Chief, Disbursement Accounting Division. 4.5.4 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. 4.6 The Assistant Commissioner (Financial and Management) shall: 4.6.1 Sign and approve, by authority of 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 PNB Head Office the request for fund transfer for the affected current accounts, as indicated in items 3.3 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 PNB Head Office regarding the maintenance and operation of the current account. 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 Central Office shall be on the date opposite the name of the report: Estimate of Funding Requirements On or before the 5th day of the current month Monthly Status of Funds On or before the 8th day of the succeeding month Report of Commercial Checks - do - Issued and Cancelled Report of Disbursements by - do - Deputized Disbursing Officers 5.2 The Central Office shall release the approved sub-allotment and ROA for any given month to the regional offices only after the required reports and statements shall have been submitted. 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 January 1, 1987. aisa dc BIENVENIDO A. TAN, JR. Commissioner