REPUBLIC OF THE PHILIPPINES

COMMISSION ON AUDIT
Commonwealth Avenue, Quezon City, Philippines

CIRCULAR No. : 2005-001

Date : February 28, 2005

TO : All Heads of National Government Agencies, Local Government Units and

Government Owned and/or Controlled Corporations; Heads of Financial
Management Services/Comptrollership Departments, Heads of Accounting
Units; Heads of Budget Units; COA Assistant Commissioners, Directors,
Auditors; and All Others Concerned

SUBJECT : ACCOUNTING POLICIES RELATED TO THE BUDGETARY SYSTEM IN

THE NATIONAL, CORPORATE AND LOCAL GOVERNMENT SECTORS
UNDER THE NEW GOVERNMENT ACCOUNTING SYSTEM (NGAS)

1.0 RATIONALE/OBJECTIVES

Section 2 (2), Article IX-D of the 1987 Philippine Constitution mandates the
Commission on Audit to "xxx promulgate accounting and auditing rules and regulations
xxx".

This circular defines the roles and functions of the Heads of Budget or its
equivalent in the certification as to the availability of funds and obligations on
contracts/purchase orders and all claims against the government agencies. For
purposes of this circular, "funds" is construed to mean appropriations/allotments/ budget.

It also prescribes the revised forms for use in the obligation/utilization and
disbursement of such funds.

2.0 POLICIES

Under the NGAS, the Heads of the Budget or its equivalent and Accounting Units
shall have the following functions:

2.1 The Head of the Budget Unit or its equivalent shall maintain the registries of
funds/appropriations/allotments and obligations/utilization and shall certify on
their availability.

2.2 The Head of the Accounting Unit shall keep the records and certify on the
availability of cash.

The revised forms for the incurrence of obligation/utilization of budget and

 disbursement shall be as follows:

 Obligation Slip - for incurrence of obligation in the national and local

government sectors - Annex A
 Budget Utilization Slip - for utilization of the budget in the corporate
government sector - Annex B

 Disbursement Voucher - for payment of obligations/liabilities/ expenses

of all government agencies - Annex C

3.0 FORMULATION OF IMPLEMENTING GUIDELINES AND PROCEDURES

The Government Accounting and FMIS, this Commission, shall prepare the
necessary implementing guidelines and procedures on the recording and monitoring of
the Agency Budget and cash position.

4.0 REPEALING CLAUSE

All prior COA circulars/memoranda and other issuances inconsistent herewith are
hereby amended or repealed accordingly.

5.0 EFFECTIVITY

This Circular shall take effect April 1, 2005.

ATTACHMENTS:

Annexes A, B and C - Revised forms for the

Incurrence of Obligation/Utilization of
Budget and Disbursement - 478 KB; - 144 KB; - 60 KB