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RE: Is a Regional Head required to make APP?

Post by mindlex on Tue Jan 26, 2010 2:47 pm

SITUATION: Regional Office of a national agency is not being asked to prepare a PPMP. Regional also also doesn't have a copy of APP. What is being done is that the regional head was designated as a Special Disbursing Officer to carry a Cash advance of 200k annually for local purchase of office supplies, gasoline, communication. The same shall be charged to the MOOE and subject to liquidation. Should the said regional office make its own APP ? If yes, should it have its own BAC also? If yes again, who is authorized to create the Regional BAC?
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Re: RE: Is a Regional Head required to make APP?

Post by sunriser431 on Wed Jan 27, 2010 1:57 pm

mindlex wrote:SITUATION: Regional Office of a national agency is not being asked to prepare a PPMP. Regional also also doesn't have a copy of APP. What is being done is that the regional head was designated as a Special Disbursing Officer to carry a Cash advance of 200k annually for local purchase of office supplies, gasoline, communication. The same shall be charged to the MOOE and subject to liquidation. Should the said regional office make its own APP ? If yes, should it have its own BAC also? If yes again, who is authorized to create the Regional BAC?
Hi mindlex welcome to the forum, from the very limited information you gave, I'll try to as much possible to provide ans to your concern. Since your agency have 200k annually budgeted at the disposal of the regional head, this works similar to revolving petty cash fund. From the point of view of the accounting/finance, The cash advance is subject to liquidation but provided within the COA rules and regulations.(ask your COA resident auditor) However it shall not be used for payment of regular expenses such as rentals, subcriptions, light and water and the like. otherwise it will be disallowed by COA. If the scenario you presented then I suppose there is no need to create separate BAC. Hope this would help. bounce
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Re: RE: Is a Regional Head required to make APP?

Post by RDV @ GP3i on Wed Jan 27, 2010 2:22 pm

mindlex wrote:SITUATION: Regional Office of a national agency is not being asked to prepare a PPMP. Regional also also doesn't have a copy of APP. What is being done is that the regional head was designated as a Special Disbursing Officer to carry a Cash advance of 200k annually for local purchase of office supplies, gasoline, communication. The same shall be charged to the MOOE and subject to liquidation. Should the said regional office make its own APP ? If yes, should it have its own BAC also? If yes again, who is authorized to create the Regional BAC?

From the information given, I could infer that procurement in that particular national government agency (NGA) is not decentralized.

The HOPE in that NGA is, if it is a department, the department secretary while the BAC is centralized in the central office. It is still consistent with RA 9184 and its IRR since the requirement is the creation of at least one (1) BAC for every procuring entity. In that case, and if the HOPE decides that there is no need to create additional BACs for the regional offices, then procurement will have to be done in the central office and the APP prepared there.

In the meantime, I would defer commenting on the designation of the regional head as SDO to carry cash advance of P200k annually for local purchases, on the assumption that such procurements/purchases of the regional office are included in the approved APP of the central office.
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Re: RE: Is a Regional Head required to make APP?

Post by sunriser431 on Wed Jan 27, 2010 3:15 pm

mindlex wrote:SITUATION: Regional Office of a national agency is not being asked to prepare a PPMP. Regional also also doesn't have a copy of APP. What is being done is that the regional head was designated as a Special Disbursing Officer to carry a Cash advance of 200k annually for local purchase of office supplies, gasoline, communication. The same shall be charged to the MOOE and subject to liquidation. Should the said regional office make its own APP ? If yes, should it have its own BAC also? If yes again, who is authorized to create the Regional BAC?
Additional requirements for accountable officers handling cash and cash items to be properly bonded, considering the amount involved, its mandatory to secure as such. bounce
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Re: RE: Is a Regional Head required to make APP?

Post by mindlex on Wed Jan 27, 2010 3:27 pm

sunriser431 wrote:
mindlex wrote:SITUATION: Regional Office of a national agency is not being asked to prepare a PPMP. Regional also also doesn't have a copy of APP. What is being done is that the regional head was designated as a Special Disbursing Officer to carry a Cash advance of 200k annually for local purchase of office supplies, gasoline, communication. The same shall be charged to the MOOE and subject to liquidation. Should the said regional office make its own APP ? If yes, should it have its own BAC also? If yes again, who is authorized to create the Regional BAC?
Hi mindlex welcome to the forum, from the very limited information you gave, I'll try to as much possible to provide ans to your concern. Since your agency have 200k annually budgeted at the disposal of the regional head, this works similar to revolving petty cash fund. From the point of view of the accounting/finance, The cash advance is subject to liquidation but provided within the COA rules and regulations.(ask your COA resident auditor) However it shall not be used for payment of regular expenses such as rentals, subcriptions, light and water and the like. otherwise it will be disallowed by COA. If the scenario you presented then I suppose there is no need to create separate BAC. Hope this would help. bounce

Hi, thanks so much for the fast reply. anyways, here are the rest of the details and follow up questions - Bulk of the cash advance is for office supplies and materials. 2k is for communication services (mailing of letters), 3k for gasoline and 2k for repairs of office equipments. If there is no need for the regional offices to create a separate BAC, how should it go about its procurements? if it resort to shopping or procurement of small value, who shall sign the necessary documents and approve the procurements?

Could not defer the designation of regional head as Special Disbursing Officer since supplies are limited and nobody knows how long will it take head office to provide regional offices the supplies needed. As RDV pointed out, procurement is centralized at the head office but so as not to disrupt the functions in the regions, regional heads are given cash advances merely for the above-mentioned items.
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Re: RE: Is a Regional Head required to make APP?

Post by sunriser431 on Thu Jan 28, 2010 9:29 am

mindlex wrote:
sunriser431 wrote:
mindlex wrote:SITUATION: Regional Office of a national agency is not being asked to prepare a PPMP. Regional also also doesn't have a copy of APP. What is being done is that the regional head was designated as a Special Disbursing Officer to carry a Cash advance of 200k annually for local purchase of office supplies, gasoline, communication. The same shall be charged to the MOOE and subject to liquidation. Should the said regional office make its own APP ? If yes, should it have its own BAC also? If yes again, who is authorized to create the Regional BAC?
Hi mindlex welcome to the forum, from the very limited information you gave, I'll try to as much possible to provide ans to your concern. Since your agency have 200k annually budgeted at the disposal of the regional head, this works similar to revolving petty cash fund. From the point of view of the accounting/finance, The cash advance is subject to liquidation but provided within the COA rules and regulations.(ask your COA resident auditor) However it shall not be used for payment of regular expenses such as rentals, subcriptions, light and water and the like. otherwise it will be disallowed by COA. If the scenario you presented then I suppose there is no need to create separate BAC. Hope this would help. bounce

Hi, thanks so much for the fast reply. anyways, here are the rest of the details and follow up questions - Bulk of the cash advance is for office supplies and materials. 2k is for communication services (mailing of letters), 3k for gasoline and 2k for repairs of office equipments. If there is no need for the regional offices to create a separate BAC, how should it go about its procurements? if it resort to shopping or procurement of small value, who shall sign the necessary documents and approve the procurements?

Could not defer the designation of regional head as Special Disbursing Officer since supplies are limited and nobody knows how long will it take head office to provide regional offices the supplies needed. As RDV pointed out, procurement is centralized at the head office but so as not to disrupt the functions in the regions, regional heads are given cash advances merely for the above-mentioned items.
Additional information needed, hope you dont mind, I believe your agency have resident COA auditor, May I ask if they (COA) conduct cash examination on the cash advances given to SDO? or is there a revolving petty cash book being maintain to record all the petty transactions/expenses as they incurred? bounce
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Re: RE: Is a Regional Head required to make APP?

Post by mindlex on Thu Jan 28, 2010 10:04 am

sunriser431 wrote: Additional information needed, hope you dont mind, I believe your agency have resident COA auditor, May I ask if they (COA) conduct cash examination on the cash advances given to SDO? or is there a revolving petty cash book being maintain to record all the petty transactions/expenses as they incurred? bounce

Yup, COA conducts cash examination and there is a disbursement book being prepared by the finance people to record the expenses. Very Happy
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Re: RE: Is a Regional Head required to make APP?

Post by sunriser431 on Thu Jan 28, 2010 2:20 pm

mindlex wrote:
sunriser431 wrote: Additional information needed, hope you dont mind, I believe your agency have resident COA auditor, May I ask if they (COA) conduct cash examination on the cash advances given to SDO? or is there a revolving petty cash book being maintain to record all the petty transactions/expenses as they incurred? bounce

Yup, COA conducts cash examination and there is a disbursement book being prepared by the finance people to record the expenses. Very Happy
So there you have it, as far as I am concern, the character and nature of the CA will only be used for specific purpose for which it is granted, and will be subject to liquidation in accordance with COA rules and regulations. The subject expenses for liquidation will however depend on the supporting documents as required and by the very nature of the expenses as they inccur. ex you made mention gasoline, to support such liquidation a receipts/sales invoice is needed and duly supported by approved trip ticket. Meanwhile the GPRA speaks for the governing principles on government procurement of which different from the requirements for Cash Advances. Hope this would be of help. bounce
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Re: RE: Is a Regional Head required to make APP?

Post by mindlex on Wed Feb 03, 2010 12:51 pm

sunriser431 wrote:
mindlex wrote:
sunriser431 wrote: Additional information needed, hope you dont mind, I believe your agency have resident COA auditor, May I ask if they (COA) conduct cash examination on the cash advances given to SDO? or is there a revolving petty cash book being maintain to record all the petty transactions/expenses as they incurred? bounce

Yup, COA conducts cash examination and there is a disbursement book being prepared by the finance people to record the expenses. Very Happy
So there you have it, as far as I am concern, the character and nature of the CA will only be used for specific purpose for which it is granted, and will be subject to liquidation in accordance with COA rules and regulations. The subject expenses for liquidation will however depend on the supporting documents as required and by the very nature of the expenses as they inccur. ex you made mention gasoline, to support such liquidation a receipts/sales invoice is needed and duly supported by approved trip ticket. Meanwhile the GPRA speaks for the governing principles on government procurement of which different from the requirements for Cash Advances. Hope this would be of help. bounce

So it means that the office doesn't have to prepare an APP or create a regional BAC has to spend the CA based on what was authorized and that it has to follow the rules on liquidation of CA. Did I get it right?

Follow-up question again: If the CA the office is receiving is covered by a different governing principles than those covered by the GPRA, does it still have to follow the rules on procurement like the canvassing of 3 suppliers for office supplies or could it just buy office supplies without going through "shopping" and other alternative modes of procurement?

BTW, thanks! You've been a great help!!
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Re: RE: Is a Regional Head required to make APP?

Post by Niwram on Wed Feb 03, 2010 4:36 pm

As long as public funds will be used, the rules on procurement shall be followed..
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Re: RE: Is a Regional Head required to make APP?

Post by sunriser431 on Wed Feb 03, 2010 10:58 pm

mindlex wrote:
sunriser431 wrote:
mindlex wrote:
sunriser431 wrote: Additional information needed, hope you dont mind, I believe your agency have resident COA auditor, May I ask if they (COA) conduct cash examination on the cash advances given to SDO? or is there a revolving petty cash book being maintain to record all the petty transactions/expenses as they incurred? bounce

Yup, COA conducts cash examination and there is a disbursement book being prepared by the finance people to record the expenses. Very Happy
So there you have it, as far as I am concern, the character and nature of the CA will only be used for specific purpose for which it is granted, and will be subject to liquidation in accordance with COA rules and regulations. The subject expenses for liquidation will however depend on the supporting documents as required and by the very nature of the expenses as they inccur. ex you made mention gasoline, to support such liquidation a receipts/sales invoice is needed and duly supported by approved trip ticket. Meanwhile the GPRA speaks for the governing principles on government procurement of which different from the requirements for Cash Advances. Hope this would be of help. bounce

So it means that the office doesn't have to prepare an APP or create a regional BAC has to spend the CA based on what was authorized and that it has to follow the rules on liquidation of CA. Did I get it right?

Follow-up question again: If the CA the office is receiving is covered by a different governing principles than those covered by the GPRA, does it still have to follow the rules on procurement like the canvassing of 3 suppliers for office supplies or could it just buy office supplies without going through "shopping" and other alternative modes of procurement?

BTW, thanks! You've been a great help!!
I suppose your agency have in-house rules/or guidelines with regards the use of CA and the manner of liquidation, however there is nothing wrong if you propose canvassing for those over the counter supplies. For my part (our agency), we do have internal policy duly approved by the Board, that any amount spend for CA in excess of P 1,000.00 should be supported by at least 3 canvass form. so in effect any amount less, it is no longer required. Actually our COA resident auditor have not issue any AOM regarding the policy we have adopted.
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Re: RE: Is a Regional Head required to make APP?

Post by mindlex on Thu Feb 04, 2010 4:58 pm

sunriser431 wrote:
mindlex wrote:
sunriser431 wrote:
mindlex wrote:
sunriser431 wrote: Additional information needed, hope you dont mind, I believe your agency have resident COA auditor, May I ask if they (COA) conduct cash examination on the cash advances given to SDO? or is there a revolving petty cash book being maintain to record all the petty transactions/expenses as they incurred? bounce

Yup, COA conducts cash examination and there is a disbursement book being prepared by the finance people to record the expenses. Very Happy
So there you have it, as far as I am concern, the character and nature of the CA will only be used for specific purpose for which it is granted, and will be subject to liquidation in accordance with COA rules and regulations. The subject expenses for liquidation will however depend on the supporting documents as required and by the very nature of the expenses as they inccur. ex you made mention gasoline, to support such liquidation a receipts/sales invoice is needed and duly supported by approved trip ticket. Meanwhile the GPRA speaks for the governing principles on government procurement of which different from the requirements for Cash Advances. Hope this would be of help. bounce

So it means that the office doesn't have to prepare an APP or create a regional BAC has to spend the CA based on what was authorized and that it has to follow the rules on liquidation of CA. Did I get it right?

Follow-up question again: If the CA the office is receiving is covered by a different governing principles than those covered by the GPRA, does it still have to follow the rules on procurement like the canvassing of 3 suppliers for office supplies or could it just buy office supplies without going through "shopping" and other alternative modes of procurement?

BTW, thanks! You've been a great help!!
I suppose your agency have in-house rules/or guidelines with regards the use of CA and the manner of liquidation, however there is nothing wrong if you propose canvassing for those over the counter supplies. For my part (our agency), we do have internal policy duly approved by the Board, that any amount spend for CA in excess of P 1,000.00 should be supported by at least 3 canvass form. so in effect any amount less, it is no longer required. Actually our COA resident auditor have not issue any AOM regarding the policy we have adopted.

oh ok. Under your policy, when you say in excess of P1000, is it 1000 per item or 1000 per transaction (which may mean the purchase of several items)? how come mmp who is from gppb is stating otherwise - that as long as public funds are being used, then the rules on procurement shall be followed. I'm confused Laughing
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Re: RE: Is a Regional Head required to make APP?

Post by sunriser431 on Fri Feb 05, 2010 12:41 am

mindlex wrote:
oh ok. Under your policy, when you say in excess of P1000, is it 1000 per item or 1000 per transaction (which may mean the purchase of several items)? how come mmp who is from gppb is stating otherwise - that as long as public funds are being used, then the rules on procurement shall be followed. I'm confused Laughing
In my previous post, I made it clear, we do have internal policy duly approved by the Board, that any amount spend for CA in excess of P 1,000.00 should be supported by at least 3 canvass form. so in effect any amount less, it is no longer required. With regards to the undelline text I cannot provide answer to your query, you may have ask to mmp maybe she could elaborate further. bounce
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Re: RE: Is a Regional Head required to make APP?

Post by Niwram on Fri Feb 05, 2010 9:23 am

The underline text is an answer to the follow up question of mindlex..
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Re: RE: Is a Regional Head required to make APP?

Post by engrjhez® on Sat Feb 06, 2010 9:02 pm

mindlex wrote:
oh ok. Under your policy, when you say in excess of P1000, is it 1000 per item or 1000 per transaction (which may mean the purchase of several items)? how come mmp who is from gppb is stating otherwise - that as long as public funds are being used, then the rules on procurement shall be followed. I'm confused Laughing
In LGUs, we call it "petty cash". However, it has been a long time since "petty cash" was "enjoyed". mmp correctly pointed out that any use of government funds for procurement shall be governed by GPRA - true. What happens now on the CA/Petty Cash? It is clearly ILLEGAL. No procurement shall be undertaken unless it is in the approved Annual Procurement Plan. What can make the CA/Petty Cash LEGAL? We simply allocate a budget (based on historical records) on these small value procurement and put it in the APP. Whether the mode will be Shopping or Negotiated Procurement (or both) is up to the Procuring Entity thru the recommendation of the BAC. Very Happy
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Re: RE: Is a Regional Head required to make APP?

Post by sunriser431 on Sun Feb 07, 2010 1:56 pm

engrjhez wrote:
mindlex wrote:
oh ok. Under your policy, when you say in excess of P1000, is it 1000 per item or 1000 per transaction (which may mean the purchase of several items)? how come mmp who is from gppb is stating otherwise - that as long as public funds are being used, then the rules on procurement shall be followed. I'm confused Laughing
In LGUs, we call it "petty cash". However, it has been a long time since "petty cash" was "enjoyed". mmp correctly pointed out that any use of government funds for procurement shall be governed by GPRA - true. What happens now on the CA/Petty Cash? It is clearly ILLEGAL. No procurement shall be undertaken unless it is in the approved Annual Procurement Plan. What can make the CA/Petty Cash LEGAL? We simply allocate a budget (based on historical records) on these small value procurement and put it in the APP. Whether the mode will be Shopping or Negotiated Procurement (or both) is up to the Procuring Entity thru the recommendation of the BAC. Very Happy
In my understanding the "Petty Cash fund" is simply another form of CA, the only difference it is utilized for payment of small expenditures of which payment by the use of check is nearly to impossible, thats why its up to the PE how much the Revolving fund be appropriated in a given year (base historical data), of course this "Petty cash fund expenditures" must be included in the approved APP. bounce
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Re: RE: Is a Regional Head required to make APP?

Post by mindlex on Mon Feb 08, 2010 9:29 am

engrjhez wrote:
mindlex wrote:
oh ok. Under your policy, when you say in excess of P1000, is it 1000 per item or 1000 per transaction (which may mean the purchase of several items)? how come mmp who is from gppb is stating otherwise - that as long as public funds are being used, then the rules on procurement shall be followed. I'm confused Laughing
In LGUs, we call it "petty cash". However, it has been a long time since "petty cash" was "enjoyed". mmp correctly pointed out that any use of government funds for procurement shall be governed by GPRA - true. What happens now on the CA/Petty Cash? It is clearly ILLEGAL. No procurement shall be undertaken unless it is in the approved Annual Procurement Plan. What can make the CA/Petty Cash LEGAL? We simply allocate a budget (based on historical records) on these small value procurement and put it in the APP. Whether the mode will be Shopping or Negotiated Procurement (or both) is up to the Procuring Entity thru the recommendation of the BAC. Very Happy

ok so let me sum it up just to see if i get everybody's opinions correctly. So if the regional head is designated as a Special Disbursing Officer to disburse cash advances in the amount of P200k annually for the purchase of office supplies, he should make sure that the CA given him is included in the APP prepared by the head office. He should also check with the head office as to what is the mode of procurement allowed for CA so he'll know how to go about his purchases without violating any laws or regulations. So how is the "CA" indicated in the APP - is it indicated as budget for "CA" or an itemized budget of the items usually bought under CA?
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Re: RE: Is a Regional Head required to make APP?

Post by charlie brown on Mon Feb 08, 2010 5:35 pm

mindlex wrote:SITUATION: Regional Office of a national agency is not being asked to prepare a PPMP. Regional also also doesn't have a copy of APP. What is being done is that the regional head was designated as a Special Disbursing Officer to carry a Cash advance of 200k annually for local purchase of office supplies, gasoline, communication. The same shall be charged to the MOOE and subject to liquidation. Should the said regional office make its own APP ? If yes, should it have its own BAC also? If yes again, who is authorized to create the Regional BAC?

A regional office is usually headed by a regional director and has a full staffing complement and a budget of its own. this means that it will receive allotments and NCA either from its central office or from the DBM. it will also prepare financial statements at the end of the year. IN such a case the Reg. office will have its own APP, its own BAC and its own procurement. In the case presented it seems that there is no complete staffing and as presented, the regional head is only given a cash advance and thus does not really have an ABC of its own. its procurement will be subject to liquidation at the higher office and is part of the APP of the higher office.

From what i know (and a COA auditor will know better) a cash advance other than for salaries and travel - is usually for emergency procurement or petty cash expenses (tricycle or jeepney fare of utility worker, stamps, LIBCAP and the like). Since there are no Books of Accounts, there is no obligation in the agency. The obligation and payments are recorded at the higher office upon submission of liquidation papers. I think what is only prepared in this agency is a cash disbursements journal.

If my presumptions are correct then i would say that the said agency need not prepare its own APP but rather consider itself as an end-user and prepare a PPMP instead to be consolidated into the APP of the higher office.
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Re: RE: Is a Regional Head required to make APP?

Post by sunriser431 on Wed Feb 10, 2010 8:59 pm

mindlex wrote:
engrjhez wrote:
mindlex wrote:
oh ok. Under your policy, when you say in excess of P1000, is it 1000 per item or 1000 per transaction (which may mean the purchase of several items)? how come mmp who is from gppb is stating otherwise - that as long as public funds are being used, then the rules on procurement shall be followed. I'm confused Laughing
In LGUs, we call it "petty cash". However, it has been a long time since "petty cash" was "enjoyed". mmp correctly pointed out that any use of government funds for procurement shall be governed by GPRA - true. What happens now on the CA/Petty Cash? It is clearly ILLEGAL. No procurement shall be undertaken unless it is in the approved Annual Procurement Plan. What can make the CA/Petty Cash LEGAL? We simply allocate a budget (based on historical records) on these small value procurement and put it in the APP. Whether the mode will be Shopping or Negotiated Procurement (or both) is up to the Procuring Entity thru the recommendation of the BAC. Very Happy

ok so let me sum it up just to see if i get everybody's opinions correctly. So if the regional head is designated as a Special Disbursing Officer to disburse cash advances in the amount of P200k annually for the purchase of office supplies, he should make sure that the CA given him is included in the APP prepared by the head office. He should also check with the head office as to what is the mode of procurement allowed for CA so he'll know how to go about his purchases without violating any laws or regulations. So how is the "CA" indicated in the APP - is it indicated as budget for "CA" or an itemized budget of the items usually bought under CA?

excerpt from GPM.
On planning properly for contingency purchases
Section 7.1 of the IRR-A requires all procurement to be in accordance with the APP, and all procuring entities are not allowed to procure anything unless it is included in the APP. The requirement extends to those immediate purchases of readily available off-the-shelf goods and to contingencies. These purchases include those charged against cash advances, or the so-called “over-the-counter” purchases. Procuring entities are not allowed to procure anything unless it is included in the APP. Contingencies must therefore be provided for in the APP based on historical data. (IRR-A Section 7.3) This can be done by allocating for such purchases a percentage of the total procurement budget as reflected in the procuring entity’s APP. However, it would be advisable for this allocation not to be more than four percent (4%) of the total appropriations for Maintenance and Other Operating Expenses (MOOE) as provided for in the GAA. To enable it to plan its purchases more efficiently, and consequently approximate realistic levels for the amount that it would need for its contingency purchases or its small purchases of ordinary/regular office supplies/equipment, the procuring entity must conduct a regular study of its “Over-the-Counter Purchases”. Based on this study, the procuring entity would be able to identify recurring expenses that could more reasonably be included in the APP, and thus determine a more realistic allocation for contingencies.
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Re: RE: Is a Regional Head required to make APP?

Post by charlie brown on Fri Feb 12, 2010 11:34 am

mindlex wrote:
engrjhez wrote:
mindlex wrote:
oh ok. Under your policy, when you say in excess of P1000, is it 1000 per item or 1000 per transaction (which may mean the purchase of several items)? how come mmp who is from gppb is stating otherwise - that as long as public funds are being used, then the rules on procurement shall be followed. I'm confused Laughing
In LGUs, we call it "petty cash". However, it has been a long time since "petty cash" was "enjoyed". mmp correctly pointed out that any use of government funds for procurement shall be governed by GPRA - true. What happens now on the CA/Petty Cash? It is clearly ILLEGAL. No procurement shall be undertaken unless it is in the approved Annual Procurement Plan. What can make the CA/Petty Cash LEGAL? We simply allocate a budget (based on historical records) on these small value procurement and put it in the APP. Whether the mode will be Shopping or Negotiated Procurement (or both) is up to the Procuring Entity thru the recommendation of the BAC. Very Happy

ok so let me sum it up just to see if i get everybody's opinions correctly. So if the regional head is designated as a Special Disbursing Officer to disburse cash advances in the amount of P200k annually for the purchase of office supplies, he should make sure that the CA given him is included in the APP prepared by the head office. He should also check with the head office as to what is the mode of procurement allowed for CA so he'll know how to go about his purchases without violating any laws or regulations. So how is the "CA" indicated in the APP - is it indicated as budget for "CA" or an itemized budget of the items usually bought under CA?

The cash advance is not necessarily a method of procurement but a manner or the source of fund from which a particular procurement can be paid. thus, what will be included in the APP of agency level giving out the cash advance would be the provisions for contingencies/emergency procurement which are chargeable to the cash advance.
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Re: RE: Is a Regional Head required to make APP?

Post by mindlex on Fri Feb 12, 2010 2:44 pm

charlie brown wrote:
mindlex wrote:SITUATION: Regional Office of a national agency is not being asked to prepare a PPMP. Regional also also doesn't have a copy of APP. What is being done is that the regional head was designated as a Special Disbursing Officer to carry a Cash advance of 200k annually for local purchase of office supplies, gasoline, communication. The same shall be charged to the MOOE and subject to liquidation. Should the said regional office make its own APP ? If yes, should it have its own BAC also? If yes again, who is authorized to create the Regional BAC?

A regional office is usually headed by a regional director and has a full staffing complement and a budget of its own. this means that it will receive allotments and NCA either from its central office or from the DBM. it will also prepare financial statements at the end of the year. IN such a case the Reg. office will have its own APP, its own BAC and its own procurement. In the case presented it seems that there is no complete staffing and as presented, the regional head is only given a cash advance and thus does not really have an ABC of its own. its procurement will be subject to liquidation at the higher office and is part of the APP of the higher office.

From what i know (and a COA auditor will know better) a cash advance other than for salaries and travel - is usually for emergency procurement or petty cash expenses (tricycle or jeepney fare of utility worker, stamps, LIBCAP and the like). Since there are no Books of Accounts, there is no obligation in the agency. The obligation and payments are recorded at the higher office upon submission of liquidation papers. I think what is only prepared in this agency is a cash disbursements journal.

If my presumptions are correct then i would say that the said agency need not prepare its own APP but rather consider itself as an end-user and prepare a PPMP instead to be consolidated into the APP of the higher office.

The regional office has about 20 employees. Is that enough number to make its own BAC? Since the head office would not provide the regional office a copy of the APP, there is no way for the regional office to determine what items are included in the APP and/or what modes of procurement are listed therein. So would it be safer for the regional office to just make its own APP and create its own BAC even if it was not asked to do so by the head office and even if the amount involved is only 200K/annually? sorry guys if i'm a little bit "slow" in this area. had zero training about this but had to make a research for the office.
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Re: RE: Is a Regional Head required to make APP?

Post by RDV @ GP3i on Fri Feb 12, 2010 4:51 pm

mindlex wrote:
The regional office has about 20 employees. Is that enough number to make its own BAC? Since the head office would not provide the regional office a copy of the APP, there is no way for the regional office to determine what items are included in the APP and/or what modes of procurement are listed therein. So would it be safer for the regional office to just make its own APP and create its own BAC even if it was not asked to do so by the head office and even if the amount involved is only 200K/annually? sorry guys if i'm a little bit "slow" in this area. had zero training about this but had to make a research for the office.

It has enough number to create a BAC (5 to 7 members) but you need to ask permission first from your head office for that authority.

It is possible that because of a very minimal procurement (200k annually) being done by the regional office, the head office has deemed it unnecessary to decentralize the procurement to the regional office (which would necessitate the creation of its own BAC) and would rather just set the guidelines/limitations on the purchases being made by the latter, subject to the approved APP (in the head office) and to the conditions on the alternative methods of procurement that could be undertaken by the regional office.
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Re: RE: Is a Regional Head required to make APP?

Post by amang'65 on Fri Feb 12, 2010 10:41 pm

mindlex wrote:SITUATION: Regional Office of a national agency is not being asked to prepare a PPMP. Regional also also doesn't have a copy of APP. What is being done is that the regional head was designated as a Special Disbursing Officer to carry a Cash advance of 200k annually for local purchase of office supplies, gasoline, communication. The same shall be charged to the MOOE and subject to liquidation. Should the said regional office make its own APP ? If yes, should it have its own BAC also? If yes again, who is authorized to create the Regional BAC?


good evening po!

as far as your situation is concerned, your procurement is done through cash advances, definitely you need to prepare a procurement plan especially for your supplies and materials how would you justifiy your procurement when the law clearly states that there should be no procurement without a procurement plan. and yes you should have your BAC to recommend for what method of procurement should be used other than the default mode which is PB. and for your last question, it is the head of the agency who should designate your BAC based again of course on the provisions of RA9184.

i was just wondering why was your regional head need to be designated as an SDO? because i presume in a regional office, there should be an existing disbursing officer, therefore let your disbursing officer do all the cash advances bakit pa si HOPE eh may cashier naman siguro kayo na well bonded.
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Re: RE: Is a Regional Head required to make APP?

Post by sunriser431 on Sat Feb 13, 2010 1:22 am

mindlex wrote:
xxxx Since the head office would not provide the regional office a copy of the APP, there is no way for the regional office to determine what items are included in the APP and/or what modes of procurement are listed therein. So would it be safer for the regional office to just make its own APP and create its own BAC even if it was not asked to do so by the head office and even if the amount involved is only 200K/annually? xxxx .
To summarize your post.
In your first post you mentioned
1. xxxxx A regional head was designated as a Special Disbursing Officer
2. xxxxx A Cash advance of 200k given annually
In your second post
1. xxxx Bulk of the cash advance is for office supplies and materials. 2k is for communication services (mailing of letters), 3k for gasoline and 2k for repairs of office equipments)
In your third post
1. xxxx COA conducts cash examination and there is a disbursement book being prepared by the finance people to record the expenses
In your fourth post
1. xxxx He should make sure that the CA given him is included in the APP prepared by the head office.
In your last post
1.xxxx Since the head office would not provide the regional office a copy of the APP, there is no way for the regional office to determine what items are included in the APP xxxx. So would it be safer for the regional office to just make its own APP and create its own BAC even if it was not asked to do so by the head office and even if the amount involved is only 200K/annually? xxxx

I dont think its possible now (create your own BAC), since your Cental office already made its decision to provide CA and designate SDO in your region, all procurement is centalized in the Head office, In the meantime your central office provided a protective measures in form of CA to take care of your region contingencies needs, pending the receive of allocation for supplies etc, from the central office. bounce
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Re: RE: Is a Regional Head required to make APP?

Post by mindlex on Wed Mar 03, 2010 8:40 am

guys thanks so much for the inputs and ideas shared. Learned soooo much from you. Smile Smile

Our COA's take on the matter:

1. make its ownn APP, submit a PPMP to the central office, and create its own BAC even without the authority and directive from the head office.
2. That the office is a procuring entity since it is receiving cash despite the designation of the regional head as a Special Disbursing Officer and despite the minimal amount involved.

I noticed that there are differing opinions on the issue. Personally, I am more inclined to agree on the view that the Regional Office need not prepare its own APP and BAC but that it must be informed by the Central Office as to what are the allowable items to be purchased and the mode of procurement based on the APP prepared by the Central Office. However, since COA insists on the Regional Office to prepare its own APP, could the office still question it or should we just follow their recommendations? Anyway, it is ultimately the COA who sort of has the "last say" on the matter.
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Re: RE: Is a Regional Head required to make APP?

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