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SOP Library

SOP NO: HR-PA01 (List of Exhibits/Attachments)

Mission: Finance and Administration

Area: Human Resource (HR)

Activity: Personnel Administration (HR-PA)

Title: Fidelity Bond Application/Cancellation

Date Approved/Issued: 04/14/1989

Date Effective: 01/01/1989

Digest:

I. TERMS OF REFERENCE
A. Rationale
B. Objective
C. Scope
D. Basis

II. IMPLEMENTING GUIDELINES

1. Necessity to Bond NFA Accountable Officials and Employees


NFA accountable officials and employees shall be bonded to
ensure: (1) faithful performance of all duties imposed by law upon
them; (2) faithful accounting of all funds and public property
coming into their possession, custody or control thru
appropriation, collection, transfer or otherwise; (3) lawful payment,
disbursement and expenditure or transfer of all such funds or
public property under their custody and control as accountable
officers or employees.
2. Purpose of Fidelity Bond
The Fidelity Bond shall be for the purpose of replacing
defalcations/shortages and for payment of court fees incident to
civil proceedings brought against the defaulting accountable
officer to recover sums paid by NFA on their account.
3. Bondable NFA Officials and Employees
3.1 Regular NFA employees who are appointed or designated to
the following accountable positions and are actually performing
the functions attached to these positions:
a. Warehouse Supervisor II
b. Cashiers
c. Sr. Disbursing Officers/Disbursing Officers
d. Supply Officers/Property Custodians
e. Other positions holding accountabilities (ex. regular
employees designated to act as special collecting or
disbursing officers)
3.2 Plant Engineers, Sr. Mechanical Plant Operators and MPO's II
shall be bonded as to their accountabilities for stocks-in-process.

3.3 Bonding of NFA Central Office and Field Office Key Officials,
either appointed or designated to these positions, shall be
undertaken only upon the discretion of COA based on the officials
needs to perform specific functions similar to those of the
identified accountable positions.

3.4 Casual employees who are to be bonded shall include only


those designated as Special Disbursing Officers for grains
procurement operations in case of urgent need in the exigency of
the service as authorized by the Regional Director.

3.5 No bondable official/employee shall be allowed to hold


accountabilities unless his bond has been approved.
4. Appointment or Designation of NFA Accountable Officials and Employees
4.1 The head of office shall exercise utmost discretion in
recommending the appointment or designation of officials and
employees to accountable positions. They shall see to it that
those appointed or designated to such accountable positions are
unquestionable conduct and character as well as of proven
integrity.

4.2 Designation shall be made in any of the following


circumstances
a. resignation or transfer of the incumbent
accountable officer/employee to another position
without immediate replacement for that position.
b. no existing positions in the plantilla of the
office/directorate but same are needed for particular
purposes.
c. leave of absence of the incumbent for at least two
(2) months or indefinite leave due to suspension for
any criminal or administrative charge.

4.3 Designations to accountable positions shall be effected with


the issuance of Special Order by the Administrator or the
Regional Director for Central Office and Field Office, respectively.
Request for Special Order shall be made at least one (1) month
prior to assumption to duty. Assumption to duty shall not be earlier
than the approval of his bond.
5. Cancellation of Fidelity Bonds

5.1 Fidelity Bonds shall be cancelled due to any of the following


reasons:

a. retirement/resignation from service of the incumbent


b. separation for cause from the service
c. designation to non-accountable positions
d. change in position title thru promotion/demotion
e. termination of Special Order for specific project
f. relief from accountability (especially that resulting
from the transfer of the accountable officer to another
region).
5.2 Cancellation of fidelity bonds of bonded officials/employees
shall be immediately effected when the accountable officers are
relieved of their accountabilities. Accountabilities shall be
liquidated once the accountable officer ceases to act as one. The
head of office shall speedup the liquidation process to ensure
prompt clearance of the concerned official/employee.

5.3 The head of office shall see to it that officials and employees
whose fidelity bonds have been cancelled are relieved of their
accountabilities.
6. Cash Responsibility and Amount of Bond
6.1 The schedule of bonds necessary to cover the accountability
and responsibility of accountable officers shall be as follows:

6.3 If an accountable officer/employee has both cash and property


responsibilities, only one bond is necessary to cover both
accountabilities. However, the amount of the bond shall be fixed
at the total amount to be arrived at in accordance with the
foregoing schedule. The application shall reflect the individual
accountability for cash and property responsibility.

6.4 The cash and property responsibilities handled by an


employee/officer shall not exceed the amount of bond covering
the accountabilities. Whenever the amount of the bond is
exceeded, the accountable officer as well as his immediate
supervisor shall take immediate and necessary actions to have
the excess transferred from his possession.

6.5 Grains stocks and empty sacks shall be classified under


property accountability. Computation shall follow the formula used
for supplies and materials.
7. Premiums
7.1 The premium chargeable for insurance in the Fidelity Fund
shall be at the rate of 1/2 of 1 per centum per annum payable
semi-annually in advance on the first day of January and July of
each year.

Computation of the annual premiums shall be as follows:

Example : Amount of Bond = P10,000

Premium Payable per Year = 1/2 (.01 x P10,000)


= P50.00

Premium Payable per Semester = 1/4 (.01 x P10,000)


= P25.00

7.2 All premiums on bonds shall be paid for a full semester,


regardless of the date of effectivity and cancellation of the bond
during semester.

7.3 No rebate or refund of premiums paid shall be made from the


Fidelity Fund for any cause whatsoever. However, in case there
has been an overpayment, the Bureau of Treasury (BTR) shall be
informed in writing in order that credit will be given in the
succeeding bill (Section 10, Rule VI of BTR Memorandum Circular
No. 1-71).

7.4 Payment of premiums shall be authorized by the Assistant


Administrator for Corporate Administration/Regional Director.
8. Amount of Accountability
The amount of accountability shall be determined by the head of
office on the following:

Accountable
Officer/Employee Accountability

a. Supply Officer/ - Total value of all supplies/materials and


Property Custodian accountable forms under accountability.
This shall be based on the average monthly
inventory level during the last year computed
based on the book value of supplies/
materials.

b. Warehouse - Total value of stocks based on the average


Supervisor II monthly balance of the warehouse of the
previous year. If the WS II handles more than
one warehouse, the total shall be determined
for all warehouses handled. Costing shall be
based on the book value of stocks.

c. Cashier/Sr. Disbursing - Total cash accountability.


Officer/Special Collecting
or Disbursing Officer

d. Plant Engineer/ - Based on the average weekly balance of the


Sr. MPO/MPO II previous year of stocks in process at the
Ricemill/Drier/Silo being handled (refer to
SOP No. GM-PG-01). Costing of stocks shall
be based on book value.
9. Filing and Processing of Fidelity Bond Application
9.1 All bondable officials and employees shall be required to
submit their Application for Bond (General Form No. 58A - Exhibit
1) and Request for Bonding (General Form No. 57A - Exhibit 2) to
the Administrative Officer/Assistant at least three (3) weeks prior
to holding of accountability.

The Administrative Officer/Assistant shall check the completeness


of the forms and their supporting documents which are as follows:

a. Certified xerox copy of the approved appointment;


b. Certified xerox of the designation to act as an accountable
officer;
c. Latest Statement of Assets and Liabilities; and
d. Picture (2" x 2") per application form.

9.2 The request for bonding and application for bond shall be
signed by:

Authorized Official Accountable Officer

a. Director of Head of Office concerned Central Office employee


b. Regional Director Regional Office employee
c. Provincial Manager Provincial Office employee

The Director for Treasury and Fund Management shall sign the
"First Endorsement" portion of the request for bonding of Central
Office accountable officers and employees.

The Corporate Auditor/Regional or Provincial Auditor shall sign


the "Second Endorsement" portion of the request.

9.3 The determination of the amount of accountability and the


recommended amount of bond shall be the responsibility of the
Chief of the Cash Division/Regional or Provincial Accountant.

The amount of the bond shall be fixed by the COA resident


auditor after verification and processing of the forms.

9.4 The duly accomplished/processed forms with their supporting


documents shall be filed by the designated employee of the Cash
Division/Regional or Provincial Administrative Officer with the
proper BTR office:

a. Fidelity Bond Division, BTR : For Central Office and


Metro Manila Office
Accountable Officers

b. Treasury Fiscal Officer III or


I assigned in the Province (Annex A) : For field office accountable
officers

Follow - up of requests/applications shall be made by the same


responsible employees.

9.5 Field Office request/applications shall be forwarded by the


Treasury Fiscal Officer III/I to the Treasury Regional Director for
approval. Notice of the approval together with the approved bond
shall be transmitted to the NFA through the Treasury Fiscal
Officer III/I.

Defective request/applications shall be returned for correction.


10. Bond Cancellation
10.1 For bond cancellation, only appropriate portions of the
General Form No. 57(A) shall be accomplished. No supporting
documents are required. (Refer to Annex B for detailed
instructions).

10.2 The signatories to the bond cancellation request shall be


same officials designated to sign the request/applications for
bonding.
10.3 Filing of bond cancellation request shall be made by the
same NFA employees with the same Treasury Officers provided
in 9.4.
11. Copy Distribution of Forms
11.1 Application for Bonding (General Form No. 58A) shall be
accomplished in four (4) copies both for Central Office and field
offices.

Copy 1-2 - Treasury Office concerned


3 - Cash Division/Regional or Provincial Administrative Section
4 - COA Resident Auditor

11.2 Request, for Bonding/Cancellation of Bonds (General Form


No. 57A) shall be accomplished in the following number of copies:

a. Central Office
Copy 1-4 - Fidelity Bond Division
5 - Corporate Auditor

Copies 2 to 4 validated by the Fidelity Bond


Division shall be returned to the NFA and
distributed as follows:

Copy 2 - Cash Division


3 - Central Office Accounting Division
4 - Directorate or Office of the bondable
employee
(xerox copy may be provided the bondable
employee)
b. Field Office
Copy 1-4 - Treasury Fiscal Officer III/I
5 - Regional/Provincial Auditor

The Treasury Fiscal Officer III/I shall returned


the validated request to the NFA to be
distributed as follows:

Copy 2 - Regional/Provincial Administrative


Section
3 - Regional/Provincial Accounting Section
4 - Bondable employee.

11.3 The same division/section shall be provided with copies of


the BTR Notice of Approval of
the bond application./cancellation.
12. Adjustment of the Amount of Bond/Change of Incumbents
12.1 The existing amount of bond of the bonded officer employee
shall be recommended for adjustment in case there is a
substantial increase/decrease in the total accountability.
Request for such adjustment shall be made using
Form 57A - Request for Bond Application (no
supporting documents required) indicating the
updated amount of accountability and bond. The
remarks portion should clearly state
Increase/Decrease of accountability from
____________ to _________________. Hence,
additional billing by the Bureau of Treasury shall be
based on the increment.
12.2 In case of change of incumbents and there is simultaneous
bond application and cancellation for reasons already specified
(e.g. resignation and immediate appointment/designation for the
same accountable position) only one form (Form 57A) shall be
used for both request. The application portion shall be for the
incoming accountable officer and the cancellation portion for the
outgoing accountable officer. This shall require attachment of
Application for Bond (Form 58A) for the incoming accountable
officer including all other documents specified in 9.1.
The remarks portion shall state change of incumbent hence, there
shall be no additional BTR building.
13. Financial Management
13.1 Since payment of the fidelity bond premium of field offices
has been decentralized to the regional office level, corresponding
budget/allotment shall be provided to the regional offices. The
annual operating budget request of regional offices shall include
expenses for fidelity bond premiums for the region.

Payment shall be made at the BTR regional office (Annex A) by


the Regional Administrative Officer (RAO)

13.2 Central Office directorates/offices, with identified bondable


positions shall be allotted budget for the fidelity bond premiums
based on submitted budget request. Budget for premiums of the
other directorates/offices shall initially be allotted to the DTFM.
Subsequent charging of the expenses to the concerned
directorate/office shall be effected once payment is made.

13.3 The Directorate for Treasury and Fund Management (DTFM)


shall facilitate the implementation of the BTR decentralization
policies on the processing of application/cancellation of fidelity
bonds and payment of premiums.

13.4 Basis for the payment of the fidelity bond premiums shall be
the Treasury Bill Form No. 32 (Exhibit 3) supported by the
Statement of Account (Exhibit 4). No payment shall be made
unless these documents are received by the NFA.

Prior to payment, the bill, statement of account and list of bonded


accountable officers shall be checked as to correctness of the list
of bonded positions, amount of bonds, names of the incumbents
and the risk numbers. This shall be the responsibility of the Cash
Division/regional office administrative section as coordinated with
the Central Office Accounting Division/regional office accounting
section. The RAO shall check the data from the Report on
Bonded Officers/Employees and Bonds Cancelled submitted by
the provincial offices.

13.5 Any discrepancy shall be first coordinated with the Bureau of


Treasury, Corrections/changes as presented to the BTR shall be
made on all copies of the statement of account and bill. The
original copies shall be returned to the BTR together with the
check for the premiums.

The Cash Division/Administrative and accounting units/COA shall


be provided with copies of the Statement of Account and Treasury
Bills.

13.6 Payment of the fidelity bond premiums shall be effected thru


the usual disbursement voucher system.

Preparation of the disbursement vouchers and attachment of the


required supporting documents shall be the responsibility of the
Cash Division/regional administrative section.

13.7 The accounting entries to take-up payment of the fidelity


bond premiums shall be as follows:

Central Office:

DR: Other services - fidelity


Bond Premium xxx
CR: Vouchers Payable xxx
#

DR: Vouchers Payable xxx


CR: Cash in Bank xxx
#

Regional Office:
DR: Other Services - Fidelity
Bond Premiums * xxx
POA** xxx
CR: Vouchers Payable xxx
#

Provincial Office:

DR: Other Services - Fidelity


Bond Premiums xxx
CR: ROA xxx

* Premiums of Regional Office Accountable Officer


* * Premiums of Provincial Office/Accountable Officer

The BTR official receipt shall be evidence receipt of


the check representing payment of the premiums.
14. Reporting/Records Management
14.1 The list of bonded officials/employees shall be
maintained and updated by the Cash
Division/Administrative Section in order to determine
additions/deletions in the list and needs to increase
existing bonds based on special orders, request for
application/cancellation/adjustment of bonds,
memoranda and other management instructions. The
Cash Division/Administrative Section shall be
furnished with copies of management instructions
involving bonding policies.

14.2 A Report on Bonded Officers/Employees and


Bonds Cancelled (Exhibit 5) shall be certified by the
Provincial Administrative Officer (PAO). The report
noted by the Provincial Manager shall be submitted to
the RAO on or before June 22 and December 22 of
each year. This shall be used by the RAO in checking
the correctness of the BTR bill.

The PAO shall inform the RAO of any changes in the


report prior to the premiums payment (January 1 and
July 1 of each year).

14.3 A consolidated report noted by the Regional


Director shall be submitted to DTFM and HRMD not
later than January 7 and July l7 of each year.

14.4 The Cash Division/Administration Section shall


maintain index cards (Exhibit 6) which shall be
prepared per individual accountable officer. Same
shall be updated based on incoming approved
request for bond/cancellation. This shall be reconciled
with the BTR statement of account.
15. Failure to File/Cancel Fidelity Bond
15.1 The Provincial Manager/Regional Director/Head
of Office shall ensure that proper filing of
application/cancellation of bonds is effected.
15.2 In case of failure to comply with the herein
bonding policies, the responsible officials/employees
shall be made liable for any losses or expenses that
maybe incurred by the NFA on account of such failure
without prejudice to any administrative actions that
may be taken against them.
16. Claims Against the Fidelity Insurance Fund
16.1 Claims against the fidelity bonds shall be filed
only after all possible means to recover the amount of
loss from responsible bondable officer have been
declared by competent authority. (Section 3, Rule VII,
TMC NO. 1-71).

16.2 Claims against the fund shall not be allowed


when a bonded officer has been found short in his
accountability and was not removed or relieved of the
duties thus giving him another opportunity to
embezzle, which he did and because the subject of
the claim. (Section 5, Rule VII, TMC No. 1-71).

Defaulting accountable officers shall be relieved of


their duties as such by the head of office concerned
upon recommendation of COA/IAD/other authorized
representatives who conducted the examination of
accountabilities.

16.3 Proceeds of claims from the fund may be applied


for the payment and/or settlement of unpaid bond
premiums of the NFA. (Section 6, Rule VII, TMC 1-
17).

16.4 COA shall notify in advance the BTR regarding


defaulting officers even before actual loss has been
established.

16.5 Based on the findings and recommendation of


COA/IAD/other authorized examiners, the Directorate
for Enforcement and Investigation (DEI) provincial
investigators shall conduct the investigations and
recommend filling of cases. The Directorate for Legal
Affairs (DLA/Senior Legal Officer shall institute legal
proceedings against defaulting officers.

16.6 The DLA shall inform the DTFM regarding the


status of court cases for purposes of effecting claims
from the Fidelity Fund, i.e. court decisions,
whereabouts of defaulting officers no longer known,
declaration of insolvency, etc....

16.7 The DLA furnishes the DTFM with the following


documents to support claims from the Fidelity Fund:

a. Court Decision
b. Declaration of Insolvency
c. Certification from the court having jurisdiction over
the case that
whereabouts of the respondent can not be
established.
d. Certification from the Registry of Deeds in the place
of residence
of the bonded employee that there are not properties
registered
under his name.

The Senior Legal Officer shall submit copies of these


documents to the DTFM thru the DLA.

16.8 The DTFM shall forward all documents required


for the claims directly to the Chairman of the
Commission on Audit for recommendation. Approval
of the claim in full or in part shall be made by the
Secretary of Finance based on COA
recommendation.

The BTR shall effect payment based on the


authorization of the Secretary of Finance.

Status of cases filed in the field offices shall be


reported to the DLA.
III. RESPONSIBILITIES

1. Bondable NFA Officer/Employee


1.1 Accomplishes General Form 58 (A) to apply for fidelity bond
and General Form 57 A (Request for bonding and/or Cancellation
of Bond)/Prepares required supporting documents.
1.2 Submits the accomplishes forms to the respective
Administrative Officer/Assistant (AO/AA) together with all the
required documents.
2. Head of Office
2.1 Recommends designation and appointment of accountable
personnel/Request for Special Order from the Administrator or
Regional Director.
2.2 Determines the total amount of accountability and bond
requirement.
2.3 Signs Request for Bond and/or Cancellation of Bond of
Accountable Officer/Employee.
2.4 Recommends to DEI investigation of defaulting bonded
employees under his jurisdiction.
2.5 Notes Report on Bonded Officers/Employees and Bonds
Cancelled.
2.6 Ensures compliance to the herein policies relative to bond
application/cancellation, payment of premiums and effecting
claims against the Fidelity Insurance Fund.
3. Administrative Officer/Assistant
3.1 Identifies all bondable officials/employees of the branch/office.
3.2 Determines the completeness of the application forms and the
supporting documents submitted by the applicant.
3.3 Secures First Endorsement and Second Endorsement of the
bond request.
3.4 Forwards documents to the Cash Division for transmittal to the
Bureau of Treasury (C.O.) and to Treasury Fiscal Officer III/I
(F.O.)/Follow-up status of request for bond
application/cancellation.

3.5 For Provincial Administrative Officer:

Submits Report on Bonded Officers and Employees noted by the


Provincial Manager to the Regional Office on or before June 22
and December 22 of each year.

For Regional Administrative Officer:

Submits a Consolidated Report on Bonded Officers and


Employees to DTFM and HRMD not later than January 7 and July
7 of each year.

3.6 For Regional Administrative Officers:

Reviews BTR Statement of Accounts/Reconciles the BTR bill


against index card and list maintained/Coordinates any
discrepancy with the Treasury Fiscal Officer III or I/Effects
necessary amendments to correct bill/Prepares disbursement
voucher for payment of premiums.
4. Provincial/Regional Accountant
Evaluates all bond applications forwarded by the Administrative
Officer/Assistant as to the correctness of accountabilities and
amount of bond.
5. Chief, Cash Division
5.1 Secures First and Second Endorsement of Central Office
bond request.
5.2 Reviews all request for bond application/cancellation
submitted prior to endorsement to BTR/Monitors the status of
request with the BTR.
5.3 Informs concerned office regarding approved request for bond
application/cancellation.
5.4 Maintains index cards of Central Office bonded personnel/At
the end to the semester, prepares Master List of bonded
personnel based on updated index cards.
5.5 Reviews Statement of Accounts submitted by the BTR and
reconciles same with the Master List/Coordinates any discrepancy
with the BTR.
5.6 Prepares Central Office voucher for the payment of Fidelity
Bond premiums based on the corrected statement of accounts.
5.7 Files claims against the Fidelity Insurance Fund/Monitors
status of claims.
5.8 Ensures compliance to the herein policies.
6. Director for Treasury and Fund Management
6.1 Signs on the First Endorsement portion of Central Office
request for bond applications/
cancellation.
7. Director for Enforcement and Investigation/Provincial Investigator

7.1 Initiates investigations and recommends filing of cases against


defaulting bonded officials/employees.

8. Director for Legal Affair/Sr. Legal Officer


8.1 Institute legal proceedings.
8.2 Informs the DTFM regarding status of court cases against
defaulting offices and coordinates with the DTFM for purposes of
effecting claims against the Fidelity Fund/Furnishes the DTFM
with copies of findings, examinations, court decision, and other
documents required for filling of claims.
9. Regional/Provincial Auditor
9.1 Evaluates and processes request for bond application and
cancellation/Determines the amount of bond of every bondable
officer or employee.

9.2 Signs under the Second Endorsement portion of the bond


request to signify that same has been verified and processed.
10. Corporate Auditor

10.1 Signs the "Second Endorsement" portion of the C.O. request for
bond application/cancellation after processing and verification.

10.2 Recommends approval of the NFA claims against fidelity bonds of


defaulting bonded officers/employees to the Secretary of Finance thru
COA Commission Proper.
IV. FLOW CHART
Top Page
EXHIBITS
Annex A - Bureau of Treasury Directory
Application for Bond of Accountable Officials and Employees
General Form No. 57(A)
Treasury Form No. 32
Request for Bonding
Report on Bonded Officers/Employees
Statement of Account (Fidelity Bond)
Fidelity Bond Index Card
Guidelines in Accomplishing Fidelity Bond Forms
SOP Library
SOP NO: HR-PA08 (List of Exhibits/Attachments)

Mission: Finance and Administration

Area: Human Resource (HR)

Activity: Personnel Administration (HR-PA)

Title: Revised SOP on Domestic Travel

Date Approved/Issued: 05/10/1999

Date Effective: 05/17/1999

Digest:

I. TERMS OF REFERENCE
A. Rationale
B. Objective
C. Scope
D. Basis

II. IMPLEMENTING GUIDELINES

A. Travel
1. Travel shall mean authorized absence from the permanent
official station (the place where the office or regular place of
business/work of the officer or employee concerned is
permanently located) of the personnel for less or more than a day
on official business.

2. The destination of the travelling employee shall be more than


50 kilometers from the permanent official station.

3. For Central Office and Metro Manila Office personnel, travels to


localities defined by Presidential Decree No. 824/COA Circular
No. 76-8 to be part of Metropolitan Manila Area shall be herein
considered as trips.

B. Travel Authority
1. The Specifications of Authority for approval of travel shall be as follows:

RECOMMENDING
APPROVAL APPROVAL

CENTRAL OFFICE

a. Travel of Deputy Administrators and Administrator

not more than one calendar month Administrator

b. Travel of Assistant Administrators

seven (7) calendar days and below Dep. Adm. concerned

more than 7 days but not more than


1 calendar month Dep.Adm. Administrator*
concerned
c. Travel of Department Managers

seven (7) calendar days and below Asst Adm. concerned Dep.Adm.concerned AAFA
(for Staff Offices) DAFA (for Staff Offices)

more than 7 days but not more than Dep. Adm. concerned Administrator*
1 calendar month DAFA (for Staff Offices)

d. Asst.Dept. Managers & Division Chiefs

seven (7) calendar days and below Dept. Manager Asst.Adm. concerned AAFA (for
Staff Offfices)
more than 7 days but not more than Dept. Manager/ Dep.Adm.concerned;
1 calendar month AA concerned; DAFA (for Staff Offices)
AAFA (for Staff Offices)

e. Rank and File Employees of Departments

not more than 1 calendar month Dept. Manager Asst.Adm. concerned;


AAFA (for Staff Offices)

f. Employees of the Asst. Adm./Dep. Adm. Office

not more than 1 calendar month Head of Staff Asst.Adm. concerned/


Dep.Adm. concerned

g. Employees of the Administrators Office


not more than 1 calendar month Special Assistant

REGIONAL OFFICE/FIELD OFFICE UNITS

a. Travel of Regional Managers

a.1 Within the Region Regional Manager

a.2 Outside the Region

not more than 1 calendar month Dep.Adm. concerned Administrator*

b. Travel of Asst. Regional Managers, Provincial Managers, Chief Grains


Operations Officers, Adm. Officers V

b.1 Within the Region

not more than 1 calendar month Asst.Regional Manager Regional Manager*

b.2 Outside the Region

not more than 1 calendar month Regional Manager* Dep.Adm.concerned


(depending on purpose
of travel)

c. Travel of PMs within the Province Provincial Manager

d. Travel of Rank and File Employees

d.1 Within the Province

not more than 1 calendar month Asst.Provincial Manager Provincial Manager*


or OIC*
d.2 Within the Region

seven (7) calendar days


and below Provincial Manager* Asst. Regl. Manager
OIC*
more than seven (7) days
but not more than one (1)
calendar month Asst.Regl. Manager Regional Manager*

d.3 Outside the Region

seven (7) calendar days


and below Provl Mgr./Asst. Regional Manager*
Regional Manager
more than seven (7) days
but not more than one (1)
calendar month Regional Manager Asst.Adm.concerned
(depending on the
purpose of travel)

*Official next lower-in-rank can execute the required action in the absence of the
authorized official.
2. All local travels of more than one (1) calendar month of an
official/ employee is subject to the approval of the President of the
Philippines or official duly authorized by him (EO 248).
3. Should it be extremely necessary to extend the travel, the
head of the destination office shall recommend extension of
travel. A request for said extension and another Travel Authority
covering the additional days of travel shall be prepared and shall
be approved by the same officials designated in the
aforementioned specifications of authority. The level of authority
shall cover the total number of days of travel considering the first
travel authority and the extension requested. For reference
purposes, the request for extension shall reflect previous Travel
Authority Number and number of days of travel previously
authorized.
Wire Authority for the extension shall include authorization
for additional travel cash advances to be paid at the
destination office. A copy thereof shall be furnished DAS
(C.O.)/Finance Section (F.O.) and COA for record
purposes.
C. Travelling Allowance
1. The travelling expenses of personnel regardless of rank and
position shall be in the amount of THREE HUNDRED PESOS
(P300.00) per day divided into four units corresponding to
breakfast, lunch, dinner and lodging. Each unit shall be
determined in accordance with the following :

a. Breakfast P 50.00 When leaving the permanent official


station before or returning thereto after 7:00am.

b. Lunch 75.00 When leaving the permanent official station


before or returning thereto after 12:00 noon.
c. Dinner 75.00 When leaving the permanent official station
before or returning thereto after 7:00 pm.
d. Lodging 100.00 For overnight accommodation .

2. The top three officials of the agency, namely: the Administrator,


the Deputy Administrators, and the Assistant Administrators shall
be entitled to actual reasonable travelling expenses duly
supported by receipts. An itemized list of expenses incurred in
connection with the official travel of the concerned official shall be
prepared by the destination office. The itemized list, duly
acknowledged/confirmed by the concerned official, together with
certified photocopies of receipts, shall be submitted to CO-DAS
for billing purposes. CO-DAS shall charge the expenses to the
Office of the Official concerned in accordance with the Interbranch
payment of expenses and billing procedures.
3. Officials and employees whose permanent official station is
within the Metropolitan Manila
Area (MMA) shall not be allowed the travel expenses herein
authorized for their travel/assignment to places within MMA.
The same restriction shall also apply to those in cities and
municipalities outside MMA when assigned to places within
the city or municipality wherein their permanent official
station is located.
4. Claims for payment of travel expenses for official
travel/assignment to places within the fifty (50) km radius from the
last city or municipality covered by the MMA, in the case of those
whose permanent official station is in MMA, or the city or
municipality wherein their permanent official station is located, in
the case of those outside MMA, shall be allowed only upon
presentation of proof, duly supported by bills or invoices with
official receipts of expenses incurred, that they stayed in the place
of their assignment for the whole duration of their official travel. If
they commute daily from the place of their assignment to the
place of their residence or permanent official station, they shall be
allowed only the reimbursement of actual fare at the prevailing
rates of the authorized mode of transportation from the permanent
official station to the destination or place of work and back, and
reasonable cost of actual meal allowance, but in no case shall
exceed the TWO HUNDRED PESOS (P200.00) travel allowance
herein authorized (Section 6, Executive Order No. 248).
5. For uniform and consistent implementation of the above
provisions, meal allowance of EIGHTY PESOS (P80.00) per day
corresponding to two (2) meals of FORTY PESOS (P40.00) each,
shall be granted to travelling employees authorized to commute
daily from their place of residence or permanent official station to
their temporary place of assignment which is within the fifty (50)
km radius from the last city or municipality covered by the MMA in
the case of those whose permanent official station is in the MMA.
The same policy shall apply to travelling field office personnel who
are authorized to commute daily from their place of residence or
permanent official station to their temporary place of assignment
which is within the fifty (50) km. radius from the last city
municipality where their permanent official station is located.
The meal allowance of P80.00 per day and the
reimbursement of actual fare at the prevailing rates of the
authorized mode of transportation from the permanent
official station to the destination or place of work and back
shall in no case exceed TWO HUNDRED PESOS
(P200.00). The presentation of bills and receipts covering
the cost of meals shall not be required except for the
transportation tickets which shall form part of the evidence
of the actual travel taken.

6. To preclude double payment of expenditures, the travel allowance


prescribed herein shall not be allowed in cases where the fare paid for
transportation includes meals and quarters enroute, or where meals and
lodgings are paid for or furnished by the government.

D. Transportation Expenses
1. The mode of and class of transportation to be taken shall be
that which will be most advantageous to the government from the
standpoint of economy and efficiency. Only ordinary public
conveyance or customary modes of transportation shall be used.
Exceptions may be made in meritorious cases and justified by
prevailing circumstances. Relative to this policy are the following:

1.1 Travelling employees shall always take public transport facilities.


Only when it is proven more economical should NFA service vehicles be
used. The Department Manager for General Services/Regional
Manager/Provincial Manager shall consider this policy in the approval of
Vehicle Requisition Slip (VRS) of travelling personnel.
In consonance with Memo96 ODAFA-F-001
dated June 24, 1996, any VRS for the
ferrying of NFA officials and employees to
and from the Manila Domestic Airport
should henceforth be accompanied by a
copy of the Travel Authority . GSD shall not
provide any service vehicle if the TA
indicates that the mode of such travel to or
from the said airport is by taxi.
1.2 No employee shall be allowed to use air transportation
when the point of destination (within Luzon) can be reached
by land transportation, except in emergency situations.
1.3 Exemption to the foregoing policies shall be authorized
by the Deputy Administrator for Finance and Administration.
In his absence, the Deputy Administrator for Operations
shall approve the request for exemption.
2. The amount of transportation allowance shall be the actual fare at the
prevailing rates of the authorized transportation from the permanent
official station to the destination or place of work or assignment in the
field and back, plus other expenses such as transportation from office or
residence to points of embarkation and from points of debarkation to
office or temporary residence in the place of assignment in the field and
return.
It shall not include local transportation and other expenses
after arrival in the office or temporary residence in the place
of assignment in the field which are covered by the
travelling allowances.
3. In cases where service vehicles are used in the travel, the
officials and employees concerned shall not be entitled to the
equivalent transportation fares.
4. Fuel shall not be issued to privately owned-motor vehicles.
Likewise, no reimbursement for the cost of gasoline and oil shall
be allowed where a private vehicle is used for the official travel.
However, reimbursement of the equivalent cost of the customary
mode of transportation may be allowed provided prior
authorization for the use of a private vehicle is secured as
reflected in the travel authority.

5. Collection of taxi fare expenses shall be guided by the following:

a. The travelling employee shall be allowed to collect


actual taxi fare from residence to airport/bus
terminal/pier and vice-versa provided the travelling
employee did not use an NFA service vehicle.
b. For travels with service vehicles, the maximum of
P60.00 taxi fare from residence to pick-up points and
from drop-off points to residence shall be allowed to
employees whose travels are covered by a TA involving
more than a full days absence from the official station.
c. The travelling employee shall also be entitled to actual
transportation fare from airport/bus terminal/pier to
temporary place of assignment and vice-versa.

d. Collection of taxi fares of more than P 60.00 shall be


supported by an RER.

E. Day-Off
Pursuant to Article VI, Sec. 13 of the NFA Collective Negotiation
Agreement (CNA), NFA employees are entitled to one (1) day-off for
travels of four (4) days up to fifteen (15) days and two (2) days-off for
travels exceeding fifteen (15) days, subject to the following conditions :
1. The employee is not holding a managerial position/designated to
perform managerial functions starting with Provincial Managers/Division
Chiefs;
2. Travel is inclusive of Saturdays and Sundays. Hence,
employees whose travel lasts
from four (4) to five (5) days but falls on weekdays shall not be entitled
to a day-off;
3. Travel is authorized in connection with the performance of
official business/mission. Travels which are authorized/granted as
an incentive or for humanitarian considerations (i.e., special
privilege for recognition of services, assumption of position after
reassignment, request for medical treatment due to a work-
connected injury, etc.) which are usually on official-time basis only
shall not be included;
4. Day-off must be availed of immediately after travel except when
services are needed in the exigency of the service.

F. Travelling Expenses of Transferred Personnel


1. Any official or regular employee transferred from one duty
station to another due to the exigency of the service shall be
entitled to collect travelling allowance corresponding to the first
fifteen (15) days if the new place of assignment is outside the
region and seven (7) days if within the region. This shall be
granted to cushion the impact of the relocation on the personnel
transferred and shall be given in lieu of the relocation allowance
previously granted in such a case.
2. However, the travelling allowance shall not be granted under
the following cases:
a. The personnel requested for the transfer due to personal
reasons.
b. The personnel was recalled to the Central Office for
reason of relief due to administrative/criminal charges filed
against him/her.

3. In addition to the travelling allowance, the transferred


official/regular employee shall also be entitled to actual and
necessary expenses which shall include the following:
a. transportation expenses of the official/regular employee,
his spouse and children below 21 year old.
b. transfer cost of baggages and household effects but not
exceeding 3,000 kilograms.
4. Actual and necessary expenses incurred shall be reimbursed to
the concerned official/regular employee and shall be duly
supported by receipts. In no case shall these be collected in
advance.

5. A transferred personnel shall be given one (1) year from


assumption to duty within which he must relocate his family.
Otherwise, the privilege shall automatically be forfeited, that is, all
expenses that will be incurred should the concerned personnel
decide to relocate at a later time shall be personally borne by him.
Relocation shall be done only once for the entire household.

G. Documentation

1. Travel Authority -Exhibit A (Exhibit 1)

1.1 Authority for travels involving one full day or more shall be documented
with this form. The Travel Authority shall be signed by the officials designated
per specifications of authority herein provided. Travel Permit is prepared for
less than one full-day.

1.2 The TA shall reflect the following information:


a. TA Number/Date of TA

b. Name/Position/Department/Office of the travelling


personnel

c. Destination/Duration/Purpose of Travel

d. Itinerary of Travel - date, places to be visited, time


of departure and arrival, means of transportation and
allowable expenses such as travelling allowance,
transportation expenses, porterage and airport fees

e. Wire Authority Number and Date - for travels


requiring C.O. Authority/Extension of Travels

f. Budget to which the travel expenses shall be


charged

g. Non-entitlement of the travelling personnel to


subsistence, lodging and transportation expenses in case
such are paid by the NFA under a project with an approved
budget or under a project which is being paid by other
government agencies or private entities.

h. Certification by the recommending official that the


itinerary presented was reviewed, the travel is
necessary to the service, the period covered including
travel time is reasonable and the expenses claimed
are proper.

To avoid delay of processing and approval of


the TA, the travelling employee should
accomplish all requirements and the same shall
be duly signed by the proper authority.
1.3 The TA shall be prepared by the travelling personnel in four
(4) copies and shall be distributed as follows:

Copy 1 - COA
2 - DAS-CIAD/Finance Section
3 & 4 - Employee (1 copy to be attached to the liquidation voucher.)

AA - XX - XX - XX
''''
' ' ' '------- Series for the month
'''
' ' ' -----------------------------Month
' '---------------------------------------------- Year
'
'------------------------------- Office authorizing the travel

Example: AO-98-01-01 First travel authorized by the Administrator for the


month of January for the year 1998

1.4 A list of travels authorized shall be maintained by the offices


concerned. This shall reflect the date when the travel was
authorized, TA/Wire number and date, name/position/office of the
travelling personnel and place/duration/purpose of travel.
Authorized extension of travels shall also be reflected in the list.
1.5 No official or employee shall be allowed to travel without the
approved TA. Any employee who travels without the duly
approved TA shall not be reimbursed his travelling expenses.
1.6 Wire authorities (travels subject to Central Office clearance)
shall be reflected and attached to the TA as part of its
documentation. The travel form shall be signed by the designated
officials based on the wire authority.

2. Mission Order
2.1 This shall refer to the order from the Administrator to
undertake a particular assignment the purpose or objective of
which can only be achieved most effectively if it is kept as
confidential and unknown to all other parties. Audits, background
investigations and the like are activities covered by mission
orders.

2.2 In consonance with IAD unnumbered memo 93 dated 27 September


1993, the Administrator officially delegated the IAIPD Director (now the IAS
Department Manager) to be the approving signatory to the Mission Order for
IAIPDs (now the IAS Department) internal auditors and investigators.

3. Disbursement Voucher (DV-Exhibit 2)


General Form No. 5A Disbursement Voucher (DV-Exhibit 2)
shall be prepared by the travelling employee in making travelling
expense claims against the NFA. The travelling employee shall
submit this filled up form together with all the travelling documents
needed for processing of claim to DAS- CIAD/Finance Section. In
case the travel is requested by another department/office, the
travelling employee shall put in the particulars of payment portion
of the DV the department/office where the cash advance will be
charged. The Department Manager/Provincial Manager of the
department/offices where the cash advance will be charged shall
sign the TEV and liquidation vouchers for both reimbursements
and refunds. DV shall be prepared in six (6) copies and copies
shall be distributed as follows:

Copy 1 to 3 - COA
Copy 4 & 5 - DAS-CIAD/Finance Section
Copy 6 - Travelling Employee

4. Schedule of Activities (Exhibit 3)

4.1 The Schedule of Activities shall be accomplished for travels in


connection with the performance of the departments/offices
function.
4.2 This shall outline the activities to be undertaken for the
duration of the travel. The output expected to be generated from
these activities in relation with the purpose of the travel shall also
be reflected in this form.
4.3 The Schedule of Activities prepared by the travelling
personnel (team leader for group undertakings) shall be certified
by the head of office/department.

4.4 This shall be attached to the TA and shall follow its copy distribution.

5. Undertaking for the Liquidation of Travel Cash Advances (Exhibit 4)


5.1 This shall ensure prompt liquidation of travel cash advances.
This form is prepared by the travelling official/employee to serve
as an authorization for the automatic deduction of outstanding
travel cash advances from any money claims of the travelling
employee against the NFA in the event that the employee fails to
liquidate the travel cash advance on or before a specified date of
thirty (30) days upon completion of travel based on the date
reflected in the TA processed by DAS-CIAD/Finance Section.
5.2 The Disbursement Voucher No. and amount of travel cash
advance portions of the undertaking shall be filled-up by the
voucher processor after processing the claims for travel cash
advances.

6. Certificate of Travel Completed - Exhibit B (Exhibit 5)


6.1 Within thirty (30) days from completion of travel, the travelling
employee shall liquidate his/her travel cash advance. This shall be
effected thru the preparation of CTC.

6.2 The travel form shall reflect the actual itinerary of travel of the
employee, expenses incurred including the taxi fares, travel cash
advances received from the official station/destination office,
amount to be reimbursed or refunded and official receipt
number/date/amount for refunds made.

6.3 CTC shall be prepared in three (3) copies by the travelling


employee/official, copy distribution as follows:

Copy 1 - COA
2 - DAS-CIAD/Finance Section 3 - Travelling Official/Employee

7. Travel Accomplishment Report ( Exhibit 6)

7.1 The Travel Accomplishment Report portion of the form shall be filled-up by
the travelling rank and file employee. The activities undertaken and output of
the activities shall be reflected in this report.

7.2 The travel document shall be accomplished in four (4) copies and shall be
distributed as follows:

Copy 1 - COA
2 - DAS-CIAD/Finance Section
3 - Head of Destination Office
4 - Travelling Employee

8. Certificate of Appearance (Exhibit 7)

The Certificate of Appearance shall be secured by the travelling rank and file
employees from the offices or places visited. The head of the destination
department/field office shall certify that the employee has reported to the
department/field office for a specified period.

NFA executives shall be exempted from the submission of certificate of


appearance and preparation of travel accomplishment report requirement for
travel liquidation in case there are other documents to evidence the travel. In
the absence of such, the executives shall comply with this travel liquidation
requirement.
9. Trip Permit (Exhibit 8)

9.1 The form shall be used to document absence from the official station for
less than one full day. This shall reflect the trip authorization, the certificate of
appearance and actual itinerary including expenses incurred.
9.2 This shall be prepared by the travelling employee in three (3)
copies and shall be distributed as follows:
Copy 1 - COA
2 - DAS-CIAD/Finance Section
3 - Travelling Employee

9.3 The head of the department/office shall approve the trip permit.

H. Travel Cash Advance


1. This shall refer to the amount of travelling expenses given to the
employee prior to actual travel and subject to liquidation.
2. Local travels shall be treated and accounted for as cash advances
and no longer as direct charges to appropriations of allotments (EO
248).
3. No employee shall be granted a new travel cash advance unless
previous travel cash advances have already been liquidated.
4. To be able to avail of air fare discounts ranging from 35% to 45% of
regular fares, the following offices with regular activities involving travels
shall be encouraged to make advance bookings and purchase of
tickets:
DMO - National Planning, Quarterly Assessments

IAS - Audit engagements

MSD - Computer Training, Networking/Software Installations

DAS - Accountants' Conference and Conventions

HRMD- Manpower Trainings

Extension- Farmers' Trainings/Technical Assistance Program


Trainings, etc.

TRDD - Field Researches/Classifiers Pool Training

TSD - Field Inspections, etc.


BRD - Stakeholder's Conference/Seminars/Affairs

Other offices/departments shall also be encouraged to program


their travels in advance so advance bookings and purchase of
tickets could be made.
5. Processing of claims for travel cash advances shall therefore be
made earlier than usual to enable the travelling employee to buy their
tickets in advance. A prior purchase of fare tickets using travelling
employees personal fund and/or credit cards shall be allowed.

The TEV processor however, shall process the cash advance of


the travelling employee based on the regular fare and not the
discount price. This is for the protection of the travelling employee
in case he/she needs to rebook his/her tickets in which case the
fare is reverted to the regular price.

The following documents shall be attached to the DV:


a. Travel Authority
b. Schedule of Activities
c. Undertaking for the Liquidation of Travel Cash Advances

Above documents need not support those involving confidential


missions.
The undertaking document for the liquidation of travel cash
advances shall be required in the processing of travel cash
advances for confidential missions. The travellling employee need
not indicate the place of travel in the undertaking document.

However, the following shall be reflected in the DV:

a. Mission Order No. and Date


b. Date of Departure/Return From/To Official Station (for
monitoring of liquidation and as basis for number of days entitled
to travel cash advance).
6. All processed travel cash advances shall be recorded in the Travelling
Expense Index maintained by DAS-CIAD/Finance Section for each employee.
This shall be used to monitor liquidation of travel cash advances.
Additional travel cash advances authorized thru wire extension
authority (copy of which is furnished DAS-CIAD/Finance Section)
shall be noted in the index card. Subsequent entries shall be
made based on information re: cash advances granted by
destination office reflected in the certificate of appearance.

In case of executives who are exempted from the requirements on


certificate of appearance, the destination office shall send a wire
informing DAS-CIAD/Finance Section of additional travel cash
advances granted to the executive indicating the wire authority
number and date.

I. Liquidation of Travel Cash Advance


1. To ensure compliance to the policy on prompt liquidation of travel
cash advance, the following shall be observed:
1.1 Regardless of the thirty (30) day prescribed period for
liquidation of travel cash advance, an employee who needs
to travel again immediately upon return shall not be granted
a new travel cash advance unless he/she has liquidated
his/her previous cash advance.
1.2 Since the due dates are based on the processed TA (Exhibit
1) (information in the DV for mission orders), travels which were
cancelled, terminated, extended or deferred shall be formally
communicated in writing by the travelling employee to DAS-
CIAD/Finance Section immediately. The written notice shall be
noted by the head of office of the travelling employee.
1.3 All travel liquidation documents received shall be recorded in
the Travelling Expense Voucher (TEV) Liquidation Logbook. Prior
to acceptance of the document, the receiving clerk shall see to it
that complete supporting documents are attached to the
liquidation voucher. This shall serve as basis for counter-checking
in case of reimbursement.

These documents shall include:


i. Certificate of Travel Completed

ii. Copy of Audited Travel Authority Travel Cash Advance Voucher

iii. Accomplishment Report/Certificate of Appearance (Executives are


exempted from this requirement in case there are other documents to
evidence the travel)
iv. Mission Order (for travel involving confidential
mission)
v. Wire Authority for Travel Extension (in case
no copy of wire was furnished to DAS - CIAD
(C.O.) / Finance Section (F.O.).
vi. Reimbursement Expense Receipt (RER)
vii. Travel Tickets (bus, ferrying, plane)

The Disbursement Voucher shall be used for both cash advance and
liquidation thereof whether refund or reimbursement so that propriety of
the claim shall be passed upon through the regular disbursement
system.
In case no travel cash advance was claimed prior to travel,
the TA and Schedule of Activities shall be attached together
with other travel expense documents.
1.4 Submission of incomplete documents shall tantamount to no
liquidation made and shall, therefore, subject the employee to the
policies covering automatic settlement of unliquidated travel cash
advance.
1.5 Processed liquidation papers shall also be reflected in the
travelling expense index.
1.6 In case the travel is cut short for three (3) days or more or if
there is an excess (i.e. actual expense is less than the cash
advance) same shall be deducted in full from the salary of the
travelling employee on the following month after the submission of
liquidation papers.
In case the net take home pay is not sufficient to cover the
full deduction of the excess TEV, the amount to be
deducted shall be up to his/her take home pay.
The Notice of Excess Travel Cash Advance shall be
prepared in two (2) copies (Copy 1 : Travelling Employee
and Copy 2: DAS-CIAD/Finance Section ) and shall be
signed by the following :
Department Manager, DAS : C.O. Executives
Chief, DAS/CIAD : C.O. Rank and File Employees
Regional Manager : R.O. Personnel
Provincial Manager : P.O. Personnel
1.7 In case no payroll deduction can be effected, DAS-CIAD/Finance
Section shall immediately send a demand memorandum for excess
travel cash advances to the employee requiring him/her to pay the
excess travel cash advance to the collecting officer on or before a
specified date. Settlement of the account after said date shall subject
the employee to interest charges of 1.5% per month.
The demand letter shall be signed by the Chief of CIAD for
rank and file employees and by the Department Manager of
DAS for those involving executives.
1.8 For field offices, the Regional Manager/Provincial Manager shall
sign the memorandum prepared by the Finance Section.
1.9 In case of cancellation of travel, the travel cash advance for
previously approved TEVs shall be refunded in full to the collecting
officer. The employee shall inform in writing DAS-CIAD/Finance Section
of the travel cancellation within two (2) days from the date of
cancellation and of any refund made. The written notice shall be noted
by the head of office of the travelling employee. If no refund was made
by the employee to settle the account, automatic deduction of the
outstanding travel cash advance shall be made from his/her salaries
and allowances in the next payroll period (as specified in item I.1.6) .
The head of department/office shall ensure compliance to
this policy by the employees concerned.

2.0 Credit Memo


A Credit Memo is being issued to the travelling
official/employee after he/she has liquidated his travel cash
advance by submitting all the necessary documents for
travel completed, and by paying the excess amount of cash
advance through salary deduction. The corresponding
payroll number and the amount shall be indicated in the
Credit Memo.

The Credit Memo serves as evidence that the travel cash


advance has been liquidated. The amount of Credit Memo
shall be composed of travel expenses incurred and amount
paid through salary deductions.

J. Other Control Measures


1. Travels whose purpose is to perform functions that have been
delegated or decentralized to the field level shall not be authorized
unless the services of the personnel are requested by the field official to
augment field office personnel force

2 . Central Office departments/offices having field office counterparts


shall refrain from sending their employees on travel and instead, shall
coordinate/generate reports from the field counterparts, unless there is
a need for a highly technical job wherein the field office concerned does
not have the necessary expertise.

3. No two employees shall travel to the same place and time for the
same purpose unless absolutely necessary (e.g. travels involving team
assignments).

4. Travelling expenses of employee whose attendance is required in


connection with an investigation or administrative case where he himself
is a party respondent shall be personally borne by the employee.

5. Travel deviations shall be accompanied by written justifications to be


approved/ recommended for approval (depending on level of authority)
by the head of department/office.

6. No employee maybe allowed to go on leave while on travel except for


emergency cases and subject to the approval of the head of
department/office concerned. No travelling allowance shall be allowed
for the duration of the authorized leave.

7. Any official/employee who goes on leave for more than seven (7)
calendar days shall shoulder the transportation expenses from
destination to residence.

8. To avoid leaving behind uncompleted projects by the employee, the


head of the destination office shall recommend extension of travel.
Likewise, the head of the destination office may cut the travel short
(terminate the travel in advance) should the purpose of travel be
accomplished ahead of schedule. The head of department/office of the
travelling employee shall be informed accordingly.
9. To avoid several employees trooping to a PAL Office to buy tickets,
each department/office shall assign an employee (preferably the
messenger) to buy the tickets of all travelling employees in that
department/office.

10. In case of lost plane tickets, an affidavit of loss shall not be considered as
an appropriate replacement. Instead, the travelling official/employee shall
secure a Certification of Travel from the Airline Company (i.e. PAL - Legal
Department).

K. Accounting Policies
1. No cash advance shall be granted to any official or employee unless
a proper accounting of the previous cash advance for travel given to him
is first made or the same is first liquidated and/or settled.
a. Proper accounting shall mean the receipt by DAS-
CIAD/Finance Section of complete prescribed liquidation
documents although not yet recorded in the books of accounts
audited by the auditor.
b. Liquidation shall mean the recording of the liquidation
documents in the books of accounts by the accountant as a credit
to the cash advance account after verifying the same although not
yet audited by the auditor.

c. Settlement shall mean the issuance of the Credit Notice by the


Auditor after the audit of the liquidation documents.

2. Cash advances granted for purposes of official travel, both local and
foreign, shall not require bonding of the travelling official or employee.
3. Chart of Accounts :
Accounting entries for travel cash advance/liquidation of expenses
are as follows :
a. Grants of Cash Advance
DR : Cash with Other Officers 5,000 (Memo Entry at VRJ)
CR: Cash in Bank- Combo or 5,000 (For recording at
CCRJ)
Current Account

b. Liquidation

b.1 Reimbursement

DR : Expense TEV 5,500


DR/CR : Vouchers Payable 5,000 5,000
CR : Vouchers Payable 500
CR : Cash with Other Officer 5,000

(For recording at VRJ)


Legend : includes reimbursement amount of P 500.
DR : Vouchers Payable 500
CR : Cash in Bank - Combo or
Current Account 500

For recording at CCRJ the additional amount of TEV reimbursement.

b.2 Refund

DR : Appropriate Activity - Travelling


Expenses xxx
DR/CR : Vouchers Payable xxx xxx
CR : Cash with Other Officials and
Employees xxx
b.3 Payroll Deduction re : Excess TEV
DR : Salaries/Allowances xxx
CR : Statutory Deduction xxx
CR : Other Deduction xxx
CR : Cash - Other Officials and Employees xxx
CR : Vouchers Payable xxx

DR : Vouchers Payable xxx


CR : Cash - Other Banks - Current xxx

b.4 Direct Payment to the Cashier

DR : Cash with Collecting Officer xxx


CR : Cash - Other Officials and Employees xxx
4. The interest charge of 1.5% per month imposed on
unliquidated/unsettled travelling expenses account shall be taken up as
Miscellaneous Income under Operating and Service Income. For
reference, a breakdown of payment (excess or unused travel cash
advance and interest) shall be indicated in the official receipt by the
cashier as computed by the accounting unit.
5. Index cards for domestic and foreign travels shall be maintained.
6. Travelling expenses shall be charged against the department/office to
which project/activity originates. In this case, the requesting office shall
be charged for the employees travelling expenses. A copy of the
request shall be attached to the Travel Authority.
In case of detailed employees (with Special Orders), the travel
shall be authorized by the head of department/office where the
employee is detailed and the travelling expenses correspondingly
shall be charged to that office.
III. RESPONSIBILITIES

1. Approving Official (Administrator, Deputy Administrator, Asst.


Administrator Special Assistant, Regional Manager, Asst. Regional
Manager, Provincial Manager or OIC)

Approves/disapproves travel requests taking into account the necessity of the


travel and the travel control measures herein provided.
2. Recommending Official (Deputy Administrator, Assistant
Administrator,
Department Manager, Head of Staff, Regional Manager, Asst.
Regional Manager, Provincial Manager or OIC, Asst.
Provincial Manager)

2.1 Recommends travel requests which are necessary to the service taking
into account the travel control measures provided herein.
2.2 Ascertains that the period covered in the travel request is
reasonable and the travelling expenses claimed are proper.

3. Head of Department/Office

Ensures compliance to policies particularly on the prompt


liquidation/settlement of travel cash advances.

4. Chief, DAS -CIAD

4.1 Ensures compliance to accounting and auditing rules/policies particularly


those related to the granting and prompt liquidation of travel cash advances.
4.2 Affixes his/her initials on Notice of Excess Travel Cash
Advances and Demand Memorandum to be issued to C.O.
executives and forwards same to the Department Manager for
Accounting Services for signature.

4.3 Signs Notice of Excess Travel Cash Advance and Demand


Memorandum for excess travel cash advance to be issued to rank
and file employees.

4.4 Effects deduction of overdue accounts from any money claim of the
employee against the NFA.
4.5 Records transactions in the Books of Accounts in accordance
with the accounting policies provided in this SOP.

5. Chief, Cash Division

Ensures compliance to check payment policies.

6. Regional/Provincial Accountant
6.1 Ensures compliance to policies particularly those related to
the granting and prompt liquidation of travel cash advances.
6.2 Prepares Notice of Excess Travel Cash Advances and Demand
Memorandum to be issued to the concerned Regional/Provincial Office
personnel which shall be signed by the Regional Manager/Provincial
Manager/OIC.
6.3 Effects deduction of overdue accounts from any money claim
of the employee against the NFA.
6.4 Records transactions in the books of accounts in accordance
with the accounting policies provided in this SOP.

7. Cashier (F.O.)

Ensures compliance to check payment policies.

8. Travelling Employee

8.1 Accomplishes the required travel forms for approval by the concerned
official.
8.2 Presents travel authorization/schedule of activities to the head of
destination office.

8.3 Liquidates travel cash advances within thirty (30) days from travel
completion by submitting required documents and payment of excess travel
cash advance.
8.4 Informs in writing DAS -CIAD / Finance Section in case travel is
cancelled, postponed, cut-short or extended.
8.5 Refunds to the collecting officer unused travel cash advances.

9. Head of Destination Office

9.1 Reviews the travel authorization and schedule of activities of the travelling
employee.

9.2 Recommends extension or pre-termination of travel to the concerned


official, if necessary.
9.3 Grants additional cash advance as authorized and informs the
official station of the employee of the additional cash advance granted.

IV. Please see Data Flow Chart


A. Travel Cash Advance
B. Liquidation of Travel Cash Advance
IV. FLOW CHART
Top Page
EXHIBITS
Travel Authority
Exhibit 1 - Soil Titling
Schedule of Activities
Undertaking for the Liquidation of Travel Cash Advances
Travel Accomplishment Report
Certificate of Appearance
Notice of Excess Travel Cash Advance
Travelling Expense Index
Trip Permit
Flowchart-Domestic Travel

SOP Library
SOP NO: HR-PA08.J (List of Exhibits/Attachments)

Mission: Finance and Administration

Area: Human Resource (HR)

Activity: Personnel Administration (HR-PA)

Title: Amendment to the SOP on Domestic Travel

Date Approved/Issued: 05/25/2006

Date Effective: 05/25/2006

Digest:

I. TERMS OF REFERENCE
A. Rationale
B. Objective
C. Scope
D. Basis

II. IMPLEMENTING GUIDELINES

III. BASES
13. Collectivr Negotiation Agreement (CNA) between NFA and NFAEA
approved January 27, 2006.

IV. IMPLEMENTING GUIDELINES


xxx

F. Day-off
Pursuant to Article VI, Section 13 of the NFA
Collective Negotiation Agreement (CNA), NFA
emplloyees are entitled to one (1) day-off for travel
wth duration of four (4) days up ten (10) days
(regardless of wether the travel falls on weekdays,
weekends or holidays). two (2) days-off for travels
with duration of eleven (11) to nineteen (19) days and
three (3) days off for travels with duration of twenty
(20) to twenty nine (29) days. Reckonong of number
of days of travel shall include travel time to and from
destination. xxx

xxx
xxx
This amendment to the SOP shall take effect this 25th day of May
, 2006. All rullings and/or issuances inconsistent herewith are
hereby superseded.

GREGORIO Y. TAN, JR. (ASD)


NFA Administrator

Date Approved: May 25, 2006

III. RESPONSIBILITIES

IV. FLOW CHART


Top Page
EXHIBITS
No Exhibit/s Available for this SOP
SOP Library
SOP NO: HR-PA08.K (List of Exhibits/Attachments)
Mission: Finance and Administration

Area: Human Resource (HR)

Activity: Personnel Administration (HR-PA)

Title: Amendment to the Revised SOP on Domestic Travel (TEV Forms)

Date Approved/Issued: 03/13/2017

Date Effective: 03/13/2017

Digest:

I. TERMS OF REFERENCE
A. Rationale
B. Objective
C. Scope
D. Basis

II. IMPLEMENTING GUIDELINES

For the information, guidance and compliance of all concerned, published hereunder
is the amendment to the Revised SOP on Domestic Travel specifically the revised
forms on the documentation of the liquidation of travel cash advance provided in SOP
No. HR-PA08.H entitled Amendment/Addendum to the Revised SOP on Domestic
Travel, approved and made effective May 3, 2004.

Hence the following TEV liquidation forms are hereby amended:

1. Undertaking for the Liquidation of Cash Advance Exhibit 1


(Exhibit 2 of HR-PA0 8.H)
2. Notice of Unliquidated Cash Advance Exhibit 2
(Exhibit 4 of HR-PA08.H)
3. Notice of Excess Travel Cash Advance Exhibit 3
(Exhibit 5 of HR-PA08.H)
4. Notice of Unused Travel Cash Advance Exhibit 4
(Exhibit 6 of HR-PA08.H)

It is reiterated that Cash Advance liquidation within 30 calendar days upon arrival
from travel should be strictly implemented in compliance with the conditions set by
the Governance Commission for GOCCs provided in GCG MC No. 2013-02 dated
June 24, 2014, Subject: Performance Evaluation System (PES) for the GOCC Sector.
All provisions of the Revised SOP on Domestic Travel and its amendments
inconsistent with the provisions of this amendment are hereby superseded.

This amendment shall take effect immediately upon approval.

JASON L.Y. AQUINO


NFA Administrator

III. RESPONSIBILITIES

IV. FLOW CHART


Top Page
EXHIBITS
Exhibit 1 - Undertaking for the Liquidation of Travel Cash Advance/Payment of Excess Travel Cash
Advance/Refund of Unused Travel Cash Advance
Exhibit 2 - Notice of Unliquidated Cash Advance
Exhibit 3 - Notice of Excess Travel Cash Advance
Exhibit 4 - Notice of Unused Travel Cash Advance
SOP Library
SOP NO: HR-PA10 (List of Exhibits/Attachments)

Mission: Finance and Administration

Area: Human Resource (HR)

Activity: Personnel Administration (HR-PA)

Title: Guidelines and Procedures on the Non-Monetary Remuneration for Overtime


Services Rendered

Date Approved/Issued: 12/06/2004

Date Effective: 11/01/2004

Digest:

I. TERMS OF REFERENCE
A. Rationale
B. Objective
C. Scope
D. Basis

II. IMPLEMENTING GUIDELINES


1. In the exigency of the service, employees may be required to render
services beyond the regular 40 working hours in a week

2. The Head of Office shall determine the need for overtime


services. In this regard, he/she shall issue the authorization for
concerned employees to render overtime for a specified purpose on a
specified date and time.
3. Overtime services may be authorized only for the following activities:
3.1. completion of infrastructure and other projects with set
deadlines when due to unforeseen events the deadline cannot be
met without resorting to overtime work;

3.2 relief, assistance, and other related work or services during


calamities and disasters;

3.3. seasonal work such as budget preparation and rendition of


financial monthly and annual reports to meet scheduled
deadlines;

3.4. preparation of special/financial/accountability reports required


occasionally by central monitoring agencies like the Congress of
the Philippines, Office of the President, Commission on Audit, and
Department of Budget and Management;

3.5. implementation of special programs/projects embodied in


Presidential directives and authorizations and with specific dates
to complete, which are in addition to the regular duties of the
employees;

3.6. legal services to facilitate the dissolution of


cases/resolutions/decisions;

3.7. Services rendered by drivers and other immediate staff of


officials when required to keep the same working hours as their
superiors, and

3.8. Such other activities as maybe determined by the head of the


agency, as follows:
3.8.1. Procurement and warehousing operations during
peak seasons
3.8.2. Unloading and dispersal operations for imported
stocks as well as during calamities and disasters or
emergency cases
3.8.3. Related transport services to the operations specified
above
3.8.4. Security and communication
3.8.5. Staff house services and field office utility workers

4. Payment of overtime services in cash shall no longer be


allowed. Instead, an employee shall earn Compensatory Credit for
Overtime Services (CCOS) or the accrued number of hours resulting
from services rendered beyond regular working hours, and/or those
rendered on Saturdays, Sundays, Holidays or non-working days without
the benefit of overtime pay.

5. Computation of Compensatory Credit for Overtime Services (CCOS)


shall be as follows:
5.1. for overtime services rendered on weekdays or scheduled work days

CCOS = number of hours of overtime services x 1.0

5.2. for overtime services rendered on weekends, holidays, or scheduled days


off:

CCOS = number of hours of overtime services x 1.5

6. In the accrual and use of CCOS:


6.1. each employee may accrue not more than forty (40) hours
of CCOS in a month. In no instance, however, shall the
unexpended balance exceed one hundred twenty hours (120)
hours.

6.2. The CCOS shall be used as time-off within the year these are
earned. The unutilized CCOS should not be earned over the
ensuing year, hence, non-cumulative
6.3. The CCOS shall be considered as official time for the following purposes:
6.3.1. Compliance with compensation rules relative to
the entitlement of PERA, Additional Compensation,
year-end benefits, and other benefits received on a
regular basis, and
6.3.2. Computation of service hours for retirement to
sick and vacation leave credits, and step increment
due to length of service.

7. The use of the CCOS is limited to the following:


7.1. the CCOS cannot be used to offset undertime/s or tardiness
incurred by the employee during regular working days;
7.2. the CCOS earned cannot be converted to cash, hence, are non-
commutative;

7.3. the CCOS will not be added to the regular leave credits of the
employee. Hence, it is not part of the accumulated leave credits
that is paid out to the employee.

8. CCOS Effect on Personnel Movement:


8.1. In cases of resignation, retirement, or separation from the
service, the unutilized CCOS are deemed forfeited
8.2. In case of detail, secondment or transfer to another agency,
the CCOS earned in one agency cannot be transferred to another
agency, nor could the employee receive the monetary equivalent
thereof.

8.3. In case of promotions, except when promoted to a position


not qualified to receive overtime pay under previous issuances,
the employee will retain his or her accrued CCOS.

9. An employee who has earned CCOS shall be granted a Certificate


of CCOS Earned (Exhibit 1) prepared by the Exec. Asst./RAO/PAO and
duly approved and signed by the Head of Office. The Certificate
indicates the number of hours of earned CCOS by the employee as of a
given month. The certificate shall be issued at the end of each month.

10. Availment of Compensatory Time-Off (CTO)


10.1. The Compensatory Time-Off (CTO), or the number of
hours or days an employee is excused from reporting for work
with full pay and benefits, may be availed in blocks of four (4) or
eight (8) hours

10.2. The employee may use the CTO continuously up to a


maximum of five (5) consecutive days per single availment, or on
a staggered basis within the year.

10.3. The employee must first obtain approval from the head of
the agency/authorized official regarding the schedule of availment
of CTO. The management shall accommodate to the extent
practicable, all applications for availment of CTO at the time
requested by the employee.. In the exigency of the service
however, the schedule may be recalled and subsequently
rescheduled by the Head of the Office/authorized official within
the year

III. Duties and Responsibilities

1. Head of Office/Department/Regional/Provincial Manager


1.1. Authorizes employees to render services beyond regular working hours in
accordance with these guidelines and the rules and regulations on
overtime service.
1.2. Grants Certificate of CCOS Earned, concurrently
setting safeguard measures to prevent any form of
fraud and/or duplicity.
1.3. Approves/disapproves schedule of CTO as
requested by the employee, without compromising the
delivery of services to clientele.
1.4. Ensures proper implementation of these
guidelines. Acts accordingly should violations or
irregularities be committed.

2. Employee

2.1. Observes properly the procedures in earning of CCOS and availing of


CTO.
2.2. Requests approval from the head of Office on the schedule of CTO.
2.3. Monitors the balance of earned CCOS vis-a-vis CTOs availed of.

3. Executive Assistant/ RAO/PAO


3.1. Submits to the head of Office a monthly report on
summary of overtime services rendered and the
equivalent CCOS (Exhibit 2); reports critical incidents
or observations.
3.2. Prepares Certificate of CCOS for signature of the Head of Office.
3.3. Reflects on the time card the application for CTO filed by the employee.
3.4. Recommends measures to improve the
implementation of the guidelines to grant CCOS and
availment of CTOs.

IV. Procedural Flow Diagram (Please see attached)

For the duration of effectivity of AO 103, the rulings and policies in SOP No.
HR-PA07, Revised SOP on Overtime Services, specifically Item D, is hereby
amended. In addition, all rulings, policies, and/or issuances regarding
compensatory-day off inconsistent herewith are hereby superseded.
III. RESPONSIBILITIES

IV. FLOW CHART


Top Page
EXHIBITS
No Exhibit/s Available for this SOP
SOP Library
SOP NO: HR-PA12 (List of Exhibits/Attachments)

Mission: Finance and Administration

Area: Human Resource (HR)

Activity: Personnel Administration (HR-PA)

Title: Guidelines on the Creation of Work Groups/Committees in the NFA

Date Approved/Issued: 04/05/2016

Date Effective: 04/05/2016

Digest:

I. TERMS OF REFERENCE
A. Rationale
B. Objective
C. Scope
D. Basis

II. IMPLEMENTING GUIDELINES

Work / Task Groups and Committees are essential to the effective operation
of the organization. Effective groups can be one of the most important working
forces at the heart of an organization, while providing rewarding experience of
learning for those involved.

For the guidance and immediate compliance of all concerned, the creation of
work groups in the NFA shall conform to the following guidelines:

Work Groups shall be categorized as:

a. Permanent Committee- is a group with specific responsibilities


established for programs or any undertaking created by standing
orders, rules, or regulations of the Agency. It exists and functions
more or less on a permanent basis. Ensuring that the
programs/projects implementation is in accordance the
provisions of its covering law/order, will be its primary
responsibility. Moreover, the collegial decision of its members, if
required, is the majority vote of its members.
b. Project Steering Committee - created with a main purpose of
making strategic decisions concerning future realization of a
specific project / plan, e.g. NFAs SPMS, E-IFOMIS, investment
projects. It is responsible for the management and monitoring of a
long-term plan for the program, which means that it controls the
realization of the objectives at the strategic level, verifies the
programs coherence with established aims, and keeps
established frames such as range of responsibilities/
accountabilities, costs and deadlines.
c. Technical Working Group is a selected and special group of
individuals appointed for a a short-term and particular, which may
be cutting across departmental functions. It has specific
responsibilities and deliverables which span across functions of
two or more departments. It is usually under and reporting to a
Permanent or Project Steering Committee. Its composition will be
determined by the overseeing or oversight Committee which
ensures that concerned offices are competently represented in
the working group. It will cease operations once the
program/project is in its full implementation by the
lead/responsible department, or as determined by the oversight
committee.

The creation of work groups cited in items a, b and c will be in


accordance with the following provisions:

The creation of Committees and


corresponding TWGs will be
undertaken sparingly, or only where
responsibilities and activities
necessary to attain the objectives
are widely spread across the
organization. Recommendation to
create Committees will pass
through the EXCOM, and final
issuance of a Special Order
creating one will be approved and
signed by the Administrator. The
CPMSD shall act as Clearinghouse
of recommendations.
Membership in a Committee or a
Technical Work Group, as much as
possible, will be identified/designated with
position titles of members, instead of
specific given names. However,
membership may be designated with
specific names for short term, ad hoc, or
special work groups, where the
individuals expertise is most appropriate,
as needed.
Special Orders creating Committees or
Technical Work Groups will indicate
objectives, policies, strategies,
procedures, time lines and departmental
responsibilities. Once these factors are
defined, the concerned departments will
be on their own, undertaking their defined
responsibilities, coordinating with other
departments or units concerned, and
regularly consulting with each other and
the chairperson of the committee. They
will report to the Chair of the Committee,
who may, at his/her discretion, call for a
Committee meeting for integration.

d. AD HOC / Task Force/Project Team Interchangeably, this


type of work group is created to undertake a specific task within a
specific period that may be inter-departmental or just intra-
departmental. As in most projects and undertakings, coordination
with other departments/offices is a major component of the task,
but the realization of its objectives primarily rests on a specific
department which becomes the lead department. Hence, creation
may be just through an interdepartment memo that may be signed
by the lead department and may be noted by the concerned
Assistant or Deputy Administrator.

Where programs/projects fall within one or a few


departments/offices functions only, there is no need to
create Committees. Instead, it will be up to the most
concerned department to undertake all coordinative
activities, and have the responsibility to ensure that the
objectives of the undertaking are met. Usually, these are
functions which are SOP-defined, forming part of the
departments functions, even though these activities are
cross-organizational concerns, e.g. Inventory Taking.

2. Reasonable operating / meeting expenses will be provided /


budgeted for each major undertaking, following established policies,
rules on budgeting, accounting and auditing standards.

3. The Corporate Planning and Management Department (CPMSD) will


be the clearinghouse/office tasked to evaluate and recommend creation
of committees to prevent duplication, inconsistency and over burden of
officials and employees. It will periodically review existing committees in
the Agency, and recommend each committees continuance,
termination or conversion, in accordance with these policies and
provisions/guidelines. It shall maintain an updated compilation of
committees, appropriately categorized, which will serve as common and
official reference by all concerned.

4. Approval for the creation of a Committee by the Administrator will be


through the EXCOM.

All existing work groups not conforming with any characteristics/ properties as
defined in these Guidelines will be the responsibility of the lead department.
The lead department should see to it that all other related existing work
groups conform with the guidelines.

These guidelines on the creation of Work Groups/Committees will take effect


this 5th day of April, 2016.
III. RESPONSIBILITIES

IV. FLOW CHART


Top Page
EXHIBITS
No Exhibit/s Available for this SOP
SOP Library
SOP NO: HR-PA13 (List of Exhibits/Attachments)

Mission: Finance and Administration

Area: Human Resource (HR)

Activity: Personnel Administration (HR-PA)

Title: Revised Guidelines on Economy Measures

Date Approved/Issued: 07/10/2017

Date Effective: 07/10/2017

Digest:

I. TERMS OF REFERENCE
A. Rationale
B. Objective
C. Scope
D. Basis

II. IMPLEMENTING GUIDELINES

For the information, guidance and compliance of all concerned, published


hereunder is the Revised Guidelines on Economy Measures. These
guidelines supersede the previous Guidelines on Economy Measures
(Memorandum No. AO-2K8-04-018 dated April 03, 2008) signed by then
Administrator Jessup P. Navarro.
E. Definition of Terms :

1. Austerity measure refers to the official actions being


undertaken to minimize expenses while ensuring continuous work
efficiency.
2. Overtime Services - refers to services rendered by an
employee beyond the 8-hour work schedule on regular work day
(Mondays to Fridays) and on Saturdays, Sundays and holidays or
non-working days or for security guards, those rendered outside
the 8-hour schedule of their regular five working days and those
rendered on the remaining 2 days including holidays.
3. Compensatory Time-Off (CTO) - refers to the number of
hours or days an employee is excused from reporting for work
with full pay and benefits. It is a non-monetary benefit provided to
an employee for overtime services in lieu of overtime pay.
4. Overtime Pay is the cash payment for work performed by an
employee beyond the regular working hours in a day, and those
performed on rest days, holidays and non-working days.
5. Job Order - refers to the hiring of a worker for a piece of work
or intermittent job of short duration not exceeding six (6) months
and pay is on a daily basis.
6. Conferences, Conventions, Seminars and the like refers
to those conducted basically for purposes of sharing, discussing
or disseminating ideas or information on the developments in a
particular field or fields of interest and/or for common appreciation
and resolution of certain issues. It includes, but is not limited to,
those conducted by professional organizations or groups of
common interest where government employees are members. It
excludes those conducted for training purposes where
participants are expected to gain or strengthen skills and technical
or management expertise in their areas of endeavor.
7. Resource person any person who, by virtue of his/her
expertise in a specific subject area, serves as speaker in
seminars, conferences, symposia, training programs and similar
activities.
II. IMPLEMENTING GUIDELINES
When austerity/economy measures are required within NFA or as
a national move, the following policies shall be applied.
All NFA officials and employees are hereby required to implement these
economy measures. All RAMs/PAOs/RAOs and Heads of Offices shall
be responsible for its strict implementation.
A. GENERAL PROVISIONS

1. Evaluate all future expenditures (revenue or capital) including


capital outlay and MOOE-RMT Projects in your approved budget
ceiling and determine which may be considered as least priority
which may be deferred or suspended for later implementation, to
ease NFA cash flow.

All expenditures or projects to be undertaken shall be


coursed thru BTFMD for funding purposes prior to its
implementation. The Regional/Provincial Offices should
ensure that there is already an Advice of Sub-allotment
before project implementation.
2. Remittances of funds should be requested only by the Regional
Offices when actual disbursement of payments are due, to avoid
idle funds.

3. Remit back to central office idle CPF and retain only the
needed amount to defray one (1) week palay procurement
requirement.

4. Fastrack divestment of non-performing assets.


5. Generate additional sources of income/cash receipts through :

Aggressive collection of registration and


licensing fees from grains businessmen;
Intensive collection of trade, non-trade and dormant
receivables; and
Fastrack disposition of waste materials, unserviceable
empty sacks and junked/non-performing
assets/properties

All funds generated from various sources (check and cash


collections), shall be deposited on or before 3:00pm on the
day the collection has been made as specified in item
IV.B.1 of the Amendment/Addendum to the SOP on Cash
Collection and Deposits approved December 29, 2006.
B. SPECIFIC PROVISIONS
1. OVERTIME SERVICES
The rendition of overtime services shall be authorized only when
very urgent and necessary, and in accordance with the Revised
SOP on Overtime Services (SOP No. HR-PA07) approved March
26, 1999 and the Guidelines and Procedures on the Non-
Monetary Remuneration for Overtime Services Rendered (HR-
PA10) approved December 06, 2004 respectively.
The immediate supervisor shall be directly responsible in
monitoring the strict implementation of this policy.
2. OPERATIONS-RELATED EXPENSES

a. Maximize use of warehousing and other NFA Post-


Harvest Facilities (PHFs). As much as possible, minimize
the use of Leased Warehouses. Rent of warehouses should
be vis--vis the provinces level of inventory.

b. Rationalize trucking, handling and other related


expenses.

c. Pursue aggressive collection from the Stock Accountable


Officers (SAOs) with final TOLA computation targeted at not
less than ten percent (10%) of the total shortage by the end
of the year, and every year thereafter.

d. Maximize utilization of personnel in the field offices during


peak operational activities.

e. Adopt Just-in-Time principle in the movement of stocks.


No movement of stocks shall be held at the provincial office
unless extremely necessary. The Provincial Manager shall
be responsible for the proper planning in the area under
his/her jurisdiction.

f. Strictly implement the policies embodied in the SOP on


Warehousing Policies and Procedures (SOP No. GM-
WH07) to protect stocks and avoid damage.

3. HIRING OF JOB ORDER PERSONNEL


a. As an interim measure, there shall be a moratorium on
hiring of JO personnel to perform clerical and utility worker
functions as well as to perform functions of a vacant
position. Existing JO contracts of these types shall be
allowed to continue up to the end of their contracts only
except when exigency of service warrants.
b. Henceforth, hiring of JOs as warehouse staff should be
vis--vis a warehouse level of inventory and operations and
volume of transactions.
c. Maximize utilization of personnel in the field offices before
hiring job order personnel.
d. Other provisions in the existing guidelines on hiring of job
order personnel (Memorandum No. AO-2KJ-06-013 entitled
Policy-Guidelines on Hiring of Workers on Contract of
Services / Job Order
Basis approved by then Administrator Anthony A.
Abad dated May 10, 2001) that are not inconsistent
with items 3.a to 3.c shall still apply.
4. LOCAL TRAVEL

a. Domestic travels shall be strictly controlled to those


absolutely necessary.

b. Travels of central office officials/employees to functions


that have been delegated or decentralized to the field
offices are not allowed and that central office departments /
offices should only coordinate with their field office
counterparts, unless there is a need for a highly technical
job wherein the field office concerned does not have the
necessary expertise, as provided in the Revised SOP on
Domestic Travel (SOP No. HR-PA08), approved May 10,
1999.
c. No two (2) employees shall travel to the same place and
time for the same purpose unless absolutely necessary,
except for travels involving team assignments (e.g. IASD).

d. Travel expenses of employee whose attendance is


required in connection with an investigation or
administrative case where the employee is a party-
respondent shall be personally borne by the employee.

e. The mode of and class of transportation to be taken shall


be the most advantageous to the agency from the
standpoint of economy and efficiency. Only ordinary public
conveyance or customary modes of transportation shall be
used. Exceptions may be made in meritorious cases and
justified by prevailing circumstances.

e.1 Travelling employees shall always take public


transport facilities. Only when it is proven more
economical should NFA service vehicles be used.

e.2 No employee shall be allowed to use air


transportation when the point of destination can be
reached by land transportation, except in emergency
situations and when it is more advantageous to the
agency in terms of economy and efficiency.

e.3 In cases where service vehicles are used in the


travel, the officials and employees concerned shall
not be entitled to the equivalent transportation fares.

f. Attendance of NFA Employees Associations


officials/members to union general assemblies and
meetings, activities and conferences shall be treated as
time-off or day-off only and therefore not entitled to per diem
and travel expenses as indicated in a letter of CSC dated
September 21, 2015, addressed to the NFAEA National
President, item No. 3 [Article III (Union Recognition and
Security)]. The said letter enumerated the comments of
CSC to the provisions for NFA and NFAEAs 4th NFA
Collective Negotiation Agreement dated September 21,
2015, which are non-negotiable hence, unenforceable
despite the registration of the agreement. 1st, 3rd and 4th
paragraph, of item III of the said letter states:

Conduct of union activities such as regular or


emergency meetings should be done with prior
notice to the Management to avoid controversy.
It should be done in such a way that it shall not
prejudice public service. Attendance thereto
shall be on official time only.
Attendance to general assemblies and
meetings, activities and conferences called by
any government agency or other
organizations/institutions, will be treated as
employees association time-off and may be
granted to the employees association Board of
Directors, other executive officers and members
in recognition of their participation rights for the
purpose of advancing the interest of the
employees association.
We must stress that attendance to the
abovementioned activities shall be on official
time which should be construed as a variation
of day-off as contradistinguished from official
business or leave. Hence, its availment cannot
be deferred to another day and cannot be
accumulated much less converted into cash.
Simply put, if an employee failed to avail it on
the appointed time, then the same is considered
waived.

5. ATTENDANCE TO TRAININGS, SEMINARS,


CONVENTIONS, CONFERENCE, SYMPOSIA, FORA
a. Only NFA facilities shall be used for internal
training programs / conferences / seminars.

b. For central office officials and employees,


participation to external (local and foreign) training
programs shall be limited to three (3) participants per
department/office per training program unless the
program and/or sponsoring entity allows more, at no
extra cost to NFA and no travelling expense and per
diem shall be collected from NFA.

c. For field office officials and employees, only two (2)


participants shall be allowed per province per training
program. unless the program and/or sponsoring entity
allows more, at no extra cost to NFA and no travelling
expense and per diem shall be collected from NFA.
d. As much as possible, field offices should choose
external trainings for their employees within the region
to minimize travel expenses.

e. Strictly control grant of per diem to participants of


internal and external training programs, especially
those where food and accommodation expenses are
charged to Manpower Development Fund (refer to
SOP on Manpower Training and Development).
f. In conducting internal trainings, NFA personnel with
accreditations as training facilitators shall be
prioritized as resource speakers. If outsiders should
be hired as resource speakers, hire one who comes
from the same province/region as the venue of the
internal training, to reduce travel expenses, unless
ones expertise is unique.
g. Honoraria to the resource speaker is indicated in
the Budget Circular No. 2007-1 entitled Guidelines
on the Grant of Honoraria to Lecturers, Resource
Persons, Coordinators and Facilitators dated April
23, 2007.

h. If an employee who had been issued a Training


Directive to attend an internal training program failed
to attend without prior notice due to personal reasons,
said employee shall be required to submit a written
explanation to the Human Resource Management
Department (HRMD), noted by the Head of
Office/Department within forty eight (48) hours from
the start of the said training.

If due to official reasons, the Head of


Office/Department shall inform HRMD in writing
of the reason which prevented the employee
from attending the program.
i. As far as practicable, officials/employees should
avail of early registration rates to avail of reduced
costs of participation if conventions, seminars,
conferences and the like are conducted by private
institutions or NGOs per National Budget Circular no.
563 dated 4/22/2016.

j. Attendance to
conventions/conferences/symposia/fora conducted by
private institutions or NGOs shall only be allowed
once every two (2) years per employee to give equal
opportunities to all NFA employees per SOP on
Manpower Training and Development.

6. HOLDING OF PLANNING CONFERENCE


a. An integrated annual planning conference shall be
conducted instead of separate national planning
conferences per activity (marketing, infrastructure,
DBCC, corporate, etc.).

b. Prior to the national planning conference, a division


/ department/ provincial/regional planning conference
shall be conducted to finalize plans and prepare
inputs to the national planning, in conformity with
the Bottom-up Planning/Budgeting set by the
National Government (NG).

c. Funds for the


division/department/provincial/regional planning
conference shall be sourced from the
Discretionary/Extraordinary Funds of the
Department/Office.
d. Only NFA facilities shall be used for planning
conferences (NFA offices with conference hall and
staffhouse for lodging), except when/where it is not
possible and more economical.
e. The Secretariat/Lead Department/Offices should
prepare the program and all materials needed for the
planning conference.
f. Only the Regional Director/Department Manager
shall be authorized to attend the National Planning
Conference and the staff involved/knowledgeable on
the subject matter.
g. National Planning Conference shall be limited to
two (2) days only, excluding travel time.

6. CONDUCT OF TEAM BUILDING ACTIVITIES


Fuel/Gas/Oil, toll fee and TEV of drivers for team building activities of
offices/departments shall be shouldered by officials and employees.
This policy shall apply to request after the effectivity of
this guidelines.
7. SUPPLIES AND MATERIALS AND UTILITIES

Reduce by at least ten percent (10%) the


consumption of supplies and materials, use of
landlines and cellular phones, electricity, water and
gas and oil for service vehicle based on 2016 level.

a. SUPPLIES AND MATERIALS

a.1 The GSD-PSMD (in case of central office)


and the Supply Officer (in case of field offices)
shall monitor and control the purchases,
issuances and consumption of expendable and
semi-expendable supplies and materials.

a.2 Request for supplies and materials per


RIS/PR shall be managed and controlled by the
Division Chiefs/RAO/PAO.

Request for supplies and materials should be


planned properly to avoid unnecessary
purchases. Only the necessary supplies and
materials should be indicated in the list.

a.3 The Representative for Administrative


Matters (RAMs) in the central office and Supply
Officer in the field offices, shall control the
issuance of supplies and materials to
employees.

a.4 There should be strict implementation on


the submission of the RIS 1st 3 working days of each
month in order to purchase the supplies and
materials in bulk, to avail of discounted price
and/or for competitive bidding.

a.5 If all supplies listed in the Purchase Order


are not available in the DBM-PS, Special
Disbursing Officers should only pay what is
available in the DBM-PS to avoid advance
payment. Then secure a Certificate from DBM-
PS that the other supplies are not available so
NFA can buy from other sources.

a.6 The deployment of color printers should be


limited to one (1) only per office, except for
HRMD. If other existing color printers become
non-operational, it shall not be replaced with
color printers.

a.7 Recycle bond papers, folders, fasteners,


paper clips, and other recyclable supplies.
a.8 Photocopying of documents (e.g. books, Deed of
Sale, etc.) for personal use shall not be allowed.
b. LANDLINES AND CELLULAR PHONES

b.1 The use of NFA landlines for long


distance/overseas calls shall be limited to
official calls only.

b.2 Personal long distance/overseas calls shall


be authorized but shall be paid for by the caller.
All long distance/overseas calls should be
covered by an approved request and immediate
payment for the same should be required from
the caller.

b.3 Locking of DDD and IDD Domestic Direct


Dialing; International Direct Dialing telephone
features after office hours and weekends shall
be strictly implemented.

b.4 All calls from landlines to cellphones and


vice versa must be strictly monitored, minimized
and resorted to only in urgent/emergency
cases, subject to prior approval of the head of
office. All calls from NFA issued cellphone to
another cellphone of the same network is
encouraged. Executives with NFA issued
cellphone should allow his/her staff to use the
cellphone for official purposes.

b.5 Request for pre-paid cards by


officials/employees who already have NFA-
issued cellphones shall not be allowed.

b.6 Use of e-mail is highly encouraged rather


than sending messages through fax. All
communications through e-mail shall be sent
through the official e-mail address of the Head
of Office as listed in the NFA directory, and
shall be considered official and need not be
sent in hard copy or signed copy, unless
required.

c. ELECTRICITY

c.1 Lights

Use energy efficient lights (LED, CFL)


Light Emitting Diode; Compact Fluorescent Lamp
instead of incandescent bulbs.
Take advantage of natural light whenever
possible.
Clean light bulbs regularly.
Switch off lights when not in use, specially
in comfort rooms, conference rooms, etc.
Lights should be turned-off during lunch
break (12:00 to 1:00pm), except for areas
designated for receiving of

documents and visitors in compliance


with the no noon break policy.

All lights should be turned-off before


leaving the NFA office. Security Guards
should ensure that lights are turned-off
when employees have left the office.

c.2 Electric Equipment

Unplug all electric equipment


(personal computers, electric fans,
printers, etc.) before leaving the
office premises at the end of office
hours. Security Guards should
ensure that all equipment are
unplugged when employees have
left the office.
For executive offices or any
enclosed offices, turn-off
airconditioners whenever occupant
goes out for more than one (1)
hour.
Choose airconditioners with
appropriate horsepower. Buy
airconditioners with high EER
(Energy Efficiency Ratio). If
possible, purchase inverter
airconditioners. Always set
thermostat at the right level.
Ensure that all entrance and exit
doors are closed to preserve the
cool temperature inside the office.
Computer shall be strictly for official
use only. CPMSD shall ensure that
energy saving features of all
computers are set to on before
deployment.
Operation of airconditioning units
shall be from 9:00am to 4:00pm
only.
Hot and cold dispensers shall be
turned on from 7:00am to 5:00pm.

c.3 For central office, only one (1) elevator shall be


operated from 12:00 to 1:00pm. No elevator shall be
operated from 8:00pm to 7:00am of the following day.

c.4 Cooking inside office premises shall be strictly


prohibited.

c.5 Only employees authorized to render overtime


services are allowed to stay in office premises at the
close of office hours or during weekends. The
employees authorized to render overtime services or
with Daily Overtime Authorization Slip (DOAS) shall
be the basis of the Security Guards to allow personnel
in the office premises after office hours or during
weekends (per SOP on Overtime Services).

d. WATER

d.1 Report to GSD/AGS leaking faucets/pipes.


d.2 Observe water conservation (e.g. use glasses
while brushing teeth, ensure that toilet flush is
properly in place before leaving the toilet, no washing
of clothes in office comfort rooms, etc.)

e. GAS AND OIL FOR SERVICE VEHICLE

e.1 Use of service vehicles should be limited for


official purposes only.

e.2 Fuel shall not be issued to privately owned-motor


vehicles. Likewise, no reimbursement for the cost of
gasoline and oil shall be allowed where a private
vehicle is used for the official travel. However,
reimbursement of the equivalent cost of the
customary mode of transportation may be allowed
provided prior authorization for the use of a private
vehicle is secured as reflected in the travel authority.

e.3 Service vehicles should be turned-off, including


radio, while in the parking lot.

These guidelines shall take effect upon approval.

For your guidance and strict implementation.

(SGD) LT. COL. JASON L.Y. AQUINO, (RET.) PA

III. RESPONSIBILITIES

IV. FLOW CHART


Top Page
EXHIBITS
No Exhibit/s Available for this SOP
SOP Library
SOP NO: HR-PB07 (List of Exhibits/Attachments)

Mission: Finance and Administration


Area: Human Resource (HR)

Activity: Personnel Benefits and Services (HR-PB)

Title: Group Hospitalization Insurance Program for NFA Personnel

Date Approved/Issued: 08/26/1986

Date Effective: 08/01/1986

Digest:

I. TERMS OF REFERENCE
A. Rationale
B. Objective
C. Scope
D. Basis

II. IMPLEMENTING GUIDELINES

III. RESPONSIBILITIES

1. Coverage
The Group Hospitalization Insurance Program for NFA Personnel
is an insurance package which provides that an insured/member
can avail of medical assistance for any disability requiring
confinement of at least six (6) hours in ay duly licensed
hospital/clinic and with 24-hours nursing service based on the
actual, necessary, reasonable and eligible hospital/cclinic charges
in excess of the MEDICARE, but in no case to exceed the various
limits specified in the SCHEDULE OF BENEFITS.

2. Elibility
2.1 All regular and casual full-time employees of the NFA and
NFA-COA personnel who are between the ages of 18 to below 65
yearss old, legitimate, legitimated, recognized natural children,
stepchildren, legally adopted or foster children who are between
the ages of 2 weeks and 23 years, unmarried, not gainfully
employed, and totally dependent upon the employee for support.
2.2 For single employee-parent/s who are below 65 years old and
not gainfully employed living with totally dependent upon the
insured for support.
3. Date of Eliigibility

Each individual shall become eligible on the following dates:

Eligibility Date

3.1 Those who employment commenced on or prior August 1, 1986


to August 1, 1986 to duty

3.2 Those whose employment commenced after August Date of


Entrance
1, 1986.

4. Effective Date of Individual Insurance


The insurance of an individual shall take effect on his eligibility
date, provided the employee is then actively at work for NFA/NFA-
COA. Otherwise, the insurance shall take effect on the first day of
the month coincident with or immediately following the employees
return to active full-time work.
5. Eligible Hospital/Clinic Charges
The Insurance Program shall cover the following benefits which
maybe authorized provided those have been utilized for treatment
of the insured/member.

5.1 Basic Medical Benefit:


This benefitt provindes for the payment of expenses
incurred by an insured person when confined as a patient in
a legally constituted hospital or clinic uopn the
recommendation of a legally licensed physician/NFA
Physician or surgeon, as a result of a covered illness or
injury.

i. Room and Board Benefit -


This coverers the daily charges actually incurred for
room and board by the member as a registered bed-
patient during hospital confinenment up to the dailly
limit specified in THE SCHEDULE OF BENFITS. It
includes charges for room accomodation, food service
and routine nursing care.

The total amount payable is determined by multiplying


the rate of daily benefit by the number of days of
confinement.
ii. Special Hospital Services Benefit -
This covers the charges for hospital and mechanical
services and supplies necessary for the treatment of
the illness or unjury for which the member is
hospitalized up to the maximum limit set forth in the
SCHEDULE OF BENEFITS, as

* x-ray examanition, electroccardiogram, basal


metabolism, etc.:

* laboratory services;

* medicines, drugs, and dressings administered:

* operating room, treatment room;

* anesthesia amd its administration;

* transfusion including the cost of blood or plasma


provided by the hospital; and

* ambulance services (only for accidents)


5.1.2. Surgical Expenses Benefit:
This covers the professional fee charged by aa
licensed surgeon who performed the surgical
ooperation on the insured. This benefit is payable
evven if there is no hospital confinement.

The benefit payable shall be the amount shown in the


SCHEDULE OF OPERATIONS corresponding to the
surgical operation that was performed. (Annex 1 & 2).

Limitations -

a.) If a person is attended by two or more physicians,


the benefit shall be the same as if be had been
attended by one only.

b.) If two or more operations performed in the course


of a single surgical procudure, only the benefits
corresponding to the most costly among them shall be
paid.

c.) If a single operation is performed in two or more


steps, such operation shall beconsidered as one only.

d.) If sn operation not shown in the Schedule of


Operations is performed, the Insurance Company
reserves the right to determine the maximum benefit
to be allowed for such operation. An operations of
comparable or quivalent pravity abd severity will be
used as basis for the company's settlement.
5.1.3. Daily In-Hospital Physician's Visit Benefit:
This covers the professional fee charged by a
licensed physician for attending to the medical needs
of the INsured during hospital confinement.

The total amount payable is determine by multiplying


the rate of daily benefit by the number of days of
confinement up to the "per visit" limit as indicated in
the SCHEDULE OF BENEFITS.
5.2 Major Medical Expenses Benefits
The Major Medical Expenses Benefit provided that an
Insured shall be reimbursed of expenses for any ability
requiringg confiinement of at least 6 hours in any duly
licensed hospitals or clinics based on the actual, necessary,
reasonable and eligible hospital charges, in excess of the
Medicare and Basic Medical Benefits and the Corridor
Deductible, but in no case to exceed the various maximum
limits specified in the SCHEDULE OF BENEFITS.

5.2.1. Maximum Disability Benefit :


The Maximum Disability is the maximum
amount of the Major Medical Expenses benefit
payable to anyone Insured in respect of any
one covered disability as the amount stated in
the SCHEDULE OF BENEFITSfor any one or
more Benefit Period.

5.2.2. Maximum Surgical Benefit :


The Maximum surgical Benefit is the maximum
amount of such Major benefit less any surgical
benefits paid under the Government "Medicare"
Medical Insurance and the Basic Medical
Benefit Plan.
5.2.3. Corridor Deductible:
Corridor Deductible is the aggregate of eligible
medical expenses incurred on account of each
disability in a continuous period not exceeding
three months, which shall be personally borne
by the Insured/Memcber before any Major
Expenses benefits becomes payable. The
Deductible Amount is the fixed Deductable
stated in the SCHEDULE OF BENEFITS.

A new Corridor Deductable shall apply if a


seperate disability is established whenever
injury or disease:

a.) is due to a cause unrelated to a prior or


concurrent disability;

b.) commences after complete to recover from a


previous disability; and

c.) exist or recurs after any period of three


months.
5.2.4. Co-Insurance:
The share the insured/member has to shoulder
in the expenses incurred for hospitalization is
10%. This is to keep the insure/member
interested in the extent of treatment and in
controlling hospital expenses.
5.2.5. Inner Limits:
a.) ROOM AND BOARD, MAXIMUM PER DAY
- is the maximum amount of such Major Medical
benefit less any Room and Board Benefit paid
under the Basic Medical and Government
Medical Plans.

b.) DAILY IN-HOSPITAL PHYSICIAN'S VISIT;


PER DAY - is the maximum amount of
such Major Medical benefit less any Daily
Physician's Visit Benefit paid under the
Basic Medical and Government Medicare
Plans.
c.) DAILY NURSE's FEE, PER DAY - is the
maximum amount of a registered graduate
nurse performimng private nursing duty other
than a family member.

d.) PROFESSIONAL AMBULANCE SERVICE -


as an emergency transportation from place od
disability to the nearest hospital.
5.2.6. ANESTHESIOLOGIST'S FEE;
The maximum amount payable for the services
of an anesthesiologist.
5.2.7. OPERATING ROOM FEE;
The maximum amount payable for the use of
operating room.
5.2.8. Other Eligible Expenses;
The following medical expenses are eligible if
they are reasonable charges for necessary
services and supplies incurred in a licensed
hospital;

a.) Special hospital services and supplies, such


as x-ray and laboratory examination and other
diagnostic examinations and the cost of
snesthetics, oxygen and blood transfussions
including the supply of blood and plasma.

b.) Drugs and medicines prescribed by a


physician and administered in the hospital.

c.) Purchase ofprosthetic appliances or


equipment as an artificial limbs or eyes, casts or
trusses, braces or crutches and other similar
devices, except replacement of such devices.

d.) Rental of equipment such as wheel chair,


hospital bed, iron lung or other mechanical
equipment required for the treatment of
respiratory paralysis.

e.) Professional fees charged by a surgeon and


anesthesiologist with respect to surgical
procudures but not exceeding the limits
providedd in the Schedule of Operations.
5.3 Maternity nad Obstetrical Benefits
This benefit is in lieu of all the other benefits under the plan
and covers hospital expenses incurred as a result of
childbirth subject to the limits stated in the SCHEDULE OF
BENEFITS.

Maternity andobstetrical benefits cover the following eligible


maternity expenses incurred by a legally married individual.

5.3.1 Room and Board

5.3.2 Special Hospital Services (including the use of labor


or delivery room) and charges made by an anesthesiologist.

5.3.3 Obstetrical fees for normal, caesarian or home


delivery, abortion and miscarriage.

Maternity and obstetrical benefits, however, are not payable


for childbirth occuring;

a.) Within (8) months from the effective date of the


individuals insurance for normal and home delivery,
EXCEPT where the individual has been insured hereunder
continuously from the time She first became eligible for
insurance.

b.) After the termination of the individuals insurance,


EXCEPT where pregnancy occured prior to the termination
of her insurance hereunder and that such termination was
not due to non-payment of premium while she remains in
the service of the Policyholder, and while this Policy is in
force.
6. Schedule of Benefits
The amount/extent of benefit to be granted shall cover the actual
expenses incurred by the insured/member but not to exceed the
following limits per item-benefit.

6.1 BASIC MEDICAL BENEFITS


1. Hospital Expenses Benefits

a.) Room & Board (max. of 31 days) P 60.00/day

b.) Special Hospital Services, 100%


of actual charges up to a maximum of 600.00

2. Surgical Expenses Benefits

according to Schedule of Operation maximum of 1,900.00

3. Daily In Hospital Physicians Visit for 31 days 40.00/day

6.2 MAJOR MEDICAL EXPENSES BENEFITS

Maximum Benefits 10,000.00


Surgical Maximum of 5,000.00
Anesthesiologist's fee-30%
of eligible Surgeon's fee
maximum of 1.500.00
Operating Room Fee - 25% of
eligible Sugeon's fee
maximum of 1,250.00
Corridor Deductable 100.00
Co-Insurance 90%/10%

Inner Limits:

Daily Room & Board/day plus basic 60.00/day


Physician 's Hospital Visit/day plus basic 50.00/day
Nurse's Fee 50.00/day
Ambulance Fee 300.00

6.3 MATERNITY-OBSTETRICAL BENEFITS

Daily Room & Board for six (6) days 75.00/day


Special Services, Actual charges up
to a maximum of 800.00
Anesthesiologist's Fee 800.00

Obstetrical Fee:

Normal Delivery 1,000.00


Caesarian Section or Ectopic 2,500.00
Abortion or Miscarriage 800.00
Home Delivery 500.00
7. Limitations
The medical expenses for the following shall not be considered as
eligilbe expenses for this Insurance Program, hence such charges
shall not be payable:

7.1 Basic Medical Exclusions


7.1.1 Cosmetic surgery for anesthetic reason or plastic
surgery expect for the or alleviation of change caused solely
by accidental bodily injuries.
7.1.2 Use of acquisition of presthetic appliances or special
brances such as artificial limbs, hearing aids, eye refraction
for fitting of eye glasses or contact lenses.
7.1.3 Any dental treatment or surgery, except dental
operation to repair injury sustained in an accident.

7.1.4 Treatment or any mental an nervous disorder such as


phychosis, schizophrenia and others. any treatment arising
from alcohol or drug addiction.
7.1.5 Physician check-up for diagnostic purpose treatment
or surgical operations for congenital deformities such as
harelip, clubfoot, cerebral palsy and others, for physical
therapy, x-ray , radium, cobalt or for recuperative purposes
such as confinement in a sanitarium or convalescent home.
7.1.6 Veneral disease or for treatment of communicable
diseases such as smallpox, cholera, bubonic plaque, etc.
7.1.7 Sickness due to birth control preparation or conditions
resulting from any one of them; sterilization of either sex
such as castration, vasectomy, tubectomy and tubal
ligation.
7.1.8 Confinement due to pregnancy or resulting childbirth
(normal or caesarean),abortion or miscarriage or any
complication thereof.
7.1.9 Private nursing services, supplemental food and
medicines as vitamins and minerals, extra accommodation
and non-medical personnel appliances such as radio,
telephone, Tv, refregerator and the like.
7.1.10 Sickness or injury sustained or contracted in riot, civil
commotion, insurrection or war or any act of war, or service
in any military, naval or air force of any country while such
country is engaged in war; bodily injury sutained while
travelling in or any aerial or submarine device except as
passenger in a certified passenger aircraft provided by a
commercial airline an any regular and scheduled passenger
trip over its established passenger route.
7.1.11 Sickness or injury caused by self destruction or any
attempt thereat, atonic explosions, nuclear fission, or radio-
active gas or to taking, inhaling or absortioning of poison,
gas orr fumes, unless involuntery or accidental.
7.1.12 Hospitalization, services or treatment in a hospital or
in any institution , operated by any authorized civic
organization or agency where such confinement; are
services or supplies are provided fee of charge.
7.1.13 Hospitalization services not in accordance with the
diagnosis and treatment of the conditions for which hospital
confinement is required or which have not been previously
recommended by a legally licensed physician or surgeon or
not approved by the Company.

7.2 Major Medical Exclusions


The exclusions applicable to Basis Medical shall be
applicable to Major Medical Expenses benefit as modified or
cancelled by the provisions of Major Medical benefit.
In additional, the following services, products, or conditions
shall not be considered as elugible expenses.

7.2.1 Those not included in the Eligible Expenses stated


herein; or

7.2.2 Those not related with the diagnosis and treatment of


the condition for whhich hospital confinement is requred by
the attending physician; or

7.2.3 Those not recommended, approved and certified by a


physician as necessary or reasonable; or

7.2.4 Those rendered or received in any facility where care


is provided without charged; or

7.2.5 Those that are paid for or provided by any other


service or medical pre-payment plan to the extent so piad or
provided; or

7.2.6 Those in connection with pregnancy, resulting


childbirth, prenatal or postnatal care, miscarriage or
Caesarean Section, except expenses incurred for medical
services and supplies performed for prescribed on account
of the follwing complications of pregnancy;
a.) Toxenia of pregnancy
b.) Exlampsia of pregnancy
c.) Extra-uterine pregnancy or Ectopic
d.) Hyperensis gravidarum
e.) Hydratidiform Mole
7.2.7 Those expenses resulting from any services or
supplies for which no reimbursement or payment is required
on account of the insured person receiving them.
7.3 Maternity and Obstetriical Exclusion
7.3.1 Diagnostic services if confined less than six (6)
consecutive hours
7.3.2 Services of Special Nurses
7.3.3 Telephone Services
7.3.4 Medical Treatment
8. Other Features of the Group Hospitalization Insurance Program
8.1 Maximum Benefit per Disability/Confinement
8.1.1 The Insurance program allows and Insured/member to
enjoy a seperate and distinct mwximum benefit per
disablility.confinement.

8.1.2 However, two or more related disabilities shall be


considered as one disability unless confinement resulting
therefrom are continuously seperated by a period of two (2)
weeks for the Principal Insured and six (6) months of a
dependent.
8.2 Out-Patient Benefit
Surgical Expenses Benefit and Special Hospital Services
Benefit is also available for actual expenses incurred as an
out-patient for emergenxy treatment due to an accident or
surgical treatment.
8.3 Benefits Extended to Seperated Individual:
The benefits of the plan shall extended to a seperated
individual while the Group Master Policy is still in force, to
cover necessary hospital expenses incurred within three (3)
months after the termination of his insurance and subject to
the following;

1.) That such confinement is due to an accidnetal injury


occuring or sickness disease commencing before the date
of termination of his insurance.

2.) That an insured individuals has been continuously


disable because of such injury, sickness or disease before
the date of termination of his insurance until the date of hisd
confinement.
In no case shall this extension of benefit be longer
than three months from date of termination of
insurance.
9. Settlement of Claims
9.1 The Group Hospitalization Insurance Program shall be
administered by the Personnel Benefits Division, HRMD in tie-up
with Grainscor. Both shall maintain close coordination with the
Insurance Company to ensure immediate payment of claims.

9.2 The Insuarance Company and the NFA shall maintain a tie-up
woth duly accredited hospitals/clinic wherein direct payment by
the Insurance Company to the latter can be made possible.

9.3 Direct Payment tie-up shall be extended only to the principal


insured and shall be accepted for confinement by the duly
accredited hospital/clinic only upon proper endorsement by the
Agency.
In times of emergency and during Saturdays, Sundays, and
holidays when it is impossible to secure an endorsement
from the office, the employee concerned can present this
NFA identification card (ID) upon confinement.

However, proper endorsement from the office shall still be


presented to the hospital/clcinic as a requirements for the
direct payment tie-up.
9.4 The Insurance/member can shoulder the medical expenses
incurred and subsequently file hospitalization insurance claim
through reimburesement procedure.

9.5 Requirements in filling cliams shall be as follows;


9.5.1 Medical Certificate

9.5.2 Statement of Hospital Accounts/Itemized List of


Hospital charges

9.5.3 Official receipts charge ticket of professional fees,


medicines, services, etc;

9.5.4 Hospitalization Claim Form

9.5.5 Medicine Prescription

9.5.6 Itemized Medicare Deductions

9.5.7 Certificate of Employment of Service Record


9.6 The Principal insured availing the direct payment tie-up shall
be required to settle ten percent (10%) of the total hospital bill.
This shall represent the average amount chargeable to the
concerned employee in excess of the hospitalization insurance
benefit and the Medicare.
However, should the allowable hospitalization benefits
cover the actual expenses incurred by the provincial
insured, the 10% amount shouldered by the said employee
shall be reimbursed accordingly
9.7 The principal insured availing the direcy payment tie-up be
held liable for any amount in excess of the hospitalization benefits
and the MEDICARE.
In case where the 10% of the total hospital bill shouldered
by the employee is insufficcinet to cover the excess amount,
the said employees shall be demanded to settle direct to the
hospital the actual balance due him fifteen (15) days upon
receipt of demand letter from PBD, HRM.
10. Rate of Premium Under the Plan
10.1 The Premium Cost shall be shared by the NFA and the
employee on a 90%/10% basis under the following Insurance
classification schedule;

NFA EMPLOYEE
Share Share Total

I - Married (no limitation as to the number


of dependents 496,49 55.17 P551.65
1.

II A - Single with both parents as dependents 426.42 47.38


473.80

II B - Single with one parent as dependents 303.93 33.77 337.70

II C - Single without dependent 131.44 20.16 201.60

10.2 In cases where spouses are both NFA employees, only the
husband being the head of the family will pay the said preium
rate.

10.3 The premium cost for newly-hired employees whose date of


entrance to duly falls on a date later than the start of the policy
year shall be prorated.
11. Deduction of Employee Share
11.1 The share of a newly hired employee shall be deducted from
his first salary/wage through voucher. Accounting and Budget
shall deduct the premiums.

11.2 Deduction of Renewal Premuims


Central Office
11.2.1 Renewal Premiums shall be deducted in March
computerized payroll remiums of casual employees
shall be collected in two (2) equal payments, 50%
from wages and 50% from allowances. However,
premiums of regular employees shall be collected in
one payment only.

Field Office

11.2.2 Renewal Premiums of both regular and casual


employees shall be deducted in full in March payroll.
12. Remittance of Premium Payments
12.1 Payment of premiums of the NFA and the employee share
shall be remitted to the Insurance Company thru Grainscor.

12.2 Premiums of newly hired employees shall be remitted to


Grainscor within fifteen (15) days from the date of deduction from
the payroll.
12.3 Payment of premiums for renewal of coverage shall be
remitted to Grainscor on or before April 15 for Central Office and
Field Offices.
13. Accounting Entries
13.1 Deduction of employee's share
DR: Salaries/Wages/Allowances xxx
CR: Accounts Payable BIR, etc. xxx
CR: Trust Liability-GHIP (Group
Hospital Insurance Program) xxx
13.2 After deduction, prepare voucher for
remittance of total premium payment

DR: GHIP Expenses (NFA share) xxx


DR: Trust Liability-GHIP(Employees
share) xxx
CR: Voucher Payable xxx
13.3 Preparation of check
DR: Voucher PAyable xxx
CR: Cash in bank xxx
IV. DETAILED RESPONSIBILITES
A. Regional/Provincial Administrative Officer/ RAO-06/PAO-09
Reporting

1. Prepares List/Roster of Eligible personnel in four (4)


copies (Exh.1) identifying Insurance classification thereat.
Copy 1 - Insurance Company
2 - Grainscor
3 - Accounting
4 - File

2. Furnishes employees with Dependent/s Designation


Forms (Exh.2) and submits thesame PSD, HRM/Grainscor.

3. Reports changes on insurance coverage (Exh.3) due to


new hires and change in status, resignation, termination
and/or retirement of the Insured/member.
Copy 1 - Insurance Company
2 - Grainscor
3 - Accounting
4 - File

4. Duties List/Roster of Eligible Employee upon renewal of


Insurance policy and/or upon request by concerned office/s.

Claim Settlement

Assists Insured/member employee in the settlement of


hospitalization claim.

B. Head Office RD-19/PM-50


1. Certifies correctness of the List/Roster of Eligible
Personnel prepared by AO/AA concerned.

2. Certifies correctness of the report on changes on


insurance coverage prepared by AO/AA concerned.
C. Insured/Member Employee
Reporting

1. Accomplish Dependent/s Designation Forms. Submits


the same to AO/AA concerned.

2. Reports to AO/AA concerned change in status and/or


Change of Dependent/Coverag, accomplished applicable
from (Exh.4).

Claim Settlement: Reimbursement

1. Secures and accomplishes Request for Reimbursement


(Exh.5).

2. Secures Group Hozpitalization Insurance Benefit Cliam


Form (Exh. 6) form PBD, HRM (C.O.)/ Administrative
Section (F.O.) and accomplishes form as follows:

Part I - Clainmant (Insured/member employee)


II - Employer
III - Attending Physician

3. Submits the following requirements together with the


above accomplished form to PBD, HRM/Administrative
Section for reimbursement of hospital expenses.
3.1 Medical Certificate
3.2 Statement of Account from Hospital/Itemized List
of Hospital Charges
3.3 Official Receipts/Charge tickets of Professional
fees, medicines, services, etc.
3.4 Medicine Prescriptions
3.5 Itemized Medicare deductionss
3.6 Certificate of Employment or Service Record

Claim Settlement : Direct Payment Tie-up

1. Request for Endorsement for Direct Payment Tie-


up (Exh. 7) under the Insurance Program from PBD,
HRM (C.O.)/Administrative Section (F.O.) and
presents to the accredited hospital/clinic.

2. Secures and accomplishes Group Hospitalization


Insurance Benefit Claim Form.

3. Chicks/evaluates the verecity of the hospital


expenses indicated in the Statement of Hospital
Accounts.

4. Pays 10% of the total amount of hospital bills in


excess of the MEDICARE upon discharge from
hospital clinic. Presents corresponding Official
Receipt to PBD, HRM as basis for reimbursement, if
any.

5. Pays additional amount in excess of the


MEDICARE and the hospitalization benefit within
fifteen (15) days upon demand by Personnel Benefits,
HRM if the 10% amount of the hospital bill shouldered
is insuficient to cover the actual balance due him.

6. Reimburses from Insurance Company the 10%


amount of the hospital bill shouldered if the alllowable
hospitalization benefit covers the actual expenses
incurred.
D. Personnel Benefits Division (PBD), HRM
Reporting

1. Forwards to Grainscor the Dependent's Designation


Forms accomplished by the employees.
2. Records amount of hospitalization benefits granted for
monitoring purposes.

Claim Settlement: Reimbursement

1. Checks/Examinies the Completeness/authenticity of the


requirements submitted by the Insured/member for
reimbursement of hospital expenses as listed in the
Request for Reimbursement form.

2. Accomplishes Part II of the Group Hospitalization


Insurance Benefit Claim Form.

3. Endorses and transmits the above document to the


Insurance Company thru Grainscor.

4. Coordinates with Grainscor and the Insurance Company


to effect immediate settlement of claims.

5. Checks and evaluates the computed amount of benefit


granted based on the allowable expenses per item-benefit
as indicate in the Group Hospitalization Claim Data and
Action Sheet. (Illustrative Examples for surgical/non-
ssurgical sickness/injury in Exh. 8-A/8-B).

6. Forwards check payment to the employee concenred.

Claim Settlement: Direct Tie-up

1. Issues Endorsement for Direct Payment Tie-up to


Insured/member employee.

2. Checks and Evaluates the completeness/authenticity of


the Statement of Accounts, and other supporting documents
forwarded by the Hospitalization for payment by the
Insurance Company.

3. Accomplishes Part II of the Group Hospitalization


Insurance Benefit Claim Form.

4. Endorses and trnasmits the above documents to the


Insurance Company thru Grainscor.
5. Coordinates wiht the Insurance Company and Grainscor
to effect immediate payment to the hospital concerned.

6. Upon receipt of claim for hospitalization benefit from the


insurance company.
6.1 Sends demand letter (Exh. 9) to the employee
concerned to settle additional amount to the hospital,
if the 10% amount of the hospital.

6.2 Assists in selecting hospital/clinic which


specializes in the concerned employee's
sickness/injury.

6.3 Visits employee-patient at the hospital as when


necessary.
G. Accounting
Collection and Remittance of Premium

1. Deducts Employee Premium share from salary/wage on


scheduled month/s

2. Prepares Statement of Remittance nad voucher.


H. Treasury
1. Prepares and release check for payment of premium to
the Insurance Company.
I. MSD - EDP
1. Deducts the Group Hospitalization Insurance renewal
Premium in March computerizd payrokk.

2. Generates the Group Hospitalization Insurance


Remittance List in four (4) copies and forwards to
Accounting.
J. NFA - COA
1. Prepares List/Roster of Eligible NFA-COA personnel,
Forwards to GRAINSCOR, (C.O.)/Administrative Section
(F.O.) together with the Dependent's Designation Forms
accomplished by the employees.

2. Prepares and forwards changes in List/Roster of eligible


personnel due to new hires and change in
status/resignation/retirement to concerned office/s.
3. Deducts employee share and remits to
Grainscor/Insurance Company.

IV. FLOW CHART


Top Page
EXHIBITS
No Exhibit/s Available for this SOP
SOP Library
SOP NO: HR-PB08 (List of Exhibits/Attachments)

Mission: Finance and Administration

Area: Human Resource (HR)

Activity: Personnel Benefits and Services (HR-PB)

Title: Fidelity Bond Application for Accountable Officer

Date Approved/Issued: 12/23/1986

Date Effective: 01/01/1987

Digest:

I. TERMS OF REFERENCE
A. Rationale
B. Objective
C. Scope
D. Basis

II. IMPLEMENTING GUIDELINES

1. Neccesity to Bond NFA Accountable Officials and Employees


NFA accountable officials and employees shall be bonded to
ensure: (1) faithful performance of all duties imposed by law upon
them; (2) faithful acocunting of all funds and public property
coming into their possession, custody or control thru
appropriation, collection, transfer or otherwise; (3) lawful payment,
disbursement and expenditure or transfer of all such funds or
public property under their custody and control as accountable
officers or employees.
2. Purpose of Fidelity Bond
The Fidelity Bond shall be for the purpose of replacing
defalcatuions, shortages, payment of court fees, incident to civil
proceeding brought against the defaulting accountable officer to
recover sums paid by NFA on their account.
3. Bondable NFA Officials an Employees
3.1 Regular NFA employees who are appointed or designated to
the folloewing accountable positions and are actually performing
the functions attached to these positions:

a. Warehouse Supervisors
b. Cashiers
c. Sr. Disbursing Officers/Disbursing Officers
d. Supply Officers/Property Custodians
e. Other positions holding accountabilities

3.2 Plant Engineers, Sr. MPCs. regular MPOs shall be bonded as


to their accountabilities on stocks-in-process.

3.3. Bonding of NFA Cnetral Office/and Field Office Key Officials,


either appointed or designated to these ppositions, shall be
undertaken only upon the discretion of COA basing on the officials
needs to perform specific functions similar to that of the identified
accountable positions.

3.4 Casual employees who are to be bonded shall include only


those designated as Special Disbursing Officers for grains
procurement operations only in case of urgent need in the
exigency of the service.

3.5 No bondable official/employee shall be allowed to hold


accountabilities unless his bond has been approved.
4. Appointment or Designation of NFA Accountable Officials and
Employees
4.1 Every head of office shall exercise utmost discretion in
appointing or designating officials and employees to accountable
positions. They shall see it that those appointed or designated to
such accountable positions are unquestionnable conduct abd
character as well as proven integrity.
4.2 Designation shall be undertaken in any of the following
circumtances:
a. resignation or transfer of the incumbent accountable
officer/employee to another without immediate replacement
for that position.
b. no existing positions in the plantilla of the
office/directorate but same are needed for particular
purposes.

c. leave of absence of the incumbent fro at least two (2)


months or indefinite leave due to suspension for any
criminal or administrative charge.
4.3 Designations to accountable positions shall be effected with
the issuance of Special Order by the Minister or the Regional
Director for Central Office and Field Office, respectively. Request
for Special Order shall be made at least one (1) month prior to
asssumption to duty for Central Office bondable officers and at
least one and a half months prior to assumpton to duty shall
Office bondable earlier than the approval of his bond.
5. Cancellation of Fidelity Bonds
5.1 Fidelity Bonds shall be cancelled due to anny of the following
reasons.
a. retirement/resignation from service of the incumbent.

b. separation for cause from the service.

c. designation to non-acocuntable positions.

d. change in position title thru promotion/demotion.

e. termination of Special Order (SO) for specific project.

f. relief from accountability.


5.2 Cancellation of fidelity bonds of these bonded
officials/employees shall be undertaken immediately once final
liquidation of their accountabilities has been intiated by COA. The
Provincial Manager/Regional Director/Head of Offic shall
undertaken necessary actions to expedite the liquidation process.

5.3 Every head of office shall see to it that officials and employees
whose fidelity bonds have been cancelled are relieved of their
accountabilities.
6. Amount of Bond
6.1 Cash Accountability
Range (in Pesos) Amount of Bond
_____________ _____________

P 500 - P 1,000 P 500


1,001 - 3,000 1,000
3,001 - 5,000 3,000
5,001 - 7,000 5,000
7,001 - 9,000 7,000
9,001 - 12,000 9,000
12,001 - 15,000 10,000
15,001 - 18,000 13,500
18,001 - 21,000 16,200
21,001 - 25,000 18,900
25,001 - 30,000 20,000
30,001 - 35,000 24,000
35,001 - 40,000 28,000
40,001 - 50,000 32,000
50,001 - 60,000 35,000
60,001 - 80,000 42,000
80,001 - 100,000 56,000
100,001 - 250,000 60,000
250,001 - 500,000 150,000
500,001 - 750,000 250,000
750,001 - 1,000,000 375,000
1,000,001 - 5,000,000 500,000
5,000,001 - 25,000,000 1,250,000
25,000,001 - 75,000,000 2,500,000
75,000,001 - 100,000,000 (& over) 3,750,000
6.2 Property Accountability

Amount of Bond
____________
a. Supplies and Materials - 50% of the total value.

b. Equipment 30 % of the total value (amount rounded off to


be divisible by 100)
6.3 Accountable Forms Accountability 5% of their total face value
This shall include all NFA acocunta- (amount rounded-off to
be visible by 100)
ble forms having face value used in
grains and non-grains transaction
6.4 If an accountable officer/employee handles mixed
accountabilities, only one application shall be made but with
separate computation for each accountability (e.g. Supply
Officer/Property Custodian with property and accountable forms
accountability, or MOT with cash and stock accountability.

6.5 Grains/non-grains stocks and empty sacks shall be classified


under property accountability. Computation shall follow the
formula used for supplies and materials.
7. Premiums Payable
Annual premiums to be paid shall be conmputed as follows:
one-half (1/2) of one (1) percent of the total amount of bond.

Example: Amount of bond = P10,000

Premium Payable = 1/2 (.01 x P10,000)


per year = P50,00

Premium Payable = 1/4 (.01 x P10,000)


per Semester = P25.00
8. Criteria in Determine Amount of Accountability
Accountable Officer/Employee Accountability

a. Supply Officer/Property Custodian - Total value of all


supplies/materials and accountable forms under accountability.
This shall be based on the average monthly inventory level during
the last year computed based on the book value of
supplies/materials.

b. Warehouse Supervisor - Total value of stock based on the


average monthly balance of the warehuose during the last year.
Aggreaget total shall be determined if the WS II handles more
than one warehouse. Costing shall be based on the value of
stock.

c. Casheir/Sr. Disbursing Officer - Total Cash Accountability.

d. Plant Engineer/Sr. MPO/MPO II - Based on the average weekly


balance during the last year of sotcks on process at
Ricemill/Drier/Silo being handled (refer to SOP No. GM-PG01).
Costing of stocks shall be based on book value.
9. Filing and Processing of Fidelity Bond Application
9.1 All bondable officials and employee are required to submit
their Application for Bond (Gen. Form 58A, Exhibit 2) to the
Administrative Officer/Assistant at least 3 weeks (for C.O.)/4
weeks (for C.O.) prior to holding of accountasbility. The following
shall be supporting documents.
a. Xerox copyy of approved appointment;
b. Xerox copy of Special Order in case of designation, either
as acting or concurrent Accountable-Officer;
c. Latest Statement of Assets and Liabilities; and
d. Picture (3"x4") per application form.
9.2 The Administrative Officer/Assistant shall be responsible in
seeing to the completeness of the forms and supporting
documents.

For Central Office

9.3 The Director/Head of Office shall sign request for bonding of


accountable officers/employees.

9.4 Application and Request for Bonding shall be endorsed to


Finance, Cash Division for review particularly in the determination
of the amount of accountability and the recommended amount of
bond. The Finance Director shall sign the "First Indorsement"
portion.

9.5 The above shall be forwarded to NFA-COA for processing and


for fixing the amount of bond of the office/employee. The
Corporate Auditor shall sign under the 'Second Indorsement'
position.

9.6 From NFA-COA, documents shall be returned to Finance,


Cash Division for submission to the Bureau of Treasury.

For Provincial Office

9.7 The branch accountant shall evalaute the application


particularly in the determining of amount of accountabiblity and
the recommended amount of bond.
9.8 The Provincial Manager shall sign request for bonding of
acocuntable officers/employees.

9.9 Application and Request for bonding shall be forwarded to the


Branch Autidtor for verification and processing which shall include
fixing the amount of bond of the official/employee. He
shallhenceforth initial the 'Second Indorsement' portion of the
bond request.

9.10 Signatories to the 'First Indorsement' shall be the Regional


Director' 'Second Indorsement' shall be signed by the Regional
Auditor'

9.11 The above documents shall be forwarded by the Regional


AO to Finance/C.O. for submission to the Bureau of Treasury.
Such should be received by DTFM at least 10 days prior to
holding of accountability.

9.12 It shall be the responsibility of Finance/Cash Division to


follow-up request submitted to Bureau of Treasury. Approved
bond rerquest shall be wired immediately to concerned office.

For Regional Office

9.13 Request for bonding of Regional Officals/employees shall be


signed by the Regional director. He shall likewise be the
signatoree on the 'First Indorsement' and the Regional Audito on
'Second Indorsement'. (It shall follow same procudure as above.)
10. Bond Cancellation
10.1 For bond cancellation only appropriate portion in Form 57A
shall be accomplished and no supporting documents are required.
(Refer to Annex A for detailed instructions).

10.2 For Central Office, bond cancellation shall be requested by


concerned Director/head of Office, 'First Indorsement' by Finance
Director and 'Second Indorsement' by NFA-COA Corporate
Audiitor.
For Provincial/Regional Office, a wire request shall be
sent immediately to Finance for bond cancellation
stating data as required in the form. Finance shall
prepare Request for bond cancellation for signature
by HRMD Director. 'First Indorsement' by Finance
Director and 'Second Indorsement' by NFA-COA
Corporate Auditor.
10.3 Finance/Cash Division shall be responsible in transmitting all
documents to the Bureau of Treasury and shall follow-up/monitor
status.

10.4 Cancelled bonds be immediately by Finance tothe concerned


office.
11. Copy Distribution of Forms
11.1 Application Form (Form 58A) shall be accomplished in foour
(4) copies both for Central Office and Field Office:
1 - Directorate for Finance
2 - NFA-COA
3 - 4 Bureau of Treasury
11.2 Request for Bonding/Cancellation of Bonds (form 57A) shall
be accomplished in the following number of copies:
a. Central Office

1 - Directorate for Finance


2 - NFA-COA
3 - 6 Bureau/Office of the Bondable Officer/Employee

b. Regional Office

1 - Directorate for Finance


2 - NFa-COA
3 - 6 Bureau Auditor
7 - Regional Office-Admin. Section
8 - Regional Auditor
9 - Provincial Office-Admin. Unit
11.3 Field Offices shall retain and file their respective copies. Only
copies of Finance, NFA-COA and the Bureauof Treasury shall be
forwarded to Finance for indorsement to the Bureau of Treasury.
12. Request for Adjustment in the Amount of Bond/Change of
Incumbents
12.1 The exinting amount of bond of the bonded officer/employee
shall be concerned for adjusment in case there is substantial
increase/decrease in the total accountability.
Request for such adjustment shall bemade using
Form 57A - Request for Bond Application (no
supporting documents required) indicating the
updated amount of accountability and bond. The
remarks portion should clearly state
'Increase/decrease of accoountability from
__________ to _________. Hence, additional billing
by the Bureau of Treasury shall be based on the
increment.
12.2 In case of change of incumbents and there is simultaneous
bond application and cancellation for reasons already specified
(e.g. resignation and immediate appointment/designation for the
same accountable position) only one form (Form 57A) shall be
used for both request. The 'application' portion shall be for the
incoming accountable officer and the 'cancellation' portion for the
outgoing accountable officer. This shall require attachment of
Application (Form 58A) for the incoming accountable officer
including all other documents specified in 9.1.
The Remarks portion shall 'change of incumbent'
hence no additional billing by the Bureau of Treasury.
13. Financial Management
13.1 Basis in the payment of fidelity bond premiums shall be the
Treasury Bill-Form No. 32 (Exh. 3) supported by the Statement of
Account (Exh. 4) forwareded by the bureua of Treausry every
semester. Accounting entry shall be as follows;
DR: Finance Division-Fidelity Bond
Premiums Expense xxx
CR: Voucher Payable xxx

DR: Voucher Payable xxx


CR: Cash in Bank xxx
13.2 Finance/cash Division shall counter-check all the entries in
the statement of Account against its Master List of Bonded
accountable officers and employees as to the name off bonded
officer/employee, effectivity of the bond, aomunt of bond and
computation of bond premiums. Any discrepancy shall be
coordinated first with the Bureau of Treausry prior to payment of
Bond Premium Bill.

13.3 The Finance Director shall certify to the correctness of the


'Statement of Account' and the Corporate Auditor shall verify its
correctness. Corrected Statement of Account shall be the basis
for payment of total bond premiums.

13.4 Finance shall retain two (2) carbon copies of the 'Statement
of Account', one (1) copy to be furnished to NFA-CAO.
14. Reporting/Record Management
14.1 It shall be the responbility of the Administrative
Officer/Assistant to review regularly the listing of bonded
officials/employees in the branch and to determine
additions/deletions in the list and the upgrading/downgrading of
bonds based on records/SOs/instruction from management. Every
of the month, he shall wire Finance, Cash Division all bond
applications made by the province indicating name/designation of
employee and date documents fowrwarded to Regional Office.

14.2 Every end of the quarter, a Report on Bonded


Officers/Employees and Bonds Cancelled (Exh. 5) shall be
prepared by the AO/AA duly approved by the Provincial
Manager/Regional Director/Head Office and submitted to Finance,
Cash Division, copy furnished HRMD, Submission shall not be
later than the 3rd working day of the suceeding month.

14.3 Finance/Cash Division shall maintain index cards (Exh. 6)


which shall be prepared per individual accountable officer, to be
arranged per province and per region. Same shall be updated
based on incoming approved request for bond/cancellation.
At the end of the semester, Finance/Cash Division
shall prepare a Master List of Accountable officers to
be used for reconciliation against 'Statement of
Account' forwarded by the Bureau of Treasury.
15. Failure to File/Cancel Fidelity Bond
15.1 The Provincial Manager/Regional Director/Head of Office
shall be responsible in the filing of application/cancellation of
bonds. Appropriate administrative charges shall be filed against
them in case they fail to comply same.

15.2 Finance shall conduct reconciliation every endd of the


quarter on the approved fidelity bonds of all bondable
officers/employees per province as agianst their actual
assumption/termination of duty based on the quarterly reposrt
submitted by all the branches. any adverse findings shall be
communicated to the branch concerned and reported to the
Finance Director.
16. Claims Against Fidelity Bond
16.1 Claims against fidelity bond shall be filed only after all
possible means to recover the losses against the bondable
officers/employees have been exhausted.
16.2 Based on preliminary report/feedback, CAO shall notify in
advance the Bureau of Treasury regarding defaulting bonded
officers/employees even before the actual loss has been
established.

16.3 The concerned branch/office shall recommend immediately


to DEI investigation of the defaulting accountable
officer/employee. Legal proceedings shall be conducted by DLA
against the said officer/employee based on the findings of DEI.

16.4 Once the case brought to court has been decided, claim
against fidelity bond of the bonded officer/employee shall be filed
immediately. DLA shall prepare and submit its recommendation to
the Corporate Auditor for filing of claim against fidelity bond
supported by necessary documents, finding, examination and
court decision of the case. The Corporate Auditor shall
recommend approval of such claim to the Ministry of Finance thru
the Bureau of Treasury.

16.5 DLA shall monitor the status of claims with the Bureau of
Treasury and shall advise Finance regarding approval of same
III. RESPONSIBILITIES

1. Bondable NFA Officer/Employee


1.1 Accomplishes General Form 53(A) to apply for fidelity bond
and prepares supporting documents as required.

1.2 Secures General Form 57A (Request for bonding and/or


Cancellation of Bond) from immediatee supervisor.

1.3 Submits the accomplished forms to the respective


Administrative Officer/Assistant together with all the required
supporting documents.
2. Supervisor

2.1 Computes for the total amount of accountability and bond


recommended for the accountable officer.

2.2 Accomplishes Request for bond and/or Cancellation of Bond


(Form 57A).
3. Administrative Officer/Assistant

3.1 Identifies all officials/employees of the branch/office.

3.2 Determines the completeness of the application forms andthe


supporting docuents submitted by the applicant.

3.3 Secures 'First Indorsement' and 'Second Indorsemenrt' of the


bond request.

3.4 Forwards documents to Finance/cash Division for transmittal


to the Bureau of Treasury.

3.5 Prepares and sends monthly wire report and quarterly report
to Finance per required data.

4. Provincial/Regional Accountant PACNT-24 RACNT-07

Evaluates all bond applications forwarded by the Administrative


Officers/Assistant as to the correctness of accountabilities and
amount of bond.

5. Provincial Manager/C.O. Head Office PM-53

5.1 Recommends designation/appointment of accountable


personnel. Request for Special Order from the Regional Directo.

5.2 Signs Request for Bond and/or Cancellation of Bond


Accountable Officer/Employee.

5.3 Recommends to DEI investigation of defaulting bonded


employees under his jurisdiction.

5.4 Approves list of Bonded Accountable Officers/Employees


prepared by the AO/AA.

6. Regional Director RD-21

6.1 Issues Special Order for the designation of accountable


personnel.

6.2 Signs request for bond/cancellation of bond of Regional Office


accountable officers.
6.3 Signs under the 'First Indorsement' portion of Request for
Bond/Cancellation Bond from all provinces under his jurisdiction.

6.4 Recommends to DEI investigation of defaulting accountable


officers under his jurisdiction.

7. Finance-Cash Division

7.1 Secures First and Second Indorsement of Central Office bond


requests.

7.2 Reviews all bond request submitted by Central and Field


Offices prior to endorsement to Bureau of Treasury.Responsible
for monitoring and follow-up of same.

7.3 Informs concerned branch office aproved request for bond


cancellation.

7.4 Maintains index cards of bonded personnel nationwide at the


end of the semester, prepares Master List of bonded personnel
based on updated index cards.

7.5 Reviews 'Statement of Accounts' submitted by the Bureau of


Treasury and recinciles same with the Master List. Coordinates
any discrepancy with the Bureau of Treasury.

7.6 Prepares voucher for the payment of Fidelity Bond premiums


based on certified and verified correct 'Statement of Account'.

7.7 Files request for cancellation of bonds of officers/employees


based on wire request of field offices.

8. Finance Director

8.1 Signs on the 'First Indorsement' portion of Central Office


request for bond/cancellation of bond.

8.2 Certifies to the correctness of the 'Statement of Account'


submitted by the Bureau of Treasury.

9. HRMD Director
9.1 Signs Request for Cancellation of Bonds of field
officials/employees prepared by Finance, Cash Division.

10. D L A

10.1 Intiates legal proceeding against defaulting bonded


officials/employee based on recommendation of DEI.
10.2 Prepares and submits recommendation to the
Corporate Auditor for the filing of claims against Fidelity
Bonds, supported by required documents, findings,
examination including court decisions.
10.3 Monitors status of claims against fidelity bonds with the
Bureau of Treasury and advises Finance regarding approval
of same.

11. D E I
11.1 Upon receipt of recommendation from the Provincial
Manager/Regional Director/Head of Office, conducts
investigation of defaulting binded officer/employee.

11.2 Submits to DLA results of the investigation.

12. Branch COA Auditor


12.1 Evaluates and processes field offices request for
bond/cancellation including fixing the amount of bond of
every bondable officer/employee of the branch.
12.2 Affixes initials under the 'Second Indorsement' portion
of the bond request to signafy that same has been verified
and processed.

13. Regional Auditor

13.1 Evaluates and signs on the Second Indorsement potion of field


office bond request.

14. Corporate Auditor

14.1 Signs the 'Second Indorsement' portion of the C.O. request for
bond/cancellation.
14.2 Recommends approval of the NFA claims against
fidelity bonds of defaulting bonded officers/employees to the
Minister of Finance.
14.3 Verifies the correctness of the 'Statement of Account' in joint
undertaking with the Finance Director.

IV. FLOW CHART


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EXHIBITS
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SOP Library
SOP NO: HR-PB27 (List of Exhibits/Attachments)

Mission: Finance and Administration

Area: Human Resource (HR)

Activity: Personnel Benefits and Services (HR-PB)

Title: Revised SOP on Leave of Absence

Date Approved/Issued: 11/07/1996

Date Effective: 11/07/1996

Digest:

I. TERMS OF REFERENCE
A. Rationale
B. Objective
C. Scope
D. Basis

II. IMPLEMENTING GUIDELINES


A. Coverage
This shall cover all NFA officers and employees whetherregular or
casual except those employed on a contractual, part-time or
emergency basis.
B. Entitlement
1. Sick Leave/Vacation Leave
a) All officers and employees whether permanent or
temporary who have rendered six (6) months of continuous,
faithful and satisfactory service shall be entitled to a seven
and a half (7.5) days sick leave and seven and a half (7.5)
days vacation leave with full pay, exclusive of Saturdays,
Sundays and Public Holidays. After rendering six (6)
months of continuous, faithful and satisfactory service, an
employee shall earn 1.25 days vacation leave credits and
1.25 days sick leave credits every month.

b) Employees appointed on a casual or emergency status


shall likewise be entitled to vacation and sick leave after
having rendered a total of at least six (6) months continuous
service in the aggregate, provided such six (6) month period
does not involve a single break of more than one (1) week
and/or several breaks of from one (1) to three (3) days, the
total of which should not exceed fifteen (15) days.

c) Employees rendering services on a part-time basis shall


not be entitled tovacation and sick leave benefits. However,
if an employee works part time in two (2) or more different
offices and renders the required office hours, he shall be
entitled to leave benefits.

d) Employees hired on a contractual basis are not entitled to


vacation and sick leave benefits. Employment contract shall
not provide for such leave benefits.

e) Vacation and sick leave shall be cumulative and any part


thereof which may not be taken within the calendar year in
which earned, may be carried over the succeeding years.
An officer or employee who retires or voluntarily resigns or
is separated from the service through no fault of his own on
or after January 9, 1986 and whose benefits are not
covered by any special law, shall be allowed to commute all
the accumulated vacation and/or sick leave in excess of 300
days, exclusive of Saturdays, Sundays and Holidays without
limitation as to the number of days accumulated.

f) Vacation and/or Sick leave requested by any officer or


employee during the first six (6) months of service from the
date of original appointment (Probationary Period) shall be
without pay. Any absence during the first six (6) months of
service shall extend the completion of the probationary
period for the same number of days that an officer or
employee was absent.
2. Maternity Leave
a) A married woman employee who has rendered an
aggregate of two (2) or more years of service under
permanent, casual, temporary or contractual status, shall be
entitled to sixty (60) days maternity leave with full pay in
every instance of pregnancy irrespective of its frequency in
relation to period.
b) Effective February 14, 1992, married women employees
who have rendered less than two (2) years of government
service regardless of status of appointment can avail of the
maternity leave but the computation of their maternity leave
pay shall be proportionate to their length of service.

c) An employee who is on maternity leave with full pay and


who wants to report back for duty before the expiration of
her maternity leave, may be allowed provided she presents
a medical certificate that she is physically fit to assume the
duties of her position. However, she need not refund the
computed money value of the unexpired portion of her
maternity leave. She may receive the benefits granted
under the maternity leave law and the salary for actual
services rendered effective the day she reports for work
prior to the expiration of the sixty (60) days period. Since
the employee will be paid only for actual services rendered,
she need not file an ALA for days that she did not report for
work.
3. Paternity Leave
a) Every married male employee who holds a regular
position item in any government office or entity as well as
casuals and contractuals with existing appointments who
have a direct employer - employee relationship with a
particular government office/entity, shall be entitled to
paternity leave benefits of seven (7) days with full pay for
the first four (4) deliveries of the legitimate spouse with
whom he is cohabiting.

The term "cohabiting" refers to the obligation of the husband


and wife to live together. However, one spouse may be
exempted from living with the other if the latter should live
abroad or there are valid reasons for the exemption,
Provided: such exemption shall not apply if the same is not
compatible with the solidarity of the family.

b) A married male employee shall be entitled to paternity


leave by filing the requisite leave application form one (1)
week prior to the expected delivery or immediately after the
delivery date except in cases of miscarriage and abnormal
deliveries which were unforseen. Approval of the leave
application shall be mandatory on the part of the approving
authority unless the services of the male employees are
urgently needed to preserve life and property in which case
the male employee shall be entitled to overtime pay.

c) The paternity benefits set forth therein, may be enjoyed


by the qualified male employee on the days immediately
before, during and after the childbirth, or miscarriage of his
legitimate spouse. It shall be non-cumulative and strictly
non-convertible to cash.
4. Special Privilege
a) An employee may be granted a maximum of three (3)
days within a calendar year to avail of any of the special
privileges of his/her choice:

Funeral/mourning leave
Graduation leave
Enrollment leave
Wedding/Anniversary leave
Birthday leave
Hospitalization leave
Accident leave
Relocation leave

b) It shall be non-cumulative and non-commutable.

c) It shall be enjoyed only by those who have rendered six


(6) months of continuous, satisfactory service. Casual or
emergency employees or laborers may enjoy these
privileges after they have rendered at least six months'
service in the aggregate.

d) An employee shall seek approval of the application for at


least one (1) week prior to the availment, except on
emergency cases.
5. Leave With Pay

Vacation leave of absence with pay shall be allowed provided the


employee has no pending formal administrative charge.

6. Leave Without Pay


a) Unauthorized leave of absence shall be considered as
leave without pay.

b) For intermittent or broken absences, the leave of


absence without pay shall be exclusive of Saturdays,
Sundays or Holidays. However, an employee's leave of
absence without pay shall be inclusive of Saturdays,
Sundays and Holidays for continuous absences covering 5
working days or more.

Illustration:
Employee A has no more leave credits and he was
absent on Friday and the succeeding Monday. He
shall be considered on leave without pay for two (2)
days only (Friday and Monday).
Employee B is on continuous leave of absence
without pay for seven (7) days covering 2 week-ends
(first day of absence is Friday and the 7th day is
Monday of the following week). The basis for the
computation of leave without pay shall be the number
of calendar days. He shall be considered on leave
without pay for eleven (11) days.

c) Vacation leave of absence without pay may be allowed


for a period of three (3) months. All applications for
extension should be accompanied by written request citing
the reason for such leave.

d) Leave without pay shall not be granted whenever an


employee has leave with pay to his credit except in the case
of secondment.

e) Application for leave of absence where the purpose or


reason for such leave is for employment in private or other
government offices, either inside or outside the country will
no longer be allowed (CSC MC No. 15, s. 1989).

The head of the department/office shall be held


administratively liable for approving applications for leave of
absence of employees who are employed in private or other
government offices.
f) Employee who is on official vacation leave of absence
with or without pay maybe recalled by the Head of
Office/Agency in the exigency of the service. He shall be
notified in writing the reasons for his recall. Failure on his
part to report for work within the period stated in the order
shall be a valid ground to drop him from the rolls.
C. Granting of Vacation Leave/Sick Leave
1. Sick leave shall be granted only on account of sickness or
disability on the part of the employee concerned or of any
member of his immediate family.

2. Sick leave may be applied for in advance in cases where the


official or employee will undergo medical examination or surgery
or advised to rest in view of ill health duly supported by a medical
certificate.

3. Applications of officials and employees for leave of absence on


account of illness, wounds or injuries incurred in the performance
of duty extending beyond the available leave credits of the
employee concerned must be made on the prescribed form,
supported by the proper medical certificate and evidence showing
that the illness, wounds or injuries were incurred in the
performance of duty. The Head of Department/Agency concerned
may direct that absence during any period of disability thus
occasioned shall be on full pay, but not to exceed six (6) months.
He may, in his discretion, also authorize the payment of medical
attendance, necessary transportation, subsistence and hospital
fees of the injured persons.

4. Leave of absence for any reason other than illness of an officer


or employee or of any member of his immediate family must be
contingent upon the needs of the service. Hence, the grant of
vacation leave shall be at the discretion of the head of
Department/Agency.

5. Vacation leave with pay or sick leave with or without pay are
part of the actual service of an employee and he/she earns leave
credits when on such leave. Vacation leave without pay, however,
is not considered as part of the actual service and an employee
who is on vacation leave without pay does not earn leave credits.
D. Filing of Application for Leave of Absence
1. All absences for one (1) full day or more shall be properly
covered by an Application for Leave of Absence (see Exhibit). An
employee need not accomplish an application for leave of
absence incurred for one-half day.

2. Filing of application for sick leave shall be filed immediately


upon the return of the employee from his leave. An employee is
however required during the period of his illness to notify his
supervisor in whatever fastest means of his inability to report for
work, due to illness. Failure to comply with the said requirement
shall be considered as Violation of Reasonable Office Rules and
Regulations, which under Executive Order 292 (otherwise known
as the Administrative Code of 1987) is treated as light offense
with the corresponding degrees of penalties:

1st offense - reprimand


2nd offense - suspension 1-30 days
3rd offense - dismissal

3. Newly hired employees who have not yet earned leave with pay
to their credit shall likewise file an application for leave of
absence.

4. Application for vacation leave of absence for ten (10) days or


more shall be submitted five (5) days in advance, of the effective
date of such leave.

The employee should see to it that the leave application is


approved by the proper authorities. Thus mere filing of such leave
application does not entitle the officer/employee to go on leave
outright.

5. Filing of sick leave of absence exceeding five (5) days shall be


accompanied by a medical certificate to certify the employee's
illness or that of any member of his immediate family.

In ordinary application for sick leave already taken not exceeding


five (5) days, the head of department or agency concerned may
duly determine whether or not granting of sick leave is proper
under the circumstances. In case of doubt, a medical certificate
may be required (Sec. 18, Rule XVI on Leave of Absence).
6. All applications for leave of government officials/employees, the
duration of which is intended to be spent abroad, shall be
submitted to the Head of the Agency for final action/approval.

7. Applications for commutation of vacation/or sick leave in


connection with separation through no fault of an officer or
employee should be sent to the head of department or agency
concerned for approval.

8. An employee who fails to report for work on a regular day for


which a holiday is declared whether whole or half day, shall be
considered absent on that day, and therefore should file an
application for leave of absence.

9. Any violation of the leave laws, rules or regulations, or any


misrepresentation or deception in connection with an application
for leave, shall be a ground for disciplinary action.
E. Transfer of Leave Credits
When an officer or employee transfers from one government
agency to another, he can choose either of the following modes
relative to his unused vacation and/or sick leave provided there is
no gap in the service, to wit:

Have it commuted; or
Have it transferred to his new agency

F. Computation
1. Computation of vacation and sick leave credits shall be made
on the basis of 1.25 days vacation leave and 1.25 days sick leave
for every month of actual service.

"Actual Service" refers to the period of continuous service to


include Saturdays, Sundays and Holidays since the appointment
of the officer or employee concerned, including the period covered
by any previous vacation leave with pay and sick leave with or
without pay.

2. Leave without pay deductible from an employee's salary shall


be computed based on the total number of calendar days for the
specific month for which leave of absence without pay was
incurred.
3. Approved sick leave application can be charged to vacation
leave if ever the employee has no more sick leave credits.
However, in case an employee has no more vacation leave, his
approved vacation leave applications shall be without pay and
cannot be charged to sick leave.

4. The number of minutes incurred as tardiness/undertimes shall


be converted into a fraction of a day using the following formula:
number of minutes late/undertime
-------------------------------------------
480 minutes

For case of conversion, a table has been prepared (see Exhibit).

5. For purposes of granting leave of absence with pay, a leave


balance which is a fraction of 1/4 (.25) or more but less than 3/4
(.75) shall be considered as one-half (1/2) day and a fraction of
three-fourths (3/4) or more shall be counted as one full day.
Example I. An employee incurred a half-day leave of
absence and the vacation leave balance to his credit is only
.250, the employee is still considered leave with pay
because .250 is still 1/4 of a day.

.250 balance
- .500 undertime
---------------------
- .250 balance
if he incurred 3 hours undertime
.250 balance
- .375 undertime
---------------------
- .125 balance
Example II. When an employee has a balance leave credit
of .750 or more but less than one (1) day and he incurred a
one (1) day absence, this can be considered as 1 full day to
offset such absence.

.75 balance
-1.00 absence
-------------------
- .25 balance
The negative balance in the three examples which should not
exceed to not more than .250 are carried over to the next month
which in turn can be deducted from the earned leave credits.
G. Processing
1. For Central Office rank and file employees, applications for
leave of absence with or without pay for maternity leave and leave
of less than 30 days shall be processed at their respective
departments. Applications for thirty (30) days or more shall be
processed by Personnel Benefits Unit (PBU)-HRMD.

2. For Provincial Office rank and file employees, application for


leave of absence with or without pay shall be processed at the
Provincial Office. Likewise, for Regional Office rank and file
employees, application for leave of absence with or without pay
shall be processed at the Regional Office. Application for ninety
(90) days or more shall be processed by PBU-HRMD.

3. Applications for leave of absence with or without pay of all


Executive Assistant I in the Central Office and all Administrative
Officers in the Regional Office shall be processed at PBU-HRMD.
Likewise, application for leave of absence of all Administrative
Officers of Provincial Offices shall be processed at the Regional
Office.

4. Terminal leave for field office rank and file employees shall be
processed and shall be recommended for approval at the
respective Regional office. For Central office rank and file, it shall
be processed by PBU-HRMD. Leave cards should be properly
closed and certified correct by the respective Executive Assistants
and noted by the respective department heads/office. All entries
shall be reviewed by PBU-HRMD.

5. Application for leave of absence and terminal leave of Central


and Field office executives shall be processed by PBU-HRMD.

6. Medical certificate for sick leave exceeding five (5) days shall
be issued by the NFA Clinic Physicians only if prior consultation
was made with them before going on leave of absence. For
employees who were referred by our doctors to appropriate
medical specialists, the attending specialist or physician shall
issue the necessary Medical Certificate covering his leave of
absence.

7. In case of doubt, the head of office/department shall request


the Health Services Unit (HSU) to conduct a spot check on the
employees to verify their health condition regardless of the
number of days of leave.

8. Processing of ALA shall have the following attachments:


a) ALA being processed within the department/office
concerned:

For vacation leave of absence of more


than 30 days:

- Clearance from property and financial


accountability

For sick leave of absence exceeding 5


days:

- Medical certificate

For sick leave of absence of more than 30


days

- Medical certificate
- Clearance from property and financial
accountability

For sick leave of absence filed in advance

- Medical certificate

Whenever the head of office doubts the


employee's claim of ill-health, regardless
of number of days of sick leave

- Medical certificate

For maternity leave


- Marriage contract, leave card for rank
and file
- Clearance from property and financial
accountability
- Medical Certificate

For paternity leave

- Certified true copy of the marriage


contract
- Birth certificate of the newly-born child
- Medical certificate with pathology
reports in case of miscarriage, duly
signed by the attending physician or
midwife showing the actual date of the
childbirth, miscarriage.
b) ALA being processed at HRMD:

For vacation leave/sick leave of thirty (30)


days or more

- Letter stating reason for the application


for leave of absence
- Clearance from property and financial
accountability
- Original copy of leave card
- Medical certificate
H. Specification of Authority (Application of Leave of Absence)

Processing Recommending Approval


Office Approval
1. Central Office

a) Deputy Administrator PBU-HRMD Administrator


regardless of the
number of days with
or without pay
b) Assistant Administrator PBU-HRMD Concerned De-
Administrator
regardless of the puty Administrator
number of days, with
or without pay
c) Department Manager
Maternity leave PBU-HRMD Concerned Assis-
Concerned Deputy
tant Administrator Administrator*
Assistant Adminis- Deputy Administrator
trator for Finance for Finance and Ad-
and Administration ministration (For Staff Offices)
Leave of less PBU-HRMD Concerned Assis-
Concerned Deputy
than 30 days tant Administrator Administrator*
Assistant Adminis- Deputy Administrator
trator for Finance for Finance and Ad-
and Administration ministration (For (For Staff Offices)
Staff Offices)

30 days or more but PBU-HRMD Concerned Deputy


Administrator
less than 90 days Administrator*
Deputy Administra-
tor for Finance and
Administration (For
Staff Offices)
d) Assistant Department
Managers
Division Chief or
equivalent rank,
with or without pay

Maternity leave PBU-HRMD Department Concerned Assistant


Manager Administrator Assistant Administra-
tot for Finance and Administration (For
Staff Offices)
Leave of less PBU-HRMD Department Concerned
Assistant
than 30 days Manager Administrator Assistant
Administra-
tor for Finance and Administration (For
Staff Offices)

30 days or more but PBU-HRMD Department Concerned Deputy


less than 90 days Manager/Con- Administrator cerned Assistant Deputy
Administrator
Administrator for Finance and Ad-
Assistant Adminis- ministration (For trator for Finance Staff Offices)
and Administration
(For Staff Offices)
e) Line department rank
and file employees
Maternity leave Respective Division Chief/
Department Mana- Department Assistant ger*
Department
Manager

Leave of less than Respective Division Chief/


Department Manager*
30 days Department Assistant
Department
Manager

30 days or more but PBU-HRMD Department


Concerned Assistant
less than 90 days Manager Administrator
Assistant Administra-
tor for Finance and
Administration (For Staff Offices)
f) Administrative Assistant PBU-HRMD Department
Department Manager Manager of Human Resource
Management Depart-
ment
g) Employees at the Office of Head of Staff Concerned
Assistant Office Assistant Assistant of Administrator/Deputy
Administrator/De- Administra- Administrator
puty Administrator tor/Deputy
Administra-
tor
h) Employees at the Administra- Special Assistant Deputy
Administrator Administrators Office tors Office for Finance
and
Adminstration
2. Field Office
a) Regional Managers
Maternity leave PBU-HRMD Assistant Adminis-
Deputy Administrator trator for Finance for Finance
and and Administration Administration
Leave of less than PBU-HRMD Assistant Adminis-
Deputy Administrator
30 days, with or trator for Finance for Finance and Ad-
without pay and Administra- ministration
tion
30 days or more PBU-HRMD Deputy Adminis-
Administrator
but less than 90 trator
days, with or
without pay

b) Assistant Regional
Manager,
Manager,
Provincial Managers
Assistant Provincial
Manager,
Head of Grains
Complex Center
Maternity leave PBU-HRMD Regional Deputy
Administrator
Manager for Finance and Ad-
ministration
Leave of less PBU-HRMD Regional Deputy
Administrator than 30 days Manager for Finance and
Ad-
ministration
30 days or more but PBU-HRMD Deputy Adminis- Administrator *
less than 90 days trator for Finance
and Administration

c) Rank and file


employees

Maternity leave P.O./R.O Assistant Provincial Provincial Manager/


Manager (P.O.) OIC (P.O)*
Unit Head (R.O.) Assistant Regional
Manager (R.O.)
Leave of less P.O/R.O Assistant Provincial Provincial
Manager/
than 30 days Manager (P.O.) OIC (P.O)* Unit Head
(R.O.) Assistant Regional Manager (R.O.)
30 days or more but P.O/R.O Provincial Manager/
Regional Manager
less than 90 days OIC (P.O)* Assistant Regional
Manager (R.O.)
d) Provincial R.O. Provincial Manager Regional Manager
Administrative
Officer
e) Regional R.O. Assistant Regional Regional Manager
Administrative Manager
Officer

All ALAs for terminal leave and ALAs for 90 days or more, of
employees regardless of position, shall be subject to the approval
of the Administrator.
* Official next lower-in-rank can execute the required action in the
absence of the authorized official.

NOTE: Any of the Assistant Administrators or Deputy


Administrators can act in behalf of the other in case of the
absence of one.
I. Commutation of Leave
1. The head of Agency may, in his discretion, authorize the
commutation of the salary that would be received during the
period of vacation and sick leave of any appointive officer and
employee and direct its payment on or before the beginning of
such leave.

2. When an employee whose leave has been commuted following


his separation from the service is reappointed in the government
before the expiration of the leave commuted,the employee is
given two (2) options, as follows:
a) Refund the money value of the unexpired portion of the
leave commuted; or

b) May not refund the money value of the unexpired portion


of the leave commuted, but insofar as his leave credits is
concerned, he shall start from zero balance.
J. Forced Leave
1. Officials and employees shall be required to go on vacation
leave for a minimum of five (5) working days annually which need
not be successive.

2. The Head of Office shall prepare a staggered schedule of the


mandatory annual five (5) - day vacation leave of officials and
employees, provided that he may, in the exigency of the service,
cancel any previous scheduled leave.

3. The mandatory annual five (5) day vacation leave shall be


forfeited if not taken during the year. However, in cases where the
scheduled leave has been cancelled in the exigency of the service
by the head of office, the scheduled leave not enjoyed shall no
longer be deducted from the total accumulated vacation leave.
K. Monetization of Leave Credits

1. An official or employee who has accumulated at least fifteen


(15) days vacation leave credits shall be allowed to monetize a
maximum of ten (10) days vacation leave.

2. The monetization of vacation leave credits shall be availed of


only once a year. The availment can be any month of the year.

3. If an official or employee does not avail of the privilege of


monetizing his vacation leave credits in a year, it shall be deemed
included in his accumulated leave credits.

4. An official or employee who monetized the maximum ten (10)


days vacation leave shall still go on the five (5) days forced leave
as provided for under EO 1077 dated January 9, 1986.

5. The employee who avails of this privilege shall not be allowed


to go on vacation leave simultaneous with the monetization of
leave credits. This provision, however shall not be applied to
those who shall go on sick leave.

6. To facilitate monitoring of compliance to 11.5, an official or


employee who avails of the privilege of monetizing his vacation
leave shall file an application for leave of absence indicating
therein the number of days he intends to commute and the
duration of such leave.
7. The number of days of vacation leave that the employee
monetized shall be deducted from his leave credits.

8. The computation of the money value shall be based on twenty


two (22) working days. For a casual employee, computation shall
be based on daily rate.
L. Payment
1. An official or employee who is on vacation or sick leave shall be
granted leave with pay at the salary he is currently receiving.

2. An official who is on leave of absence without pay, for a


cumulative number of more than 15 calendar days in a given
month shall not be allowed to collect his representation and
transportation (RATA) allowance on that month, except if the
leave of absence is due to illness in which case a medical
certificate from the attending physician shall be submitted.
M. Absence Without Official Leave (AWOL)

1. An employee shall be considered AWOL (absent without official


leave) if he is not reporting for work without an approved leave.

2. An officer or employee who is continuously absent for at least


thirty (30) days without approved leave is considered on absence
without leave (AWOL) and shall be dropped from the service
without prior notice. He shall, however, be informed of his
separation from the service not later than five (5) days from its
effectivity which shall be sent to the address appearing on his 201
files. The Notice of Separation shall be signed by the appointing
authority.

If the number of unauthorized absences incurred is less than thirty


(30) calendar days, a written return to work order shall be sent by
the person exercising immediate supervision on the official or
employee at anytime that the service of the employee may be
required in the interest of the service, at his last known address
on record.

Failure on his part to report for work within the period stated in the
order shall be a valid ground to drop him from the rolls. This
action, however, is appealable to the CSC or its Regional Office
within fifteen (15) days from receipt of such order. (CSC M.C. No.
12, s. 1994).

3. An employee granted vacation leave without pay who fails to


return for any reason at the expiration of his leave, after having
been notified once and warned of the consequence by the head of
office/agency, shall be considered AWOL, hence shall be
automatically dropped from the service.
N. Forfeiture of Leave Benefit and Rice Allowance

1. The leave benefit of any officer or employee who is separated


from the service for a cause shall be forfeited. However, if the
penalty meted on him is forced resignation, said employee maybe
entitled to his terminal leave benefits if the decision on the
administrative case expressly states his entitlement to the same.

2. An employee who is on official leave of absence without pay for


a continuous period of one (1) month , except those on maternity
leave (with full or half pay) shall not be entitled to rice allowance.
In line with this, the practice of reporting for work for one (1) day
to break the continuity of a prolonged leave of absence with the
intention of circumventing the foregoing policy of granting rice
allowance shall not be allowed. He/she should report for work at
least seven (7) working days in a month to be entitled to a rice
allowance.
O. Tardiness/Undertime/Absences

1. The Executive Assistant/Administrative Officer shall be


responsible for monitoring the tardiness/undertime of rank and file
employees.

2. Tardiness and undertime are deducted from vacation leave


credits and shall not be charged against sick leave credits.

3. Officers and employees who have incurred tardiness and


undertime regardless of the number of minutes, ten (10) times a
month for at least two (2) months in a semester or at least two (2)
consecutive months during the year shall be subject to disciplinary
action pursuant to CSC M.C. 4 & 21 s. 1991. Per MC No. 4 and
21 s. 1991, tardiness is treated separately from undertime. Thus
an employee can incur a maximum of nine times (9x) tardiness
and nine times (9x) undertime in a given month.
4. An officer or employee shall be considered habitually absent if
he incurs unauthorized absences exceeding the allowable 2.5
days monthly leave credit under the leave law for at least three (3)
months in a semester or at least three (3) consecutive months
during the year.
Sanctions for habitual tardiness and absentism are the
following:
a) First violation, the employee after due proceedings shall
be meted the penalties of six (6) months and one (1) day to
one (1) year suspension without pay.

b) Second violation, the employee after due proceedings,


shall be dismissed from the service.
5. Half-day absences, though deducted from vacation leave
earnings, shall not be considered as undertime or tardiness.

6. Off-setting of tardiness or absences by working for an


equivalent number of minutes or hours by which an officer or
employee has been tardy or absent, beyond the regular or
approved working hours of the employee concerned, shall not be
allowed.
7. Computation of undertime shall be based on the actual number
of hours and minutes of undertime incurred by an employee.
Hence, tardiness of more than two (2) hours but less than four (4)
hours in the morning or in the afternoon which was then
considered as 4 hours undertime or half-day leave of absence
shall now be deducted from the vacation leave credits only for the
actual number of hours and minutes incurred as undertime.
P. Maintenance of Perpetual Leave Cards

1. Maintenance of perpetual leave cards shall be decentralized at


the respective offices/departments while those of the
Executives/Executive Assistants (C.O.) and Administrative Officer
(R.O) shall be at PBU-HRMD. Leave cards of Provincial
Administrative Officers shall be maintained at their respective
regional offices. For ALAs to be approved by HRMD, a xerox copy
of the employee's leave card shall be attached as supporting
document.

2. In case a rank and file employee is reassigned or transferred


from Central Office to the Field Office or vice-versa, the
originating office shall transmit the original leave cards of the
transferred/reassigned employee to his/her new work station and
maintain only a duplicate or xerox copy of the same for its
reference.

3. The authorized processor shall reflect on the leave cards all


leave of absence with or without pay, incurred by the employee
and leave credits earned at the end of the month. The processor
shall affix his initial for every entry made on the leave card.
Q. Reporting of Absence

1. The Executive Assistant/Administrative Officers of the central


office Departments and the field offices shall submit a monthly
and quarterly Personnel Attendance and Leave Balances Report
(see Exhibit) to HRMD and to respective regional office based on
the accomplished time card. The time cards shall be submitted to
DAB/Accounting unit only after the monthly and quarterly
Personnel Attendance and Leave Balances Report have been
prepared by the Executive Assistants/Administrative Officers.

2. The respective heads of office shall be responsible for


monitoring and ensuring that rules, policies and procedures on
leave of absence are strictly implemented and complied with
especially those applicable to prolonged and unauthorized
absences.
R. Audit of Leave Credits

A monthly spot checking of leave cards, maintained by the


Executive Assistant I and the Administrative Officer in the field
office , shall be conducted by HRMD every now and then to check
the veracity of the entries by the processor. IAS shall then
conduct an annual audit of all leave cards of Central and Field
Office employees.
III. RESPONSIBILITIES
A. Application/Processing/Approval of the leave of absence of NFA
officials - Central and Field Office (Division Chief/Equivalent rank
and up) and Executive Assistant I (C.O.) and Regional
Administrative Officer.
1. NFA Officials/Executive Assistant I/Regional Administrative
Officer
a) Accomplishes and signs application for leave of absence
in three (3) copies
2. Personnel Benefits Unit (PBU), HRMD
a) Updates the perpetual leave card of the concerned NFA
Official/Executive Assistant I/Regional Administrative Officer
and reflects the leave balance in application of leave of
absence (ALA) before approval.
b) Forwards ALA of concerned NFA official/Executive
Assistant I/Regional Administrative Officer to the approving
authority.
3. Recommending Authority
a) Signs in the recommending approval portion of the said
documents
4. Approving Authority
a) Approves/disapproves ALA
5. Executive Assistant/Administrative Officer
a) Forwards copy # 1 of approved ALA to DAS together with
the daily time record every end of the month.

b) Retains copy # 2 of the approved ALA for file and


reference.
B. Application/Processing/Approval of Application of Leave of
Absence (ALA) of Provincial Administrative Officer
1. Provincial Administrative Officer
a) Accomplishes and signs ALA in three copies.
2. Regional Administrative Officer
a) Updates the perpetual leave card and reflects the leave
balance in ALA before approval.

b) Forwards ALA to the approving authority.


3. Recommending Authority
a) Signs in the recommending approval portion of the said
documents.
4. Approving Authority
a) Approves/disapproves ALA.
5. Regional Administrative Officer
a) Forwards copy #1 of approved ALA to the Provincial
Accounting Unit together with the daily time record every
end of the month.

b) Retains copy # 2 of the approved ALA for file and


reference.
C. Application/Processing/Approval of leave of absence (ALA) of
rank and file employees (Central and Field Office)
1. Employee (Central and Field Office)
a) Accomplishes and signs ALA in three (3) copies.
2. Executive Assistant I (for Central Office rank and file
employees)/Provincial Administrative Officer (for Provincial Office
rank and file employees)/Regional Administrative Officer/(for
Regional Office rank and file employees)
a) Updates the perpetual leave card of the concerned
employee and reflects the leave balance in the ALA before
approval.
b) Notes the tardiness and undertime and deducts from the
vacation leave of concerned employee every end of the
month.
c) Forwards copy # 1 of approved application of eave of
absence (ALA) together with the time cards and the payroll
to DAS (C.O.)/Accounting unit (P.O. and R.O.).

d) Retains copy # 2 of the approved ALA for file and


reference.

e) Prepares the periodic attendance report to be submitted


to PBU-HRMD/R.O.
3. Department of Accounting Services (DAS) - (C.O)/Accounting
Section (P.O./R.O.)
a) Processes the payroll.

b) Deducts leave without pay from the salary of employees.

c) Forwards copy # 2 of approved ALA together with the


time cards and payroll to COA for post-auditing.
IV. FLOW CHART
Top Page
EXHIBITS
Table Showing Conversion of Working Hours/Minute Into Fractions of a Day
Application for Leave of Absence
Personnel Attendance and Leave Balances Report
SOP Library
SOP NO: 05012 (List of Exhibits/Attachments)

Mission: Finance and Administration

Area: General Services (GS)

Activity: Communication Reproduction Services (GS-CR)

Title: Records Retention and Disposition

Date Approved/Issued: 07/30/1983

Date Effective: 08/04/1983

Digest:

I. TERMS OF REFERENCE
A. Rationale
B. Objective
C. Scope
D. Basis

II. IMPLEMENTING GUIDELINES

A. GENERAL POLICIES
A.1 Records inventory and appraisal shall be conducted every
first month of the year by all provincial /regional/central offices,
following the approved NFA records retention and disposition
scheme - RRDS (Annex A)

A.2 It shall be the responsibility of the Head of Office/directorate


to see to it that the herein stated provisions are implemented.

A.3 Computation as to volume of inventoried records shall be


expressed in cubic meters/centimeters following the attached
Bureau of Records Management Standard Procedures (Annex B).

A.4 Each Provincial/Regional Office shall provide for its respective


records center where inactive and non-current records maybe
stored.
A.5 The Storekeeper/Property Custodian shall safekeep, be in-
charge and accountable for the records inside the Records
Center.

A.6 In the Central Office, the Records Center located at ground


floor, Matimyas Annex Building, shall be the site of all records
disposal/storage of all directorates. In the case of field offices,
actual disposal of records shall be conducted at the Regional
Records Center found accessible to all the Provincial Offices
within the region. As such the Regional Office shall communicate
with the Records Management Section (RMS), General Services
Directorate (GSD) for the proposed site of the Regional Records
Center.

A.7 Request for authority to dispose of records shall be forwarded


to the Records Management Section, GSD not later that the first
day of February each year.
III. DETAILED PROCEDURES

Responsibility Action

1. Records Appraisal and Inventory


Administrative Officer/ Adm. Asst. 1. Coordinates with
Division/Section/Unit
Chiefs and jointly conducts inventory
of all
records.
2. Using NFA's RRDS, sorts records
series
as to appropriate action to be taken.
2.1 For maintenance-records which
still
form part of the current files.
2.2 For storage - records which
include
inactive and non-current files which
need to be transferred to designated
records center
2.3 For disposal - records/files which
have
outlived their retention period.

Responsibility Action
2. Request for transfer to the Records Center for storage

Admin. Officer/Admin. Asst. 1. Accomplishes request for transfer of


records to Records Center (Exhibit A.1)
and records Transfer List (Exhibit A.2) in
a quadruplicate each.
2. Forwards to Division/Section/Unit
Chief.
Division/Section/Unit Chief 3. Reviews/checks forms. If okay, affixes
initials on "Head of Office/Directorate"
portion of Exhibit A.1.
Head of Office/Directorate 4. Signs form
5. Forwards to Regional Director/GSD
Director.
Regional Director/GSD Director 6. Approves/disapproves request.
7. Retains copy 2 of Exhibit A.1 and
copy 4
of Exhibit A.2.
8. Forwards copy 1 of Exhibit A.1 and
copies
1 - 3 of Exhibit A.2)
Office/Directorate 9. Upon receipt of duly approved
request,
effects transfer of records to the
designated
Records Center.
Central Office: coordinates with Records
Management Section
Field Office: Administrative Officer/
Administrative Asst. effect the transfer.
Admin. Officer/Admin. Asst./ 10. Receives/processes records.
designated Records Custodian
3. Request for transfer of records to the Records Center for
disposal
Admin. Officer/Admin. Asst. 1. Accomplishes Exhibits A.1 and A.2 in
quadruplicate. Indicates on the transfer
list records awaiting immediate disposal
by putting an asterisk (*) before the item
number.
2. Accomplishes Exhibit B - request for
Authority to Dispose of Records
(See 3.A below)
3. Simultaneously send out both forms
following procedures 2 to 10 and 3A.1 to
3A.12
3A. Request for Authority to Dispose of Records
(Ehxibit B)

Admin. Officer/ Admin. Asst. 1. Prepares request in four (4


Copy 1 - Requesting Office
2 - Bureau of Records
3 - Management (B.R.M.)
4 - Records Management Sec
2. Signs "Prepared by" portion
form.
3. Forwards to Provincial Man
for
signature
Head of Office/ Directorate 4. Affixes signature on portion
for
"Signature of Official".
5. Forwards 4 copies of Requ
Records
Management Section GSD.
Records Management Section 6. Reviews request; forwards
BRM.
7. Upon receipt of duly approv
from
BRM; forwards the same to th
Directorate concerned.
Office/Directorate 8. Schedules date and mode
9. Informs Records Managem
Section, GSD
Records Management Section, 10. Coordinates with BRM Sc
GSD Disposal.
11. Prepares Certificate of Dis
Records
(Exhibit C)
12. Effects disposal in the pre
BRM,
COA and Records Manageme
representative.
III. RESPONSIBILITIES

IV. FLOW CHART


Top Page
EXHIBITS
No Exhibit/s Available for this SOP
SOP Library
SOP NO: GS-CR08 (List of Exhibits/Attachments)

Mission: Finance and Administration

Area: General Services (GS)


Activity: Communication Reproduction Services (GS-CR)

Title: Revised SOP on Records Retention and Disposition

Date Approved/Issued: 04/27/2016

Date Effective: 04/27/2016

Digest:

I. TERMS OF REFERENCE
A. Rationale
B. Objective
C. Scope
D. Basis

II. IMPLEMENTING GUIDELINES

E. DEFINITION OF TERMS
1. Archival Records - shall refer to public records, papers,
periodicals, books or other items, articles or materials whether in
the form of electronic, audio-visual or print, which by their nature
and characteristics have enduring value, that have been selected
for permanent preservation.
2. General Records Disposition Schedule (GRDS) the listing
of records common to all government agencies that serves as
reference for identifying retention period prior to disposal of
valueless records.
3. Records - refers to information, whether in its original form or
otherwise, including documents, signatures, seals, texts, images,
sounds, speeches, or data compiled, recorded, or stored as the
case may be :
In written form or any material;
On film, negative, tape or other medium so as to be capable
of being reproduced; and
By means of any recording device or process, computer or
other electronic device or process.
4. Records Custodian refers to any agency employee with
responsibilities over a particular set of records. A Records
Custodian must keep the Records Officer informed of any issues
regarding the records in their custody.
5. Records Disposal - the act of removing valueless records from
existing files or storage areas and getting rid of them by selling,
burning, shredding or by other ways of destroying them.

6. Records Disposition actions taken regarding public records


after they are no longer needed in the conduct of current agency
business and have surpassed their prescribed retention period.
7. Records Disposition Schedule (RDS) refers to the listing of
records series showing for each records series the period of time
it is to remain in the office area, in the storage (inactive) area and
its preservation or destruction.
8. Records Inventory - a description list of the record holdings of
an agency. It is usually done by records series.
9. Records Management Improvement Committee (RMIC)
refers to a group of key officials and employees designated by the
head of the agency and given the task to oversee its records
management activities.
10. Records Officer - refers to an employee responsible for
overseeing the records management program and providing
guidance on proper records maintenance and disposition.
11. Records Retention - the maintenance of records which by
the nature of their appraised value, cannot yet be disposed.

12. Records Series - refer to a group of related records arranged


under a single unit or kept together as a unit because they deal
with a particular subject, result from the same activity or have a
special form.

13. Retention Period - refers to the specific period of time


established and approved by the NAP as the life span of records,
after which they are deemed ready for permanent storage or
destruction.
14. Time Value refers to the specific period of usefulness of the
records.
Permanent these records have administrative,
legal, research, historical or archival significance and
are worthy of preservation.
Temporary Records can be disposed of when they
have served the purpose for which these records
were created or when action on them have been
accomplished or terminated.
15. Utility Value this concerns the nature of usefulness of the records to the
agencys operations. Temporary or permanent records are further appraised
on the basis of their usefulness, these are :
Administrative Value records of this value serve as
administrative tools to accomplish the mission of the
organization (Directives and Issuances, Office Methods and
Procedures, Correspondence, Reports).

Archival Value - refers to the historical or research


significance of records or documents which may be derived
from records such as the creation and development of an
agency, its policies and procedures that could be used as
basis of research. (Records dealing with agency
development, organization, functions, policies, standard
operating procedures).

Fiscal Value - those which serve as tools in discharging the


financial obligations of the agency (Payrolls, Vouchers,
Official Receipts, Budget Estimates).

Legal Value - those which state legal decisions and


opinions, either of a permanent or temporary character.
These records generally give protection to the civil, legal,
property and other rights of the citizens (Land Titles,
Contracts and Claims).
16. Valueless Records - refers to all records that have reached
the prescribed retention periods and outlived the usefulness to the
agency or the government as a whole.
II. IMPLEMENTING GUIDELINES
A. GENERAL POLICIES
1. All Central Office departments/Regional/Provincial Offices
should establish and maintain an active continuing program
directed to the application of efficient records management
pertaining to the creation, utilization, maintenance, retention,
preservation and disposal.
2. In coordination with General Services Department (GSD) and
Technical Research and Services Department (TRSD), all
Regional Managers/Provincial Managers through the Regional
Administrative Officers (RAOs)/Provincial Administrative Officers
(PAOs) are required to establish their respective Records Center
for the storage and archiving of active and non-current records.
This is in consonance with Item 3.2, Article III of NAP Circular No.
1 dated January 20, 2009.

In the Central Office, the Records Center is located at ACA


Valenzuela where all archival records of all Central Office
departments/offices shall be stored.
3. The Records Management Improvement Committee (RMIC)
created per latest Special Order shall act as an overall advisory
body on the development of records management (per Article III,
Rule 3, item 3.4 of NAPs General Circular No. 1, dated January
20, 2009).
4. It shall be the responsibility of the Department Manager/Head
of Office/Regional Manager/Provincial Manager to see to it that
the herein stated provisions are strictly observed and
implemented.
B. SPECIFIC POLICIES

1. RECORDS AND ARCHIVES MANAGEMENT


a. The GSD Records Officer IV in the Central Office and the
Regional Managers/Provincial Managers through the
RAOs/PAOs of the respective field offices shall be
responsible for :

a.1 Coordinating the prompt setting-up of their respective


Records Center (in coordination with TRSD).
a.2 Organizing and overseeing a Records
Management Program as follows :
- Implementing a system for the sorting,
classifying, filing and safekeeping of
current and active records;

- Adopting ways of protecting records


against fire, flood, dust, excessive heat
and dampness, loss or destruction and
preserving the originality and reliability of
NFA documents; and
- Segregating valueless records for
disposal based on the approved NFA
Records Disposition Schedule (RDS)
(Annex A) and NAPs GRDS (Annex C).
b. In establishing a Records Center, GSD and all ROs/POs
shall comply with the Guidelines in Setting-Up a Records
Center (Annex B).
c. Records inventory and appraisal shall be conducted
every January by the Records Officers (Designated
Administrative Officers in the Central Office departments
and the RAOs/PAOs in the Regional/Provincial Offices).
d. The GSD Records Officer IV/RAOs/PAOs shall, at the
expiration of their term of office, turnover to their successor
all NFA records under their custody.
2. RECORDS DISPOSITION

2.1 RECORDS DISPOSITION SCHEDULE


a. The Records Officers IV, II and I of the
General Services Department
Communications and Records Management
Division (GSD-CRMD) shall maintain a
comprehensive NFA Records Disposition
Schedule (RDS) (Annex A) for reference of the
Central Office departments/Regional/Provincial
offices. This shall be reviewed annually, revised
and updated if necessary. Whenever the NAP
issues a change to the General Records
Disposition Schedule (GRDS) (Annex C), the
GSD Records Officers IV, II and I have to
update the NFA RDS accordingly.
b. The approved NFA RDS (Annex A) which was
patterned after the NAPs GRDS (Annex C) common
to all government offices and which was approved by
the Executive Director of NAP on February 16, 2012
shall be implemented by the NFA Management. It
shall serve as the agencys guide in the evaluation,
appraisal and disposal of NFA records. Any revision
or change in the schedule indicated in the NFA RDS
shall likewise be submitted to the Executive Director
of NAP for approval.

c. All Central Office departments/Regional/Provincial


Offices shall not dispose of their records earlier than
the period indicated for each record series in the
approved NFA RDS. However, records may be
retained for longer periods if there is a need to do so.

2.2 INVENTORY AND APPRAISAL OF RECORDS


.
a. Records inventory and appraisal shall be conducted
every January by the designated Administrative
Officers/RAOs/PAOs using the Records Inventory and
Appraisal Form(ExhibitA).
b. Records inventory shall be conducted for the
following purposes:
- To verify and locate records;
- To determine the volume of record
holdings;
- To evaluate the age of records; and
- To determine the present and future
needs of the agency in terms of
personnel, floor space, equipment and
the like
c. Appraising of records must be performed by
the designated Administrative
Officers/RAOs/PAOs according to time value
(permanent or temporary) or utility value
(administrative, fiscal, legal and archival).
d. Computation as to volume of inventoried records
shall be expressed in cubic meters based on the
Table of Ratio Factor (Annex D).
2.3. REVIEW AND TRANSFER OF NON-CURRENT / INACTIVE
RECORDS TO THE RECORDS CENTER
a. Inspection, Review and Transfer of Records
a.1 Central Office

Aside from the inventory and appraisal, the


designated Administrative Officers shall also
inspect and review the retention periods of all
files (active / inactive / current / non-current)
every January of each year. When necessary,
they shall recommend the transfer of records to
the ACA Records Center in accordance with the
retention periods in the approved NFA RDS
(Annex A).
The designated Administrative Officers shall
submit every 3rd quarter of January, the
Request for Transfer of Records to the Records
Center (Exhibit B.1) together with the Records
Transfer List (Exhibit C), both in triplicate, to
GSD-CRMD for inspection and evaluation, and
approval by the GSD Department Manager. The
copy distribution are as follows :
1 - Transferring Department/Office
2 - GSD-Communications and Records
Management Division
3 - ACA Records Center
Upon receipt of the request, GSD-CRMD shall
inspect and evaluate the records. If in order, the
request shall be forwarded to the GSD
Department Manager for approval.

If the request is approved, GSD-CRMD shall


coordinate with the requesting
department/office on the schedule or date of the
actual transfer of records to ACA Records
Center.

a.2 Regional/Provincial Offices

The Heads of each Section shall inspect and


review the retention periods of all files (active /
inactive / current / non-current) every January of
each year. When necessary, they shall
recommend the transfer of records to the
Regional/Provincial Office storage area in
accordance with the retention period in the
approved NFA RDS (Annex A).

The Section shall submit the Request for


Transfer of Records to the Records Center
(Exhibit B.2) together with the Records
Transfer List (Exhibit C), both in triplicate, to
their respective RAOs/PAOs for inspection and
evaluation, and approval by the
Regional/Provincial Manager. The copy
distribution are as follows:
1 - Transferring Section
2 - RAOs/PAOs
3 - Records Center

Upon receipt of the request, RAOs/PAOs shall


inspect and evaluate the Records Transfer List
(Exhibit C). If in order, the request shall be
forwarded to the Regional/Provincial Manager
for approval.

If the request is approved, RAOs/PAOs shall


coordinate with the requesting section on the
schedule or date of the actual transfer of
records to their records center.

b. Packing of Records for Transfer to the Records


Center for Storage

The requesting department/office or section


shall pack in a box all records to be transferred
to the Records Center for storage. The required
sizes of box for storage shall be with a length of
40 cm., width of 30 cm., and height of 29 cm.

The box shall be properly labeled for


identification following the Box Label format in
Exhibit D, to facilitate easy retrieval of files.
The label should be placed at the side of the
box.

c. Physical Transfer

The designated Administrative Officers/Heads


of Section shall effect the actual transfer of
records to the GSD CRMD / RAOs / PAOs.
GSD-CRMD/RAOs/PAOs shall then transfer the
records to their designated records center for
storage/disposal.
2.4 RECORDS DISPOSAL
a. Article No. 36 of RA 9470 states that no officer,
member or employee of any agency of the
government, whether national or local, or any political
subdivision thereof shall destroy, sell or otherwise
dispose of any public records or printed public
document in such persons care or custody or under
such persons control without first having secured
authority from the National Archives of the Philippines
of their nature and obtained its authorization.

b. Procedures for records disposal of central and field


offices shall be as follows :

b.1 Central Office

b.1.1 Every January of each year, the Records


Custodian at the ACA Valenzuela shall accomplish
the Request for Authority to Dispose of Records
(Exhibit E) in four (4) copies. He/She shall properly
fill-out the specific records series title and description,
period covered and authorized retention period based
on the approved NFA RDS (Annex A) and GRDS
common to all government agencies (Annex C). Any
record/document not included in the NFA-RDS and
GRDS must not be disposed.

b.1.2 The Records Custodian shall endorse the


Request for Authority to Dispose of Records (Exhibit
E) with a covering memo to GSD-CRMD, for
screening and evaluation, not later than the 1st week
of February. The records listed for disposal should
have surpassed their prescribed retention period or
their disposal should have complied with specific
provisions of the NFA RDS and GRDS.

b.1.3 After screening and evaluation,


GSD-CRMD shall finalize the list in
Exhibit E and prepare a Memo
Transmittal to be recommended for
approval by the members of the RMIC
[Department Managers of the Legal
Affairs Department (LAD) and the Internal
Audit Services Department (IASD)] and
approved by the RMIC Chairperson
(Deputy Administrator for Finance and
Administration], prior to endorsement to
the NAP for their re-evaluation and
approval.

b.1.4 A Certification (Exhibit F) from the


concerned Department Manager/Head of
Office/s shall be filled-out by the
designated Administrative Assistant of the
concerned department/office. The
Certification states that the records for
disposal that are subject for audit were
post audited and finally settled, those
involved in a case or investigation were
finally decided upon or settled and that
those records are no longer needed and
not involved nor connected with any
administrative or judicial cases. This shall
be secured by GSD from the concerned
department, to be submitted together with
the Request for Authority to Dispose of
Records (Exhibit E) and a transmittal
memo to be approved by the RMIC.

b.1.5 The GSD Department Manager


must sign the certify and approve by
portion of the Request for Authority to
Dispose of Records form (Exhibit E) to be
submitted to the NAP.
b.1.6 The NAP shall evaluate and
appraise the listed records for disposal. If
the document does not conform with NFA
RDS and GRDS, the listed records shall
be returned to the GSD-CRMD for re-
evaluation and revision. If the NAP find
the list of documents in order, the NAP
shall issue a Notification of Approval and
the Records Management Analysis
Report (RMAR) to the RMIC through
GSD.
b.1.7 GSD-CRMD, upon receipt of the
Notification of Approval and RMAR, may
resort to any of the following:
Conducts bidding in
accordance with RA 9184
Conducts landfill for damaged
records
Prepares letter to NAP if
RMIC through GSD-CRMD
opt to avail the services of the
NAPs official buyer
b.1.8 The GSD-CRMD shall coordinate
with the NAP and COA on the schedule of
actual disposal of records.

b.1.9 The concerned requesting


department / office shall pack in a box all
records to be transferred to the Records
Center for disposal. The required sizes of
corrugated box shall be with a length of
62 cm., width of 38 cm., and height of 27
cm.

b.1.10 Actual disposal of records shall be


undertaken by the GSD-CRMD, NAP and
COA representative. The NAP shall issue
GSD-CRMD a copy of the Certificate of
Disposal for their file.
b.2 Field Offices
b.2.1 Disposal of records shall be
undertaken by the RAOs/PAOs every
January of each year and they shall
accomplish the Request for Authority to
Dispose of Records (Exhibit E) in four (4)
copies.

b.2.2 The RAOs / PAOs shall properly fill-


out the specific records series title and
description, period covered and
authorized retention period based on the
approved NFA RDS (Annex A) and
GRDS common to all government
agencies (Annex C). Any
record/document not included in the NFA-
RDS and GRDS must not be disposed.
The RM / PM must sign the certify and
approve portion of the Request for
Authority to Dispose of Records form
(Exhibit E), to be submitted to the NAP.

b.2.3 The RAOs/PAOs shall endorse the


Request for Authority to Dispose of
Records (Exhibit E) to GSD-CRMD with a
covering memo for screening and
evaluation, not later than the 1st week of
February. The records listed for disposal
should have surpassed their prescribed
retention period or their disposal should
have complied with specific provisions of
the NFA RDS and GRDS.

b.2.4 If there are corrections after


screening and evaluation, GSD-CRMD
shall return the corrected Request for
Authority to Dispose of Records, to the
RAO/PAO for corrections and finalization.

b.2.5 After finalization, the RAO/PAO


shall forward the Request for Authority to
Dispose of Records to the Regional
Manager/Provincial Manager for approval.
Upon approval, this shall be returned by
the RAO/PAO to GSD-CRMD.

b.2.6 Upon receipt of the finalized


Request for Authority to Dispose of
Records, GSD-CRMD shall prepare a
Memo Transmittal to be recommended for
approval by the members of the RMIC
[Department Managers of the Legal
Affairs Department (LAD) and the Internal
Audit Services Department (IASD)] and
approved by the RMIC Chairperson,
Deputy Administrator for Finance and
Administration], for endorsement to the
NAP for their re-evaluation and approval.
b.2.7 A Certification (Exhibit F) from the
concerned Regional Manager/Provincial
Manager shall be filled-out by the RAO/PAO of
the concerned regional/provincial office. The
Certification states that the records for disposal
that are subject for audit were post audited and
finally settled, those involved in a case or
investigation were finally decided upon or
settled and that those records are no longer
needed and not involved nor connected with
any administrative or judicial cases. This shall
be secured by GSD from the concerned
RO/PO, to be submitted together with the
Request for Authority to Dispose of Records
(Exhibit E) and a transmittal memo to GSD to
be approved by the RMIC.

b.2.8 The NAP shall evaluate and


appraise the listed records for disposal. If
the document does not conform with NFA
RDS and GRDS, the listed records shall
be returned by NAP to the GSD-CRMD.
GSD-CRMD shall then return it to the
regional/provincial office for re-evaluation
and revision. The corrected Request for
Authority to Dispose of Records shall be
returned by the regional/provincial office
to GSD-CRMD for endorsement again to
the NAP. If the NAP find the list of
documents in order, the NAP shall issue a
Notification of Approval and the Records
Management Analysis Report (RMAR) to
the RMIC through GSD. GSD-CRMD
shall then furnish a copy of the
Notification of Approval and RMAR to the
concerned regional/provincial office.

b.2.9 The RAOs/PAOs, upon receipt of


the Notification of Approval and RMAR,
may resort to any of the following:
Conducts bidding in
accordance with RA 9184
Conducts landfill for damaged
records
Prepares letter to NAP if
RMIC through GSD-CRMD
opt to avail the services of the
NAPs official buyer
b.2.10 The RAOs/PAOs shall coordinate
with the NAP and COA in their area on
the schedule of actual disposal of
records.
b.2.11 The concerned requesting section
shall pack in a box all records to be
transferred to the Records Center for
disposal. The required sizes of corrugated
box shall be with a length of 62 cm., width
of 38 cm., and height of 27 cm.

b.2.12 Actual disposal of records shall be


undertaken by RAO/PAO, NAP and COA
Representative. The NAP shall issue the
RAO/PAO a copy of the Certificate of
Disposal for their file. GSD-CRMD shall
be furnished copies of all documents
pertaining to the disposal.
2.5 MODES OF DISPOSAL
The following modes of disposal of records may be resorted to by the GSD -
CRMD/Regional/Provincial Office, whichever is advantageous to the agency :
a. Burying/Landfill
Disposal of solid waste such as papers and the
like, by burying it between layers of dirt and
other materials in such a way as to reduce
contamination of the surrounding environment.
b. Shredding
This is a process by which records are first fed
into a machine to be cut into small pieces to
prevent unauthorized reading or reproduction of
its contents.
c. Sale
The guidelines on Government Procurement
Reform Act (RA 9184) shall be followed in the
selection of contracted buyer. A copy of the
contract shall be submitted to the NAP prior to
its actual disposal. NFA may choose to conduct
its own public auction but the minimum bid price
should not be less than the price of NAP. In
case the GSD/R.O./P.O. opts to avail the
services of the NAPs official buyer, a letter of
availment shall be submitted to the NAP.
2.6 ACTUAL DISPOSAL

a. Actual disposal of records in the central office shall


be conducted in the presence of GSD Records
Officer, NAP and COA representative.
b. In the Regional/Provincial Offices, actual disposal
shall be conducted in the presence of RAOs/PAOs,
NAP and COA representative in their area. The GSD
Records Officers in the Central Office shall no longer
be required to go to the Regional/Provincial Office to
witness their records disposal to minimize expenses.
c. A Certificate of Disposal shall be prepared and
issued in three (3) copies by the NAPs authorized
representatives who will ensure that all pertinent data
are complete. Copy distribution shall be : 1 NAP; 2
COA and 3 GSD Records Officers/R.O./P.O.
d. All proceeds attained from the sale of valueless
records shall be remitted by GSD Records
Officers/RAOs/PAOs to the Budget Treasury and
Fund Management Department
(BTFMD)/Regional/Provincial Cashier as National
Fund.
e. GSD CRMD shall be furnished a photocopy of
the documents created for the actual disposal of the
valueless records for monitoring and reference of the
NFA RMIC, as follows :

- Certificate of Disposal issued by the NAP

- Truckscale or Platform Weight Ticket


- Official Receipts (ORs)

- Contract for Sale of Valueless Records

2.7 DISPOSAL OF DAMAGED PUBLIC RECORDS


a. In case of disposal of damaged permanent public
records and damaged public records that have not yet
surpassed their prescribed retention periods, follow
same procedures mentioned in item II.B.2.2.4.b of
Records Disposal but the following requirements shall
be attached to the Request for Authority to Dispose of
Records :
a.1 Official Report to be issued by the
designated Administrative Officer/RAO/RAO,
pertaining to the non-usability and extent of
damage done to the records, causes of the
damage to the public records, photo
documentation and information on where other
agency records series the data or information of
the damaged public records can be found.

a.2 Certification from GSD Department


Manager/ Regional Manager/Provincial
Manager that the said damaged public records
that are subject of audit by the Commission on
Audit (COA) were post-audited and finally
settled. Likewise, Certification from LAD that the
records involved in a case or investigation were
finally decided upon or settled.
a.3 If expediency demands and upon the order
of the NAPs Executive Director, an official
report from the NAPs representative who shall
conduct an actual physical inspection and
evaluation of damaged public records.
a.4 Certification from the Regional / Provincial
Disaster Management Unit that the area was
affected by a calamity, disaster or emergency
situation causing the damage of
records/documents.
3. ACCESS CONTROL/RETRIEVAL OF RECORDS
Records needed by a department/office/F.O. Section which are already stored
in the ACA/Regional/Provincial Records Center may be accessed subject to
the following:

a. The requesting department/office/F.O. Section shall fill-out the


Request for Retrieval of Records in triplicate copies (Exhibit G).
This shall be approved by the GSD Department
Manager/Regional Manager/Provincial Manager.

b. Upon receipt of the request by GSD in the Central Office or


Administrative and General Services (AGS) in the
Regional/Provincial Offices, the GSD-CRMD/RAOs/PAOs shall
coordinate with the Records Custodian assigned in their
respective Records Center regarding the request for retrieval of
records.

c. The Records Custodian assigned in the Records Center shall


make these records available for use to persons having legitimate
reasons for consulting or using them.

d. The retrieved records shall be forwarded by the Records


Custodian assigned in the Records Center to the GSD Records
Officer/RAOs/PAOs who shall then notify the requesting
office/department of its availability. The documents shall be
received by the requesting official/employee.

4. OFFENSES AND PENALTIES, TERMINATION FROM OFFICE AND


SUSPENSION AND LOSS OF BENEFITS UNDER THE PROVISIONS
OF RA 9470

a. OFFENSES AND PENALTIES

a.1 Art. 123) A person who, willfully or negligently,


damages a public record or disposes of or destroys a public
record in violation to the provisions of R.A. 9470 or
contravenes or fails to comply with any provision of said Act
or these Rules shall be deemed to have committed an
offense.

a.2 (Art. 124) Any public officer committing any of the


unlawful acts or omissions mandated under this act shall be
punished by a fine of not less than Five Hundred Thousand
Pesos (Php 500,00.00) but not exceeding One Million
Pesos (Php 1,000,000.00) or be imprisoned for not less
than five (5) years but not more than fifteen (15) years
and/or both fine and imprisonment at the discretion of the
court without prejudice to the filing of administrative charges
that would result to such public officers perpetual
disqualification from public office, and forfeiture, in favor of
the government, of his salary and other income.

a.3 (Art. 125) Any violation of R.A. 9470 proven in a proper


administrative proceeding shall be sufficient cause for removal or
dismissal of a public officer, even if no criminal prosecution is
instituted against him.

a.4 (Art. 126) Any person who is convicted of an offense


under R.A. 9470 may, in addition to any penalty imposed for
violation, be prohibited by order of the court from having
access to the National Archives of the Philippines for any
period that the court deems appropriate.
b. TERMINATION FROM OFFICE
b.1. (Art. 129) No public officer shall be allowed to resign or
retire pending an investigation, criminal or administrative, or
pending a prosecution against him, for any offence under
R.A. 9470 or under the relevant provisions of the Revised
Penal Code.

b.2 (Art. 130) Administrative proceedings for violation of


these Rules shall be in accordance with Civil Service Laws
and Rules.

c. SUSPENSION AND LOSS OF BENEFITS


c.1. (Art. 131) Any public official against whom any criminal
prosecution under valid information under R.A. 9470 or
under the relevant provisions of the Revised Penal Code
pending in court shall be suspended from office.
c.2. (Art. 132) Should such official or employee be
convicted by final judgment, he/she shall lose all retirement
or gratuity benefits under any law. However, if acquitted,
he/she shall be entitled to reinstatement and to the salaries
and benefits denied of him/her during suspension, unless
administrative proceedings have been filed against
him/her.
5. RESPONSIBILITIES:

a. Inventory and Appraisal of Records


a.1 Designated Administrative Coordinates with the Division / Section and jointly
Officers/RAOs/PAOs conducts inventory and appraisal of all records using
the Records Inventory and Appraisal Form (Exhibit
A).

a.2 Department Manager/ Approves the Records Inventory and Appraisal Form
Head of Office/Regional
Manager/Provincial Manager

b. Review and Transfer of Non-Current/Inactive Records to the


Records Center

b.1 Designated Administrative Inspects and reviews


Officers/F.O. Section the files.

Accomplishes the
Request for Transfer
of Records to the
Records Center
(Exhibit B.1 and B.2)
and Records Transfer
List (Exhibit C) in
triplicate copies and
submits to GSD-
CRMD/RAO/PAO for
inspection and
evaluation.

Upon receipt of the


approved request,
packs and labels
boxes in accordance
with Exhibit D (Box
Label) format.
b.2 GSD-CRMD / RAO / PAO Inspects/Evaluates
Exhibits A and B. If in
order, forwards to the
GSD Department
Manager/Regional
Manager/Provincial
Manager for approval.

Coordinates with the


designated
Administrative
Officers/Heads of
Section on the
schedule or date of
the actual transfer of
records.

Once request is
approved, effects
actual transfer of
records to the
Records Center.
b.3 GSD Department Manager / Regional Approves/Disapproves
Manager / Provincial Manager Request for Transfer
of Records to the
Records Center

c. Records Disposal

c.1 ACA Records Accomplishes the Request for Authority


Custodian/ to Dispose of Records (Exhibit E) based
RAOs/PAOs on NFA RDS and GRDS.

Note : An advance copy of Exhibit H may


be sent by the RAO/PAO to the GSD-
CRMD thru email at

nfa.gsd.crmd@gmail.com
nfa.gsd.crmd2015@gmail.com.

Endorses the Request for Authority


to Dispose of Records with a
covering memo to GSD-CRMD.
Whenever there is a correction,
corrects Request for Authority to
Dispose of Records and returns to
GSD-CRMD for re-evaluation.
c.2 GSD-CRMD For the field offices, after a thorough
screening and evaluation of the
Request for Authority to Dispose of
Records, returns the corrected
Request for Authority to Dispose of
Records to the concerned
Regional/Provincial Offices for
approval of the RM/PM
For the central office, GSD-CRMD
evaluates, finalizes and endorses to
RMIC for approval the Request for
Authority to Dispose of Records
from ACA Records Center for
eventual endorsement to NAP for
re-evaluation and approval.

GSD-CRMD transmits to RO/PO the


NOA and RMAR approved by NAP.
c.3 Department Approves/Disapproves the Request
Manager, for Authority to Dispose of Records
GSD/Regional
Manager/Provincial
Manager
c.4 Designated Upon receipt of Notification of
Administrative Approval and RMAR, transmits
Officers/FO Section records to GSD-CRMD/RAO/PAO
c.5 GSD-CRMD- Upon receipt of the Notification of
RAO/PAO Approval, resorts/opts to any of the
following :
Conducts bidding in
accordance with RA
9184
Conducts landfill for
damaged records
Prepares letter to NAP if
the concerned
department/office opts
to avail the services of
the NAPs official buyer
Coordinates with the NAP and COA
on the schedule or date of actual
disposal of records
c.6 GSD-CRMD / Conducts the actual disposal of
RAO /PAO/NAP and records
COA Representative

d. Access Control/Retrieval of Records from the Records Center


d.1 Accomplishes the Request for
Requesting Retrieval of Records (Exhibit G) in
official triplicate and forwards to DM/RM/PM
for signature/approval.
/employee
d.2 Department Manager Approves/signs the Request for Retrieval of
/RM/PM/OIC Records
d.4 Records Custodian Retrieves the records and
forwards to the GSD-
CRMD/RAO/PAO
d.5 Requesting Receives the records/documents and
official/employee affixes his/her name and signature in
the received by portion of the
logbook of GSD- CRMD/RAO/PAO
6. DATA FLOW DIAGRAM

Inventory, Appraisal, Inspection, Review and Transfer of


Non- current/Inactive Records to the Records Center
(Annex E)

Records Disposal

b.1 Central Office (Annex F.1)

b.2 Field Office (Annex F.2)

Access Control/Retrieval of Records from the Records


Center (Annex G)
The foregoing SOP supersedes SOP No. 05012 approved July 30, 1983 and
its Amendment to the SOP (SOP No. 05012.A) approved July 19, 2004. All
rulings and/or issuances inconsistent herewith are hereby superseded.

This SOP shall take effect this 27th day of April, 2016.

RENAN B. DALISAY

Administrator

Date approved : April 27, 2016

III. RESPONSIBILITIES

IV. FLOW CHART


Top Page
EXHIBITS
Annex B - Guidelines in Setting-up a Records Center
Annex D - Table of Ratio Factor
Exhibit A - Records Inventory and Appraisal
Exhibit B.1 - Request for Transfer of Records to the Records Center
Exhibit B.2 - Request for Transfer of Records to the Records Center
Exhibit C - Records Transfer List
Exhibit D - Box Label
Exhibit E - Request for Authority to Dispose of Records
Exhibit F - Certification
Exhibit G - Request for Retrieval of Records
Annex E - Inventory, Appraisal, Inspection, Review and Transfer of Non-Current/Inactive Records to the
Records Center
Annex F.1 - Records Disposal (Central Office)
Exhibit F.2 - Records Disposal (Field Office)
Annex G - Access Control/Retrieval of Records from the Records Center
SOP Library
SOP NO: GS-PD10 (List of Exhibits/Attachments)

Mission: Finance and Administration

Area: General Services (GS)

Activity: Purchasing/Inspection and Fixed Asset Disposition (GS-PD)

Title: Bid and Surety (Performance) Bonds

Date Approved/Issued: 07/09/1990

Date Effective: 07/16/1990

Digest:

I. TERMS OF REFERENCE
A. Rationale
B. Objective
C. Scope
D. Basis

II. IMPLEMENTING GUIDELINES

A. Bid or Bidder's Bonds


1. Posting of a bid or bidder's bond in favor of the NFA shall be
required from all prospective contractors for procurement of
materials and services/disposition of unserviceable fixed assets
and materials subject to public bidding. This shall serve as a
guarantee that the successful bidder shall within seven calendar
days from notice of receipt of award enter into contract with the
NFA and furnish the surety (performance) bond for the faithful and
complete prosecution of the work specified in the contract
documents.

The presence of a collecting officer during the bidding process


shall be required to acknowledge receipt of bid bonds.

2. The bidder's bond shall be in the form of cash, cashier's or


manager's check, letter of credit issued by a commercial bank or a
surety bond (Bidder's Bond) callable on demand issued by the
Government Service Insurance System or a surety companyt duly
accredited by the Office of the Insurance Commissioner subject to
NFA acceptance. The amount of the bidder's bond required shall
be indicated in the Instruction to Bidders.

3. The bidder's bond shall be valid for a reasonable period to be


determined by the Committee on Bids and Awards
(CBA)/Disposition Committee (DC) as specified in the Instruction
to Bidders. However the period shall in no case exceed 120
calendar days following the opening of the bids.

4. The bid bonds of all, except the next lowest (for procurement of
materials and services) or highest (disposition of unserviceable
fixed assets and materials) complying bidders whose bids appear
to be the most advantageous to the NFA, shall be returned after
the opening of bids upon the request of the bidders.

5. Any bid bond maybe withdrawn before the award is made. The
withdrawal shall be construed as a waiver by the bidder
concerned for the award of the contract.

6. The remaining bid bonds shall be returned after the successful


bidder has signed the contract and furnished the surety
(performance) bond. This shall be made not later than the
expiration of the validity period indicated in the Instruction to
Bidders.

7. Refusal or failure of the winning bidder to enter into contract


with the NFA within seven days from award shall mean forfeiture
of the bid bond.
B. Surety (Performance) Bonds
1. Prior to the award, the winning bidder shall be required to post
a surety (performance) bond in favor of the NFA. The surety
(performance) bond shall guarantee the faithful performance of
the terms and conditions of the contract awarded. This shall also
answer for any loss that may be incurred by the NFA in the event
of the contractor's failure to perform his obligations provided in the
contract.

2. The surety (performance) bond shall be in the form of cash,


manager's or cashier's checks or surety bond (Performance
Bond) callable on demand issued by the GSIS or a private surety
company acredited by the Office of the Insurance Commissioner
subject to NFA acceptance. The amount of the surety
(performance) bond required shall also be indicated in the
Instruction to Bidders.
C. Safekeeping and Release of the Bonds Posted
1. All bidder's bonds shall be in the custody of the NFA Central
Office regular collecting officer assigned for the particular
bidding/Field Office Cashier.

2. A Bidder's Bond Acknowledgment Receipt (Exhibit 1) shall be


issued for the bidder's bonds received. This shall be
accomplished in 2 copies (Copy 1: Bidder; Copy 2: NFA Central
Office Collecting Officer/Field Office Cashier).

3. Any losing bidder shall request for the release of his bid bond
thru the same document. The "Release of Bidder's Bond" portion
of the form shall be approved by the Chairman of the CBA/DC.

4. The approved request shall be the basis for the release of the
bidder's bond by the collecting officer.

5. The bid bond of the winning bidder in cash or check form shall
be receipted with an official receipt (OR) and shall be subject to
the usual cash collection and deposit policies.

This policy shall also be applicable to the cash bond of the next
complying bidders withheld by the NFA as required by the bidding
policies. However, if the bid bonds are in check form, the policy on
the issuance of official receipt shall not be adopted to facilitate the
return of the checks to the bidders.

In case the contract is awarded to any of the next complying


bidders upon failure of the winning bidder to execute the contract
and post the required surety (performance) bond, the bid bond in
check form of the new prospective contractor shall be receipted
and deposited to the NFA account.

6. For reference, the original and duplicate copies of the bidder's


bond acknowledgement receipt shall reflect the number and date
of the corresponding OR issued.
7. Bid bonds of the winning bidder in surety form shall not be
subject to the collection and deposit procedures. This shall be
kept by the collecting officer for purposes of effecting subsequent
collection from the surety company in the event forfeiture of the
bid bond shall be undertaken.

8. After the signing of the contract and posting of the required


surety (performance) bond by the winning bidder, thebid bonds of
the next complying bidders withheld shall be released upon the
request of the bidders as approved by the Chairman of the
CBA/DC.

Cash bond already deposited shall be refunded thru the usual


disbursement voucher (DV) system. The approved request shall
be attached to the DV to be certified by the Chairman of the
CBA/DC. Claims for refund of bidder's bondsshall be prioritized in
voucher processing.

9. The bid bond of the winning bidder shall be returned after he


had signed the contract and posted the surety (performance)
bond as authorized by the CBA/DC Chairman thru the "Release of
Bidder's Bond" portion of the Bidder's Bond Acknowledgment
Receipt. The form shall indicate that a surety (performance) bond
had been posted.

The official receipt number and date for bonds posted in cash or
check shall be reflected on the form.

Bid bond deposited to the NFA account shall be refunded thru the
usual DV system with the "Release of Bidder's Bond" as
attachment.

10. Surety (performance) bonds shall be under the custody of the


Cash Division of the Directorate for Treasury and Fund
Management/Field Office Cashier. Official receipts shall be issued
for surety (performance) bonds posted in cash or check to be
deposited to the NFA account. Receipt of surety (performance)
bond in surety form shall be evidenced with an acknowledgement
receipt issued by the DTFM / F.O. Cashier.

A copy of the OR or acknowledgement receipt shall be provided


by the DTFM / F.O. Cashier to the implementing office(s) which
shall monitor the contract implementation. A copy of the surety
(performance) bond in surety form shall also be provided to the
implementing office(s) for purposes of determiningthe liabilities
under the bond.

11. Release of surety (performance) bond shall be authorized thru


the use of an Authority to Release Surety (Performance) Bond
(Exhibit 2). This shall be signed by:
11.1 Central Office: Heads of Offices or Directorates
concerned in the implementation of the terms and
conditions of the contract and DAB/ DTFM/ DLA
Directors.

The signing authority of the respective official shall


apply to his area of responsibility.

11.2 Field Offices: Regional Director or


Provincial Manager.

The authority of the Regional Director or Provincial


Manager to release surety (performance) bonds shall
cover those bonds for decentralized contracts.
12. Surety (performance) bonds posted in cash or check which
had been deposited to the NFA account shall be refunded to the
contractor thru the usual DV system. The Authority to Release
Surety (Performance) Bond and the original copy of the NFA
official receipt for the surety (performance) bond shall be attached
to the DV.

The Authority to Release Surety (Performance) Bond shall be


required for release of surety (performance) bond in surety form.

13. Any official who through misrepresentation or fraudulent


action caused the release of the bid and surety (performance)
bond to the contractor shall be held responsible and liable.
Furthermore, he shall be held answerable for any NFA claim
against the contractor which was not settled due to the irregular
release of the bond.
D. Forfeiture of Bid Bonds / Application of Surety (Performance) Bond
1. The bid bond of the winning bidder shall be forfeited in case he
fails to enter into contract with the NFA and post the required
surety (performance) bond within seven days from award of the
contract.

2. The Chairman of the CBA/DC shall advise the DTFM thru the
collecting officer assigned for the particular bidding/F.O. Cashier
(for bonds in surety form) and Central Office Accounting
Division/field office accounting unit for purposes of effecting
collections from surety company or forfeiture of the bid bond
posted in cash or check form deposited to the NFA bank account
and recording the transactions in the books of accounts.

The DTFM/ F.O. Cashier shall effect the collections from the
surety company for the forfeited bid bond. The COAD/ accounting
unit shall:

2.1 Set-up NFA claims against the surety company (bid bond in
surety form)
2.2 Adjust the accounting records to take-up the
forfeiture of the bond in cash or check form.
3. The surety (performance) bond of the contractor shall be
applied to any loss that maybe incurrec by the NFA resulting from
the failure of the contractor to comply with the terms of the
contract.

4. The officials in charge of the contract implementation shall


immediately advise the DTFM/ F.O. Cashier (bond in surety form)
and COAD/ accounting unit in case there are claims against the
surety (performance) bond for purposes of effecting collections
from surety company or application of the surety (performance)
bond and recording of transactions in the books of accounts. DLA
shall be furnished a copy of the advice.
E. Accounting Policies
1. The receipt and subsequent release of bid and surety
(performance) bonds posted in surety form shall not be recorded
in the books of accounts. This shall also apply to bid bonds
posted in the form of letters of credits.

Only transactions pertaining to bonds posted in cash or manager's


/cashier's checks which had been deposited to the NFA bank
account shall be recognized in the books of accounts.

2. Accounting entries to take-ip transactions relative to bid and


surety (performance) bonds shall be as follows:
2.1 Receipt and deposit of bidder's bond in cash or
check form based on OR and validated deposit slip:

DR: Cash with Collecting Officer xxx


CR: Depository LIabilities -
Miscellaneous- Bidder's Bonds xxx
#

DR: Cash in Bank xxx


CR: Cash with Collecting Officer xxx

2.2 Release of Bidder's Bonds posted in cash or


check thru DV system:

DR: Depository Liabilities -


Miscellaneous- Bidder's bonds xxx
CR: Vouchers Payable xxx

2.3 Forfeiture of bidder's bond based on advice from


Chairman of tghe CBA/DC.

a. Cash or check (deposited to the NFA account)

DR: Depository Liabilities -


Miscellaneous - Bidder's Bonds xxx
CR: Miscellaneous Income -
Forfeiture of Bid/ Surety
(Performance) Bonds xxx

b. Surety Form (claim from surety company) and


Lettes of Credit (claim from issuing bank)

DR: Receivables - Miscellaneous -


Claims Receivables - Others
(Bid/Surety (Performance Bond) xxx
CR: Miscellaneous Income -
Forfeiture of Bid/ Surety
(Performance Bonds) xxx

2.4 Receipt and deposit of surety (performance) bond


posted in cash or check form based on OR and
validated deposit slip:
DR: Cash with Collecting Officer xxx
CR: Depository Liabilities -
Guaranty Deposits - Surety
(Performance) Bonds xxx
#

DR: Cash in Bank xxx


CR: Cash with Collecting Officer xxx

2.5 Release of Surety (Performance) Bonds posted in


cash or check:

DR: Depository Liabilities -


Guaranty Deposits xxx
CR: Vouchers Payable xxx

2.6 Application of surety (performance) bond:

a. Cash or Check

DR: Depository Liabilities -


Guaranty Deposits - Surety
(Performance) Bonds xxx
CR: Miscellaneous Income _
Forfeiture of Bid/ Surety
(Performance ) Bonds xxx

b. Surety Form (claim from surety company):

DR: Receivables - Miscellaneous -


Claims Receivables - Others
(Bid/ Surety (Performance)
Bonds xxx
CR: Miscellaneous Income -
Forfeiture of Bid/ Surety
(Performance) Bonds xxx
#
In case an expense was incurred by the NFA resulting
from the contractor's non-compliance of the terms of
the contract, a negative debit to the expense accouint
shall be recorded. The excess amount (surety
(performance) bond less expense previously
recorded) shall be recognized as miscellaneous
income. Any deficiency shall be set-up as a
receivable account from the contractor.
Date Approved: July 9, 1990

III. RESPONSIBILITIES

IV. FLOW CHART


Top Page
EXHIBITS
No Exhibit/s Available for this SOP
SOP Library
SOP NO: GS-PD14 (List of Exhibits/Attachments)

Mission: Finance and Administration

Area: General Services (GS)

Activity: Purchasing/Inspection and Fixed Asset Disposition (GS-PD)

Title: Revised SOP on the Disposal of Unserviceable Fixed Assets and Materials
(Junk Properties)

Date Approved/Issued: 05/29/1997

Date Effective: 06/01/1997

Digest:

I. TERMS OF REFERENCE
A. Rationale
B. Objective
C. Scope
D. Basis

II. IMPLEMENTING GUIDELINES

1. Evaluation of Fixed Assets


1.1 Fixed assets shall be evaluated semi-annually (March and
September) or whenever management, thru GSD, deems it
necessary to determine which are :
1.1.1 Serviceable and to be retained or which are to
be enhanced for income generating projects through
efficient and effective administration.

1.1.2 Unserviceable fixed assets to be disposed at


highest value possible.
1.2 For a fixed asset to be considered unserviceable, any of the
following conditions must be present:
1.2.1 The item is considered junk or beyond
economical repair. Beyond economical repair shall
mean that the cost of repair is more than 60% of the
acquisition cost at current prices. However, for motor
vehicles, National Budget Circular No. 446 (series of
1995) shall be implemented.

1.2.2 The item is already obsolete or no longer


needed for NFA operations.

1.2.3 The item is no longer economical to use or


maintain.
1.3 If unserviceable, items for disposal shall be retained, whether
temporarily or permanently, the office concerned shall prepare a
justification indicating its intended purpose for retaining the items.
Also a proposed work program on its utilization shall be
accomplished and submitted directly to the Disposal Committee.
The concerned office shall be responsible in maximizing utilization
of the properties either thru its own use or reporting idle properties
to Central Office for proper relocation.
2. Disposal of Unserviceables
Disposal of unseviceable properties shall be done semi-
annually (every June and November) or otherwise
depending upon the volume, condition of the properties, etc.
Disposal shall be done on a "where is" basis.

Unserviceable properties shall be disposed in the manner


most advantageous to the Agency and to promote the
interest of the general public which may either be one of the
following modes:

2.1 Sale thru Public Bidding - unseviceable properties,


equipment and materials are sold at public auction to the
highest bidder under the supervision of the Disposal
Committee with due consideration to the following:
2.1.1 After advertisement thru printed notice in the
official gazette or in any newspaper of general
circulation for not less than three (3) consecutive
days.
2.1.2 If the value of the property does not warrant the
expense of publication, by notice posted in three (3)
public places where the property shall be sold.
Bidders may also be solicited thru mailed "Invitation to
Bid".
2.1.3 Public Bidding shall be done on an "as is"
"where is" basis. Items for bid shall be grouped in
"lots of similar properties" to draw greater interest
from prospective buyers, thus, higher bid price may
be obtained.
2.1.4 Bids must be accompanied by bidders bond of
at least 10% of the total bid price in cash, manager's
check or cashier's check, which shall be receipted by
a provisional receipt only.
2.1.5 The winning bidder shall effect full payment
within three (3) working days upon receipt of Notice of
Award of Sale, otherwise the bidder's bond shall be
forfeited.
2.1.6 The winning bidder shall withdraw the items
bidded within five (5) working days from receipt of
authority to withdraw. Otherwise, the award may be
cancelled and the bond forfeited.
2.1.7 NFA officials and employees shall not be
allowed, directly or indirectly to participate in the
public bidding of unserviceable properties, equipment
and materials.
This prohibition shall continue to
apply for a period of one (1) year
even after resignation, retirement,
or separation from the agency.
2.2 Negotiated Sale - In the event second public auction
fails, the properties may be sold at a private sale at such
price to be fixed by the Disposal Committee and may be
reviewed by the COA.

2.3 Trade-in - The unserviceable properties may be traded


in for properties needed by the agency. The trade-in value
shall be negotiated at a price not less than its appraised
value or at which the asset may be disposed following the
two previously mentioned modes. Approval of this mode of
disposition shall follow the specification of authority in II.4.

2.4 Unserviceable properties may be exchanged with


properties of other government agencies or other
government controlled corporation which are of use with the
NFA. The value of properties to be received in exchange
shall not be less than the appraised value of the properties
being given away.

2.5 Donation - Unserviceable properties may be given to


selected institution gratuitously with the approval of the
Administrator. The duly approved I & I Report shall be
accompanied by a Fixed Asset Issuance Report to be
acknowledged by the donee/beneficiary. Detailed policies
and procedures regarding donations are contained in the
Revised SOP on Donations and Grants.

2.6 Destruction - That mode of disposal in which unsaleable


junk assets are burned after proper approval/authority and
witnessed by the following:

Central Office:

Technical Audit Div.-IAS, DAS, and COA as observer


Field Office :

Administrative, Accounting and COA as observer.


3. Fixed Assets Disposal Committee
3.1 A Disposal Committee shall be created for both Central
and Field Offices to determine the fair market value of the
unserviceable properties and to undertake the actual
disposal thereof.

3.2. The Disposal Committee shall be reconstituted per


Executive Order No. 309 - Reconstituting the Disposal
Committee created under EO 285. The Committee shall be
composed of the following:

Chairman - Proj. Director, SPO Asst. Reg. Mgr. Prov'l. Mgr/OIC


Members: GSD Representative Reg'l. Adm. Officer Prov'l. Adm. Officer
TSD Rep. Reg'l. Engineer Prov'l. Engineer
DAS Rep. Reg'l. Accountant Prov'l. Accountant
IAS-TAS Rep.
Observer: AO Rep. COA Rep. COA Rep.
COA Rep.

4. Specification of Authority
The approval of the Inventory and Inspection Report
(Exhibit A) and Award of Sale for unserviceable properties
shall follow hereafter specification of authority based on the
acquisition cost of the aggregate properties for disposal.
Donations of whatever kind and value shall be approved by
the Administrator.

4.1 Approval of Inventory & Inspection Report:

a. CENTRAL OFFICE

below P500.00 -

R - Division Chief, GSD-PSMD


A - Dept. Manager, GSD

P500,000 to below P 1M -

R - Dept. Manager, GSD


A - Asst. Administrator for Finance and Administration

P1 M to below P 3M -

R - AAFA
A - Deputy Adm. for Finance and Adm.

P3 M and above

R - Dept. Adm. for Finance and Adm.


A - Administrator
b. FIELD OFFICE

b.1 Provincial Office

P500,000 and below -

R - Adm. Officer/APM
A - Provincial Manager

Above P500,000 to below P 1M

R - Provincial Manager
A - Asst. Regional Manager
P 1 M and above

R - Asst. Regional Manager


A - Regional Manager
b.2 Regional Office

Below P 1M -

R - Regional Administrative Officer


A - Asst. Regional Manager

P1 M and above

R - Asst. Regional Manager


A - Regional Manager
4.2 Approval of the Award of Sales
a. CENTRAL OFFICE
below P 1M -

R - Chairman, Disposal Committee

A - Asst. Adm. for Finance and Adm.

P1M to below P 3M -

R - Chairman, Disposal Committee


A - Dep. Adm. for Finance & Adm.

P3M and above -

R - Chairman, Disposal Committee


A - Administrator
b. FIELD OFFICE

Regardless of amount

R - Chairman, Provincial/Regional
Disposal Committee
A - Regional Manager
5. Documentation and Reporting
5.1.1 Items for disposal shall be properly documented with
the duly approved and pre-numbered Inventory and
Inspection Report supported by equipment appraisal report
and photographs showing two views if practical.

5.1.2 I & I Report shall include the appraised value and shall
be supported with an appraisal report. The actual condition
and current market/resale value of the property especially
motor vehicles shall be considered in the appraisal.

5.1.3 The Inventory and Inspection Report (I & I Report)


shall be prepared by the Supply Officer and shall be
distributed only after the physical disposal has been
effected.

Central Office

Copy 1 - DAS - General Accounting Div.


2 - GSD-PMSDS
3 - GSD-PMMS

Field Office

Copy 1 - Regional Accountant/Provincial Accountant


2 - GSD - PMMS
3 - Supply Officer

5.2 Receipt for Returned Property - (Exhibit B and B.1) -


5.2.1 The Receipt for Returned Property (RRP) shall
be prepared by the employee who wishes to
surrender property accountability previously covered
by MR. The property shall be inspected by a Property
Inspector from IAS to determine its true condition.
Properties returned shall be classified by the Property
Inspector either as serviceable or unserviceable in
which case necessary action shall be recommended.
5.2.2 Separate RRP control number shall be
maintained for junk properties and serviceable ones.
Such control number shall be used for cross-
reference purposes and shall be indicated in the I & I
Report.
5.2.3 The RRP shall be distributed as follows:
Central Office
Copy 1 - Employee
2 - GSD - PMSDS
3 - GSD - PMMS
4 - DAS - GAD

Field Office
Copy 1 - Employee
2 - Supply Officer
3 - Accounting
5.2.4. List of Serviceable Returned Properties shall be
circularized nationwide.
5.3 Report of Waste Material (Exhibit C) -
The Report of Waste Material (RWM) evidences the
surrender of worn-out or obsolete parts of semi-
expendable items for replacement/disposal based on
the inspection report of the Property Inspector. Waste
Materials with resale value shall be stored temporarily
and later offered for bid and those without value shall
be destroyed immediately.

Separate files for the above shall be maintained, each


assigned with corresponding control number series.

Central Office

Copy 1 - DAS - Claims and Inter-Branch Acctng. Div.


*
2 - GSD - PMSDS
3 - GSD - PMMS

Field Office

Copy 1 - Accounting Unit


2 - Supply Officer
3 - Property Inspector

* Supporting paper to voucher if parts are for


purchase
5.4 Fixed Asset Issuance Report
This report (FAIR) is used to document the issuance
of fixed assets by the supply officer under any of the
following instances; i.e. transfer, sale, donation or
other forms of issuances.

Central Office

Copy 1 - Recipient
2 - DAS - GAD
3 - GSD - PMMS
4 - PMSDS/Supply Officer

Field Office

Copy 1 - Recipient
2 - Accounting Unit
3 - Supply Officer
5.5 Quarterly Report on the Disposal of Unserviceable Fixed
Assets and Materials (Exhibit D)
This report shows the amount of proceeds generated from items
disposed and a list of remaining items for disposal. It should be
supported by an approved I & I Report, Appraisal Report, Minutes
of Meeting and Minutes of Bidding attended by the Disposal
Committee. It shall be prepared by field officers and submitted
directly to C.O. - GSD - PMMS five (5) days after end of each
quarter.

5.6 Quarterly Consolidated Report on the Disposal of


Unserviceable Fixed Assets and Materials (Exhibit E)
This report shall be prepared by C.O. - GSD-PMMS
and shall be based on the report (Exhibit D) submitted
by the field offices. It shall contain the total proceeds
generated for the quarter/year by the central and field
offices.
6. Accounting Entries:
6.1 Entry to record/reclassify the property based on RRP:
DR: Junk Assets xxx
DR: Accumulated Depreciation xxx
CR: Fixed Asset xxx
6.2 Entry to write-off assets in the books based on I & I
Report, FAIR and RCD:
6.2.1 Bid price equal to the book value of the asset

DR: Cash with Collecting Officer xxx


CR: Junk Assets xxx

6.2.2 Bid price is less than the book value of the asset
DR: Cash with Collecting Officer xxx
DR: Loss on Sale of Fixed Assets xxx
CR: Junk Assets xxx
6.2.3 Bid price is more than the book value of the
asset
DR: Cash with Collecting Officer xxx
CR: Junk Asset xxx
CR: Gain on Sale of Fixed
Assets xxx
6.2.4 If the fixed asset was not previously classified
as junk assets:

DR: Cash with Collecting Officer xxx


DR: Accumulated Depreciation xxx
DR: Miscellaneous Expense (Loss) xxx
CR: Fixed Asset xxx
or CR: Miscellaneous Income xxx
(Gain on Sale of Fixed Assets)
6.3 The entry to record trade-in shall be based on FARR,
FAIR and disbursement voucher:
6.3.1 If value of newly acquired fixed asset is bigger
than the value of junk asset:
DR: Fixed Assets (new) xxx
CR: Junk Asset xxx
CR: Voucher Payable xxx
6.3.2 If no reclassification to Junk:

DR: Fixed Assets (New) xxx


DR: Accumulated Depreciation xxx
*DR: Retained Earnings xxx
CR: Fixed Asset (old) xxx

*To correct adjust previous charges to Depreciation


Expenses.
III. RESPONSIBILITIES
1. Supply Officer - C.O. - Property Materials and Supplies Disposition
Section (PMSDS)
1.1 Receives returned properties which are documented
with RRP.
1.2 Requests inspection of properties returned and on the
basis of the Property Inspector's recommendation,
segregates serviceable items from those unserviceable
ones. Items which are still repairable or usable shall be
repaired/reissued following the procedures on
repair/property issuance. On the other hand, items which
are found junk with no resale value shall be offered for bid
or disposed under the other modes of disposal other than
public bidding.

1.3 Forwards to DAS-GAD the RRP for the determination of


book value of the junk properties.

1.4 Maintains a separate file of RRP for


serviceable/unserviceable returned properties and assigns
separate control number for each.

1.5 Initiates disposal of accumulated unserviceable


properties. Accomplishes the I & I Report indicating therein
the required information on the basis of previously prepared
RRP.

1.6 Issues FAIR to the winning bidder upon presentation of


the Official Receipt as payment for the property. Submits
other copies to DAS/Accounting Unit; Supply Officer
(C.O./F.O.).
2. Supply Officer - C.O. Property Monitoring & Maintenance
Section (PMMS) -
2.1 Monitors properties and updates inventory records
based on Receipt for Returned Properties, the Inventory
and Inspection Report, and Fixed Assets Issuance Report.

2.2 Serves as the data bank for GSD - PMSDS.

2.3 Receives reports on idle properties and relocates the


same for maximum utilization.
3. Supply Officer (Field Office) -
3.1 Receives properties returned to storage.

3.2 Requests inspection of properties returned and on the


basis of the Property Inspector's recommendation,
segregates serviceable items from those unserviceable
ones. Items which are still repairable or usable shall be
repaired/reissued following the procedures on
repair/property issuance. On the other hand, items which
are found junk with no resale value shall be offered for bid
or disposed under the other modes of disposal other than
public bidding.

3.3 Forwards to Accounting unit the RRP for the


determination of book value of the junk properties.

3.4 Maintains a separate file of RRP for


serviceable/unserviceable returned properties and assigns
separate control number for each.

3.5 Initiates disposal of accumulated unserviceable


properties. Accomplishes the I & I Report indicating therein
the required information on the basis of previously prepared
RRP.

3.6 Deletes junk assets from the list of properties insured.

3.7 Prepares Quarterly Report on the Disposal of


Unserviceable Fixed Assets and Materials (Exhibit D) and
submits to GSD-C.O.

3.8 Monitors properties and updates inventory records


based on Acknowledgment of Returned Properties, the
Inventory and Inspection Report, and Fixed Assets
Issuance Report.

3.9 Receives report on idle properties and relocates the


same for maximum utilization.
4. Property Inspector
4.1 Inspects and certifies condition of the property returned.
Indicates on the RRP recommended action and signs on
the inspection report portion of the ARP.

4.2 Examines properties listed in the Inventory and


Inspection Report and attests to the manner of disposal of
the properties.
5. Provincial Manager
5.1 Signs on the Noted By portion of the RRP.

5.2 Approves I & I Report if acquisition cost is P500,000 and


below.

5.3 Recommends approval of the I & I Report to the


Regional Manager if acquisition cost is above P500,000.00
to below P1.0 M. Initials the I & I Report.

5.4 Upon receipt of the approved I & I Report, activates


Provincial Disposal Committee to undertake the necessary
disposal procedures.

5.5 Prepares the necessary papers in connection with the


disposal specified in the confirmation/memorandum order
received from the Regional Manager.

5.6 Heads the Provincial Disposal Committee and informs


them of any approval/confirmation of disposal.

5.7 In the case of disposal thru donation, arranges for the


withdrawal/delivery of the items to the agency institution
upon receipt of approval and confirmation. Prepares Memo
to effect withdrawal.

5.8 Coordinates sale thru public bidding/negotiates and


prepares the necessary papers to complete the sale.

5.9 Informs the highest bidder thru a memo of the approval


and acceptance of the bid and arranges full payment.
6. Regional Manager
6.1 Approves the Inventory and Inspection Report if the aggregate
acquisition cost is P 1M and
above.

6.2 Informs the Committee of the approval of the I & I


Report/Mode of disposal.

6.3 Returns all copies of approved I & I Report to the Provincial


Manager. Likewise, returns disapproved I & I Report stating
reason for disapproval.
6.4 Evaluates committee recommendation regarding the mode of
disposal. If approved, prepares a formal memorandum order to
the Disposal Committee thru the Asst. Regional Manager (R.O.)
or the Provincial Manager (P.O.) authorizing the disposal thru the
recommended mode. If disapproved, directs the committee the
mode of disposal to be followed.

6.5 Approves the award of sales and informs the Asst. Regional
Manager (R.O.) or the Provincial Manager/OIC (P.O.) of the
approval (refer to Specifications of Authority in II.4).

6.6 Approves trade-in of old fixed assets for new ones if found to
be advantageous.

6.7 Reviews donation requests. Forwards recommendation for


approval to the Office of the Administrator.

6.8 Approves/disapproves recommendation to destroy


unserviceable properties.
7. Accounting Unit/DAS-General Accounting Division
7.1 Determines the book value. Prepares entry to
record/reclassify the properties based on RRP.

7.2 Write-off assets in the books based on the duly approved I & I
Report/FAIR.
8. Commission on Audit (COA)
8.1 Witness bid proceedings and signs tabulation.

8.2 Witness the disposal of properties.

8.3 Review the new appraisal value set by the Disposal


Committee, in case sale thru public bidding fails.
9. Disposal Committee (C.O. & F.O.) -
9.1 Inspects the unserviceable properties, equipment and
materials for a more accurate determination of appraised value
taking into consideration obsolescence, depreciation, prevailing
resale value, physical actual condition and result of previous
bidding for similar properties. Computation of appraised value is
not limited to DBM or COA guidelines but also on the actual
condition and/or prevailing re-sale value.

9.2 Accepts bids most advantageous to the agency.


9.3 Advertises items to be bidded in accordance with the policy on
bidding.

9.4 Conducts public bidding on an "as is" "where is" basis.

9.5 Receives sealed bids and opens on the specified date and
time and in the presence of the Auditor and participating bidders.
Submitted bids must meet requirement is set.

9.6 Tabulates bids obtained.

9.7 Recommends approval of the award of sale to the highest


bidder, together with the necessary attachments, informs winning
bidder on the award of sale.

9.8 Accomplishes the report of sale portion of the 1 & I Report.

9.9 Distributes copies of the I & I Report after final


disposal/withdrawal of properties.

9.10 In the event sale thru public bidding fails, convenes again to
review appreciation. Sets a new appraisal value and seeks
suggestion of COA.

9.11 Requires buyers to submit price quotation whenever sale


thru public bidding fails and sale thru negotiated sale is resorted
to.

9.12 In case of trade-in, compares trade-value to appraised value


at which the unserviceable/old asset may be disposed of. If
acceptable, coordinates trade-in and prepares necessary
documents. Indicates in the "Remarks" portion of the I & I Report
the mode of disposal which is trade-in.

9.13 Arranges for the withdrawal of the items by the trade-in


dealer.

9.14 Surveys possible government agencies/government


controlled corporations who may wish to barter assets with the
agency. Submits recommendation regarding the barter
agreement.
9.15 If and when the mode of disposal decided upon is donation,
surveys possible agencies/institutions who may be possible
users/recipients of the properties.

9.16 Selects among the possible agencies/institutions considered


as recipient. The committee may allocate the items among the
considered recipients.

9.17 Submits recommendation together with a brief backgrounder


of the beneficiaries to the Regional Manager/GSD Dept. Manager.

9.18 Indicates on the I & I Report the donation and distributes


copies accordingly.

9.20 Undertakes actual burning of unserviceable assets in the


presence of the designated Property Inspector, and Accounting
representative. Indicates on the I & I Report the mode of
destruction and distributes copies accordingly.
All rulings and/or issuances inconsistent herewith are hereby
superseded.

III. RESPONSIBILITIES

IV. FLOW CHART


Top Page
EXHIBITS
Exhibit A - Inventory and Inspection Report of Unserviceable Property
Receipt for Returned Property
Quarterly Report On the Disposal of Unserviceable FA and Materials
Quarterly Report on Disposition of Unserviceable FA and Materials
SOP Library
SOP NO: GS-PD19 (List of Exhibits/Attachments)

Mission: Finance and Administration

Area: General Services (GS)

Activity: Purchasing/Inspection and Fixed Asset Disposition (GS-PD)

Title: Revised SOP on Fixed Assets Inventory, Monitoring and Control System

Date Approved/Issued: 03/24/2003

Date Effective: 03/24/2003

Digest:

I. TERMS OF REFERENCE
A. Rationale
B. Objective
C. Scope
D. Basis

II. IMPLEMENTING GUIDELINES

A. General Policies
1. Upon initial implementation of this SOP the Supply Officers
shall make a complete inventory of NFA fixed assets in their
respective areas and submit the complete and Updated Fixed Assets
Inventory Report (Exhibit 1) to the Regional Office for consolidation
and submission to GSD-PMSD. The Supply Officer concerned shall
update the inventory report indicating the actual location and the
accountable officer of the fixed asset. Henceforth, the Supply
Officer shall submit a Quarterly Consolidated Updated Fixed
Assets Inventory Report to GSD-PMSD to monitor movement of
NFA fixed assets. Submission of the Quarterly Consolidated
Updated Fixed Assets Inventory Report shall be every 15th day
after the end of each quarter.

2. Fixed assets shall be properly valued. The acquisition cost and


other expenditures incurred in connection with the acquisition of
fixed assets shall be capitalized.

3. Expenditures incurred for major repairs amounting to


Php10,000 and above which increase the usefulness and/or
prolong the economic life of a fixed asset shall also be capitalized.

4. The Department for Accounting Services (DAS), General


Services Department, all field accounting units and Administrative
and General Services Units shall strictly adhere to the SOP on
Depreciation Accounting and supplemental guidelines regarding
fixed asset depreciation to maintain an accurate book value of a
fixed asset.

5. Unserviceable Fixed Assets shall be reclassified/treated as


Miscellaneous Asset - Junked Assets. A separate schedule for
Unserviceable Fixed Asset shall also be prepared.

6. Junked Fixed Assets shall be removed from the fixed asset


inventory account after the issuance of the Inventory and
Inspection Report (I & IR).

7. Disposition of unserviceable fixed assets shall be done faithfully


following the provisions of the SOP on the Disposal of
Unserviceable Fixed Assets and Materials (Junk Properties) per
SOP No. GS-PD14 dated May 29, 1997 and made effective June
1, 1997.

8. The Property, Monitoring and Maintenance Section (PMMS),


Property and Supply Management Division (PSMD) of the
General Services Department (GSD) and the Property Units of the
field offices shall be responsible in monitoring all movements of
fixed assets.

9. The Administrative Officer/Supply Officer shall prepare a


Quarterly Report on Junked Properties (Exhibit 2) to be submitted
directly to C.O. - GSD - PMMS five (5) days after end of each
quarter.

10. As much as possible, fixed assets shall remain with the office
where it was originally issued. Transfer of accountability should
therefore be from one employee to another within the same
department/office. Exemption shall be when a whole unit/division
is transferred from one department to another.

11. The heads of offices shall be held primarily responsible for the
management, expending or utilization of the NFAs fixed assets in
accordance with the existing policies and regulations, and
safeguarding against loss or wastage through illegal or improper
disposition.

12. Primary accountability is vested upon the accountable officer


to whom the fixed asset is issued.

B. Specific Policies

1. Classification
1.1 Effective July 7, 1997, only newly purchased or
acquired properties with a value of P10,000 and
above shall be regarded as fixed assets.
Properties classified as fixed assets prior
to July 7, 1997 with a life expectancy of
more than one year and with a value of
P1,500 and above (i.e electric fans,
clerical tables clerical chairs, etc) shall
still be classified as fixed assets.
1.2 Fixed assets shall have three (3) major classifications
a) Land and Land improvements - consist
of land and its improvement which are
more or less permanent and capital in
nature including property rights and
interest ;
b) Building and Structures - consist of
building and structures which are more or
less permanent and capital in nature ; and
c) Furniture, fixtures, equipment work
animals and books with a value of
P10,000 and above, more or less capital
in nature, and which when used do not
suffer any material or substantial change
or alteration in size or form shall be
classified as fixed assets.
1.3 To ensure uniform classification and treatment,
only items listed in Annex A shall be considered as
fixed assets.
1.4 Items not included in the list must be referred to
GSD PMMS for proper coding and classification.

2. Valuation
2.1 The acquisition cost of fixed assets with the
following modes of procurement shall be determined
as follows:

2.1.1 Outright purchase - net price paid for the item ;


2.1.2 Exchange for another fixed asset -
fair market value of the asset received
and the difference, if any, shall be
charged to miscellaneous income or loss ;
2.1.3 Trade-in for another fixed asset -
fair market value of the asset traded-in
plus additional cash paid.
2.1.4 Grants and Donations Received -
fair market value of the asset received or
the value as stated in the Deed of
Donation. Foreign grants and donations
shall be recorded at their peso value
using the conversion rate on the date of
receipt.
2.1.5 GSD-OBMD shall furnish the
Department for Accounting Services
(DAS) with a copy of fixed asset major
repairs amounting to P10,000 and above.
2.2 Expenditures incurred in connection with the
acquisition of fixed assets shall be capitalized to form
part of its cost as follows :

2.2.1 Land

a) Cost of demolition, cleaning and/or grading ;


b) Relocation or
reconstruction of property
belonging to others in order to
acquire possession ; and
c) Other costs directly
attributable to its acquisition
and to conditioning the land
for use.
2.2.2 Buildings
a) Expenditures for service
equipment and fixtures made
a permanent part of the
structure ; and
b) Payment for building
permits, direct cost of
construction and overhead
directly applicable to
construction if the building is
constructed by administration
or the total amount paid to the
builder if the construction was
awarded to a contractor.

2.2.3 Machinery and Equipment


a) Cost of installation, freight
and insurance costs borne by
NFA to bring the property to
its site of use, and
b) Materials and other costs
incurred directly and
attributable to placing the
equipment ready for use.
c) For equipment -in-
*
process - the basis for
capitalization shall be the
terminal report. At the end of
each project the concerned
department should make a
terminal report summarizing
all expenses incurred for
purposes of
recording/capitalizing
expenses.
* Equipment-in-process -
equipment undergoing major
repair works.
2.3 Cost incurred after acquisition to prolong the life
and/or improve the productivity/efficiency of a fixed
asset shall be capitalized provided ;
2.3.1 The total amount spent is P10,000
and above and extends the life of the
asset.
2.3.2 The Technical Inspection Unit (TIU),
IAS/Supply Officer (Field Office) shall
make the recommendation in the work
order/job order for capitalizable
expenditures.

2.4 Cash outlay incurred which do not satisfy the


above conditions shall be treated as operating
expenses and shall not affect the cost of the fixed
asset.

2.5 Appraisal teams shall be created to facilitate the


valuation of fixed assets with unestablished values.
The teams shall be composed of the following :

a) Central Office
Team Leader : Department Manager, GSD
Members : TSD
Representative
TRDD Representative
Chief, PSMD, GSD
Chief, Gen. Accounting, DAS
Chief, TIU, IAS
Observer : COA Representative

b) Regional Office
Team Leader : Asst. Regional Manager
Member : Regional Administrative Officer
Regional Engineer
Regional SQAO
Regional Accountant
Observer : COA Representative

c) Provincial Office
Team Leader : Provincial Manager
Member : Provincial Administrative Officer
Sr. MPO/Plant Engineer
Provincial SQAO
Provincial Accountant
Observer : COA Representative

3. Documentation
All fixed asset transactions shall be properly
documented as follows (Please refer to
Annex B for the documentation summary):

3.1 Acquisitions
3.1.1 Land and Buildings shall be
documented by a Transfer of Certificate
Title (TCT)/Original Certificate Title
(OCT)/building plans, and declaration of
real property. The Original copies of the
TCT/OCT shall be endorsed to the Cash
Division, Department for Treasury Budget
and Fund Management (DTBFM) for
safekeeping and the Original copies of
the building plans shall be kept by the
Technical Services Department (TSD) .
The PMMS/Property Unit of the
concerned Field Office shall be furnished
copies of the aforementioned documents.
3.1.2 Receipts of newly purchased fixed
assets other than land and buildings and
their subsequent issuance shall be
documented with a Fixed Asset Receiving
Report (FARR-Exhibit 3) and a Fixed
Asset Issuance Report (FAIR-Exhibit 4)
respectively to be accomplished by the
Department for General Services -
Property and Supply Management
Division (GSD-PSMD) - except in cases
enumerated herein:
Case A: Fixed Assets Purchased by C.O.,
delivered in C.O.
(examples are: computers, fogging machines,
moisture meters, etc.)
A.1 For Computers
Purchased by C.O.
delivered to MSD
a)
Upon
recei
pt of
the
newly
purch
ased
comp
uters,
the
Mana
geme
nt
Servi
ces
Depa
rtmen
t
(MSD
)
shall
prepa
re the
FAR
R
which
shall
be
signe
d by
the
Chief,
MSD-
MISD
on
the
Not
ed
by
portio
n of
the
docu
ment.
The
Rec
eived
by
portio
n of
the
FAR
R
shall
be
signe
d by
the
desig
nated
suppl
y
office
r in
MSD.
b)
Befor
e
deplo
ymen
t,
MSD
shall
prepa
re a
Deplo
ymen
t/Distr
ibutio
n List
(Exhi
bit 5)
indica
ting
Serial
Num
ber,
locati
on
wher
e the
comp
uter
will
be
deplo
yed
and
FAIR/
MR
numb
er.
MSD
shall
provi
de
the
GSD-
PMS
DS
with a
copy
of the
Deplo
ymen
t/Distr
ibutio
n List
for
prope
rty
codin
g.
After
the
newly
purch
ased
equip
ment
have
been
code
d the
Deplo
ymen
t List
will
be
sent
back
to
MSD
for
the
prepa
ration
of
FAIR
(if the
equip
ment
will
be
issue
d to
field
office
s) or
MR (if
the
equip
ment
will
be
issue
d to
C.O).
c)
After
deplo
ymen
t the
desig
nated
suppl
y
office
r in
MSD
shall
provi
de
DAS
a
copy
of
FAIR
for
the
prepa
ration
of
Advic
e.
A.2 For fogging machines/moisture meters
and other
equipment purchased by C.O. delivered to TRDD
a)
Upon
recei
pt of
the
newly
purch
ased
fixed
asset
s the
Tech
nical
Reso
urce
Devel
opme
nt
Depa
rtmen
t
(TRD
D)
shall
prepa
re the
FAR
R
which
shall
be
signe
d by
the
Chief,
GSD-
PSM
D on
the
Not
ed
by
portio
n of
the
docu
ment.
The
Rec
eived
by
portio
n of
the
FAR
R
shall
be
signe
d by
the
conc
erned
Divisi
on
Chief
of
TRD
D.
b)
Befor
e
deplo
ymen
t,
TRD
D
shall
prepa
re a
Distri
butio
n List
(follo
w
forma
t on
Exhib
it 5)
indica
ting
the
serial
numb
er of
units
and
the
locati
on
wher
e the
units
will
be
deplo
yed.
TRD
D
shall
provi
de
the
GSD-
PMS
DS
with a
copy
of the
Distri
butio
n List
for
the
prepa
ration
of
FAIR.
After
deplo
ymen
t the
GSD-
PMS
DS
shall
provi
de
DAS
a
copy
of
FAIR.
c) To
docu
ment
prope
rties
to be
transf
erred,
GSD-
PSM
D
shall
prepa
re the
FAIR
signe
d by
its
Chief
on
the
Appr
oved
by
portio
n.
GSD-
PMM
S
shall
indica
te the
prope
rty
code
of the
equip
ment
in the
FAIR
and
the
distri
butio
n list
prepa
red
by
TRD
D.
Case B: Purchased by C.O.,
directly delivered to F.O.
(example:
generator sets, mechanical
driers, packaging machines
purchased by the Technical Services Department
(TSD)
a) Whenever
there is a
delivered
equipment in
the field
office the
concerned
Supply
Officer shall
immediately
furnish the
GSD-
PMSDS, the
DAS. the
F.O.
Accounting
unit and the
local TSD
personnel
with a
photocopy of
the delivery
receipt (DR)
for
information
purposes.
b) The local
TSD
Personnel of
the
concerned
NFA
Provincial
Office shall,
immediately
upon the
acceptance
of the
equipment/m
achinery(ies)
, (supported
by
satisfactory
performance
test), submit
to TSD
Central
Office a
Certificate of
Acceptance,
copy
furnished
DAS and
GSD-
PMSDS.
c) On the
basis of the
Certificate of
Acceptance,
the
concerned
local Supply
Officer shall
document
the
acceptance
of the
equipment/m
achinery(ies)
by
accomplishin
g the
required
FARR.
He/She shall
sign on the
Received
by portion of
the FARR
while the
Chief of
GSD-PSMD
shall sign on
the Noted
by portion
of the
document.
d) The
concerned
local TSD
Technical
Personnel
shall see to it
that the local
Supply
Officer is
always
furnished
with a copy
of Certificate
of
Acceptance
to inform
him/her of
any
equipment/m
achinery(ies)
that are
being
formally
accepted by
NFA, as
basis for the
preparation
of FARR.
e) To
document
equipment
issued to the
field offices
GSD-
PMSDS shall
prepare the
FAIR based
on the
Acceptance
Report and
FARR signed
by the Chief,
GSD-PSMD.
Note: Where the responsibility to
deploy/distribute computers, fogging machines
and other equipment is given to the Regional
Office, the Deployment/Distribution List must be
strictly followed by the issuing Supply Officer in
the regional office. Any deviation in the
Deployment/Distribution list is considered a
violation of this SOP and shall subject them to
administrative sanctions as defined in the last
paragraph of Item III.E. of the SOP.
.
3.1.3 The purchase of fixed assets shall
be governed by the SOP on Central
Office/Field Office Purchasing System.
3.1.4 All fixed asset acquisition and
receipts whether from purchase (local and
importation), fabrication, transfers and
donation shall be properly documented as
prescribed in this SOP and all
documentation shall be coordinated with
PSMD, GSD/Property Units of Field
Offices.
3.1.5 The receiving office shall refer to
Annex B for the documentation
procedure.

3.2 Issues to Employees


3.2.1 Issues of fixed assets to employees
shall be documented by a Memorandum
Receipt (MR-Exhibit 6).
3.2.2 MRs for newly purchased fixed
assets issued by the GSD-PMSDS
including
computers/equipment/machineries issued
by MSD/TRDD/ TSD repespectively shall
be signed by the Department Manager of
General Services Department (DM,
GSD).
3.2.3 MRs for property in the custody of
an official or employee shall be renewed
by the concerned Administrative Assistant
every two (2) years during physical
inventory taking, signed by the
Department Manager concerned, copy
furnished GSD-PMMS. MRs involving
transfers of properties to other
departments shall be approved by the
GSD-PMMS. PMMS shall furnish DAS-
GAD a copy of the MR.

3.3 Transfer of Fixed Assets from C.O. to F.O. or from One F.O. to Another
3.3.1 Transfer of fixed assets from
Central Office (C.O.) to field offices (F.O.)
and vice-versa or from one field office to
another shall require the preparation of
the Fixed Asset Issuance Report (FAIR-
Exhibit 4) by the issuing Supply Officer
and the Fixed Asset Receiving Report
(FARR-Exhibit 3) by the receiving Supply
Officer.
3.3.2 Transfer of fixed assets from F.O. to
C.O. or from one F.O. to another for
purposes of repair shall be acknowledged
in the Work Order (WO) and the Job
Order (JO) respectively by the employee
who will repair the equipment. FARR shall
only be prepared by GSD if the
equipment will not be returned but will be
permanently junked.
3.3.3 GSD-PSMD/PMSDS shall issue and
accomplish the FAIR and FARR
accountable forms whenever fixed assets
are transferred from the C.O. to the field
offices and vice versa. The Department
for Accounting Services (DAS) shall be
immediately furnished their respective
copies of accomplished FAIR/FARR.

3.4 Transfer within the same Office/Department


3.4.1 Transfer of property accountability
from one employee to another within the
same department/office shall be
documented by preparing a new MR for
the receiving employee and canceling the
MR of the employee issuing the property.
The new MR shall be signed by the
Department Manager concerned.
3.4.2 A copy of the MR shall be given to
GSD-PMMS as basis for clearing the
issuing employee of his accountability
and for updating GSD records.

3.5 Return of Fixed Assets to the Supply Officer


GSD-PMSDS shall prepare a Receipt for
Returned Property (RRP-Exhibit 7/
Exhibit 7.1) for a fixed asset surrendered
and returned by an accountable officer cc:
PMMS/Supply Officer who will cancel the
MR.
Fixed Assets for transfer to field offices
shall first be surrendered to GSD-PMSDS
which shall be responsible for transferring
the FA to field office.

3.6 Issues/Receipts to/from Repairs/Fabrication


3.6.1 Requests for fabrication of a
furniture or fixture must be supported by a
Work Order (WO), if work is to be done by
NFA or a Job Order (JO), if a private
contractor has been commissioned to do
the job.
3.6.2 Receipt of fabricated furniture or
fixture done in-house and by private
contractors shall be acknowledged in the
WO and the JO respectively, by the
receiving party.
3.6.3 The GSD-PMMS in coordination
with GSD-AFSD shall determine the cost
of the fabricated furniture or fixture. An
MR shall then be prepared as soon as the
fabricated property has been finished and
issued.
3.6.4 All fabrications shall, likewise be
subject to pre-repair and/or post repair
inspection by TIU, IAS/designated
Property Inspector (field office).
3.6.5 The SOP on
Repair/Maintenance/Fabrication of
Central Office Furniture, Equipment and
Facilities (SOP NO. GS-PD09) effective
October 6, 1987 and its
amendments/addenda issued thereto
covers the details on repairs and
fabrication of fixed assets.

3.7 Disposal of Unserviceable Fixed Assets


3.7.1 Unserviceable fixed assets shall be
immediately surrendered to the Supply
Officer by the concerned accountable
employee/user and shall be covered by a
Receipt of Returned Property (RRP).
Same shall be immediately reported to
DAS/Accounting Section by the Supply
Officer.
3.7.2 Disposal of junked property shall
always be covered by an Inventory and
Inspection Report (I & IR) copy furnished
GSD-PMMS and DAS/Accounting Unit
(F.O.).
3.7.3 Properties surrendered to the
Supply Officer which are already
approved for disposition shall remain to
be the accountability of the Supply Officer
until such assets are physically disposed
and written-off in the books of accounts.
3.7.4 The write-off in the records shall be
documented by FAIR. The FAIR shall be
prepared upon physical disposition of the
fixed asset with the corresponding I & I
Report. DAS/Accounting Units shall be
provided with a copy of FAIR and I & I
Report as basis for recording in the books
of accounts.
3.7.5 The Revised SOP on Disposal of
Unserviceable Fixed Assets and Materials
(Junk Properties) (SOP No. GS-PD14) issued
on May 29, 1997 and made effective June 1,
1997 and its amendments/addends issued
thereto discusses the details on disposition of
fixed assets.

3.8 Lost Asset


3.8.1 The employee accountable for a lost
fixed asset shall file, within thirty (30)
days from date of loss, a Request for
Relief of Property Accountability which
shall be submitted to the Commission on
Audit (COA) with the available supporting
evidence such as Affidavit of Loss, Joint
Affidavit of two disinterested persons,
Memorandum Receipt and a Police
Investigation Report if lost outside the
office. However, if lost within the office,
the Investigation Report of the Provincial
Investigators/IPD-IAS shall suffice.
The Request for Relief of
Property Accountability of
employees accountable for
lost fixed asset in the field
offices shall be submitted
directly to the field office COA
Auditors.
3.8.2 The concerned employee shall only
be cleared of his accountability upon the
issuance by the Corporate Auditor of a
Relief of Accountability through GSD
which is only issued if the circumstances
surrounding the loss is beyond the control
of the said employee.
The GSD-PMMS shall furnish
DAS with a copy of the Relief
of Accountability as basis for
writing-off from the books and
shall give the accountable
officer his/her personal copy
of the adjusting Journal
Voucher.
If the accountable officer is
relieved from accountability,
the PMMS shall cancel the
corresponding MR and it shall
attach to it a photocopy of the
Relief from Accountability
issued by COA.
4. Accountability and Responsibility
4.1 For Central Office, newly acquired assets shall be
the responsibility of the GSD, Department Manager
and shall be the accountability of the Chief of PMSDS
until MRs are issued to an accountable officer or
employee.
For cases discussed in Item 3.1.2, fixed
assets shall be the responsibility of the
Department Manager concerned (MSD,
TRDD and TSD) until FAIR has been
issued based on the Distribution List,
Acceptance Report and/or FARR
submitted by the MSD, TRDD and TSD to
GSD-PMMS.
4.2 For field offices, the Supply Officer shall be
directly responsible for receiving and establishing
custodianship of each asset. As such, assets received
by the office with no existing MRs shall be the Supply
Officers accountability.
4.3 The employee shall be held primarily accountable
and secondarily responsible for all properties issued
to him as specified in the MR.
4.4 The Head of Office (for Provincial and Regional
Offices, Central Office department/offices) shall
exercise the diligence of a good father of a family in
supervising accountable officers under his control to
prevent the incurrence of loss.
4.5 Every officer accountable for NFA fixed assets
shall be liable for the improper or unauthorized use or
misapplication thereof, by himself or any person for
whose acts he may be responsible. He shall likewise,
be liable for all losses, damages, or deterioration due
to negligence in the keeping or use of the property,
whether or not it was in his custody during the time of
loss or damage.
4.6 In case of loss due to the fault of the accountable
officer, he/she shall restitute the lost asset or made to
pay the corresponding replacement cost based on the
provisions of SOP No. FS-GP18 entitled SOP on the
Application of Replacement Cost issued and made
effective December 7, 2000.
If the accountable officer opts to pay the
replacement cost he/she shall secure an
Authority to Accept Payment (AAP) from
the PSMD to document purpose of
payment. The Chief of the PMMS shall
affix his/her initials in the AAP prior to the
approval of the Chief of PSMD. After
payment and receipt of two copies of the
OR, the accountable officer shall give one
copy of the OR to PMMS which shall be
the latters basis in cancelling the MR.
5. Physical Inventory
5.1 Physical Inventory of fixed assets shall be
conducted annually to establish balances as of July
31, of each year.
5.1.1 The physical counting shall be
conducted within August 1-15 for Central
Office and within August 1-18 for field
office.
5.1.2 The Inventory Report shall be
prepared and certified correct by the
committee in charge thereof, witnessed
by the auditor and approved by the head
of office.
5.2 The Inventory Report shall immediately be
reconciled with accounting and inventory records as
of July 31.
5.3 Regional/Provincial office inventory reports shall
be submitted to the Central Office Inventory
Committee on or before September 15. Central Office
inventory reports shall be due every September 30.
National Inventory reports shall be due every
November 30.
Failure to submit the reports on specified
deadline shall be considered as neglect in
the performance of duty and the
concerned personnel shall be
administratively charged pursuant to CSC
rules on administrative cases.

5.3.1 Copy distribution of the report shall be as follows :


Copy 1 - PSMD/PMMS-GSD for editing
and consolidation
prior to submission to COA
2 - Accounting Unit
3 - Local COA Unit
4 - Department/Office file

5.4 The Inventory Committees shall be organized as follows :

5.4.1 National Inventory Control Committee


Chairman : Asst. Adm. for Administration
Members : GSD, Asst. Dept. Manager
IAS, Asst Dept. Manager
DAS, Asst. Dept. Manager
TSD, Asst. Dept. Manager
TRDD, Asst. Dept. Manager
Observer : COA
The National Inventory
Control Committee (NICC)
shall be responsible for
providing directions on
inventory taking and shall
monitor the activities of all
inventory committees. The
same committee shall be
responsible for the rendering
of the consolidated inventory
report to COA.

5.4.2 Central Office Inventory Committee


Chairman : Chief, PSMD, GSD
Members : Chief, GAD, DAS
Chief, TIU, IAS
Chief, PMMS, PSMD, GSD
Administrative Assistant, Dept. concerned
Observer : COA Representative

The Central Office Inventory Committee


shall be responsible for the fixed asset
inventory taking in the Central Office and
in the consolidation and submission of the
inventory report to the NICC.
5.4.3 Regional Office Inventory Committee
Chairman : Asst. Regional Manager
Members : Regional Accountant
Regional Engineer
Regional Adm. Officer
Observer : COA Representative
The Regional Office Inventory
Committee shall be
responsible for the physical
inventory taking of the fixed
assets in the regional office
and in the preparation and
submission of inventory
report to the NICC.
5.4.4 Provincial Office Inventory Committee
Chairman : Provincial Manager
Members : Provincial Adm. Officer
Supply Officer
Plant Engineer/Sr. MPO
Provincial Accountant
Observer : COA Representative
The Provincial Office
Inventory Committee shall be
responsible for the physical
inventory taking of the fixed
assets in the provincial office
and in the preparation and
submission of inventory
report to the NICC.
5.5 Members of inventory teams conducting the count
and reconciliation shall be relieved from their office
functions to expedite the completion of this
undertaking.
5.6 All fixed assets regardless of location shall be covered by the count.
5.7 Presentation in the inventory report shall be based
on fixed asset grouping/classification.
5.8 The inventory report on fixed assets shall be used
to support the adjusted book balance of the fixed
asset accounts and monitor employee
accountabilities.
5.9 Inventory teams must see to it that fixed assets are properly documented
by an MR.
5.10 Accessories to fixed assets shall be considered
part of the asset but shall have a separate property
code as discussed in Section II.B.6.
5.11 The GSD-PSMD thru the GSD-PMMS shall
coordinate with the respective Administrative
Assistants regarding accountabilities of the
employees in their departments including
maintenance of complete file of MRs.
5.12 Transhipments/purchases are temporarily suspended for the duration of
the count.
5.13 Inventory Teams shall exert maximum effort to locate each missing item.
5.14 Verification shall be done for items included in
the books and missing during the count. Such items
must first be referred to the NICC before they are
dropped from the books.
5.15 Construction in progress must be accounted for
in terms of percentage of payment made by NFA and
percentage of completion.
5.16 Inventory per count must be reconciled per book of accounts.
5.17 Adjustments must be made in the books for
items still unreflected/unrecorded but existing per
count.
5.18 Missing assets which cannot be located after
exhaustive search must be properly noted as missing
in the remarks column of the Inventory Report Sheet
(IRS).
5.19 After the inventory count, GSD-PMMS shall
update the employees of their accountabilities.

6. Property Identification and Coding


6.1 Property Identification and Coding shall be
centralized with GSD-PMMS. Field offices shall
coordinate with GSD-PMMS for identification and
coding of locally purchased properties. Property code
shall be perpetual regardless of fixed asset location.
6.2 All fixed assets acquired from purchase,
fabrication, transfer and donation, shall be assigned a
property code to be painted on a conspicuous part of
the asset by the GSD-PMMS/Supply Officer.
6.3 The property code of fixed assets
transferred/disposed/donated shall be properly noted
accordingly in the property records/books.
6.4 Fixed asset code numbers shall be alpha-numeric
and shall follow the format in Annex C.
6.5 Assignment of property codes shall be
independent from one department/office to another.

Property coding per type of asset shall be chronological.


Property codes assigned by GSD-
C.O. to an asset shall be permanent
and should not be changed even when
transferred.
Illustration:
C.O.-TSD purchased four
units (4) of Packaging
Machines. Batangas and
Cabanatuan got two (2) units
each of the equipment. The
equipment should be coded
as follows :

Batangas Shipment:

Packaging Machine No. 1 : 01-NFA-401-WE-


H001
Packaging Machine No. 2: 01-NFA-401-WE-
H002

Cabanatuan Shipment:

Packaging Machine No. 3: 01-NFA-301-WE-


H001
Packaging Machine No. 4: 01-NFA-301-WE-
H002
6.6 Numeric elements shall be printed in Arabic form
while alpha elements shall be in bold print similar to
the upper case letters in the English alphabet.
6.7 Painting of property codes shall be done in the following locations:

6.7.1 Furniture and Fixtures


a) Tables - Right hand edge of the table top facing the user
b) Chairs - Back portion of the backrest of the chair

6.7.2 Office Equipment


Back portion of the equipment
except for filing cabinets
which must be coded in front
at the upper right hand
corner.
6.7.3 Motor Vehicles
At the rear bumper for those
with security plates (codes to
be painted on the inside
surface of the compartment
hood).
Illustration:
_________________________________
__________
:84-NFA-GSD LT-A001
_________________________________
___________
REAR BUMPER
6.7.4 Post-Harvest Facilities

a) Machineries - Outside surface of the engines housing/block


b) Equipment - part of the equipment that is not detachable

6.7.5 Communication/Audio Visual Equipment - Back portion of the equipment


6.7.6 Firearms

Bottom portion of the equipment


If bottom is corrugated, on the side of the handle

6.8 Lands and Buildings shall be exempted from the coding system.
6.9 If properties are for repainting/re-
varnishing/reupholstery/repair the Property
Custodian/Supply Officer/carpentry personnel shall
see to it that property codes are repainted on the
same assets and on the same location.
6.10 The inventory team should consult the personnel
handling properties with sensitive parts so as not to
cause damage to said properties while the code is
being painted.

7. Monitoring
7.1 The GSD-PMMS and the field office property unit
shall maintain an efficient monitoring system for fixed
assets. The GSD-PMMS and the Property Units in the
Provincial Offices shall serve as the data bank of
property information and as such shall bear the
following responsibilities:

7.1.1 Monitoring of fixed asset movement, status, number and cost ;


7.1.2 Tracking of repair and maintenance
activities conducted on each fixed asset
except for vehicles and air conditioners in
the Central Office which is the
responsibility of the GSD-Office Facility
Maintenance Section (OFMS).
7.1.3 Providing Management with timely,
relevant and accurate information/reports
concerning the agencys fixed assets;
7.1.4 Providing the Insurance, Billing and
Collection Division (DAS-IBCD) with an
accurate listing of properties acquired to
facilitate insurance of the fixed assets.
7.1.5 Assisting DAS/Accounting Section with collection of cost data on the
agencys fixed assets.
7.2 The following records shall be prepared and
updated by the General Services Department (GSD)
in order to maintain an efficient data bank:
7.2.1 History Card - shall be prepared for
each fixed asset to record its historical
cost, specifications and other relevant
data pertaining to the fixed asset such as
cost of repairs and maintenance including
details on parts and materials used, labor
and other overhead. There shall be four
(4) types of history cards and the type to
be prepared shall depend on the general
classification on which the fixed asset
falls :
a) Equipment History Card (Exhibit 8)
All items falling under account
codes 79-811, 79-812 and 79-821.
b) Vehicle History Card (Exhibit 9)
All items
belonging to
account codes
79-813, 79-814.2,
79-815, 79-816,
79-817, 79-818,
79-819, 79-820,
79-822, 79-823,
and 79-824.
c) Machinery History Card (Exhibit 10)
All items covered by account codes
79-814.1, 79-814.3 and 79-814.5
d) Land/Building History Card (Exhibit 11).
7.3 Other provisions regarding movements of fixed
asset not covered herein, shall be properly reported to
GSD-PMMS for updating (Ex. Lost assets, retired,
destroyed by fire).
7.4 The following personnel/offices shall assist the
GSD-PMMS in the development/maintenance of the
data bank to ensure its efficiency by accomplishing
the tasks specified as follows :

7.4.1 Property Custodian/Supply Officer (Field Office)


a) Preparation of a report on
Capital Expenditures (Exhibit
12) to be submitted to the
GSD-AFSD cc: GSD-PMMS
at the end of each quarter.
b) Maintenance of fixed asset
history cards and ledger
cards similar to those being
maintained by GSD-PMMS;
and
c) Reporting of fixed asset
condition, acquisition and
issuance by submitting the
Fixed Asset Transaction
Report Exhibit 13) quarterly to
GSD-PMMS with the
accountable forms attached.

7.4.2 Chief, Office Facility Maintenance Section (OFMS,GSD)


a) Monthly reporting of fixed
asset fabrication, capital
expenditure, and repair and
maintenance using the
prescribed form in Exhibit 14.

b) Supervision of painting of
property codes on all
fabricated properties which
must be coordinated with
PMMS.
8. Accounting Treatment

Pro-forma Journal entries are contained in Exhibit 15.

III. RESPONSIBILITIES

A. Receipt of Fixed Asset from Supplier

1. Central Office

1.1 Property and Material Storage and Disposition Section (PSMD-PMSDS)

a) Acknowledges receipt of FA in the DR of Supplier


b) Requests inspection of deliveries
c) Prepares FARR and retains FARR copy 2 (Pink copy)
d) Forwards FARR copy 1 (white copy) to Issuing Party (MSD-
computers/TRDD-equipment & machineries/GSD), Copy 3 (blue copy) to
GSD-PMMS and Copy 4 to DAS (yellow).
1.2 Division Chief - Property and Supply Management Division (PSMD)
Signs on FARR
1.3 PSMD-Purchasing Section
a) Prepares voucher with FARR copy -
and other supporting documents
attached.
b) Prepares voucher/PO/LO/JO pertaining
to the acquisition of spare parts/repair of
equipment copy furnished GSD-PMMS.
c) Routes voucher to DAS - Claims and Processing Division for processing.

1.4 PSMD-Property Monitoring and Maintenance Section (PMMS)


Updates Fixed Asset Inventory Report,
Ledger card and history card of
equipment, machinery and vehicle based
on FARR.

2. Field Office

2.1 Supply Officer

a) Acknowledges receipt of FA in the DR of supplier


b) Prepares FARR and secures signature of PM/OIC on FARR copies.
c) Forwards FARR Copy 4 to Accounting Section.
d) Prepares voucher and forwards same
to Accounting Section with FARR copy -
and other supporting documents
attached.
e) Updates Fixed Asset Inventory Report,
ledger card and history card of
equipment, machinery and vehicle based
on FARR Copy 3/PO/LO/JO.
f) At the end of the quarter, prepares and
sends Fixed Asset Transaction Report to
GSD-PMMS with supporting documents.

2.2 Provincial Manager/OIC


Signs on FARR and returns same to Supply Officer
B. Fixed Asset Issuance to Employee by the Supply Officer

1. PMSDS (C.O.)

a) Prepares MR.
b) Signs on the issued by portion of the MR.
c) Secures signature of accountable officer
d) Distributes MR copies accordingly ( Copy 1 to
PMMS, copy 2 to PMSDS, copy 3 to Accountable
Officer and copy 4 to the Administrative Asst.)
2. Supply Officer (F.O.)
a) Prepares MR.
b) Signs on the issued by portion of the MR.
c) Secures signature of accountable officer
d) Distributes MR copies accordingly ( Copy 1 to
Supply Officer, copy 2 to Accountable Officer, copy 3
to Accounting Section and copy 4 file)
3. Chief, PSMD/Provincial Manager
Approves MR.

C. Transfer of FA from C.O. to F.O. or from One F.O. to Another

1. PMSDS (C.O.)
a) Prepares FAIR and secures approval of head of office.
b) Issues the fixed asset with FAIR Copy.
c) Distributes FAIR copies accordingly. Copy 1 to
Issuing Party (white copy), Copy 2 (pink copy) to
PMSDS Copy 3 (blue copy) to GSD-PMMS and Copy
4 to DAS (yellow).
d) Updates Fixed Asset Inventory Report, ledger card
and history card of equipment, machinery and
vehicles based on FAIR.

2. Issuing Supply Officer (F.O.)


a) Prepares FAIR and secures approval of head of office.
b) Issues the fixed asset with FAIR Copy.
c) Distributes FAIR copies accordingly. Copy 1 to
Issuing Party (white copy), Copy 2 (pink copy) to
PMSDS Copy 3 (blue copy) to GSD-PMMS and Copy
4 to DAS (yellow).
d) Updates Fixed Asset Inventory Report, ledger card
and history card of equipment, machinery and
vehicles based on FAIR.
3. PSMDS (C.O.)
a) Receives fixed asset.
b) Prepares FARR and distributes FARR Copies
(copy 1 to Issuing Party (white copy), Copy 2 (pink
copy) to PMSDS, Copy 3 (blue copy) to GSD-PMMS
and Copy 4 to DAS (yellow).
c) Updates Fixed Asset Inventory Report, ledger card
and history card of equipment, machinery and vehicle
based on FARR.

4. Receiving Supply Officer (F.O.)


a) Receives fixed asset.
b) Prepares FARR and distributes FARR Copies
(copy 1 to Issuing Party (white copy), Copy 2 (pink
copy) to PMSDS, Copy 3 (blue copy) to GSD-PMMS
and Copy 4 to DAS (yellow).
c) Updates Fixed Asset Inventory Report, ledger card
and history card of equipment, machinery and vehicle
based on FARR.

D. Transfer of Fixed Asset within the same Office

Central Office

1. Employee (Issuing)
a) Informs the Administrative Assistant of the FA
transfer and requests for the preparation of new MR
for the receiving employee.
b) Signs on the Issued by portion of the MR

2. Administrative Assistant
a) Prepares new MR and secures signature of both
the issuing and receiving employees.
b) Forwards new MR to the Head of Office/Department for approval.
c) Forwards approved MR to Chief, GSD-PMMS for cancellation of the old
MR.
d) Furnishes issuing employee a copy of the new MR and cancelled MR.

Field Office

1. Employee (Issuing)
a) Informs the Supply Officer of the FA transfer and
requests for the preparation of new MR for the
receiving employee.
b) Signs on the Issued by portion of the MR

2. Supply Officer
a) Prepares new MR and secures signature of both
the issuing and receiving employees.
b) Forwards new MR to the Head of Office for approval.
c) Cancels new MR and furnishes issuing employee a
copy of the new MR and cancelled MR.
E. Return of FA to the Supply Officer by Accountable Employee

Central Office

1. Accountable Employee
Verifies property with GSD-PMMS.
2. GSD-PMSDS
a) Prepares RRP
b) Requests for inspection by IAS and receives fixed asset
c) Forwards copy of RRP to GSD-PMMS

3. GSD-PMMS
a) Cancels corresponding MR based on RRP.
b) Updates Fixed Asset Inventory Report, ledger card
and history card of equipment, machinery and vehicle
based on RRP.
Instructions on how to fill up fixed assets documents are presented in Annex
D.

Officials/employees shall strictly follow the documentation procedures of fixed


asset movements. Negligence in the documentation shall be considered a
violation of this SOP and shall in accordance with PD807 and RA 6713,
subject them to the administrative offense of violation of Reasonable Office
Rules and Regulations and shall upon conviction suffer the penalty of
Reprimand, suspension or Dismissal as the case maybe.

All ruling and/or issuances inconsistent herewith are hereby superseded.


III. RESPONSIBILITIES

IV. FLOW CHART


Top Page
EXHIBITS
No Exhibit/s Available for this SOP
SOP Library
SOP NO: FS-BC01 (List of Exhibits/Attachments)

Mission: Finance and Administration

Area: Financial Services (FS)

Activity: Budget and Control (FS-BC)

Title: The Use of Repair and Maintenance Budget for Buildings, Offices and
Warehouses

Date Approved/Issued: 07/06/1984

Date Effective: 09/01/1984

Digest:

I. TERMS OF REFERENCE
A. Rationale
B. Objective
C. Scope
D. Basis

II. IMPLEMENTING GUIDELINES

1. Budget remittance per region/province


Based on the existing Budget System, a monthly budget
remittance by Central Office for repair and maintenance (under
Operating Expense) is effected to the Regional Offices. To ensure
available funds for repair/maintenance of buildings, offices and
warehouses, the following shall be followed:

1.1 The Regional Office shall withhold its budget for repair and
maintenance of buildings, offices and warehouses upon
remittance by the Central Office. Amount shall be based on the
detailed Regional budget.

1.2 Remittance (bank-to-bank) to province shall be effected only


as per approved request for repair/maintenance works.
2. Identification of allowable repair
2.1 The budget for repair/maintenance shall apply only to repairs
which are charged to operating expense under the LCE fund
account.

2.2 New construction/renovation shall not be funded by the


maintenance fund. In such case, it shall have a separate funding.
3. Request for repair
3.1 The Provincial Engineer/Plant Engineer/Warehouse
Supervisor/Administrative Officer thru the Provincial Manager
shall notify the Regional Director of any repair/maintenance works
in the province including its estimated cost.

3.2 The Regional Engineer upon instruction of the Regional


Director shall evaluate the extent of damage and scope of
repair/maintenance work.

3.3 Request for repair/maintenance shall be approved by the


Regional Director as per endorsement by the Regional Engineer.

3.4 Upon approval by the Regional Director, fund shall


immediately be effected to the requesting province.
4. The project shall generally be undertaken by Administration under the
supervision of the concerned Provincial/Regional personnel, hiring rates
for skilled/unskilled workers shall be based on the prevailing rate in the
locality.
If such cannot be undertaken by Administration, sealed bidding
shall be conducted following SOP on Public Bidding and SOP on
Infrastructure Development provided that:

4.1 Project cost is above P30,00.00


4.2 Project cost below P30,000 shall be negotiated with local
contractors following aforementioned SOPs.
5. An INF Engineer shall be called upon to supervise projects which
may require highly technical (i.e. structural and electrical) know-how.

6. The Provincial Manager/Regional Director shall be responsible for all


repair/maintenance works within his jurisdiction.

7. Reports on remittance and expenditures shall still follow the existing


reporting system. Likewise, purchase of materials/hiring of job
order/payment to contractors shall be subject to the usual accounting
and auditing rules and regulations.
8. Accounting Treatment

8.1 Fund Remittance (Central Office to Regional Office)

Central Office

DR: BOCA xxx


CR: Cash xxx

Regional Office

DR: Cash xxx


CR: COCA xxx

8.2 Fund Remittance (Regional Office to Provincial Office)

Regional Office

DR: POA xxx


CR: Cash xxx

Provincial Office

DR: Cash xxx


CR: ROA xxx

8.3 Check Payment to Contractors

DR: Operating Expense - Repairs xxx


CR: Vouchers Payable xxx

DR: Vouchers Payable xxx


CR: Cash xxx
III. RESPONSIBILITIES

1. Regional Engineer - PENGR - 01


1.1 Conducts inspection/evaluation and cost estimate for the
repair/maintenance to be undertaken per project/province, of
necessary.
1.2 Submits to the Regional Director final evaluation report of the
repair maintenance project to be undertaken.
1.3 Oversees the undertaking of projects which needs his
supervision.
1.4 Prepares monthly report of on-going and finished projects, cc.
INF.
1.5 Evaluates request for additional repair/maintenance works.
2. Provincial Engineer/Plant Engineer/Warehouse
Supervisor/Administrative Officer - PENGR-01/PLE-01/WS-08/PAO-01
2.1 Conducts preliminary inspection and evaluation of any
repair/maintenance projects.
2.2 Prepares request for repair/maintenance work in the project
(including the cost estimate).
2.3 Assists the Regional Engineer in the conduct of
inspection/evaluation for the major repair/maintenance jobs to be
undertaken in the province.
2.4 Oversees the implementation of projects which he can
effectively supervise.
2.5 Prepares monthly report of on-going and finished projects.
3. Regional Director - RD-01

3.1 Approves allocation for repair/maintenance projects per province.


3.2 Recommends for additional repair/maintenance funds
whenever the allocation for the region had been exhausted and
an immediate repair/maintenance work is imperative.
4. Provincial Manager - PM-04

4.1 Approves/recommends request for maintenance/repair works.


4.2 Approves check voucher of contractors.
IV. FLOW CHART
Top Page
EXHIBITS
No Exhibit/s Available for this SOP
SOP Library
SOP NO: FS-BC02 (List of Exhibits/Attachments)

Mission: Finance and Administration

Area: Financial Services (FS)

Activity: Budget and Control (FS-BC)

Title: NFA Budgeting System

Date Approved/Issued: 05/27/1997

Date Effective: 01/01/1997

Digest:

I. TERMS OF REFERENCE
A. Rationale
B. Objective
C. Scope
D. Basis

II. IMPLEMENTING GUIDELINES

A. General Policies

1. NFA prepares two (2) sets of Budget, namely:


1.1 Budgetary Estimates (BE) - budget
prepared by NFA which is the projection of income
and expenditures for the budget year. It is prepared
for the purpose of requesting budgetary support or
budget appropriation thru legislation as recommended
by DBM. It involves three (3) phases of the budget
process which are the budget planning, the budget
preparation and the budget authorization. deadline of
submission to the DBM is March preceding the
budget year.

1.2 Corporate Operating Budget (COB)


- is the operational budget of the agency
implemented in the current year. It involves the four
(4) phases of the budget process which are the
budget preparation, budget authorization, budget
execution and budget accountability. It is the revised
budget preapared based on the amount of budget
support as finally incorporated in the General
Appropriations Act (GAA). It is submitted to the DBM
every January of the current year.
2. NFA has three (3) main sources of funds for its operations:
these are the General Fund, Corporate Funds and the
Borrowings:
2.1 General Fund - fund releases from National
Government eithter as subsidy/support for the NFA
operations or equity contributions to its capitalization
or net lending which refers to advances or payment
made by the Bureau of Treasury for Guaranteed
Loans of NFA.
2.2 Corporate Funds - constitute the proceeds
from NFA operations such as sales of grains, income
from registration and licensing and other
miscellaneous income like sales of by-products, and
management facility assistance/service income.
2.3 Borrowings - are proceeds of loans by NFA
from government and private commercial banks.

3. The NFA Budget shall be prepared based on approved plans


and programs and in accordance with the Budget Call provided by
the Department for Budget and Management (DBM).

The guidelines formulated by the DBCC shall serve as the NFA


budget call for a particular calendar year. This budget call shall
discuss/contain the following:

a) Budget limitations/assumptions to be used;


b) The period or year to be covered for which the budget
estimates shall be prepared;
c) Submission deadlines - adjusted accordingly to the schedule
which may be set by the DBM;
d) Budget preparation format and contents;
e) Budget Calendar; and
f) Other pertinent data.

4. All departments/offices shall strictly observe the Planning and


Budgeting Calendar an example of which is presented in ANNEX
B.

5. Yearend unexpended fund balances for MOOE/PS/CPF shall


form part of NFA savings the use of which may be authorized by
DTBFM for the succeeding year.
B. Budget Process

I. Budgetary Estimates

1. Budget Planning
This is the first phase of budget process
where the agency's objectives/goals/plans
are developed. It is also where the
national development plans are translated
into corporate policies, programs and
strategies.

The Department of Corporate Planning


(DCP) is in-charge of coordinating and
facilitating the planning activities of all the
offices of the Agency starting from the
EXCOM members to the Central Office
and field office implementing units.

In this phase the DCP presents the NFA's


five year development plan which shall
serve as basis for the preparation of
budgetary estimates.

The four types of plans being prepared by


DCP are as follows:

1.1 The NFA Strategic Plan (Policy


Agenda)

This will define the general policy which


will guide NFA in carrying out its missions
and regular activities. The policy
directions are formulated and developed
by the EXCOM Members, approved by
the Administrator and confirmed by the
Council in accordance with the overall
national development plan and consistent
with the sectoral goals.

1.2 The Medium Term Development


Plan (MTDP)

The MTDP is a five-year plan drafted to


outline the medium-term outlook of the
Agency. It contains the objectives,
policies and strategies, targets
programs/projects as well as problems
and issues confronting the Agency.

The Assistant Administrators who head


the functional groupings of NFA are
primarily responsible for coming up with
the MTDP and assessing its progress of
implementation. This is prepared and
finalized by DCP to be presented to the
Administrator for approval and to the NFA
Council for confirmation. Upon
confirmation, all departments/offices shall
translate them into quantitative targets
and implementable programs and
projects for the next five (5) years.

1.3 The Corporate Budgetary Plan


(CBP)

This is a plan formulated to serve as


basis for determining the budgetary
requirements of the agency and the
support needed from the national
government for the budget year. CBP
includes the following documents:
Summary of accomplishments for
the past and current year to indicate
achievement trends of the Agency;
Projected physical targets for
budget year to denote change in
the desired level of performance;
Support services requirements; and
Financial requirements

The Assistant Administrators shall


spearhead the preparation of programs
requiring budgetary support in their
respective groups by drawing the specific
programs, projects and targets of the
different offices of the agency including
the field offices.

CBP is prepared to support the


preparation of the Budgetary Estimates.

1.4 The Corporate Operating Plan


(COP)

This is the Work Plan prepared to support


the Corporate Operating Budget (COB)
for a calendar year. It is generally
quantitative and very detailed in terms of
objectives, results and costs. It
enumerates the specific work or activity to
be undertaken for the current year on a
quarterly basis.

All departments and field offices are


required to prepare their respective Work
Plan following the prescribed format.
Each department and field office is
appraised in terms of achieving its
desired perforrmance level (for a given
period depending on the nature of
activity) vis-a-vis its resources and other
identified variables.
2. Budget Preparation

This is the projection of income and expenditures for


the budget year, using as framework NFA's national
work program covering one year of operations. it is
computed based on established programs and
priorities, existing conditions, trends analysis and past
year's operation using the macro-economic
assumptions, policies and limitations provided by the
Corporate Affairs Group of Department of Finance
(DOF-CAG) or the Department for Budget and
Management (DBM) through the Budget Call.

Preparation of budgetary estimates shall be done as


follows:
2.1 Based on the budget call issued by
NFA-DBCC, each division in every
Central Office Department and unit in
every Provincial/Regional Office shall
prepare their individual budget estimates
supported by Work and Financial Plan
covering one year of operation.

2.2 Budget estimates shall include all


expenditures classified as follows:
a) Cereal Procurement Cost -
estimated budget for the
cereal procurement fund (e.g.
palay, corn, etc.) which is
based on approved marketing
plan;

b) Capital/Equipment Outlay -
estimated budget for the
purchase/construction of fixed
assets necessary for NFA
operations (e.g. land,
building, equipment, repairs
and maintenance of
warehouses, etc.). It is
presented per major asset
classification per Chart of
Accounts, e.g. Land and Land
Improvement Outlays,
Building and Structure
Outlays, Machineries and
Equipment.

c) Personal Services -
estimated budget for
employees' salaries,
bonuses, allowances,
overtime pay, medicare,
GSIS premium contributions
and other related fixed
expenditures.

d) Maintenance and Other


Operating Expenses (MOOE)
- estimated budget for
travelling, supplies and
materials, light and water,
rental, interest payments, tax
payments, communication
expenses, repairs and
maintenance and other
operating expenses.

e) Loan Amortization -
schedule of loan payments
due for the year (e.g. bank
amortization).
2.3. All expenditures shall be presented
per program/project/object of expense in
accordance with the existing NFA
Responsibility Accounting System and
existing Chart of Accounts. The peso
estimates for each object of expense as
well as projected revenues to be
generated shall be reflected.

2.4. The Department Manager/Regional


Manager/ Provincial Manager shall
evaluate the budget estimates submitted
by each division/unit/section vis a vis their
worik plans and performance targets,
accomplishment reports and statement of
expenditures for the prior years'
operations. Existing economic conditions
and budget limitations specified in the
budget call shall be considered in the
evaluation for the budget to be realistic.

The Regional Manager shall call for a


budget hearing to discuss the budgetary
estimates submitted by the different
provinces under his jurisdiction.

The Provincial Manager shall conduct


budget meeting to discuss the preparation
of the provincial budget.

2.5. The respective Executive Assistant I


for C.O. departments, Budget Officer III of
the Regional Office and Sr. Accounting
Specialist of the provincial offices shall
consolidate the budgetary estimates
submitted by the different
divisions/units/sections of their
departments/offices after these had been
scrutinized by the Head of Office.

2.6. The consolidated budgetary


estimates shall be presented in the
prescribed format as provided in the
budget call. The budget form shall be
prepared in three copies to be distributed
as follows:

Copy 1 - DTBFM - Budget Division


2 - Department/Regional file
3 - Provincial file

2.7. Budgetary estimates for


Capital/Equipment Outlay shall be
submitted by C.O.departments/regional
offices (consolidated reports of provinces)
to the following lead department for
evaluation and consolidation:

TSD - Repairs and/or Capital Outlay for


NFA infrastructures and post-harvest
facilities.

GSD - Equipment Outlay and major


repairs of service motor
vehicles/aircraft/trucks.

MSD - Computer requirements based


on approved Information Systems Plan
(ISP) endorsed by National Computer
Center (NCC).

TRDD - Equipment Outlay for


Research and Development and Pest
Control requirements and meteorological
equipment.

Lead departments shall consolidate


capital/ equipment outlay of their concern
and shall submit same to DBCC for
recommendation to the Administrator.

All capital/equipment outlay approved by


the Administrator shall be included in the
Budgetary Estimates.

2.8. The DTBFM-Budget Division as the


Secretariat of the DBCC shall consolidate
the DBCC approved budget requirements
submitted by each department/office into
a national budget proposal.
3. Budget Authorization

Budget Approval and Confirmation


3.1. The proposed NFA Budget shall be
submitted to the Administrator for
approval, and to the NFA Council for
confirmation.

3.2. Upon approval of the Administrator,


and confirmation by NFA Council, it shall
be submitted to the Budget and Finance
Bureau for government Corporation,
Department of Budget and Management
copy furnished the Department of
Agriculture, Department of Finance - CAG
and COA.

3.3 The National Government's budget


support to NFA General Fund (GF) as
recommended by DBM becomes part of
the President's Budget which undergoes
the usual congressional review. Once a
common budget bill is agreed upon, the
bill becomes the General Appropriations
Act. (GAA).
II. Corporate Operating Budget

1. Preparation of the Corporate Operating Budget (COB)

Based on the GAA passed by Congress, NFA shall prepare the


COB which will be submitted to the NFA Council and DBM for
approval.
2. Budget Authorization

It is the Council's approval to implement the


Corporate Operating Budget.

3. Budget Execution

Refers to that phase of the budget process which


place a previously prepared Budget in operation. It is
here wherein Advice of Sub-Allotment (ASA) are
issued and obligations are incurred. It is the actual
distribution and spending of funds in accordance with
a predetermined course indicated in the Work and
Financial Plan prepared by all offices.
The allotment system shall be controlled by DTBFM-
BD which shall process allotment papers and request
for funds. There are, however, transactions that will
require for the issuance of the Advice of Sub-
Allotment as the need arises.
3.1. DBCC shall issue budget ceilings to
be approved by Deputy Administrator for
Finance and Administraion to each
Department/Regional Offices as bases for
the preparation of the Work and Financial
Plan (Exhibit 1) for the ensuing year.
a) Based on budget ceiling, a summary of
the work and financial plan per
program/activity of each responsibility
cost center covering one year of
operation shall be prepared. The
summary shall indicate the quarterly
physical targets and quarterly budgeted
expenditure of the office and shall show
further details of each project/activity and
corresponding objects of expenditure. It
shall be accompanied by 2 summaries to
wit::

Summary of Programs
and Activities
Summary of Budgeted
Expense Classification
per program/object

of expenditures
b) The work and financial plan shall be
prepared by the Regional Budget
Officer/Accountant IV/ SAS for the field
offices and Executive Assistant I for C.O.
departments. It shall be approved by the
Department Manager/Head of Office.
Consolidation of provincial reports shall
be done by the Accountant IV/Regional
Budget Officers.
c) The Work and Financial Plan for the
current year shall be submitted to
DTBFM-BD not later than January 31 of
the said calendar year, e.g. Work and
Financial Plan for 1997 shall be submitted
to DTBFM-BD not later than January 31,
1997.

Distribution of copies shall be as follows:

Provincial Officers:

Copy 1 - R.O. Finance Section


2 - P.O. Finance Section
3 - Provincial Office file

Regional Offices:

Copy 1 - R.O. Finance


2 & 3 - Regional Office file

Regional Office (Consolidated)

Copy 1 - DTBFM - BD
2 - DCP
3 - R.O. Finance

Central Office:

Copy 1 - DTBFM - BD
2 - DCP
3 - Department File

d) The Work and Financial Plan shall be


analyzed and reviewed by DTBFM - BD.
In no case shall the estimates exceed the
budget ceiling issued. Copy of the
Workplan shall be forwarded to DCP for
monitoring.

3.2 Release of Funds/Allotment


a) Advice of Sub-Allotment
shall be issued in accordance
with the approved budget
reflected in the Work and
Financial Plan submitted by
the different
Departments/Regional/
Provincial Offices.

b) An Advice of Sub-
Allotment approved by the
Assistant Department
Manager of DTBFM shall be
issued to the
department/regional offices
by DTBFM-BD ten (10) days
before the beginning of each
quarter. The advice shall
cover the major
classifications of budget items
with breakdown per
project/per object of expense
for all types of funds for all
offices to wit:

Personal
Services
Maintenanc
e and
Operating
Expense
Capital
Outlay
Loan
Amortizatio
n
Procureme
nt Cost

The advice of allotment shall be prepared


and distributed as follows:
To Central Office Departments:

Copy 1 - Department concerned


2 - DAS - Claims and Processing Division
3 - DAS - General Accounting Division
4 - COA
5 - DTBFM - Budget Division

To Regional Offices:

Copy 1
& 2 - R.O. concerned
3 - COA
4 - DTBFM - Budget Division
c) An Advice of Sub-Allotment
(ASA) shall be issued by the
Regional Office to its
provincial offices. It shall
cover an advice on the
amount of allotment for the
provincial office for
disposition per
program/object of expense.
Copy distribution for ASA
shall be as follows:

Copy 1
& 2 - P. O. concerned
3 - COA (Provincial Office)
4 - R.O. Finance Section

d) For Capital Outlay Budget,


the lead department prepares
request for appropriation of
funds. Same is forwarded to
DTBFM for funds availability
and is submitted to the
Administrator for approval.

e) Based on the approved


Advice of Sub-Allotment and
the Monthly SRDF reports,
DTBFM shall
allocate/recommend
remittance of funds for
Personal Services and
Maintenance and Other
Operating Expenses.

f) Bases of fund releases


shall be as follows:

Cereal Procurement Fund -


based on DMO's
recommendation as
requested by R.O.

Marketing Operations
Expenses - based on DMO's
recommendation as
requested by R.O.
(Procurement, Importation,
Drying, Milling/Remilling,
Dispersal/Transfer-In,
Distribution, Warehousing).

Regular Operating
Expenses (PS and MOOE) -
based on remittance thru
R.O. as evaluated by Budget
Division.

Security Services - based


on approved contract/request
of R.O.

Capital Outlay/RMT Funds -


based on R.O.'s
request/approved capital/
equipment outlay per
approved appropriations.

g) The Field Offices shall see


to it that fund request for
marketing operations
expenses shall be submitted
way ahead of time and
Central Office for its part,
shall facilitate the processes
for speedy actions.

h) Field Offices are not


authorized to use funds
earmarked for a specific
purpose unless authorized by
Central Office.

i) Failure to account their


funds/transactions for a given
period and non-submission of
reports would mean non-
remittance of funds, no
RATAHA/Rice Allowance per
AO-95-05-041.
3.3. Fund Control
a) All expenditures/incurrence
of obligations shall be
controlled by the accountants
of respective offices.

b) Fund Control ledgers shall


be maintained per Fund/per
object of expenditures. Same
shall be updated immediately
as funds availability are
certified on disbursement
vouchers, Purchase Orders,
Letter Orders and Contracts.

c) If fund balance is not


sufficient, the concerned
departments/accounting
section shall request for
realignment of
fund/Supplemental Budget if
necessary.

d) At the end of the month


DAS-CIAD/Accounting
Section shall issue an
updated SRDF to concerned
departments/offices for them
to monitor their expenses.
3.4. Realignment of Funds
a) All departments/offices
shall spend within the limits of
the budget submitted and
approved.

However, to maintain the


smooth flow of operations,
realighment/reallocation of
the budget maybe allowed
provided that the following
conditions are considered:

That the
circumstan
ce is
unavoidabl
e and that
the
realignment
will not
have an
adverse
effect on
the
accounts/o
bjects of
expenses/o
ffice
affected,
provided
total
obligations
incurred do
not exceed
total
allotment
issued.

That the
realignment
is within the
limits of a
particular
fund and
within the
major
classificatio
n of
expenditure
, i.e.
Personal
Services,
MOOE,
CPF,
Capital
Outlay.

E.g.
Trans
fer
from
perso
nal
servic
es to
maint
enan
ce
and
other
opera
ting
expe
nses
shall
not
be
allow
ed
and
vice-
versa
.

Request for
authority to
use the
current
allotment
for project
not within
the Work
Program
should be
properly
justified by
the headof
office/
department
and
submitted
to the
DTBFM
Department
Manager
thru the
Budget
Division for
proper
action.

b) If the above conditions are


met, the Heads of Office shall
submit to DAS/ Accounting
Unit a Letter Request to
realign the fund allocation.
Any realignment/ reallocation
of fund must be disclosed on
the report submitted to
DTBFM-Budget Division.
3.5. Withholding/ /Deduction of Funds
from the Allotment
a) The Budget Division of the
DTBFM/ RO- Finance may
withhold/ deduct the
remittance if there is still an
unexpended balance from
previous allotment which may
be used to cover-up
expenditure for the next
quarter. In this case, DTBFM-
BD shall issue the authority to
use the unexpended balance
approved by DTBFM
Department Manager.

b) A portion of an allotment
may also be withheld/
deducted if it can be
determined that such amount
is not needed.
3.6. Request for Supplemental Budget

Department Managers/ Heads of Office


may request for a supplemental budget
with proper justification for approval by
the Deputy Administrator for Finance and
Administration and with certification of
funds availability from the DTBFM-BD.
4. Budget Accountability

This is the final phase of the budget process which


calls for the reporting of actual performance against
plans. Through Monthly/ Quarterly reports, each office
entrusted with the fund shall account to management
not only his stewardship of the fund but also the
effective implementation of the NFA programs under
his jurisdiction.

The Heads of Office shall have the sole/ full


responsibility on the utilization of the entire budget
allotted to them.

Budget accountability shall be monitored by DTBFM-


BD thru the following reports:
4.1. Statement of Obligation Incurred
(SOI)
A report which summarizes
all the expenses incurred per
program/ activity/ object of
expense compared vis-a-vis
the allotment for the same
period. The SOI shall be
prepared quarterly for all
major expenditure
classification such as
Personal Services,
Maintenance and Other
Operating Expenses, Cereal
Procurement Cost, Capital
Outlay and submitted not
later than the 20th of the
following month. Preparation,
consolidation and distribution
of copies for the said report
shall be in accordance with
the existing NFA structure
(Exhibit 2).

4.2. Statement of Receipt and


Disposition of Funds (SRDF)

A report showing the monthly cash


position per fund account/ expense
classification. The SRDF per province
shall be submitted not later than the 10th
day of the following month for
consolidation at the regional office. The
consolidated regional SRDF shall be
submitted to C.O. by the R.O. not later
than the 20th day of the succeeding month
(Exhibit 3):

Non-consolidated SRDF:

Copy 1 & 2 - Regional Office


3 - P. O. Office

Consolidated SRDF:

Copy 1 & 2 - DTBFM - Budget Division


3 - R. O. file

4.3. Reconciliation Statements of SOI


vs SRDF

This reconciles disbursements per SRDF


as against the items reflected in the
Consolidated Statement of Obligations
Incurred. (Exhibit 4)
The foregoing SOP supersedes FOM SOP Numbers
06.01, 06.02, and 06.03 issued and made effective
January 1, 1977.

All rulings and/or issuances inconsistent herewith are


hereby superseded.

This SOP shall take effect on the 1st day of January,


1997.

Date Approved : May 27, 1997


III. RESPONSIBILITIES

IV. FLOW CHART


Top Page
EXHIBITS
No Exhibit/s Available for this SOP
SOP Library
SOP NO: FS-FA05 (List of Exhibits/Attachments)

Mission: Finance and Administration

Area: Financial Services (FS)

Activity: Financial Accounting (FS-FA)

Title: Responsibility Accounting System

Date Approved/Issued: 08/11/1987

Date Effective: 01/01/1987

Digest:

I. TERMS OF REFERENCE
A. Rationale
B. Objective
C. Scope
D. Basis

II. IMPLEMENTING GUIDELINES

A. Responsibility Centers
Each office, directorate, regional and provincial office shall
operate under responsibility cost center concept. All items of
expense incurred in the area of responsibility shall be charged to
the cost center. The head of the cost center shall be responsible
for keeping costs and expenses within budgeted limits. Expenses
shall be viewed as the responsibility of the manager of the
organizational unit where costs originate. The Manager at this
level is authorized to incur expenses and is in a position to
exercise direct control over them. In this way, the effectiveness of
managers can be judged on the basis of expenses incurred
directly under his control.

Thru responsibility accounting system, cost and expenses shall be


controlled at different managerial levels, as follows:
1. It is the responsibility of the Administrator/Deputy
Administrators to control cost incurred by NFA in a national level.
However, authority is delegated to different managerial levels for
which heads are held responsible for.

2. The Assistant Administrator is responsible for the operation of


his group. He shall oversee the operation of his group. He shall
oversee the operation of the directorates under his umbrella and
shall monitor how expenses are being controlled by each Director.
The Assistant Administrator shall be accountable to the Deputy
Administrator/Administrator for the total accomplishment of his
group.

3. The Authority is further delegated to the Director, as such, he


shall be accountable to his Assistant Administrator for the
operation of the Directorate under his direction. It is his
responsibility to install control measures in which he can monitor
the accomplishment of his Division Chiefs who are responsible to
him for the expenses and accomplishment of their respective
divisions. On the other hand, the section chiefs are responsible to
their respective Division Chiefs.

4. At field offices, the authority is vested to the Regional Director


to carry out the objectives of NFA in his area of jurisdiction. He
shall adopt effective monitoring device to monitor the performance
of the regional unit heads, and Provincial Managers who are
responsible for all the expenses incurred by their respective
sections/units/provincial offices. The Regional Director shall be
answerable to the Deputy Administrator/Administrator for the total
operation of the entire region.

5. The authority is further delegated to the Provincial Manager, he


shall be accountable to his Regional Director for the total
operation of the provincial office. He shall adopt effective control
measures in which he can monitor the accomplishment of his
provincial unit heads who are answerable to him in controlling the
expenses of each section/unit and at the same time efficiently
accomplishing the objectives of NFA at the provincial level.
B. Project/Activity/Departmental Costing
1. All expenses shall be recorded and summarized by
project/activity or departments. At field offices, activity and sub-
activity cost centers are provided under each project, and at C.O.,
the activity cost centers refer to departments/offices which
composed the project group.

2. The following are the projects/activities/departments which are


based on missions and objectives of NFA and on organizational
structure. The corresponding expenses incurred for each
project/activity/department shall be the responsibility of the
concerned head of responsibility cost center.

The activity cost centers at the field offices are facsimiles of the
central office cost centers to make sure that policies emanating
from the top management will be smoothly carried out by the field
office counterparts. However, authority for actions shall emanate
from the respective Regional Director/Provincial Manager as it is
his area of responsibility.

Project 1 - Stabilization
This project shall be involved in procurement, processing
and distribution of vital food commodities. This project deals
with demand, supply and prices and aims to effect a market
intervention.

The C.O. activity/department cost centers under this project


are the following: This project group is headed by the
Assistant Administrator for Stabilization and each
department has a Director.

130 Marketing Operations Management (DMO)


140 Technical Services Management (TSD)
150 Stabilization Management (AAS)

The F.O. activity cost centers under this project are the
following, with the corresponding expenses chargeable
against this project:

100 Marketing Operations - all expenses incurred in the


marketing operations in the field such as all inventory costs,
personal services travelling expenses, supplies and
materials and other maintenance and operating expenses
directly identified to marketing operations section. The
following sub-activities are provided under this activity:
101 Procurement
102 Importation
103 Milling
104 Drying
105 Remilling/Reconditioning
106 Dehulling
107 Warehousing
108 Dispersal
109 Transfer-in
110 Distribution
111 Exportation
112 General Operations

At the regional office, the Marketing Operations Section is


headed by the Regional Operations Officer; and the
Provincial Level, the Provincial Operations Officer heads the
Marketing Operations Section.
120 Technical Services - all expenses incurred in the quality
assurance, pest control, calibration, repair and maintenance of
weighing and moisture measuring equipment and other
meteorological facilities, maintenance and depreciation of post
harvest facilities, personal services, travelling expenses, supplies
and materials, and other maintenance and operating expenses
directly chargeable to technical services section.

The Technical Services Section is composed of the Facility


Management Unit and Quality Assurance Unit. At the regional
office, these units are headed by the Regional Engineer and the
Regional SQAO, respectively; and at the provincial level, the units
are headed by the Plant Engineer and the Provincial SQAO,
respectively.

Project II - Marketing Development

This project shall be involved in marketing research,


extension, promotions and market development. This
project deals with activities that come in the form of industry
assistance with the private sector.

The activity/department cost centers at Central Office under


this project are the following: This project group is headed
by the Assistant Administrator for Marketing Development
and each department has a Director.

210 Technology Resource and Development Management


(TRD)
220 Extension Management (EXT)
230 Business Development and Promotion Management
(BDP)
240 Marketing Development Management (AAMD)

The field office activity cost center under this project is the
following, with the corresponding expenses chargeable
against this project:

200 Marketing Development - all expenses incurred in the


implementation of market development program,
information dissemination on technology research and
development, marketing extension program, resource
materials, technical bulletin, primer, handouts, charts, visual
aides, other supplies and expenses on seminars, personal
services, travelling expenses and other maintenance and
operating expenses incurred by the marketing development
group.
At the regional office, the marketing
development group is composed of Business
Development and Promotion Section and
Extension Section. These sections are headed
by the Sr. Market Analyst and the Operations
Officer II, respectively. At the provincial office,
the Operations Officer I takes charge of the
marketing development section.
Project III - Industry Regulation

This project shall be involved in licensing, intelligence and


enforcement activities on business behaviour for the
protection of the consuming public.

The activity/department cost centers at C.O. under this


project are the following: This project group is headed by
the Assistant Administrator for Industry Regulation and each
department has a Director.

320 Business Regulation Management (BRD)


330 Enforcement Management and Legal Services (DELA)
340 Industry Regulation Management (AAIR)

The field office activity cost centers under this project are
the following, with the corresponding expenses chargeable
against this project:

300 Registration and Licensing - all expenses incurred in


registration and licensing of food businessmen such as
personal services, supplies and materials, travelling
expenses and other operating expenses incurred by the
registration and licensing section.
At the regional office, the Registration and
Licensing Section is headed by the
Regional Registration and Licensing
Officer (RLO); and at the provincial level,
the Provincial RLO heads the Registration
and Licensing Section.
310 Enforcement and Intelligence - all expenses incurred in
the implementation of enforcement policies, conducts of
surveillance and intelligence activities including personal
services and maintenance and other operating expenses
incurred by the enforcement and intelligence section.

Project IV - Corporate Services

This project shall be involved in corporate administration,


planning, financing, personnel management, operational
review and support activities.

The activity/department cost centers at Central Officer


under this project are the following: The heads of
offices/directorates of the executive offices shall be directly
responsible to the Office of the Administrator. The Support
Services Group is headed by the Assistant Administrator for
Corporate Administration and each Department has a
Director.

400 Administration - Office of the Administrator (AO)


410 - Office of the Council Secretary (OCS)
420 - Office of the Deputy Administrator for
Corporate Affairs (ODACA)
430 - Office of the Deputy Administrator for
Industry Affairs (ODAIA)
440 Staff Services - Directorate for Corporate Planning
(DCP)
450 - Internal Audit Directorate (IAD)
460 - Directorate for Public Affairs (DCP)
470 - Special Operations Coordinating Office (SOCO)
480 Support Services - Human Resource Management
Directorate (HRMD)
490 - Directorate for Accounting and Budget (DAB)
500 - Directorate for Treasury and Fund Management
(DTFM)
510 - General Services Directorate (GSD)
520 - Management Services Directorate (MSD)
530 - Office of the Assistant Administrator for Corporate
Affairs (AACA)
540 COA Services

The field office activity cost centers under this project are
the following, with the corresponding expenses chargeable
against this project:

540 COA Services - all expenses incurred by the COA and


its accomplishment of government auditing functions.

550 General Administration - all expenses incurred by the


Office of the Regional Director/Provincial Manager,
Administrative and General Services and Finance in support
to the total accomplishment of NFA programs in the field
offices.

At the field office, the Corporate Administration Group is


composed of the Administrative and General Services
Section and Finance Section. These sections are headed
by the Regional Administrative Officer and Regional
Accountant at the regional office, respectively and by the
Provincial Administrative Officer and Provincial Accountant
at the provincial office, respectively.

Project V - Special Projects

This project shall be involved in special operations activities


or foreign assisted operations. The specific project activities
are listed in Annex A.
3. Expenses shall be allocated to the specific cost center to which they
are identified with.
3.1 All expenses under Personal Services except for
procurement allowance shall be charged to the cost center
to which the position is attached.

Procurement allowance shall be charged to marketing


operations activity of the field office regardless of the
permanent assignment of the employee concerned.

3.2 Expenses under Maintenance and Other Expenses shall


be charged as follows:
a. Travelling expenses shall be chargeable to the cost
center to which the position is attached, except:
a.1 Travels by C.O. personnel requested
by the F.O. e.g. assistance in
procurement operations and technical
assistance on computer operations after
installation and acceptance: the travelling
expenses shall accrue to the requesting
cost center. For billing purposes, a copy
of the request shall be attached to the
TEV of the Center Office personnel.

a.2 For group undertakings (team work):


the purpose of the undertaking shall be
considered in the allocation of expenses.
Travelling expenses resulting from an
activity with an identified beneficiary (e.g.
IAD, DMO and DAB being the head
directorates in the case of the National
Inventory Taking intended to update and
reconcile inventory records) shall be
charged to the cost center which directly
benefited from the project. Those
resulting from an activity with a common
objective shall accrue to the respective
cost center (where the position is
attached) taking part of the undertaking.
Travel authorization for group
undertakings shall reflect the cost center
to be billed.
b. Communication services shall accrue to the
sending cost center.

c. The purpose for which the expenses is


incurred or caused for its incurrence shall be
the basis in the allocation of the following
expenses: supplies and materials; rents; repairs
and maintenance of NFA facilities (buildings,
offices and warehouses), machineries,
furnitures and fixtures, equipment,
transportation facilities (service vehicle, aircraft,
watercraft, and trucks); subscription;
honorarium; taxes, duties and fees; training and
personnel improvement; depreciation; losses
due to condemned properties; and awards and
indemnities.
C. Responsibility Reporting System
1. The following responsibility reports are complementary to each
other with regards to performance evaluation and shall serve as
basis for allocation of resources:
1.1 Statement of Obligation Incurred (SOI-Exhibit 1-3)
- this report summarizes all the expenses incurred per
project/activity compared with allotment for the same
period.

1.2 Physical Performance Report (PPR) - this refers


to the accomplishment report of the cost center for a
specified period compared with physical targets for
the same period. (Please see Annex B for units of
work measurement).
2. Responsibility reports shall be prepared quarterly. Same
shall be submitted not later than the 25th of the following
month.
Responsibility Responsibility Prepared by/
Center Report Noted by Submitted To
------------------- ------------------- ------------------ -------------------

Provincial Office
a. Per Project/ SOI & PPR Prov. Acct./ Reg'l Dir.
Activity Prov. Mgr. cc: Reg'l
Prov. Unit Accountant
Head/Prov.
Mgr. cc: Prov.
Accountant

b. Consolidated SOI & PPR Prov. Acct./ Reg'l Dir.


Prov. Mgr. Attn: Reg'l
Accountant
Regional Office
a. Per Project/ SOI & PPR Reg'l. Acct./ Concerned
Responsibility Reg'l. Dir. Deputy Adm.
Center Reg'l. Unit thru the con-
Head/Reg'l. cerned Asst.
Director Adm./DAB-
Budget and
Fiscal Div.

b. Consolidated SOI (per Project/ Reg'l. Acct./ DAB-Budget


Activity and Reg'l. Dir. & Fiscal Div.
Consolidated)
& PR

Central Office
a. Per Activity/ SOI DAB-Central DAB-Budget &
Department Office Acctg. Fiscal Div.
Division cc: concerned
Asst. Adm./
Budget and
Fiscal Division

b. Consolidated SOI DAB-Central DAB-Budget &


(Per Project/ Office Acctg. Fiscal Div.
Activity) Division

c. Consolidated SOI DAB-National DAB-Budget


Report on a Accounting & Fiscal
National Level Division Division

3. Flow of responsibility reports at various levels

3.1 At field offices, per project/activity


a. Stabilization
The Provincial Operations Officer,
Provincial SQAO and the Plant
Engineer shall submit their
Responsibility Reports to the
Assistant Provincial
Manager/Provincial Manager cc:
Provincial Accountant. The
Provincial Manager shall review
and submit the same to the
Regional Director.

All the provincial responsibility


reports for stabilization shall be
consolidated by the Regional
Operations Officer/Regional
Engineer/Regional SQAO. Same
shall be submitted to the Deputy
Administrator for Corporate Affairs
thru the Assistant Administrator for
Stabilization.
b. Marketing Development
The Operations Officer I (Marketing
Development) shall submit his
Responsibility Reports to the
Assistant Provincial
Manager/Provincial Manager cc:
Provincial Accountant. The
Provincial Manager shall review
same and submit the report to the
Director.

All the provincial responsibility


reports for Marketing Development
shall be consolidated by the
Operations Officer II/Sr. Market
Analyst.

Same shall be submitted to the


Deputy Administrator for Industry
Affairs thru the Assistant
Administrator for Marketing
Development.
c. Industry Regulation
The Provincial RLO and the
Provincial Investigator shall submit
their Responsibility Reports to the
Assistant Provincial
Manager/Provincial Manager cc:
Provincial Accountant. The
Provincial Manager shall review
same and submit the consolidated
report to the Regional Director.

All the provincial responsibility


reports for Industry Regulation shall
be consolidated by the Regional
RLO/Regional Investigator. The
consolidated regional report shall
be submitted to the Deputy
Administrator for Industry Affairs
thru the Assistant Administrator for
Industry Affairs.
d. Corporate Services
The Provincial Administrative
Officer and the Provincial
Accountant shall submit their
Responsibility Reports to the
Assistant Provincial
Manager/Provincial Manager cc:
Provincial Accountant. The
Provincial Manager shall review
same and submit consolidated
report to the Regional Director.

All the provincial responsibility


reports for corporate services shall
be consolidated by the Regional
Administrative Officer/Regional
Accountant. The consolidated
regional report shall be submitted to
the Deputy Administrator for
Corporate Affairs thru the Assistant
Administrator for Corporate
Administration.
3.2 Consolidated Field Office Responsibility Reports
The Provincial Accountant shall consolidate the
Provincial SOI and PPR and submit same to the
Regional Accountant. The Regional Accountant
shall consolidate all provincial reports (SOI and
PPR) and submit same to DAB-Budget and
Fiscal Division.
3.3 At Central Office

The Director/Heads of Offices shall require


accomplishment report from the Division Chiefs. The
Staff Assistant shall consolidate the Divisions' Reports
for submission to the concerned Assistant
Administrator and to DAB-Budget and Fiscal Division
(DMO and TSD to AA for Stabilization; BDP, EXT.
TRDD to AA for Marketing Development, DELA and
DBR to AA for Industry Regulation; HRM, GSD,
DTFM, DAB, MSD to AA for Corporate Administration;
and SOCO, IAD, DCP, DPA to the Office of the
Administrator).
D. Income Statement
1. An Income Statement showing results of operation per project
(Exhibit 7) shall be prepared by the Provincial Accountant monthly
and quarterly (attached to Trial Balance). Same shall be
consolidated by the Regional Accountant for submission to DAB.
The Income Statement will serve as gauge for the Provincial
Manager/Regional Director on how they performed for each
project.

2. A Consolidated income Statement (national level) showing


results of operation per project shall likewise be prepared by DAB-
National Accounting Division quarterly. A copy of the consolidated
income statement shall be furnished to the Assistant
Administrators, Deputy Administrators and to the Office of the
Administrator.

3. In the preparation of the income statement, all receipts/income


shall be credited to the project that generated the income. Grants
and donations received shall be credited to the project
beneficiary.
E. Monitoring Expenses, Income and Accomplishment at Different
Levels
1. The Office of the Assistant Administrators shall monitor the
expenses and accomplishment of each Directorate under their
respective umbrellas. It shall be the responsibility of their office to
formulate performance standards applicable to each directorate
under their respective control. The Assistant Administrator shall
use these standards in the performance evaluation of the
Directors under him.

The Directors of the Staff Offices shall be evaluated by the Office


of the Administrator.

2. At the Director's Level (Central Office)


In order to afford the Director/Head of Office of each
Central Office directorate the effective control of
expenses incurred by his responsibility center, a fund
control ledger (Exhibit 6) shall be maintained by the
respective Administrative Assistants. The respective
Administrative Assistants shall coordinate with DAB-
Central Office Accounting Division every end of the
month or as often as necessary to update fund control
ledger and enable the Director/head of Office to know
the balance of the allotment per object of expenditure
and therefore control incurrence of expenses.

It shall be the responsibility of the Director to devise


internal systems by which he can monitor the
accomplishment of each Division and to make the
lowest level of management (section/unit) aware of
the expenses being incurred by them and enjoin their
participation in controlling expenses.
3. At the Regional Director's Level
The Regional Director shall likewise install internal
systems in monitoring the accomplishment and
expenses of each provincial office and each regional
section/unit. The system should provide control at the
lowest level of management (Section/Unit) who
should be aware of how much they are spending.

It shall be the responsibility of the Regional Director to


evaluate the performance of the Provincial Managers
under his direction. (The details on performance
evaluation will be discussed in Module 3 of the
Responsibility Accounting System - the Performance
Appraisal System).

The Regional Director shall also monitor the income


earned by the entire region from the income
generating projects. The Income Statement per
Project (Exhibit 7) and the responsibility reports will
gauge the Regional Director on how each Provincial
Office and the entire region performed in each project.
With these reports, the Regional Director will be able
to:

a. Compute the stabilization cost incurred for each 50-


kilo bag of grains handled (total
Stabilization cost over Total volume Handled in bags of 50-
kl);

b. Determine the net income derived from the


Marketing Development Project and Industry
Regulation Project; and

d. Determine the total expenses incurred by the


Corporate Services Group in support to the three
projects (Stabilization, Marketing Development and
Industry Regulation).
The aforementioned data plus other factors will
help the Regional Director in evaluating results
and formulating the necessary corrective action.
4. At the Provincial Manager's Level
The Provincial Manager shall also formulate internal
monitoring system for the accomplishment of all the
section/units at the provincial office. The system
should provide control at the lowest level of
management (section/unit) who must be aware of the
expenses incurred by them.

With the responsibility reports submitted to him by the


provincial section/unit heads and the monthly income
statement, the Provincial Manager should be able to:
a. Compute the stabilization cost incurred for each 50-
kilo bag of grains handled (Total Stabilization Cost
Over Total Volume Handled in bags of 50-kilo) by the
province;

b. Determine the net income derived from the


marketing development project and industry
regulation project; and

c. Determine the total expenses incurred by the


corporate services group in support to the three
projects (Stabilization, Marketing Development and
Industry Regulation).
The aforementioned data plus other factors will
help the Provincial Manager identify where
wastage exists and evaluate cost effectiveness,
efficiency and economy at the provincial level.
4. Control Over Fixed and Variable Expenses
4.1 Fixed expenses are those expenses which remain
constant regardless of the operating level (volume of
operations). The objects of expenditure under this
classification are personal services, rents, depreciation of
fixed assets, insurance of stocks and fixed assets and other
fixed expenditure. These expenses are however
controllable in one way or another, i,e, idle fixed assets can
be transferred to the office where the assets will be most
utilized; a warehouse lease contract can be terminated if the
warehouse is no longer in maximum use and if such action
will not hamper the operation; and by maximum utilization of
manpower resources.

4.2 Variable expenses are hose expenses which vary in


direct proportion to the operating level (volume of
operation). Most of the expenses under maintenance and
other operating expenses are variable except those items
enumerated in 4.1. Some variable expenses are
controllable and others are uncontrollable.
Controllable variable expenses are those
expenses which can be sacrificed, avoided or
minimized without hampering the operation.
Those expenses which are categorized as
unnecessary, irregular, excessive or
extravagant expenditures are controllable
expenses.

Uncontrollable variable expenses are those


expenses which are very necessary in the
performance of service or those which will
adversely affect the operation should the
expenses are not incurred.
III. RESPONSIBILITIES

A. Unit Heads/Section Chief


Submits accomplishment report of the section/unit to his Division
Chief/Provincial Manager cc: Provincial Accountant.
_______
B. Provincial Manager/Division Chief / PM - 56 /

1. Monitors the accomplishment of the sections/units under his control.


2. Reviews accomplishment report of the units/sections.
3. Submits Physical Performance Report/Accomplishment Report to his
Director/
Regional Director.

C. Regional Unit Heads/Staff Assistant


Consolidates Physical Performance reports of provincial
units/division.
_______
D. Regional Director/Director / RD - 24 /

1, Monitors the expenses and accomplishment of the cost center under


is direction.
2. Submits the responsibility reports to Deputy Administrators/Assistant
Administrators
or Office of the Administrator.
__________
E. Provincial Accountant / PACNT - 26 /

1. Prepares statement of obligation incurred per project/activity and


consolidated
provincial SOI.
2. Consolidates the Provincial Physical Performance Report and
submits same to the Regional Accountant.
__________
F. Regional Accountant / RACNT -08 /

Consolidates the regional responsibility reports (SOI and PPR) and


submits same to DAB-
Budget and Fiscal Division.

G. Administrative Assistants (C.O.)


Maintains Fund Control Ledger and coordinates with DAB on the
expenses incurred/updating of fund control ledger.
H. Supply Officer/GSD

Summarizes supplies, materials usage by each cost center and


furnishes DAB/Finance Unit with the report on charging of
expenses cc: concerned office, DAB Budget and Fiscal Division.
I. Human Resource Directorate
Summarizes training cost chargeable to each cost center/office
and furnishes DAB with the report on charging of expenses cc:
concerned office, DAB-Budget and Fiscal Division.
J. DAB - Central Office Accounting Division

Prepares SOI per directorate/office.

K. DAB - National Accounting Division

Prepares Consolidated Income Statement (National) showing result of


operation per project.

L. DAB - Budget and Fiscal Division

1. Monitors and evaluates budgetary requirements of each responsibility


center
2. Prepares Consolidated SOI (national level).
IV. FLOW CHART
Top Page
EXHIBITS
Project/Activity and Cost Classification
Physical Performance Report
Exh.1A-RESP.ACTG.
Fund Control Ledger-Exh 6

SOP Library
SOP NO: FS-FA06 (List of Exhibits/Attachments)
Mission: Finance and Administration

Area: Financial Services (FS)

Activity: Financial Accounting (FS-FA)

Title: Cost Classification

Date Approved/Issued: 05/01/1989

Date Effective: 05/01/1989

Digest:

I. TERMS OF REFERENCE
A. Rationale
B. Objective
C. Scope
D. Basis

II. IMPLEMENTING GUIDELINES

A. Cost Classification
1. Administrative expenses - these are expenses incurred in the
general direction, control and administration of the organization.
Included under this classification are:
1.1 All expenses (personal services and maintenance
and other operating expenses) incurred by the Central
Office, and

1.2 All personal services incurred by the field offices


2. Operating Expenses - these are expenses incurred in
conducting major activities with direct relation to operations.
Included under this classification are all objects of expenditure
under maintenance and other operating expenses (MOE) incurred
by the field offices under the following projects/activities:

2.1 Stabilization

a. Marketing Operations
a.1 Remilling - this shall
include handling, trucking and
other overhead expenses
incurred in remilling grains
stocks.
a.2 Reconditioning - this shall
include handling, trucking and
other overhead expenses
incurred in reconditioning
grains stocks.

a.3 Warehousing - this shall


include such expenses as
warehouse rental, handling,
trucking and other expenses
incurred in the transfers of
stocks within the province
and other overhead expenses
in warehousing activity.

a.4 Dispersal - this shall


include all expenses incurred
in the transfer of stocks from
one province to another.
Included under this activity
are expenses incurred from
the issuing warehouse up to
the receiver's point such as
handling expenses from pile
to truck, port expenses at
origin and transportation
expenses to the receiver's
point.

Dispersal expenses shall be


shouldered by the issuing
province.

a.5 Transfer-in - the spillage


expense incurred in the
transfer of stocks from one
province to another shall be
taken up as operating
expense of the receiving
province, all other transfer-in
expenses are inventory costs.

a.6 Distribution - this shall


include all expenses incurred
in the sales/local distribution
of grains stocks to
retailers/consumers, e.g.
handling expenses, gas and
oil incurred in mobile sales.

a.7 Exportation - this shall


include all expenses incurred
in the exportation of grains
stocks such as handling, port
expenses, etc.

a.8 General Operations - this


shall include all operating
expenses incurred by the
Marketing Operations Section
in its general operations
activity; those expenses
which are not directly
identified to the
aforementioned sub-activities.

The personal services of the


Marketing Operations Section
shall likewise be under this
sub-activity as administrative
expense.
b. Technical Services - all MOE incurred
by the Facility Management Unit and
Metrology and Quality Assurance Unit.
2.2 Marketing Development - includes all MOE
incurred by the Marketing Development Section.

2.3 Industry Regulation


a. Registration and Licensing - includes
all MOE incurred in the registration and
licensing of food businessmen.
b. Enforcement and Intelligence - includes
all MOE incurred by the Enforcement and
Intelligence Section.
2.4 Corporate Services
a. General Administration - includes all
MOE incurred by the Office of the
Regional Director/Provincial Manager,
Administrative and General Services
Section and Finance Section.

b. COA Services - includes all MOE


incurred by the Office of Auditor (COA).
3. Inventory Cost - this shall include all objects of
expenditures under maintenance and other operating
expenses incurred under marketing operations sub-
activities namely: procurement, importation, drying, milling
and transfer-in; these costs are necessary in preparing the
inventories ready for sale.
3.1 Procurement Costs - this shall cover those
expenses incident to the purchase of local cereals
from farmers up to its delivery for original storage in
warehouses such as the following:

a. handling
b. trucking
c. empty sack

3.2 Importation Costs - this shall include all expenses


relative to imported stocks from negotiation to actual
delivery in the first terminal warehouse such as:

a. bank charges
b. customs taxes and duties, and
c. unloading expenses - from foreign vessel up to the
warehouse of
original storage

3.3 Drying Expenses - this shall include handling and


overhead charges incurred for the actual drying or wet
stocks.
3.4 Milling Expenses - this shall include handling and
overhead expenses like fuel, oil, trucking and direct
milling expenses in addition to the usual milling fees.

3.5 Transfer-in Expenses - this shall refer to expenses


at receiver's point from truck/vessel to the warehouse
i.e. port expenses at receiver's point, trucking
expenses from port to warehouse and handling
expenses from truck to pile.

3.6 Dehulling Expenses - this shall refer to handling


and overhead charges such as fuel and oil and other
direct expenses incurred in the dehulling of palay.
4. Project/Activity/Department Codes and Classification of Costs
Under each Project/Activity/
Department are presented in Annex A.

III. RESPONSIBILITIES

IV. FLOW CHART


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EXHIBITS
No Exhibit/s Available for this SOP