State Accounting Rules and Regulations
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Questions and Answers

What prevails in case of conflict between GAAP and legal provisions?

  • GAAP
  • Government auditing standards
  • Legal provisions (correct)
  • COA issuances

    • What is the purpose of government auditing according to the Government Auditing Code of the Philippines?

  • To inspect and verify financial transactions
  • To determine the accuracy, integrity, and authenticity of reports (correct)
  • To prepare financial statements
  • To implement internal control systems

    • What is the role of the Commission on Audit in relation to accounting rules and regulations?

  • To conduct government auditing
  • To prepare financial statements
  • To promulgate accounting rules and regulations (correct)
  • To implement internal control systems

    • What are the state accounting standards based on?

    <p>COA issuances</p> Signup and view all the answers

    What is developed by the different government agencies and approved by the Department of Budget and Management?

    <p>Accounting systems</p> Signup and view all the answers

    What is the relation between auditing and accounting?

    <p>Auditing and accounting are distinct but closely intertwined</p> Signup and view all the answers

    What is the purpose of using a Standard Government Chart of Accounts (SGCA) in state accounting?

    <p>To effect uniformity in accounting and reporting</p> Signup and view all the answers

    What is the exclusive authority of the Commission on Audit (COA) according to Section 2(2) of the 1987 Constitution?

    <p>To define the scope of its audit and examination</p> Signup and view all the answers

    What type of written documents are required to support transactions in state accounting?

    <p>Sufficient, formal written documents</p> Signup and view all the answers

    What is the purpose of promoting a realistic picture of government operations in financial reports?

    <p>To ensure transparency and accountability</p> Signup and view all the answers

    What is the role of the Public Finance Adviser in state accounting?

    <p>To provide guidance on reading purposes</p> Signup and view all the answers

    What type of expenditures does the Commission on Audit (COA) aim to prevent and disallow?

    <p>Irregular, unnecessary, excessive, extravagant, or unconscionable expenditures</p> Signup and view all the answers

    What is the primary principle governing the expenditure of government funds?

    <p>Spending for public purposes</p> Signup and view all the answers

    What is the basis for releasing allotments to government agencies?

    <p>Quarterly requirement</p> Signup and view all the answers

    What is the recommended accounting basis for government expenditures?

    <p>Accrual basis</p> Signup and view all the answers

    What is the purpose of a notice of cash allocation issued by the DBM?

    <p>To allocate budget appropriations</p> Signup and view all the answers

    What is the responsibility of disbursing officers regarding cash and accountable forms?

    <p>To keep them in safe custody</p> Signup and view all the answers

    What is the recommended practice for cash books of disbursing officers?

    <p>To keep them up-to-date, footed, and ruled at the end of each month</p> Signup and view all the answers

    Study Notes

    Government Accounting Principles

    • Government accounting is strictly anchored on specific laws, standards, rules, and regulations.
    • In the absence of specific laws or rules, government accountants follow Generally Accepted Accounting Principles (GAAP).
    • In case of conflict between GAAP and legal provisions, the latter prevails.

    Commission on Audit (COA)

    • The Commission on Audit (COA) is empowered by the Constitution to have the exclusive authority to promulgate accounting rules and regulations.
    • COA issues rules and regulations, including State Accounting Standards, to be implemented by all government accountants.

    Government Auditing

    • Government auditing is defined as the analytical and systematic examination and verification of financial transactions, operations, accounts, and reports of government agencies.
    • The purpose of government auditing is to determine the accuracy, integrity, and authenticity of financial transactions, and to classify the requirements of the law, rules, and regulations.

    Accounting Systems

    • Accounting systems are developed by different government agencies and approved by the Department of Budget and Management.
    • The systems are based on COA issuances, including Circular No. 80-6-2-6-3 dated 16 October 1986.

    State Accounting Rules and Regulations

    • All transactions must be supported by sufficient, formal written documents, with a complete and accurate description of the transactions, its peso amount, authorization, and other substantiating information.

    Standard Chart of Accounts

    • The three systems of State accounting use a common Standard Government Chart of Accounts (SGCA) to effect uniformity in accounting and reporting, facility in the consolidation of financial reports, and adaptability to computerization.

    Constitutional Provisions on Accounting and Auditing

    • The Constitution provides for the need of an accounting system that will generate financial reports that reflect a more realistic picture of government operations.
    • The Commission on Audit has the exclusive authority to define the scope of its audit and examination, established the techniques and methods required, and promulgate accounting and auditing rules and regulations.

    Commercial Accounting

    • Commercial accounting is used by the private sector, but applied by government-owned or controlled corporations (GOCCs) with proprietary functions.

    General Principles of Government Accounting

    • Appropriations, allotments, and obligations are governed by specific principles, including:

      • No money should be paid out of the treasury except in pursuance of an appropriation law or other specific statutory authority.
      • Government funds shall be spent only for public purposes.
      • Allotments are to be released to the agencies on a comprehensive basis allocated on a quarterly requirement.
      • The accrual basis of accounting for expenditures should be followed.
      • Expenses whether paid in cash or on account must pass the obligation accounts.
      • Obligations should be properly recorded in the pertinent books of accounts.

    • Disbursement is governed by specific principles, including:

      • All disbursements shall be made only for duly authorized expenditures and on the basis of duly approved and supported disbursement vouchers.
      • All disbursements made from the national treasury shall only be on the basis of the notice of cash allocation issued by the DBM, except when it is otherwise provided by law.
      • Cash, checks, and accountable forms must be kept in safe custody.
      • Cash books of disbursing officers should be kept up-to-date, footed, balanced, and ruled at the end of each month.

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    Description

    This quiz covers the rules and regulations of state accounting, including the use of formal written documents and the Standard Government Chart of Accounts.

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