Accounting Finals PDF

ACCOUNTING FINALS **DISHONORED CHECK** - cheques that is drawn declines to pay ("honour") - reason- insufficient cleared funds - non-sufficient funds (NSF) - referred as bad check, dishonored check, bounced check, cold check, rubber check Reasons for not honoring a cheque include: -...

ACCOUNTING FINALS **DISHONORED CHECK** - cheques that is drawn declines to pay ("honour") - reason- insufficient cleared funds - non-sufficient funds (NSF) - referred as bad check, dishonored check, bounced check, cold check, rubber check Reasons for not honoring a cheque include: - account holder instructs bank not to pay the cheque (stopped cheque) the account holder\'s funds are frozen - count not exist due to false cheque - date of cheque is outside period permitted - signature not the same - cheque is damaged **CASH SHORTAGE AND OVERAGE** **Cash over and short** circumstances where there is shortage or overage due to incorrect changes - discovered by cross-checking the cash register and amount of cash receipt - recorded on debit when there is a shortage - recorded on credit when there is overage **SALARY STANDARDIZATION LAW OF 2019 FOR 2020-2023** **Department of Labor and Employment (DOLE) and National Wages and Productivity Commission (NWPC)** mandated to enforce the provisions of the Labor Code of the Philippines **Regional Tripartite Wages and Productivity Board (RTWPB)** monitors economic activities and adjusts minimum wages based on region's growth rate, unemployment rate **COMPUTATION OF SALARY** Conditions of Employment - Normal working hours not exceed (8) hours a day - Payment of overtime addition of **[at least 25%]** of regular wage **per hour** worked or **[30%]** during holidays or rest days - Minimum wage rates for **Agricultural and Non-Agricultural** vary in every region - Minimum age of employment is **18**\-- **15 to 18** work in non-hazardous environments - bankruptcy or liquidation, workers shall be paid their full salary before creditors establish any claim Mandatory Benefits and Contributions - mandated by **Labor Code** to give regular employees 13th month pay = to 1 month of their annual salary - Service incentive leave of at least 5 days with pay for every year of service - Employees have right to **weekly rest period** of **not** **less than 24 consecutive hours** after every 6 work days - Withholding portion monthly salary to remit as contributions to government agencies is a **requisite** for employers, these agencies are as follows: - Social Security System (SSS) - Home Development Mutual Fund (HDMF) - Philhealth - Provision of holiday pay - Paternity and maternity leave benefits 3 different types of parental leaves: 1. maternity leave 2. Paternity Leave all married male employees are entitled to a **7 day paternity leave** for the delivery or miscarriage of his legitimate spouse 3. solo-parent leave. married or not, pregnant employee is entitled to a maternity leave **150 days for a normal delivery** with an additional **15 days for solo parent**, **60 days for miscarriage**, with **[full pay]** and an option to extend for an additional 30 days without pay. **Solo-parent** **employees** described in the Solo Parents Welfare, Republic Act No. 8972 - must have been working for at least a year to be entitled to a solo-parent leave 7 working days of leave in a year De Minimis Benefits include: -- Monetized unused vacation leave credits, maximum of 10 days per year. -- Medical cash allowance, maximum of P750 per semester of P125 per month. -- Rice subsidy, up to P1,500. -- Uniform and clothing allowance, up to P5,000 per year. -- Employee achievement awards (loyalty reward, safety reward...)-- Gifts given for Christmas, special festivities or special circumstances (marriage, illness...) can not be over P5,000 per employee per year. **TAX COMPUTATION** **RA 10963 Tax Reform Acceleration and Inclusion Law (TRAIN Law)** **Tax Identification Number (TIN) ID Card** can use to [open a bank account](https://filipiknow.net/bpi-savings-account/), apply for other government-issued IDs - Only one TIN shall be assigned **BANK RECONCILIATION** - process by which bank account balance in entity's books of account is reconciled to the balance **PROPERTY, PLANT AND EQUIPMENT** Refers to tangible assets that are: - purchased, constructed, developed or acquired - held for use in production or supply of goods - expected to be used for more than one reporting period - not intended for resale in the ordinary course of operations Criteria for Recognition - probable that future economic benefits or service associated with item will flow to LGU - cost or fair value of item can be measured reliably - beneficial ownership and control clearly rest with the government.  **Property, Plant and Equipment** - It includes land, land improvements building and other structures, machinery and equipment, furniture and fixtures, transportation equipment - covers the accounting treatment, recognition, measurement, de recognition to ensure that PPEs are properly valued and recorded. **Carrying Amount** amount which an asset recognized after deducting any accumulated depreciation and losses **Cost** amount of cash equivalents paid and the Fair Value at the time of acquisition **Depreciation** systematic allocation of depreciable of asset **Depreciable Amount** cost of an asset less residual value **Fair Value** amount which an asset could be exchanged and settled **Residual Value** equivalent to at least 5% of the cost of an asset after deducting the estimated costs of disposal **Recoverable Service** **Amount** the higher of a non cash generating asset's fair value **Useful life** period over which an asset is expected to available for use by an entity **[Sample Computation of Property, Plant and Equipment]** The SLSU purchase medical equipment for college of Medicine with estimated useful life of 5 years, One January 2, 2022 with the following data Purchase Price P1,000,000 Delivery Cost 15,000 Dismantling Cost 80,000 Purchase Price P1,000,000 Delivery Cost 15,000 PV of Dismantling Cost [49,674] Total P1,064,674 **[P80,000 X.62092 = 49,674]** **Measurement** acquired through a non-exchange transaction Classification of PPE: **Land**- refers to parcel of lots owned/controlled by the agency - Subsidiary ledger shall be maintained for each parcel of lot. **Land Improvements-** refers to improvements made on the land which include landscaping, fences and hedges, walkways and parking areas. **Infrastructure Assets**- PPEs that usually display some or all of the following characteristics - Part of a system or network - Specialized in nature and do not have alternative uses - Immovable - May be subject to constraints on disposal Classification of Infrastructure Assets **Road Network System** composed of roads, highways and bridges, railways **Flood Control Systems** - public infrastructures composed of seawall, river walls and other flood control system facilities - subsidiary ledgers shall be maintained by type of flood contro **Sewer systems** - composed of the collecting and conducting water waste facility up to the waste treatment plants. - subsidiary ledger for each component of the system **Communication Networks** - covers communication networks such as towers/transmitters/ transceivers and other communication/telecommunication facilities for public use or for income generating purposes. **Water Supply Systems** - collection, transmission, treatment, storage, and distribution of water for homes, commercial establishments, industry, and irrigation **Power Supply Systems** - cover installations for generation and distribution of electricity such as power stations, electric transformers **Seaport Systems** - cover cost incurred in the purchase of ports, lighthouses, harbors and other seaport facilities **Airport Systems** - covers cost incurred in the purchase of landing and taking-off area for aircraft, passenger arrival and departure area, facilities for aircraft maintenance **Parks, Plazas and Monuments** - cover cost incurred in the construction or fair value of parks, plazas and monuments, not classified as Heritage Assets **Buildings and Other Structures**- buildings and structures owned/controlled by agency **Machinery and Equipment**- machineries and equipment owned/controlled by the agency **Transportation Equipment**- vehicles owned/controlled by the agency. **Furniture, Fixtures and Books**- furniture, fixtures and books owned/controlled by the agency **Leased Assets**- PPEs leased by the agency under finance lease **Leased Assets Improvement-** improvements effected by the agency as lessee on its leased PPEs under operating lease. **Construction in Progress-** PPEs in the process of assembly or creation. **Service Concession Assets** provided by operator which the operator constructs, develops or acquires from a third party Modes of Acquisition of PPE **Acquisition** process through which an LGU gains possession or takes over the ownership or control of a particular PPE. - Purchase - Donation - Expropriation - construction - finance lease - or exchange of one or more items for non-monetary assets - a combination of monetary and non-monetary assets. **Right-of-Way (ROW)** - means land secured and reserved to the public for highway purposes. - includes real property acquired for other government public infrastructure projects. - (RA 917 and RA 10752) **Acquisition of Road Right-of-Way (ROW)**. The regular modes of acquisition - Donation - Negotiated Sale - Expropriation **Grants** - assistance in the form of transfer of resources to an LGU from, private sectors or international institutions - Upon receipt of the funds, these are recognized in the Trust Fund books **Receipt, Inspection and Acceptance of PPE** Receipt of items purchased by the LGU shall be accepted by the [Property Officer] **Recording of Deliveries**. Deliveries of PPE upon acceptance shall be recorded in the Property Card **Depreciation** systematic manner of allocating the cost **depreciation charge** for each period shall be recognized as [expense] **Repairs and Maintenance** maintain or improve the functionality and capacity of the PPE - Costs of day-to-day servicing are primarily the costs of labor and consumables, and may include the cost of small parts **Loss of Property** - notify the COA or the Auditor - within thirty days **forms/reports necessary to account for PPE:** **Property Card** used by the Supply and Property Unit (SPU) to record the description, acquisition, transfer **Purchase Request** used by requisitioner to request for the purchase of PPEs items not available on stock. **Purchase Order** prepared by the SPU to support the purchase of PPE, supplies and materials, etc. It serves as the contract between the LGU **Acceptance and Inspection Report** - used to acknowledge receipt of equipment purchased **Property Acknowledgement Receipt** used by the SPU to document the issuance of PPE and the acknowledgement of the end-user. **Report on the Physical Count of Property, Plant and Equipment** used to report physical count and condition of PPE by type as of a given date **Inventory and Inspection Report for Unserviceable Property** used to account for all unserviceable property. It also serves as the basis in dropping **GENERAL OVERVIEW OF RA 9184, PROCUREMENT ORGANIZATIONS &** **The 2016 REVISED IRR** R.A. 9184 applies to **all branches and/or instrumentalities of the government** **Procurement** refers to the acquisition of goods, consulting services, and the contracting **GOODS** All items, supplies and materials Including general support services - Except: Infrastructure projects and consulting services **INFRASTRUCTURE PROJECTS** construction, improvement, demolition, rehabilitation, repair, restoration or maintenance of civil works **CONSULTING SERVICES** projects or activities of the Government requiring adequate external technical and professional expertise **PE** in the best position to determine correct classification of procurement **based on its identified needs** **Motivation or Intention** of the PE in pursuing the project that will determine the primary purpose of a project. **Public Procurement Principles** - Transparency - Efficiency -- Streamlined Procurement Process - Equity -- Fairness - Competition - Accountability - Public Monitoring - Economy -- Value for Money (TEE-CAPE) **5 "Rights" in Public Procurement** Source Quantity Quality Price Time/delivery **PROCUREMENT METHODS** All Procurement shall be done through **[competitive bidding]** except as provided in R.A. 9184. **Procurement ORGANIZATIONS** **Government Procurement Policy Board (GPPB)** central procurement policy making body - quasi-legislative body mandated to formulate and amend the IRR - beyond authority of GPPB to grant exemptions - cannot grant a bidder's request to resolve the issue of their post-disqualification - not vested with the authority to declare a PE's procurement activity - Declaration of failure of bidding is within the authority and accountability of the **[Bids and Awards Committee and the Head of the Procuring Entity]** **GPPB-TSO** technical, research, monitoring and administrative arm of the GPPB **PROCUREMENT ORGANIZATIONS** - Head of the Procuring Entity (HOPE) - Bids and Awards Committee (BAC) - BAC Secretariat - Technical Working Group (TWG) - Observers **HEAD OF PROCURING ENTITY (HOPE)** - Head of the agency or body, or his duly authorized official, for NGAs - Governing Board or its duly authorized official, for GOCCs - Local Chief Executive, for LGUs **FUNCTIONS AND RESPONSIBILITIES:** 1. Establishes BAC and appoints its members 2. Approves the Annual Procurement Plan (APP) 3. Approves/Disapproves the Contract Award 4. Resolves Protests **BIDS AND AWARDS COMMITTEE (BAC)** **FUNCTIONS AND RESPONSIBILITIES:** - *Recommends Procurement Method* - Creates a Technical Working Group (TWG) - *Conducts the bidding activities* - Resolves Requests for Reconsideration - Recommends Imposition of Sanctions - Invites Observers during all stages of the procurement process - Conducts due diligence review or verifications of the qualifications of observers - Prepares Procurement Monitoring Report **MEMBERSHIP AND QUALIFICATIONS:** - occupy **[*plantilla* positions]** - All members are **[regular members]** except the end-user member who is considered as a **[provisional member]** - 5 but not more than 7 MEMBERS designated by the HOPE - **Regular Members:** Chairperson (3rd Ranking Permanent Official) **TERMS OF MEMBERSHIP** - one (1) year only - HOPE may renew or terminate such designation at his discretion. **TECHNICAL WORKING GROUP (TWG)** - legal, technical and financial experts - BAC may create **[separate TWGs]** **OBSERVERS** - represent the [public] - At least three (3) Observers - COA - private group in the sector - Non-Government Organization (NGO) **GRANT OF HONORARIA** PE is authorized to grant honoraria to the members of the BAC, the TWG, and the BAC Secretariat provided the amount so granted **does not exceed twenty-five percent** (25%) of their respective basic monthly salary **RULE XVI -- ALTERNATIVE** **METHODS OF PROCUREMENT** 1. **Limited Source Bidding** -- Direct invitation to pre-selected suppliers or consultants 2. **Direct Contracting** -- Submission of price quotations by selected supplier 3. **Repeat Order** -- Replenishment of goods within 6 mos. from previous winning bidder, 4. **Shopping** -- For unforeseen contingency and ordinary/regular office supplies & equipment to include commodities or supplies 5. **Negotiated Procurement** -- Direct negotiation w/ capable supplier, contractor or consultant