Systems and Procedures Manual on the

Management of Barangay Funds and

Property

Carmen Z. Zafe
State Auditor IV
Government Accountancy and Financial Management
Information System

Learning Objectives:
Understand the policies and
procedures on the operating,
recording and reporting
disbursements of barangay funds
Know the prescribed forms,
summaries and registers to be
prepared/maintained and how they
shall be accomplished
Understand the responsibilities of
the barangay officials

Outline
Definition of Terms
Modes of Disbursements
Basic Policies and Procedures on
Disbursements
Basic Supporting Documents for
Barangay Disbursements
Responsibilities of Accountable Officers

Definition of Terms
Disbursements
refer to all cash paid out
during a given period
settlement of
government expenditures/
payables by cash or by check
represent the movement of
cash from an AGDB or from the
Barangay Treasurer/authorized
disbursing officer to the final

EXPENSES
include
the
amount
actually
issued/expended
for
goods
delivered or services rendered
whether paid or not.

Modes of Disbursements
1. By Check
Commercial checks for
disbursements covered by
deposit with Authorized
Government Depository
Bank (AGDB).

Modes of Disbursements
2. By Cash (thru Barangay Treasurer/AO)
disbursements out of cash
advances given to BT/AO for

personal services and

for specific purpose;
disbursements made by
Petty Cash Custodian out of
his Petty Cash Fund.

Operating Policies on Disbursements

Existing rules and regulations

require that all disbursements of
public funds be supported by
documents necessary to prove
their Validity
Propriety
Legality

Operating Policies on
Disbursements
1. Disbursements by Check
a. All disbursements shall be covered
by duly processed and approved
DVs/payrolls;
b. The DVs/payrolls shall be prepared
by the BRK;
c. The BT shall be responsible for
paying claims against the Barangay;

Operating Policies on
Disbursements
d. All claims shall be approved and
certified by the Punong Barangay
(PB) as to validity, propriety and
legality of the claim. In case of claim
chargeable against SK Fund, the
Chairman, SK shall initial under the
name of the PB.

Operating Policies on
Disbursements
e. Payments shall be drawn against the
depository account maintained with
depository bank by the Barangay;
f. The check shall be issued in the
name of the payee as indicated in
the DV/payroll;
g. The check shall be signed by the BT
and countersigned by the PB;

Operating Policies on
Disbursements
h. In case checks are waylaid, lost
through theft or force majeure, etc.,
the BT shall immediately notify and
issue a Stoppage of Payment
notice to the bank; and
i. Stale check shall be replaced
only when the original is submitted
to the BT for replacement.

The DV shall be numbered

as follows:

07-01-001
Serial number (1st DV - one
series for each year)
Month of Issue (Jan.)
Year (2007)
The DV shall be prepared by the BT/BRK, and shall be
used by the barangay for all money claims. The voucher
number shall be indicated on the DV and on every
supporting document to the claim. The supporting
documents shall be listed on the face of the voucher. In
case more space is needed, the back of the DV shall be
used.

Operating Policies on
Disbursements
2. Disbursements out of cash advance for
payroll

a. Cash payments shall be made out

of the cash advance given to the
BT/AO;
b. The cash advance shall be used
solely for payment of salaries,
honoraria, and other allowances
due the barangay officials and
employees;

Operating Policies on
Disbursements
2. Disbursements out of cash advance for
payroll

c. The cash advance shall not be

used for encashment of checks or
for liquidation of previous cash
advances;
d. The cash advance shall be equal
to the net amount of the payroll for
the pay period;

Operating Policies on
Disbursements
2. Disbursements out of cash advance for
payroll

e.

The cash advance shall be

liquidated within five (5) days after
the end of the pay period.
Any unclaimed honoraria/salaries/
allowances shall be refunded to
close the account;

Operating Policies on
Disbursements
2. Disbursements out of cash advance for
payroll

f. Succeeding cash advance shall be

granted only after full liquidation of
the previous cash advance.

Payroll
January15,
1-15,2007
2006
January
(Period Covered)

Barangay: Simamla
Tel. No.: 811-2318 Barangay Treasurer/AO_________
a

City/Municipality: Virac
Province: Catanduanes
Compensation

No.
1
2
3
4
5
6
7

Name
Josephine Besonia
Asuncion Gianan
Juan Beo
Mario Zuniega
Edwin Taller
Allan Aguilar
Jesus Padilla
Total

Salaries &
Position
Wages - Honoraria
Regular
Brgy. Record Keeper 2,000.00
Utility Worker
500.00
Brgy. Tanod
500.00
Brgy. Tanod
500.00
Brgy. Tanod
500.00
Brgy. Tanod
500.00
Brgy. Tanod
500.00
2,500.00 2,500.00

A Certified: Appropriations exist and

Signature : ______________
Printed name
: Chairman Committee on Appropriations
Position
Date

Signature : ______________
Printed name
Position : Barangay Treasurer
Date
: 1/10/07
1/10/06

funds available for the charges/

expenses indicated above

Certified:
Funds (cash) available

Payroll No. : 07-0106-01-001

001

Deductions
Total
2,000.00
500.00
500.00
500.00
500.00
500.00
500.00
5,000.00

C Certified:

BIR
Withholding Others
Tax

Total

200.00
50.00

200.00
50.00

250.00

250.00

Net
Amount
Due

Signature of
Recipient

1,800.00
450.00
500.00
500.00
500.00
500.00
500.00
4,750.00

D Paid by:

As to validity, propriety, and legality

Approved:
For payment
Signature : ______________
: ________________________Signature : ______________
: ________________________
Printed name
Printed name :
Positon : Punong
: Punong
Barangay
Barangay
Positon: : Barangay
: Barangay
Treasurer
Treasurer
Date
:
Date:
:

Payroll
The Payroll shall be prepared by the
BT/BRK for payment of salaries, wages,
overtime pay, honoraria and other
emoluments of barangay officials and
employees.
This shall be prepared in three (3)
copies to be distributed as follows:
Original basis of payment and to
support the SCP
2nd copy BT
3rd copy BRK

Operating Policies on
Disbursements
3. Disbursements out of cash advance
for travel and special purpose/timebound undertaking

a. For local/foreign travel, liquidation

shall be done within a period of
30/60 days upon return to the
personnels workstation;

Operating Policies on
Disbursements
3. Disbursements out of cash advance
for travel and special purpose/timebound undertaking

b. Cash advance for special purpose/

time-bound
undertaking shall be
liquidated upon accomplishment of the
purpose for which it was granted;

Operating Policies on
Disbursements
3. Disbursements out of cash advance for
travel and special purpose/time-bound
undertaking

c. Excess cash advance shall be refunded

and an OR shall be issued by the BT;
d. The Liquidation Report with appropriate
supporting documents shall be submitted
to the BRK, who in turn shall submit it to
the
City/Municipal
Accountant
for
recording in the books on or before the
5th day of the following month.

Liquidation Report
The LR shall be prepared by the BT/BRK
or concerned accountable officers and
employees in liquidating cash advances for
travel or for special purpose time-bound
undertaking.
It shall be prepared in three (3) copies to
be distributed as follows:
Original City/Municipal Accountant to
support the liquidation of the
cash advance
2nd copy BRK
3rd copy AO

Liquidation Report
Supporting documents for Liquidation
Report shall include:
- Invoices or ORs
In case of cash advance for travel,
supporting documents shall include:
- Plane/bus/boat tickets or equivalent
- Boarding Pass
- Certificate of Appearance
All advances received shall be fully
liquidated before a new one shall be granted.
Full accounting shall be made before
processing a new/additional cash advance.

Operating Policies on
Disbursements
4. Disbursements out of the Petty Cash
Fund

a. The Petty Cash Fund (PCF) shall be

maintained using the Imprest System.
The balance of the PCF shall not be
closed at the end of the year;

b. The
fund
shall
be
kept
separately
from
the regular
collections and advances granted for
a particular purpose and shall not be
used for payment of regular
expenses;

Operating Policies on
Disbursements
4. Disbursements out of the Petty Cash
Fund

c. The amount of the PCF shall be

determined by the SB but not to
exceed 20% of the funds available and
to the credit of the barangay treasury
(Sec. 334 (b) of RA 7160);

Operating Policies on
Disbursements
4. Disbursements out of the Petty Cash
Fund

d. All
disbursements
out
of
PCF
shall
be covered by duly
approved and accomplished Petty
Cash Vouchers (PCV) supported by
cash invoices, ORs or other
evidence of disbursements;

Operating Policies on
Disbursements
4. Disbursements out of the Petty Cash
Fund

e. All paid PCVs shall be reported in

the Summary of Paid PCVs
(SPPCVs) to be certified by the PCF
Custodian (PCFC);
f. The PCF shall be replenished as
soon as disbursements reach 75%
or as needed;

Operating Policies on
Disbursements
4. Disbursements out of the Petty Cash Fund

g. Replenishment of the PCF shall

be made by submitting a DV for
the purpose supported by duly
certified SPPCVs, paid PCVs and
supporting documents.

Operating Policies on
Disbursements
4. Disbursements out of the Petty Cash
Fund

h. In case the PCF Custodian

resigns or ceases as custodian of
the Fund, full accounting/liquidation
of the Fund shall be made. Any
remaining cash shall be refunded to
close the account; and

Operating Policies on
Disbursements
4. Disbursements out of the Petty Cash
Fund

i.

In no case shall the remaining

cash
of
the former PCFC be
transferred to the incoming PCFC.
For a complete accounting, the
account of the former PCFC shall be
closed and a new account shall be
opened for the incoming PCFC.

Petty Cash Voucher

The PCV shall be prepared by the
requesting officials and shall be used for
all disbursements out of the Petty Cash
Fund.
This form shall be prepared in two (2) copies
to be distributed as follows:
Original to support the SPPCV
2nd copy Requesting Official

Basic supporting documents

for barangay disbursements:
1. For payment of salaries/honoraria and
other personal services
a. Approved payroll supported by Daily Time
Record (DTR);
b. Minutes of Meeting of the SB duly signed by
the members of the SB and Barangay
Secretary;
c. Approved application for leave (for leave
with pay);
d. Approved Appointment, Oath of Office;
Certificate of Assumption to Office, and
Statement of Assets and Liabilities for newly
hired employees (for first claim).

Basic supporting documents

for barangay disbursements:
2. For cash advance for payroll
a. Approved payroll for the period
3. For grant of cash advance for
travel
a. Travel Order
b. Itinerary of Travel

Basic supporting documents

for barangay disbursements
4. For payment of maintenance and
other operating expenses

a. Membership Dues

Statement of Accounts/ Bill of the

organization

b. Utility and Communication

Expenses

Bills

Basic supporting documents

for barangay disbursements
c. Repairs and Maintenance Job Orders, Invoices, Certificate
of Warranty/ Guarantee
Pre-repair Inspection Report and Postrepair Inspection Report
Inspection and Acceptance Report (IAR)

Labor Payroll (for repairs undertaken by

administration) or contract (for repairs
undertaken by contract)

Basic supporting documents

for barangay disbursements
5. For purchase of equipment, supplies and
other items (refer to RA 9184)
a. Purchase

Request

b. Purchase

Order

c. Bidding

documents (if through bidding)

d. Suppliers

Invoice

e. Delivery

Receipt or the Receipt portion of

Suppliers Invoice duly signed

f.

Inspection and Acceptance Report

Basic supporting documents for

barangay disbursements
6. For Infrastructure
Projects

and

Reforestation

a. By Contract

Bidding documents

Plan and specifications

Notice of Bidding

Contract

Notice to proceed

Billings of contractors

IAR

Duly verified Contractors Project Accomplishment/

Completion Report

Program of Work

Basic supporting documents for

barangay disbursements
6. For Infrastructure
Projects

and

Reforestation

b. By Administration

Supplies PO, Suppliers Invoice,

Bidding documents or equivalent,
Delivery Receipts and IAR

Wages Labor payroll, DTR and

contract for labor

Plans/Program of Work

Basic supporting documents to

barangay disbursements
7. For Repairs and Maintenance of
PPE
a. Pre-Repair Inspection Report
b. Job Order/Contract
c. Suppliers Invoice
d. Post-Repair Inspection Report
e. IAR

Basic supporting documents to

barangay disbursements
8. Liquidation of cash advances
a. Payroll Fund
paid DVs/payroll
b. Travel

original of the Travel Order

plane/bus ticket or its equivalent
ORs, if any
boarding pass
Certificate of Appearance
Liquidation Report

Basic supporting documents for

barangay disbursements
c. Training Expenses
Certificate of Appearance
Certificate of Training
Invitation to attend the training

Recording Disbursements
To adequately monitor the
accountability of the Barangay
Treasurer/Accountable Officer on the
disbursements of barangay funds,
appropriate documents have to be
submitted to the Barangay Record
Keeper to serve as bases in recording
disbursements in the Registers and in
the preparation of the necessary
reports.

Recording Policies on Disbursements

1. Disbursements by Checks

a. All checks issued, including cancelled

ones shall be recorded by the BT in
correct numerical sequence in the
Summary of Checks Issued (SCkI);
b. Recordings shall be based on the
original paid DVs/Payrolls supported
with carbon copy of the checks issued
and other supporting documents;

Recording Policies on Disbursements

1. Disbursements by Checks

c. Recordings in the SCkI shall be done

by the BT daily;
d. Daily, the SCkI shall be sub-totaled
and the sub-total shall be recorded in
the Cash on Hand and in Bank
Register (CHBReg); and
e. The SCkI shall be submitted to the
Barangay Record Keeper (BRK)
weekly.

Summary of Checks Issued

Original City/Municipal Accountant
2nd copy Barangay Record Keeper
3rd copy Barangay Treasurer
The SCKI shall be prepared by the BT to record
all checks issued for the day. This shall be
submitted to the BRK weekly, supported by
carbon copies of checks issued attached to
original paid DVs/Payroll. Checks issued
including cancelled ones shall be recorded in
correct numerical sequence.

Cash on Hand and in Bank Register

Original City/Municipal Accountant
2nd copy Barangay Treasurer
3rd copy Barangay Record Keeper
The CHBReg shall serve as the cashbook of the
BT where recording of cash transaction is made
daily. The CHBReg shows the total receipts and
deposits, total check disbursements, bank
DMs/CMs and withholding taxes and the daily
balance of cash on hand and in bank. Recording
are based on the certified SCD, SCkI, DMs/CMs
and BnkS.

Recording Policies on Disbursements

2. Disbursements out of cash advance for payroll
a. All payments out of cash advances for
payroll shall be recorded by the BT/AO in
the Summary of Cash Payments (SCP).
b. Recording in the SCP shall be based on
the paid DVs/Payrolls;

Recording Policies on Disbursements

2. Disbursements out of cash advance for payrol
c. To liquidate the cash advance for payroll,
the SCP shall be submitted to the BRK
supported by original paid DVs/Payrolls.
d. Liquidation shall be done within 5 days
after the pay period.

Summary of Cash Payments

Original City/Municipal Accountant
2nd copy BRK
3rd copy BT
The SCP form shall be used by the BT to
record all cash payments made out of cash
advance for payroll. This shall be submitted
to the BRK supported by the original paid
DVs/Payroll. The SCP shall be submitted in
liquidating cash advance for payroll.

Recording Policies on Disbursements

3. Disbursements out of cash advance for travel
and special time-bound undertaking
a. The liquidation of cash advances
shall be by submission of Liquidation
Report (LR) and supporting documents
by the Accountable Officer to the BRK.
b. Copy of LR shall be submitted to the
City/Municipal Accountant by the BRK to
serve as basis in recording the
liquidation in the books.

Recording Policies on Disbursements

4. Disbursements out of Petty Cash Fund
a. All paid Petty Cash Vouchers (PCVs)
shall be recorded in the Summary of Paid
Petty Cash Vouchers (SPPCV) by the PCF
Custodian to report all payments made out
of the PCF;
b. The replenishment of PCF shall be
supported by SPPCV and all original paid
PCVs and supporting documents such as
ORs, invoices,etc.

Recording Policies on Disbursements

4. Disbursements out of Petty Cash Fund
c. The SPPCVs shall be submitted by the
PCF Custodian to the BRK together with
the original paid PCVs and its supporting
documents.
d. The establishment and replenishment of
the PCF shall be recorded by the PCF
Custodian in his Petty Cash Fund
Register.

Recording Policies on Disbursements

4. Disbursements out of Petty Cash Fund
e. The PCFReg shall serve as the petty
cash fund book.
f. Recording of payments in the PCFReg
shall be based on the SPPCV.

Recording Policies on Disbursements

4. Disbursements out of Petty Cash Fund
g.

At yearend, any unreplenished

expenses recorded in the SPPCV
shall be submitted to the BRK for
submission to the City/Municipal
Accountant for recording in the books.

Summary of Paid Petty Cash Voucher

Original attached to DV for
replenishment
2nd copy BRK
3rd copy PCFC
The SPPCV shall be used by the PCFC to
record all paid PCVs. The certified SPPCV
shall be submitted to the BRK with the
original paid PCVs and their supporting
documents for replenishment of the PCF.

Reporting Disbursements

All disbursements shall be

reported to the City/
Municipal Accountant for
recording in the barangay
books.

Reporting Policies on Disbursements

1. Disbursements by Checks
a. The
BRK
shall
record
check
disbursements
in
the
Check
Disbursements Register (CkDReg)
weekly based on the certified Summary
of Checks Issued (SCkI);
b. At the end of each month, CkDReg shall
be totaled, balanced, ruled, recapitulated
and certified; and

Reporting Policies on Disbursements

1. Disbursements by Checks
c. The BRK shall submit the CkDReg
together with the SCkI to the City/
Municipal Accountant on or before
the 5th day of the following month
for recording of the checks issued in
the barangay books.

Reporting Policies on Disbursements

2. Disbursements in Cash

a. Cash advances for payroll shall be

recorded by the BRK in the Cash
Disbursements
Register
(CDReg)
based on the SCkI submitted by the BT.
b. The BRK shall also record the cash
disbursements
in
the
Cash
Disbursements Register (CDReg)
based on the certified Summary of
Cash Payments (SCP).

Reporting Policies on Disbursements

2. Disbursements in Cash

c. At the end of the month, the CDReg

shall be totaled, balanced, ruled and
certified.
d. The BRK shall submit the CDReg to the
City/Municipal Accountant on or before
the 5th day of the following month for
recording of the payments made in the
books and for posting to the SL
maintained for the BT/AO

Reporting Policies on Disbursements

3. Disbursements out of the
Petty Cash Fund

a. The Petty Cash Fund Custodian shall

record disbursements out of PCF in the
PCF Register (PCFReg) based on the
certified SPPCV.
b. At the end of the month, the PCFReg
shall be totaled, balanced, ruled,
recapitulated, certified and submitted to
the BRK;

Reporting Policies on Disbursements

3. Disbursements out of the
Petty Cash Fund

c. The BRK shall submit the PCFReg to the

City/Municipal Accountant to serve as
basis in posting the transaction to the SL
of the PCFC on or before the 5th day of
the following month; and

Reporting Policies on Disbursements

3. Disbursements out of
Petty Cash Fund

d.

The BRK shall also submit the

certified SPPCV for the unreplenished
paid PCVs to the City/Municipal
Accountant on or before 5th day of
Jannuary of the following year to take up
the expenses which remain unrecorded
in the books.

SCP

Workshop
Practice set on
Disbursements