Revenues and Other

Receipts
 CONTENTS
Fundamental Principles for Revenue
Types of Funds
Sources of Revenue
Other Receipts

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HELLO!
I am Mam Mej

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Fundamental Principles
for Revenue

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 Fundamental Principles for Revenue
a. Unless otherwise specifically provided by law, all revenues
accruing to an entity by virtue of the provisions of existing law,
orders and regulations shall be deposited/remitted in the
National Treasury (NT) or in any duly authorized government
depository, and shall accrue to the General Fund (GF) of the
NG. (Sec. 65(1), P.D. No. 1445)

b. Except as may otherwise be specifically provided by law or

competent authority, all moneys and property officially received by a
public officer in any capacity or upon any occasion must be
accounted for as government funds and government property. (Sec.
42, Chapter 7, Title I(B), Book V, E.O. No. 292)

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 Fundamental Principles for Revenue
c. Amounts received in trust and from business-type activities of
government may be separately recorded and disbursed in
accordance with such rules and regulations as may be determined
by a Permanent Committee composed of the Secretary of Finance
as Chairman, and the Secretary of Budget and Management and
the Chairman, COA, as members. (Sec. 65(2), PD No. 1445)

d. Receipts shall be recorded as revenue of Special, Fiduciary or

Trust Funds or Funds other than the GF, only when authorized by
law as implemented by rules and regulations issued by the
Permanent Committee. (Sec. 66, PD No. 1445)

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 Fundamental Principles for Revenue
e. No payment of any nature shall be received by a collecting officer
without immediately issuing an official receipt in acknowledgement
thereof. The receipt may be in the form of postage, internal revenue
or documentary stamps and the like, officially numbered receipts,
subject to proper custody, accountability, and audit. (Sec. 68(1), P.D.
No. 1445)

f. Where mechanical devices (e.g. electronic official receipt) are

used to acknowledge cash receipts, the COA may approve, upon
request, exemption from the use of accountable forms. (Sec. 68 (2),
P.D. No. 1445)

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 Fundamental Principles for Revenue
g. At no instance shall temporary receipts be issued to acknowledge
the receipt of public funds. (Sec. 72, GAAM Volume I)

h. Pre-numbered ORs shall be issued in strict numerical sequence.

All copies of each receipt shall be exact copies or carbon
reproduction in all respects of the original.(Sec. 73, GAAM Volume
I)

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 Fundamental Principles for Revenue
i. An officer charged with the collection of revenue or the receiving of
moneys payable to the government shall accept payment for taxes,
dues or other indebtedness to the government in the form of checks
issued in payment of government obligations, upon proper
endorsement and identification of the payee or endorsee. Checks
drawn in favor of the government in payment of any such
indebtedness shall likewise be accepted by the officer concerned.

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 Fundamental Principles for Revenue
j. Under such rules and regulations as the COA and the Department
of Finance (DOF) may prescribe, the Treasurer of the Philippines
and all AGDB shall acknowledge receipt of all funds received by
them, the acknowledgement bearing the date of actual remittance or
deposit and indicating from whom and on what account it was
received. (Sec. 70, P.D. 1445)

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Types of Funds
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 Types of Funds

General Fund – a fund which is Trust Fund – fund held by a government agency
available for any purpose other or public officer acting as trustee, agent or
than those which other funds been administrator for the fulfillment of a condition.
designated to.

Special Fund – a fund designated ◉ All money collected for a special purpose
for special purposes. shall be treated as a special fund and paid
out for such purpose only. If the purpose for
which a special fund was created has been
fulfilled or abandoned, the balance, if any,
shall be transferred to the general funds of
the Government.

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 Types of Funds

Depository Fund – fund held in an Special Account in the General Fund (SAGF) -
authorized depository bank over established to facilitate the funding of priority
which the recipient agency retains activities of the government.
control for the lawful purposes for
which the fund was received.

Special Purpose Funds – funds Revenue Fund – comprises all funds derived from
that the President allocates for the income of any government agency and
special programs and projects.. available for appropriation or expenditure in
accordance with the law.

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Sources of Revenue
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 Sources of Revenues

◉ Exchange Transactions are ◉ Non exchange transactions are

transactions in which one transactions in which an entity
entity receives assets or either receives value from
services, or has liabilities another entity without directly
extinguished, and directly giving approximately equal value
gives approximately equal in exchange or gives value to
value to another entity in another entity without directly
exchange. receiving approximately equal
value in exchange.

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 Exchange Transactions
1. Sales of goods or Provisions of Services to third parties or other
government entities.
• Service Income – Permit fees, Registration Fees,
Franchising Fees, Licensing Fees, Legal Fees, Passport and
Visa Fees, Processing Fees and the like.
• Business Income – School Fees, Examination Fees,
Rent/Lease Income, Communication Network Fee, Income
from Hostels/ Dormitories, Sales Revenue, Hospital Fees,
Share in the Profit of Joint Venture and the like.

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 Exchange Transactions
2. Use by other entity of assets yielding interest, royalties and
dividends or similar distributions.
• Interest Income – charges for the use of cash or cash
equivalents, or amounts due to the entity.
• Royalties – fess paid for the use of the entity’s assets such
as trademarks, patents, software and copyrights;
• Dividends – share of National Government from the earnings
of its capital/equity investments in GOCCs and other
entities.

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 Revenue Recognition
1. Sale of goods
• Risk and rewards of ownership of the goods are transferred
to the buyer.
• The entity does not retain continuing managerial
involvement or effective control over the goods sold.
• Revenue can be measured reliably.
• Cost relating to the transactions can be measured reliably

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 Revenue Recognition
2. Rendering of services
• The stage of completion of the transaction at the reporting
date can be measured reliably.
• It is probable that economic benefits will flow to the entity;
• Revenue can be measured reliably.
• Cost relating to the transactions can be measured reliably

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 Revenue Recognition
3. Interest, Royalties and Dividends
• Interest is recognized on a time proportion basis that takes
into account the effective yield on the asset;
• Royalties are recognized as they earned in accordance with
the substance of the relevant agreement;
• Dividends are recognized when the entity’s right to receive
payment is established.
• Cost relating to the transactions can be measured reliably

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 Measurement of Revenue
• Revenue from exchange transactions are measured at the fair
value of consideration received or receivable. Any trade
discounts and volume rebates shall be taken into account.
• Fair value of the goods or services received, adjusted by the
amount of any cash transferred.
• Fair value of the goods or services given up, adjusted by the
amount of any cash transferred.

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 Non – exchange Transactions
1. Taxes – are compulsory payments intended to provide revenue
to the government. Taxes do not include fines and penalties.
2. Fines and penalties – are monetary sanctions received as a
consequence of breach of laws.
3. Gifts, Donations and Goods/Services In-kind – are voluntary
transfers of assets and services that one entity makes to
another, normally free from stipulations.

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 Revenue Recognition
• Revenue from non – exchange transactions are recognized on a
cash basis until a reliable measurement model is developed.

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 Revenue Recogntion
1. Taxes – is recognized at a gross amount.
2. Fines and penalties – are recognized as income in the year they
are collected.
3. Gifts, Donations and Goods/Services In-kind – are recognized
as revenue when it is probable that future economic benefits or
service potential will flow to the entity.

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 Measurement

1. Assets – at the acquisition date fair value

2. Liabilities – at present value, when the effect of time value of
money is material.
3. Revenue – at the amount of increase in net assets.

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 Debt Forgiveness

 When lender cancels the debt of a government entity, the debtor

recognizes revenue to the carrying amount of the debt.

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 Bequests

 Are transfers made according to the provision of a deceased

person’s will.
 A bequest that satisfies the recognition criteria for asset is
recognized as revenue, measured at fair value of the resources
received or receivable.

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 Grant with Condition

 An asset received under a grant with condition is initially

recognized as liability and recognized as revenue only when
the condition is satisfied.

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 Other Receipts

 Receipts of subsidy from the National Government such as receipt

of:
1. Notice of Cash Allocation
2. Tax Remittance Advice
3. Non-cash Availment Authority
4. Cash Disbursement Ceiling

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Other Receipts

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 Other
Receipts

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 Other Receipts
 Receipt of subsidy or assistance from other government agencies
including LGUs and GOCCs
1. Notice of Cash Allocation
2. Tax Remittance Advice
3. Non-cash Availment Authority
4. Cash Disbursement Ceiling

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 Other Receipts
 Receipt of excess cash advance granted to officers and
employees

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 Other Receipts

 Receipts of refund of overpayment of expenses.

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 Other Receipts

 Receipt of performance bond or security deposit.

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 Other Receipts

 Collections made on behalf of another entity.

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 Other Receipts

 Intra agency Fund transfer

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 Other Receipts
 Inter agency Fund transfer

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