CH 1

GOVERNMENT
ACCOUNTING
CHAPTER 1
DEFINITION
– Encompasses the processes of

analyzing, recording, classifying,
summarizing and
communicating all transactions
involving the receipt and
disposition of government funds
and property, and interpreting
the results thereof.
OBJECTIVES
1. To produce information concerning past

operations and present conditions
2. To provide a basis for guidance for future
operations
3. To provide for control of the acts of public
bodies and officers in the receipt, disposition
and utilization of funds and property
4. To report on the financial position and the
results of operations of government agencies
for the information of all persons concerned.
EMPHASIS
A. Sources and utilization of government funds

B. Responsibility, accountability and liability of entities
entrusted with government funds and properties
Accounting
Responsibility
The following offices are charged with
government accounting responsibility:
A. COA (Commission on Audit)
B. Department of Budget and Management
(DBM)
C. Bureau of Treasury (BTr)
D. Government agencies
Main concept
– Government resources must be utilized

efficiently and effectively in accordance with
the law. Government officials are responsible
in implementing this policy, are accountable
for the government resources in their custody
and are liable for any loss.
COA
A. Has the exclusive authority to promulgate

accounting and auditing rules and
regulations
B. Keeps the general accounts of the
government, supporting vouchers and other
documents
C. Submits financial reports to the President
and Congress
DBM
– Responsible for the formulation and

implementation of the national budget with
the goal of attaining the nation’s socio-
economic objectives
Bureau of Treasury
(BTr)
Functions under the Dept of Finance and is the
cash custodian of the government. The BTr is
authorized to:
a. Receive and keep national funds and manage
and control the disbursements thereof; and
b. Maintain accounts of financial transactions
of all national government offices, agencies
and instrumentalities
Government Agencies
– Government agency refers to any department, bureau or office of the national

government, or any of its branches and instrumentalities, or any political
subdivision, as well as any government owned or controlled corporation
(GOCC), including its subsidiaries, or other self-governing board or commission
of the government.
Financial reporting system of
the National Government
Entity- refers to a government agency,

department of operating/field unit.
Financial Reporting- is the process of
preparation, presentation and submission of
general purpose financial statements and other
reports. The objective of financial reporting is to
provide information about the entity that is
useful to users for accountability purposes and
decision-making.
The GAM for NGAs
– An “old” government accounting system had been used for about five decades
before it was replaced by the New Government Accounting System (NGAS) in
2002.
– In January 1, 2016 the NGAS was replaced by the Government Accounting
Manual for National Government Agencies (GAM for NGAs).
Legal basis
– The GAM for NGAs is promulgated by the COA

(Commission on Audit) based on the authority conferred
to it by the Philippine Constitution.
– Relevant provision of Law:

The COA shall have exclusive authority, subject to the
limitations in this Article, to define the scope of its audit &
examination, establish the techniques and methods required
therefor, and promulgate accounting and auditing rules and
regulations, including those for the prevention and
disallowance of irregular, unnecessary, excessive, extravagant
or unconscionable expenditures, or uses of government funds
and properties.- Philippine constitution
Coverage
The GAM for NGAs provides the basic concepts to be used in:
A. Preparing general purpose financial statements in
accordance with the Philippine Public Sector Accounting
Standards (PPSAS) and other financial reports as may be
acquired by laws, rules and regulations and
B. Reporting of budget, revenue and expenditure in
accordance with laws, rules and regulations
Objective
– The GAM for NGAs aims to update the following:

a. Standards, policies, guidelines and procedures in
accounting for government funds and property
b. Coding structure and accounts and
c. Accounting books, registries, records, forms, reports and
financial statements
Basic Accounting & Budget
Reporting Principles
1. Philippine Public Sector Accounting Standards (PPSAS) and

relevant laws, rules and regulations
2. Accrual basis of accounting
3. Budget basis
4. Revised chart of accounts prescribed by COA
5. Double entry bookkeeping
6. FS based on accounting & budgetary records
7. Fund cluster accounting
Qualitative Characteristics of
Financial Reporting
1. Understandability
2. Relevance
3. Materiality
4. Timeliness
5. Reliability
6. Faithful Representation
7. Substance over
8. Neutrality
9. Prudence
10. Completeness
11. Comparability

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GOVERNMENT

– Encompasses the processes of

1. To produce information concerning past

A. Sources and utilization of government funds

– Government resources must be utilized

A. Has the exclusive authority to promulgate

– Responsible for the formulation and

– Government agency refers to any department, bureau or office of the national

Entity- refers to a government agency,

– The GAM for NGAs is promulgated by the COA

– Relevant provision of Law:

– The GAM for NGAs aims to update the following:

1. Philippine Public Sector Accounting Standards (PPSAS) and

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