Barangay budgetary process

* Aside
from
being
a
financial
plan,
the
barangay
budget
serves
as
an
instrument
for
barangay
officials
to
effectively
manage
the
development
of
the
barangay
.
A
well-‐prepared
barangay
budget
serves
as
basis
for:
1. •
Planning
and
policy
adoption
2. •
Program
and
project
implementation
3. •
Financial
control
4. •
Management
information

Sections
329-‐334
(Barangay
Budget)
of
the
Local
Government
Code
of
1991
(RA
No.
7160)
provide
the
basis
for
the
collection,
safekeeping
and
use
of
barangay
funds.
The
aforesaid
provisions
govern
the
preparation,
effectivity,
and
review
of
the
barangay
budget,
including
the
financial
procedures
that
the
barangay
shall
observe.

The
budget
process
at
the
barangay
level
follows
a
similar
process
as
in
the
other
levels
of
local
government
units.
The
budget
process
is
a
cycle
that
consists
of
the
following
phases:
1. •
budget
preparation
2. •
budget
legislation
or
authorization
3. •
budget
review
4. •
budget
execution
and
5. •
budget
accountability.

The
different
phases
overlap
with
each
other
within
a
budget
year.
While
the
budget
of
a
current
year
is
being
implemented,
the
barangay
should
also
prepare
the
budget
for
the
succeeding
year.
Also
within
a
budget
year,
the
barangay
should
prepare
and
submit
accountability
reports
for

Budget
Preparation
Who
prepares
the
barangay
budget?
The
Punong
Barangay,
with
the
assistance
of
the
Barangay
Treasurer,
prepares
the
barangay
budget.
What
are
the
components
of
a
barangay
budget?
A
barangay
budget
consists
of
the
following:
1. Estimates
of
income;
and,
2. Total
appropriations
covering
current
operating
expenditures
and
capital
outlays.

Budget
Preparation
cont…
Who
determines
the
estimated
income
to
be
used
as
a
source
of
fund
in
the
budget?
The
Barangay
Treasurer
i s
responsible
for
determining
the
estimated
income
to
be
used
as
a
source
of
fund
in
the
budget.

Budget
Preparation
cont…
When
and
why
should
the
Barangay
Treasurer
submit
to
the
Punong
Barangay
the
detailed
Statements
of
Income
and
Expenditures
of
the
past
and
current
years?
The
Barangay
Treasurer
should
submit
to
the
Punong
Barangay
on
or
before
September
15
of
each
year
the
detailed
Statements
of
Income
and
Expenditures
as
a
basis
for
the
preparation
of
the
budget
for
the
next
fiscal
year.

Budget
Preparation
cont…
What
forms
part
of
the
beginning
balance
of
the
estimated
income
for
the
budget
year?
Estimated
savings
at
the
end
of
the
current
year
forms
part
of
the
beginning
balance
for
the
budget
year.
It
includes
projected
balances
of
any
appropriation
which
remain
free
of
any
obligation
or
encumbrances
and
which
are
still
available
at
the
end
of
the
current
year
after
the
satisfactory
completion,
or
the
unavoidable
discontinuance
or
abandonment
of
the
work,
activity
or
purpose
for
which
the
funds
were
authorized.

Budget
Preparation
cont…
Is
there
any
penalty
for
a
Punong
Barangay
who
fails
to
prepare
and
submit
the
annual
barangay
budget
on
time?
Pursuant
to
Sec.
318
of
R.A.
No.
7160
and
implemented
by
DBMCOA.
Joint
Circular
No.
93-‐2
dated
June
8,
1993,
a
Punong
Barangay
who
fails
to
submit
the
budget
on
or
before
October
16
of
the
current
year
shall
be
subject
to
such
criminal
and
administrative
penalties
as
may
be
provided
by
the
Local
Government
Code
and
other
applicable
laws.

Budget
Preparation
cont…
What
are
the
mandatory
obligations
that
should
be
provided
in
the
barangay
annual
budget?
The
barangay
annual
budget
must
include
the
following:
1.
Appropriations
for
development
projects
of
not
less
than
20%
of
the
total
IRA
of
the
barangay
for
the
budget
year
(Development
Fund);

Budget
Preparation
cont…
2.
Appropriations
for
Sangguniang
Kabataan
(SK)
programs,
projects
and
activities
equivalent
to
10%
of
the
general
fund
of
the
barangay
for
the
budget
year
(SK
Fund);
3.
Appropriations
for
unforeseen
expenditures
arising
from
the
occurrence
of
calamities
at
5%
of
regular
income
for
the
budget
year
(Calamity
Fund);
and
4.
Provision
for
the
delivery
of
basic
services
pursuant
to
Section
17
of
RA
No.
7160,
and
effective
local
governance.

Budget
Preparation
cont…
How
much
can
be
appropriated
for
personal
services
of
a
barangay?
The
barangay
can
appropriate
not
more
than
55%
of
the
total
annual
income
actually
realized
during
the
next
preceding
fiscal
year
for
personal
services.

Budget
Preparation
cont…
The
illustrative
computation
of
FY
2000
Personal
Services
is
presented
below:
Income
from
regular
sources
realized
during
the
next
preceding
fiscal
year
(1998)
P100,000
x
55%
P
55.000
Less:
Total
PS
Appropriations
P
70,000
Excess
in
PS
Appropriations
P
15,000

Budget
Preparation
cont…
Are
there
cases
when
the
55%
personal
services
limitation
may
be
waived?
Yes.
Excess
over
the
55%
in
personal
services
may
be
waived
if
caused
by
the
implementation
of
EO
No.
332,
whereby
increases
in
honoraria
of
barangay
officials
are
allowed
as
continued
i m p l e m e n t a t i o n
o f
t h e
S a l a r y
Standardization
Law.

Budget
Preparation
cont…
Are
there
collections
which
cannot
be
included
in
the
budget
of
the
barangay?
Yes.
Collections
or
money’s
which
are
held
in
trust,
i.e.,
performance
bonds,
deposits,
payments
under
protest,
and
funds
for
specific
activities
contributed
by
outside
sources
cannot
be
included
in
the
barangay
budget.

Budget
Preparation
cont…
What
is
a
supplemental
budget
and
when
is
it
prepared?
A
supplemental
budget
is
a
financial
plan
authorized
by
a
legislative
body
through
the
enactment
of
an
ordinance
or
law
that
authorizes
the
changes
in
the
annual
appropriation
ordinance
or
law.
It
is
prepared
under
the
following
circumstances:
1.
when
funds
are
actually
available
as
certified
by
the
Barangay
Treasurer;
2.
when
new
revenue
sources
(other
than
those
identified
in
the
annual
budget)
can
support
the
additional
budgetary
requirements;
and
3.
In
times
of
public
calamity.

Budget
Preparation
cont…
Funds are actually available when realized income
exceeds estimated income as of any given day, month
or quarter of the fiscal year. Funds are likewise
deemed actually available when there are savings. For
this purpose, savings refer to portions or balances
as of any given point in the fiscal year of any
programmed or allotted appropriation which remain
free of any obligation or encumbrances and which are
still available after the satisfactory completion or
the unavoidable discontinuance or abandonment of the
w o r k , a c t i v i t y o r p u r p o s e f o r w h i c h t h e
appropriations was originally authorized. Savings may
also result from unobligated compensation and related
cost pertaining to vacant positions and leaves of
absence without pay of local personnel receiving
salaries.

Budget
Preparation
cont…
Can
a
supplemental
budget
be
passed
in
place
of
the
annual
barangay
budget?
No.
Pursuant
to
Sec.
323
of
R.A.
No.
7160,
an
ordinance
authorizing
supplemental
appropriations
shall
not
be
enacted
in
place
of
the
annual
appropriations.
Is
the
provincial/city
and
municipal
aid
to
barangays
limited
to
P1,000
each?
No.
The
aid
to
barangays
in
the
amount
of
not
less
than
P1,000
per
barangay
may
be
increased
subject
to
the
discretion
and
availability
of
funds
of
the
province/
city/
municipality.

Budget
Preparation
cont…
Who
is
entitled
to
a
discretionary
fund
and
for
what
purpose
does
it
serve?
Only
the
Punong
Barangay
is
entitled
to
a
discretionary
fund
to
be
used
for
public
purposes
and
for
other
miscellaneous
expenses
related
to
the
official
functions
of
the
Punong
Barangay.

Budget
Preparation
cont…
How
much
is
the
discretionary
fund
of
the
Punong
Barangay?
The
annual
appropriation
for
discretionary
purposes
of
the
Punong
Barangay
shall
not
exceed
two
percent
(2%)
of
actual
receipts
derived
from
basic
real
property
tax
in
the
next
preceeding
calendar
year.

Budget
Preparation
cont…
Can
a
barangay
set
aside
in
its
budget
a
certain
amount
for
contribution
or
any
fees
that
may
be
requested
by
the
Liga
ng
mga
Barangay?
Yes.
The
amount
can
be
included
in
the
appropriation
for
grants,
donations/
contributions
under
MOOE.
Prior
year
unpaid
contributions
can
also
be
considered.

Budget
Authorization
Who authorizes the barangay budget?
The barangay budget is authorized by the
Sangguniang Barangay, the legislative body
empowered to enact all ordinances pertaining to
the barangay.
How does the Sangguniang Barangay authorize
the barangay budget?
The SB passes the barangay budget
through the enactment of an appropriation
ordinance which shall be approved or ratified by
majority of the SB members.

Budget
Authorization
What
is
an
appropriation
ordinance?
An
appropriation
ordinance
is
the
legislative
instrument
authorizing
the
budget.
When
is
the
effectivity
of
an
appropriation
ordinance?
An
appropriation
ordinance
becomes
effective
only
upon
its
approval
by
majority
of
the
SB
members
and
signed
by
the
Punong
Barangay
on
the
date
fixed
in
the
ordinance.

Budget Authorization
What
happens
if
the
Sangguniang
Barangay
fails
to
enact
an
appropriation
ordinance?
The
ordinance
authorizing
the
appropriations
of
the
preceding
year
shall
be
deemed
reenacted
and
shall
remain
in
force
and
effect
until
the
ordinance
authorizing
the
proposed
appropriations
is
passed
by
the
Sangguniang
Barangay.
However,
only
the
annual
appropriations
for
honoraria
and
salaries/wages
of
barangay
officials
and
employees,
respectively,
statutory
and
contractual
obligations,
and
essential
operating
expenses
authorized
in
the
annual
and
supplemental
budgets
for
the
preceding
year
shall
be
deemed
reenacted.

Can
the
Sangguniang
Barangay
reduce
the
appropriations
in
the
budget
during
the
authorization
phase
of
the
budgeting
process?
Yes.
The
Sangguniang
Barangay
can
reduce
the
appropriations
during
the
authorization
phase
of
the
budgeting
process.

Can
the
Sangguniang
Barangay
increase
the
appropriations
in
the
budget
during
authorization?
Except
when
mandatory
and
statutory
obligations
have
not
been
provided
for
in
the
budget,
in
which
case,
the
increase
may
cover
the
deficiency,
provided
that
the
total
appropriation
does
not
exceed
the
total
estimated
income
reflected
in
the
budget
proposed
by
the
Punong
Barangay.

Does
an
appropriation
ordinance
need
the
approval
of
the
Punong
Barangay?
Yes.
Ordinances
enacted
by
the
Sangguniang
Barangay,
upon
approval
by
the
majority
of
its
members,
need
to
be
approved
and
signed
by
the
Punong
Barangay.
Does
the
Punong
Barangay
vote
on
the
proposed
budget?
The
Punong
Barangay
does
not
normally
vote
on
the
proposed
budget
but
he
may
do
so
only
to
break
a
tie.

Does
the
Punong
Barangay
have
a
veto
power?
No.
This
is
so
because
the
Punong
Barangay
is
also
the
Presiding
Officer
of
the
Sangguniang
Barangay.
However,
he
may
convince
other
members
of
the
Sangguniang
Barangay
from
voting
against
the
appropriations
measure
if
important
items
in
his
original
proposal
are
not
adopted
or
if
these
were
subjected
to
substantial
insertions/
deletions.

Budget Review
Why
is
the
barangay
budget
submitted
for
review?
The
barangay
budget
is
submitted
for
review
to
ensure
that:
1. Budgetary
requirements
and
limitations
provided
in
the
Local
Government
Code
are
complied
with;
2. The
budget
does
not
exceed
the
estimated
receipts
and/or
income
of
the
barangay;
and,
3. The
items
of
appropriations
are
not
more
than
those
provided
by
existing
laws.

Budget Review
When
is
the
barangay
budget
submitted
for
review?
The
appropriation
ordinance,
authorizing
the
annual
or
supplemental
budget
is
submitted
for
review
within
ten
(10)
days
after
its
enactment.
Who
reviews
the
barangay
budget/appropriation
ordinance?
The
Sangguniang
Panlungsod/Bayan,
through
the
City/Municipal
Budget
Officer,
reviews
the
barangay
budget.
The
City/Municipal
Mayor
may
indirectly
review
barangay
budgets
through
the
City/
Municipal
Budget
Officer.

Budget Review
What
is
the
prescribed
period
for
the
review
of
the
barangay
budget?
The
barangay
budget
should
be
reviewed
within
60
days
upon
receipt
of
the
appropriation
ordinance
authorizing
the
barangay
budget
by
the
Sangguniang
Panlungsod/Bayan,
through
the
City
or
Municipal
Budget
Officer.

Budget Review
What
happens
if
the
Sangguniang
Panlungsod/Bayan
fails
to
act
on
the
proposed
barangay
budget
after
the
prescribed
period?
The
budget
is
deemed
in
full
force
and
effect
if
the
Sangguniang
Panlungsod/Bayan
fails
to
review
the
barangay
budget
within
the
60-‐day
period.

Budget Review
What
are
the
effects
of
an
inoperative
budget?
a.
The
budget
shall
be
returned
to
the
Punong
Barangay
for
proper
adjustment/
revisions.
The
Barangay
Treasurer
who
has
custody
of
the
funds
shall
not
make
any
further
disbursements
from
the
inoperative
budget.
b.
The
barangay
operates
on
a
reenacted
budget
or
the
budget
of
the
previous
year
until
the
proposed
budget
meets
the
approval
of
the
Sangguniang
Panlungsod
or
Bayan
to
ensure
the
continuity
of
its
projects
and
activities.

Budget Review
What are the disadvantages of a re-enacted budget?
While a re-enacted budget ensures that barangay
operations will continue despite the absence of a new
budget, it has, however, the following disadvantages:
1. No new projects can be undertaken;
2. New positions cannot be filled;
3. No new equipment's can be acquired;
4. Non-recurring activities, no matter how vital, cannot
be undertaken; and
5. No increase in honoraria and other benefits

Budget Review
What
options
does
the
barangay
have
in
case
of
conflict
in
the
review
of
its
budget
by
the
Sangguniang
Panlungsod/Bayan?
In
case
of
conflict
in
the
review
of
its
budget,
the
barangay
may
take
the
following
courses
of
action:
1. Make
an
appeal
to
the
City/Municipal
Legal
Officer
who
is
assigned
to
review
and
submit
recommendations
on
approved
ordinances
and
executive
orders
issued
by
the
city/municipal
components;
and
2.
Seek
the
technical
assistance
of
the
Department
of
Budget
and
Management
through
its
appropriate
Regional
Office.

Budget Execution
Who is responsible for the
execution of the barangay
budget?
The Punong Barangay is
responsible for the execution of
the barangay budget.

Budget Execution
What are the primary responsibilities of the barangay
officials in implementing the barangay budget?
In implementing or executing the barangay budget,
barangay officials shall ensure the following:
1. That the revenues as estimated are realized;
2. That the approved programs and projects in the
barangay development plan and in the annual budget are
implemented;
3. That barangay funds are disbursed in accordance with
the appropriation ordinance and reviewed annual budget;
4. That all financial transactions of the barangay follow
accounting and auditing rules.

Budget Execution
How is the barangay budget executed?
The barangay budget is executed through the
following procedures:
1. Preparation of a simple cash program for the
quarter
2. Disbursement of funds per cash program;
3. Preparation of requests for obligation of allotment
(ROA);
4. Preparation of disbursement voucher based on
approved ROA;
5. Issuance of checks.

Budget Execution
Who signs the checks for the
barangay?
The Barangay Treasurer
and the Punong Barangay, are
authorized to sign the checks
for the barangay.

Budget Execution
Who
are
the
signatories
in
the
Request
for
Obligation
of
Allotment
(ROA)?
The
ROA
is
signed
by
the
following:
1.
The
Chairman
of
the
Committee
on
Appropriations
of
the
Sangguniang
Barangay,
to
certify
to
the
existence
of
the
appropriation;
2.
The
Barangay
Treasurer,
to
certify
as
to
the
availability
of
funds;
3.
The
City/Municipal
Accountant,
to
certify
as
to
the
obligation
of
allotment.

Budget Execution
Who
are
the
signatories
in
the
Disbursement
Voucher?
The
disbursement
voucher
is
signed
by
the
following:
1. The
Barangay
Treasurer;
2. The
City/Municipal
Accountant;
and,
3. The
Punong
Barangay

Budget Execution
What
principles
govern
the
release
and
disbursement
of
barangay
funds?
Barangay
funds
shall
be
used
judiciously
and
efficiently.
In
this
context,
the
following
principles
must
be
observed:
1. No
money
shall
be
paid
out
of
the
barangay
treasury
except
in
pursuance
of
an
appropriations
ordinance
or
law;
2. Barangay
funds
and
monies
shall
be
spent
soley
for
public
purposes;

Budget Execution
3.
Trust
funds
in
the
barangay
treasury
shall
not
be
paid
out
except
in
fulfillment
of
the
purpose
for
which
that
trust
was
created
or
the
funds
received;
4.
Fiscal
responsibility
shall
be
shared
by
all
barangay
officials
exercising
authority
over
the
financial
affairs,
transactions,
and
operations
of
the
barangays.

Budget Execution
What
are
the
limitations
on
the
disbursement
of
barangay
funds?
Barangay
officials
should
observe
the
following
limitations
in
the
disbursement
of
barangay
funds:
1.
Total
disbursements
shall
not
exceed
actual
collections
plus
50%
of
the
uncollected
estimated
revenue,
provided
there
is
no
cash
overdraft
at
the
end
of
the
year.

Budget Execution
3.
No
cash
advances
shall
be
made
to
any
barangay
official
or
employee
unless
in
accordance
with
accounting
and
auditing
rules
and
regulations.
4.
The
Barangay
Treasurer
may
be
authorized
by
the
Sangguniang
Barangay
to
make
direct
purchases
amounting
to
not
more
than
one
thousand
pesos
(P1,000.00)
at
any
time
for
the
ordinary
and
essential
needs
of
the
barangay.

Budget Execution
Who
shall
keep
custody
of
the
financial
records
of
a
barangay?
The
accounts
and
financial
records
of
all
barangays
in
a
city
or
municipality
shall
be
kept
in
the
office
of
the
Barangay
Treasurer
and
the
City/
Municipal
Accountant.

Budget Execution
What
are
the
financial
records
that
must
be
kept
in
custody?
Financial
records
that
must
be
kept
in
custody
of
the
Barangay
Treasurer
and
the
Municipal
Accountant
are
the
following:
1.
Books
of
accounts
2.
Statements
of
income
and
expenditures
3.
Balance
sheets
4.
Trial
balances

Budget Execution
What
are
the
projects
and
activities
that
may
be
funded
from
the
Local
Government
Service
Equalization
Fund
(LGSEF)?
All
activities
devolved
to
the
barangays
as
enumerated
under
Section
17
(b)
of
R.A.
No.
7160
and
as
determined
by
the
Oversight
Committee
on
Devolution
may
be
funded
from
the
LGSEF.

Budget Execution
From
what
particular
appropriation
item
in
the
budget
can
the
barangays
charge
their
seminar/training
fees?
Training
fees
may
be
charged
against
the
training
and
seminar
expenses
under
Maintenance
and
Other
Operating
Expenses.

Budget Execution
What can the barangay do if their Real
Property Tax share is not actually remitted by
the LGU concerned?
In case of non-remittance of Real Property
Tax share, a barangay may demand for
payment or call the attention of the local
treasurer and the chief executive of the LGU
concerned. If all efforts are denied, the
matter may be referred to higher authorities
like the Bureau of Local Government Finance
(BLGF).

Budget Execution
What
is
the
option
of
the
barangay
if
there
is
a
shortfall
in
income?
In
case
of
revenue
shortfall,
barangay
officials
may
take
the
following
courses
of
action:
a. Prioritize
expenditures
or
spend
only
what
is
necessary;
b.
Intensify
revenue
collections;
c.
Seek
financial
assistance;
and
d.
Resort
to
borrowings.

Budget Execution
Can
the
Municipal
Accountant
refuse
to
sign
the
Statement
of
Income
of
a
barangay
to
support
a
supplemental
budget?
No.
The
Municipal
Accountant
cannot
refuse
to
sign
the
Statement
of
Income
to
support
a
supplemental
budget
unless
the
proposed
income
of
the
barangay
cannot
be
considered
as
a
source
of
fund
for
a
supplemental
budget.
Should
this
happen,
the
matter
can
be
referred
to
the
mayor
for
appropriate
action.

Budget Execution
What
happens
to
the
unexpended
balances
of
appropriation
for
Personal
Services
and
MOOE
at
the
end
of
the
fiscal
year?
Unex p e nd e d
b a l a n c e s
o f
appropriations
for
administrative
purposes
like
Personal
Services
and
MOOE
which
remain
unobligated
at
the
end
of
the
fiscal
year
shall
revert
to
the
general
fund.

Budget Execution
Is it possible to use savings from one
expense item to another without
enacting a supplemental budget?
Yes. The Punong Barangay may by ordinance,
be authorized by the Sangguniang Barangay to
augment any item in the approved annual
budget from savings in other items within the
same expense class, ie. from a personal
services (PS) item to another PS item, or from a
MOOE item to another MOOE item. Hence, use of
savings through augmentation of funds is
allowed without enacting a supplemental
budget.

Budget Execution
Under
a
reenacted
budget,
can
the
barangay
continue
to
pay
the
honoraria
of
Barangay
Health
Workers?
Yes.
Pursuant
to
Sec.
323
of
RA
No.
7160,
the
annual
appropriations
for
honoraria
of
existing
positions
in
the
barangay,
statutory
and
contractual
obligations,
and
essential
operating
expenses
authorized
in
the
preceeding
year’s
annual
and
supplemental
budgets
are
deemed
reenacted.

Budget Execution
How are the IRA shares of barangays
released?
Section 286 of the Local Government Code of
1991 provides that the IRA share of local
government units (LGUs) shall be released
within five (5) days after the end of each
quarter without need of further action or
request. However, in order to facilitate the early
release of the IRA to the barangays, the DBM
has adopted a direct credit system of cash
release to the barangays

Budget Execution
How are the IRA shares released under the
Direct Credit System?
Under the Direct Credit System, the DBM-Regional
Operations and Coordination Service
(DBM-ROCS) prepares the Notice of Cash
Allocations and releases the funding checks for
the month within five (5) days of the ensuing
month to the head offices of the following
government depository banks: Land Bank of the
Philippines (LBP), Development Bank of the
Philippines (DBP), Philippine National Bank
(PNB), and Philippine Veterans Bank (PVB).

Budget Execution
The banks in turn credit the amounts to the
respective current accounts of barangays within
24 hours upon receipt of the funding check.
Unlike in the previous fund release system, the
IRA shares no longer pass through the servicing
banks of DBM ROs and the regional branches of
the banks. This release mechanism ensures the
early receipt by the barangay of their IRA
shares.

Budget Execution
Can the barangay spend the 20%
Development Fund (DF) even if they
failed to submit the AIP on time?
For the 1st quarter of FY 2000, the
Sangguniang Barangay may exercise
discretion on how and where to spend the
20% Development Fund provided, the
result of their decision will be reflected
later on in the AIP.

Budget Execution
Can the 20% Development Fund be
reallocated to other expense items?
No. The fund cannot be reallocated
to other expense items because the
law explicitly states that it shall be
used exclusively for development
projects.

Budget Execution
What is the proper treatment and disposition of
unexpended balances of the 20% Development
Fund?
Unexpended balances of the 20% Development Fund
earmarked for COE, if not booked as accounts payable,
shall revert to the unappropriated surplus and shall
thereafter be appropriated for other development
projects.
Funds for capital outlay projects shall be treated as
continuing appropriations until the projects are
completed or discontinued in which case, the
unexpended balances shall be reverted and
appropriated for other development projects.

Budget Execution
How can the barangay finance big priority
infrastructure projects considering the small
amount of the 20% Development Fund?
The 20% Development Fund is cumulative
which means that small releases may be added
up to finance bigger and better barangay
projects.
Planning and programming the use of the
fund is most essential in this regard.

Budget Execution
How is the 10% Sangguniang Kabataan
(SK) Fund utilized?
As a requisite for the use of the SK fund,
the SK shall develop a plan or a work
program (or a purchase order) which
reflects the projects that they intend to
fund for the year. The plan or work
program must be approved
by the majority members of the
Sangguniang Barangay.

Budget Execution
Should unexpended balances of SK fund be
reverted to the general fund at the end of
the year?
The 10% SK fund is a statutory obligation that
can be considered a trust fund. Therefore, any
unexpended balances shall form part of the
beginning balance of the succeeding fiscal year
but only to be added to the 10% share of the SK
for the next year.

Budget Execution
Can the SK purchase mobile phones for
their official use?
Yes, if it can be justified as very necessary
for SK operations. It is strongly
recommended, however, that guidelines
regarding the payment of bills be
formulated since it is very difficult to
determine whether the calls are official or
not.

Budget Execution
How does the SK utilize funds
generated from fund raising
activities?
Any amount generated by the SK from
fund raising and similar activities may be
disbursed by them with the proper
guidance of the Sangguniang Barangay
but without need of its formal approval.

Budget Execution
How can the barangay utilize the 5%
Calamity Fund?
The Punong Barangay may utilize the
appropriated amount for unforseen
expenditures arising from the occurrence
of calamities, provided that the barangay
has been declared to be in a state of
calamity.

Budget Execution
Who declares when a barangay is
in a state of calamity?
When a calamity occurs, the
Sangguniang Bayan, Panlungsod or
Panlalawigan concerned may declare
the locality in a state of calamity
which will serve as the basis for
utilizing the 5% Calamity Fund.

Budget Execution
Can the barangay augment the calamity
fund if found insufficient when calamities
occurs?
Yes. The Sangguniang Barangay may, by
way of enacting a supplemental budget,
realign appropriations for the purchase of
supplies and materials or for payment of
services which are exceptionally urgent or
absolutely indispensable to prevent
imminent danger to, or loss of life or
property.

Budget Accountability
What is budget accountability?
Budget accountability is the last stage
of the budget process whereby
financial records and reports are
prepared and validated periodically
to assess whether performance is in
accordance with the budget plans.

What accountability reports must be
prepared by the barangays?
All barangays are required to prepare the
following reports:
1. Quarterly Report of Actual Income
(Barangay Budget Accountability Form
No. 300); and
2. Quar terl y Financial Repor t of
Operations (BBA Form 301).

Why do barangays have to keep records and
prepare reports on all budgetary transactions?
Barangay records and reports of budgetary
transactions must be prepared and kept for the
following reasons:
1. To provide information on the status of
project implementation and serve as basis for
the necessary corrective action for identified
deviations.

2. To ensure that obligations are incurred within
the limits of the approved appropriations;
3. To record unpaid obligations, both current
and those certified to as accounts payable at
the end of the year;
4. To make transactions transparent and the
financial status of the barangay a matter of
public knowledge; and
5. To serve as basic input into the next budget
preparation.

Who are responsible for reporting the budget
performance of the barangay?
The following are responsible for reporting the
budget performance of the barangay:
1. Punong Barangay;
2. Chairman of the Committee on
Appropriations of the Sangguniang Barangay;
3. Barangay Treasurer; and
4. City/Municipal Treasurer/Accountant

What must barangay officials report to the
general public regarding the barangay and its
budgetary transactions?
Barangay officials must report the following to
the general public:
1. Income actually realized for the quarter;
2. Expenditures actually spent for the quarter;
and
3. Accomplishments for the quarter.

How are financial operations of a barangay
monitored and why is monitoring important?
# The financial operations of a barangay
shall be monitored by the barangay officials
concerned by comparing the approved
appropriations against actual obligations or
disbursement. Monitoring of the barangay
financial operation is necessary to ensure that
expenditures do not exceed the amount
approved in the appropriation ordinance.

What is the implication of a situation where
collections exceed the revenue targets?
The extra income over and above the estimated
revenues per approved barangay budget can be
certified to as available for a supplemental
budget. This means that some other projects
may be implemented during the year once a
supplemental appropriation ordinance is
enacted.

What is the consequence of disbursing
items of appropriations which were
disallowed in the budget review?
Any official/ employee involved in the
disbursement of funds which have been
previously disallowed in the budget
review may be meted with appropriate
penalty by authorities concerned.

Barangay budgetary process

More Related Content

What's hot (20)

Viewers also liked (20)

Similar to Barangay budgetary process (20)

More from Rafael Paragas (8)

Recently uploaded (20)

Barangay budgetary process