Law Summary
Background on Fund Transfer Mechanism
- Certain agencies' appropriations include CMIs/lump-sum amounts allocated for their Operating Units (OUs).
- If specific OU allocations are known, allotments are released directly by DBM to OUs.
- If specific OUs are not yet determined, allotments go to the agency as per the General Appropriations Act.
- Transfers from agencies to OUs use Sub-Allotment Advice (SAA) or Letter Advice Authority (LAA).
- Two existing cash support methods:
- For SAA: Charged against recipient OUs' NCA or from additional NCAs by DBM.
- For LAA: Agencies issue funding checks to OUs, which deposit checks in current accounts, considered cash drawdown/utilization of Bureau of the Treasury funds.
Discontinuation of Cash Transfer via Funding Checks
- Effective immediately, funding check transfers under LAA are discontinued.
- Agencies with cash balances from funding checks must remit these to the National Treasury by June 30, 2003.
Revised Transfer of Allotment Procedures
- Allotment transfers to OUs shall be made through Sub-Allotment Advice (SAA) only.
- Cash support shall be provided through:
- Additional NCA issued directly by DBM to recipient OUs.
- Notice of Transfer of Allocation (NTA) instructing Modified Disbursement Scheme-Government Servicing Bank (MDS-GSB) to transfer amounts from the agency's NCA book balance to OUs’ MDS accounts.
- The MDS-GSB for OUs must be the same as the transferring agency’s MDS-GSB.
Reporting and Monitoring
- Agencies must provide DBM with reports of transferred allotments and NTAs.
- These reports help determine the adjusted funding levels of the agencies.
Effectivity
- The guidelines are effective immediately as of May 22, 2003.