COA Circular on PPSAS Ficial Reports

Legal basis and related issuances

The circular is issued in light of the government-wide Unified Accounts Code Structure (UACS), prescribed under COA-DBM-DOF Joint Circular No. 2013-1 dated August 6, 2013.
The circular ties UACS object codes to the Revised Chart of Accounts for National Government Agencies under COA Circular No. 2013-002 dated January 30, 2013, as amended by COA Circular No. 2014-003 dated April 15, 2014.
The adoption of 25 Philippine Public Sector Accounting Standards (PPSASs) is based on COA Resolution No. 2014-003 dated January 24, 2014, effective January 1, 2014.
The circular uses International Public Sector Accounting Standards (IPSASs) as the basis of PPSASs, including their transitional guidance.
The circular aligns with COA DBM Joint Circular No. 2014-1 dated July 2, 2014 on Budget and Financial Accountability Reports (BFARs) and the deadlines for BFAR uploading.
The circular adopts the UACS fund clusters and fund codes from the UACS Manual under DBM-COA-DOF Joint Circular No. 2013-1, as amended by DBM-COA-DOF Joint Circular No. 2014-1 dated November 7, 2014.

Policy purpose and rationale

The circular provides guidelines for producing PPSAS-compliant financial statements and related reports for CY 2014 and onwards.
The circular provides the coding structure to be used for CY 2014 financial statements in accordance with the UACS.
The circular provides transitional implementation rules for PPSAS adoption using IPSAS transitional provisions.
The circular supports harmonized monitoring of budget information and preparation of budget and accounting reports through UACS-aligned forms and registries.

Coverage and entities covered

The circular covers National Government Agencies (NGAs) and Government-Owned and/or Controlled Corporations (GOCCs) maintaining Special Accounts in the General Fund (SAGF).
The circular treats NGAs and GOCCs maintaining SAGF as the “entities” to which the rules apply.
The circular allows NGAs and GOCCs to be presented as a group of NGAs and GOCCs combined as a single entity, including central and regional offices with their operating units.
The circular states that GOCCs not maintaining SAGF and Local Government Units (LGUs) are covered by separate guidelines.
The circular requires implementation rules for CY 2014 financial statements and the PPSAS transitional provisions.

Key definitions for circular use

“Entities” means NGAs and GOCCs maintaining SAGF; it may include a combined group of NGAs and GOCCs as a single entity (e.g., central and regional offices and their operating units).
“NGAs” refers to government units including a department, bureau, office, and instrumentality.
“GOCCs” refers to agencies organized as stock or nonstock corporations, vested with functions relating to public needs, and owned by the Government of the Republic of the Philippines directly or through its instrumentalities, wholly or (for stock corporations) to the extent of at least a majority of outstanding capital stock.
“Fund cluster” refers to an accounting entity for recording expenditures and revenues associated with a specific activity for which accounting records are maintained and periodic financial reports are prepared.

Financial statements, reports, and reporting channels

PPSAS 1 governs the components of financial statements: Statement of Financial Position, Statement of Financial Performance, Statement of Cash Flows, Statement of Changes in Net Assets/Equity, Statement of Comparison of Budget and Actual Amounts, and Notes to Financial Statements (summary of significant accounting policies and other explanatory notes).
For the AFR and annual audit reports (AARs) for CY 2014, all NGAs must submit to COA Auditors and the Government Accountancy Sector (GAS), COA the detailed financial statements and trial balances consolidated by fund cluster for the following funds:
- Regular Agency Fund
- Foreign Assisted Projects Fund
- Special Accounts - Locally Funded/Domestic Grants Fund
- Special Accounts - Foreign Assisted/Foreign Grants Fund
- Internally Generated Funds
- Business Related Funds
- Trust Receipts/Inter-Agency Transferred Funds (IATF)
NGAs must upload the soft copies of the required financial statements at the COA website (coa.gov.ph).
GOCCs (including NTA and PCA) must submit to COA Auditors and GAS the trial balances and financial statements for SAGF as required by law, and must upload the soft copies at the COA website.
BFARs prescribed under COA DBM Joint Circular No. 2014-1 dated July 2, 2014 must be submitted to GAS, COA and as COA Auditor, in addition to the financial statements and reports.
NGAs must also upload BFARs at the COA website following the deadlines prescribed in COA-DBM Joint Circular No. 2014-1 dated July 2, 2014.

UACS coding and forms/registries

Fund clusters and fund codes under the UACS Manual (from DBM-COA-DOF Joint Circular No. 2013-1, amended by DBM-COA-DOF Joint Circular No. 2014-1 dated November 7, 2014) must be used.
Upon the circular’s effectivity, NGAs—including NTA and PCA for SAGF—must use/maintain revised forms and registries to facilitate monitoring and preparation of budget and accounting reports, including:
- Obligation Request and Status (ORS)
- Budget Utilization Request and Status (BURS)
- Registry of Revenue and Other Receipts (RROR)
- Registry of Appropriations and Allotments (RAPAL)
- Registry of Allotments, Obligations and Disbursements (RAOD)
- Registry of Budget, Utilization and Disbursements (RBUD)
The circular requires the Statement of Management Responsibility (Appendix A) to be attached to the financial statements.
A basic model or pro-forma Notes to Financial Statements must be included in the Government Accounting Manual (GAM) to guide preparers.

Specific CY 2014 submission rules

NGAs must prepare and submit for CY 2014 one set of financial statements for all funds (combined all funds) as their general purpose financial statements, covering the financial statement components under the PPSAS 1 framework.
NTA and PCA must submit the SAGF financial statements according to the SAGF submission requirement for GOCCs under the circular.
Financial statements (except Notes to Financial Statements) and trial balances must be consolidated at the cluster level for submission using the following cluster groupings:
- Regular Agency Fund consisting of:
  - General Fund - New General Appropriations
  - General Fund - Continuing Appropriations
  - General Fund - Supplemental Appropriations
  - General Fund - Automatic Appropriations
  - General Fund - Unprogrammed Funds
- Foreign Assisted Projects Fund consisting of:
  - General Fund - New General Appropriations
  - General Fund - Continuing Appropriations
  - General Fund - Unprogrammed Funds
- Special Accounts - Locally Funded/Domestic Grants Fund
- Special Accounts - Foreign Assisted/Foreign Grants Fund
- Internally Generated Funds (Off-Budgetary Funds - Retained Income Funds)
- Business Related Funds
- Trust Receipts/Inter-Agency Transferred Fund (IATF)
- Receipts Deposited with the National Treasury other than IATF
- Receipts Deposited with Authorized Government Depository Banks (AGDB)
All financial statements and trial balances must be submitted to GAS, COA and the Agency as COA Auditor on or before February 14, 2015, for the CY 2014 AFR and annual audit reports.
Printed copies of the detailed financial statements (Annexes A1, B1 and C1) must be submitted to GAS, COA, and electronic copies must be uploaded to the COA website.

ORS, BURS, and required budget registries

For ORS (Obligation Request and Status) (Annex F), NGAs must use the ORS for:
- Regular Agency Fund
- Foreign Assisted Projects Fund
- Special Accounts - Locally Funded/Domestic Grants Fund
- Special Accounts - Foreign Assisted/Foreign Grants Fund
The ORS must be prepared by the Requesting/Originating Office based on the approved budget allocation per General Appropriations Act (GAA) and other budget laws/authority.
The ORS must indicate the Funding Source Code segmented by Fund Cluster, Fund Authorization, Major Final Output, Program/Activity/Project, and Major Programs/Projects on the face of the ORS using the UACS Object Code.
The ORS Section C must serve as a subsidiary record maintained by the Budget Unit and must contain amounts of obligations, actual disbursements/payments, and balances of due and demandable obligations and not yet due and demandable obligations.
For BURS (Budget Utilization Request and Status) (Annex G), NGAs must use the BURS for:
- Special Accounts - Locally Funded/Domestic Grants Fund, specifically for income collections of agencies constituted as special accounts
- Internally Generated Funds
- Business Related Funds
- Trust Receipts/IATF
The BURS must be prepared by the Requesting/Originating Offices based on approved budget allocations for off-budgetary and custodial funds.
The BURS Section C must serve as a subsidiary record maintained by the Budget Unit and must contain amounts of budget utilizations, actual disbursements/payments, and balances of due and demandable utilizations and not yet due and demandable utilizations.
RROR (Annex H, H1-H4) must be kept by the Budget Unit and maintained by fund cluster as provided for cluster-based consolidation.
RAPAL (Annex I) must be maintained to monitor the balance of unreleased appropriations for:
- Regular Agency Fund
- Foreign Assisted Projects Fund
- Special Accounts - Locally Funded/Domestic Grants Fund
- Special Accounts - Foreign Assisted/Foreign Grants Fund
RAOD (Annex J) must be used to monitor unobligated allotments and unpaid obligations (due and demandable obligations and not yet due and demandable obligations) for:
- Regular Agency Fund
- Foreign Assisted Projects Fund
- Special Accounts - Locally Funded/Domestic Grants Fund
- Special Accounts - Foreign Assisted/Foreign Grants Fund
RBUD (Annex K) must be maintained to monitor unutilized budget and unpaid utilizations (due and demandable utilizations and not yet due and demandable utilizations) for:
- Special Accounts - Locally Funded/Domestic Grants Fund, speci
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