1 Unified Accounts Code Structure: What are its benefits to Public Financial Manager? 1 PAGBA Convention, Sarabia Manor Hotel, Iloilo City April 5, 2013.

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Unified Accounts Code Structure: What are its benefits to Public

Financial Manager?

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PAGBA Convention, Sarabia Manor Hotel, Iloilo CityApril 5, 2013

ContentA. Introduction

What is Public Financial Management (PFM)? PFM System Weaknesses Overview of PFM Reform Roadmap

B. Budget Reporting and Performance Standards Project Key PFM Reform Projects Meaning and Purpose of Unified Accounts Code

Structure (UACS) Key Elements of the UACs

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What is PFM? Public Financial Management (PFM) is a system of rules,

procedures and practices for government to manage public finances in the areas of:

budgeting accounting auditing cash management management of public debt revenue generation public reporting on public sector financial operations

budget not results based

lack of funding predictability

weak oversight of Congress and publiclack of efficient cash management

management

messy traffic of documents

monitoring of contingent liabilities

lack of budget credibility

PFM Gaps in the Budget Process

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Facilitate the development of GIFMIS

GAP/WEAKNESS

Lack of a common classification system for budgeting, accounting, auditing and cash management

Revise New Government Accounting System (NGAS) Manual and chart of accounts

Consolidated FM reporting requirements based on harmonized classification of all accounts

Real-time reports, access to financial data and control of obligations and disbursements for more effective financial control and accountability

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Harmonize budgetary and accounting classifications and reporting

Codify PFM rules and complete PFM Rules Manual for capacity building

Identify common reporting requirements of oversight agencies and line departments

GAP/WEAKNESS

Lack of a common classification system for budgeting, accounting, auditing and cash management

Identify common reporting requirements of oversight agencies and line departments

Key PFM Gaps and Strategies

Financial Reporting

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This is now… In the long run, the Philippine PFM needs this kind of information system

PFM Reform Roadmap Master plan for modernizing the

financial management system of the government

Executive Order 55 (s. 2011) directing the integration and automation of PFM systems:

Government Integrated Financial Management Information System (GIFMIS)

Treasury Single Account (TSA)

Efficient Budget Release System

Systematic Financial and Physical Reporting and Auditing

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Budget Reporting and Performance Standards Project

Objectives• Harmonize and consolidate data structures and apply consistent set of

budget and accounting rules for reporting• Generate real-time reports on budget utilization and financial performance

through GIFMIS (long term)• Consolidated and agency level budget execution and budget utilization

reports published in COA and DBM websites

Key Activities • Formulation of Unified Accounts Code Structure to harmonize budgetary

classifications and chart of accounts • Harmonized DBM and COA financial reporting forms • Formulation of performance standards initially with restructuring of

programs/activities/projects (NBC 532) and issuance of OPIF Reference Guide

• Glossary of PFM Terminologies

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Fiscal Simulation

Budget Preparation

Budget Management Budget Execution

Commitment Management

Payments Management

Receipts Management

Cash Management

Accounting & Fiscal Reporting

Asset Management

Procurement(PhilGEPS)

Debt Mgmt(DMFAS)

Human Resources Management

Payroll(NPS)

Plantilla(GMIS)

Revenue Management

Customs (BOC)

Internal Revenue (BIR)

Auditing Mgmt (IRRBAS)

Securities Management

GIFMIS

DataWarehousing

Business Intelligence

Government EIS(GEIS)

Central Bank &

Government Servicing

Banks(TSA)

Commercial Banks

CreditorVendor/Supplier

Public Employee

Portal

User

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UACS

UACS

UACS

UACS

UACS

UACS

UACS

UACS

UACS

UACS

UACS

UACS

The Unified Accounts Code Structure (UACS) – “The Backbone

of GIFMIS”

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A government wide, harmonized budgetary and accounting code classification that will facilitate financial reporting

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Unified Accounts Code Structure

Enable reporting of actual revenue collections and expenditures against programmed revenues and expenditures

Enable the comparison of: allotment releases vs. appropriations, obligations vs. releases, and actual disbursements vs. obligations for

programs/projects/activities of spending agencies

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Purpose of the UACS

Contains the accounts and codes to be adopted in:

identifying aggregating budgeting accounting auditing, and reporting the financial transactions of the government

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UACS Manual

Financial reports as required by the Department of Budget and Management and the Commission on Audit;

Financial Statements as required by the Public Sector Accounting Standards Board of the Philippines;

Management reports as required by heads of departments/agencies; and

Economic Statistics consistent with the Government Finance Statistics Manual 2001

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Reporting Requirements Supported by UACS

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UACS Structure

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UACS Structure

Funding Source Segments

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Funding Source6 Digits

Financing Source1 digit

1st

Authorization2 digits

2nd & 3rd

Fund Category3 digits

4th to 6th

Funding Source: Financing

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Financing and Authorization Codes

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Funding Source: Fund Category

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Particulars Financing Autho Fund Cat =

Funding Source Code

General Fund 1 New General Appropriation 01 Agency Specific Budget 101 101101 Misc. Personnel Ben Fund 406 101406

Automatic Appropriation 04 RLIP 102 104102

Special Account in the Gen. Fund

DPWH-Special Road Support Fund 346 104346

Combined Funding Source Code

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UACS Structure

Department – the primary subdivision of the Executive Branch responsible for the overall management of a sector or a permanent national concern with nationwide or international impact– headed by a Secretary or an official with an equivalent position level For purposes of the UACs, Constitutional Offices, the Judiciary and the Legislature are categorized as Department-level entities.

Agency – refers to any of the various units of the Government, including an office, instrumentality, or GOCC, that may not approximate size of a Department but which nevertheless performs tasks that are important and whose area of concern is nationwide in scope

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Organization Code Segments

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Organization Code Segments

Lower-Level Operating Unit -organizational entities charged with carrying out specific substantive functions or with directly implementing programs/projects of a department or agency, such as line bureaus, field units

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Organization Code Segments

Organization Code12 Digits

DEPARTMENT2 digits

AGENCY3 digits

LOWER-LEVEL OPERATING

UNIT7 digits

Department Code

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DEPARTMENT UACSCongress of The Philippines 01 Office of The President 02 Office of The Vice-President 03 Department of Agrarian Reform 04 Department of Agriculture 05 Department of Budget and Management 06 Department of Education 07 State Universities and Colleges 08 Department of Energy 09

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DEPARTMENT UACS Department of Environment and Natural Resources

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Department of Finance 11 Department of Foreign Affairs 12 Department of Health 13 Department of the Interior and Local Government 14 Department of Justice 15 Department of Labor and Employment 16 Budgetary Support to Government Corporations 35 Financial Assistance to Metropolitan Manila Development Authority

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Department Code

Agency Code

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DEPARTMENT/AGENCY UACS Department of Budget and Management 06 000 0000000 Office of the Secretary 06 001 0000000 Government Procurement Policy Board-Technical Support Office

06 002 0000000

Lower-Level Operating Unit

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DEPARTMENT/AGENCY/OPERATING UNIT

UACS

Department of Budget and Management 06 000 0000000 Office of the Secretary 06 001 0000000 Central Office 06 001 0100000 Regional Office – I 06 001 0300001 Regional Office – NCR 06 001 0300013 Regional Office – CAR 06 001 0300014 Regional Office - II 06 001 0300002 Regional Office - III 06 001 0300003 Government Procurement Policy Board-Technical Support Office

06 002 0000000

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Examples of Operating Units Classification

LOWER-LEVEL OPERATING UNITS CLASSIFICATION UACSCentral Office 01Staff Bureaus 02Regional Offices/Centers for Health Development 03Sub-Agency 04Provincial Offices 05National Irrigation Administration Offices 06Schools Division/District Offices 08Secondary Schools 09Revenue Regional Offices 11District Engineering Offices and Sub District Engineering Offices

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Organization Code Segments

Sample Organization Code06 001 03 00000

12 Digits

DEPARTMENTOLD DBMUACS 06

(2 digits)

AGENCYOLD OSEC-DBMUACS001

(3 digits)

LOWER-LEVEL OPERATING UNIT

OLD Central Office(Activity)UACS03 00000

(7 digits)

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Organization Code Segments

DEPARTMENT AGENCY

LOWER LEVEL

OPERATING UNIT

UACS

From: Department of Education

07

National Book Development Board (NBDB)

002

000000007 002

0000000

To:Department of Trade and Industry

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National Book Development

Board

0070000000

22 007 0000000

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Organization Code Segments

DEPARTMENT OF TRADE AND INDUSTRY 22 000 00 00000

Office of the Secretary 22 001 00 00000

Board of Investments 22 002 00 00000

Construction Industry Authority of the Philippines 22 003 00 00000

Construction Manpower Development Foundation 22 004 00 00000

Philippine Trade Training Center 22 005 00 00000

Product Development and Design Center of the

Philippines

22 006 00 00000

National Book Development Board 22 007 00 00000

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UACS Structure

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Location Code Segments

Location Code9 Digits

Region2 digits

Province2 digits

City/Municipality

2 digits

Barangay3 digits

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Region CodeREGION UACS

Region I – Ilocos 01Region II – Cagayan Valley 02Region III – Central Luzon 03Region IV-A – CALABARZON 04Region IV-B – MIMAROPA 17Region V – Bicol 05Region VI – Western Visayas 06Region VII – Central Visayas 07Region VIII – Eastern Visayas 08Region IX – Zamboanga Peninsula 09Region X – Northern Mindanao 10Region XI – Davao 11Region XII – SOCSKSARGEN 12Region XIII – CARAGA 16National Capital Region 13Cordillera Administrative Region 14Autonomous Region in Muslim Mindanao 15

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Province Code

  PROVINCE UACSCAR - Cordillera Administrative Region  Abra 01  Apayao 81  Benguet 11  Ifugao 27  Kalinga 32  Mountain Province 44

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Municipality Code

  MUNICIPALITY UACSCAR - Cordillera Administrative Region 140000000  Abra 140100000  Bangued 140101000 

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Location Code

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UACS Structure

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MFO/PAP Code Segments

MFO/PAP Code9 Digits

Program

1st digit

MFO

2nd – and 3rd digits

Activity Code

1st Level4th - and 5th digits

2nd Level6th – to 9th digits

Project

1st digit

Project Category

2nd – and 3rd digits

Sub-Category

4th - and 5th digits

Project Title

6th – to 9th digits

Purpose (SPF)

1st digit

Activity Code

2nd – and 3rd digits 4th - and 5th digits 6th – to 9th digits

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PAP Category

Programs, Projects or Purpose UACS General Administration and Support (GAS)

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Support to Operations (STO) 2 Operations 3 Locally-Funded Projects 4 Foreign-Assisted Projects 5 Purpose 6

Physical Infrastructure Projects Includes Buildings, Flood Control, Roads and Bridges,

Other Transport Infrastructure, Water Management and Power and Communications Infrastructure

Non Physical Infrastructure ProjectsIncludes Economic Development, Education, Environmental

Protection, Governance, Health, Recreation Sports and Culture, Research and Development and Social Protection

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Project Category and Sub-Category

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Project Category and Sub-Category

Governance 1000

General Public Services 1001

Defense 1002

Public Order and Safety 1003

Systems Development 1004

Capacity Development 1005

Governance and Accountability Improvement 1006

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DBM – Old PAP Structure

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DBM – Old PAP Structure

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MFO/PAP Coding Example

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MFO/PAP coding example

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MFO/PAP coding example

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UACS Structure

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Object Code Segments

Object Code10 Digits

COAChart of Accounts

Object8 digits

Sub-Object2 digits

Substantially revised to consolidate some line items, add clarity to overall structure and to facilitate compliance with the Philippine Public Sector Accounting Standards (PPSAS)

Moved away from the 3-digit coding framework (2003) to an 8-digit framework (2012)

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Description CoA Assets 1 Liabilities 2 Equity 3 Income 4 Expenses 5

Object Code

Every item on the COA CoA included Sub codes added to meet DBM, BTr, DoF,

COA and GFS reporting requirements Capital Outlay codes added in

correspondence with relevant COA CoA

asset codes Some Lump Sum codes added for use prior

to transfer to Departments

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Object Code

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Starting Point – COA Chart of Accounts

5 Expenses5 01 Personnel Services5 01 01 Salaries and Wages5 01 01 010 Salaries and Wages - Regular5 01 01 020 Salaries and Wages - Casual/Contractual5 01 02 Other Compensation5 01 02 010 Personal Economic Relief Allowance (PERA)5 01 02 020 Representation Allowance5 01 02 030 Transportation Allowance5 01 02 040 Clothing/Uniform Allowance5 01 02 050 Subsistence Allowance5 01 02 060 Laundry Allowance5 01 02 070 Quarters Allowance5 01 02 080 Productivity Incentive Allowance5 01 02 090 Overseas Allowance5 01 02 100 Honoraria5 01 02 110 Hazard Pay5 01 02 120 Longevity Pay5 01 02 130 Overtime and Night Pay5 01 02 140 Year End Bonus5 01 02 150 Cash Gift5 01 02 990 Other Bonuses and Allowances

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Sub-Object Codes

EXPENSES 50000000 00

PERSONNEL SERVICES 50100000 00

Salaries and Wages 50101000 00

Salaries and Wages – Regular 50101010 00

Basic Salary – Civilian 50101010 01

Base Pay - Military/Uniformed Personnel 50101010 02

Salaries and Wages - Casual/Contractual 50101020 00

Other Personnel Benefits 50104990 00

Pension Benefits 50104010 00

Pension Benefits - Civilian 50104010 01

Pension Benefits – Military/Uniformed Personnel 50104010 02

Other Personnel Benefits 50104990 00

Lump-sum for Creation of New Positions - Civilian 50104990 01 Lump-sum for Creation of New Positions - Military/Uniformed Personnel 50104990 02

Lump-sum for Reclassification of Positions 50104990 03

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New Codes for Capital Outlays

CAPITAL OUTLAYS 50600000 00

Investment Outlay 50601000 00

Investment in Corporations and Subsidiaries Outlay 50601010 00

Investment in Government - Owned/Controlled Corporations 50601010 01

Investment in Subsidiaries Outlay 50601010 02

Loans Outlay 50601020 00

Loans Outlay – GOCCs 50601020 01

Loans Outlay – Others 50601020 02

Investment Property Outlay 50601030 00

Investment Property – Land 50601030 01

Investment Property - Buildings 50601030 02

Property, Plant and Equipment Outlay 50602000 00

Land Outlay 50602010 00

Land Improvements Outlay 50602020 00

Land Improvements - Aquaculture Structures 50602020 01

Reforestation Projects Outlay 50602020 02

Other Land Improvements 50602020 03

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Thank you!

www.pfm.gov.ph

GIFMIS Development Project

Objective

• Facilitate the physical development of a GIFMIS solution that can collect and organize financial information in a central database

• GIFMIS is an integrated web-based application to enable agencies to generate real-time, reliable and accurate financial reports

Key Activities

• Development of the National Payroll System (NPS) and payroll-related Government Human Resource Information System (GHRIS)

• Conceptual Design of GIFMIS

• Development of the Online Submission of Budget Proposal

• Enhancement of the eBudget Preparation Management System

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