CHAPTER 3 – THE GOVERNMENT ACCOUNTING PROCESS 3.

Registries of Allotments, Obligations and Disbursements (RAOD) – used to monitor

the allotments received, obligations incurred against the corresponding allotment,
Introduction and the actual disbursements made. This is to ensure that obligations incurred will
The government accounting process comprises the activities of analyzing, recording, not exceed allotments while actual disbursements will not exceed the obligations
classifying, summarizing and communicating transactions involving the receipt and disposition incurred.
of government funds and property, and interpreting the results thereof. This process is similar
to that of a business entity, except that it incorporates budgetary controls, such as recording in Separate RAOD shall be maintained or each object of expenditure.
the budget registries and preparing periodic budget accountability reports.
Object of Expenditures
Books Accounts and Registries
The books of accounts and registries of government entities consist of: The classifications of expenditures by object are as follows:
1. Journals a. Personnel Services (PS) – pertain to all types of employee benefits,
a. General Journal e.g., salaries, bonuses, allowances, cash gifts, etc.
b. Cash Receipts Journal
c. Cash Disbursements Journal b. Maintenance and Other Operating Expenses (MOOE) – pertain to
d. Check Disbursements Journal various operating expenses other than employee benefits and
financial expenses, e.g., travel, utilities, supplies, etc.
2. Legers
a. General Ledgers c. Financial Expenses (FE) – pertain to finance costs, e.g., interest
b. Subsidiary Ledgers expense, bank charges, etc. Financial expenses also include losses
on foreign exchange transactions.
3. Registries
a. Registries of Revenue and Other Receipts (RROR)
d. Capital Outlays (CO) – pertain to capitalize expenditures e.g.,
b. Registry of Appropriations and Allotments (RAPAL)
expenditures on the construction of public infrastructures, acquisition
c. Registries of Allotments, Obligations and Disbursements (RAOD)
costs of equipment, etc.
d. Registries of Budget, Utilization and Disbursements (RBUD)

Technically, only the Journals and Ledgers are considered accounting records. Accordingly, the following separate RAODs shall be maintained: (a) RAOD-PS; (B)
These are similar to the accounting records of a business entity. The Registries are budget RAOD-MOOE; (c) RAOD-FE; and (d) RAOD-CO.
records. These are used to monitor the budget. You may think of the registries like “logbooks”
or something, rather than accounting books with debit and credit columns. The accounting 4. Registries of Budget, Utilization and Disbursements (RBUD) – used to record the
unit of the agency maintains the Journals and Ledgers while the budget division of the agency approved special budget and the corresponding utilizations and disbursements
maintains the Registries. charged to retained income. Separate RBUDs are also maintained for each object of
Recall that separate accounting records and budget registries are maintained for expenditure, i.e., (a) RBUD-PS; (b) RBUD-MOOE; (c) RBUD-FE; and (d) RBUD-
each fund cluster (i.e., Regular Agency Fund, Foreign Assisted Projects Fund, etc.) CO.

Keeping of the General Accounts

Budget Registries The COA shall keep the general accounts of the Government and preserve the vouchers and
1. Registries of Revenue and Other Receipts (RROR) – used to monitor the budgeted other supporting documents.
amounts, actual collections and remittances of revenue and other receipts.
Basic Recordings
2. Registry of Appropriations and Allotments (RAPAL) – used to monitor appropriations
and allotments. This is to ensure that allotments will not exceed appropriations.  Appropriation – the receipt of the appropriation is posted (recorded) in the Registry
of Appropriations and Allotments (RAPAL).
 Allotment – the receipt of allotment is posted (recorded) in the RAPAL and RAOD.
  Obligation – is an act of a duly  Obligation is another term for
authorized official which binds the liability.
government to the immediate or
eventual payment of a sum of
money. Obligation maybe referred
Incurrence of Obligation to as a commitment that
encompasses possible future
Obligation Request and Status (ORS) liabilities based on current
Obligations shall be incurred through the issuance of Obligation Request and Status contractual agreement.
(ORS). The Requesting Office shall prepare this document, supported by valid claim
documents like disbursement vouchers, payrolls, purchase/job orders, itinerary of travel,
etc.
The Head of the requesting Office shall certify the necessity and legality of the
obligation and the validity of the supporting documents. The Head of the Budget Division Disbursement Authority – Notice of cash Allocation (NCA)
shall certify the availability of the allotment. This time a journal entry shall be made in the accounting books because the
financial statement elements of the entity are now affected, i.e., increase in cash and increase
The “obligations” are recorded in the RAOD. in revenue. The entry is as follows:

Notice of Obligation Request and status Adjustment (NORSA) Dat Cash Modified Disbursement System (MDS), xx
If the obligations recorded in the RAOD and ORS above need to be adjusted, the subsequent e Regular
adjustment shall be made through the use of the Notice of Obligation Request and Status Subsidy from National Government xx
Adjustment (NORSA). The adjustment shall be effected through a positive entry (addition) or a To recognize receipt of NCA from DBM
negative entry (reduction), as appropriate.
The registries used to monitor the NCA are the following:
Up to this point, nothing is recorded yet in the accounting books. The recordings above are a. Registry of Allotment and Notice of Cash Allocation (RANCA) – used to determine
made on the budget registries. Journal entries shall be made only after: amount of allotments not covered by NCA and to monitor the available balance of
a. The employees have rendered services; NCA.
b. The office supplies are delivered and received; and b. Registry of Allotment and Notice of Transfer of Allocation (RANTA) – used to
c. The office equipment is delivered and received. determine the amount of allotments not covered by Notice of Transfer of Allocation
(NTA) and to monitor the available balance of NTA.
Only after these events occur that the entity’s financial statement elements are affected, The NCA is posted (recorded in the RANCA.
and thus, an accountable event has occurred that needs to be recognized.
In the meantime, the “obligations” recorded in the registries (but not yet in the accounting I. JOURNALS
books) are referred to as “Not Yet Due and Demandable.”
Notice that government entities and business entities used the term “obligation” or the a. General Journal – used to record transactions not recorded in the Special
phrase “incurrence of obligation” differently. Journal.

Government entity Business entity Special Journals:

b. Cash Receipts Journal -