Msi Accounting Manual PDF
Msi Accounting Manual PDF
Msi Accounting Manual PDF
A Landbank Subsidiary
B. Description of Accounts 11 – 30
IV. DETAILED POLICIES, SYSTEMS & PROCEDURES
Cash Receipt System 30 - 32
Cash Disbursement System 31
A. Preparation of Voucher & Recording of
Obligation 32 - 34
B. Preparation of Check and Recording of
Payment
Accounting System for Sales 35
Recording of Non-Cash Transactions
- Journal Voucher Preparation 36
General Ledger 1
General Journal 2
Cash Receipts and Deposits Book 3
Voucher Register Book 4
Check Register Book 5
Sales Book 6
Report of Collections and Deposits 7
Petty Cash Advance 8
Reimbursement/Liquidation Form 9
Temporary Cash Advance 10
Subsidiary Ledger 11
Travel Itinerary 12
Travel Order 13
Purchase Order 14
Purchase Requisition 15
Materials Received Report 16
Requisition and Issue Slip 17
Memorandum Receipt 18
Check Voucher 19
Disbursement Voucher 20
Collection Receipt/ Official Receipt 21
The detailed procedures show the route the forms follow and indicate how these
forms are entered in the Books of Accounts; likewise indicating the level of
responsibilities involved in each transaction, the number of required copies as
well as the proper distribution of copies for various forms.
The underlying general principles comprising the basic features contained in the
accounting system are follows:
3. Test of accuracy; i.e. all proofs of accuracy to the extent practicable should be
employed to ensure the correctness of the accounting data compiled;
CHART OF ACCOUNTS
ASSETS
CURRENT ASSETS
Cash
Cash In Bank
Marketable Securities
Accounts Receivables
Receivables - Trade/Business
Receivables - Miscellaneous
Receivables - Others
Receivables - Notes
Inventories
Inventories - Rice
Inventories - Palay
Inventories - Brokens
Inventories - By-Products
Inventories - Binlid
Prepaid Expenses
Contingent Assets
Transportation Equipment
Office Equipment
Machineries
Investment Property
Investments
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CURRENT LIABILITIES
Payables
Payables – Vouchers
Payables - Trade/Business
Payables – Miscellaneous
Trust Liabilities
Other Liabilities
Surplus Reserves
Capital
CASH
CASH IN BANK
This account is used to record deposits in a current account with authorized domestic
depository banks.
This account is used to record the amount of cash advances in the custody of officers of the
agency/corporation granting the cash advance who are duly designated regular and special
disbursing officers and whose duties are to disburse funds in payment of authorized official
expenditures.
This account is used to record cash advances granted to officers and employees of the
corporation for specific authorized official expenditures.
RECEIVABLES
RECEIVABLES – TRADE/BUSINESS
This account is used to record the amount due from customers resulting from
trading/business transactions, other than those supported by some form of commercial papers,
which are expected to be collected in the regular course of business.
RECEIVABLES – MISCELLANEOUS
This account is used to record the amount due from all parties which do not fall under any of
the other classes of receivables. Included in this account are lease/rental and commission
receivables.
INVENTORIES
INVENTORIES – RICE
INVENTORIES – PALAY
INVENTORIES – BROKENS
INVENTORIES – BY PRODUCTS
This account is used to record the cost or other appropriate value of merchandise in stock
which have been purchased/ produced/ milled and intended for sale.
This account is used to record the cost or other appropriate value of supplies and materials
acquired for immediate use in the course of operations.
PREPAID EXPENSE
This account is used to record expenses paid in advance but not yet incurred
This account is used to record the cost or other appropriate value of authorized marketable
securities acquired as a means of temporarily investing excess/idle funds.
- Government bonds
- Treasury bonds
- Other authorized marketable securities
This account is used to record the amount of deposits, charges and other assets which do
not fall under any of the miscellaneous assets and deferred charges.
CONTINGENT ASSETS
This account is used to record the amount of cash shortages in the accountability of
collecting/disbursing officers pending final settlement or disposition.
This account is used to record the amount due from third parties whose checks, previously
issued were dishonored by their banks.
- Dishonored checks
INVESTMENTS
- Subscriptions to capital stocks of government and private corporations other than public
enterprises.
- Subscriptions to bond issues of government and private corporations.
This account is used to record the cost or appraised value or other appropriate value of
buildings and structures which are more or less permanent and capital in nature.
a. Sale
b. Transfers to other government agencies
c. Transfers to other funds
d. Losses or other involuntary disposition
e. Donation given
f. Depreciation/Destruction
g. Adjustment (reduction)
TRANSPORTATION EQUIPMENT
OFFICE EQUIPMENT
Purchase or construction
Transfers from other government agencies
Transfers from other funds
Free acquisition
Donations received
Appreciation
Adjustment (additions)
Sale
Transfers to other government agencies
Transfers to other funds
Losses or other involuntary disposition
Donation given
Destruction
Adjustments (reduction)
This account is used to record reduction in the value of receivable accounts which are
considered uncollectible.
This account is used to record the estimate of the cumulative amount of capital (originally
invested in buildings and structures) used up because of fixed assets services consumed in operation
or in production of income. A separate allowance for depreciation account should be maintained for
each group of depreciable fixed assets.
- Value of the building or structure to which the allowance relates upon its retirement or
sale or demolition.
TRANSPORTATION EQUIPMENT
FURNITURE AND FIXTURES
OFFICE EQUIPMENT
OTHER PROPERTY PLANT AND EQUIPMENT
MACHINERIES
This account is used to record the estimate of the cumulative amount of capital (originally
invested) used up because of fixed assets services consumed in operation or in the production of
income. A separate allowance for depreciation account should be maintained for each group of
depreciable fixed assets.
- Value of the pertinent property to which the allowance relates upon its retirement or
sale.
- Amount of the periodic charges to depreciation expenses for the pertinent property
PAYABLES – VOUCHERS
This account is used to record the amount of goods and services purchased on account.
PAYABLES – TRADE/BUSINESS
This account is used to record liabilities for purchases of goods for resale and raw materials
for manufacture or production and other obligations in connection with the agency’s trade/business.
PAYABLES – MISCELLANEOUS
This account is used to record all other liabilities not falling under any of the above types or
classes of accounts payable. Included in this account is interest payable on loans.
TRUST LIABILITIES
This account is used to record the liability for collections received or amounts withheld in
trust for the account of national government agencies and advances made by national agencies for
specific purposes or expenditures.
TRUST LIABILITIES –
This account is used to record the liability for collections received or amounts withheld in
trust to government-owned or controlled corporations.
Remittance of collections received or amounts withheld for the account of the government-owned
and/or controlled corporations concerned.
This account is used to record the amount of funds collected or amount withheld in trust not
falling under any of the other types or classes of trust liability accounts.
This account is used to record all other miscellaneous liabilities and deferred credits which
cannot be classified under any of the miscellaneous liabilities and deferred credits account.
INCOME/ESTIMATED REVENUE
This shall be used as a summary account for income only at year-end. Correction of prior
year’s profit is included in this account.
- Income realized
- Adjustment (correction of prior year’s adjustment)
This account reflects profits and losses of a corporation. Its balance indicates the cumulative
amount earned over the corporate life of a business which has not been capitalized, consumed by
losses, or distributed as dividends to stockholders.
SURPLUS RESERVES
This account is used to record retained earnings earmarked for the expansion of plant.
This account is used to record the accumulated amount of retained earnings earmarked
each year for the payment of retirement gratuities of corporate personnel.
This account is used to record retained earnings earmarked for replacement of fixed assets.
This account is used to record the amount of retained earnings earmarked for reserves other
those specified above.
CAPITAL
This is account is used to record capitalization given to the corporation or the capital stock
which it is legally authorized to issue as stated in its charter.
- Write-off upon liquidation or dissolution of the corporation after all its liabilities has
been paid.
PERSONAL SERVICES
PERSONAL SERVICES
This account includes the pay proper, accrued terminal leave pay, salary adjustments and
standardization; allowances for subsistence, quarters, laundry, cost of living, per diem compensation
and longevity pay; premiums for social security insurance; overtime pay; commutable allowances for
transportation and representation expenses for training and improvement of personnel by agencies
with schooling activities; fees, allowances and other emoluments given to consultants and
specialists; bonuses and incentives; and hospitalization, medical, dental, optical, hazard pay, and
other benefits given to officials and employees.
SSS PREMIUM
PHILHEALTH PREMIUM
PAG-IBIG PREMIUM
OVERTIME PAY
COMMUTABLE ALLOWANCES
OTHER BENEFIT
PENSIONS
This account includes expenses incurred in the movement of persons, whether employed in
the government or not, such as transportation, subsistence, lodging and travel per diem, hire of
guides or patrol, transportation of personnel baggage or household effects; railroads, airline, and
steamship fares, tips transfers, etc. of persons while travelling abroad; charter of boats, launches,
automobiles, etc., non-commutable transportation allowances, road tolls, parking fees and all other
similar expenses.
This account includes expenses for the communication of messages such as telephone,
wireless and cable charges and tolls, postage charges; rent of post office boxes; and messengerial
services.
This account includes the cost of repairing and maintaining government facilities such as
public buildings, roads, bridges, irrigation systems, river control and sea protection works, artesian
wells, water supply systems, telegraph lines, radio stations, wharves and other public structures.
TRANSPORTATION SERVICES
OTHER SERVICES
This account includes the cost of all other services which are not otherwise classified under
any other account. Examples are: expenses for training; seminars/workshops of personnel;
advertising and publication of notices in newspapers; repairs and maintenance of equipment (except
motor vehicle) when done by other government agencies or by others and the cost of their
alterations and improvements. Examples are: office and grounds, quarters of personnel, arsenal,
barracks, warehouses, school houses, office machines, and road and other maintenance equipment.
INTERESTS
This account includes charges for the use of funds belonging to others such as interest on
bonds, loans, overdrafts, treasury notes, certificates of indebtedness, and other interest-bearing
obligations.
This account includes payments made either directly or into a sinking fund established for
the retirement of public debt and other long term obligations.
LOSSES/DEPRECIATION/DEPLETION
This account includes losses of current assets due to deterioration of supplies and sales
stock, uncollectible debts and losses of government funds or property.
This account includes the cost of all expendable commodities acquired or ordered for
immediate use in connection with company’s operation. It also includes, but is not restricted to
RENTS
This account includes the fees for the use of facilities or equipment.
This account includes the cost of water and electricity or gas for illumination, consumed in
facilities such as office buildings, shops and grounds; streets, plazas, parks and monuments; etc. in
connection with the company’s operations and projects.
MAINTENANCE OF MOTOR VEHICLES USED FOR OFFICIAL TRAVELS OF OFFICIALS AND EMPLOYEES
This account includes the cost of maintaining automobiles and other vehicles for official
travels of officials and employees. The following sub-accounts shall be used to identify the purpose
of expenditures:
DISCRETIONARY EXPENSES
This account includes the cost of services, which are confidential in nature, rendered by
persons who are temporarily employed by authorized administrative or executive officers to carry
on successfully administrative activities; and expressly authorized confidential expenses for which
appropriations have been approved specifically for the purpose.
REPRESENTATION EXPENSE
This account includes the expenses for entertainments, memorials, flowers and the like. The
purpose of the expenses should be of public character, beneficial to the interest of the public
service, and connected with the exercise of the powers and functions of the agency concerned.
This account includes payments and provisions for all taxes and licenses except income tax.
TRADING/PRODUCTION
This account is for the exclusive use of agencies engaged in trading/production. Each agency
shall supply the sub-accounts of expenditures peculiar to its business such as cost of sales, cost of
production/manufacturing, direct cost, indirect cost, etc.
*LOSS ON SHRINKAGE
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This account includes all interest earned on account of the agency’s business operation and
rendition of government service and deposits with banks.
COMMISSION
This account includes all commissions earned on account of the agency’s operations.
RENT
This account includes rents earned for lease of property such as land, buildings, machinery
and equipment to the private sector.
SALES
SALES RETURNS
This account includes all income derived from business trading operation.
MISCELLANEOUS INCOME
This account includes all other income derived on account of corporate service and business
operations not falling under any of the above-mentioned incomes.
This refers to interest income and dividends, in respect of financial assets, rent and royalties,
in respect of the use of land.
This account includes dividends in any form derived from investments on stocks of
corporations including public enterprises.
This account includes the value of articles found as overages in any of the items falling under
asset account “Inventories”.
This account includes all other income not included in the income accounts previously
enumerated.
This includes all non-repayable unrequited transfers received from other levels of
government, private sector or international institutions. Grants encompass reparations and gifts for
particular projects or programs, general budget support or of any other purposes.
This account includes grants and aids consisting of money and/or materials coming from
another level of government within the country such as from national to local government and vice-
versa; and from national or local government to government-owned or controlled corporations and
vice-versa.
This account is used to record the amount due from/to the field office/unit of government
and/or controlled corporations.
CASH RECEIPTS
1. The responsibility for the receipts, custody and subsequent deposit of all collections
is vested in the Cashier.
2. All cash receipts are deposited intact the following banking day. While on hand,
these collections are segregated from other funds.
5. Cash receipt is reported in the daily Report of Collections and Deposits and must
equal the total of Official Receipts issued during the day.
8. The Corporations Provisional Receipt and Official Receipt are in booklet form, pre-
numbered and in three copies each.
9. Proper accounting and filing of said forms must be properly arranged according to its
numerical sequence.
10. Cancelled Provisional Receipt and Official Receipt must be voided properly and must
not be detached from the booklets.
CASH DISBURSEMENT
1. All classes of disbursement shall meet the following basic requirements:
4. Check voucher shall be prepared for every disbursement voucher. The check
voucher shall serve as the duplicate copy of the check and must be
attached to the DV.
9. Release of checks shall be effected only after it has been signed by at least
two authorized/designated signatories.
10. All checks issued shall be recorded in a Check Register. After payment, the
disbursement voucher and supporting documents shall be stamped “PAID” so
that these may not be presented for second payment.
11. Official Receipt will be required from authorized collectors upon release of
their checks.
12. Blank checks shall be kept in the proper custody of the Cashier as
accountable Forms.
13. The Cashier and other fund custodian shall properly bonded.
14. Assuming all papers are complete, the normal processing period for the
voucher and check is three (3) working days.
2. A Journal Voucher is prepared, filed and safe kept in a labeled folder with
attachments.
3. When the transactions to be recorded entails a series of computations that
correspond to different items, a schedule must be prepared.
2. Signs JV.
1. Bank deposit and withdrawal transactions must be reconciled monthly with the
bank by the Bookkeeper or the duly authorized personnel.
3. Bank Reconciliation Statement must be prepared and presented using the adjusted
balance concept.
POLICY GUIDELINES:
NOTE:
Before MRPCA is presented to the Cashier, it
should be duly signed by the Department Head.
Upon Liquidation:
Internal Auditor 14. Audit, checks and signs PCRV, then forwards
documents to the President and CEO.
President and CEO 15. Receives copy of 1-2 of PCRV, copy of PCV,
MRPCA, OR and OSDs. Approves and signs PCRV.
Forwards documents to the Accounting Assistant
for Disbursement Voucher preparation. (Please
refer to Disbursement Voucher Narrative
Procedure.)
1. Temporary cash shall be given only for emergency purposes and should be official in
nature.
3. Temporary cash advance shall not be allowed unless a previous one has been
settled/liquidated and properly accounted for.
4. Temporary cash advance shall be liquidated within forty eight (48) hours after the
purpose for which it has been granted has been accomplished. Any unused portion
should be refunded to the Cashier.
5. Temporary cash advance shall be granted only if the amount involved is not less than
P3,000.00
GRANTING
LIQUIDATION
President and CEO 5. Receives LDs from the Internal Auditor. Approves
and signs the LDs.
2. The price being claimed is the lowest price obtainable at the time of purchase.
3. In addition to all the needed supporting documents on purchases of all types must
include a Certification of Emergency Purchase which states :
“This is to certify that the purchase made was necessary and absolutely
indispensable to prevent immediate danger to property and avoid
detriment to public service and that the prices being claimed are the lowest
price obtainable at the time of purchase”.
POLICY GUIDELINES:
2. When purchases are made from an exclusive distributor the supporting papers
needed are certificate of sole distributorship and an official price list.
POLICY GUIDELINES:
3. The property officer shall be responsible for ensuring that the items to be received
from the suppliers are according to specifications as indicated in the Purchase
Order/Contract. For this purpose, a copy of the Purchase Order duly approved by
designated officers shall be furnished by the Property Officer.
4. Delivered items which do not meet the specifications shall be rejected and returned
to the supplier for appropriate action.
POLICY GUIDELINES:
2. All issuances of materials and supplies must be properly recorded in the stock card.
POLICY GUIDELINES:
1. All properties of the corporation which are classified as Property, Plant and
Equipment shall be insured.
3. All original insurance record shall be in the custody of the General Services Assistant.
POLICY GUIDELINES:
1. Depreciation is the allocation of cost or value of the Property, plant and equipment
over fixed asset cost to operating periods which benefits from its use in a reasonable
4. For expediency, depreciation begins on the month following the date in which the
asset is acquired or put into use or operation.
Depreciation on the addition to an existing asset is computed over the remaining life
of the main existing asset.
POLICY GUIDELINES:
1. Repairs and maintenance work either for outside services or for in-house services by
the General Services.
2. The procedures for in-house repairs and maintenance cover only those repair
services requiring the use or purchase of necessary materials and supplies which are
not normally carried as stock items.
b) Minor Repairs
This involves relatively small expenditures which does not prolong the life nor
enhance the value of the asset. Since it does not benefit future accounting
periods, it should be charged directly against current operations.
4. Major repairs require prior written approval by the Department Head with the
concurrence of the President and CEO.
POLICY GUIDELINES:
1. Physical inventory of all fixed assets and supplies and materials shall be conducted
at least once a year, as of December 31 and whenever there is a change of property
officer. The Inventory Report shall be compared with the quantity reflected in the
Fixed Asset Ledger card and eventually with the General Ledger balance.
2. Discrepancies between the actual count and the recorded figure should be properly
investigated, reported and adjusted, if necessary.
POLICY GUIDELINES:
1. Accountability for fixed asset should be transferred from the original user staff to the new
accountable employee in case the property is transferred from one employee to another.
2. Transfer of accountability should be done by cancelling the old MR and issuing a new MR in
the name of the transferee.
3. The transferor shall notify the General Services Assistant and surrender the copy of covering
MR in case of resignation or transfer from one unit to another.
4. The General Services Assistant shall ensure that accountability is transferred promptly and
properly to the new accountable employee.
POLICY GUIDELINES:
1. Retirement, disposal or sale of fixed asset should be made only upon prior approval by the
Board of Directors and is promptly communicated to the accountant for appropriate
recognition thereof in the accounting records.
2. Retirable and obsolete properties are disposed of in the presence of authorized official and
in conformity with existing applicable government rules and regulation.
I acknowledged to have received from _____________________, property Custodian, the following property
for which I am Responsible, Subject to the provisions of the Accounting Law, and which will be used
in Finance/Admin. Unit.
DATE
QTY UNIT NAME AND DESCRIPTION ACCOUNTED PROP. NO. AMOUNT
Approved
Prepared by: by:
Corporate Services
Admin. Asst. I Manager
Received by: