1.2 General Accounting Policies

The following general policies shall be observed in accounting for barangay funds and property:

1.2.1. For accounting purposes, the fiscal year for the barangay shall start on January 1st and end on December 31st of each year.

1.2.2. Barangay accounts shall be kept under a double-entry bookkeeping system.

1.2.3. The barangay financial transactions shall be recorded using the Chart of Accounts prescribed by the Commission on Audit.

1.2.4. Barangay books of accounts shall consist of a Journal of Cash Transactions (JCT) - Annex 1, General Journal (GJ) - Annex 2, General Ledger (GL) - Annex 3 and Subsidiary Ledger (SL) -Annex 4 which shall be maintained by the barangay bookkeeper under the direct supervision of the City/Municipal (C/M) Accountant.

1.2.5. Cash transactions shall be recorded in the JCT and non-cash transactions shall be recorded in the GJ through a Journal Entry Voucher (JEV) - Annex 5.

1.2.6. Funds granted to barangays for specific purpose shall be recognized as Special Trust Fund (STF).

1.2.7. Subsidies and grants for specific purpose shall be accounted for as Trust Liability. Once conditions are met, the portion of the grant corresponding to the expenditure incurred shall be recognized as income, and the expenditure as expense or asset as the case may be.

1.2.8. Unspent Local Disaster Risk Reduction and Management Fund (LDRRMF) and the share of the Sangguniang Kabataan (SK) shall be recorded as STF.

1.2.9. Registry of Special Trust Fund (RSTF) as presented in Annex 33shall be maintained for each STF.

1.2.10. Appropriations and Obligations shall be recorded, monitored and controlled using the Record of Appropriations and Obligations(RAO) - Annex 6

1.2.11. A Cashbook (Annex 8) shall be maintained and updated daily.

1.2.12. Revenues shall be classified as exchange and non-exchange.

1.2.1. Revenue from non-exchange transactions:

a. Taxes -revenue shall be recognized when the taxable event occurs and the asset recognition criteria are met.

b. Transfers -
1. Transfers without conditions are recognized as revenue.

2. Transfers with conditions are recognized as liability and the corresponding liability is reduced when the conditions are satisfied.


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