1. Discuss the purpose of having a unified accounts code structure (UACS)?

The Unified Accounts Code Structure or UACS is a government-wide harmonized budgetary, treasury
and accounting code classification framework jointly developed by the Department of Budget and
Management (DBM), the Commission on Audit (COA), the Department of Finance (DOF) and the Bureau
of the Treasury (BTr) to facilitate reporting of all financial transactions of agencies including those for
revenue generation.

As a coding framework for financial transactions, the UACS ensures that all processes, from budgeting
and cash management to accounting and audit will follow a single classification system or common
language. The new codes will make it easier to collect, aggregate, consolidate and report financial
transactions across government.

The objective of the government-wide Unified Accounts Code Structure (UACS) is to establish the
accounts and codes needed in reporting the financial transactions of the National Government of the
Republic of the Philippines. The UACS provides a framework for identifying, aggregating and reporting
financial transactions in budget preparation, execution, accounting and auditing.

The key purpose of the UACS is to enable the timely and accurate reporting of actual revenue collections
and expenditures against budgeted programmed revenues and expenditures.

[Link] are the key elements of the Unified Accounts Code Structure? Explain each element briefly

1. Funding Source codes. Six digits are available for the Funding Source code. The Funding Source code is
composed of the Financing Source, Authorization and Fund Category codes. The first digit of the Funding
Source indicates whether the expenditure is sourced inside or outside the general fund, which is the
case for all budgeted spending and continuing or automatic appropriations. The next two digits are for
the Authorization code, while the last three digits are for the Fund Category code.

2. Organization codes. The Organization Code is structured into three segments: 1.) Department:
primary subdivision of the Executive Branch responsible for the overall management of a sector or a
permanent national concern 2.) Agency: o any of the various units of the government, including an
office, instrumentality or Government-Owned and/or Controlled Corporation (GOCC) and 3.) Lower
Level Operating Unit/Revenue Collecting 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 and field units.

3. Location codes. To facilitate central agency analysis across the National Government, location coding
should first enable the analysis of data by region, and then by province, municipality/city and barangay.
The coding structure here relies upon the codes used by the National Statistical Coordination Board
(NSCB) only.

4. MFO/Program, Activity and Project (PAP) codes. An MFO is defined as a good or service that a
department or agency is mandated to deliver to external clients through the implementation of
programs, activities and projects. MFOs should be within the department or agency’s control and be
measurable, manageable and auditable. A program is an integrated group of activities that contributes
to an agency or department’s continuing objective. An activity is defined as a work process that
contributes to the fulfillment of a program or project. Each activity shall be attributed to only one MFO.
Projects are special department/agency undertakings carried out within a definite timeframe, and which
are designed to produce a pre-determined measure of goods or services (MFOs). A project is considered
an investment toward expanding the capacity of a department/agency to deliver MFOs.

5. Object Codes for Assets, Liabilities, Equity, Income and Expenses. The object classification covers all
financial transactions of the government such as, but not limited to, goods or services acquired, transfer
payments made, the source of revenue or the cause of increases or decreases in assets and liabilities

3. Enumerate the reporting requirements that will be best served by UACS.

1. Financial reports as required by the Department of Budget and Management (DBM) and the
Commission on Audit (COA),

2. Financial Statements as required by the Public Sector Accounting Standards Board of the Philippines,

3. Management reports as required by the executive officials/heads of departments and agencies, and

4. Economic statistics consistent with the Government Finance Statistics (GFS) Manual 2001.

4. What is the municipality identifier?

The Municipality Identifier is the core of the national standard geographic classification system. This is
composed of the Province Code, followed by the Municipality Code. The Municipality Identifier is a four-
digit number that defines the identity of the municipality.

5. Explain the transitory measure to allow government agencies/operating units sufficient time in
the familiarization of the UACS Code.

According to National Budget Circular No. 554 dated March 14, 2014, "Conversion of Codes
to Conform to the UACS,", it allows Government Agencies/Operating Units to have sufficient
time in the familiarization of the UACS codes.

The DBM shall still reflect the previous codes along the UACS codes in the release documents. However,
all NGAs and operating units are authorized to make necessary conversion of the appropriate codes to
conform to the UACS code.

6. What are the sources of account description and codes in the UACS Object coding elements?

The Object Codes in UACS is based on the Revised Chart of Accounts for National Government Agencies,
of the Commission on Audit as adopted under COA Circular No. 2013-002 dated January 30, 2013, and
COA Circular No. 2014-003 dated April 15, 2014.

7. Discuss why the Revised Chart of Accounts in COA Circular No. 2013-002 dated January 30, 2013 was
created.
The Commission recognizes the need to revise the existing New Government Accounting System (NGAS)
Chart of Accounts prescribed in COA Circular No. 2004-008 dated September 20, 2004, as amended, to
provide new accounts for the adoption of the Philippine Public Sector Accounting Standards which were
harmonized with the IPSAS to enhance the accountability and transparency of the financial reports, and
ensure comparability of financial information.

The Commission also recognizes the need for uniform accounts to be used in the national government
accounting and budget systems to facilitate the preparation of harmonized financial and budget
accountability reports.

8. What are the five (5) of expenses in the Revised Chart of Accounts in COA CIrcular No. 2013? Give the
sub-major account group classifications.

1. Personnel services

i. Salaries and wages

ii. Other compensation

iii. Personnel benefit contributions

iv. Other personal benefits

2. Maintenance and other expenses

i. Traveling expenses

ii. Training and scholarship expenses

iii. Supplies and material expenses

iv. Utility expenses

v. Communication expenses

vi. Awards/rewards, prizes and indemnities

vii. Survey, research, exploration, and development expenses

viii. Generation, transmission, and distribution expenses

ix. Confidential, intelligence, and extraordinary expenses

x. Professional services

xi. General services

xii. Repairs and maintenance

xiii. Financial assistance/subsidy

xiv. Taxes, insurance premiums, and other fees

xvi. Other maintenance and operating expenses

3. Financial expenses

i. Financial expenses

4. Direct costs

i. COGM

ii. Cost of sales

5. Non-cash expenses

i. Depreciation

ii. Amortization

iii. Impairment loss

iv. Losses

9. Enumerate the five (5) account code structure fo the Revised Chart of Accounts consisting of eight (8)
mandatory digits. Explain Briefly.

The Account Group represents the accounts classification as to Assets, Liabilities Equity Income and
Expenses.

The Major Account group represents classification within the account group; example: for Asset
major accounts- Cash and Cash Equivalents, Investments, Receivables, etc.

Sub-Major Account group represents classification within the major e.g. for Cash and Cash Equivalent:
Cash on Hand, Cash in Bank-Local Currency, Cash in Bank-Foreign Currency, etc.

The General Ledger accounts represent the accounts to be presented in the detailed
financial statements, e.g. Cash-Collecting Officer, Petty Cash, etc. This is Composed of segments. The
first two digits from the left is the general ledger code, and the last digit is reserved for contra
accounts like, Allowance for Impairment, Accumulated Depreciation, etc.

10. Enumerate and explain briefly the elements of financial statements per COA Circular No. 2013 -002

Assets — economic resources of an agency that are recognized and measured inconformity with
generally accepted accounting principles. Any owned physical object (tangible) or right (intangible) with
economic value that is expressed, for accounting purposes, in terms of its cost or some other value.
These other values include revalued amounts, current cost, net realizable value, fair value
and recoverable amounts.

Liabilities --- economic obligations of an agency that are recognized and

measured in conformity with accounting principles. Also include certain deferred

measured according to accounting principles as outlined in Philippine Public

Sector Accounting Standards.

Equity ---- residual interest of the government in an agency which is the excess of

the agency's assets over its liabilities.

Income---- the gross inflow of economic benefits or service potential during the

reporting period, when those inflows result in an increase in net assets/equity,

other than increases relating to contributions from owners. The term "income" is

broader that revenue and includes gains in addition to revenue.

Expenses —refer to decrease in economic benefits or service potential during the

reporting period in the form of outflows or consumption of assets or incurrence of

liabilities that result in decrease in net assets/equity, other than those relating to

distributions to owners.