GROUP 3_PPT.pdf. gddui gffxru ughhffdfhjk

this file is included in the category of education.

1. REVENUES AND
OTHER RECEIPTS

2. REVENUE
The gross inflow of economic
benefits or service potential
during the reporting period
when those result in an increase
in equity.
Includes only those that are
received or receivable by the
entity in its own account.
INTRODUCTION
RECEIPTS
Refer to actual cash collections
from all sources during a period.

3. FUNDAMENTAL PRINCIPLES FOR
REVENUE
a.All revenues should be admitted to the National Treasury and
included in the General Fund of the National Government.
b.All moneys and properties received by a public officer shall be
accounted for as government funds and property.
c.In accordance with relevant rules, amounts that are received in
trust and from business-type activities of the government may be
recorded and disbursed separately.
d.Receipts shall be recorded as revenue of Special, Fiduciary or
Trust Funds, or Funds other than the General Fund only when
authorized by law.
e.A collecting officer shall immediately issue an official receipt
upon collecting a payment of any nature.

4. FUNDAMENTAL PRINCIPLES FOR
REVENUE
f.Where mechanical devices are used to acknowledge cash
receipts, upon request, the COA may approve the exemption
from the use of accountable forms.
g.Temporary receipts shall never be used to acknowledge the
receipt of public funds.
h.Pre-numbered official receipts shall be issued in strict numerical
response.
i.A collecting officer shall accept payments to the government in
the form of checks but shall not use government funds to encash
private checks.
j.Receipts of government funds shall be acknowledge with the law

5. TYPES OF FUNDS
•GENERAL FUND
•SPECIAL FUND
•TRUST FUND (FIDUCIARY FUND)
•REVENUE FUND
•DEPOSITARY FUND
•SPECIAL ACCOUNT IN THE GENERAL FUND (SAGF)
•SPECIAL PURPOSE FUNDS (SPFs)

6. EXCHANGE TRANSACTIONS
(Reciprocal transfers)
- transactions in which an entity
receives assets or services or
extinguished liabilities and
sacrifices something with
approximate same value.
SOURCES OF REVENUE
NON-EXCHANGE TRANSACTIONS
(Non-reciprocal transfers)
- an entity gives (receives) value
without directly receiving (giving)
the same value in return.

7. EXCHANGE TRANSACTIONS
Revenues from exchange transactions arise from the following:
a.Sale of goods or provision of services to third parties or
other government entities.
Examples:
Service Income
Business Income
b.Used by other entity of assets yielding interest, royalties
and dividends
Examples:
Interest income
Royalties
Dividends

8. EXCHANGE TRANSACTIONS
Recognition of Revenues
SALES OF GOODS
Can be recognized as revenue if following conditions are
satisfied:
a.Significant risk and rewards of ownership of the goods are
transferred to the buyer;
b.Entity does not retain continuing managerial involvement or
effective control over the goods sold;
c.It is probable that economic benefits will flow to the entity;
d.revenue can be measured reliably; and
e.cost can be measured

9. EXCHANGE TRANSACTIONS
Recognition of Revenues
RENDERING SERVICES
Can be recognized as revenue in reference to the stage of
completion if following conditions are satisfied:
a.The stage of completion of the transaction can be measured
reliably at the reporting date;
b.It is probable that economic benefits will flow to the entity;
c.revenue can be measured reliably; and
d.cost can be measured

10. EXCHANGE TRANSACTIONS
Recognition of Revenues
INTEREST, ROYALTIES & DIVIDENDS
a.Interest Income – recognized on a time proportion basis that
takes into account the effective yield on the asset
b.Royalties – recognized as they are earned in accordance with
the substance of the relevant agreement
c.Dividends – recognized when the entity’s right to receive
payment is established
Measurement of Revenue
- measured at fair value of the consideration

11. Date Accounts Receivable
Sales Revenue (20,000 * 90% * 95*)
To record sales on account
17, 100
17, 100
EXCHANGE TRANSACTIONS
Example: Entity A sells goods with a list price of P20,000, with
the credit term of 10% and 5%. Revenue is recognized as follows:
•Cash flows are deferred
– fair value of the consideration < nominal amount
•When consideration received in advance, it’s initially recorded
as liability then recognized as revenue when criteria are met.

12. EXCHANGE TRANSACTIONS
Exchanges of Goods or Services
a.Similar nature and value do not give rise to revenue.
b.Dissimilar nature and value give rise to revenue measured using
the following order of priority:
i. Fair value of the goods or services received, adjusted by the
amount of any cash transferred.
ii. Fair value of the goods or services given up, adjusted by the
amount of any cash transferred.

13. NON-EXCHANGE TRANSACTIONS
Revenue for non-exchange transactions are derived from:
a.Taxes
b.Fines and penalties
c.Gifts, donations and goods/services in kind
Recognition of Revenue
– recognized on a cash basis

14. Type of tax Taxable event
Income tax Earning of taxable income
Value added tax Undertaking of a taxable activity
Customs duty Movement of dutiable goods or services across the
customs boundary
Death duty Death of the owner taxable property
NON-EXCHANGE TRANSACTIONS
Recognition of Revenue
a. TAX REVENUE
•Recognized at a gross amount and not reduced for expenses
paid through the tax system
•Shall not be grossed up for the amount of tax expenditures
Examples:

15. NON-EXCHANGE TRANSACTIONS
Recognition of Revenue
b. TRANSFERS
•Inflows of future economic benefits from non-exchange
transactions other than taxes
1.Fines and Penalties – recognized as income in the year they
are collected; fines are recognized as revenue when
receivable meets the recognition criteria for asset; an entity
collecting fines as an agent shall not recognized fines as
revenue.
2.Gifts, Donations and Goods In-kind – recognized as
revenue when it is probable that future economic benefits will
flow to the entity

16. NON-EXCHANGE TRANSACTIONS
Recognition of Revenue
3.Services In-kind – not recognized as revenue due to the
uncertainties; it may be disclosed in the notes Examples:
volunteer services, technical assistance from
foreign bodies
Measurement
a.Assets – at the acquisition-date fair value
b.Liabilities – at present value, when the effect of time value of
money is material
c.Revenue – at the amount of increase in net assets, if the
revenue is recognized as liability initially, the reduction in the
liability is recognized as revenue

17. NON-EXCHANGE TRANSACTIONS
DEBT FORGIVENESS
•Lender – recognizes revenue equal to the carrying amount of the
debt forgiven
•Controlling entity – the cancelled debt is treated as contribution
from owners
BEQUESTS
•Made according to the request of a deceased person’s will,
recognized revenue when the recognition criteria for asset is
satisfied and measured at the fair value of the resources
received or receivable.

18. NON-EXCHANGE TRANSACTIONS
GRANT WITH CONDITION
•Initially recognized as liability and recognized as revenue when
the condition is satisfied.
Example:
Foreign grant of is received P10M is received by the national
government (NG) conditioned on the construction of a flood
control system which must be completed within the next 2 years,
otherwise the grant must be returned to the grantor. The
implementing entity is the DPWH.

19. NON-EXCHANGE TRANSACTIONS
The journal entries are as follows:
a. Receipt of grant
Books of the NG - BTr Debit Credit
Cash in bank – local currency,Bangko
Sentral ng Pilipinas
Other Deferred Credits
P 10M
P 10M
Books of DPWH
Cash – Modified Disbursement
System (MDs), Regular
Subsidy from NG
P 10M
P 10M

20. NON-EXCHANGE TRANSACTIONS
The journal entries are as follows:
b. Disbursement for materials and labor amounting to P 10M
Books of the NG - BTr Debit Credit
Subsidy from NG
Cash in bank – local currency, Bangko
Sentral ng Pilipinas
P 10M
P 10M
Books of DPWH
Construction in Progress –
Infrastructure Assets
Cash – Modified Disbursement
System (MDs), Regular
P 10M
P 10M

21. NON-EXCHANGE TRANSACTIONS
The journal entries are as follows:
c. Completion of the project
Books of the NG - BTr Debit Credit
Other Deferred Credits
Income from grants and donations in
cash
P 10M
P 10M
Books of DPWH
Flood Control System
Construction in progress -
Infrastructure Assets
P 10M
P 10M

22. NON-EXCHANGE TRANSACTIONS
PLEDGES
•an unenforceable undertakings to transfer assets to the recipient
entity
•Not recognized as revenue
CONCESSIONARY LOANS
•Loans received by an entity at below market terms
•Recognized as revenue (difference between fair value and the
transaction price
•If present obligation exists, the difference is recognized as liability
and if the obligation is satisfied, it will be recognized as revenue.
IMPAIRMENT LOSSES AND ALLOWANCE FOR IMPAIRMENT LOSSES
•Revenue recognized becomes uncollectible – it is recognized as
expense rather than an adjustment to the revenue.

23. Other receipts include, but not limited to, the following:
•Receipts of subsidy from the National Government
a. Notice of Cash Allocation (NCA)
b. Tax Remittance Advice
c. Non-Cash Availment Authority
d. Cash Disbursement Ceiling
OTHER RECEIPTS

24. OTHER RECEIPTS
•Receipts of subsidy or assistance from other government
agencies, including LGUs and GOCCs.The collecting officer
shall issue an official receipt upon receipt of any of these
subsidies/assistance. The journal entries are as follows:
DateCash-Collecting Officers
Subsidy from other NGAs
Assistance from LGUs
Assistance from GOCCs
To recognize receipt of subsidy/assistance
from the other government agencies
100,000
60,000
30,000
10,000
DateCash-Treasury/Agency Deposit,Trust
Cash-Collecting Officers
To recognize remittance of collections to the BTr.
100,000
100,000

25. OTHER RECEIPTS
•Receipts of excess cash advance granted to officers and
employees. (not)
•Receipt of refund of overpayment of expenses.
DateCash-Collecting Officers
Appropriate expense account
To recognize collection of refund of
overpayment of expenses.
10,000
10,000
DateCash-Treasury/Agency Deposit (Regular,
Special Account or Trust)
Cash-Collecting Officers
To recognize remittance of collections to the BTr.
10,000
10,000

26. OTHER RECEIPTS
•Receipts of performance bond or security deposit.
DateCash-Collecting Officers
Guaranty/Security Deposits Payable
To recognize collection of performance
bond/security deposits.
100,000
100,000
DateCash-Treasury/Agency Deposit Trust
Cash-Collecting Officers
To recognize remittance of collections to the BTr.
100,000
100,000
•Collections made on behalf of another entity.

27. OTHER RECEIPTS
•Intra-agency and Inter-agency fund transfers.
Intra-agency Fund Transfer (same)
DateCash-Collecting Officers
Due to (Central Office, Regional Office,
Operating Units or Other Funds)
To recognize receipt of intra-entity fund
transfer.
100,000
100,000
DateCash-Treasury/Agency Deposit Trust
Cash-Collecting Officers
To recognize remittance of collections to the BTr.
100,000
100,000

28. OTHER RECEIPTS
•Intra-agency and Inter-agency fund transfers.
Intra-agency Fund Transfer (different)
DateCash-Collecting Officers
Due to (NGAs, LGUs or GOCCs)
To recognize receipt of intra-entity fund
transfer.
100,000
100,000
DateCash-Treasury/Agency Deposit Trust
Cash-Collecting Officers
To recognize remittance of collections to the BTr.
100,000
100,000

29. reporters:
•Ashraf polog
•Alaisa I. Lucman
•Omicalsom Macapundag
•Waarith Lomondot

30. THANK YOU