Ojf

Republika ng Pilipinas

KAGAWARAN NG KATARUNGAN

Department of Justice

Manila

MEMORANDUM CIRCULAR NO. 00 2TO The Undersecretaries/Assistant Secretaries

Prosecutor General/Chief State Counsel

All Regional/Provincial/City ProsecutorsChiefs of Service/Staff of the Office of the SecretaryAll Concerned

SUBJECT:

DATE

Revised Guidelines on the Settlement of Cash Advance and the

Penalty to be Imposed for Failure of an Accountable Officer toLiquidate Cash Advance Within the Prescribed Period

FEB 0 B 2Q20

Attached is a copy of the Civil Service Commission (CSC) MemorandumCircular No. 23, s. 2019 Issued pursuant to CSC Resolution No. 1900929 dated 13August 2019, entitled "Revised Guidelines on the Settlement of Cash Advance

and the Penalty to be Imposed for Failure of an Accountable Officer to LiquidateCash Advance Within the Prescribed Period."

All are directed to strictly observe the Revised Guidelines.

For strict compliance.

MENARDO ITGUEVARRASecretary

Department of Justice

End.; As stated. i20 DZQ

Cn^SERVKECOMMfSSIONRrpuhiicfff the Philippines

MC No. ^ ̂ . s. 2019

MEMORANDUM CIRCULAR

™ : all heads OE CONSTITUTIONAL BODIES,departments, BL'REAIIS AND AGENCIES OF THENATIONAL GOVERNMENT; LOC AL GOV ERNMENTUNITS; (iOVERNMENT-OVV NED OR CONTROLLEDCORPORATIONS WITH ORIGINAL CHARTERS;STATE COLLEGES AND UNIVERSITIES

SUBJECT : Revised Guidelines on the Settlement of Cash Advanceand the Penalfj to be Imposed for Failure of anAccountable Officer to Liquidate Cash Advance Withinthe Prescribed Period

Pursuant to CSC Resolution No. 190092') dated August 13. 2019. the Commissionresolved to promulgate the tbllovving Revised Guidelines on the Settlement of Cash Advanceand the Penalty to be Imposed for Failure of an Accountable Officer to Liquidate CashAdvance Withm the Prescribed Period which provides, as follows:

"Section /. Definition of Terms.

a. Cash Advances^ - refer r

Revised CiuideliiKs on ihe Seitiemenl ofCiish Advance and ihc IVnaliv lo befniposcd for failure of an AccountablefXTicer lo liquidate Cash AdvanceWitliin the Prescribed PerUKlPage 2 off)

c. Settlement'* means the issuance of ihe Credit Notice by the Auditorafter the (uidit of the littuidation documents.

d. Accountable Officer^ — refers to a public officer or employee who.in the discharge of his office, receives money from the governmentwhich he is bound to later account for. Transfer, separation orretirement from the yovenmwnf does not operate to discharge thesaidper.son from coverage of the definition and corresponding dutyto account for the unlicpiidated cash advances.

e. Formal Demand ~ refers to the notice i.ssued by the Resident COAAuditor to the .Accountable Officer demanding theliquidation settlement ofcash advances.

f. Delay - refers to the failure of the Accoiinfahie Officer to make afull liquidation settlement of cash advances w ithin the prescribedperiod, us stated under COA Circular No. 2012-001 dated June 142012.

g. Gros.s Neglect of Duty^ - refers to negligence characterized by thewant of even slight care, acting or omitting lo act in a situationwhere there is a duty lo act. not inadvertently hut willfully andintentionally, with a conscious indifference to consequences, insofaras other persons may he affected. It is the omis.sion ofthat care thateven inattentive and thoughtless men neverfail to give to their ownproperty.

h. Simple Neglect of Duty^ - means the failure of an employee orofficial to give proper attention to a ta.sk expected of him or her.signifying a di.sregard of a duty resulting from careie.ssness orindifference.

Section 2. Legal Presumption Against Non-Liquidation of Cash Advance.

Article 21./ of the Revised Renal i ode states in unequivocal terms that:

The failure of a public officer to have duly forthcoming anypublic funds or property with which he is chargeable, upon demand byany duly authorized officer, .shall he prima facie evidence that he hasput .such missing funds or property to personal use. "

COA Circular No. 96-004 dated April 19. 1996." COA Circular No. 2012-004 dated November 28. 2012.^ Civil Service Commission vs. Jessie V. Rabang(G,R. No. 167763. March 14. 2008).Office of the Ombudsman vs. Samson de Leon(G.R. No. I.'^4083. February 27. 201.3).

Revised Guidelines on the Settleiiienl ofCash Advance and the I'enalty to beImposed for failure of an AccountableGlCiccr to l iquidate Cash AdvanceWithin the I'restnbed Period

Fajtc 3 ol 6

"Section 3, Settlement and Liquidation of Cash Advance^.

A cash advance is sealed and lic/uidafed either by returning the numevadvanced if unspent, or by the presenttilion of regularly accomplishedvouchers, giving satisfactory detail of the items thereon paid which must he inatcordance with the purpose for which the cash advance my/.v granted, andfurther supported by proper receipts and other evidence of payment, subject tothe result of the post-audit thereof by the auditor concerned.

Section 4. Liquidation of Cash Advances'^

1 he Accountable Officer shall liquidate cash advances within thefollowing period:

4.1, Salaries. Hages. Honoraria and Other Similar Payments. - withinfive 0) calendar days after the end of the day period.

4.2 Field Operating Expenses - within twenty (20) calendar days afterthe end of the year subjeet to replenishment as frequently as necessaryduring the year.

4.3 Petty Cash bund (PCI') as soon as the disbursements reachseventy-five percent (75%) or as needed, the PCb shall be replenishedwhich shall he equal to the total amount of expenditures madetherefrom. In case of termination, resignation, retirement or dismissalof the PCb custodian, immediately thereafter.

4.4 Traveling expenses within thirty (30) calendar days after thereturn of the offieial employee concerned to his official station for localtravel and within sixty (60) calendar days after the return of theofficial/employee concerned to the Philippines in the case of foreigntravel.

4.5 Special Purpose as soon as the purpose of the cash advance hasbeen served.

Section 5. Administrative Liability and the Corresponding Penalty forFailure of the Accountable Officer to Liquidate Cash Advances Within thePrescribed Period.

'' COA Circular No. 2012-004 dated November 28. 2012,Commission on Audit Circular No. 2012-001 dated June 14. 2012.

Revised Guidelines on ihe Seitlcmcnt ofCash Advance and ihc Penalty to heImposed lor I uilure o< an AccountubleOHiccr to l iquidate Cash AdvanceWithin the Prescribed Period

Page 11)1 f)

X —X

5.1 An Accounlahle Officer who. after formal demand by the StaleAuditor or Audit Team Leader. make.'i a fulllicjuidation/settlement payment of the subject cash advance within theprescribed period stated in the formal demand letter, with a validjustification and no a^y^ravatiny circumstances present as enumeratedunder Section 53. Rule 10. 20^ Rules on Administrative Cases in theC ivil Service (lOf RACCS). .shad be ab.solved of any administrativeliability. Absent such valid justification, the Accountable Officer shallhe liable for Simple Nep^iect of Duty and imposed the penaitv ofsu.spension from (he government service for a period of one (I) monthand one (!) day. On the other hand, the penalty of suspension for aperiod of three (3) months shall he imposed if aside from the absenceof such valid justification, there are a^^ravatiny; circumstances presentand no miti^atiny circumstances from which said agyravatinycircumstances may be offset.

5.2 An Accountable Officer who. after formal demand by the Stale.Auditor or Audit Team Leader, makes a partial liquidation of the cashadvance shall he held liable for Simple Seylect of Duty and imposed thepenalty of suspension from the yovernment service for a period of oneill month and one (I) day. provided that all oflhe followiny conditionsare complied with:

a. the partial liquidation ofnot less than fifty percent (50%) ofthe total unliquidated cash advance m'^.v made within theprescribed period stated in the formal demand letter:

h. the .Accountable Officer is able to present justifyinycircumstance explaininy why only partial liquidation w

Revised Guiileliiies on the Settlement of

Cash Advance and the Penalty to beimposed for I ailure of an Accouniabic

Officer to l iquidate Cash AdvanceW ithin the Prescribed Period

Pauc 5 of 6

X— -

5.3 An Accouniahlc Officer who. afier formal demand hy ihe StateAuditor or Audit Team Leader, makes a partial lUpiidation of the cashadvance .shall be held liable for Simple .Meglecf of Duty and imposed thepenalty of suspension from the government service for a period of three(3) months, provided that all of the following conditions are compliedwith:

a. the partial Ihpiidation of not less than fifty percent (50%) ofthe total unliquidated cash advance was made within theprescribed period stated in the formal demand letter:

h. the Accountable Officer fails to present any justifyingcircumstance explaining why only partial liquidation wasmade:

c. the Accountable Officer has the intention of fully liquidatingthe cash advances such as by resorting to a .salary deductionscheme, or executing a promissory note to pay theunliquidated portion of the cash advance: and

d. no aggravating circumstances are present as enumeratedunder Section 53. Rule 10. 2017 RACCS, otherwise the

penalty of suspension for a period ofsix (6) months shall beimposed.

5.4 An Accountable Officer shall be held liable for Gross Neglect ofDuty and imposed the penalty of dismissal from the .senice for the firstoffense in any of the following instances:

a. the Accountable Officer who. after formal demand by theState Auditor or Audit Team Leader, fails to make anyliquidation, whether partial or full, of the cash advanceswithin the prescribed period stated in the formal demandletter:

b. the Accountable Officer who. after formal demand by theSlate .-iuditor or Audit Team Leader, makes partialliquidation (regardless of the amount) of the cash advancebut failed to present any Justifying circumstance and has nointention to fully liquidate: and

c. the Accountable Officer mentioned in Sections 5.2 (c) and5.3 (c) defaulted in the payment of the unliquidated cashadvance.

Revised (iiiidelincs t>n rtie Setlicmcnt ofCash Advance and ihc J'cnalu lo beImposed for failure of an AccoimtahicOltlcei lo Liquidate fash AdvanceW ithin the Prescribed PeriodPage f> ofhX

•X

Section 6. Repeating Clause,

n . f issucmces of the Commission that are in conflict with theseHeviseti Uwdchnes are deemed modified, revised or repealed accordingly.

Section 7. Effectivity.

r. -.v ' ^ takes effect fifteen (15) davs after the publicationclii/Lfr ofg^-^nera!

Resolution No. 1900929 dated August 13. 2019 was published inI he I hilippine Star" on September 7. 2019. and shall take eJTect after Ofteen

(15) days trom its publication.

ALItlAMa^OSA-BALAChairperson

aWLSRVKIGOMMJSSfON

R?-!iS!bh( of Hn- Pii'l'pi/iiiCT'

Revised Guidelines un the Settlementof Cash Advance and the Penalt> to beImposed for Failure of an AccountableOfficer to Liquidate Cash AdvanceWithin the Prescribed Period

Number: 1900323

Promulgated:1 3 AUG 2019

RESOLUTION

WHEREAS, Section 27. Article 11 of the 1987 Constitution provides that it shall bethe policy ol the State to maintain honesty and integrity in the public service and take positiveand efTective measures against graft and corruption:

WHEREAS, Section 12 (2). Chapter 3. Title i. Subtitle A, Book V of theAdministrative Code of 1987 (Executive Order No. 292) empowers the Civil ServiceCommission (CSC) to prescribe, amend and enforce rules and regulations to carry into elTectthe provisions of the Civil Service Law and other pertinent rules:

WHEREAS, the C^SC. together with the Commission on Audit (COA) and Office ofthe Ombudsman, forged a Joint anti-corruption plan called the Solana Covenant in 2004 tohelp and support each other in fighting corruption. As part of their collective action, the three(3) constitutional bodies idenlilled the need to strictly implement the rules on liquidation ofcash advances as this has become a source of graft and corruption in the bureaucracy. Eachconstitutional body issued parallel circulars to monitor and impose necessary sanctionsregarding violations of the guidelines on liquidation of cash advances:

WHEREAS, the CSC issued CSC Resolution No. 04-0676 dated .iune 17. 2004entitled "Policy Guidelines to Govern the Liquidation of Cash Advances and the Penalty tohe Imposed for Failure of an Accountable Officer to Liquidate Within the PrescribedPeriod", providing for the rules governing the liquidation of cash advances in aggregateamounts of Fifty Thousand Pesos (Php50.000.00) and above per accountable officer and thepenally to be imposed for failure to liquidate within the prescribed period;

WHEREAS, the CSC. in order to conform with Supreme Court jurisprudence, aswell as set parameters in determining the administrative liability of the concernedaccountable officer, issued CSC Resolution No. 1200103 dated January 12. 2012, amendingRule V of CSC Resolution No. 04-0676 and providing, as follows:

Bawat Kawani, Lingkod Bayani9CSC Building. IBP Road, Balasan Hills, 1126Quezon City W (02) 931 -7935/(02)931-7939/(02) 931-8092 }!^c5Cphi}@c5c,gov.ph # www.csc.gov.ph

Revised Guidelines on the Penalty to be Imptwedtor failure of an Accountable Gfficer to LuiuidateCash Advance Wiihm the Prescribed PeriodPage 2 of^

'WOff, THEREFORE, the C'ummission hereby RESOLVES laamend Ride V aj CSV Resoiulum No. 04-06'76 dated June r. 2004, asfollows:

"RULE V. ADMINISTRATIVE LIABILITY

"Section 8. The failure of an Accountable Officer to render an accountin fidl within the periods prescribed and after formal demand shall constitutethe administrative offense of Gross Neglect o f Duty punishable by dismissalfrom the service for the first offense. Full Ikfuidation/settlemeiWpayment ofthe subject cash ach'ance outside the given periods .shall constitute the offen.seof Simple Neglect of Duty punishable by suspension from the senuce for one(I) month and one (I) day to six (6) months for the first offense, and dismissalfrom the sen'ice for the second offense "

WHEREAS, there is a need to issue a revised comprehensive guidelines in order toimpose a more just schedule of penalties tor the administrative offense committed taking intoaccount the var>'ing circumstances surrounding the failure to liquidate cash advances:

WHEREFORE, the Commission RESOLVES lo promulgate the following revisedguidelines on the settlement of cash advance and the penalty to be Imposed for failure of anaccountable officer to liquidate cash advance within the prescribed period:

Section I. Definition of Terms.

a. Cash Advances' - refer to advances granted to otTicers andemployees which may be classified into: (a) regular cash advances-and (b) special cash advances^.

b. Liquidation'^ - means the recording of the liquidation documentsin the bot^ks of accounts by the accountant as a credit to the cashadvance account after verifying the same, although not yet auditedby the auditor.

c. Settlement'^ - means the issuance of the Credit Notice by theAuditor after the audit of the liquidation documents.

Commission on Audil (CX)A) Circular No. 90-;i31 dalcd Ma> 3, |990.- Ihose granted to cashiers, disbursing officers, paymasters and/or property.supply officers for salaries andwages, commuiable allowances, honoraria and other similar payments and petty cash operating expenses.' I htjsc granted on the explicit authority of the agency heads to duly designated disbursing officers oremployees for other legally authorized purposes.■* CO.\ Circular No. 96-004. April 19. 1996.' C(3A Circular No. 96-004 dated April 19. |

Rcvisctl Guidelmes on the Penully to he Imposedfor Failure ol an Accountable Otficer to LiquidateCash Advance Within the Prescribed PeriodPage 3 of 7

^

d. Accountable Officer'' — refers to a public oftlcer or employeewho, in the discharge of his/her office, receives money from thegovernment which he/she is bound to later account for. Transfer,separation or retirement from the government does not operate todischarge the said person from coverage of the definition andcorresponding duty to account for the unliquidated cash advances.

e. Formal Demand - refers to the notice issued by the ResidentCOA Auditor to the Accountable Officer demanding theliquidation/settlement of cash advance.

f. Delay - reters to the failure of the Accountable Officer to make afull liquidation/settlement of cash advances wiihin the prescribedperiod, as staled under COA Circular No. 2012-001 dated June 14.2012.

g. Gross Neglect of Duty"' - refers to negligence characterized by thewant of even slight care, acting or omitting to act in a situationwhere there is a duty to act, not inadverientl) but willfully andintentionally, with a conscious indifference to consequences,insofar as other persons may be affected. It is the omission of thatcare that even inattentive and thoughtless men never fail to give totheir own property.

h. Simple Neglect of Duty® - means the failure of an employee orofficial to give proper attention to a task expected of him or her.signifying a disregard of a duly resulting from carelessness orindifference.

Section 2. Legal Presumption Against Non-Liquidation of Cash Advance.

Article 217 of the Revised Penal Code states in unequivocal termsthat:

"The failure of a puhUc officer fo have duly forihcoming anypublic funds or properly with which he is chargeable, upon demand byany duly authorized officer, shall he primu facie evidence that he hasput such missing funds or property to personal use. "

" COA Circular No. 2012-()()4 dated November 28. 2012.

^ Civil Service Commission vs. Jessie V. Rabang (

Revised Guidelines on the Penalty to be Imptwedfor Failure ofan Accountable Gfllcer In i iquidaleCash Advance Witlnii the Prescribed PeriodPage 4 nf'.V

Section 3. Settlement and Liquidation of Cash Advanced

A cash advance is settled and liquidated either by returning the moneyadvanced if unspent, or by the presentation of regularl> accomplishedvouchers, giving satisfactory detail of the items thereon paid which must be inaccordance with the purpose for wliich (he cash advance was granted, andfurther supported by proper receipts and other evidence of payment, subject tothe result of the post-audit thereof b> the auditor concerned.

Section 4. Liquidation of Cash Advancivs'^

The Aceoiinlable Officer shall liquidate cash advances within thefollowing period:

4.1. Salaries. Wages. Honoraria and Other Similar Payments. - withinfive (5) calendar days after the end of the day period.

4.2 field Operating Expenses - within twenty (20) calendar days afterthe end of the year subject to replenishment as frequently as necessaryduring the year.

4.3 Petty Cash I'und (PCF) as soon as the disbursements reachseventy-five percent (75%) or as needed, the PCF shall be replenishedwhich shall be equal to the total amount ol' expenditures madetherefrom. In case of termination, resignation, retirement or dismissalof the PCF custodian, immediately ihereaiter.

4.4 Traveling expenses - within thirty (30) calendar days afier thereturn of the official/employee concerned to his oflicial station forlocal travel and within sixty (60) calendar days after the return of theofficial/employee concerned to the Philippines in the case of foreigntravel.

4.5 Special Purpose as soon as the purpose of the cash advance hasbeen served.

Section 5. Administrative Liability and the Corresponding Penalty forFailure of the Accountable Officer to Liquidate Cash Advances Withinthe Prescribed Period.

COA Circular No. 2012-004 dated November 28. 2012.

Commission on Audit Circular No. 2012-001 dated June 14. 2012,

Revised (iuidelines on tite Penalty to be Imposedfor Failure of an Accountable Officer to l.iquidaleOash Advance Within the Prescribed PeriodPage 5 nf7X- •X

5.1 An Accountable Officer who. after formal demand by the StateAuditor or Audit Team Leader, makes a fullliquidation/settlement/payment of the subject cash advance within theprescribed period stated in the fonnal demand letter, with a validjustification and no aggravating circumstances present as enumeratedunder Section 53. Rule 10, 2017 Rules on Administrative Cases in theCivil Service (2017 RACCS), shall be absolved of any administrativeliability. Absent such valid justification, the Accountable Officer shallbe liable for Simple Neglect of Duty and imposed the penalty ofsuspension from the government service for a period of one (1) monthand one (1) day. On the other hand, the penalty of suspension for aperiod ol three (3) months shall be imposed if. aside from the absenceof such valid justification, there are aggravating circumstances presentand no mitigating circumstances from which said aggravatingcircumstances may he offset.

5.2 An Accountable Officer who, after formal demand by the StateAuditor or Audit Team Leader, makes a partial liquidation of the cashadvance shall be held liable for Simple Neglect of Duty and imposedthe penalty of suspension from the government service for a period ofone (1) month and one (1) day. provided that all of the followingconditions are complied with:

a. the partial liquidation of not less than fifty percent (50%) ofthe total unliquidated cash advance was made within theprescribed period stated in the formal demand letter:

b. the Accountable (Officer is able to present justifyingcircumstance explaining why only partial liquidation wasmade:

c. the Accountable Officer has the intention of fullyliquidating the cash advances such as by resorting to asalary deduction scheme, or executing a promissor>' note topay the unliquidated portion of the cash advance; and

d. no aggravating circumstances are present as enumeratedunder Section 53, Rule 10. 2017 RACCS. or in case there

are aggravating circumstances, the same shall be offset bythe number of mitigating circumstances present. However,in the event that there are aggravating circumstancespresent and no mitigating circumstances from which saidaggravating circumslancc.s may be

Revised Ciuidelines on ihe Penalt\' to be Imposedlor Failure of an Aecountable OlTicer to l iquidatefash Advance Within iJrc I'rescnbcd PeriodPeigv 6 u/ 7X

5.3 An Accountable OlTiccr who. alter fomtal demand by the SlateAuditor or Audit Team Leader, makes a partial liquidation of the cashadvance shall be held liable for Simple Neglect of Duty and imposedthe penalty of suspension from the government sendee for a period ofthree (3) months, provided that all of the following conditions arecomplied with:

a. the partial liquidation of not less than fifty percent (50%)of the total unliquidated cash advance was made within theprescribed period slated in the formal demand letter:

b. the Accountable Officer fails to present any justifyingcircumstance explaining why only partial liquidation wasmade:

c. the Accountable OfUcer has the intention of fullyliquidating the cash advances such as by resorting to asalary deduction scheme, or executing a promissory note topa) the unliquidated poiiion of the cash advance; and

d. no aggravating circumstances are present as enumeratedunder Section 53. Rule 10. 2017 RACCS. otherwise the

penalty of suspension for a period of six (6) months shallbe imposed.

5.4 An Accountable Officer shall be held liable for Gross Neglect ofDuty and imposed the penalty of dismissal from the service for thefirst otTense in any of the following instances:

a. the Accountable Officer who, after formal demand by theSlate Auditor or Audit Team Leader, fails to make anyliquidation, whether partial or full, of the cash advanceswithin the prescribed period slated in the formal demandletter;

b. the Accountable Otficor who. after formal demand by theStale Auditor or Audit Team l.eadcr, makes partialliquidation (regardless of the amount) of the cash advancebut failed to present tmy justifying circumstance and has nointention to fully liquidate: and

c. the Accountable Officer mcniioncd in Sections 5.2 (e) and

5.3 (e) defaulted in the payment of the unliquidated cashadvance.

Revised Guidelines on (he PenaltV' to be Imposedfor Failure of an Accountable Officer lo LiquidateCash Advance Wiihin the Prescribed Period

Page 7 of 7X X

Section 6. Repealing Clause.

Any previous issuances of the Commission thai are in conflict with thisGuidelines are deemed modified, revised or repealed accordingly.

Section 7. Effectivity.

These Guidelines shall take effect fifteen (15) days after its publication in anewspaper of general circulation.

Quezon City.

ALICIA dda ROSA-BALA

Chairperson

LEOPOLDO\ROBERTO W. VALDEROSA, JR.Commissioner

AILEEN LOIJRDES

Commissions

IZADA

Attested bv:

ODOLORESyB. BONIlDirector IV

Commission Secretariat and Liaison Ofllce

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f'olin Re^iiliinnn