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Chapter 1

THE PROBLEM AND ITS SETTINGS

Introduction

The term “barangay” under the Local Government Code of 1991 is not just a

formality. The present barangays in the Philippines, as headed by the Punong Barangay,

have defined powers in order to enhance their existence as an autonomous part of the

municipality. They have executive, legislative and power to resolve disputes within the

purview of the Local Government Code of the Philippines. The expansion of powers of the

barangays made its role as one of the most important sectors of the local government

unlike the barrios before that were considered as just territorial or symbolic identification of

a specific geographic location. It could be confirmed that the present barangays have

active participation in political and economic activities of the country.

As a basic political unit, the barangay serves as the primary planning and

implementing unit of government programs, policies, projects, plans and activities in

community. It was the earliest form of government in the Philippines. It originated from the

Malayan term, “balangay” which means sailboat. However, this term does not mean a

sailboat anymore, rather it pertains to a political structure which was governed by a datu in

Pre-Spanish Era. The datu, being the leader of barangay, was given the authority to collect

tributes or buwis in the form of farm products. Upon the arrival of the Spaniards, smaller

barangays were combined to form towns led by the cabeza de barangay (barangay chief)
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who also collected taxes called tribute from the residents from the authority given by the

Spanish monarch.

Nowadays, the term datu and cabeza de barangay changed into barangay chairman

who was appointed through election by the votes of the residents. Unlike before, the

function of the barangay chairman today is not to collect taxes, because the National

government assigned this particular role to Bureau of Internal Revenue. Instead the

Punong Barangay, with the coordination of Barangay Development Council, is responsible

for the budget preparation and execution of barangay funds. Since there is segregation of

duties, it can be said that there is a more systematic way in managing the funds for the

general welfare of the community.

As the smallest unit of government, having sufficient barangay budget is a part of the

financial plan to provide services for public welfare. Aside from being a financial plan, the

barangay budget serves as an instrument for barangay officials to effectively manage the

development of the barangay. Establishing a well-prepared barangay budget serves as

basis for planning and policy adoption, program and project implementation, financial

control, and management information.

With the issues regarding the barangay fund’s susceptibility to theft, several

barangay officials are often involved in various cases of mismanagement and misuse of

barangay budget. In fact, recently, a barangay captain and treasurer of Lapu-Lapu City

was held for trial for alleged falsification and violation of Republic Act 3019 (Anti-Graft and

Corrupt Practices Act) for committing irregularity in the disbursements of funds amounting

to P1.7 million.

On January 1, 2002, Commission on Audit, in exercise of the authority granted under

Article IX-D of the 1987 Constitution, prescribed the New Government Accounting System
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(NGAS) which was implemented for all Local Government Units except the barangays. To

simplify the procedures and reporting of the financial transactions of the barangays, COA

also prescribed the adoption of the NGAS for the Barangay level with the Accounting

Circular No. 2006-002 dated December 19, 2006 is revised. New manual was

implemented to replace the "Barangay Accounting Manual" covered under COA Circular

No. 93-396 dated April 15, 1993. With the implementation of the New Government

Accounting System (NGAs) in the barangays, the need for simplified procedures and

reporting of the financial transactions of the barangays were addressed.

The reasons of the shift to NGAS are to adopt an accounting system that conforms

with the International accounting, to computerize the accounting systems, to prepare

regular and routinary financial reports, and to use the generated financial reports as tools

of management in decision making.

As a result of the implementation of NGAs, it helped in guiding the collections,

appropriations, and expenditures of the barangay budget. Moreover, Sections 329-334

(Barangay Budget) of the Local Government Code of 1991 (RA No. 7160) provide the

basis for the collection, safekeeping and use of barangay funds. The aforesaid provisions

govern the preparation, effectivity, and review of the barangay budget, including the

financial procedures that the barangay shall observe.

Due to various issues and opinions regarding inefficient usage of barangay’s budget,

it is a fact that people are still unaware with how the funds are being managed by local

officials. With this, it is in the perception of the authors that barangay units have more to

improve with its financial management practices. This study will assess the level of

implementation of financial management practices of barangays in Sta. Mesa in

accordance to New Government Accounting System (NGAS).

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Theoretical Framework

RA 7160 otherwise known as the Local Government Code of the Philippines,

establishes the system and defines powers of provincial, city, municipal and barangay

governments in the Philippines. It provides for a more responsive local government

structure instituted through a system of decentralization whereby Local Government Units

are delegated more powers, authority, responsibilities and resources.

According to Section 304 of RA 7160, Tittle V – Local Fiscal Administration shall

govern the conduct and management of financial affairs, transactions, and operations of

provinces, cities, municipalities, and Barangays.

The Article II, Sec. 329-334 (Barangay Budget) of the Local Government Code of the

Philippines states that: “Matters governing barangay budget, funds, and financial

procedures, Sections 329 to 334, Article II of the Local Government Code are relevant and

controlling as this Code expressly mandated the Commission on Audit (COA) to prescribe

the procedures relative to barangay financial matter.” It provides the basis for the

collection, safekeeping and use of barangay funds. The aforesaid provisions govern the

preparation, effectivity, and review of the barangay budget, including the financial

procedures that the barangay shall observe.

Section 334(c) of RA 7160 states that: “The financial records of the barangay shall

be kept in the office of the city or municipal accountant in simplified manner as prescribed

by the Commission on Audit”. In pursuance of said mandate, the Commission on Audit

(COA) issued Circular No. 93-395 providing for the use of the 'Barangay Accounting

Manual'. This was later on replaced by the 'Systems and Procedures Manual on the

Management of Barangay Funds and Property and Accounting System Manual for
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Barangays under the New Government Accounting System (NGAs) as provided under

COA Accounting Circular No. 2006-002 dated 19 December 2006.

The Manual prescribed in COA Accounting Circular No. 2006-002 dated December

19, 2006 is revised to simplify the procedures and reporting of the financial transactions of

the barangays, to maintain and keep the accounting records in accordance with the

requirements of law and to prepare and submit the yearend financial statements.

The Commission on Audit (COA) under the 1987 Constitution of the Philippines

prescribed the adoption of the New Government Accounting System (NGAs) for the

Barangay level that was implemented beginning the fiscal period, 1987.

According to the provisions of NGAS, financial management practices of the

barangays shall be governed by the fundamental principles mentioned therein. The budget

of the barangay shall be approved by the Sangguniang Barangay (SB) and shall be known

as barangay appropriation ordinance which shall serve as the authorization for the

barangay to incur expenditures and obligations.

Moreover, the Chairman of the Committee on Appropriations (CCA) shall be

responsible for the proper monitoring and control of the barangay budget. The Barangay

Treasurer (BT), however, shall be responsible for the proper handling and disbursements

of the barangay funds pursuant to existing laws, rules and regulations.

In addition, management and accounting for the procurement, issuance and

utilization/location of supplies and materials; and property, plant and equipment is

necessary for the proper documentation, monitoring and control. The BT shall act as the
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Supplies and Property Officer of the barangay and shall be responsible for the receipt,

upkeep, issuance and physical inventory of barangay property.

Conceptual Framework

This study will use the following inputs containing the leading variables. This includes

the barangay officials profile as to name which is optional, age, sex, educational

attainment, present position in the barangay, and the respondent’s length of experience in

the barangay.

Meanwhile, the barangay’s profile consisted of their barangay number, annual

barangay budget or Internal Revenue Allotment (IRA) and the number of residents residing

in the barangay. Also, included is the level of implementation of financial management

practices of the barangay and the problems encountered by the barangay’s

implementation of financial management practices in accordance to New Government

Accounting System.

The second frame contains the processes utilized to acquire data through survey

questionnaires and analyze the variables through statistical techniques, it is the analysis,

presentation and Interpretation of data gathered through questionnaire.

The output frame contains result of the processes input that will direct the

conclusions and recommendations of the study. The arrows show the flow of information in

the research process. The feedback loop connects the output to the inputs, thus creating a

continuous system.
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INPUTS PROCESS OUTPUTS

Respondent’s Profile
Name (optional)
Barangay
Present Position
Sex
Age
Educational Attainment Data gathering
Length of Experience in and processing
Government Service

Barangay Profile Determining the

-Barangay Number problems
encountered by
-Annual Barangay budget the barangay’s
or Internal Revenue implementation of
Allotment financial
management
-Number of residents practices in
accordance with Assessed
New Government
Accounting level of
Level of implementation of implementation of
System
NGAS financial management
Fundamental Principles practices of the
barangay in
Analysis, accordance to New
Appropriations and
Presentation and Government
Obligations
Interpretation of Accounting System
Collections and data gathered
Deposits/Remittances through
questionnaire
Disbursements
Supplies and Materials
Property, Plant and
Equipment/Infrastructure
Assets
Problems encountered by
the barangay’s
implementation of
financial management
practices in accordance
with New Government
Accounting System FEEDBACK
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Statement of the Problem

This study aimed to assess the level of implementation of financial management

practices of barangays in Sta. Mesa in accordance to New Government Accounting

System (NGAS).

This study specifically seeks answers to the following questions:

1. What is the profile of the barangays’ respondents in terms of the following:

1.1. Profile of Individual Respondents

1.1.1. Age

1.1.2. Sex

1.1.3. Educational Attainment

1.1.4. Present Position

1.1.5. Length of Experience in Government Service

1.2. Profile of Barangay where the individual respondent is residing

1.2.1. Barangay Appropriation/Budget or Internal Revenue Allotment

(IRA)

1.2.2. Number of Residents

2. What is the level of implementation of NGAS in the financial management

practices of barangay in terms of the following:

1. Fundamental Principles

2. Appropriations and Obligations

3. Collections and Deposits/Remittances

4. Disbursements

5. Supplies and Materials

6. Property, Plant and Equipment/Infrastructure Assets

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3 Is there a significant difference in the respondents’ level of implementation of the

barangay's financial management practices according to NGAS when they are

grouped according to their profile?

4 What are the problems encountered by the respondents’ in the implementation

of NGAS on the financial management practices of the barangays?

5 Is there a significant difference on the problems that the respondents

encountered about the implementation of financial management practices of

barangays in Sta. Mesa, Manila when they are grouped according to their

profile?

Hypotheses

This study tested the following hypotheses at a 0.05 level of significance:

1. There is no significant difference on the level of implementation of barangays’

financial management practices according to NGAS when they are grouped

according to their profile.

2. There is no significant difference on the problems that respondents

encountered about the implementation of NGAS in the financial management

practices of barangays in Sta. Mesa Manila when they are grouped according

to their profile.

Scope and Limitation

The study was about providing the general understanding about the conformity with

the New Government Accounting System of the barangays located at Sta. Mesa, Manila,
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the extent to which budgetary control principles are employed to enhance financial

management.

In conducting the study, the researcher expects to face time constraints due to

shortage of time to conduct the study extensively and intensively. Also, there may be poor

responses. Since budgeting is a sensitive issue and it involves financial matters, some

respondents failed to provide the researchers the information requested, hence, lack of

sufficient information may hinder the researchers to complete the study effectively. The

researchers dealt with this by assuring respondents of confidentiality. The capacity of the

respondents also limits the study because the researchers need first to translate the

questions in a language they can better understand.

Another limitation is availability of the respondents. Some respondents still have

other responsibilities aside from being barangay officials, thus, they are sometimes not

available to answer the questionnaire prepared by the researchers.

Lastly, some respondents are not willing to answer the questionnaire because they

seem to be afraid that the survey will be used against them.

Significance of the Study

This study significantly contributes to the following:

Barangay Officials. The outcome of the research is beneficial to the Barangay

Officials. This research will assess the level of implementation of New Government

Accounting Manual System with their respective barangays. After evaluation, this may lead

in barangay officials to take corrective actions on whatever deviations they encountered in

accomplishing the manual.

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Public. The outcome of the research is beneficial to the Public. The public placed

their trust to the responsible officials in managing the financial practices of the barangays.

This research will assess whether the responsible barangay officials maintain and keep the

accounting records of their respective barangays in accordance with the requirements of

New Government Accounting Manual System. This may lead for the public to end or start a

doubt to their entrusted barangay officials as to the latter’s financial management

practices.

Commission on Audit. The outcome of the research is beneficial to Commission on

Audit (COA). COA has the exclusive authority to define the scope, techniques and

methods of its auditing and examination procedures. This research will evaluate the level

of implementation of New Government Accounting System which is prescribed in COA

Accounting Circular No. 2006-002 dated December 19, 2006. The result of assessment

may then be used by COA to prevent and disallow irregular, unnecessary, excessive,

extravagant or unconscionable expenditures, or uses of government funds and properties.

Future Researchers. The outcome of the research is beneficial to the Future

Researchers. This research may be one of the foundations for a new assessment of

implementation of government manual in any local government units. This research will

also indulge the present researchers in the importance of literacy in all aspects including

the said topic of this research.

Definition of Terms

For further understanding of the study, the researchers operationally and

conceptually defined the following terms as used in this study:

Age. This refers to number of years that the barangay official has lived for.
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Appropriation. This refers to an authorization made by ordinance directing the

payment of goods and services from barangay funds under specified conditions or for

specific purposes.

Barangay. The smallest administrative division in the Philippines and is the native

Filipino term for a village, district or ward.

Barangay Treasurer. Responsible for collecting all taxes, fees, and other charges

due and contributions due or accruing to the barangay, and record them in the books of

accounts under the general fund.

Budget. This is an estimate of income and expenditure for a set period of time.

Chairman of the Committee of Appropriations (CCA). This refer to the one

responsible for the proper monitoring and control of the barangay budget.

Collection. This is the process of recovering amounts accruing to the barangay.

Deposits. This is the sum of money placed or kept in an authorized government

depository bank.

Disbursement. It is the act of paying out or disbursing money of the barangays.

Educational Attainment. This refers to the highest degree of education the

barangay official has completed.

Financial management. It refers to the efficient and effective management of

money or funds in such a manner as to accomplish the objectives of the barangay.

Fundamental Principles. These are the principles from which other principles of

financial management practices of barangays can be derived.

Implementation. How NGAS is being applied and used in the financial management

practices of barangays.
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Income. This refers to all revenues and receipts collected or received forming the

gross accretions of funds of the barangays.

Internal Revenue Allotment (IRA). This is a barangay’s share of revenues from the

Philippine national government.

Length of Experience. This refers to the number of years that the official has

served the government.

Level. The intensity or degree of application and usage of NGAS by the barangay.

Local Treasury. It is a place where the funds of the local government are

deposited, kept, and disbursed.

New Government Accounting System (NGAS). This presents the basic

accounting policies and principles that is used by barangays in preparing the general

purpose financial statements as well as reporting of budget, revenue and expenditure in

accordance with laws, rules and regulations.

Number of residents. This refers to the total number of persons inhabiting

a barangay.

Obligations. This refer to an amount committed to paid by the barangay for any

lawful act made by an accountable officer for and in behalf of the barangays involved.

Practice. To carry out or perform the financial management habitually or regularly.

Present Position. This refers to the officials’ rank or status in the barangay.

Property, Plant and Equipment. It is tangible items that are expected to be used in

more than one period and that are used in production, for rental, or for administration of

the barangays.
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Punong Barangay. Commonly known as the Barangay Captain and less commonly

Barangay Chairman, is the highest elected official in a barangay, the smallest of the

elected administrative divisions of the Philippines.

Receipts. This refer to income realized from operations and activities of the

barangays or are received by it is the exercise of its corporate functions, consisting of

charges for services rendered, conveniences furnished, or the price of a commodity sold,

as well as loans, contributions or aids from other entities, except provisional advances for

budgetary purposes.

Remittances. The action of sending money to the authorized depository bank or

local treasury.

Revenue. This refers to income derived from the regular system of taxation enforced

under authority of law or ordinances and as such, more or less regularly every year.

Sex. Either of the two main categories (male and female) into which barangay

officials are divided on the basis of their reproductive functions.

Supplies and Materials. This means tangible property that is used or consumed in

barangay operations.
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CHAPTER 2

REVIEW OF RELATED LITERATURE AND STUDIES

This chapter presents the review of the related literature, studies, theories and

definitions beneficial for the thorough understanding of this study, both from local and

foreign sources. This also includes the synthesis of this study which aims to assess the

level of implementation of financial management practices of barangays in Sta. Mesa in

accordance to New Government Accounting System (NGAs).

Understanding the Concept of Barangay

Barangay, as defined by Miriam-Webster dictionary, is a unit of administration in

Philippine society consisting of from 50 to 100 families under a headman. It is

otherwise defined in Section 384 of Republic Act No. 7160 also known as the Local

Government Code of 1991, as a basic political unit that serves as the primary planning and

implementing unit of the government policies, plans, programs, projects and activities, in

the community and as a forum wherein the collective views of the people may be

expressed, crystallized and considered, and where disputes may be amicably settled.

As stated in Section 386 of the above mentioned Code, a barangay maybe created

out of a contiguous territory which has a population of at least two thousand (2,000)

inhabitants as certified by the National Statistics Office except in cities and municipalities

within Metro Manila and other metropolitan political subdivisions or in highly urbanized

cities where such territory shall have a certified population of at least five thousand (5,000)

inhabitants: Provided, that the creation thereof shall not reduce the population of the
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original barangay or barangays to less than the minimum requirement prescribed herein.

According to Institute Politics Governance (2008), the barangay is the smallest and lowest

political unit in the whole of the bureaucracy of government.

Rep. Edcel C. Lagman mentioned in his speech at the 2007 Oath Taking

Ceremonies of Barangay Officials of the First Congressional District of Albay barangay,

barangay as the smallest government unit, serves as the foundation on which the rest of

the state’s institutions are built. Furthermore, he stated that if we are to progress as a

nation, it is necessary that the foundation of our government be firm lest the whole

structure crumbles. This shows that the barangay is indeed the smallest yet the greatest

political unit. He also claimed that the barangay is the principal link of the people to the

municipal, provincial, and national government.

Barangays are the closest level of government to the people. As such, they are

responsive to the needs of their constituents compared to the higher levels. Barangays

have the highest potential for mobilizing the people, for participating in their own

governance and development to enhance their quality of life.

Comelec Commissioner Luie Guia said the barangay is “where you can feel your

government directly and how government affects your life.” Being the smallest unit of the

society, the barangay serves as the link to communities and is the first to respond in times

of calamities while the barangay chairman (village chief) serves as the “mayor” of the

community (Cave, 2013).

The Sangguniang Barangay known commonly as the Barangay Council, and

formerly as the Rural Council and then the Barrio Council, is the legislative body of a

barangay. It passes ordinances and resolutions for the effective administration of the

barangay. Its powers and functions are defined by the Local Government Code of 1991.
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The council is headed by the punong barangay and is composed of seven (7) barangay

kagawads or members, a barangay secretary and a barangay treasurer. The secretary and

treasurer are mandatory appointive officials of the barangay while the punong barangay

and the sangguniang barangay members are elected at large.

About the election of barangay officials, Section 7 of the Batas Pambansa Bilang 22

states that no person shall be eligible to be a barangay official unless he is a citizen of the

Philippines, a registered voter and actual resident of the barangay for at least six months

immediately preceding the election, able to read and write and, on the date of the election,

is least twenty-one years of age, and who is not otherwise disqualified by law. With regards

to the length of term of barangay officials, Section 3 of the aforementioned law expresses

that the term of office of the barangay officials elected under this Act shall be six years,

which shall commence on June 7, 1982 and shall continue until their successors shall have

been elected and shall have qualified.

According to Melodias (2007), the punong barangay is probably the most important

person in the barangay. The barangay generally rises and falls in the character, attitude,

perception and prejudices, priorities and vision of the punong barangay. His leadership

could chart a new path, a better destiny for the barangay or it could simply prevent the

barangay or it could simply prevent the barangay from evolving and remain where it has

always been.

Meanwhile, according to Institute Politics Governance (2008), the punong barangay

technically is the most powerful officials of the barangay as he or she exercises executive,

legislative and judicial powers. As chief executives, the punong barangay implements

ordinances, resolutions, and policies set forth by the barangay as well as national laws.
 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 18

The punong barangay is mandated to ensure the basic services and facilities are delivered

to the community and its people.

Barangay kagawad helps enforce all local policies, projects, programs and

procedures within the barangay. They contribute in constructing provisions and ordinances

for the betterment and development of their respective barangay. Their responsibilities

include eliminating any illegal transactions such as drugs and drug addiction, preserving all

infrastructures and properties, conserving cleanliness, encouraging the welfare of the

youth and ensuring peace and order within the community. As stated by Institute Politics

Governance (2008), the barangay kagawads shall assist the punong baranagay in the

discharge of his/her duties and functions. They shall also act as a peace officers in the

maintenance of public order and safety, and perform such other duties and responsibilities

as the punong barangay may delegate.

Another barangay official is the barangay secretary which shall be appointed by the

punong barangay with the concurrence of the majority of all the sangguniang members.

Another very important person in the barangay is the barangay treasurer. Barangay

treasurer is one of the two mandatory appointive officials of the barangay. The barangay

treasurer is appointed by the barangay chairman in accord with the majority of the

councilors of the Sangguniang Barangay.

The Factors of Barangay Governance and Administration

Governance is all of the processes of governing, whether undertaken by

a government, market or network, whether over a family, tribe, formal or informal

organization or territory and whether through the laws, norms, power or language of an

organized society (Bevir, 2013). Furthermore, according to Huffy (2011), it relates to "the

 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 19

processes of interaction and decision-making among the actors involved in a collective

problem that lead to the creation, reinforcement, or reproduction of social norms and

institutions.

On the other hand, public administration is the implementation of government

policy and also an academic discipline that studies this implementation and prepares civil

servants for working in the public service. According to UN Economic and Social Council

(2007), public administration is "centrally concerned with the organization of government

policies and programmes as well as the behavior of officials (usually non-elected) formally

responsible for their conduct" UN Economic and Social Council. Committee of Experts on

Public Administration. Definition of basic concepts and terminologies in governance and

public administration. 2007

Apart from leader behavior, which has been found to be an important determinant for

leadership effectiveness in the literature, age is considered to be another important

determinant. Drawing upon the early trait theories a leaders’ chronological age is one of

the most important demographic factors in relation to effectiveness. According to

Boerrighter (2015) older leaders are not better or worse than younger leaders in achieving

effective leadership. This is supported by a journal, the Leadership Quarterly, noting that

people preferred the younger looking leader for change and the older looking leader for

stability.

Ages between 26 and 55 years are said to be in the adulthood stage. Leaders in this

phase are characterized by maturity, self-confidence, autonomy, solid decision-making,

and are generally more practical, multi-tasking, purposeful, self-directed, experienced, and

less open-minded and receptive to change. All these traits affect their motivation, as well

as their ability to learn and lead the barangay (Pappas, 2013).

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According to the BBC News article "How Aging Affects Your Ability," aging is most

likely to affect job performance if job tasks require sensory perception, selective attention,

working memory, information processing, rapid reaction or physical strength. People with

ages 55 years and above experiences such changes. With this, younger individuals tend to

be more productive that help them to come up with more creative solutions, and have more

fluid intelligence than older people. It looks as if when politics are keen to come up with

new ways of organizing themselves, they shift their preference to younger leaders (Vugt,

2014).

Another factor is the officials’ gender. According to Umali (2016), Philippine Politics is

a man’s world. As a conclusion, women are making strides, but also have a long way to go

before reaching equality with men in terms of leadership. One theory goes that society

generally associates successful leadership with stereotypically ‘masculine’ traits such as

assertiveness and dominance, and so disapproves of female leaders because they violate

these gender norms. As a result women experience greater obstacles to reaching the

upper echelons (Bailey, 2014).

Studies by the American University in 2011 survey indicate that “men are 60 percent

more likely than women to believe that they are “very qualified” to run for office.” This

research begs the question as to whether belief in qualification stems from ingrained

gender perceptions in comparison to ability. Researchers Kathryn Pearson from the

University of Minnesota and Eric McGhee from the Public Policy Institute of California

suggest that women are equally as qualified as men in political affairs, in most cases, even

more qualified than their male counterparts. Deficiency of political knowledge provides

correlation between the doubt women face and lack of political candidacy, which is in

contrast with the former study of American University. Accordingly, the lack of political
 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 21

knowledge stems from a lesser degree of consumption of politically based media,

concluding that the majority of news is “male-biased” (Gonzales, 2014).

Furthermore, it is believed that education, leadership, and development are

interrelated. Despite of its’ importance, aside from being able to read and write, the law

doesn’t prescribed specific educational attainment among elective barangay officials.

Dumlao (2016) cited in her study that college-educated leaders perform about the

same as or worse than those with less formal education. These leaders tend to perform

poorly in their works because it did not fit their educational qualification in the field of

barangay governance. Moreover, educational attainment has nothing to do with the level

of performance of barangay officials. She emphasized that barangay governance does

not need specialization and what’s important is the love for service to the people and basic

knowledge on administration.

To address lack in educational capacities of barangay officials, the government

provides seminars, training and workshops to guide barangay officials in the carrying out

of their barangay duties. The Department of Interior and Local Government (DILG)

conducts trainings for barangay officials to know their roles and responsibilities as they are

considered the “frontline” in terms of governance. According to a published article of

Borromeo (2011) stay-in trainings for barangay treasurers will be held for them to become

more effective in their jobs instead of replacing them with persons who have accounting

backgrounds.
 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 22

The Barangay Budget and Budget Process

In order for the barangay to perform its role efficiently, effectively and economically,

especially in the implementation of government programs, policies, plans, projects and

activities, the barangay must necessarily be provided with various fiscal as well as

administrative tools.

One of the basic instruments of local governance, in addition to this being a legal

requirement under the Local Government Code, is the budget. However, to ensure that the

budget fully supports local development thrusts and objectives, planning and programming

are first undertaken through the preparation and the adaptation of the Barangay

Development Plan and its accompanying work programs, especially those for the utilization

of the local development funds.

The budget is very important and significant document in government. It is the

culmination of the political process which the bureaucracy goes through in determining

how to implement the development plan for the country. It provides the framework within

which transactions should be recorded, classified, and summarized in the accounting

system (Institute Politics Governance, 2008). City budget officer, Atty. Leticia Clemente

stressed the significance of preparing a barangay budget since it serves as an instrument

for barangay officials to effectively manage the development of the barangays. According

to her, budgeting is the critical exercise of allocating revenues/income and borrowed funds

to accomplish and attain social, political and economic goals and provide for much needed

public services, thus, it is very important to prioritize their (barangays) projects to be

incorporated in the budget (Arranz, 2017).

According to DBM (2012), the significance of preparing a barangay budget is that

aside from being a financial plan, the barangay budget serves as an instrument for
 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 23

barangay officials to effectively manage the development of the barangay. A well-prepared

barangay budget serves as basis for planning and policy adoption, program and project

implementation, financial control, and management information.

Sections 329-334 (Barangay Budget) of the Local Government Code of 1991 (RA

No. 7160) provide the basis for the collection, safekeeping and use of barangay funds. The

aforesaid provisions govern the preparation, effectivity, and review of the barangay budget,

including the financial procedures that the barangay shall observe.

The four major phases in the formulation budget are preparation, authorization,

execution and accountability. The different phases overlap with each other within a budget

year. While the budget of a current year is being implemented, the barangay should also

prepare the budget for the succeeding year. Also within a budget year, the barangay

should prepare and submit accountability reports for the past and current year.

New Government Accounting System and its Provisions

Accounting is an effective tool of management in evaluating the performance of the

different agencies of government. The performance of the public managers would depend

on the most, on financial reports generated by the use of accounting systems.

Under Section 109, of the Presidential Decree (PD) no. 1445, defines Government

Accounting as one that encompasses the process of analyzing, classifying, summarizing

and communicating all transactions that are involved in the receipt and disbursement of all

government funds and properties, and interpreting the results thereof.

The objectives of Government Accounting includes producing relevant financial

information about past and present transactions of government; serving as a basis for

decision making for future operations; serving as the control mechanism for the receipt,
 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 24

disposition and utilization of government funds and properties; coming up with financial

reports pertaining to the results of operations of various government agencies that are for

dissemination to the public.

As stated by Miravite (2015), new accounting system needs to be developed that

would help the different agencies to hit on financial targets, and at the same time be

understood by all users of financial reports. With this new development, the Commission

on Audit (COA), under the new 1987 Constitution, promulgated the New Government

Accounting System in the Philippines (NGAs) for use by all government agencies.

The Commission on Audit (COA) replaced the 1992 Barangay Accounting Manual

with the new manual on “Systems and Procedures on the Management of Barangay Funds

and Property” through the issuance of COA Accounting Circular No. 2006-02 dated

December 19, 2006. This manual was developed to complete the implementation of the

New Government Accounting System (NGAS) in local government units.

According to the manual, financial transactions and operations of the barangays shall

be governed by the following fundamental principles:

1. No money shall be paid out of the local treasury except in pursuance of an

appropriations ordinance or law.

2. Local government funds and monies shall be spent solely for public purposes.

3. No public money or property shall be appropriated or applied for religious or private

purposes.

4. Disbursements or disposition of government funds or property shall invariably bear

the approval of the proper officials.

5. All claims against government funds shall be supported with complete

documentation.
 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 25

6. Local revenues/income shall be authorized by ordinance or law and collections

thereof shall always be properly acknowledged.

7. All monies officially received by a local government officer in any capacity or on any

occasion shall be accounted for as local funds, unless otherwise provided by law.

8. All collections shall be deposited intact with government depository bank for the

account of the barangay, except those collections to be remitted to the

City/Municipal (C/M) Treasurer.

9. Trust funds in the local treasury shall be paid out only for the purpose for which the

trust was created or the funds received.

10. Fiscal responsibility shall be shared by all those exercising authority over the

financial affairs, transactions, and operations of the barangays.

11. Local treasurers and other accountable officers shall keep personal monies

separate and distinct from local funds in their custody and shall not make profit out

of public money or otherwise make use of such fund for purposes not authorized by

law or ordinance.

12. Barangay accountable officers shall be duly designated and bonded.

The following general policies shall be observed in the accounting for barangay

funds and property:

1. For accounting purposes, the fiscal year for the barangay shall start on

January 1st and end on December 31st of each year.

2. A record to monitor and control approved appropriations and obligations shall

be maintained.

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

 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 26

4. The barangay financial transactions shall be recorded using the Chart of

Accounts prescribed by the Commission on Audit.

5. Barangay books of accounts shall consist of a Journal of Barangay

Transactions (JBT), General Journal (GJ), General Ledger (GL) and

Subsidiary Ledgers (SL) which shall be maintained by the barangay

bookkeeper under the direct supervision of the C/M Accountant.

6. Cash transactions shall be recorded in the JBT and non-cash transactions

shall be recorded in the GJ through a Journal Entry Voucher (JEV).

7. Records of Appropriations and Obligations (RAO) shall be used to record,

monitor and control appropriations and obligations charged thereto. A

Statement of Appropriations and Obligations (SAOB) shall be prepared to

report on the total appropriations and obligations as at a certain period.

8. A Cashbook shall be maintained and updated daily.

9. A modified accrual basis of accounting where income is recorded when

received and expenses recognized when incurred shall be adopted.

10. All collections of the barangay shall accrue to the General Fund unless

otherwise provided by law.

11. All lawful expenditures and obligations incurred during a fiscal year shall be

taken up in the accounts of that year.

12. Liabilities shall be recognized at the time goods and services are accepted or

rendered and supplier/creditor bills are received.

13. Property, plant and equipment (PPE) shall be recorded when actually

received.
 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 27

14. PPE used in barangay operation shall be subject to depreciation using the

straight line method after deducting a residual value equivalent to 10 per cent

of the cost of the property and equipment.

15. All borrowings and secured loans shall be recorded in the barangay books

using the appropriate liability accounts.

16. Petty Cash may be authorized by the Sangguniang Barangay (SB) in an

amount not to exceed twenty percent of the funds available and to the credit

of the barangay treasury or the maximum amount of the cash accountability

under the bond that shall be determined by the SB which shall not exceed ten

thousand pesos (P10,000.00), whichever is lower.

17. A monthly Bank Reconciliation Statement shall be prepared by the C/M

Accountant upon receipt of the bank statement.

18. Supplies and materials including drugs and medicines shall be recorded using

the expense method. The value of the inventory shall be recorded at yearend

based on the physical inventory report. At the start of the year, the journal

entry made at the end of the previous year shall be reverted.

19. Grants and donations in kind shall be recorded at appraised value in the

absence of any cost at the time of receipt and shall be recorded to the

appropriate asset accounts and subject to depreciation as provided in Item

1.2.13. Donations in kind shall be covered by a Sanggunian Resolution

accepting the donation and a Deed of Donation.

20. The property and equipment used in the barangay operation shall be subject

to depreciation using the straight line method after deducting a residual value

equivalent to 10 per cent of the cost of the property and equipment.

 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 28

Section 367 of the National Internal Revenue Code of 1939 states that

apportionment of national internal revenue under the provision of this Title shall be

based on population as shown by the latest official census.

The budget of the barangay shall be approved by the Sangguniang Barangay (SB)

and shall be known as barangay appropriation ordinance which shall serve as the

authorization for the barangay to incur expenditures and obligations. The Chairman of the

Committee on Appropriations (CCA) shall be responsible for the proper monitoring and

control of the barangay budget. Hereunder are the specific policies and procedures related

to barangay appropriations and obligations:

1. The approved barangay appropriation ordinance shall be recorded in the RAO

that shall be maintained by the Chairman of the Committee on Appropriations

(CCA).

2. The RAO shall show the annual and supplemental appropriations and the

obligations charged against the said appropriations. It is used to monitor the

availability of appropriations to cover expenditures/obligations to be incurred.

3. Expenditures/Obligations shall in no case exceed available appropriations.

4. Charges against the appropriations shall be based on the obligations made as

shown in the Disbursement Voucher (DV), Payrolls, Contracts or Purchase

Orders.

5. Based on the RAO, the CCA shall certify as to the existence of appropriation on

the DV, Payrolls, Contracts or Purchase Orders. As such, the CCA shall

regularly update the RAOs by posting all obligations to determine available

balance of the appropriations and to serve as his basis in certifying the DVs and

other related documents.

 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 29

6. The CCA shall report the charges to and balances of appropriations to the

Punong Barangay (PB) and the SB monthly through the SAOB. It shall be

certified correct by the CCA and duly noted by the PB and SB.

7. The PB and SB shall use the SAOB in the evaluation of the barangay status of

finances.

The Barangay Treasurer (BT) shall be responsible for the proper handling of the

funds of the barangay. For this purpose, he shall observe the following specific policies

and procedures pursuant to existing laws, rules and regulations:

1. All collections, either in cash or in checks, shall be acknowledged through the

issuance of an Official Receipt (OR).

2. Only checks in the name of the barangay shall be accepted as payment of

obligation to the barangay and issued the corresponding OR.

3. The OR shall be subject to proper custody, accountability and audit.

4. Collections shall not be used to encash checks or pay barangay

obligations/liabilities.

5. Collections accruing to the barangay shall be deposited intact daily. Where travel

time to the depository bank is more than one day, deposit shall be made at least

once a week or as soon as the collections reach P5,000.00.

6. Collections received by the BT as deputized collector of the city/municipality shall

be remitted intact to the treasurer of the city/municipality concerned at least once

a week or as practicable especially during heavy collections.

7. The barangay shall maintain only one depository account with Authorized

Government Depository Bank (AGDB) in the name of the barangay.

 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 30

8. Collections and deposits shall be recorded in the Cashbook maintained by the BT

based on the Report of Collections and Deposits (RCD).

9. The BT shall submit the RCD with the duplicate copies of the OR and validated

deposit slip to the C/M Accountant within five days after the end of the month.

10. Upon receipt of the Bank Statement, the C/M Accountant shall prepare a monthly

Bank.

11. Requisitions and issuances of accountable forms shall be reported in the month.

12. Report of Accountability for Accountable Forms (RAAF).

The Barangay Treasurer (BT) shall also observe the following specific policies and

procedures on disbursements of the barangay funds pursuant to existing laws, rules and

regulations:

1. Disbursements shall generally be made by checks drawn against the depository

accounts of the barangay.

2. Disbursements shall be made only on duly certified and approved Disbursement

Voucher (DV) and Petty Cash Voucher (PCV) and Payroll.

3. The BT shall certify the DV as to the availability of funds for the purpose and as

to the completeness and propriety of the supporting documents.

4. The PB shall certify as to the validity, propriety, and legality of the transaction and

shall approve for payment the DV or payroll.

5. Disbursements in cash shall be made only from the cash advances granted for

the purpose (e.g. to pay salaries and wages, honorarium, etc.) and petty cash.

6. The cash advance for payroll shall be equal to the net amount of the payroll for a

pay period.
 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 31

7. The cash advance shall be used solely for the specific purpose it was drawn and

shall not be used for encashment of checks or for liquidation of previous cash

advances or other purposes.

8. The cash advance for payroll shall be liquidated within 5 days after the end of the

pay period. Any unexpended cash and unreleased salaries/allowances shall be

submitted together with appropriate supporting documents shall be returned to

the BT and an OR shall be issued.

9. Liquidation shall be done within 30 days for local travel and 60 days for foreign

travel, upon return to the official station. Liquidation documents shall include

certificate of travel completed, certificate of appearance, used tickets, official

receipts, etc.

10. Cash advances can be granted for special purpose/time-bound undertaking such

as conduct of barangay general assembly, public hearing, calamity, etc. These

cash advances shall be liquidated upon accomplishment of the purpose for which

these were granted.

11. Liquidation documents shall be summarized in a Liquidation Report (LR) and it

shall be supported with disbursement documents such as: authority for the

purpose, list of participants or attendees, official receipts, etc.

12. Any unexpended balance of cash advances shall be returned and an OR shall be

issued by the BT.

13. The BT/Petty Cash Custodian (PCC) may be authorized by the SB to hold a petty

cash in the maximum amount of P10,000.00 which shall be maintained under the

imprest system and shall be replenished when the total expenses amounts to at

least seventy five per cent or as needed.

 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 32

14. The BT/PCC may be authorized to make direct purchases amounting to not more

than one thousand pesos (P 1,000.00) at any time for the ordinary and essential

needs of the barangay.

15. The petty cash shall be kept separately from the regular collections and

advances granted for a particular purpose.

Management and accounting for the procurement, issuance and utilization/location of

supplies and materials; and property, plant and equipment is necessary for the proper

documentation, monitoring and control. The BT shall act as the Supplies and Property

Officer of the barangay and shall be responsible for the receipt, upkeep, issuance and

physical inventory of barangay property.

1. Procurement/Acquisition of supplies and materials shall be directly charged to

MOOE and shall be recorded using the appropriate expense accounts.

2. Except for emergency cases, all procurement shall be covered by an Approved

Procurement Program (APP).

3. Issuance of supplies shall be supported by an approved Requisition and Issue

Slip (RIS) .

4. For proper accountability, the supplies with serviceable life of more than one

year shall be covered by an Inventory Custodian Slip (ICS).

5. The ICS for supplies with more than 1 year life span shall be automatically

cancelled upon expiration of the estimated useful life.

6. Stock Card (SC) shall be maintained to monitor and control procurement and

issuance of supplies and materials.

 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 33

7. Requisition and purchase of supplies and materials shall be covered or

supported by an approved Purchase Request (PR) and Purchase Order

(PO).

8. Procurement of PPE shall be charged against appropriations for Capital Outlay

and included in the APP.

9. Issuances of property and equipment to the end users shall be acknowledged

by the Property Acknowledgement Receipt (PAR) which shall be renewed at

least every three years or whenever there is a change in custodianship.

10. Property/Equipment Card (PEC) shall be maintained for all property and

equipment of the barangay.

11. Requisition of PPE shall be supported with an approved PR.

12. Purchases shall be covered by PO/Contract.

13. All deliveries shall be covered by Acceptance and Inspection Report (AIR).

14. All costs incurred during the construction of infrastructure assets shall form part

of the cost of the project.

15. Repairs and maintenance shall be charged to appropriate repairs and

maintenance expense account of the specific assets.

16. The barangay shall conduct an annual physical inventory of all supplies,

property and equipment of the barangay.

17. The PAR shall be renewed annually.

18. Report on the results of physical inventory of property/equipment shall be

reconciled with the accounting records.

 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 34

19. Property and equipment which have become unserviceable or no longer

needed shall be disposed or sold, whenever applicable at public auction,

subject to applicable rules and regulations.

With the implementation of New Government Accounting Manual, a need to enhance

accountability and transparency must be founded. Also, officials of the Barangay must be

equipped with the necessary competencies in order to fulfill their mandates and functions.

Legaspi (2002) said that in relating directly with the community, the local government

personnel must have the necessary skills and knowledge to better serve the residents

needs and concerns.

The Enactment of Government Accounting in Local Agencies of Foreign Countries

Various governmental accounting systems are used by various public sector entities.

International Public Sector Accounting Standards (IPSAS) are a set of accounting

standards issued by the IPSAS. Board for use by public sector entities around the world in

the preparation of financial statements. These standards are based on International

Financial Reporting Standards (IFRS) issued by the International Accounting Standards

Board (IASB).

Many governments say they are introducing IPSAS because it is considered to be

good practice. However, very few governments have actually adopted the standards. In

terms of the Cash Basis IPSAS not a single country in the world has actually adopted the

standard. The main problem is the key requirement to produce consolidated financial

statements for all controlled entities. Consolidating government business entities with

ministries and departments would be very time consuming and almost all governments

consider that it is not worth the very real costs.

 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 35

To name a few, Afghanistan is in the process to adopt IPSAS, first cash basis then

accrual basis. Abu Dhabi has already been able to prepare 2010 financial statements in

accordance with accrual accounting IPSAS for some departments and municipalities.

Argentina is in the process in place to develop public sector accounting standards that are

harmonized with accrual accounting IPSAS. Australia  already adopted full accrual

accounting standards, consistent with IPSAS. Canada applies accounting standards that

are broadly consistent with IPSAS. Cayman Islands Government has adopted accrual

basis IPSAS. China has project in place to adopt IPSAS. But there is no formally

announced decision. India’s Government Accounting Standards Advisory Board is in favor

of limited adoption of cash basis IPSAS for cash transactions and corresponding accrual

IPSASs for those transactions recorded on other than the cash basis. A road map has

been prepared for transition from the cash to accrual accounting system and an

operational framework for its implementation. Netherlands Government has experimented

adoption of accrual basis IPSAS. Nicaragua adopted cash basis IPSAS. Nigeria is in the

process of adopting the cash basis IPSAS, will then move to adopt accrual basis IPSAS.

This is to conform to international accounting standards. Russia has adopted the accrual

accounting IPSAS and has made significant progress towards implementation.

Singapore has adopted full accrual accounting standards, consistent with IPSAS. Spain’s

Spanish Ministry of Economy and Finance is implementing accrual basis IPSAS for public

sector financial reporting. The Ministry plans to have implemented accrual basis IPSAS by

2011 at the latest. United Arab Emirates is in the process in place to adopt accrual basis

IPSAS as well as Vietnam, Yemen and many more.

In the United States, however, there are two levels of government which follow

different accounting standards set forth by independent, private sector boards. At the
 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 36

federal level, the Federal Accounting Standards Advisory Board (FASAB) sets forth the

accounting standards to follow. Similarly, there is the Governmental Accounting Standards

Board (GASB) for state and local level government.

Established in 1984, the GASB is the independent, private-sector organization based

in Norwalk, Connecticut, that establishes accounting and financial reporting standards for

U.S. state and local governments that follow Generally Accepted Accounting Principles

(GAAP). These standards are recognized as authoritative by state and local governments,

state Boards of Accountancy, and the American Institute of CPAs (AICPA). The GASB

develops and issues accounting standards through a transparent and inclusive process

intended to promote financial reporting that provides useful information to taxpayers, public

officials, investors, and others who use financial reports.

The Governmental Accounting Standards Board Statements (GASB Statements in

short) are issued by GASB to set generally accepted accounting principles (GAAP) for

state and local governments in the United States of America. These statements are the

most authoritative source for governmental GAAP. Other business entities follow

statements issued by Financial Accounting Standards Board (FASB).

The Governmental Accounting Standards Board (2009) issued the “GAAP hierarchy”

in Statement 55 of Governmental Accounting Standards Board. It is consisting of the

sources of accounting principles used in the preparation of financial statements of state

and local governmental entities that are presented in conformity with GAAP, and the

framework for selecting those principles. The GAAP hierarchy identifies the sources of

guidance that state and local governments follow when preparing financial statements in

conformity with GAAP and lists the order of priority for pronouncements to which a

government should look for guidance.

 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 37

In June 29, 2015, GASB issued a final Statement that simplifies the structure of the

hierarchy of Generally Accepted Accounting Principles (GAAP)—or “GAAP hierarchy.”

GASB Statement No. 76, The Hierarchy of Generally Accepted Accounting Principles for

State and Local Governments, reduces the GAAP hierarchy to two categories of

authoritative GAAP from the four categories under GASB Statement No. 55, The Hierarchy

of Generally Accepted Accounting Principles for State and Local Governments. The first

category of authoritative GAAP consists of GASB Statements of Governmental Accounting

Standards. The second category comprises GASB Technical Bulletins and Implementation

Guides, as well as guidance from the American Institute of Certified Public Accountants

that is cleared by the GASB.

The Statement also addresses the use of authoritative and nonauthoritative literature

in the event that the accounting treatment for a transaction or other event is not specified

within a source of authoritative GAAP. These changes are intended to improve financial

reporting for governments by establishing a framework for the evaluation of accounting

guidance that will result in governments applying that guidance with less variation. That will

improve the usefulness of financial statement information for making decisions and

assessing accountability and enhance the comparability of financial statement information

among governments.

Financial Management in the Private and Public Sector: A Comprehensible

Comparison

Deepika & Maya Rani (2014) defined Financial Management as an activity of

management which is concerned with the planning, procuring, and controlling of the firm’s

financial resources. Financial management plays a critical role in the financial success of a
 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 38

business. Therefore, an organization should consider financial management a key

component of the general management of the organization (Bass, 2017). According to

Johnston (2017), financial management in businesses is important because it affect all

aspects and decisions relating to capital expenditures, operating cash, lowering expenses

and tax planning.

On the other hand, the aim of financial management in the public sector is to

manage limited resources to ensure economy and efficiency in the delivery of outputs

required to achieve desirable outcomes that will serve the needs of the community.

Overall, financial management practice in the public sector and in the private sector

differs significantly. The private sector has an advantage in having clearer performance

drivers (for example, the profit motive) and a much better understanding of the practice of

performance management (Controller and Auditor-General New Zealand, 2012). In the

government environment, public sector entities have different goals, as opposed to the

private sector entities' one main goal of gaining profit. Also, in government accounting, the

entity has the responsibility of fiscal accountability which is demonstration of compliance in

the use of resources in a budgetary context. In the private sector, the budget is a tool in

financial planning and it isn't mandatory to comply with it.

Lewis (2017) said that accounting methods used in both private and public sector

financial management differ significantly. For instance, in the private sector, financial

managers and accountants are bound Generally Accepted Accounting Principles or GAAP,

methodology for accounting. This is a set of practices, such as the double entry accounting

method, used to ensure financial accuracy and uniformity. In the public sector, this method

may also be used but it is not that unusual to deviate from them, as well. This is seen in
 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 39

areas such as budgeting where public sector financial managers are not necessarily bound

by accrual accounting methods.

In the "Journal of Management Studies," George A. Boyne points out the fact that

many theorists hold that the differences are so great that use of private sector

management in the public sector should be avoided.

Financial Management in the Barangays and its Importance

Public financial management basically deals with all aspects of resource mobilization

and expenditure management in government (Lewis, 2017). Public Financial Management

(PFM) is usually seen as the complex of activities related to budget preparation and

execution, control, accounting, reporting, monitoring and evaluation (Allen et al. 2004). A

sound public financial management system allows governments to make best use of its

resources to improve quality of life in the society. Strong and effective PFM is a vital

component for good governance. Its strategy underpins fiscal and macro stability, guide

the allocation of public resources to national priorities, support the efficient delivery of

services for poverty reduction and economic development, and make possible the

transparency and scrutiny of public funds.

According to Organization for Economic Co-operation and Development (2017)

strong public financial management systems are essential for the effective and sustainable

economic management and public service delivery period. Government bodies are

effective and accountable when they are underpinned by good public financial

management institutions and systems. Good public financial management systems are

also indispensable in insuring that aid is being used to achieve development goals.
 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 40

Norad (2015) stated that good public financial management systems are important

for democratic governance, macro-economic stability, effective use of resources available

and poverty reduction. Good public financial management systems can also prevent

corruption and foster effectiveness. A sound public financial management system is a

precondition for making it possible to effectively channel resources to service delivery like

e.g. basic education and health services. Ineffective public financial management systems,

on the other hand, can hamper development and increase the risk of corruption.

In the area of barangay, barangay officials and employees concerned, whether

educationally qualified or not, truly engaged most of the time, in financial planning and

control practices, cash management practices, and financial reporting.

According to NGAS, in connection with the management of the barangay funds and

property, the duties and responsibilities of the barangay officials are as follows:

Punong Barangay

a. Implements function, project contracts and activities to provide basic

services and facilities to the barangay as appropriated;

b. In coordination with the barangay development council, prepare the annual

executive and supplemental budgets of the barangay;

c. Negotiates, enters into and signs contracts for and in behalf of the

barangay upon authorization of the SB;

d. Certifies DVs and payrolls as to validity, propriety and legality of the claim;

e. Approves claims relating to the disbursements of barangay funds;

f. Countersigns checks in payment of the claims;

g. Signs the Statement of Management Responsibility over the Financial

Statements; and
 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 41

h. Ensures that all accounting documents and records are properly kept by

concerned barangay officials and staff.

i. Inform the COA Auditor’s Office of the resignation, retirement, suspension

of the barangay officials including change of barangay treasurer so that the

latter could be subjected to audit.

Chairman, Committee on Appropriations

a. Certifies the DV/payroll, contract/PO on the existence of available

appropriations to cover the claim;

b. Monitor the utilization of appropriations with the use of the appropriate RAO;

c. Maintains the RAO;

d. Ensures that commitments/charges to the approved appropriations do not

exceed the available appropriations; and

e. Certifies the RAO and submits the SAOB at month end and year end to the

M/C Budget Officer for consolidation and eventual submission to the COA

Auditor.

Barangay Treasurer

Collections

a. Keeps custody of barangay funds and property and ensure the safety of

cash, cash items and barangay records;

b. Collects all taxes, fees and other charges due and contributions accruing to

the barangay and deposit the same with authorized depository bank;

c. Collects for the C/M Treasurer when deputized and remits all collections

intact;

d. Renders report on collections and deposit made.

 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 42

Disbursements

e. Certifies to the availability of cash for the DV/Payroll presented;

f. Issues and signs checks for payment of obligations;

g. Renders the report on checks, cash and PCF disbursements;

h. Maintains the Cashbook to record in and out of cash in the treasury, in

depository banks and petty cash fund;

Supplies and Materials and Property

i. Keeps the records of supplies and materials and property of the barangay;

j. Prepares and maintains the ICS for the issuance of small items with

serviceable life of more than one year and PAR for the issuance of property

and equipment to end-users; and

k. Assists the PB in the conduct of physical count of property.

Loa (2008), mentioned that the barangay officials are perceived to be more effective

in the area of Barangay Accounting, as this is probably due to the monthly meetings

conducted by officials from the City Accounting Office. She mentioned in her unpublished

master’s thesis that the barangay officials are much effective in managing the barangay

funds as compared to other areas of concern, as they can comply with the existing

accounting and auditing rules and regulations.  

The purpose of her study was to ascertain the Financial Management Practices as

Perceived by the Barangay Officials in Iligan City, along the five areas of concern namely:

Taxation and Revenue Generation, Barangay Budgeting, Barangay Accounting,

Procurement of Supplies and Materials, and Disbursement of Barangay Funds. The

sources of data for this study were three key barangay officials, the Punong Barangay,

Barangay Treasurer, and a Sangguniang Barangay Member of each barangay in Iligan

 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 43

City. There were one hundred thirty two (132) respondents. It turns out in this study that

there is no significant difference between the perceptions of the barangay officials on the

five Financial Management Practices in the 44 barangays in Iligan City.

According to Joza (2017), in the study of the level of knowledge on treasury

operations of barangay treasurers in Bayombong, Nueva Vizcaya, the barangay treasurers

are knowledgeable to very high extent in terms of receipts and disbursements of funds.

Furthermore, the number of years in service and educational attainment do not influence

the barangay treasurers’ knowledge on receipts and disbursements but on the contrary,

the number of seminars attended and civil service eligibility are factors that influence their

knowledge on receipts and disbursements of funds.

In 2011-2012, the COA has found 27 common deficiencies in the operations of 80

Cebu City barangays according to Felicitas. During the forum organized by the Association

of Barangay Councils (ABC), COA Cebu City State Auditor said that the most common

lapse by the barangays involved unliquidated cash advances. As stated in COA Circular

2012-004, the cash advances must be liquidated immediately and those who fail to do so

may be charged for violating the Revised Penal Code because non-liquidation serves as

evidence that a person misused public funds. The state auditor also observed that some

bidding of various barangay projects lacked supporting documents. As specified in

Republic Act (RA) 9184 or the Government Procurement Reform Act, bidding documents

should include among others the approved budget contract, terms of reference, plans and

technical specifications of the projects, bid form, eligibility requirements, bid security form,

contract form and other necessary supporting documents. Other common deficiencies that

COA noted were the specification of the brand in buying items, failure of the barangay to

use the Government Electronic Procurement System in the procurement of supplies,

 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 44

materials and equipment, failure of the barangay to provide warranty security for the

procurement of goods and delayed submission of their financial statements. The state

auditor urged barangay officials to become familiar with the provisions of RA 9184 and

COA rules and regulations (Suns Star-Cebu News, 2014).

Eleven barangays of Cebu City have failed to conduct a physical inventory of their

respective properties, equipment and assets. State Audit Eva Cabrera, in an interview with

The FREEMAN, said the 11 barangays have been furnished a copy of the report. The

audit, which ended last December 31, 2009, covered a two-year period from 2008 to 2009.

In the report, the state auditors said they could not determine what properties,

equipment and assets the barangays had because of inadequate accounting of records.

According to the report, the barangay failed to conduct physical count on their assets and

equipment hence, physical inventory reports were not submitted to the office of the auditor

(Philstar, 2011).

Based on a study conducted by Torres (2008), suffice it to say that financial stability

is critical to development. No matter how forward looking the locality is, it cannot

implement plans if it has insufficient funds and officials are not thoroughly familiar with the

financial policies and procedures. The author further added that based on his observation,

some of government offices cope up with work in the last minute for requirement purposes.

Other also ignore directives while the rest comply with procedures but end up getting

delayed or stuck for lack of supporting documents, and the like. There is, therefore, no

guarantee of compliance despite of rules and guidelines for implementation.

Synthesis of the Related Literature and Studies

 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 45

The review of related literature and studies serve as a guide to thoroughly

understand the conduct of the present study.

Barangay, as defined by Miriam-Webster dictionary, is a unit of administration in

Philippine society consisting of from 50 to 100 families under a headman. According

to Section 384 of Republic Act No. 7160, otherwise known as the Local Government Code

of 1991, it is a basic political unit that serves as the primary planning and implementing unit

of the government policies, plans, programs, projects and activities, in the community and

as a forum wherein the collective views of the people may be expressed, crystallized and

considered, and where disputes may be amicably settled. In addition it is defined by the

Institute Politics Governance (2008), as the smallest and lowest political unit in the whole of

the bureaucracy of government.

Rep. Edcel C. Lagman mentioned in his speech at the 2007 Oath Taking

Ceremonies of Barangay Officials of the First Congressional District of Albay barangay,

stated that if we are to progress as a nation, it is necessary that the foundation of our

government be firm lest the whole structure crumbles. This shows that the barangay is

indeed the smallest yet the greatest political unit. He also claimed that the barangay is the

principal link of the people to the municipal, provincial, and national government.

Furthermore, Comelec Commissioner Luie Guia said the barangay is “where you can feel

your government directly and how government affects your life.” Being the smallest unit of

the society, the barangay serves as the link to communities and is the first to respond in

times of calamities while the barangay chairman (village chief) serves as the “mayor” of the

community. (Cave, 2013). According to Tamayo (2014), certainly, barangays play a

significant role in the national pursuit of economic progress and in improving our nation’s
 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 46

political and social conditions. The holding of barangay assemblies is imperative as a way

of helping the national government attain its goals.

Apart from leader behavior, which has been found to be an important determinant for

leadership effectiveness in the literature, age is considered to be another important

determinant. Drawing upon the early trait theories a leaders’ chronological age is one of

the most important demographic factors in relation to effectiveness. According to

Boerrighter (2015) older leaders are not better or worse than younger leaders in achieving

effective leadership. This is supported by a journal, the Leadership Quarterly, noting that

people preferred the younger looking leader for change and the older looking leader for

stability. Pappas (2013) mentioned that ages between 26 and 55 years are said to be in

the adulthood stage. Leaders in this phase are characterized by maturity, self-confidence,

autonomy, solid decision-making, and are generally more practical, multi-tasking,

purposeful, self-directed, experienced, and less open-minded and receptive to change. All

these traits affect their motivation, as well as their ability to learn and lead the barangay. In

addition, according to the BBC News article "How Aging Affects Your Ability," aging is most

likely to affect job performance if job tasks require sensory perception, selective attention,

working memory, information processing, rapid reaction or physical strength. People with

ages 55 years and above experiences such changes. With this, younger individuals tend to

be more productive that help them to come up with more creative solutions, and have more

fluid intelligence than older people. It looks as if when politics are keen to come up with

new ways of organizing themselves, they shift their preference to younger leaders (Vugt,

2014).

According to Umali (2016), Philippine Politics is a man’s world. As a conclusion,

women are making strides, but also have a long way to go before reaching equality with
 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 47

men in terms of leadership. One theory goes that society generally associates successful

leadership with stereotypically ‘masculine’ traits such as assertiveness and dominance,

and so disapproves of female leaders because they violate these gender norms. As a

result women experience greater obstacles to reaching the upper echelons (Bailey, 2014).

Studies by the American University in 2011 survey indicate that “men are 60 percent more

likely than women to believe that they are “very qualified” to run for office.” This research

begs the question as to whether belief in qualification stems from ingrained gender

perceptions in comparison to ability. Researchers Kathryn Pearson from the University of

Minnesota and Eric McGhee from the Public Policy Institute of California suggest that

women are equally as qualified as men in political affairs, in most cases, even more

qualified than their male counterparts. Deficiency of political knowledge provides

correlation between the doubt women face and lack of political candidacy. The lack of

political knowledge stems from a lesser degree of consumption of politically based media,

concluding that the majority of news is “male-biased” (Gonzales, 2014).

Dumlao (2016) cited in her study that college-educated leaders perform about the

same as or worse than those with less formal education. These leaders tend to perform

poorly in their works because it did not fit their educational qualification in the field of

barangay governance. Moreover, educational attainment has nothing to do with the level

of performance of barangay officials. She emphasized that barangay governance does

not need specialization and what’s important is the love for service to the people and basic

knowledge on administration. According to a published article of Borromeo (2011) stay-in

trainings for government officials will be held for them to become more effective in their

jobs instead of replacing them with persons who have college degree.
 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 48

One of the basic instruments of local governance, in addition to this being a legal

requirement under the Local Government Code, is the budget. The budget is very

important and significant document in government. It is the culmination of the political

process which the bureaucracy goes through in determining how to implement the

development plan for the country. It provides the framework within which transactions

should be recorded, classified, and summarized in the accounting system (Institute Politics

Governance, 2008). City budget officer, Atty. Leticia Clemente stressed the significance of

preparing a barangay budget since it serves as an instrument for barangay officials to

effectively manage the development of the barangays. She said that government

budgeting is the critical exercise of allocating revenues/income and borrowed funds to

accomplish and attain social, political and economic goals and provide for much needed

public services, thus, it is very important to prioritize their (barangays) projects to be

incorporated in the budget (Arranz, 2017).

From the related literature and studies that the researchers gathered both from local

and foreign sources, these showed how important sound financial management is,

whether for the private sector or the public sector. According to Organization for Economic

Co-operation and Development (2017), strong public financial management systems are

essential for the effective and sustainable economic management and public service

delivery period. This is supported by Norad (2015) which stated that good public financial

management systems are important for democratic governance, macro-economic stability,

effective use of resources available and poverty reduction.

In relation to financial management, a new accounting system needs to be

developed to help different agencies to hit on financial targets, and at the same time be
 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 49

understood by all users of financial reports. The Commission on Audit (COA) under the

new 1987 Constitution, promulgated the New Government Accounting System in the

Philippines (NGAs) to be used by all government agencies especially the barangay to have

uniform guidelines and procedures in accounting for barangay funds and property and to

prescribe the accounting records to be maintained and the financial statements to be

generated.

Essentially, barangay as the closest level of government that serves the people, is

subject to strict compliance to the implementation of the New Government Accounting

System (NGAS) to ensure that they achieve correct management and use of funds and

properties entrusted to them to serve the public. In addition, covered by the said manual

are the responsibilities shared by the barangay officials having authority over the financial

transactions of the barangay, namely the barangay chairman, barangay treasurer and the

chairman of the committee on appropriations. Barangay officials and employees

concerned, whether educationally qualified or not, truly engaged most of the time, in

financial planning and control practices, cash management practices, and financial

reporting.

With regards to the related studies, Loa (2008) mentioned in her unpublished

master’s thesis that the barangay officials are much effective in managing the barangay

funds as compared to other areas of concern, as they can comply with the existing

accounting and auditing rules and regulations.  This is also supported by the study of Joza

(2017) wherein it comes up with the conclusion that the barangay treasurers are

knowledgeable to very high extent in terms of receipts and disbursements of funds. On the

other hand, In 2011-2012, the COA has found 27 common deficiencies in the operations of

80 Cebu City barangays according to Felicitas. COA Cebu City State Auditor said that the
 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 50

most common lapse by the barangays involved unliquidated cash advances. The state

auditor also observed that some bidding of various barangay projects lacked supporting

documents. According to Torres (2008), financial stability is critical to development. No

matter how forward looking the locality is, it cannot implement plans if it has insufficient

funds and officials are not thoroughly familiar with the financial policies and procedures.

There is, therefore, no guarantee of compliance despite of rules and guidelines for

implementation.
 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 51

Chapter 3

RESEARCH METHODOLOGY

This chapter presents the method and procedures used by the researchers to

gather and treat data.

Methods of Research

This study made use of the descriptive research method which is designed for the

researchers to gather information about present existing conditions needed in the chosen

field of study. This method enables the researchers to interpret the theoretical meaning of

findings and hypothesis development for further studies.

Descriptive research method describes the nature of activation as it exists at the time

of the study and to explore the causes of particulars phenomena and involving collections

of data in order to test by hypotheses or to answer questions concerning the current status

of the subject of the study (Estolas and Macaballug, p.81).

Descriptive method encompasses all the data gathered useful in adjusting or

meeting the existing phenomenon. The survey study was employed to measure the

existing event without inquiring into why it exists. In this study, this method involved

determined information about variables rather than the individuals.

As used in this research, gathered and treated are data on profile of the barangays’

respondents in terms of age, sex, number of employees and number of years in the public

service, the compliance of the respondents in the organization’s financial management

practices in terms of budget appropriation, collections and deposits/remittances,

 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 52

disbursements, reporting and monitoring, the significant difference in the level of

implementation of financial management practices of barangays in Sta. Mesa in

accordance to New Government Accounting System (NGAS). Then they are grouped

according to their profile, the problems encountered by the respondents’ compliance on

the financial management practices of the barangays and the significant difference on the

problems that the respondents encountered about the compliance of financial

management practices of barangays in Sta. Mesa, Manila when they are grouped

according to their profile.

Population, Sample Size, and Sampling Techniques

The population of the study were the officials of the 50 barangays in Sta. Mesa,

Manila consisting of the punong barangay, the treasurer, and the chairman of

appropriations and was obtained through inquiry to the Manila City Hall for the list thereof.

For the 50 barangays from the list, 110 respondents were taken. The study started on July

2017 and was completed by October 2017.

Description of Respondents

The respondents of the study were the officials responsible for the implementation of

financial management practices of their barangay in accordance to National Government

Accounting Manual. They are the Barangay chairman, the treasurer and the chairman for

appropriations officer who will then be asked to provide necessary information using the

questionnaires distributed by the researchers. The data gathered from the respondents will

give the researchers necessary information regarding the research topic.

 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 53

Research Instrument

In the study, the instruments used are questionnaires, which are a necessity for

descriptive method. The contents of the questionnaire were adopted from the New

Government Accounting System (NGAS). The researchers have adopted the subjects of

their study as basis for developing their questionnaire. The researchers were grouped

individually to have the proper division of their part in the questionnaire. By all means, the

researchers designed the questionnaires in proper form to accommodate sufficient and

relevant information required from the respondents. The questionnaire is divided into three

(3) parts. The first part is about the profile of the respondents which includes their name,

age sex educational attainment, position and experience. The first part also includes

profile of the barangay where the respondent is residing, it comprises the barangay

number, the annual barangay budget and the number of residents. On the other hand, the

second part consists of the level of implementation of financial management practices of

barangays in Sta. Mesa in accordance to NGAS. The second part is further subdivided

into six (6) parts: Fundamental principles, Appropriations and obligations, collections and

deposits/remittances of the barangay, disbursements, supplies and materials, and

property, plant and equipment. Lastly, the third part of the questionnaire consists of the

problems encountered by the respondents based on their work experience. After the

researchers gathered the data, it will then be analyzed using statistical measures.

Pre-testing was administered to ten (10) barangays in San Juan, Manila to determine

the validity and reliability of the instruments. The respondents were the punong barangay,

the treasurer, and the chairman of appropriations. They were requested to rate themselves

in terms of their financial management practices. They were taken as subjects for the pre-

testing because they did not comprise the official respondents of this study
 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 54

Further, after gathering the results of the pre-test, internal consistency was used to

determine its reliability. From this, a reliability coefficient of was computed which can be

concluded From the calculations made, questions contained in the questionnaires were

valid and reliable. Hence, questions were properly prepared and officially floated to the

respondents.

Data Gathering Procedure

To gather data, this study used the descriptive method. It is descriptive in a sense

that it sought to find answers to questions through the analysis of variable relationships. It

involved hypothesis formulation and testing (Best and Kahn, 1998).

The instruments used are questionnaires, which are a necessity for descriptive

method. The contents of the questionnaire were adopted from the New Government

Accounting System (NGAS). The researchers have adopted the subjects of their study as

basis for developing their questionnaire. Once questionnaires were formulated, these were

refined and corrected, and then finally administered to the respondents.

The permission from the Chairman of the Association of the Barangay Captains was

sought through the notation of the adviser. With the approval of the Chairman, the

respondents were given the questionnaires. The questionnaires were personally

distributed by the researchers, to the different barangay officials and employees involved

in this study. The researchers also retrieved the same from the respondents. Anonymity

was assured by not requiring the respondents to write their names. Answers in the

questionnaires were treated with utmost confidentiality. However, there were respondents

who were willing to have their names cited as output of the interviews conducted.
 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 55

The result will be tallied and tabulated according to the frequency of the items

checked by the participants. After data tabulation, data will be interpreted using various

statistical tools. The results of the technique used in the data gathering helped the

research team to arrive at the interpretation of the study.

Statistical treatment of data

The data collected in this study were organized and classified based on the research

design and the problems formulated the data were coded, tallied and tabulated to facilitate

the presentation and interpretation of results using the following:

1. Frequency Counts and Percentage Distributions

These techniques were used to come up with the profile of the barangay

officials/employees in terms of number of years of schooling, number of relevant training

and seminar workshops attended, and length of experience. The same tools were used to

come up with the profile of the barangay in terms of population, annual income, sources of

income, and expenditures.

The formula is:

where:

F = frequency; and

N = number of respondents

2. Analysis of Variance (ANOVA)

It is also called the F-Test. ANOVA is a statistical test which analyzes variance. This

was used because there is only one factor being studied as independent variable. The
 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 56

analysis of variance (ANOVA) is a method for dividing the variation observed into different

parts, each part assignable to a known source, cause or factor. Simply stated, it is helpful

in making comparison of two or more means which enables to draw various results and

predictions about two or more sets of data.

The following formula was used for the F-test Ratio:

Sum of Squares

SSt = ∑X2t - (∑Xt)2n

Where:

SSt = total sum of squares

∑X2t = total sum of x2

(∑Xt)2 = square of total sum of x

n = total number of respondents

Sum of Square between:

Where:

SSb = sum of square between

∑X1… = summation of x

n = total number of respondents

Sum of square within:

SSw= SSt − SSb

Where:

SSw = sum of square within

SSt = sum of square total

 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 57

SSb = sum of square between

Degree of freedom:

dfb= k-1

dfw= nt – k

Mean Square:

` MSb =

Where:

MSb = means square between

SSb = sum of square between

dfb = degrees of freedom between

MSw

MSw = mean square within

SSw = sum of square within

dfw = degrees of freedom within

F-ratio:

F=

Where:

F = F-test ratio

MSb = mean square between

MSw = mean square within

 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 58

After computing the F-test ratio value, decide as to whether accept or reject the

stated null hypothesis is based on the decision rule below.

Reject hypothesis if the computed P-value is less than or equal to the α level of 0.05.

Accept if otherwise.

3. Weighted Mean and Descriptive Rating

These statistical tools were used to determine the levels of the barangay

officials/employees financial management practices.

The formula for arithmetic mean is given by:

where:

A = average (or arithmetic mean)

n = the number of terms (e.g., the number of items or numbers being

averaged)

Xi = the value of each individual item in the list of numbers being averaged

Likert Scale Analysis was used to interpret items in the questionnaire. These are

psychological measurement devices that were used to gauge attitudes, values, and opinions.

It functions by having a person complete a questionnaire that requires them to indicate the

extent to which they agree or disagree with a series of statements, a method of ascribing

quantitative value to qualitative data, to make it amenable to statistical analysis.

Respondents rank their level of implementation from fully implemented to not implemented

using five levels. Data are then analyzed at the interval measurement scale. The scale used
 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 59

for the level of implementation of financial management practices of barangays in Sta.

Mesa in accordance to NGAS:

Scale Interpretation
Weighted Mean
5 4.21 - 5.00 Fully implemented

4 3.41 - 4.20 Implemented

3 2.61 - 3.40 Somehow Implemented

2 1.81 - 2.60 To A Certain Extent Implemented

1 1.00 - 1.80 Not Implemented

In addition, a different ranking was used by the researchers to analyze the problems

encountered based on the respondents work experience:

Scale Interpretation
Weighted Mean
5 4.21 - 5.00 Most Serious

4 3.41 - 4.20 Serious

3 2.61 - 3.40 Sometimes serious

2 1.81 - 2.60 Seldom serious

1 1.00 - 1.80 Never

The t-test assesses whether the means of two groups are statistically different from

each other. It was used to determine the significant difference between men and women

on the level of implementation of Financial Management of the barangay. Statistical

significance is determined by the size of the difference between the group average, the

sample size and the standard deviation of the group.

 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 60

Chapter 4

RESULTS AND DISCUSSION

This chapter includes the presentation of the gathered data, its analysis and

interpretation using the statistical tools mentioned in the previous chapter. The data

gathered were analyzed and presented in various tables in order of the specific questions

mentioned in the statement of the problem.

1. Respondents’ Demographic Profile

1.1 Profile of Individual Respondents

Table 1.

Frequency of Respondents According to Age

Age Frequency Percent

26-55 years 72 65.5
More than 55 years 38 34.5
Total 110 100.0

The Philippine Law prescribed that on the day of election, members of the

Sangguniang Barangay, Punong Barangay, and other appointed barangay officials should

be at least 21 years old. In this study, ages of the sample respondents varied from 26 to

more than 55 years. Age wise, the total number of respondents are divided into two

categories – namely between 26 and 55 years and over 55. As it is evident from the figure

1, most of the sample respondents are in the age group of 26-55 which is 65.5 percent of
 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 61

the 110 respondents. Only 34.5 percent of the officials belong to the age group over 55

years. Such result supports the study that concluded that older leaders are not better or

worse than younger leaders in achieving effective leadership (Boerrigter, 2015). This is

supported by a journal, the Leadership Quarterly, noting that people preferred the younger

looking leader for change and the older looking leader for stability.

Ages between 26 and 55 years are said to be in the adulthood stage. Leaders in

this phase are characterized by maturity, self-confidence, autonomy, solid decision-

making, and are generally more practical, multi-tasking, purposeful, self-directed,

experienced, and less open-minded and receptive to change. All these traits affect their

motivation, as well as their ability to learn and lead the barangay (Pappas, 2013). Ages

over 55 years, on the other hand, are in the late adulthood stage.

Differences among the two age groups can be seen in their physical strength.

According to the BBC News article "How Aging Affects Your Ability," aging is most likely to

affect job performance if job tasks require sensory perception, selective attention, working

memory, information processing, rapid reaction or physical strength. People with ages 55

years and above experiences such changes. With this, younger individuals tend to be

more productive that help them to come up with more creative solutions, and have more

fluid intelligence than older people. It looks as if when politics are keen to come up with

new ways of organizing themselves, they shift their preference to younger leaders (Vugt,

2014).

Table 2
 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 62

Frequency of Respondents According to Sex

Sex Frequency Percent

Male 63 57.3
Female 47 42.7

Total 110 100.0

Men and women also exhibit differences in leadership styles. The figure above

shows the distribution of sex of the sample respondents. Based on the results, 57.3% or

63 out of 110 respondents were male, while 42.7% or 47 respondents were female. This

only supports the study that concludes Philippine Politics as a man’s world (Umali, 2016).

One theory goes that society generally associates successful leadership with

stereotypically ‘masculine’ traits such as assertiveness and dominance, and so

disapproves of female leaders because they violate these gender norms. As a result

women experience greater obstacles to reaching the upper echelons (Bailey, 2014).

Acording to a study, women occupy only one-fifth (20%) of all elective positions in

the country, which is a meager 3,360 positions for women versus the whopping 13,407 for

men. From the highest to the lowest levels of government, men outnumber women in

elective positions (Umali, 2016). As a conclusion, women are making strides, but also

have a long way to go before reaching equality with men in terms of leadership.

Belief in political qualification provides the largest platform for the absences of

women in politics. Studies by the American University in 2011 survey indicate that “men

are 60 percent more likely than women to believe that they are “very qualified” to run for

office.” This research begs the question as to whether belief in qualification stems from
 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 63

ingrained gender perceptions in comparison to ability. Researchers Kathryn Pearson from

the University of Minnesota and Eric McGhee from the Public Policy Institute of California

suggest that women are equally as qualified as men in political affairs, in most cases, even

more qualified than their male counterparts. Deficiency of political knowledge provides

correlation between the the doubt women face and lack of political candidacy. The lack of

political knowledge stems from a lesser degree of consumption of politically based media,

concluding that the majority of news is “male-biased” (Gonzales, 2014).

The author further noted that the greatest enemy in the political sphere is the deeply

gendered stereotypes and lingering sexism that impede political ambition: the difference

between the male and female political experience. To narrow the gender gap between

men and women in politics it is imperative that it is understood that the root of the problem

does not necessarily relate to a lack of interest, rather a lack of ambition to carry out

political candidacy in a politically male-dominated world.

Table 3

Frequency of Respondents by Educational Attainment

Educational Attainment Frequency Percent

Elementary 1 .9
High School 23 20.9

Continuation of Table 3
 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 64

Educational Attainment Frequency Percent

College Degree 85 77.3
Master's Degree 1 .9
Total 110 100.0

Generally it is believed that education, leadership, and development are interrelated.

Despite of its’ importance, aside from being able to read and write, the law doesn’t

prescribed specific educational attainment among elective barangay officials.

The data shown in the figure 3 indicates that the majority of the respondents have

good educational background. 77.3 percent of the total respondents finished College,

while High school graduates constituted 20.9 percent. On the other hand, Elementary and

Masters’ Degree both comprised only .9 percent.

Dumlao (2016) cited in her study that college-educated leaders perform about the

same as or worse than those with less formal education. These leaders tend to perform

poorly in their works because it did not fit their educational qualification in the field of

barangay governance. Moreover, educational attainment has nothing to do with the level

of performance of barangay officials. She emphasized that barangay governance does

not need specialization and what’s important is the love for service to the people and basic

knowledge on administration.

On the other hand, (Pimentel 2010) recognizes the importance of educating both the

barangay officials and the people on the powers, duties and responsibilities of the

barangays so that from these basic political units, hopefully a national transformation can

emanate.
 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 65

To address lack in educational capacities of barangay officials, the government

provides seminars, training and workshops to guide barangay officials in the carrying out

of their barangay duties. The Department of Interior and Local Government (DILG)

conducts trainings for barangay officials to know their roles and responsibilities as they are

considered the “frontline” in terms of governance. According to a published article,

(Borromeo, 2011) stated that stay-in trainings for barangay treasurers will be held for them

to become more effective in their jobs instead of replacing them with persons who have

accounting backgrounds.

Table 4

Frequency of Respondents by Present Position

Present Position
Frequency Percent
Punong Barangay 36 32.7
Treasurer 39 35.5
Appropriation Chairman 31 28.2
Secretary 4 3.6
Total 110 100.0

As shown in Table 4, most of the respondents were Treasurer (35.5%), followed by

the Punong Barangay (32.7%). Appropriation Officer, whom task of monitoring the

utilization of appropriations with the use of the appropriate Records of Appropriations and

Obligations (RAO) were given, have 28.2 percent. Only 4 out of 110 respondents or 3.6

percent were Secretary.

 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 66

This result supports that in connection with the management of the barangay funds

and property, the barangay officials who are primarily responsible are the Punong

Barangay, Barangay Treasurer, and the Chairman of Appropriations.

Most of the respondents are treasurers because according to New Government

Accounting System, they are basically responsible for the collection of revenues in the

barangay. His responsibilities for fund management include collection of all taxes, fees,

contributions, and all other monies due the barangay. Also they safeguard, deposit, and

account revenue collections and all accountable forms in his custody. Thus, treasurer

performs most of financial management practices of barangays.

Table 5

Frequency of Respondents by Length of Experience in Government Service

Length of Experience Frequency Percent

Less than 1 year 2 1.8
1-2 years 1 .9
3-5 years 32 29.1
More than 5years 75 68.2
Total 110 100.0

This table shows that most of the respondents have a lengthy experience in

government service. 68.2 percent of the respondents were serving the public for more

than 5 years, followed by those who served for 3 to 5 years, 29.1 %. 1.8 percent of the
 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 67

total respondent experienced less than one year in government service and only .9

percent for 1 to 2 years. The researchers believe that one of the factors that affect the

more than 5 years length of government service of the officials is the benefits that they are

receiving from the government. The Local Government Code of 1991 provides that,

barangay officials shall receive different benefits and bonuses such as Christmas bonus in

the form of cash gift , insurance coverage, medical care consisting of free hospitalization in

government hospitals. Also, in extreme emergency, the same officials may be confined in

private hospitals with expenses chargeable against barangay funds at not more than

P5,000 per official; Free tuition and matriculation fees in government schools in their area

the officials including two of their legitimate dependent children during their term of office

only; conferment of civil service eligibility based on the number of years of service in the

barangay; and preference in appointment to any government position to which they are

qualified.

1.2. Profile of Barangay where the Individual Respondent is Residing

Table 6
 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 68

Frequency of Respondents According to Barangay Appropriation/Budget or

Internal Revenue Allotment (IRA)

IRA/Budget Frequency Percent

1,000,000-4,000,000 61 55.5
4,000,001-8,000,000 18 16.4
8,000,000 and above 31 29.1
Total 110 100.0

As it is evident from Table 6, Internal Revenue Allotment (IRA) among barangays

varies. Most of the barangays received an IRA of 1,000,001-4,000,000 which is 55.5

percent, followed by 29.1 percent of 8,000,000 and above IRA. The least amount of IRA

received in the barangays of Sta. Mesa is 4,000,001-8,000,000 which is 16.4 percent.

According to the Department of Budget and Management, the barangay annual

budget must include the following: Appropriations for development projects of not less than

20% of the total IRA of the barangay for the budget year (DevelopmentFund);

Appropriations for Sangguniang Kabataan (SK) programs, projects and activities

equivalent to 10% of the general fund of the barangay for the budget year (SK Fund);

Appropriations for unforeseen expenditures arising from the occurrence of calamities at

5% of regular income for the budget year (Calamity Fund); and Provision for the delivery of

basic services pursuant to Section 17 of RA No. 7160, and effective local governance.

In accordance to the law, fifty-five percent (55%) of Barangay funds is spent for

administrative expenses, whole forty-five percent (45%) is allocated for supporting its
 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 69

projects including infrastructure projects, health services, sports activities, beautification

and cleanliness projects, and such.

Allocation of funds among barangays also depends on the number of inhabitants.

Annual barangay budget ranging 1,000,000 to 4,000,000 supports the 36.3 percent mean

of the barangays having 500-2000 residents.

Barangay budget can be said to function as a legal instrument which authorizes the

use of barangay fund, an accounting framework for recording the application of such

funds, and a tool for planning the direction and magnitude of the use of funds. It should be

borne in mind by all barangay officials that spending barangay money without the requisite

budget duly approved by the sangguniang barangay, is a penal offense that is punishable

by law. Consequently, without a budget no funds can be spent for essential public services

in the barangay to the prejudice of its inhabitants (Ursal, 2001).

Table 7

Frequency of Respondents by Number of Residents

Number of Residents Frequency Percent

500-2000 40 36.3
2001-4000 32 29.2
More than 4000 38 34.5
Total 110 100.0

As provided in Section 386 of Local Government Code of the Philippines, a

Barangay maybe created out of a contiguous territory which has a population of at least
 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 70

two thousand (2,000) inhabitants as certified by the National Statistics Office except in

cities and municipalities within Metro Manila and other metropolitan political subdivisions

or in highly urbanized cities where such territory shall have a certified population of at least

five thousand (5,000) inhabitants.

As shown in Table 7, most of the barangays in Sta. Mesa comprises of 500-2000

residents which is 36.3 percent of the total respondents, followed by 34.5 percent for

barangays with more than 4000 inhabitants. Only 32 barangays or 29.2 percent have

2001-4000 residents.

2. Level of Implementation of Financial Management Practices of Barangays in

Sta. Mesa, in Accordance to New Government Accounting System

This part of the paper will provide the discussion and analysis of the perception of

respondents based on the Likert scale. Herein, it should be noted that the respondents or

officials connected with financial management practices of barangays’ in Sta. Mesa were

given a set of statements through the survey-questionnaire so as to express their

perception in the level of implementation of NGAS through the use of five-point Likert

scale. With this, 5 represent fully implemented, 4 for implemented, 3 for somehow

implemented, 2 to a certain extent implemented, and not implemented.

Table 8

Level of Implementation of Fundamental Principles in Accordance to NGAS

 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 71

Verbal
Fundamental Principles Mean Rank
Interpretation
1.     No money is paid out of the barangay fund except Fully
4.61 10
in fulfillment of an appropriations ordinance or law. Implemented
2.     Barangay funds and monies are spent solely for Fully
4.77 3
public purposes. Implemented
3.     No barangay fund or properties are applied for Fully
4.36 12
religious or private purposes. Implemented
4.     Disbursements of barangay funds or property
Fully
always bear the approval of the barangay captain and 4.87 1
Implemented
treasurer.
5.     All claims against barangay funds are supported Fully
4.82 2
with complete documentation. Implemented

6.     Barangay income is authorized by barangay

Fully
ordinance or law and collections are properly 4.72 5
Implemented
acknowledged and approved.

7.     All monies officially received by a barangay

Fully
treasurer are reported for as barangay funds, unless 4.64 8.5
Implemented
otherwise provided by law.

8.     All collections are deposited intact with

Fully
government depository bank, except those to be 4.75 4
Implemented
remitted to the City/Municipal Treasurer.

9.     Trust funds in the treasurer are paid out only for Fully
4.45 11
the purpose for which the trust was created. Implemented

1o.     Financial responsibilities are shared by all those

Fully
exercising authority over the financial transactions, and 4.7 6
Implemented
operations of the barangays.

Continuation of Table 8
 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 72

Verbal
Fundamental Principles Mean Rank
Interpretation
11.     Barangay treasurers and other accountable
barangay officers shall keep personal monies separate Fully
4.69 7
from barangay funds in their custody and shall not Implemented
make profit out of barangay money.
12.     Barangay accountable officers are appropriately Fully
4.64 8.5
designated and insured. Implemented
Fully
Weighted Mean Response 4.67  
Implemented

Table 8 shows the weighted mean response (4.67) which indicates that the

Fundamental Principles specified in the NGAS is fully implemented based on the scale

stated above. Moreover, the highest mean rating of 4.87 was given to the practice

indicating that the disbursements of barangay funds or property always bear the approval

of the barangay captain and treasurer. According on COA’s manual, the disbursement

vouchers will only be signed by the barangay chairman, barangay treasurer and the

barangay appropriation committee chairperson. The COA also recommended to the

barangay captains and treasurers that vouchers shall be numbered and shall indicate

every supporting document to the claim as required under the systems and procedures

Manual for Barangay relative to the proper accomplishment of vouchers. The absence of

approved disbursement of vouchers and supporting documents made the disbursements

of the barangay questionable insofar as the validity, propriety and legality of the

transactions are concerned.

Also, the practice specifying that all claims against barangay funds should be

supported with complete documentation having a mean of 4.82. The state auditors pointed

out Section 4.6 of Presidential Decree No. 1445 and the Policy and Procedure concerning

Disbursement by Check of the Systems and Procedures Manual on the Management of

 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 73

Barangay Funds and Property that “claims against government funds shall be supported

with complete documentation.”

Moreover, the provision indicating that Barangay funds and monies should be spent

solely for public purposes got the third to the highest mean of 4.77. As stated by Section

335 of RA 7160, it is clear and specific that no public money or property shall be

appropriated or applied for private purposes. This is in consonance with the fundamental

principle in local fiscal administration that local government funds and monies shall be

spent solely for public purposes. And as mentioned by Article 220 of the Revised Penal

Code, public officers who shall apply any public fund or property under his administration

to any public use other than for which such fund or property were appropriated by law or

ordinance shall be penalized.

While, the practice indicating that no barangay fund or properties are applied for

religious or private purposes, received the lowest mean of 4.36.In accordance to the law,

fifty-five percent (55%) of Barangay funds is spent for administrative expenses, whole

forty-five percent (45%) is allocated for supporting its projects, some of which include

infrastructure projects, sports activities, health services, beautification and cleanliness

projects,cultural & social services, sk activities, computerization programs, publication,

grants/donation and outreach programs.

Meanwhile, the practice that the trust funds in the treasurer are paid out only for the

purpose for which the trust was created, receives the second to the lowest mean score of

4.45. According to DBM, the barangay shall have the option to keep is funds as a trust

fund in the custody of the city/municipal treasurer or to deposit them in a bank, preferably

in a government owned or controlled bank. Special funds or trust funds from grants and

donations which are utilized for specific purposes do not accrue to the general fund of the
 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 74

barangay.

Verbal
Variables Mean Rank
Interpretation
1. The approved barangay fund is recorded in the
Records of the Appropriations and Obligations (RAO) Fully 1
4.72
and is maintained by the Chairman of the Committee Implemened
on Appropriations (CCA).
Lastly, the practice indicating that no money is paid out of the barangay fund except

in fulfillment of an appropriations ordinance or law received the third to the lowest mean

score of 4.61. Under the circular, the LGUs’ priority development projects should be

reflected in their approved local development plans and annual investment program (AIP),

which should be directly supportive of the Philippine Development Plan and the Public

Investment Program. The circular also prescribed the allowable projects that can be

funded through the 20 percent development fund, which are divided into three categories

— social development, economic development and environmental management projects.

On the other hand, the 20 percent development funds cannot be used to pay personnel

salaries and benefits; administrative expenses, traveling expenses; participation in

trainings, seminars, or conventions; and the purchase of office equipment and furnitures,

and motor vehicles. The circular is the responsibility of every local chief executive to

ensure that the 20 percent (development fund) is optimally utilized to help achieve the

desirable socio-economic development and environmental outcomes of the LGU

Table 9

Level of Implementation of Appropriations and Obligations in Accordance to NGAS

 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 75

Continuation of Table 9

Verbal
Variables Mean Rank
Interpretation
2 The RAO of the barangay shows the approved
Fully
annual barangay fund and the obligations charged 4.66 2
Implemened
against it.
3. Expenditures of the barangay in no case exceeded Fully
4.54 4
available funds. Implemened
4. Charges against the barangay funds shall be based Fully
4.65 3
on the obligations made. Implemened
5. CCA of the barangay regularly updates the RAOs
Fully
by posting all obligations to determine available 4.48 5
Implemened
balance of the appropriations.
Fully
Weighted Mean Response 4.61
Implemened

Table 9 shows the weighted mean response (4.61) which indicates that the

financial management of appropriations and management of barangays in Sta. Mesa,

Manila are fully implemented according to NGAS. Moreover, the highest mean rating of

4.72 was given to the statement that the approved barangay fund is recorded in the

Records of the Appropriations and Obligations (RAO) and is maintained by the Chairman

of the Committee on Appropriations (CCA). While the last item, stating that CCA of the

barangay regularly updates the RAOs by posting all obligations to determine available

balance of the appropriations, received the lowest mean of 4.48.

Practice of barangay wherein CCA of the barangay regularly updates the RAOs by

posting all obligations to determine available balance of the appropriations, received the

lowest mean of 4.48. Meanwhile, the practices that the Expenditures of the barangay in no

case exceeded available funds, received the second to the lowest mean of 4.54. Based on

our interview with some officials in barangay, this is because when it’s a very urgent

matter and they cannot prioritize following the provisions of NGAs. Lastly, practices
 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 76

wherein charges against the barangay funds shall be based on the obligations made,

received the third to the lowest mean of 4.65

Appropriation is an authorization made by law or other legislative enactment,

directing payment out of government funds under specified conditions or for specific

purposes. The Punong Barangay with the assistance of the Barangay Treasurer and in

consultation with the Sangguniang Barangay and Barangay Development Council

prepares the Barangay Budget. Capital budgeting is one of the most important areas of

financial management (Matteo Rossi). It plays a fundamental role in any firm’s financial

management strategy. As stated by Payongayong (2016), Capital Budgeting is a process

for evaluating an economic entity’s proposed long-range projects or courses of future

activity for the purpose of allocating limited resources to desirable projects. Effective

budgeting will help barangay to organize their spending and savings. It also helps to

maximize the utilization of barangay funds.

Table 10

Level of Implementation of Collections and Deposits/Remittances in Accordance to NGAS

Verbal
Collections and Deposits/Remittances Mean Rank
Interpretation
1. All collections are recognized through the Fully
issuance of strictly numbered Official Receipts 4.37 4
Implemented
2. Only checks in the name of barangay is
Fully
accepted as payment of obligation to barangay and 4.41 3
Implemented
issues the corresponding OR.
3. The OR is subject to proper custody, Fully
4.23
accountability and audit. Implemented 6
 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 77

Continuation of Table 10

Verbal
Collections and Deposits/Remittances Mean Rank
Interpretation
4. Collections are not used for payment of the Fully
4.43
barangay obligations. Implemented 2
5. Collections received by the Barangay Treasurer
(BT) are remitted intact to the city treasurer at least Fully
4.35
once a week or as practicable during heavy Implemented
5
collections.

6. The barangay maintains only one depository Fully

4.54
bank account. Implemented 1

Fully
Weighted Average Mean 4.39
Implemented

Table 10 resulted a 4.39 weighted average mean which indicates that the

collections and deposits/remittances of barangays in Sta. Mesa are fully implemented in

accordance with the New Government Accounting System (NGAS). The practice of the

barangay maintaining only one depository bank account yields the highest mean of 4.54.

On the other hand, the barangay’s practice subjecting the official receipt to proper custody,

accountability and audit got the lowest mean of 4.23. Overall, the practices of barangay

pertaining to the collections and deposits/remittances are fully implemented.

As mentioned above, barangay practice of maintaining only one depository

account ranked first. According to section 12 of COA Circular No. 92-382, provincial, city

and municipal treasurers shall maintain depository accounts in the name of their

respective local government units with banks, preferably government-owned, located in or

nearest to their respective areas of jurisdiction. This is in accordance with the imprest

system of accounting which is the system of depositing cash collections intact to a bank
 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 78

the bank. The practice of barangay wherein the collections are not used for payment of the

barangay obligations ranked second. This is due to the fact that barangay disbursements

must be made by drawing checks against its depository account. The third most fully

implemented practice is that only checks in the name of barangay is accepted as payment

of obligation to barangay and issues the corresponding OR. The OR number and date of

issue including the payor's control details shall be indicated at the back of the check for

reference purposes. The details of the check shall be indicated in the space provided in

the OR.

The barangay practice of subjecting the OR to proper custody, accountability and

audit got the lowest mean because based from what one punong barangay told the

researchers, they only observe such practice initially but afterwards they tend to neglect it.

On the other hand, the practice of remitting the collections received by the Barangay

Treasurer (BT) intact to the city treasurer at least once a week or as practicable during

heavy collections ranked second to lowest. And the practice that ranked third to the lowest

is the recognition of all collections through the issuance of strictly numbered Official

Receipts (OR) which shall be issued for all taxes, fees, charges, and contributions. These

three practices, despite of getting the lowest means, are still fully implemented. This is due

to the reason that these practices are explicitly mentioned by the Commission on Audit

which they must the barangay and its officials must abide.
 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 79

Table 11
Level of Implementation of Disbursements in accordance to NGAS

Variables Verbal Rank

Mean
Interpretation
1. Checks are used for disbursements. 4.68 Fully Implemented 3
2. Disbursements of the barangay fund were
made only on duly certified and approved 2
4.74 Fully Implemented
disbursements voucher, petty cash voucher, and
payroll.
3. The CCA certifies disbursements including 8
the disbursements of the Sangguniang 4.19 Implemented
Kabataan.
4. The BT certifies the disbursements voucher
as to the availability of funds for a complete 4.58 Fully Implemented 4
and correct supporting documents.
5. Disbursement in cash is made only from 6
funds, in which the payment is intended to 4.35 Fully Implemented
come from.
Cash advances for travel and other special purpose
6. Cash advances are granted for special
purpose and shall be liquidated upon 4.36 Fully Implemented 5
accomplishment of the purpose.
7. Liquidation documents are summarized in a
Liquidation Report (LR) and supported with 4.78 Fully Implemented 1
disbursement documents.
8. Any unused cash advances are returned and
Fully
an official receipt is issued by the Barangay 4.22 7
Implemented
Treasurer.
Petty Cash
9. The Barangay Treasurer/Petty Cash
Custodian is authorized by the Sangguniang
Barangay to hold a petty cash not above 11
3.73 Implemented
P10,000 which are maintained under the
imprest system and are periodically
replenished as needed.
10. The Barangay Treasurer/Petty Cash
Custodian are authorized to make direct 10
3.84 Implemented
purchases not above P1, 000 at any time for
the essential needs of the barangay.
11. The petty cash of the barangay is kept 9
3.93 Implemented
separately from other funds.
Weighted Mean Response Fully
4.31
Implemented
 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 80

The data presented in Table 11 shows the weighted mean response of 4.31 which

indicates that practices in barangays of Sta. Mesa, relating to disbursements, were fully

implemented in accordance to NGAS. Moreover, the highest mean rating of 4.78 was

given to the practice indicating that the liquidation documents are summarized in a

Liquidation Report and supported with disbursement documents. Accordingly, this is

because of COA’s strictness as to carrying out its policies.

Additionally, the practice relating to the disbursements of the barangay fund with

duly certified and approved disbursement documents got the second highest mean of 4.74,

for the reason that these documents are used as basis for charges against

appropriation. Furthermore, the third lowest mean of 4.68 was received by the practice

wherein checks are used for disbursements as imprest system is also incorporated in

barangay cash management.

While the practice wherein the Barangay Treasurer/Petty Cash Custodian is tasked

to hold a petty cash not above P10,000, received the lowest mean of 3.73. This is because

the established petty cash fund of the barangays is not enough to cover up their small

expenses. The size of a petty cash fund varies depending on the needs of the barangays..

Meanwhile, the practice that the Barangay Treasurer/Petty Cash Custodian are

authorized to make direct purchases not above P1, 000 at any time for the essential needs

of the barangay, received the second to the lowest mean of 3.84. This is because in times

of emergencies, barangay officials do not prioritize following the provisions of NGAS most

especially when it’s a very urgent matter. And lastly, the practice that the petty cash of the

barangay is kept separately from other funds, received the third to the lowest mean of

3.93. This is because sometimes, the petty cash fund is mixed with other funds

unintentionally.
 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 81

Cash disbursement includes all outlays of cash by barangays during a given

financial period (Gitman, 2008). Cash is known to be the most liquid asset thus most

susceptible to theft and misappropriation. As stated by Robles (2015), effective cash

management requires controls to protect cash from loss through theft and fraud. As one of

the characteristics of effective cash management, the barangays must practice an imprest

and voucher system. Imprest system is characterized by daily deposit of all cash receipts

intact to the bank and making disbursements through issuance of checks. This system

prevents the presence of significant amount of cash balance within the business vicinity.

However, an enterprise considers it inconvenient and impractical to write checks for small

item thus a need for an imprest petty cash fund which provides simple but effective control

over small amounts of expenditures. Having the right amount of petty cash on hand

enables a barangay to respond quickly to barangay needs as they arise. With proper

controls, a petty cash fund is a valuable tool that keeps barangay rolling without the

cumbersome task of writing a check each time small amounts of money are needed.

Under the voucher system, all disbursements must be supported by properly

approved vouchers, which must be recorded in the cash register. A voucher system sets

up procedures to safely verify, approve, record, and issue cash disbursements. The

voucher system establishes safeguards to protect a company's cash.

These measures may not totally eliminate the possibilities if misappropriation of

errors but can significantly reduce the chances of theft, loss, or inadvertent errors in the

management of cash.
 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 82

Table 11
Level of Implementation of Supplies in accordance to NGAS

Verbal
Supplies Mean Rank
Interpretation
1.   Purchase of supplies and materials of the
barangay are charged to Maintenance and Other Fully
4.65 1
Operating Expenses and recorded using the Implemented
appropriate expense accounts.
2.   Usage of supplies of barangay is supported by an Fully
4.37 3
approved Requisition and Issue Slip. Implemented
3.   The supplies of the barangay with serviceable life
Fully
of more than one year are covered by an Inventory 4.35 4
Implemented
Custodian Slip.
4.   Stock Card is maintained to monitor and control
disbursement and usage/consumption of supplies and 3.86 Implemented 5
materials of the barangay.
5.   Issuance and purchase of supplies and materials
Fully
of the barangay is covered or supported by an 4.49 2
Implemented
approved Purchase Request and Purchase Order.
Fully
Weighted Mean Response 4.35  
Implemented

The data presented in Table 11 shows the weighted mean response of 4.35 which

indicates that practices in barangays of Sta. Mesa, were fully implemented in accordance

to NGAS. In addition, the highest mean rating of 4.65 was given to the practice indicating

that purchase of supplies and materials of the barangay are charged to MOOE and

recorded using the appropriate expense account. It is then followed by the statement that

issuance and purchase of supplies and materials of the barangay is covered or supported

by an approved purchase request and purchase order which received a weighted mean of

4.49. While maintenance of stock card to monitor and control disbursement and

usage/consumption of supplies and materials of the barangay showed the lowest mean of

3.86. According to NGAS, stock card shall be used to record all receipts and issues of

supplies and the balance in quantity at any time. It shall be maintained by the Property
 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 83

and/or Supply Division/Unit for each item in stock and according to one of the barangay

chairman, maintaining stock card is recurring, tiring to do and very time consuming.

On the other hand, the supplies of the barangay with serviceable life of more than

one year are covered by inventory custodian slip received 4.35 mean which is the second

to the lowest mean. And lastly, usage of supplies of barangay is supported by an approved

requisition and issue slip, received the third to the lowest mean of 4.37. Requisition and

Issue Slip (RIS) shall be used by the end-user to request issue of supplies and materials

that are carried on stock. It is also used by the Property and/or Supply Division/Unit to

indicate availability or non-availability of items requisitioned and/or to record issues of

item/s requisitioned.

Supplies and materials are consumable items which commonly have a shorter life

span in use than equipment and machines, and which are stocked for recurring use.

According to New Government Accounting Systems, the Accounting Unit shall maintain

Supplies Ledger Cards by stock number.

The Accounting Division/Unit shall be responsible in computing the cost of

inventory on a regular basis on Supplies Ledger Card (SLC). Supplies and materials

purchased for inventory purpose shall be recorded using the perpetual inventory system,

resulting in a more accurate inventory records and a running total for the cost of goods

sold in each period. The system requires accounting records to show the amount of

inventory on hand at all times through the maintenance of the SLC by the Accounting

Division/Unit and Stock Card (SC) by the Supply and/or Property Division/Unit for each

item in stock. Regular purchases shall be coursed through the inventory account and

issues thereof shall be recorded as they take place except for supplies and materials
 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 84

purchased out of PCF for immediate use or on emergency cases which shall be charged

directly to the appropriate expense accounts.

The Inventory Accounting System consists of the system of monitoring, controlling

and recording of acquisition and disposal of inventory. The system starts with the receipt of

the purchased inventory items. The requesting office in need of the inventory items, after

the Property and Supply Division/Unit has determined that the items are not available in

stock, shall prepare and cause the approval of the Purchase Request (PR). Based on the

approved PR and after accomplishing all the required procedures adopting a particular

mode of procurement, the agency shall issue a duly approved Contract or Purchase Order

(PO). Physical count/inventory, which is required semi-annually, is an indispensable

procedure for checking the integrity of property custodianship.

Verbal
Variables Mean Rank
Interpretation
1. Sending the property and equipment to its
user is acknowledged by the Property
Fully
Acknowledgement Receipt which is renewed at 4.23 4
Implemented
least every three years or whenever there is a
change in custodianship.
2. Property/Equipment Card are maintained for all
4.05 Implemented 5
property and equipment of the barangay.
3. Request and purchases of property, plant and
Fully
equipment are supported by an approved 4.56 3
Implemented
purchase document.
4. All deliveries of property, plant and equipment are Fully
4.66 1
supported by Acceptance and Inspection Report. Implemented
5. The Barangay conducts a yearly physical
Fully
count of all supplies, property and equipment of 4.61 2
Implemented
the barangay.
Weighted Mean Response Fully
4.42
Implemented
Table 12

Level of Implementation of Plant, Property, and Equipment in accordance to NGAS

 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 85

As shown on the table above, all deliveries of property, plant and equipment are

supported by Acceptance and Inspection Report (AIR), reflected by a 4.66 mean, is the

highest among the data presented. This is because AIR is very important for the barangay

to confirm and secure the properties and equipment that they receive. Also, this is done at

the start when the barangay first receive the deliveries of the properties and equipment.

Next to this is the practice with the 4.61 mean which states that the barangay conducts a

yearly physical count of all supplies, property and equipment of the barangay, for the

reason that it is essential to check if the inventory accounting records are accurate and

complete at a particular time.

On the other hand, the item with the lowest mean of 4.05 is the practice that

Property/Equipment Card is maintained for all property and equipment of the barangay. As

time passes, some barangay officials are gradually getting exhausted and inactive in

maintaining a property/equipment card, as said by one of the barangay chairmen. This is

the same with the practice with second to the lowest mean of 4.23 that sending the

property and equipment to its user is acknowledged by the Property Acknowledgment

Receipt is renewed at least every three years or whenever there is a change in

custodianship. After some years in public service, a few barangay officials tend to be lazy

in renewing the PAR. The practice that request and purchases of property, plant and

equipment are supported by an approved purchase document has a mean of 4.56 which

pertains to the middle mean of the results.

The overall mean is 4.42. The data above indicate that the respondents fully

implement the financial management in their PPE.

The New Government Accounting System (NGAS) adopts the definition of

Property, Plant and Equipment under the International Accounting Standards No. 16 which
 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 86

states that: "Property, Plant and Equipment are tangible assets that: (a) are held by an

enterprise for use in the production or supply of goods or services, for rental to others, or

for administrative purposes; and (b) are expected to be used during more than one period."

An inventory committee headed by the barangay captain or any representative

upon his appointment as chairman and barangay treasurer as member, should conduct the

physical count of all PPE.

Upon the completion of the physical inventory, the inventory team shall prepare a

report on the physical count of PPE (RPCPPE) and this shall be submitted to the barangay

record keeper (BRK) and the city accountant for reconciliation with the recorded PPE.

All the property and equipment of the barangay must be maintained by a

property/equipment card. Property card is an individual record of Property, Plant &

Equipment that has its description, acquisition, transfer/disposal and other information

about the asset. The purchasing officer shall make up a property card which contains the

same information as the property log, for each individual item. The location entry on this

card shall be revised each time the item is moved to a new location, and/or the responsible

department changes. The acquisition value shown on the property card and on the

property log must agree at the time of acquisition.

A Property Acknowledgment Receipt (PAR) shall be prepared by the Barangay

Treasurer upon issuance of property and equipment. The PAR shall be prepared and

distributed in two copies as follows: Original is for the Barangay Treasurer, 2 nd copy is for

the end-user, and the 3rd copy is for the C/M Accountant. The recipient who is accountable

for the property and equipment shall sign in the “receive by” portion of the form and

indicate the date of receipt. The Barangay Treasurer shall sign in the Issued by portion and
 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 87

indicate the date. The PAR shall be renewed every three years or every time there is a

change custodianship/user of the property.

In case of any lost or missing and unrecorded PPE, the inventory team shall inform

the barangay captain and the city accountant in writing about such loss so that the

accountant will record the missing PPEs as a reduction from assets owned by the

barangays.

3. Significant difference on the respondents’ level of implementation of the

financial management practices of barangay according to NGAS when they are

grouped according to their profile

Table 13

Significant Difference on the Level of Implementation of NGAS according to Age

Variables Age Mean F-Test P-Value Remarks

26-55 years 4.68
Fundamental Not
More than 55 years 4.66 0.0419 0.9885
Principles Significant
Total 4.67
26-55 years 4.59
Appropriations and Not
More than 55 years 4.64 0.0478 0.9861
Obligations Significant
Total 4.61
26-55 years 4.36
Collections and Not
More than 55 years 4.35 0.2910 0.8318
Deposits/Remittances Significant
Total 4.39
26-55 years 4.33
Not
Disbursements More than 55 years 4.20 0.4168 0.7413
Significant
Total 4.31
 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 88

Continuation of Table 13

Variables Age Mean F-Test P-Value Remarks

26-55 years 4.40
Supplies and More than Not
4.29 0.1970 0.8983
Materials 55 years Significant
Total 4.35
26-55 years 4.4
Property, Plant and
More than Not
Equipment/Infrastruct 4.45 0.7886 0.5029
55 years Significant
ure Assets
Total 4.42

As shown in the table above, there was no significant difference in the level of

implementation of financial management according to NGAS when grouped according to

their age. Most of the respondents are 46-55 years old. As a barangay official, they need

to implement the provisions of the New Government Accounting System whether they

belong to the young or old generation.

Table 14

Significant Difference on the Level of Implementation of NGAS according Sex

Variables Sex Mean F-Test P-Value Remarks

Fundamental Male 4.69
0.5711 0.5691 Not Significant
Principles Female 4.64
Appropriations and Male 4.55
-1.3436 0.1819 Not Significant
Obligations Female 4.69
Collections and Male 4.38
-0.1716 0.8641 Not Significant
Deposits/Remittance Female 4.40
Male 4.24
Disbursements -0.9921 0.3234 Not Significant
Female 4.40
Supplies and Materials Male 4.30
-0.6803 0.4978 Not Significant
Female 4.40
Property, Plant and Male 4.35
Equipment/Infrastructu Female 4.53 -1.2198 0.2252 Not Significant
re Assets
This table demonstrates the test of variations in the level of compliance on New

Government Accounting System in terms of Fundamental Principles, Appropriations and

 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 89

Obligations, Collections and Deposits/Remittances, Disbursements, Supplies and

Materials, Property, Plant and Equipment/Infrastructure Assets, and Problems

encountered based on sex. The different p-values measure the significance of every

outcome. The table shows that there were no significant differences on the first six

variables that resulted in p-values of 0.5691, 0.1819, 0BA.8641, 0.3234, 0.4978 and

0.2252 respectively. However, the last variable shows a significant difference of 0.0077

since its p-value is lower that the level of significant set of .05. Based on the data provided

in the table, males have higher weighted average mean for fundamental principles and

problems encountered of 4.69 and 2.64, respectively. On the other hand, females got

higher weighted average mean for appropriations and obligations, collections and

deposits/remittances, disbursements, supplies and materials, property, plant and

equipment/infrastructure assets of 4.69, 4.40, 4.40, 4.40 and 4.53 respectively.

Table 15

Significant Difference on the Level of Implementation of NGAS according to Highest Educational

Attainment

Highest
Variables Educational Mean
F-Test P-Value Remarks
Attainment
Elementary 5.00
High School 4.45
Fundamental College Degree 4.72 2.1758 0.0952 Not Significant
Principles Master's Degree 4.67
Total 4.67

Continuation of Table 15.

Highest
 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 90

Variables Educational Mean F-Test P-Value Remarks

Attainment
Elementary 5.00
High School 4.43
Appropriations and College Degree 4.65 1.2109 0.3094 Not Significant
Obligations Master's Degree 4.80
Total 4.61
Elementary 5.00
High School 4.07
Collections and College Degree 4.46 1.5848 0.1974 Not Significant
Deposits/Remittances Master's Degree 5.00
Total 4.39
Elementary 5.00
High School 3.90
College Degree 4.41 2.5964 0.0563 Not Significant
Disbursements Master's Degree 4.45
Total 4.31
Elementary 5.00
High School 4.13
College Degree 4.40 1.0290 0.3829 Not Significant
Supplies and Materials Master's Degree 4.60
Total 4.35
Elementary 5.00
High School 4.13
Property, Plant and College Degree 4.49 1.7060 0.1702 Not Significant
Equipment/Infrastructure Master's Degree 5.00
Assets Total 4.42

Based from the table above, there was no significant difference in the level of

implementation of financial management according to New Government Accounting

System when grouped corresponding their highest educational attainment. This is due to

the fact that whether they attained elementary level, high school level, college degree or

master’s degree, trainings and seminars are provided by the government to guide

barangay officials in the implementation of NGAS.

Table 16
 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 91

Significant Difference on the Level of Implementation of NGAS according to Position

Variables Positions Mean F-Test P-value Remarks

Punong Barangay 4.68
Treasurer 4.6
Fundamental Not
Appro Chairman 4.71 0.8262 0.4823
Significant
Secretary 4.96
Total 4.67
Punong Barangay 4.69
Treasurer 4.52
Appropriations and Not
Appro Chairman 4.59 1.2637 0.2907
Obligations Significant
Secretary 5
Total 4.61
Punong Barangay 4.36
Treasurer 4.26
Collections and Not
Appro Chairman 4.52 1.0338 0.3808
Deposits/Remittances Significant
Secretary 4.92
Total 4.39
  Punong Barangay 4.24
Treasurer 4.38
Not
Appro Chairman 4.23 0.9761 0.407
Disbursements Significant
Secretary 4.91
Total 4.31
Punong Barangay 4.27
Treasurer 4.43
Not
Supplies and Materials Appro Chairman 4.25 1.4305 0.238
Significant
Secretary 5
Total 4.35
Punong Barangay 4.51
Property, Plant and Treasurer 4.4
Not
Equipment/Infrastructur Appro Chairman 4.28 1.1221 0.3436
Significant
e Assets Secretary 4.95
Total 4.42

Table 16 presents the test for any distinction among the compliance on

Fundamental Principles, Appropriations and Obligations, Collections and

 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 92

Deposits/Remittances, Disbursements, Supplies and Materials, Property, Plant and

Equipment/Infrastructure Assets, as stated in NGAS, of the barangay officials based on

Barangay position. The different p-values of the indicators measure the significance for

every outcome.

Based on Table 16, secretary had higher mean scores for all variables, specifically,

Fundamental Principles, Appropriations and Obligations, Collections and

Deposits/Remittances, Disbursements, Supplies and Materials, Property, Plant and

Equipment/Infrastructure Assets of 4.96, 5.00, 4.92, 4.91, 5.00, and 4.95 respectively. The

related tables for One Way Analysis of Variance revealed that there was statistically no

significant difference between Punong Barangay, Treasurer, Appropriation Chairman and

Secretary because the computed p-value of the all variables

(p=0.4823;0.2907;0.3808;0.4070;0.2380;0.3436) were greater than the level of

significance set at 0.05.

Thus, all of the respondents whether Punong Barangay, Treasurer, Appropriation

Chairman and Secretary have no significant difference in answering the compliance on

Fundamental Principles, Appropriations and Obligations, Collections and

Deposits/Remittances, Disbursements, Supplies and Materials, Property, Plant and

Equipment/Infrastructure Assets, as stated in NGAS, of the barangay officials based on

Barangay position. Presumably, this is because the number of secretary who participated

in our survey is only 4 out of 110 which is 3.65 percent of the total number respondents.

Table 17
 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 93

Significant Difference on the Level of Implementation of NGAS according to Length of

Experience in Government Service

Length of
Variables Mean F-Test P-value Remarks
Experience
Less than 1 year 4.67
1-2 years 4.33
Not
Fundamental Principles 3-5 years 4.64 0.2311 0.8746
Significant
More than 5 years 4.69
Total 4.67
Less than 1 year 4.3
1-2 years 5
Appropriation and Not
3-5 years 4.54 0.5941 0.6202
Obligation Significant
More than 5 years 4.64
Total 4.61
Less than 1 year 4
1-2 years 3.67
Collections and Not
3-5 years 4.27 0.7552 0.5217
Deposits/Remittances Significant
More than 5 years 4.46
Total 4.39
Less than 1 year 3.5
1-2 years 2.45
Not
Disbursements 3-5 years 4.26 2.5918 0.0566
Significant
More than 5 years 4.38
Total 4.31
Less than 1 year 4.3
1-2 years 4.2
Not
Supplies and Materials 3-5 years 4.34 0.0189 0.9965
Significant
More than 5 years 4.35
Total 4.35
Less than 1 year 4.60
Property, Plant and 1-2 years 3.40
Not
Equipment/Infrastructur 3-5 years 4.44 0.6145 0.6071
Significant
e Assets More than 5 years 4.43
Total 4.42

Based from the table above, there was no significant difference in the level of

implementation of financial management according to New Government Accounting

System when grouped corresponding to their length of service in Government service.

This is in accordance with Republic Act No. 7160, otherwise known as the Local
 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 94

Government Code of 1991 that No local elective official shall serve for more than three (3)

consecutive terms in the same position. Voluntary renunciation of the office for any length

of time shall not be considered as an interruption in the continuity of service for the full

term for which the elective official concerned was elected

Table 18

Significant Difference on the Level of Implementation of of NGAS according to Annual

Budget/IRA

Barangay F- P-
Variables Mean REMARKS
Budget/IRA TEST VALUE
1,000,000-4,000,000 4.66
Fundamental 4,000,001-8,000,000 4.74 Not
1.2345 0.2983
Principles 8,000,001 and above 4.71 Significant
Total 4.67
1,000,000-4,000,000 4.61
Appropriations and 4,000,001-8,000,000 4.48 Not
1.2109 0.3094
Obligations 8,000,000 and above 4.69 Significant
Total 4.61
1,000,000-4,000,000 4.35
Collections and 4,000,001-8,000,000 4.4 Not
1.5848 0.1974
Deposits/Remittances 8,000,000 and above 4.54 Significant
Total 4.39

Continuation of Table 18

Barangay F- P-
Variables Mean REMARKS
Budget/IRA TEST VALUE
1,000,000-4,000,000 4.29 Not
Disbursements 2.5964 0.0563
4,000,001-8,000,000 4.39 Significant
 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 95

8,000,000 and above 4.15

Total 4.31
1,000,000-4,000,000 4.39
Supplies and 4,000,001-8,000,000 4.3 Not
1.029 0.3829
Materials 8,000,000 and above 4.27 Significant
Total 4.35
1,000,000-4,000,000 4.29
Property, Plant and 4,000,001-8,000,000 4.4 Not
Equipment/ 1.706 0.1702
8,000,000 and above 4.64 Significant
Infrastructure Assets
Total 4.42

Table 18 indicates the test of distinction in the level of compliance on New

Government Accounting System in terms of fundamental principles, appropriations and

obligations, collections and deposits/remittances, disbursements, supplies and materials,

property, plant and equipment/infrastructure assets, and problems encountered based on

barangay appropriations/budget or Internal Revenue Allotment (IRA).

The table shows that there is no significant difference among all the variables

presented since they are all higher than the significant set of 0.05

The variable, fundamental principles got the highest total weighted average mean of

4.67 while the variable, disbursements got the lowest total weighted average mean of 4.31.

The problems encountered resulted to a 2.41 total weighted average mean.

4. The problems encountered by the respondents in line with the implementation

of NGAS in the financial management practices of Sta. Mesa.

Table 19

Problems encountered of respondents in the implementation of NGAS

 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 96

Problems Encountered
Verbal
Variables Mean Rank
Interpretation
1. The barangay officials are not aware of
the Financial Management of Barangay
2.35 Seldom Serious 4
Government Accounting Manual and its
provision.
2. The barangay officials lack the capability
2.36 Seldom Serious 3.5
of accounting barangay funds.
3. The implementation procedures are
2.50 Seldom Serious 1
difficult, tedious, and time-consuming.
4. There is a lack of training and orientation
2.45 Seldom Serious 2
among barangay officials.
5. Problems regarding the implementation of
Financial Management Practices of
Barangay in accordance to Government 2.36 Seldom Serious
3.5
Accounting Manual are not immediately
addressed by the barangay officials.
Weighted Mean Response 2.41 Seldom Serious

Most of the barangays in Sta. Mesa do not have a centralized and accurate system

for storing records they have for these are very important to them. As shown on the table

above, majority of the respondent’s problem encountered was implementation procedures

are difficult, tedious, and time-consuming, reflected by a 2.50 mean which is the highest

among the data presented. According to one of the barangay treasurer, this is because

reporting of the barangay funds appropriation is recurring and tiring to do. As stated by

Sec. Jesse Robredo, former DILG Secretary, the barangay being the basic political unit

has always been at the forefront of local development undertakings in the country.

Collectively, the barangay are partners of the national government to respond to

development challenges because of their strategic situation at the grassroots level

especially in the effective and efficient service delivery reflects the state of national

government. To help national government in responding to development challenges,

barangay need to present a reliable and accurate barangay fund appropriations.

 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 97

Moreover, there is a lack of training and orientation among barangay officials

having a 2.45 mean. Training is crucial for organizational development and success. It is

fruitful to both employers and employees of an organization. An employee will become

more efficient and productive if he is trained well. And lastly, the barangay officials lack

the capability of accounting barangay funds, received the third to the highest mean of

2.36. To be able to carry out its mandate, the LGU at the barangay level has two

essential needs: 1) The adequate funding to finance all these responsibilities; and, 2) the

competency to raise and use these finances efficiently. Both are necessary; one is

deficient without the other. However, the latter is the more important of the two because

in the case where finances are insufficient, competent leaders can demonstrate

resourcefulness in generating revenues.

As stated by Jaime Naranjo, former president of the Government Association of

Certified Public Accountants or GACPA, Government accountants are having problems

checking how barangays spend their funds because many barangay treasurers,

especially those from remote areas, do not have the skills and knowledge to perform their

duties. The lack of knowledge and skills becomes a problem because then barangay

chiefs can control their respective treasurers and sometimes have them do things that are

already against government accounting rules.

5. Significant difference on respondents’ problem encountered when they are

grouped according to their profile

Table 20
 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 98

Significant Difference in the Problems Encountered by Barangay officials According to

Age

Variables Age Mean F-Test P-Value Remarks

26-55 2.24
Problems Not
More than 55 2.62 1.1285 0.3410
Encountered Significant
Total 2.41

Based on the table shown, when the respondents are grouped according to their

age, the problems encountered are not significant. Every official, regardless of their age,

find the problems encountered to be seldom serious only. The age range that has the

highest mean is more than 55 years old.

Table 21

Significant Difference in the Problems Encountered by Barangay officials According to

Sex

Variables Sex Mean F-Test P-Value Remarks

Problems Male 2.64
2.7180 0.0077 Significant
Encountered Female 2.09

. The table above shows that there was a significant difference in relation to the

responses on the problems encountered when sort according to the barangay officials’

sex. It can be said that whether the respondents are female or male, can influence the

responses on the encountered problems. Thus, the correlation between the two factors

deduces the researchers to not reject the null hypothesis.

 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 99

Table 22

Significant Difference in the Problems Encountered by Barangay officials According to

Position

The table depicts that there was no significant difference between the responses of

the barangay officials on the problems encountered when grouped according to their

positions in the Barangay. Overall, whether the official is a punong barangay, treasurer,

appropriation chairman, or a secretary, the researchers failed to reject the null hypothesis.

There is an insignificant effect in regards to the problems encountered based on the

P-
Variables Positions Mean F-Test Remarks
value
Punong Brgy 2.48
Treasurer 2.45
Problems Not
Appro Chairman 2.40 1.3769 0.2539
Encountered Significant
Secretary 1.30
Total 2.41

respondent’s position.

Table 23

Significant Difference in the Problems Encountered by Barangay officials According to

Educational Attainment

Variable Experience Mean F-Test P-Value Remarks

Problems Elementary 1.00

Not
Encountered High School 2.21 0.8853 0.4513
Significant
College Degree 2.47
 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 100

Master's Degree 2.80

Total 2.41

The table depicts that there was no significant difference between the responses of

the barangay officials on the problems encountered when grouped according to their

educational attainment. Overall, whether the official is a punong barangay, treasurer,

appropriation chairman, or a secretary, the researchers failed to reject the null hypothesis.

There is an insignificant effect in regards to the problems encountered based on the

educational attainment.

Table 24

Significant Difference in the Problems Encountered by Barangay officials According to Length

of Experience

Variable Experience Mean F-Test P-Value Remarks

Less than 1 year 3.50
1-2 years 1.00
Problems
3-5 years 2.01 3.1691 0.0274 Significant
Encountered
More than 5 years 2.57
Total 2.41

The table depicts there was a significant difference between the responses of the

barangay officials on the problems encountered when grouped according to the length of

their experience in government service. Overall, whether the official is a punong barangay,

treasurer, appropriation chairman, or a secretary, the researchers failed to reject the null

hypothesis. There is significant effect in regards to the problems encountered based on

the respondent’s position.

 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 101

Table 25

Significant Difference in the Problems Encountered by Barangay officials According to

Barangay Appropriation/IRA

Barangay P-
Variables Mean F-TEST REMARKS
Appropriation/IRA VALUE
1,000,000-4,000,000 2.28
Problems
4,000,001-8,000,000 2.53 Not
Encountered 0.6386 0.6708
8,000,000 and above 2.63 Significant
 
Total 2.41

The table shows that there was no significant difference between the responses of

the barangay officials on the problems encountered when grouped according to the annual

barangay budget. Overall, whether the official is a punong barangay, treasurer,

appropriation chairman, or a secretary, the researchers failed to reject the null hypothesis.

There is insignificant effect in regards to the problems encountered based on this profile.

6. Problems encountered by the respondents when they are grouped according to

their profile

Table 26

Problems Encountered According to Age

Problems Encountered Age Frequency Mean Rank

1. The barangay officials are not aware of the 26-55 years 72 2.19 5.00
 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 102

Financial Management of Barangay’s New More than 55 years 38 2.55

Government Accounting System and its provision. Total 110 2.35
26-55 years 72 2.27
2. The barangay officials lack the capability of
More than 55 years 38 2.55 3.50
accounting barangay funds.
Total 110 2.36
26-55 years 72 2.31
3. The implementation procedures are difficult,
More than 55 years 38 2.79 1.00
tedious, and time-consuming.
Total 110 2.50
26-55 years 72 2.28
4. There is a lack of training and orientation
More than 55 years 38 2.66 2.00
among barangay officials.
Total 110 2.45
5. Problems regarding the implementation of 26-55 years 72 2.17
Financial Management Practices of Barangay in
accordance to New Government Accounting More than 55 years 38 2.53 3.50
System are not immediately addressed by the Total 110 2.36
barangay officials.
26-55 years 72 2.24
Weighted Mean More than 55 years 38 2.62
Total 110 2.41

The table above shows that when grouped according to their age, barangay

officials who are more than 55 years old had a tough time in resolving those problems.

Contrariwise, officials who are 26-55 years old are less troubled in the problems

mentioned. This is seemingly because those who are 26-55 years old are more competent

and more proficient in adapting the Financial Management of Barangay’s New

Government Accounting System and its provisions, hence, they are less concerned by the

problems encountered.

Table 27

Problems Encountered According to Sex

 
Problems Encountered Sex Frequency Mean
Rank
1. The barangay officials are not aware of the Male 63 2.67 5
 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 103

Financial Management of Barangay’s New Female 47 1.91

Government Accounting System and its provision. Total 110 2.29
Male 63 2.59
2. The barangay officials lack the capability of
Female 47 2.06 4
accounting barangay funds.
Total 110 2.33
Male 63 2.68
3. The implementation procedures are difficult,
Female 47 2.26 1
tedious, and time-consuming.
Total 110 2.48
Male 63 2.71
4. There is a lack of training and orientation among
Female 47 2.11 2
barangay officials.
Total 110 2.41
5. Problems regarding the implementation of Male 63 2.56
Financial Management Practices of Barangay in
Female 47 2.11
accordance to New Government Accounting 3
System are not immediately addressed by the Total 110 2.34
barangay officials.

The table shows that there is a significant difference in relation to the responses on

the problems encountered when sort according to the barangay officials’ sex. It can be

said that whether the respondents are female or male, can influence the responses on the

encountered problems.

The table delineates that the most serious problem that is considered by the

barangay officials is the implementation procedures that are difficult, tedious, and time-

consuming. The male respondents found the problem more serious than the female

respondents by 0.42 in terms of their weighted average mean. Meanwhile, the problem

wherein the barangay officials are not aware of the Financial Management of Barangay’s

New Government Accounting System and its provision was the least serious problems

encountered. The male respondents are more concern with the said problem by 0.76

weighted average mean as compared to the females.

Table 28
 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 104

Problems Encountered According to Educational Attainment

Educational
Problems Encountered Frequency Mean Rank
Attainment
Elementary 1 1  
1. The barangay officials are not aware of the High School 23 2.09  
Financial Management of Barangay’s New
College Degree 85 2.42 5
Government Accounting System and its
Master’s Degree 1 3  
provision.
Total 110 2.35  
Elementary 1 1  
High School 23 2.04  
2. The barangay officials lack the capability
College Degree 85 2.46 3.5
of accounting barangay funds.
Master’s Degree 1 3  
Total 110 2.36  
Elementary 1 1  
High School 23 2.3  
3. The implementation procedures are
College Degree 85 2.58  
difficult, tedious, and time-consuming.
Master’s Degree 1 2 1
Total 110 2.5  
Elementary 1 1  
High School 23 2.52  
4. There is a lack of training and orientation
College Degree 85 2.45 2
among barangay officials.
Master’s Degree 1 3  
Total 110 2.45  
5. Problems regarding the implementation of Elementary 1 1
Financial Management Practices of High School 23 2.09
Barangay in accordance to New Government College Degree 85 2.45 4
Accounting System are not immediately Master’s Degree 1 3
addressed by the barangay officials. Total 110 2.36

The table presents the least to most serious problems encountered by the barangay

officials in the implementation of NGAS in their respective barangays. The most serious

problem is that the implementation procedures are difficult, tedious, and time-consuming.

The respondents who attained college degree considered this more serious than those

who attained elementary level, high school level and master’s degree by 1.58, 0.28 and

0.58 respectively, based on their weighted mean. On the other hand, the problem wherein

the barangay officials are not aware of the Financial Management of Barangay’s New

Government Accounting System and its provision is considered the least serious by the
 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 105

respondents. The respondent/s who attained master’s degree perceived this problem to

be a minor one than those who attained elementary level, high school level and master’s

degree by 2, 0.91 and 0.58 respectively.

Table 29

Problems Encountered According to Position

Problems Encountered Position Frequency Mean Rank

Punong Barangay 36 2.36  

1. The barangay officials are not aware of the Treasurer 39 2.46  
Financial Management of Barangay’s New Appro Chairman 31 2.35 5
Government Accounting System and its provision. Secretary 4 1  
Total 110 2.35  
Punong Barangay 36 2.42  
Treasurer 39 2.41  
2. The barangay officials lack the capability of
Appro Chairman 31 2.35 3.5
accounting barangay funds.
Secretary 4 1.5  
Total 110 2.36  
Punong Barangay 36 2.53  
Treasurer 39 2.56
3. The implementation procedures are difficult,
Appro Chairman 31 2.45
tedious, and time-consuming. 1
Secretary 4 2
Total 110 2.5
Continuation of Table 29

Problems Encountered Position Frequency Mean Rank

Punong Barangay 36 2.58  

Treasurer 39 2.41  
4. There is a lack of training and orientation among
Appro Chairman 31 2.55 2
barangay officials.
Secretary 4 1  
Total 110 2.45  
Punong Barangay 36 2.53
5. Problems regarding the implementation of
Financial Management Practices of Barangay in Treasurer 39 2.41
accordance to New Government Accounting System Appro Chairman 31 2.29 3.5
are not immediately addressed by the barangay Secretary 4 1
officials.
Total 110 2.36
 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 106

The table depicts the difference between the responses of the barangay officials on

the problems encountered when grouped according to their positions in the Barangay.

Whether they are Punong barangay, Treasurer, Appropriation Chairman, or a Secretary,

all viewed that the implementation procedures are difficult, tedious, and time-consuming.

On the other hand, the problem encountered about the barangay officials, not aware of the

Financial Management of Barangay Manual New Government Accounting System and its

provision had the least impact.

However, both problems indicate that treasurers are those officials who had a hard

time in solving those problems. In contrast, the secretaries are least concerned in the

problems mentioned. This is presumably because treasurers have the primary

responsibility in regards to the financial matters of the Barangay.

Table 30

Problems Encountered According to Length of Experience in Government Service

Length of
Problems Encountered Frequency Mean Rank
Experience
Less than 1 year 2 4.00
1. The barangay officials are not 1-2 years 1 1.00
aware of the Financial
3-5 years 32 1.78
Management of Barangay’s New 5
More than 5
Government Accounting System 75 2.56
years
and its provision.
Total 110 2.35
2. The barangay officials lack the Less than 1 year 2 4.00
3.5
capability of accounting barangay 1-2 years 1 1.00
 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 107

3-5 years 32 1.94

More than 5
75 2.52
funds years
Total 110 2.36
Less than 1 year 2 3.50
1-2 years 1 1.00
3. The implementation procedures
3-5 years 32 2.22
are difficult, tedious, and time- 1
More than 5
consuming. 75 2.61
years
Total 110 2.50
Less than 1 year 2 2.00
1-2 years 1 1.00
4. There is a lack of training and
3-5 years 32 2.06
orientation among barangay 2
More than 5
officials. 75 2.65
years
Total 110 2.45
5. Problems regarding the Less than 1 year 2 4.00
implementation of Financial 1-2 years 1 1.00
Management Practices of 3-5 years 32 2.03
Barangay in accordance to New More than 5 3.5
Government Accounting System 75 2.48
years
are not immediately addressed by
the barangay officials. Total 110 2.36

The table above illustrates that there difference between the responses of the

barangay officials on the problems encountered when grouped according to the length of

service in the government service.

In consideration of the length of experience of barangay officials in the government

service, they all viewed that the implementation procedures are difficult, tedious, and time-

consuming. On the other hand, the problem encountered about the barangay officials, not

aware of the Financial Management of Barangay Manual New Government Accounting

System and its provision had the least impact.

Hence, respondents that are involved in government service for less than 1 year do

encounter much problems in the implementation of financial management according to

New Government Accounting System. This maybe because of the years they are involved
 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 108

in government service that they are still enhancing their knowledge and skills. In terms of

the relationship between leadership effectiveness of barangay captains along

communicating and their qualifications, the length of service is significant.

Chapter 5

SUMMARY OF FINDINGS, CONCLUSIONS, AND RECOMMENDATIONS

This chapter presents the summary of findings, the conclusions drawn from the study

and the researchers’ recommendations made based from the findings and conclusions.

This study aims to assess the level of implementation of financial management

practices of barangays in Sta. Mesa in accordance to New Government Accounting

System (NGAS).
 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 109

This study made use of the descriptive research method. The respondents of this

study are the barangay officials in all the barangays in Sta. Mesa specifically the punong

barangay, the barangay treasurer, and the chairman of appropriation along with the

barangay secretary. The researchers also made a data analysis on the variables that

affect the level of implementation of NGAS in the financial management practices of the

barangays. The data gathered by the researchers were analyzed and interpreted using

statistical tools such as frequency counts and percentage distributions to come up with

the profile of the barangay officials, Analysis of Variance (ANOVA) which helped in

making comparison of three or more means that enabled the researchers to draw various

results and predictions about three or more sets of data, Weighted Mean and Descriptive

Rating that determined the levels of the barangay officials/employees financial

management practices and t-Test.

Statement of the Problem

This study aims to assess the level of implementation of financial management

practices of barangays in Sta. Mesa in accordance to New Government Accounting

System (NGAS).

This study specifically seeks answers to the following questions:

1. What is the profile of the barangays’ respondents in terms of the following:

1.1 Profile of Individual Respondents

1.1.1 Age

1.1.2 Sex

1.1.3 Educational Attainment

 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 110

1.1.4 Present Position

1.1.5 Length of Experience in Government Service

1.2 Profile of Barangay where the individual respondent is residing

1.2.1 Barangay Appropriation/Budget or Internal Revenue Allotment

(IRA)

1.2.2 Number of Residents

2. What is the level of implementation of NGAS in the financial management

practices of barangay in terms of the following:

2.1 Fundamental Principles

2.2 Appropriations and Obligations

2.3 Collections and Deposits/Remittances

2.4 Disbursements

2.5 Supplies and Materials

2.6 Property, Plant and Equipment/Infrastructure Assets

3. Is there a significant difference in the respondents’ level of implementation of the

barangay's financial management practices according to NGAS when they are

grouped according to their profile?

4. What are the problems encountered by the respondents’ in the implementation of

NGAS on the financial management practices of the barangays?

5. Is there a significant difference on the problems that the respondents

encountered about the implementation of financial management practices of

barangays in Sta. Mesa, Manila when they are grouped according to their profile?

Summary of Findings
 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 111

With the use of the data analyzed, the following summary of findings were

established:

1. Profile of the Respondents

Out of 110 respondents, 65.5% were at the age bracket of 26-55 years old and

34.5% were at the age bracket of more than 55 years old. The male respondents

dominated the female respondents with a total percentage of 57.3%. The respondents who

attained college degree education got the highest total percentage of 77.3%, followed by

the 20.9% high school graduates, and the respondents with an elementary and master’s

degree education tied with a percentage of 9%. The most number of respondents are the

barangay treasurers with a percentage of 35.5%, next are the punong barangays with a

percentage of 32.7% followed by the appropriations officers with a percentage of 28.2%,

and the last 3.6% percent was composed by the barangay secretaries. With regards to the

length of experience in government service, the barangay officials with more than 5 years

of experience got 68.2%, while those with less than 5 years of experience got 31.8%.

In terms of the barangay budget, the barangays with IRA from the bracket of

1,000,000-4,000,000 totaled 55.5% while those having annual budget of more than

8,000,000 totaled 29.1%. Only 16.4% of the total respondents have IRA of over 4,000,001-

8,000,000. The barangays with a total number of 500-2000 residents resulted to 36.3%

while 34.5% of the total respondents have more than 5,000 residents. On the other hand,

29.2% of the total respondents have 2,001-4000 inhabitants.

2. What is the level of implementation of NGAS in the financial management practices

of the barangays in Sta. Mesa.

2.1 Fundamental Principles

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With the weighted mean of 4.67, the respondents perceived that the Fundamental

Principles specified in the NGAS were fully implemented. Moreover, the highest mean

rating of 4.87 was given to the practice indicating that the disbursements of barangay

funds or property always bear the approval of the barangay captain and treasurer. Also,

the practice specifying that all claims against barangay funds should be supported with

complete documentation ranked the second most implemented practice with a mean of

4.82. The provision indicating that barangay funds and monies should be spent solely for

public purposes got the third highest mean of 4.77.

On the contrary, the practice indicating that no barangay fund or properties are

applied for religious or private purposes, received the lowest mean of 4.36, followed by the

practice that the trust funds in the treasurer are paid out only for the purpose for which the

trust was created, received the second lowest mean score of 4.45. Lastly, the practice

indicating that no money is paid out of the barangay fund except in fulfillment of an

appropriations ordinance or law received the third lowest mean of 4.61.

2.2 Appropriations and Obligations

The financial management practices regarding appropriations and obligation showed

the weighted mean response of 4.61 which indicates full implementation of NGAS.

Moreover, the highest mean rating of 4.72 was given to the practice that the approved

barangay fund is recorded in the Records of the Appropriations and Obligations (RAO) and

is maintained by the Chairman of the Committee on Appropriations (CCA). While the last

item, stating that CCA of the barangay regularly updates the RAOs by posting all

obligations to determine available balance of the appropriations, received the lowest mean

of 4.48. Meanwhile, the practices that the expenditures of the barangay in no case
 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 113

exceeded available funds, received the second lowest mean of 4.54. Lastly, practices

wherein charges against the barangay funds shall be based on the obligations made,

received the third lowest mean of 4.65.

2.3 Collections and Deposits/Remittances

The financial management practices of collections and deposits/remittances resulted

to 4.39 weighted average mean which indicates that such practices were fully implemented

in accordance with the NGAS in barangays in Sta. Mesa. The provision that the barangay

should maintain only one depository bank account yields the highest mean of 4.54,

followed by collections are not used for payment of the barangay obligations having a

mean of 4.43. Checks in the name of barangay is accepted as payment of obligation to

barangay and issues the corresponding OR ranked third most fully implemented practice

with a 4.41 mean.

On the other hand, the barangay’s practice subjecting the official receipt to proper

custody, accountability and audit got the lowest mean of 4.23. Remitting the collections

received by the Barangay Treasurer (BT) intact to the city treasurer at least once a week or

as practicable during heavy collections ranked second lowest with a mean of 4.35. And

with a mean of 4.37 the recognition of all collections through the issuance of strictly

numbered Official Receipts (OR) ranked third lowest.

2.4 Disbursements

With a weighted mean response of 4.31, respondents perceived that practices

relating to disbursement were fully implemented in accordance to NGAS. Moreover, the

highest mean rating of 4.78 was given to the practice indicating that the liquidation
 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 114

documents are summarized in a Liquidation Report and supported with disbursement

documents. Additionally, disbursements of the barangay fund with duly certified and

approved disbursement documents got the second highest mean of 4.74. The third highest

mean of 4.68 was received by the practice wherein checks are used for disbursements.

In contrast, the practice wherein the Barangay Treasurer/Petty Cash Custodian is

tasked to hold a petty cash not above P10, 000, received the lowest mean of 3.73.

Barangay Treasurer/Petty Cash Custodian are authorized to make direct purchases not

above P1, 000 at any time for the essential needs of the barangay, received the second

lowest mean of 3.84. And lastly, the practice that the petty cash of the barangay is kept

separate from other funds, received the third lowest mean of 3.93.

2.5 Supplies

The weighted mean response of 4.35 regarding practices in relation to accounting of

supplies in barangays of Sta. Mesa indicated full implementation in accordance to NGAS.

In addition, the highest mean rating of 4.65 was given to the purchase of supplies and

materials of the barangay charged to MOOE and recorded using the appropriate expense

account. It is then followed by the statement that issuance and purchase of supplies and

materials of the barangay is covered or supported by an approved purchase request and

purchase order which received a mean of 4.49. While maintenance of stock card to

monitor and control disbursement and usage/consumption of supplies and materials of the

barangay showed the third lowest mean of 3.86. The supplies of the barangay with

serviceable life of more than one year are covered by inventory custodian slip received

4.35 mean which is the second to the lowest mean. And lastly, usage of supplies of
 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 115

barangay is supported by an approved requisition and issue slip, received the third lowest

mean of 4.37.

2.6 Plant, Property, and Equipment

All deliveries of property, plant and equipment are supported by Acceptance and

Inspection Report (AIR), reflected by a 4.66 mean, has the highest mean. Next to this is

the practice with the 4.61 mean which states that the barangay conducts a yearly physical

count of all supplies, property and equipment of the barangay.

On the other hand, the item with the lowest mean of 4.05 is the practice that

Property/Equipment Card is maintained for all property and equipment of the barangay.

Sending the property and equipment to its user is acknowledged by the Property

Acknowledgment Receipt and is renewed at least every three years or whenever there is a

change in custodianship, got the second lowest mean of 4.23. The practice that request

and purchases of property, plant and equipment are supported by an approved purchase

document has a mean of 4.56 which pertains to the middle mean of the results. The overall

mean is 4.42 indicating that the respondents fully implement the financial management in

their PPE.

2.7 Problems Encountered

Reflected by a 2.50 mean which is the highest, the main problem encountered by the

respondents was about the implementation procedures that are difficult, tedious, and time-

consuming. Moreover, the lack of training and orientation among barangay officials ranked

second highest having a 2.45 mean. And lastly, the barangay officials lack the capability of

accounting barangay funds, received the third highest mean of 2.36.

 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 116

3. Is there a significant difference in the respondents’ compliance of the barangay's

financial management practices according to NGAS when they are grouped

according to their profile?

The compliance of the barangay’s financial management practices according to

NGAS in terms of Fundamental Principles, Appropriations and Obligations, Collections and

Deposits/Remittances, Disbursements, Supplies and Materials, Property, Plant and

Equipment/Infrastructure Assets was not affected by the respondents’ age, sex,

educational attainment, position, years of experience and Internal Revenue Allotment

(IRA).

4. What are the problems encountered by the respondents’ compliance on the financial

management practices of the barangays?

One of the problems encountered by the respondents is that the barangay officials

are not aware of the Financial Management of Barangay Government Accounting Manual

and its provision. It also encompasses the problems of barangay officials lacking the

capability of accounting barangay funds. Another is that the implementation procedures

are difficult, tedious, and time-consuming. Aside from that, the lack of training and

orientation among barangay officials and the problems regarding the implementation of

Financial Management Practices of Barangay in accordance to New Government

Accounting System which are not immediately addressed by the barangay officials were

also perceived as problems.

 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 117

5. Is there a significant difference on the problems encountered by the respondents

about the level of implementation of financial management practices of barangays in

Sta. Mesa, Manila when they are grouped according to their profile?

The total p-value of the age of the respondents indicated that it does not affect the

compliance of financial management practices of barangays. The sex of the respondents

affects the compliance significantly with a total computed p-value of 0.0077. The

respondents’ educational attainment showed that it has no significant effect on the

compliance. The total computed p-value of the respondents’ position also does not affect

compliance of financial management practices of barangays in Sta. Mesa. The computed

p-value of the respondents’ years of experience resulted to 0.0274 which indicated that it

significantly affects the compliance. Lastly, the barangay’s IRA showed a p-value which

indicates that it has no significant effect on the compliance of financial management

practices of barangays in Sta. Mesa, Manila.

Conclusions

In light of the findings presented and under the condition in which the study was

conducted, the researchers arrived at the following conclusions:

1. Based on the respondents’ profiles, majority of the barangay officials are aged

between 26-55 years old, male, college degree holders and having the position

of treasurer with more than 5 years of experience in government service. In

terms of the barangays’ profiles, most of the barangays have annual budget/IRA

ranging from Php 1,000,001 to Php 4,000,000 with 500-2000 residents.

 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 118

2. The respondents’ viewpoints on the level of implementation of financial

management practices in their respective barangays according to NGAS

regarding its fundamental principles, appropriations and obligations, collections

and deposits/remittances, disbursements, supplies and materials, and property,

plant, and equipment are all fully implemented.

3. There is no significant difference between the respondents’ age, sex, educational

attainment, present position, and length of experience in government service on

how they perceive the level of implementation of the barangay’s financial

management according to NGAS. The respondents’ respective barangays also

have no significant difference between their IRA and number of residents with

their level of implementation of financial management.

4. The problems encountered by the barangays resulted on a verbal interpretation

of seldom serious. The viewpoint of the respondents in terms of the problems

encountered based on work experience which states that the implementation

procedures are difficult, tedious and time-consuming received the highest

weighted mean of 2.50.

5. There is no significant difference on the problems encountered by the

respondents about the implementation of the financial management practices of

barangays in Sta. Mesa, Manila when they are grouped according to their

present position and length of experience in government service, and barangays’

IRA and number of residents. When grouped according to sex and educational

attainment, there is a significant difference on the problems encountered by the

respondents.
 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 119

Recommendations

In light of the conclusions from the study, the following recommendations were

derived:

1. Strengthen the implementation that barangay funds should not be used for

religious purposes. Conduct a seminar for the officials and also the residents for

them to be updated about the barangay’s rules and policies with regard to its

financial management. Seminars give intensive exposure to a topic through

presentations and discussions led by multiple experts. .According to Learning

Development with Plymouth University, attending a seminar has numerous

benefits, including improving communication skills, gaining expert knowledge and

renewing motivation. With these, the constituents will be aware of the laws and

limitations of the barangay. Also, religious organizations will be aware that there is

no appropriated barangay funds for religious purposes. Lastly, by conducting

seminars, the whole barangay will be knowledgeable, aware and may develop

trust to its leaders.

2. The CCA of the barangay must regularly update the RAOs by posting all

obligations to determine available balance of the appropriations. Furthermore, the

barangay must conduct surprise inspection on the records of the appropriations

officer to avoid fraud.

3. Official receipts must be properly filed and must be inside of a safe locker to be

secured and organized to provide better access for accounting and auditing

purposes. Official receipts are necessary for completeness of records and as well

as availability and integrity of information.

 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 120

4. Establish a petty cash fund for the miscellaneous expenses of the barangays.

Some of the punong barangays opt to pay the small disbursements from their own

pockets then reimburse it. The barangay must have a separate fund for the abrupt

and miscellaneous expenditures that they spend. Petty cash funds are used to

handle small one-off purchases that can come up periodically in the course of

operations. They should be stored in a secure location with controlled access,

such as in a lock box. Petty cash management is the system of recordkeeping to

track the usage of petty cash funds.

5. Include the proper keeping of records and cards, especially the Stock Card and

Property/Equipment Card, for the accurate usage monitoring of supplies and

maintenance of properties as one of the basis of having the seal of good local

governance for barangays which rewards them cash incentives to be used for

their barangay’s development. The Department of the Interior and Local

Government (DILG) has launched the seal of good local governance for

barangays, which will allow them to obtain rewards. The department said in a

statement that the cash reward will be used to develop projects in their

barangays. The Seal will be awarded to Barangays that perform well in their

internal housekeeping, such as local legislation (paggawa ng batas), development

planning (pagplano para sa kaunlaran), resource allocation and utilization

(paglalaan at paggamit ng kaban ng bayan), service delivery (paghatid ng

serbisyo), community engagement (paghikayat sa komunidad) and human

resource management (pangangasiwa ng yamang tao). The seal aims to make

barangays accountable, transparent, participative and effective.

 POLYTECHNIC UNIVERSITY OF THE PHILIPPINES 121

6. Provide additional training for the officials regarding the proper financial

management implementation of their barangay. According to Sahu (2009) in his

book “Training for Development”, training impart skills and knowledge to

employees in order that they contribute to the organization’s efficiency and be

able to cope with the pressures of a constantly changing environment. Training

increases skills for doing a job in a better way by enhancing competencies.