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LOCAL TREASURY
OPERATIONS MANUAL
2nd EDITION
FISCAL ORGANIZATION
OF LOCAL GOVERNMENTS
AND THE LOCAL TREASURY OFFICE

LOCAL TREASURY
OPERATIONS MANUAL
2nd EDITION
DEPARTMENT OF FINANCE
BUREAU OF LOCAL GOVERNMENT FINANCE
Manila, Philippines

Local Treasury Operations Manual (LTOM), 2nd Edition
Second Printing, 2020.
Printed in the Philippines
Published by the Bureau of Local Government Finance
ISBN: 978-971-94098-8-5
Copyright© Bureau of Local Government Finance, 2019

Telefax: +632 522-8771 I 527-2803
Web: www.blgf.gov.ph
E-mail: [email protected]
All rights reserved.
No part of this book may be reproduced in any form or by any means without the express
permission of the copyright owner and the publisher.
Cover design and layout by: Jane Dianne S. Gaylican

ACKNOWLEDGMENT
This Local Treasury Operations Manual (LTOM), 2nd Edition, is a product of collaboration
of key stakeholders whose common goal is to improve the quality of local public financial
management, particularly the treasury operations of local government units.
The Technical Working Group, composed of BLGF Central and Regional Office Directors,
technical staff, and selected provincial, city and municipal treasurers, in various
consultation workshops and fora, helped bring about this new LTOM edition.
The BLGF acknowledges the Department of Finance, through the Secretary of Finance
and the Undersecretary for Revenue Operations, for the guidance and support in the
updating and publication of this LTOM.
The BLGF is likewise grateful for the support extended by the European Union’s Public
Financial Management 2 (EU PFM 2) Project, entitled “Support to the LGUs for More
Effective and Accountable Public Finance Management”, during the development phase
of this LTOM, and to the Asian Development Bank (ADB) during the consultations and
exposure workshops with key stakeholders and printing of the books.

Republic of the Philippines
Roxas Boulevard Corner Pablo Ocampo, Sr. Street
Manila 1004
MESSAGE
The Department of Finance (DOF) has made great strides in building revenues
and maintaining fiscal discipline in the Philippines. We paved the way toward increasing
national tax effort, foreign direct investments and, more importantly, maintaining high
growth over the past few years. These trends, in turn, ensured the roll out initiatives on
social services, as well as big- ticket infrastructure projects to address gaps in economic
development.
Our Bureau of Local Government Finance (BLGF) played and continues to play
a key and essential role to sustain all the gains we have achieved. Its strategies are
focused on implementing a three-pronged approach to modernize local finance: (i) policy
reforms and updating of regulations, (ii) improvements in systems and operations, and
(iii) high-impact capacity development.
This updated edition of the Local Treasury Operations Manual (LTOM) is indeed
one that will contribute to our goals of improving local finance as it incorporates updates
on relevant laws, policies, rules and regulations of the government. It seeks to address
competency gaps by providing local treasurers relevant information in key areas, such
as budgeting, accounting, auditing, supply management, real property assessment,
financing, custody and disbursement of funds, among others.
I believe this resource complements our strategy to professionalize the ranks of

local treasurers, which is key to a more transparent, independent and sustainable local
fiscal landscape. Equipping them with the right skills and ethical orientation to perform
their jobs well will likewise increase tax collection and revenue generation, and reduce
LGUs’ dependency on the internal revenue allotment.
I have high hopes that local treasurers will adopt the LTOM and take on a proactive
stance to further improve the efficiency of services provided by their respective LGUs.
Cutting red tape and ensuring a business-friendly environment will not only reduce the
stress and cost of tax-related processes, but also attract investments and ensure efficient
delivery of social services. I am confident that our cumulative and collaborative efforts will
enable us to achieve a long period of high and inclusive growth that leads to the economic
inclusion of all Filipinos.
Thank you.

Manila 1004
MESSAGE
Congratulations to the Bureau of Local Government Finance (BLGF) for the

publication of this Local Treasury Operations Manual (LTOM), 2nd Edition.
We, at the Department of Finance (DOF), recognize the achievements and

accomplishments of your office to not only modernize local finance, but also to maintain
excellence and integrity in local fiscal administration. Despite the challenges, the BLGF
continues to put in place long-term policies and initiatives that seek to transform local
government units (LGUs) into becoming more innovative and independent, able to
respond to the growing demands to sustain our country’s thriving economy.
The LTOM, thus, places clearer focus on the vital role played by local treasurers,
and the contributions they make to build and drive LGUs’ capacities to allocate their own
funds to where they are needed most. It reaffirms DOF’s policies on good fiscal governance
and LGU fiscal autonomy, which are both critical and strategic in the achievement of our
development goals.
Through this Manual, local treasurers can now acquire the necessary knowledge,
resource materials and technical know-how to boost collections, increase the tax base,
and reinforce prudence in expenditure management. Over the long-term, this will redound
to the benefit of the government and the general public as it allows LGUs to effectively
meet local needs and priorities. However, much more work remains to be done.
In this context, we count on local treasurers to diligently use the LTOM and be
more efficient, progressive-minded, honest, transparent, accountable, and risk-averse,
but willing to take daring and bold decisions, to ensure good fiscal governance.
Local treasurers should build on and expand the progress the government has
already made and help address the remaining challenges to bring about real change.
After all, only against this backdrop can we effectively help the country leapfrog towards
a more sustainable and inclusive development path.
ANTONETTE C. TIONKO
Undersecretary
Revenue Operations Group

8th Floor EDPC Building, BSP Complex, Roxas Boulevard, 1004 Manila
MESSAGE
Let me first congratulate the people behind the development and publication of
the Local Treasury Operations Manual (LTOM), 2nd Edition, for their tireless work and
invaluable dedication to update the basic reference for all local treasurers.
The Bureau of Local Government Finance (BLGF) remains committed to

undertake innovations and programs that continuously improve local finance to make it
viable and dynamic, and therefore help empower local governments as critical partners
in attaining our goal of sustainable and inclusive economic growth and development.
More than a decade since our first publication of the LTOM, much has changed
with the enactment of new laws, recent jurisprudence, and related rules and regulations
of oversight agencies that affect local treasury functions. As such, this LTOM, 2nd
Edition, provides a four-volume reference capturing the latest policy developments,
legal references, practical illustrations, organizational improvements, and standard
forms concerning local tax administration, revenue generation, tax information system
management, custody and disbursement of funds, expenditure management, election-
related responsibilities, internal controls and related fiduciary functions.
The issuance of this LTOM is very timely to support our vision to professionalize
the local treasury service under the Standardized Examination and Assessment for Local
Treasury Service Program of the Department of Finance and the BLGF, in partnership
with the Civil Service Commission. At the heart of this program lies the need to have a
reliable, updated, complete, and instructive resource to improve the knowledge, skills,
competencies and work-ethic in local treasury work and to be successful local fiscal
advisers and managers.
As local fiscal landscapes continuously evolve in pursuit of meaningful

decentralization, may this Manual be an effective instrument to help transform the quality
of local treasury work as an important dimension of a modern, responsive and inclusive
local public financial management system, on which the public can repose greater trust
and confidence.
NINO RAYMOND B. ALVINA

Executive Director

Manila 1004
DEPARTMENT ORDER NO.

085.20 1 9
Local Treasury Operations Manual (LTOM), 2nd Edition
1. LEGAL BASES. This Department Order is issued to promulgate the Local Treasury
Operations Manual (LTOM), 2nd Edition, pursuant to Article 456 of the Implementing Rules
and Regulations (IRR) of Republic Act (RA) No. 7160, otherwise known as the Local
Government Code (LGC) of 1991, and in line with the mandates of the Department of
Finance (DOF) to supervise the revenue operations of all local government units, under
Executive Order (EO) No. 292, s. 1987, and of the Bureau of local Government Finance
(BLGF) to exercise administrative and technical supervision, and coordination over treasury
and assessment operations of local governments, under EO No. 127, s. 1987.
2. COVERAGE. The LTOM, 2nd Edition, consists of four (4) books, which form integral parts
hereof, as follows:
Book I Fiscal Organization of Local Governments and the Local Treasury Office;
Book II Receipt and Collection of Income, Revenues and Other Fund Sources;
Book III Fund Management Practices, Expenditures and Disbursement; and
Book IV Detailed Procedures on the Administration and Collection of Real Property

Tax, Business Tax, Fees and Charges and Other Fund Sources.
3. LIMITATIONS. The provisions contained in the LTOM, 2nd Edition, are adoption of pertinent
provisions of relevant laws, jurisprudence, regulations, policies, issuances, opinions and
rulings affecting local finance and treasury operations. The applicable portions of related
provisions from various laws and issuances have been adopted into sections and/or
discussions of specific topics in the LTOM, and structured accordingly to cover the different
aspects of local treasury operations.
Users of the LTOM, 2nd Edition, are encouraged to further refer to the LGC and its IRR, the
Government Accounting and Auditing Manual, and the Manual on the New Government
Accounting System for LGUs, both of the Commission on Audit, the Budget Operations
Manual for LGUs of the Department of Budget and Management, cited jurisprudence, and
other pertinent issuances of DOF and BLGF on local finance and treasury operations.
4. SEPARABILITY CLAUSE. Any portion or provision of the LTOM, 2nd Edition, that may be
declared unconstitutional or invalid shall not have the effect of nullifying other portions and
provisions thereof as long, as such remaining portion or provision can still subsist and be
given effect in its entirety.
vi

5. REPEALING CLAUSE. This Order supersedes Department Order No. 10-08 dated 26
March 2008, and all Department issuances relative to the LTOM that are inconsistent
herewith. However, the LTOM, 2nd Edition, does not seek to supersede the issuances
and rulings of other oversight agencies, but only reiterates and amplifies their respective
applications in local treasury operations.
6. EFFECTIVITY. This Order shall take effect fifteen (15) days after its publication in the
Official Gazette and the University of the Philippines Office of the National Administrative
Register (ONAR) or in a newspaper of general circulation in the Philippines.
All BLGF Central and Regional Offices, and all local treasurers and assistant local
treasurers are hereby directed to properly, efficiently and strictly implement the LTOM, 2nd
Edition.
CARLOS G. DOMINGUEZ
0086BT
DEC 0 3 2019
Yii

OVERVIEW
LOCAL TREASURY OPERATIONS MANUAL
A. INTRODUCTION
This LTOM, 2nd Edition, is a compendium of the latest laws, policies, rules and
regulations of the government that affect the local finance and treasury operations
of local government units (LGUs). It is a vital reference material for local treasurers,
which is designed to be dynamic and responsive to the changing policy landscape
and evolving local public financial management that affect local treasury operations.
This publication was developed in consultation with local treasurers and key
stakeholders, after various dialogues, meetings, exposure workshop, focus group
discussions and management review, together with selected provincial, city and
municipal treasurers forming the Technical Working Group.
1. Title. This Manual shall be known as the Local Treasury Operations Manual
(LTOM), 2nd Edition, also herein referred to as the LTOM, 2nd Edition.
2. Background. Prior to this publication, the first edition of the LTOM was issued
by the Secretary of Finance under Department Order No.10-08, dated 26 March
2008, pursuant to Article 456 of the Implementing Rules and Regulations (IRR) of
the Local Government Code (LGC) of 1991. The LTOM has since been designed
to serve as a handy reference material for all provincial, city and municipal
treasurers in discharging their mandated functions. Since then, the LTOM has
been a regular reference of local treasury offices in their day-to-day operations.
B. RATIONALE
In recent years, the DOF, through the BLGF, perceived the need to update, improve
and enhance the first edition of the LTOM to be continuously relevant and attuned to
recent laws, jurisprudence, and policies, rules and regulations issued by oversight
agencies, and to be published in a user-friendly and easy to carry form.
Developments over the past decade concerning local finance render some provisions
of the first LTOM obsolete and irrelevant to local treasury offices, and there were
cases or complaints wherein local treasurers and other officials unknowingly follow
superseded provisions. Thus, this LTOM, 2nd Edition, adopted measures to address
these issues and concerns, and strategically changed the content groupings and
packaging into a four-volume manual to make it more functional for local treasurers
and other stakeholders.
1. Major Changes in Fiscal Organization since the LTOM was Issued. The LTOM
is guided by the LGC, which consolidated and adopted the various provisions
of different laws expanding the fiscal decentralization and autonomy of local
governments. These include Presidential Decree (PD) No. 231, as amended by
PD No. 426, PD No. 464 and PD No. 477, which sought to improve the fiscal
operations and organization of LGUs.
viii

LTOM, 2nd EDITION
However, there are laws amending certain provisions of the LGC, as well as
other laws providing for changes in the fiscal operations of LGUs, that have been
issued after 2008. All these pertinent laws and policies are included in this LTOM
and summarized in Annex 1 hereof.
2. Relationship of the LTOM to Existing Laws, Issuances and Pronouncements

of Other Fiscal and Regulatory Agencies. The LTOM, 2nd Edition, is primarily
based on the provisions of the LGC and its IRR, and relevant jurisprudence,
particularly those that apply to LGU financial operations and fiscal management.
This Manual also draws heavily from the Government Accounting and Auditing
Manual (GAAM) and the New Government Accounting System for LGUs (NGAS-
LGU) of the Commission on Audit (COA); the Budget Operations Manual (BOM)
of the Department of Budget and Management (DBM); opinions/ rulings and
issuances of the DOF and the BLGF; policies, regulations and opinions/rulings/
decisions of various bodies or agencies and authorities concerned with local fiscal
management and operations, such as DOF, COA, DBM, National Economic and
Development Authority (NEDA), and other authoritative expert references.
Consequently, this Manual provides discussions, illustrations, forms and

prescribed courses of action to supplement existing guidelines and regulations
of the DOF and the BLGF. This Manual, however, does not seek to supersede
issuances and rulings of other competent authorities, but rather aim to reiterate
and amplify their respective implementation.
C. OBJECTIVES OF THIS MANUAL

The objectives of this Manual are as follows:
1. To provide Local Treasurers with an updated reference material that will

guide them in discharging their duties and functions under the decentralized
framework and environment of the LGC;
2. To equip Local Treasurers with necessary information to develop their own

capabilities to respond to the demands of their roles within the LGU and fiscal
management structures;
3. To enable Local Treasurers to fully appreciate their powers, functions, and

authorities, and to relate these constructively with those of other officers
concerned with fiscal functions;
4. To raise awareness of Local Treasurers on the basic concepts and tools of

the non-traditional functions of LGUs that they may be involved in, whether as
principals or as advisers; and
5. To serve as a guide to Local Treasurers and other fiscal officers in the

management of the LGU’s financial affairs conforming to prescribed
good governance practices and internal control measures for improved
accountability and transparency.
ix

OVERVIEW
D. BRIEF DESCRIPTION OF THIS MANUAL

This publication consists of four (4) books forming integral parts of the LTOM, 2nd
Edition, which are printed and packaged individually for easy reference. Each book
contains important information and annexes, and is intended to be used as a stand
alone reference on local treasury operations.
Some provisions contained in the Manual are closely paraphrased, if not quoted
verbatim, from the relevant text of the laws, jurisprudence, regulations, policies,
issuances, opinions, rulings and decisions. Valid portions of various laws and
issuances were recast into a single provision, and parts of a single provision that
apply to the different aspects of treasury operations are reflected separately in the
appropriate topics.
The sources of particular sections or topics in this Manual are reflected in the text
itself, or set in parenthesis, to enable users to refer to the original provision if desired.
Likewise, the location of provisions alluded to in another chapter or section are
indicated in the respective portions.
For more detailed reading and information, users of this Manual are encouraged to
refer to the LGC and its IRR, the GAAM, the NGAS-LGU, the BOM and the myriad
of compilation of rulings, issuances and circulars of concerned oversight agencieis.

LTOM, 2nd EDITION
BOOK I
Fiscal Organization of Local Governments
and the Local Treasury Office

TABLE OF CONTENTS
TABLE OF CONTENTS
ACRONYMS xv
CHAPTER 1 1
FISCAL ORGANIZATION OF LOCAL GOVERNMENTS
Section 1. Legal Framework 1
Section 2. Creation, Division, Merger, Abolition 3
and Conversion of LGUs
Section 3. The Provincial/City/Municipal Treasury Office 7
Section 4. Organizational Structures:
Models for the Local Treasury Office 8
CHAPTER 2 18
THE LOCAL TREASURER
AND THE ASSISTANT LOCAL TREASURER
Section 5. Authority of the Secretary of Finance to Appoint Local 18
Treasurer and Assistant Local Treasurer
Section 6. Authority of the LCE over the Local Treasurer 19
and Assistant Local Treasurer
Section 7. Qualifications of Local Treasurer 20
Section 8. Processing of the Appointments of Provincial, City, 20
and Municipal Treasurers and Assistant Provincial, City,
and Municipal Treasurers
Section 9. Designation of Acting/Officer-ln-Charge (OIC)/ln-Charge 26
of Office (ICO) Provincial/City/Municipal Treasurers
and Assistant Treasurers
Section 10. Automatic Succession of the Assistant Provincial/City/ 32
Municipal Treasurer
Section 11. Designation in the Absence of an Assistant Local Treasurer 32
Section 12. Relief or Detail of Local Treasurers 32
and Assistant Local Treasurers
Section 13. Other Personnel Actions for Local Treasurers 35
Section 14. Preventive Suspension of Local Treasurers 43
Section 15. Attendance to Administrative, Civil or Criminal Investigation 46
of Local Treasurers and Assistant Local Treasurers
Section 16. Approval and Grant of Application for Leave of Absence 47
Section 17. Authority to Travel Abroad and Participate 50
in Training Programs
xii

LTOM, 2nd EDITION
CHAPTER 3 52
ADMINISTRATIVE AND TECHNICAL SUPERVISION
Section 18. Scope and Nature 52
A. Administrative and Technical Supervision by the BLGF 52
B. Technical Supervision by Provincial Treasurer 53
Over Municipal and Component City Treasurers
Section 19. Fiscal Performance Evaluation of LGUs and Local Treasurers 54
A. Conduct of Local Treasury Operations Evaluation 54
B. LGU Financial Sustainability Score Cards (LGUFSS) 54
C. Performance Standards for Local Treasurers 55
Section 20. Turn-Over of Accountabilities to the Incoming 56
and Out-going Local Treasurers
CHAPTER 4 60
ROLES, DUTIES, AND RESPONSIBILITIES
OF THE LOCAL TREASURER
Section 21. Powers and Duties of Local Treasurer 60
Section 22. The Local Treasurer’s Role in Boards and Committees 67
Created Pursuant to the LGC and Other Laws
Section 23. Treasurer’s Role in National and Local Elections 70
Pursuant to the Omnibus Election Code
CHAPTER 5 71
BONDING OF LOCAL TREASURERS
AND OTHER LGU ACCOUNTABLE OFFICERS
Section 24. Legal Basis for the Bonding of Local Treasurers 71
and Other LGU Accountable Officers
Section 25. Guidelines on Bonding of Local Treasurers 71
and Accountable Officers
Section 26. Schedule of Cash Accountability 73
and the Corresponding Bonds
Section 27. Renewal 74
Section 28. Increase in the Amount of Accountability 75
Section 29. Accountable Officers Considered Unsafe Risks 75
Section 30. Cancellation of Bond 76
Section 31. Effect of Cancellation 76
Section 32. The Fidelity Fund 76
Section 33. Extent of Liability 76
Section 34. Validity of Fidelity Bonds. 77
Section 35. Adjudication and Payment of Claims against the Fidelity Fund 77

TABLE OF CONTENTS
FORMS AND ANNEXES 80

Annex 1 List of Laws that Shaped Fiscal Decentralization 81
in the Philippines
Annex 2 DOF Department Order No. 031.2018 - Guidelines on the 119
Computation and Certification of Income for the Creation,
Conversion, Merger or Abolition of a Local Government Unit (LGU)
Annex 3 DOF Department Personnel Order No. 477-2019 124
- Guidelines on the Evaluation and Processing of Appointments
Annex 4 BLGF Memorandum Circular No. 025-2019 - Guidelines on the 131
Evaluation and Processing of Appointments of Local Treasurers
Annex 5 DOF Department Special Order No. 01-2018 - Updated Code 145
of Approving and Signing Authorities (CASA) of the Bureau
of Local Government Finance (BLGF)
Annex 6 BLGF Memorandum Circular No. 16-2015 - Local Public 149
Financial Management Tools for the Electronic Statement
of Receipts and Expenditures
Annex 7 DOF Department Order No. 075.2018 - Establishing the Local 151
Government Unit (LGU) Fiscal Sustainability Scorecard (FSS)
in the Bureau of Local Government Finance (BLGF)
Annex 8 DOF Department Order No. 006.2015 - Performance Standards 171
for Local Treasurers and Assistant Treasurers

LTOM, 2nd EDITION
ACRONYMS
AGDB Authorized Government Depository Bank
AOM Audit Observation Memorandum
ASPP Annual Supplies Procurement Plan
ATAP Authority to Accept Payment
BARMM Bangsamoro Autonomous Region in Muslim Mindanao
BAC Bids and Awards Committee
BIR Bureau of Internal Revenue
BLGF Bureau of Local Government Finance
BMBE Barangay Micro Business Enterprises
BTr Bureau of the Treasury
CESB Career Executive Service Board
COA Commission on Audit
COMELEC Commission on Elections
CRAAF Consolidated Report of Accountability for
Accountable Forms
CSC Civil Service Commission
CTOO Chief Treasury Operations Officer
DILG Department of Interior and Local Government
DBM Department of Budget and Management
DepEd Department of Education
DOF Department of Finance
DO/PO District/Provincial Office
DOST Department of Science and Technology
EU PFM 2 European Union’s Public Financial Management 2
eSRE electronic Statement of Receipts and Expenditures
GAAM Government Accounting and Auditing Manual
GAD Gender and Development Fund
GF General Fund
GOCC Government Owned and Controlled Corporation
GSIS Government Service Insurance System
HUC Highly Urbanized City
HoA Head of the Agency
ICO In-Charge of Office
IPCR Individual Performance Commitment and Review
IRA Internal Revenue Allotment
IRR Implementing Rules and Regulations
JMC Joint Memorandum Circular
LCE Local Chief Executive
LDRRMF Local Disaster Risk Reduction and Management Fund
LFC Local Finance Committee
LGC Local Government Code
LGU Local Government Unit
LMB Land Management Bureau
LTO Local Treasury Operations
MC Memorandum Circular
MMA Metro Manila Area
XV

ACRONYMS
MMDA Metro Manila Development Authority

MOOE Maintenance and Other Operating Expenses
MTO Municipal Treasurer’s Office
NAPOLCOM National Police Commission
NCR National Capital Region
NEDA National Economic and DevelopmentAuthority
NGAS New Government Accounting System
NSO National Statistics Office
OIC Officer-In-Charge
OPCR Office Performance Commitment and Review
PBL Public Bonding Law
PCW Philippine Commission on Women
PDS Personal Data Sheet
PNB Philippine National Bank
PPMP Project Procurement Management Plan
PRC Professional Regulation Commission
PS Personal Services
PSA Philippine Statistics Authority
PTO Provincial Treasurer’s Office
RAAF Report of Accountability for Accountable Forms
RATA Representation and Transportation Allowance
RCI Report of Checks Issued
RPT Real Property Tax
RRACCS Revised Rules on Administrative Cases in the Civil
Service
SALN Statement of Assets, Liabilities and Net Worth
SAM State Audit Manual
SC Supreme Court of the Philippines
SEAL Standardized Examination and Assessment for Local
Treasury Service Program
SEF Special Education Fund
SPL Special Privilege Leave
SPMS Strategic Performance Management System
SRE Statement of Receipts and Expenditures
sue State Universities and Colleges
TCT Transfer Certificates of Title
TDS Tax Declarations
TOP Treasurer of the Philippines
UBOM Updated Budget Operations Manual

LTOM, 2nd EDITION
INTRODUCTION
LTOM Book I describes the key features of the local government unit’s fiscal
organization and responsibilities, including the present requirements for the creation
of local governments, pursuant to existing laws.
Likewise, Book I discusses the policies and guidelines on the appointment and
designation of local treasurers and assistant local treasurers, their general and specific
roles, duties and responsibilities, as well as the scope and extent of administrative
and technical supervision over local treasury operations of LGUs.
LTOM Book I consists of five (5) Chapters, including Annexes, as follows:
Chapter 1 Fiscal Organization of Local Government Units (LGUs)
Chapter 2 The Local Treasurer and the Assistant Local Treasurer
Chapter 3 Administrative and Technical Supervision by the BLGF
Chapter 4 Roles, Duties and Responsibilities of the Local Treasurer
Chapter 5 Bonding of Local Treasurers and Other LGU Accountable Officers
xvii

FISCAL ORGANIZATION OF LOCAL GOVERNMENT
UNITS (LGUS)
SECTION 1. LEGAL FRAMEWORK

A. The State shall ensure the autonomy of local governments. (Article II, Sec. 4,
1987 Phil. Constitution)
B. The President of the Philippines shall exercise general supervision over local
governments. Provinces with respect to component cities and municipalities, and
cities and municipalities with respect to component barangays, shall ensure that
the acts of their component units are within the scope of their prescribed powers
and functions. (Article X, Sec. 4, 1987 Phil. Constitution)
Each LGU shall have the power to create its own sources of revenues and to
levy taxes, fees and charges subject to such guidelines and limitations as the
Congress may provide, consistent with the basic policy of local autonomy. Such
taxes, fees, and charges shall accrue exclusively to the local governments. (Article
X, Sec. 5, 1987 Phil. Constitution)
LGUs shall have a just share, as determined by law, in the national taxes which
shall be automatically released to them. (Article X, Sec. 6,1987 Phil. Constitution)
C. LGUs shall have the power and authority to establish an organization that shall
be responsible for the efficient and effective implementation of their development
plans, program objectives and priorities; to create their own sources of revenues
and to levy taxes, fees, and charges which shall accrue exclusively for their use
and disposition and which shall be retained by them; to have a just share in national
taxes which shall be automatically and directly released to them without need of any
further action; to have an equitable share in the proceeds from the utilization and
development of the national wealth and resources within their respective territorial
jurisdictions including sharing the same with the inhabitants by way of direct
benefits; to acquire, develop, lease, encumber, alienate, or otherwise dispose of
real or personal property held by them in their proprietary capacity and to apply
their resources and assets for productive, developmental, or welfare purposes,
in the exercise or furtherance of their governmental or proprietary powers and
functionsand thereby ensure their development into self-reliant communities and
active participants in the attainment of national goals. (Sec. 18, LGC)
D. Local governments shall be entitled to an equitable share in the proceeds of the

utilization and development of the national wealth within their respective areas,
in the manner provided by law, including sharing the same with the inhabitants by
way of direct benefits. (Art. X, Sec. 7,1987 Phil. Constitution) Every LGU created
or recognized underthe LGC is a body politic and corporate endowed with powers
to be exercised by it in conformity with law. As such, it shall exercise powers
as a political subdivision of the National Government and as a corporate entity
representing the inhabitants of its territory. (Sec. 15, LGC)
E. When a new LGU is created, its corporate existence shall commence upon the

LTOM, 2nd EDITION
election and qualification of its chief executive and a majority of the members of
its sanggunian, unless some other time is fixed therefor by the law or ordinance
creating it. (Sec.14, LGC)
F. Every LGU, as a corporation, shall have the following powers:
1. To have continuous succession in its corporate name;
2. To sue and be sued;
3. To have and use a corporate seal;
4. To acquire and convey real or personal property;
5. To enter into contracts; and
6. To exercise such other powers as are granted to corporations, subject to the

limitations provided in the LGC and other laws. [Sec. 22 (a), LGC]
G. LGUs shall enjoy full autonomy in the exercise of their proprietary functions and in
the management of their economic enterprises, subject to the limitations provided
in the LGC and other applicable laws. [Sec. 22 (d), LGC]
H. Every LGU shall exercise the powers expressly granted and those necessarily
implied therefrom, as well as powers necessary, appropriate, or incidental for its
efficient and effective governance, and those which are essential to the promotion
of the general welfare. Within their respective territorial jurisdictions, LGUs shall
ensure and support, among other things, the preservation and enrichment of
culture, promote health and safety, enhance the right of the people to a balanced
ecology, encourage and support the development of appropriate and self-reliant
scientific and technological capabilities, improve public morals, enhance economic
prosperity and social justice, promote full employment among their residents,
maintain peace and order, and preserve the comfort and convenience of their
inhabitants. (Sec. 16, LGC)
I. The financial affairs, transactions, and operations of LGUs shall be governed by

the following fundamental principles and policies, to wit:
1. No money shall be paid out of the local treasury except in pursuance of an

appropriations ordinance or law [Sec. 305 (a), LGC];
2. Local government funds and monies shall be spent solely for public purposes
[Sec. 305 (b), LGC];
3. Local revenue is generated only from sources expressly authorized by law or

ordinance, and collection thereof shall at all times be acknowledged properly
[Sec. 305 (c), LGC];
4. 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 [Sec. 305 (d), LGC]; and
5. Provinces, cities and municipalities shall maintain a General Fund which

shall be used to account for such monies and resources as may be received
2
FISCAL ORGANIZATION OF LOCAL GOVERNMENT UNITS (LGUS)
by and disbursed from the local treasury. The General Fund shall consist of
monies and resources of the local government which are available for the
payment of expenditures, obligations or purposes not specifically declared
by law as accruing and chargeable to, or payable from, any other fund. (Sec.
308, LGC)
SECTION 2. CREATION, DIVISION, MERGER, ABOLITION

AND CONVERSION OF LGUs
An LGU may be created, divided, merged, abolished, or its boundaries substantially
altered either by law enacted by Congress in the case of a province, city, municipality,
or any other political subdivision, or by ordinance passed by the sangguniang
panlalawigan or sangguniang panlungsod concerned in the case of a barangay
located within its territorial jurisdiction, subject to such limitations and requirements
prescribed in the LGC. (Sec. 6, LGC)
A. Common Requirements for Creation and Conversion of an LGU:
1. As a general rule, the creation of an LGU or its conversion from one level to
another level shall be based on three (3) verifiable indicators of viability and
projected capacity to provide services, to wit:
Indicators
It must be sufficient, based on acceptable standards, to provide for

all essential government facilities and services and special functions
Income
commensurate with the size of its population, as expected of the
LGU concerned.
It shall be determined on the total number of inhabitants within the
Population
territorial jurisdiction of the LGU concerned.
It must be contiguous, unless it comprises two or more islands
or is separated by a LGU independent of the others; properly
Land Area identified by metes and bounds with technical descriptions; and
sufficient to provide for such basic services and facilities to meet
the requirements of its populace.
2. Compliance with income, population and land area shall be attested to by

the DOF, the National Statistics Office (NSO), now known as the Philippine
Statistics Authority (PSA), and the Land Management Bureau (LMB),
respectively. (Sec. 7, LGC)
3. The creation of a province, city or municipality shall not reduce the land area,
population, and income of the original unit or units at the time of said creation
to less than the minimum requirements prescribed by law.
4. Also, no creation, division, merger, abolition, or substantial alteration of

boundaries of LGUs shall take effect unless approved by a majority of the
votes cast in a plebiscite called for the purpose in the political unit or units
directly affected. Said plebiscite shall be conducted by the Commission on

LTOM, 2nd EDITION
Elections (COMELEC) within one hundred twenty (120) days from the date
of effectivity of the law or ordinance effecting such action, unless said law or
ordinance fixes another date. (Sec. 10, LGC)
B. Requirements for the Creation of Local Governments - Local government

units may be created in accordance with the criteria provided for in the LGC,
summarized as follows:
Coverage/ Requisites for Creation Legal

LGU
Jurisdiction Income1 Population Land Area Basis
Province Cluster of Average annual A population A contiguous Sec.
municipalities, income, as certified of not less territory of at 461,
or by the DOF, of not 250,000 least 2,000 LGC
municipalities less than inhabitants sq. km.*2 as
and Php20,000,000.00 as certified certified by
component based on 1991 by the NSO, the LMB.
cities constant prices now known
(See Annex 2), as the PSA;
and either of the or
following requisites:
City34 Municipality Locally A population A contiguous RA
or a cluster of generated of not less territory of No.
barangays average 150,000 at least 100 9009
annual income, as inhabitants, sq. km. as
certified by the DOF, as certified certified by
of at least by the NSO, the
Php100,000,000.00 now known LMB.
for the last two as the PSA;
(2) consecutive or
years based on
2000 constant
prices (See
Annex 2), and if it
has either of the
following requisites:
7 The average annual income shall include the income accruing to the general fund, exclusive of special funds, trust funds, transfers
and non-recurring income.
2 The territory need not be contiguous if it comprises two (2) or more islands or is separated by a chartered city or cities which do
not contribute to the income of the province.
3 A city may either be Component or Highly Urbanized. Provided, however, that the criteria established in the LGC shall not affect
the classification and corporate status of existing cities. Independent component cities are those component cities whose charters
prohibit their voters from voting for provincial elective officials. Independent component cities shall be independent of the province.
(Sec. 451, LGC)
4 The territorial jurisdiction of a newly-created city shall be properly identified by metes and bounds. The requirement on land area
shall not apply where the city proposed to be created is composed of one (1) or more islands. The territory need not be contiguous
if it comprises two (2) or more islands.


LGU
Jurisdiction Income Population Land Area Basis
Municipality5 A group of Average A population Contiguous Sec.
barangays annual income,as of not less territory of 442,
certified by 25,000 at least 50 LGC
the provincial inhabitants, sq. km. as
treasurer, as certified certified by the
of at least by the NSO, LMB.6
Php2,500,000.00 now known as
for the last two the PSA; and
(2) consecutive
years based on
1991 constant
prices (See
Annex 2);
Barangay7 Out of a N/A A population N/A Sec.
contiguous of at least 2,000 386,
territory inhabitants as LGC
certified by
the NSO, now
known as
PSA, except
in cities and
municipalities
within Metro
Manila and other
metropolitan
political
subdivisions
or in HUCs
where such
territory shall
have a certified
population of
at least 5,000
inhabitants.
5 A municipality may be created, divided, merged, abolished, or its boundary substantially altered only by an Act
of Congress and subject to the approval by a majority of the votes cast in the plebiscite to be conducted by the
COMELEC in the LGU/s directly affected. Except as may otherwise be provided in the said Act, the plebiscite shall
be held within one hundred twenty (120) days from the date of its effectivity. (Sec. 441, LGC)
6 The territorial jurisdiction of a newly created municipality shall be properly identified by metes and bounds. The
requirement on land area shall not apply where the municipality proposed to be created is composed of one (1)
or more islands. The territory need not be contiguous if it comprises two (2) or more islands. (Sec. 442, LGC)
7 Creation of a Barangay
i. To enhance the delivery of the basic services in the indigenous cultural communities, barangays may be
created in such communities by an Act of Congress, notwithstanding the aforementioned requirement.
ii. The territorial jurisdiction of the new barangay shall be properly identified by metes and bounds or by more
or less permanent natural boundaries. The territory need not be contiguous if it comprises two (2) or more
islands.
iii. The governor or city mayor may prepare a consolidation plan for barangay, based on the foregoing criteria,
within his territorial jurisdiction. The plan shall be submitted to the sangguniang panlalawigan or sangguniang
panlungsod concerned for appropriate action.
iv. In the case of municipalities within the Metropolitan Manila area and other metropolitan political subdivisions,
the barangay consolidation plan shall be prepared and approved by the Sangguniang Bayan concerned. (Sec.
386, LGC)

LTOM, 2nd EDITION

LGU
Jurisdiction Income Population Land Area Basis
Highly Cities Latest annual Minimum population N/A Sec.
Urbanized income of at least of 200,000 452,
Cities Php50,000,000.00, inhabitants, LGC
(HUC)8 based on 1991 as certified by the
constant prices,as NSO, now known as
certified by the City the PSA.
Treasurer (See
Annex 2); and
C. Requirements for the Merger/Consolidation or Abolition of LGUs
1. Division and merger of existing LGUs shall comply with the same
requirements herein prescribed for their creation: provided, however, that
such division shall not reduce the income, population, or land area of the
LGU/s concerned to less than the minimum requirements prescribed in the
LGC: provided, further, that the income classification of the original LGU/s
shall not fall below its current classification prior to such division. (Sec. 8,
LGC)
2. An LGU may be abolished when its income, population, or land area has
been irreversibly reduced to less than the minimum standards prescribed for
its creation under Book III of the LGC, as certified by the national agencies
mentioned in Sec. 7 ofthe same, to Congress orto the sanggunian concerned,
as the case may be. The law or ordinance abolishing an LGU shall specify
the province, city, municipality, or barangay with which the LGU sought to be
abolished will be incorporated or merged. (Sec. 9, LGC)
D. Creation, Division, Merger or Alteration of Boundaries of Municipalities

or Barangays in the Bangsamoro Autonomous Region pursuant to RA
No. 11504 or An Act Providing for the Organic Law for the Bangsamoro
Autonomous Region in Muslim Mindanao (BARMM)
1. The Bangsamoro Autonomous Region is an integral, indivisible, and

inseparable part of the territory of the Republic of the Philippines. The
Bangsamoro people shall uphold the Constitution as the fundamental law of
the land and unequivocally owe allegiance and fidelity to the Republic ofthe
Philippines. (Art. IV, Sec. 1, RA No. 11504)
8 Highly Urbanized Cities (HUC):
/'. Cities which do not meet the above requirements shall be considered component cities of the province In
which they are geographically located. If a component city is located within the boundaries of two (2) or more
provinces, such city shall be considered a component of the province of which it used to be a municipality.
Qualified voters of highly urbanized cities shall remain excluded from voting for elective provincial officials.
[Sec. 452 (b)(c), LGC]
ii. Unless otherwise provided in the Constitution or the LGC, qualified voters of independent component cities
shall be governed by their respective charters, as amended, on the participation of voters in provincial
elections. Qualified voters of cities who acquired the right to vote for elective provincial officials prior to the
classification of said cities as highly urbanized after the ratification ofthe Constitution and before the effectivity
ofthe LGC, shall continue to exercise such right. (Sec. 452, LGC)
Hi. It shall be the duty of the President to declare a city as highly urbanized after it shall have met the minimum
requirements prescribed, upon proper application therefor and ratification in a plebiscite by the qualified voters
therein. (Sec. 453, LGC)

2. In the exercise of its right to self-governance, the Bangsamoro Autonomous

Region is free to pursue its political, economic, social and cultural development
as provided for in the Organic Law. (Art. IV, Sec. 2, RA No. 11504)
3. The authority of the Bangsamoro Government to regulate the affairs of its

constituent local government units shall be guaranteed in accordance with
the Organic Law and a Bangsamoro local government code to be enacted
by the Parliament. The privileges already enjoyed by local government units
under Republic Act No. 7160, otherwise known as the “Local Government
Code of 1991,” as amended, and other existing laws shall not be diminished.
The Parliament may create, divide, merge, abolish, or substantially alter

boundaries of municipalities or barangays in accordance with a law enacted
by the Parliament. The municipalities or barangays created, divided,
merged, or whose boundaries are substantially altered, shall be entitled to
their appropriate share in the national taxes or Internal Revenue Allotment:
Provided, That the criteria laid down in Republic Act No. 7160, as amended,
and other national laws shall be satisfied: Provided, further, That it shall be
approved by a majority of the votes cast in a plebiscite in the political units
directly affected.
When such acts require the creation of a legislative district, the Bangsamoro
Government shall cooperate and coordinate with the National Government
through the Philippine Congress-Bangsamoro Parliament Forum to prioritize
the deliberations on the creation of a legislative district.
Nothing in the Organic Law shall be construed to allow the Bangsamoro

Government to create legislative districts.
(Art. VI, Sec. 10, RA No. 11504)
4. The powers of government shall be vested in the Parliament which shall

exercise those powers and functions expressly granted to it by the Organic
Law, and those necessary for, or incidental to, the proper governance and
development of the Bangsamoro Autonomous Region. (Art. VII, Sec. 2, RA
No. 11504)
SECTION 3. THE PROVINCIAL/CITY/MUNICIPAL TREASURY OFFICE

A. Pursuant to the provisions of the LGC, there shall be a municipal, city and
provincial treasurer, as among the officials mandated to respectively govern each
of the municipal, city and provincial governments. [Sec. 443(a), 454(a), 463(a),
LGC]
B. Pursuant to Sec. 470 (d) of the LGC, the treasurer shall take charge of the treasury
office, perform the duties provided for under Book II of the LGC, among other
powers and duties mentioned in Chapter 4 of this manual.
C. The provisions under Book II of the LGC shall govern the exercise by provinces,
cities, municipalities, and barangays of their taxing and other revenue-raising
powers. (Sec. 128 to 383, LGC)

LTOM, 2nd EDITION
SECTION 4. ORGANIZATIONAL STRUCTURES:

MODELS FOR THE LOCAL TREASURY OFFICE
A. The Local Treasury Office, as the core administrator of LGU funds and finances,
shall adopt appropriate and responsive organizational structure that takes into
consideration the major divisions or functional units of the office that respond to
the goals of the LGU and for the provision of efficient and quality services to its
constituency and key stakeholders.
Models of efficient and desirable organizational setup and structure of Provincial

Treasury Office (PTO), City Treasury Office (CTO) and Municipal Treasury Office
(MTO), according to specific considerations, are presented below.
B. The Local Treasury Office is also encouraged to create an Information Technology

(IT) Unit or IT plantilia positions to perform the following functions:
1. Handle the security and maintenance of digitized real property tax records
of the local treasury office and assist in the posting of related tax information
campaign materials;
2. Handle the maintenance and updating of systems applications and

information technology requirements of the local treasury office and provide
recommendations;
3. Prepare and submit reports as may be required by the BLGF;
4. Provide troubleshooting services in the local treasury office; and
5. Perform other related functions that may be assigned.
C. For the PTO, the following basic functional units/divisions are directly under the
Provincial Treasurer and may be assisted by an Assistant Provincial Treasurer,
or two Assistant Provincial Treasuers (one for Operations, and the other for
Administration). The Local Treasurers of component municipalities and cities are
under the technical supervision of the PTO. The functions of the divisions under
the PTO are provided below:
1. Administrative Division
a. Ensure that all national and local circulars, memoranda and guidelines
concerning local treasury operations are received, disseminated and
acted upon/complied with;
b. Maintain records of all communications and documents pertaining to

local treasury operations;
c. Prepare Office Performance Commitment and Review (OPCR) and

ensure submission of the Individual Performance Commitment and
Review (IPCR) of personnel, compliant to the approved Strategic
Performance Management System (SPMS) of the LGU;

d. Maintain records of all pertinent information of PTO personnel (i.e.,

PDS, SALN, Leave Credits);
e. Ensure the observance of R A No. 6713 or the “Code of Conduct and

Ethical Standards for Public Officials and Employees,” and recommend
disciplinary action when appropriate;
f. Ensure that all accountable officers are properly bonded pursuant to

the provisions of the Public Bonding Law (PBL);
g. Draft reply/memo circulars pertaining to treasury matters;
h. Conduct annual physical inventory of the following: unused accountable

forms; office supplies; property, plant and equipment; Transfer
Certificates of Title (TCTs)/Tax Declarations (TDs) of government-
owned properties and pertinent documents to support ownership; and
ensure that all buildings, property and equipment are insured annually;
i. Prepare monthly report of accountable forms;
j. Prepare and submit reports as may be required by the BLGF;
k. Perform other duties and functions that may be assigned.
2. Treasury Operations and Review Division
a. Assist in the conduct of public auction of delinquent real properties;
b. Recommend strategies and revenue measures to increase collection;
c. Assist the Provincial Treasurer in preparing proposed revenue

ordinances;
d. Prepare reports regarding collections on a regular basis;
e. Prepare the annual estimated revenue of the province before July 15th
of each year;
f. Prepare Budget Proposals of the PTO, including the Project

Procurement Management Plan (PPMP), Annual Supplies Procurement
Plan (ASPP), and other related reports;
g. Prepare and submit reports as may be required by the BLGF; and
h. Perform other duties and functions that may be assigned.
3. Cash Division
a. Disburse obligations, such as salaries and wages, allowances and

honorarium;
b. Prepare checks for disbursement of various obligations of the Province;

LTOM, 2nd EDITION
c. Receive daily collections including payments on real property tax paid

by property owners, to the provincial treasurer of the province to which
the municipality where the subject property is located;
d. Prepare daily consolidated report of collections and deposits and

attach the list of checks for deposit;
e. Deposit daily to authorized government depository banks (AGDBs) all

collections received from collectors or remitted by different collecting
offices;
f. Remit national and municipal shares;
g. Prepare daily report of checks issued (RCI);
h. Update cash books daily and prepare daily Cash Position Report;
i. Prepare daily, weekly or monthly report of collections;
j. Prepare and submit electronic Statement of Receipts and Expenditures

(eSRE) quarterly reports and other reports required by the BLGF;
k. Consolidate the eSRE quarterly reports of its component municipalities;

and
I. Perform other duties and functions that may be assigned.
4. Local Economic Enterprise Division. As may be necessary; refer to

functions of this division under the CTO.
Figure 1. Organizational Structure of the Provincial Treasury Office
PROVINCIAL TREASURER
Assistant Provincial Assistant Provincial

Treasurer Treasurer
(Operations) (Administration)
Local Economic
Administrative Treasury Operations Cash
Enterprise
Division and Review Division Division
Division
10

D. The City Treasury Office (CTO), on the other hand, is viewed to be more complex
in structure than that of the PTO. It has at least five major functional divisions,
each of which may be divided into sections; provided, that it is in accordance with
DBM and CSC rules and regulations.
All the functional divisions of the CTO are directly under the supervision of the
City Treasurer and may be assisted by one or two Assistant City Treasurers. The
functions of the divisions under the PTO are provided below:
1. Administrative Division
pertaining to treasury operations are received, disseminated and acted
upon/complied with;
b. Maintain records of all communications and documents pertaining to

treasury operations;
c. Prepare OPCR and ensure submission of the IPCR of personnel,

compliant to the approved SPMS of the LGU;
d. Maintain records of all pertinent information of CTO personnel (i.e.

e. Ensure the observance of RA No. 6713 or the “Code of Conduct and

disciplinary action, when appropriate;

the provisions of the PBL;

forms; office supplies; property, plant and equipment; TCTs/TDs of
government-owned properties and pertinent documents to support
ownership; and ensure that all buildings, property and equipment are
insured annually;
i. Prepare Budget Proposals of the CTO, including the PPMP, ASPP and
other related reports;
j. Prepare Estimated Revenue for submission before July 15th of each

year;
k. Issue accountable forms to accountable officers and prepare monthly

reports pertaining thereto;
I. Prepare and submit reports as may be required by the BLGF; and
m. Perform other duties and functions that may be assigned.
11

LTOM, 2nd EDITION
2. Cash Division. For clearer delineation of functions of personnel in the Cash

Division, it may be subdivided into two sections: (i) Cash Receipts Section,
and (ii) Cash Disbursement Section.
a. Receive daily collections from all collection officers of the LGU;
b. Prepare the daily consolidated report of collections and deposits and

c. Deposit daily cash and check collections to AGDBs;
d. Prepare daily, weekly and monthly report of collections;
e. Update cash books and prepare daily cash position report;
f. Prepare monthly report of used and unused accountable forms;
g. Disburse salaries and wages, allowances and honorarium of

employees;
h. Prepare checks in payment of various obligations of the city;
i. Remit national government and barangay shares;
j. Prepare daily RCI;
k. Prepare and submit quarterly eSRE reports, and other reports required
by the BLGF; and
3. Real Property Tax Division
a. Compute and collect payments on real property tax and issue

Certificate of payments/tax clearance upon request;
b. Update records of real property tax payments and prepare list of

delinquent properties for posting and publication;
c. Send notices of delinquency to delinquent real property owners;
d. Assist in the conduct of public auction of delinquent real properties;
e. Ensure that cash books of collectors are updated daily;
f. Prepare monthly report of barangay share;
g. Prepare monthly/quarterly report of real property tax collection;
h. Recommend strategies to increase real property tax collection;
i. Prepare and submit reports as may be required by the BLGF; and
j. Perform other duties and functions that may be assigned.
12

4. Business Tax and Miscellaneous Revenue Division
a. Evaluate gross receipts of business establishments and assess the

corresponding local business taxes, fees and charges, and other duly
authorized local impositions;
b. Collect and record payments on business taxes, fees and charges,

and other taxes;
c. Issue certificate of payment upon request;
d. Prepare notice of delinquency on local business tax;
e. Inspect business establishments within the jurisdiction of the city,

relative to the implementation of approved tax ordinances, pursuant to
the provisions of the LGC;
f. Calibrate and seal all weights and measures used within the LGU
jurisdiction;
g. Receive, inspect and assess applications of retirement of business;
h. Ensure that cash books of collectors are updated daily;
i. Recommend strategies to increase collection of local business tax;
j. Prepare and submit reports as may be required by the BLGF; and
k. Perform other duties and functions that may be assigned.
5. Treasury Operations and Review Division
a. Assist in the conduct of public auction of delinquent real properties;
b. Prepare reports regarding collections on a regular basis;
c. Recommend strategies and revenue measures to increase collection;
d. Prepare the annual estimated revenue of the city before July 15th of
each year;
e. Prepare Budget Proposals of the CTO, including the PPMP, ASPP and
other related reports;
f. Conduct Examination of Books of Accounts on Business

Establishments;
g. Evaluate request on re-assessment and tax credit;
h. Assist the City Treasurer in preparing proposed revenue ordinances;
i. Prepare and submit reports as may be required by the BLGF; and
j. Perform other duties and functions that may be assigned.
13

LTOM, 2nd EDITION
6. Local Economic Enterprise Division
a. Advise the LCE and the sanggunian, regarding the establishment

of local economic enterprises, if the same is warranted, marketable,
viable and self-liquidating;
b. Ensure that setting up and operation of the local economic enterprises

shall be included in the development planning and investment
programming;
c. Ensure that funding requirement for the creation of local economic

enterprise is included in the annual budget of the LGU;
d. Advise the LCE and sanggunian in the enactment of ordinances

on local economic enterprises, which should be aligned to the LGU
development goals and objectives and ensure that the same shall
operate under the basic principle of financial self-sufficiency via cost
recovery;
e. Advise the LCE and sanggunian regarding the efficiency and

effectiveness of its service delivery, that the same is responsive to the
needs of the constituency and does not compete with the goods and
services provided by the private sector; and
f. Advise the LCE of delinquencies incurred by the local economic

enterprise clients/lessees for the purpose of taking the necessary
remedial measures and enforcing sanctions, if applicable.
Figure 2. Organizational Structure of the City Treasury Office
CITY TREASURER
Assistant City Treasurer Assistant City Treasurer

(Operations) (Administration)
Real Business Treasury Local

Adminis-
f11raf Cash Property Tax and Operations Economic
alli\/o
Vc
Division Tax Miscellaneous and Review Enterprise
Division
Division Revenue Division Division Division
14

E. For the Municipal Treasury Office (MTO), the organizational structure is simpler,
with only two (2) functional divisions, i.e., the Cash Division, and the Revenue
Division, whose functions are similar to that of the CTO’s, together with
Administrative Section to provide administrative support to the operations of the
office.
1. Administrative Section
regarding treasury operations are received, disseminated and acted
upon/complied with;
b. Maintain records of all communications and pertinent documents on

local treasury operations;
c. Prepare OPCR and ensure submission of the IPCR of personnel,

compliant with the approved SPMS of the LGU;
d. Maintain records of pertinent information of all MTO personnel (i.e.

e. Ensure the observance of RA No. 6713 or the “Code of Conduct and

disciplinary action when appropriate;

the provisions of the PBL;

forms; office supplies; property, plant and equipment; TCTs/TDs of
government-owned properties and pertinent documents to support
ownership; and ensure that all buildings, property and equipment are
insured annually;
i. Prepare Budget Proposals of the MTO, including the Procurement

Management Plan, Annual Supplies Procurement Plan and other
related reports;
j. Prepare the Estimated Revenue for submission before July 15th of

each year;
k. Issue accountable forms to accountable officers;
I. Prepare monthly report of accountable forms;
m. Prepare and submit reports as may be required by the BLGF; and
n. Perform other duties and functions that may be assigned.
15

LTOM, 2nd EDITION
2. Cash Division
a. Receive daily collections from all collection officers of the LGU;
b. Prepare the daily consolidated report of collections and deposits and

c. Deposit daily collections of the municipality to AGDBs;
d. Prepare daily, weekly and monthly report of collections;
e. Update Cash Books and prepare daily cash position report;
f. Assist the Municipal Treasurer in handling the disbursement of local

government funds and such other funds entrusted by law or other
competent authority;
g. Disburse salaries and wages, allowances and honorarium of

employees;
h. Prepare checks in payment of various obligations of the municipality;
i. Remit national and barangay shares;
j. Prepare daily RCI;
k. Prepare and submit quarterly eSRE reports required by the BLGF; and
3. Revenue Division
a. Compute and collect payments on Real Property Tax (RPT);
b. Prepare monthly/quarterly report of RPT collection;
c. Update records of RPT payment and prepare list of delinquent

properties;
d. Send notices of delinquency to delinquent real property owners;
e. Prepare notices of delinquency on RPT for posting and publication;
f. Prepare monthly report of barangay share;
g. Evaluate gross receipts of business establishments and assess local

business taxes, fees and charges, and other duly authorized local
impositions;
h. Collect and record payments on business taxes, fees and charges, and
other taxes;
i. Prepare notice of delinquency on local business tax;
16

j. Inspect business establishments within the jurisdiction of the

municipality relative to the implementation of approved tax ordinances
pursuant to the provisions of the LGC;
k. Receive, inspectand assess applications for retirement of business;
I. Calibrate and seal all weights and measures within the jurisdiction of
the LGU;
m. Issue Certificate of payments/tax clearance, upon request;
n. Ensure that cash books of collectors are updated daily;
o. Recommend strategies to increase collection on RPT, business tax

and other revenues;
p. Prepare and submit reports as may be required by the BLGF; and
q. Perform other duties and functions that may be assigned.
Figure 3. Organizational Structure of the Municipal Treasury Office
MUNICIPAL TREASURER
Assistant Municipal Treasurer
Administrative Section
Cash Division Revenue Division
Note: Administrative functions may be more of records management, supply management,

bonding requirements, performance management and similar administrative support functions.
HR functions may be limited to attendance monitoring, travel order and training, monitoring
of personnel action, but maintenance of personnel records must still be lodged with the HR
office or department of the LGU.
17

THE LOCAL TREASURER
AND THE ASSISTANT LOCAL TREASURER
SECTION 5. AUTHORITY OF THE SECRETARY OF FINANCE

TO APPOINT LOCAL TREASURER AND ASSISTANT
LOCAL TREASURER
A. The appointment of a Treasurer shall be mandatory for Provincial, City and

Municipal Governments [Sec. 470 (c), LGC], while the appointment of an Assistant
Local Treasurer shall be optional [Sec. 471(b), LGC].
B. The Treasurer shall be appointed by the Secretary of Finance from a list of at least
three (3) ranking eligible recommendees of the Governor or Mayor, as the case
may be, subject to civil service law, rules and regulations. [Sec. 470 (a), LGC]
C. Nepotic Appointment
1. No person shall be appointed in the career service of the local government

if he/she is related within the fourth civil degree of consanguinity or affinity to
the appointing or recommending authority. (Sec. 79, Title III, LGC)
2. All appointments in the national, provincial, city and municipal governments

or in any branch or instrumentality thereof, including government owned
or controlled corporations, made in favor of a relative of the appointing or
recommending authority or of the chief of the bureau or office or of persons
exercising immediate supervision over him, are hereby prohibited.
The word “relative” and members of the family referred to are those related
within the third degree either of consanguinity or of affinity.
(Sec. 59. Chapter VIII, Book V, Administrative Code of 1987)
3. The rule on Nepotic appointment under Sec. 79, Title III of the LGC applies to
local treasurers and assistant treasurers in LGUs and not that under Sec. 59,
Chapter VIII, Book V of the Administrative Code of 1987. (CSC Resolution
No. 1000170 dated 06 October 2010 as affirmed by CA Decision dated 07
November, 2013 in CA G. R. S. R No. 121404)
18

THE LOCAL TREASURER AND THE ASSISTANT LOCAL TREASURER
SECTION 6. AUTHORITY OF THE LCE OVER THE LOCAL TREASURER

AND ASSISTANT LOCAL TREASURER
The Treasurer shall be under the administrative supervision of the Governor or Mayor,
as the case may be, to whom he/she shall report regularly on the tax collection efforts
in the LGUs. [Sec. 470 (b), LGC]
The administrative supervision by the Local Chief Executive (LCE) over local
treasurers shall be executed in close coordination with the Secretary of Finance being
the appointing authority of treasurers. For this purpose, the treasurer shall be guided
by the definition of administrative supervision as provided under Sec. 38(2), Chapter
7, Book IV of Executive Order 292 or the Administrative Code of 1987.
“Administrative Supervision. - (a) Administrative supervision which

shall govern the administrative relationship between a department or
its equivalent and regulatory agencies or other agencies as may be
provided by law, shall be limited to the authority of the department or its
equivalent to generally oversee the operations of such agencies and to
insure that they are managed effectively, efficiently and economically
but without interference with day-to- day activities; or require the
submission of reports and cause the conduct of management audit,
performance evaluation and inspection to determine compliance with
policies, standards and guidelines of the department; to take such
action as may be necessary for the proper performance of official
functions, including rectification of violations, abuses and other forms
of maladministration; and to review and pass upon budget proposals
of such agencies but may not increase or add to them;
(b) Such authority shall not, however, extend to: (1) appointments
and other personnel actions in accordance with the decentralization
of personnel functions under the Code, except when appeal is made
from an action of the appointing authority, in which case the appeal
shall be initially sent to the department or its equivalent, subject
to appeal in accordance with law; (2) contracts entered into by the
agency in the pursuit of its objectives, the review of which and other
procedures related thereto shall be governed by appropriate laws,
rules and regulations; and (3) the power to review, reverse, revise,
or modify the decisions of regulatory agencies in the exercise of their
regulatory or quasi-judicial functions; and
(c) Unless a different meaning is explicitly provided in the specific

law governing the relationship of particular agencies, the word
“supervision” shall encompass administrative supervision as defined
in this paragraph.”
The DOF shall maintain its focal role as the overseer of the operations of local treasury
offices, both in administrative and technical aspects.
19

LTOM, 2nd EDITION
SECTION 7. QUALIFICATIONS OF A LOCAL TREASURER

A. No person shall be appointed Treasurer unless, he/she possesses the following
qualifications:
1. A citizen of the Philippines;

A person with dual citizenship shall not be appointed in government unless
he/she renounces his/her foreign citizenship pursuant to the provision of RA
9225. (CSC Memorandum Circular No. 23, series of 2016)
2. A resident of the LGU concerned;

One is a resident of a place from which his departure is indefinite as to
time, definite as to purpose; and for this purpose he has made the place
his temporary home. (Uytengsu vs. Republic of the Philippines, GR No.
L-6379)
3. Of good moral character;
4. A holder of a college degree preferably in commerce, public administration

or law from a recognized college or university;
5. A first grade civil service eligible or its equivalent; and
6. Must have acquired experience in treasury or accounting service for at least

five (5) years in the case of the City or Provincial Treasurer, and three (3)
years in the case of Municipal Treasurer. [Sec. 470 (c) and 471(b), LGC]
B. The Secretary of Finance, in the exercise of his/her appointing power, may institute
additional competency indicators as criteria in the selection process, subject to
civil service rules and regulations.
SECTION 8. PROCESSING OF THE APPOINTMENTS OF PROVINCIAL,

CITY, AND MUNICIPAL TREASURERS AND ASSISTANT
PROVINCIAL, CITY, AND MUNICIPAL TREASURERS
Pursuant to Department Personnel Order (DPO) No. 477.2019 dated 04 June 2019,
and its implementing guidelines, the appointments of the Provincial, City, or Municipal
Treasurers or Assistant Treasurers shall be processed as follows:
A. Criteria for Evaluation. In evaluating all the recommendees of the LCE, the
following qualifications and attributes shall be weighted:
1. Education: College degree, preferably in commerce, public administration

or law, from a recognized college or university;
2. Experience in treasury or accounting service: Provincial and City Treasurers

and Assistant Provincial and City Treasurers: At least five (5) years; Municipal
Treasurers or Assistant Municipal Treasurers: At least three (3) years;
20

3. Performance: At least ‘Very Satisfactory’ rating in the last rating period prior
to the assessment or screening;
4. Relevant Training: Completion of trainings, scholarships, and other capacity

building interventions relevant to the duties and functions of the position
undertaken within the last five (5) years reckoned from the date of LCE
recommendation; and
5. Other Related Criteria and Attributes: To further establish competency and

fitness, additional criteria and attributes shall be evaluated and weighted,
namely: (i) Salary Grade/Rank; (ii) Previous Designation in the Local
Treasury Service; (iii) Post-graduate Degree/s; (iv) Bar and/or Professional
License; (v) SEAL certification; and (vi) Interview by the BLGF.
The weights for SEAL certification shall be as follows: 10% for BCLTE, 15%
for ICLTE, and 20% for ACLTE.
The table of criteria and the respective weight allocations is attached as

Annex 3 [Department Personnel Order (DPO) 477.2019].
All mandatory requirements required under the LGC and CSC rules that have no point
allocation or determined on a pass-fail basis, such as citizenship, residency, good
moral character, eligibility, and non-nepotic relationship, together with the applicable
clearances and certifications, shall be fully evaluated by the BLGF.
B. Appointment Requirements and Procedures
1. Publication and Posting of Vacancy. Per Item Nos. 3.2 and 3.3 of DPO
No. 477.2019, the publication and posting of the vacant position of Local
Treasurer (LT) or Assistant Local Treasurer (ALT), in accordance with RA
No. 7041, as amended, for at least fifteen (15) calendar days, shall first be
complied with. The filling up of the vacant position shall be made after fifteen
(15) calendar days from its publication, but shall not exceed nine (9) months
from the date of publication. Such notice of vacancy shall strictly contain the
qualification standards, as provided under Secs. 470 and 471 of Republic
Act (RA) No. 7160 or the Local Government Code (LGC) of 1991, and shall
be posted in at least three (3) conspicuous places within the concerned LGU,
and shall be reported to the Civil Service Commission (CSC).
2. Prescribed Documentary Requirements. The basic documentary

requirements for processing the appointments of LT and ALT are as follows:
First Level Basic Documentary Requirements

for Appointment of Local Treasurers and Assistant Local Treasurers
Document Remarks
A. Requirements from the Individual Recommendees
1. Personal Data Sheet (PDS) - CSC Form No. 212, with the
3 Originals*
following:
1.1 Service Record 3 Originals
1.2 Work Experience Sheet 3 Originals
21

LTOM, 2nd EDITION
Document Remarks
1.3 Previous Office Order of Designation as Treasurer/ 1 Certified Copy
Assistant Treasurer each
1.4 Sworn Certificate of Employment (for private work
1 Photocopy
experience)
1.4 Latest Approved Appointment (if applicable) 1 Certified Copy
1.5 Certificate of Residency*9 1 Original
2. Certificate/s of Eligibility
2.1 Civil Service Commission for CSP and/or BCLTE 1 Authenticated
Copy for each
2.2 Professional Regulation Commission (PRC) applicable eligibility
2.3 Bar
1 Certified Copy
3. Relevant Training Certificates1011
each
1 Certified Copy
4. Performance Evaluation for the last two (2) rating periods11
each
B. LGU Requirements
1. Recommendation Letter of Local Chief Executive, with the
1 Original*
following:
1.1 Sworn Statement of Non-Prohibited Relationship12 1 Original*
1.2 Certification of Availability of Funds13 1 Original
1.3 Approved Plantilla Schedule for the current year 1 Certified Copy
1.4 Publication of Vacancy (not beyond 3 months old)
1 Original
and Posting, with Qualification Standards14
1.6 Certificate of SPMS Compliance 1 Certified Copy
1.7 If applicable, provide justification/certification for: 1 Original for each
a. Quantum Leap in Salary Grade applicable case
b. Dearth of Applicants/lnclusion of Applicants from Other or include in the
LGUs recommendation
c. Non-inclusion of Next-in-Rank Employees letter
1.8 Government Issued ID with Photo and Signature of LCE 1 Certified Copy
Additional Requirement for Assistant Local Treasurer:

Certificate of Compliance with Sec. 325 of Republic Act No. 716015
* Original document must be signed by hand.

9 Certificate issued by the concerned Barangay Chairman and stating the candidate’s good moral character
10 Maximum ot 120 hours for the last 5 years for PT/CT: and 40 hours for the last 5 years for MT
11 Reckoned from the date of recommendation of the LCE
12 Certificate must state that the nominee is not within the 4th degree of affinity or consanguinity of the LCE
13 Certificate issued by the concerned Local Accountant or Budget Officer stating the authorized salary rate, salary
grade and item number of the position
14 The Qualifications Standards to be published and posted must follow Sec. 470 and 471 of Republic Act No. 7160
15 Signed by hand by the LCE and Local Accountant stating that the filling up of the position complies with Sec.
325a of the LGC
22

Second Level Basic Documentary Requirements

Document Remarks
1. Transcript of Records (except for recommendees who are 1 Authenticated

already regularly appointed Local Treasurer/Assistant Local Copy for each
Treasurer) academic degree
2. Latest Sworn Statement of Assets, Liabilities, and Net Worth
1 Original
(SALN)
3. Medical Certificate - Latest CSC Form No. 211 1 Original
4. Valid Clearances and Certificate/s of No Pending Case (if with pending case/s,
provide Case Summary/ies):
4.1 National Bureau of Investigation (NBI) 1 Original
4.2 Civil Service Commission (CSC) 1 Original
4.3 Ombudsman 1 Original
4.4 BLGF (only for recommendees who are already appointed
1 Original
LT/ALT
4.5 LGU or NGA (only for recommendees who are appointed
government personnel)
5. Marriage Certificate (for married female only) 1 Certified Copy
6. Acceptance of Lower Salary (if applicable) 1 Original
3. Submission of Documentary Requirements.
The LGU, through its Human Resource Management Officer, shall:
a. Require each recommendee to submit all documentary requirements

listed in item A under the First Level Basic Documentary Requirements
and ensure the completeness of information;
b. Prepare the documentary requirements in item B of the First Level

Basic Documentary Requirements;
c. Consolidate, label, tab and properly file in a docket or binder all

documents enumerated in Annex A, together with the letter of
recommendation of the LCE [See Annex 4 (MC 025-2019)] as cover;
and
d. Requisites in the Submission of Letter of Recommendation of the

LCE. The letter of recommendation with supporting documents shall
be submitted to the BLGF RO, through the Provincial Treasurer, in
the case of municipalities and component cities, and to the BLGF
CO Administrative Division, in the case of LGUs in the National
Capital Region (NCR), for pre-evaluation and initial screening. If the
recommendation is made by the LCE in Acting Capacity, compliance
with Sec. 46 of RA No. 7160, or the LGC, shall be observed.
23

LTOM, 2nd EDITION
4. First Level (Initial Screening) Process. The concerned BLGF Action Officer
shall pre-evaluate the LGU's compliance with the documentary requirements
and provide immediate feedback. In case the documents submitted are
found incomplete or deficient, the LGU shall be properly notified using the
prescribed forms under the said guidelines. The evaluation ofthe documents
shall be certified as to completeness and orderliness, and submitted to
the BLGF Regional and Central Human Resource Merit Promotion and
Selection Boards (HRMPSBs) for deliberations. The BLGF HRMPSB shall
deliberate and rank the recommendees for LT and/or ALT position/s. It shall
comparatively evaluate all recommendees using the prescribed evaluation
form. Interview of recommendees by the BLGF Regional Director or
Executive Director, as the case may be, shall be required to further evaluate
the candidates' capacity for the position, and the corresponding points shall
be included in the evaluation sheet. The results of each deliberation shall
be formalized through a Board Resolution, and supported by duly signed
summary of ratings, including all the First Level documentary requirements
and the accomplished compliance certification, to be submitted to the BLGF
Central HRMPSB.
5. Second Level (Final Deliberation) Process. The BLGF Central HRMPSB

shall conduct the corresponding Second Level process for the final
deliberation of all recommendees. The BLGF CO Administrative Division
shall communicate the results to the BLGF RO to inform the concerned
recommendee ofthe submission ofthe documentary requirements specified
in the Second Level Basic Documentary Requirements. Upon completion of
all the required documents, the BLGF Central HRMPSB Chairperson shall
endorse the proposed appointment papers to the Secretary of Finance,
through the Undersecretary of Revenue Operations Group (ROG), for final
action, togetherwith the certification as provided. As part of due diligence, the
BLGF Office ofthe Executive Director, the ROG Office ofthe Undersecretary,
and/or the DOF Office ofthe Secretary may require additional information or
clarification whenever warranted.
6. Return Without Action Policy. All recommendations or documents received

by the BLGF RO or CO that are not compliant with the requirements shall
be given up to thirty (30) days upon issuance of notification to complete
the same. If after the lapse of the said period the requirements remain
to be completed, the entire set of documents shall be immediately and
formally returned without action to the concerned LCE. In cases of individual
applications received by the BLGF, the same shall be immediately referred
to the concerned LCE for appropriate action.
7. Issuance of Appointment Papers. All appointments signed and issued

by the Secretary of Finance shall be subject for attestation by the CSC.
The same are not covered by Section 18 Rule VI of the ORAOHRA, which
requires the concurrence of the majority of all the members of the local
Sanggunian to approve such appointments, inasmuch as the appointing
authority is the Secretary of Finance.
24

As per Item No. 3.11 of DPO No. 477.2019, a certified true copy of the
appointment shall be issued to the appointee, through the BLGF, copy
furnished the LCE, in order that said appointee can immediately take his/
her oath of office and assume the duties of the position. In cases where
the nature of the appointment issued involves promotion or transfer from
another agency or LGU to another, the appointee shall seek an Authority
to Transfer from the head of the agency where he/she is employed prior to
assumption, which shall be submitted to the BLGF CO. Upon receipt of the
copy of appointment, the appointed LT or ALT shall submit to the CSC Field
Office, through the BLGF CO Admin Division, the following:
a. Duly acknowledged, signed and dated Appointment Paper;
b. Copy of the Oath of Office; and
c. Clearance Form (CSC Form No.7).
C. Reappointment. In case of modifications in appointment due to conversion of the

local government (i.e., cityhood, division, merger, etc.), such shall be requested
by the LCE concerned and shall be screened and evaluated by the respective
BLGF Regional and Central HRMPSBs following the foregoing procedures and
requirements, to wit:
1. Recommendation Letter of Local Chief Executive, with the following:
a. Sworn Statement of Non-Prohibited Relationship;

b. Certification of Availability of Funds;
c. Approved Plantilla Schedule for the current year; and
d. Government Issued ID with Photo and Signature of LCE.
2. Personal Data Sheet (PDS) - CSC Form No. 212, with the following:
a. Service Record;
b. Work Experience Sheet;
c. Office Order of Designation as Treasurer/Assistant Treasurer;
d. Latest Approved Appointment; and
e. Certificate of Residency.
3. Certificate/s of Eligibility (CSC, PRC, BAR)
4. Relevant Training Certificates
5. Performance Evaluation for the last two (2) rating periods
6. Latest Sworn Statement of Assets, Liabilities, and Net Worth (SALN)
7. Valid Clearances and Certificate/s of No Pending Case (if with pending

case/s, provide Case Summary/ies): NBI, CSC, Ombudsman, BLGF
8. Marriage Certificate, if applicable.
25

LTOM, 2nd EDITION
Pending the issuance of an appointment, the incumbent treasurer/assistant

treasurer may be issued a Notice of Salary Adjustment to effect the commensurate
salary of the position upon the conversion of the LGU. For requests for change of
position title which corresponds to a reappointment, the publication of the position
is no longer necessary. Copies of the LGU’s Charter and plebiscite shall, however,
be likewise submitted to support the request.
D. Administrative Costs. All administrative costs related to the conduct of screening

and deliberations by the BLGF ROs and CO shall be chargeable to the concerned
BLGF office funds only. No fees, of whatever nature, shall be collected for the
processing of appointments from the LGU or individual recommendees.
(BLGF Memorandum Circular No. 025-2019, 30 October 2019)
SECTION 9. DESIGNATION OF ACTING/OFFICER-IN-CHARGE (QIC)/

IN-CHARGE OF OFFICE (ICO) - PROVINCIAL/CITY/
MUNICIPAL TREASURERS AND ASSISTANT TREASURERS
A. General Guidelines on Designation Pursuant to CSC Memorandum Circular
(MC) No. 24 s. 2017 - The designation of a treasurer shall be in accordance with
the following civil service rules:
1. Employees to be designated should hold permanent appointments in

career positions;
2. Designees can only be designated to positions within the level they

are currently occupying. Employees holding first level positions cannot
be designated to perform the duties of second level positions except
in meritorious cases as determined by the CSC Regional Office upon
request for exemption by the agency concerned, such as organizational
set-up, calamity and due to exigency of the service. The exception shall
not apply to positions involving supervisory and executive managerial
functions. Division Chiefs may be designated to perform the duties of
second level executive/ managerial or third level positions;
3. For position with incumbents who temporarily cannot perform the

duties of the position (vacation, or sick leave, study leave, scholarship,
maternity leave, special assignments), the designation should be
synchronized with the absence of the incumbent, unless earlier revoked
or recalled by the appointing officer/authority. However, the designation
of employees every year may be renewed in the exigency of the service
but not to exceed two (2) years;
4. For position without incumbents, a designation may be made only for

a maximum of one (1) year. However, the designation of employees
every year may be renewed in the exigency of the service but not to
exceed two (2) years;
26

5. Designations shall be made through an office order issued by the

appointing officer/authority concerned;
6. For designations to critical positions in the local government units

such as Provincial/City/Municipal Government Department Head, a
copy of the office order shall be furnished by the HRMOs of the LGUs
to the CSCFO concerned. Employees designated to positions with
duties involving practice of profession shall be required to possess the
necessary professional license;
7. Designees cannot be granted the salaries of the positions they are

being designated to. However, allowances that go with the performance
of the functions, such as RATA (Representation and Transportation
Allowances) or EME (Extraordinary and Miscellaneous Expenses) may
be granted as provided underthe provisions of the General Appropriations
Act (GAA) or appropriation of the respective local sanggunian; provided
the grant of the same is specifically stated in the designation order; and
8. Only experience gained from designation compliant with the above

stated rules shall be credited as relevant experience for purposes of
appointment.
B. Designation of Local Treasurers and Assistant Local Treasurers - As a

general rule, the authority to designate an Acting/OIC/ICO Provincial, City or
Municipal Treasurer, or their respective Assistants, including the authority for
the payment of RATA and the extension of such designation, is delegated to
the concerned BLGF Regional Director, subject to the confirmation of the BLGF
Executive Director, in accordance with established rules and procedures for the
purpose. The designation of City and Municipal Treasurers and their Assistants
in the National Capital Region shall be made by the Secretary of Finance, upon
the indorsement of the BLGF Executive Director. (Department Special Order No.
01-2018 dated 09 November 2018)
C. Qualifications of the Acting/OIC/ICO - Provincial/City/Municipal Treasurer

and Acting/OIC/ICO-Assistant Treasurers - The proposed designee should
meet the following requirements:
1. Must have complied with the minimum qualification requirements of the

position pursuant to the provisions of Secs. 470 and 471 of the LGC;
2. Must belong to the local treasury service over which the Secretary of
Finance, through the Bureau of Local Government Finance, exercises
administrative and technical supervision;
In the absence of qualified and ranking personnel from the local treasury
office, ranking and qualified personnel from the local accounting or
budget offices, assessment office and other related LGU offices, or the
BLGF Central or Regional Offices, may be considered, subject to first
being detailed or reassigned by the appointing authority concerned to
27

LTOM, 2nd EDITION
the Local Treasury Office to which the recommendee will be assigned

before the designation as Acting/OIC/ICO can be effected; and
3. Must have completed or passed any additional competency standards

instituted by the Department of Finance (DOF), whether implemented
directly by the DOF or by an appropriate national government agency
in partnership with the DOF.
D. Recommendation of Local Chief Executive Required for Designations.

The designation of an Acting/OIC/ICO Provincial/City/ Municipal Treasurer and
Acting/OIC/ICO Assistant Provincial/City/Municipal Treasurer shall require written
request of the Local Chief Executive concerned.
E. Specific Guidelines in the Issuance of Designations of Provincial, City and

Municipal Treasurers and Assistant Treasurers.
1. The following designations shall be issued in case a vacancy occurs in the

Office of the Provincial, City or Municipal Treasurer or Assistant Treasurer:
a. Acting Treasurer/Assistant Treasurer
i. If the vacancy is permanent, occasioned by the retirement,

resignation, transfer, death, dismissal from the service,
which is final, and other modes of separation, which are
permanent in nature, of the regular incumbent and the
proposed designee meets the minimum qualifications
required for the position.
ii. The designee shall discharge fully the powers and

responsibilities of the Provincial, City, Municipal Treasurer
or Assistant Treasurer, as a result of permanent vacancy of
the position, with the same rights and prerogatives of the
position, except the right to receive the salary appurtenant
thereto.
b. Officer-in-Charge (QIC)
i. If the vacancy is temporary, occasioned by the suspension,

leave of absence or official travel exceeding five (5) working
days, dismissal from the service, which is not yet final,
detail to other station, and other forms of sudden incapacity
of the regular incumbent to perform official duties, and
the proposed designee meets the minimum qualifications
ii. The designee shall discharge fully the powers and

responsibilities as Provincial, City or Municipal Treasurer
or Assistant Treasurer, as a result of temporary vacancy of
the position, with the same rights and prerogatives of the
concerned position, except the right to receive the salary
appurtenant thereto.
28

c. In-Charge of Office (ICO)
i. If the vacancy in the position of Provincial, City or Municipal

Treasurer is not exceeding five (5) working days, and the
proposed designee meets the minimum qualifications
ii. As ICO Treasurer, the designee shall perform the duty in a

caretaker capacity, which shall be confined only to day-to-
day operations and functions of administration of the office,
such as signing authority over recurring transactions and
mandatory or statutory obligations of the local government
unit concerned.
2. Designations of Acting/OIC Treasurer and Assistant Treasurer shall be for

a period of one (1) year, unless sooner revoked. As may be applicable, the
period of designation shall be synchronized with the period of the absence
of the regular incumbent. As a matter of sound policy and when the exigency
of service so requires, designations may be extended but not to exceed one
(1) year, in accordance with Items 3 and 4, Sec. 13 of CSC MC No. 24, s.
2017, except when:
a. The designee for Provincial, City or Municipal Treasurer is the

regularly appointed Assistant Local Treasurer;
b. The filling up of the vacant position held by the designee is in

process and the designee is considered for the position;
c. The incumbent Treasurer or Assistant Local Treasurer is

suspended for a period exceeding one (1) year, wherein the
designation may be extended for the remaining period of
suspension;
d. The incumbent Treasurer or Assistant Local Treasurer is

dismissed from the service, but the decision is not yet final; and
e. There is established dearth of qualified employees within the

local government concerned. In the case of municipalities, the
concerned Provincial Treasurer shall certify such dearth in the
local treasury offices under his/her jurisdiction before designees
from non-treasury and other LGU treasury offices are considered.
3. All designations and extension thereof shall be upon the written request
of the local chief executive. In the case of designations of Treasurer and
Assistant Local Treasurer of component cities and of municipalities, the
indorsement of the concerned Provincial Treasurer is required. Extension
of designations shall only be conditioned on the satisfactory performance
of the designee during the period of designation pursuant to the approved
Strategic Performance Management System.
4. Designations of City and Municipal Treasurers and Assistant Local Treasurers

in the National Capital Region and extensions thereof shall be made by
29

LTOM, 2nd EDITION
the Secretary of Finance, except for ICO, which shall be acted upon by
the BLGF Executive Director. All other designations shall be made by the
concerned BLGF Regional Director, and such designations and extensions
thereof shall be confirmed by the BLGF Executive Director.
Designations of treasurers/assistant treasurers shall be processed by the

BLGF within fifteen (15) days before the expected temporary or permanent
vacancy. The designation Order issued by the Regional Office shall thereafter
be submitted to the BLGF Central Office within fifteen (15) days from its
issuance, for confirmation by the BLGF Executive Director. Non-submission
of the designation order for confirmation and/or non-compliance thereof will
render subject Order ineffective.
5. Designations shall comply with the requirements of DOF Department

Personnel Order No. 335-03, as amended, and Department Order No.
053.2016, as amended, establishing the Standardized Examination and
Assessment for Local Treasury Service (SEAL) Program. The requirement
of SEAL Level 1 in the designation of local treasurers and assistant local
treasurers shall take effect in June 2019 to provide for sufficient transition
period, address the dearth of qualified personnel in the local treasury offices
who may be designated for the purpose, and allow local treasury personnel
to acquire the certification through the Basic Competency on Local Treasury
Examination of the Civil Service Commission.
(DOF Personnel Order No. 469.2018, 24 May 2018 amending DPO No.
562.2016, 10 November 2016)
6. The rule on nepotism shall also apply in the designation of treasurers/

assistant treasurers.
7. Designations of employees holding first level positions to local treasurer or

assistant treasurer positions shall require prior approval from the concerned
CSC Regional Office, upon the request of the BLGF Regional Director
having jurisdiction thereof, in accordance with Sec. 13.C.2 of CSC MC No.
24, s.2017.
8. In case the designee is detailed from another LGU or office, the detail
should be covered by an agreement between the LCE of both LGUs or the
concerned agency head, particularly as regards the continued payment of
the salaries and other benefits of the designee by the LGU or office where
he/she is regularly appointed, and the subsequent return to his/her regular
station once deemed necessary and in the absence of any legal impediment,
pursuant to Sec. 13 (b) of CSC MC No. 24, s. 2017.
9. The BLGF Executive Director shall confirm the designations of provincial,

city, and municipal treasurers issued by the BLGF Regional Offices.
(DPO No. 308. 2016 dated 29 July 2016 as amended by DPO No. 094.
2017, 17 February 2017)
30

F. Documentation - Designations submitted to the DOF, through the BLGF Central

Office, for confirmation, shall be supported by the following documents:
1. Regional Special Personnel Order (RSPO) issued by the BLGF Regional

Director;
2. Comments/Recommendations of the BLGF Regional Director contained in

an Indorsement;
3. Written endorsement of the Provincial Treasurer, in the case of the Acting/

OIC Municipal Treasurer and Acting/OIC Assistant Municipal Treasurer,
or Acting/OIC City Treasurer and Acting/OIC Assistant City Treasurer of
component cities;
4. Written request and recommendation of the Local Chief Executive(s)

concerned;
5. Updated Personal Data Sheet, as prescribed by the CSC;
6. Copy of the plantilia of the local treasury office of the LGU concerned;
[DOF Department Personnel Order (DPO) No. 335-03, 01 October 2003]
7. Justification in case the most ranking personnel in the treasury office was not
considered. In cases where there is no eligible personnel, a list of personnel
in the treasury office indicating their respective civil service eligibilities should
be attached;
8. Authenticated Civil Service Eligibility by the Civil Service Commission (CSC)

or its equivalent; (Art. V, Sec. 9, PD 807)
9. Sworn Statement of Assets and Liabilities of the immediate preceding year;

(Sec. 34, Chapter 9, Book 1, Administrative Code of 1987)
10. Performance Ratings using the CSC-approved Strategic Performance

Rating System of the LGU or results from any other performance evaluation
tool instituted by the DOF, applied during the period of designation, should at
least be Very Satisfactory or its equivalent thereof; (CSC MC No. 6, s. 2012)
11. Affidavit of Disclosure re: non-dual citizenships; (BLGF Memorandum

Circular No. 10-001-2016, 03 October 2016)
12. Notarized certification of non-relationship within the 4th degree of

consanguinity to the designee issued by the LCE;
13. Certification of the Provincial Treasurer that there is dearth of qualified

employees within the local government concerned, if applicable;
14. Written agreement between the LCEs or heads of agency concerned in case
the designee needs to be detailed to the local treasury office; and
15. Authority or approval of the CSC Regional Office concerned allowing the
designation of a first level employee and/or a detailed employee to be
designated Acting/OIC/ICO Treasurer or Assistant Treasurer.

LTOM, 2nd EDITION
SECTION 10. AUTOMATIC SUCCESSION OF THE ASSISTANT

PROVINCIAL/CITY/MUNICIPAL TREASURER
A. When the incumbent Local Treasurer dies, absconds or becomes incapacitated
and when the exigencies so require, the regularly appointed Assistant Local
Treasurer may automatically perform the functions as In-Charge of Office (ICO),
as defined in Sec. 9 hereof, without the need of order of designation from the
BLGF.
B. However, the regularly appointed Assistant Local Treasurer who automatically

assumes as ICO Local Treasurer shall within twenty-four (24) hours notify directly
the concerned BLGF Regional Director, the concerned banks and the COA of
the absence, sickness, death or any other reason of incapacity of the regular
incumbent to discharge his/her functions, and of the date of his/her assumption.
C. Within forty-eight (48) hours after receipt of the notice, the BLGF Regional Director
shall, in the absence of the recommendation of the LCE concerned, issue the
Order of Designation of the Assistant Local Treasurer. The rules under Sec. 9
hereof shall suppletorily apply. In the case of the NCR, the BLGF Executive Director
shall immediately recommend to the Secretary of Finance for the issuance of the
designation order.
D. It shall be the duty of the BLGF to ensure that impending vacancies are properly
monitored and immediately acted upon, and that the concerned local chief
executive is properly informed.
SECTION 11. DESIGNATION IN THE ABSENCE

OF AN ASSISTANT LOCAL TREASURER
In cases where there is no regularly appointed Assistant Provincial/City/Municipal
Treasurer, the next ranking and qualified personnel of the Local Treasury Office, who
is duly bonded, may be designated as Acting, OIC or ICO Provincial/City/Municipal
Treasurer, as the case may be. If other ranking and qualified personnel of other offices
outside of the Local Treasury Office of the LGU concerned, who is duly bonded,
is considered due to dearth of qualified and competent personnel within the local
treasury office, he/she may be designated as Acting or OIC or ICO Provincial/City/
Municipal Treasurer. The policies and procedures set under Sec. 9 of this Manual
shall be adopted for this purpose.
SECTION 12. RELIEF OR DETAIL OF TREASURERS

AND ASSISTANT LOCAL TREASURERS
A. Requests for relief of treasurers and assistant treasurers shall be acted upon only
for justifiable reasons and after compliance with the requisites of due process as
follows:
32

1. The treasurer consents thereto;
2. There exists an audit finding of actual shortage of cash which should be on

hand, pursuant to Sec. 348 of the LGC;
a. No order of relief shall be authorized unless the following are

established in coordination with the COA:
i. The actual date/s of auditorial visit by COA;
ii. Existence of actual cash shortage as appearing in the Cash

Examination Report; and
iii. There is a written recommendation from the COA for the relief of
the treasurer or assistant treasurer.
b. Upon confirmation with the COA, the Regional Director shall

immediately direct the relief from the office of the treasurer/ assistant
treasurer.
c. The concerned treasurer/assistant treasurer shall secure a clearance

from the COA relative to his/her restoration to Office.
3. The treasurer/assistant treasurer has been formally charged with grave

offense and the ninety (90)-day preventive suspension has expired, but
formal investigation has not yet been terminated.
(DOF Department Personnel Order 335-03, 01 October 2003)
B. The detail of Treasurers and Assistant Treasurers shall be in accordance with

Section 4 of Department Special Order No. 01.2018, dated 09 November 2018,
and shall be governed by the following guidelines, in accordance with Sec. 13 (b)
of CSC MC 24, s. 2017:
1. A detail is the temporary movement of an employee from one department

or agency to another which does not involve a reduction in rank, status or
salary.
2. An office order shall be issued by the appointing authority. Hence, in the

case of a local treasurer being detailed to another office or agency, the detail
order shall be issued by the Secretary of Finance or his/her duly authorized
representative upon the recommendation/consent/approval of the local
chief executive concerned. The local treasurer/assistant treasurer detailed
receives his/her salary only from his/her parent unit/agency.
3. A detail without the consent of the treasurer shall be allowed only for a
maximum period of one (1) year. Detail with consent shall be allowed for a
maximum of three (3) years provided that the extension or renewal thereof
shall be discretionary on the part of the parent agency.
4. The detail of a treasurer/assistant treasurer from one department or agency

to another shall be covered by an agreement manifesting the arrangement
between the agency heads that it shall not result in reduction in rank, status
33

LTOM, 2nd EDITION
or salary of the employee, the duration of the detail, duties to be assigned to

the employee and responsibilities of the parent agency and the receiving
agency.
5. No detail shall be made within three (3) months before any election unless
authorized by the COMELEC. (Sec. 5, Rule XVIII; Omnibus Rules
Implementing Book V of E. O. No. 292 and Other Pertinent Civil Service
Law)
6. If the treasurer/assistant treasurer believes that there is no justification for

the detail, he/she may appeal the detail order within fifteen (15) days from
receipt to the CSC (Commission) or CSC Regional Office (CSCRO) with
jurisdiction. Pending appeal, the detail order shall be executory unless
otherwise ordered by the CSC. Decision of said CSCRO may be further
appealed to the Commission within fifteen (15) days from receipt.
7. During the period of the detail, the parent LGU relinquishes administrative
supervision over the detailed treasurer/ assistant treasurer to the receiving
agency. Administrative supervision refers to the authority to direct the
performance of duties; restrain the commission of acts; and review, approve,
reverse or modify acts or decisions of the detailed treasurer/assistant
treasurer. In this regard, the receiving agency has the responsibility to
monitor the punctuality and attendance of the employee, approve requests
for leave, evaluate his/her performance, grant the authority to travel and
exercise other acts necessary to effectively supervise the treasurer/assistant
treasurer; provided a report on said matters is submitted to the parent agency
for record purposes.
8. Prior to the effectivity of the detail, the parent LGU shall furnish a certification
of the available sick and vacation leave credits of the detailed treasurer/
assistant treasurer to the receiving agency. In the event the receiving agency
approves requests for leave by the detailed treasurer/ assistant treasurer, a
copy of the same shall be submitted to the parent LGU.
9. The detailed treasurer or assistant treasurer shall be designated to a position

whose duties are comparable to his/her position in the parent agency.
However, he/she shall not be designated to a position exercising control or
supervision over regular and career employees of the receiving agency.
10. The authority to discipline the detailed treasurer/assistant treasurer is still

vested in the appointing officer/authority of the parent agency where he/she
belongs. As used herein, the authority to discipline includes the determination
of the existence of a prima facie case against the detailed treasurer/assistant
treasurer, issuance of a formal charge, issuance of the order of preventive
suspension if the case so warrants, conduct of formal investigation, and
rendering of the decision on the administrative case.
11. With respect to personnel actions such as promotion, transfer, renewal,

change of status, demotion, upgrading and reclassification of positions and
the like, which require the issuance of an appointment, and other personnel
34

movements such as reassignment, detail, secondment, job rotation and

designation which do not necessarily require the issuance of an appointment,
including salary adjustment, step-increment and monetization of leave
credits concerning the detailed treasurer/ assistant treasurer, the same shall
still be under the jurisdiction of the mother agency notwithstanding that the
local treasurer/assistant treasurer is detailed in another agency.
12. All human resource actions and movements, including monetization of leave
credits, concerning the detailed treasurer/assistant treasurer, shall still be
under the jurisdiction of the parent agency, notwithstanding his/her detail in
another agency.
SECTION 13. OTHER PERSONNEL ACTIONS FOR LOCAL TREASURERS

The following human resource actions shall be approved by the Secretary of Finance,
or his/her duly authorized representative, subject to the recommendation/indorsement
of the concerned local chief executive:
A. Secondment
1. Secondment is the movement of an employee from one department or

agency to another which is temporary in nature and which may or may not
require the issuance of an appointment which may either involve increase in
compensation and benefits. Acceptance thereof is voluntary on the part of
the employee.
2. An office order shall be issued by the appointing authority or his/her duly

authorized representative in favour of the seconded Treasurer/Assistant
Treasurer, considering that secondment is a personnel action. (CSC letter
dated 7 November 2016)
3. Secondment shall be governed by the following general guidelines:
a. Secondment shall be limited to employees occupying managerial,

professional, technical and scientific positions;
b. Secondment to international bodies/organizations recognized by the

Philippine government may be allowed;
c. Secondment for a period of one year or more shall be subject to

approval by the CSC. In case the secondment of less than one year is
extended and such extension shall cover a total period of one year or
more, the extension shall be subject to CSC approval;
d. Approval of the secondment shall be subject to the following conditions:
i. A Memorandum of Agreement or contract for secondment

between the parent and receiving agency, concurred in by the
35

LTOM, 2nd EDITION
treasurer/assistant treasurer and approved by the Secretary

of Finance, shall be submitted to the CSC within 30 days from
signing of the contract;
ii. A seconded treasurer/assistant treasurer shall not be allowed to

report to the receiving agency earlier than the date of signing of
the Memorandum of Agreement; and
ill. The period of secondment shall be for a maximum of three (3)

years except otherwise provided by law or as required under
bilateral/ multilateral agreements.
e. Any violation of the provisions of the Memorandum of Agreement shall

be ground for discontinuance thereof without prejudice to the filing of
disciplinary action against the person/s responsible for the violation;
f. Acceptance of scholarship by a seconded treasurer/assistant treasurer

shall terminate the secondment;
g. Payment of salaries of a seconded treasurer/assistant treasurer shall

be borne by the receiving agency. In case of a higher compensation
covered by a duly issued appointment within the Philippine government,
the same may be used for the purpose of computing his retirement
benefits but not for the purpose of commutation of leave credits earned
in the mother agency. In case of a lower compensation, the parent
agency (LGU) shall pay the difference. This rule does not apply in
cases of secondment to international agencies; and
h. The seconded treasurer/assistant treasurer shall be on leave without

pay in his/her parent agency (LGU) for the duration of his secondment,
and during such period, he or she may earn leave credits which are
commutable immediately thereafter and payable by the receiving
agency.
[Sec. 6 (c), CSC MC No. 15, s. 1999]
B. Transfer (Sec. 11 of CSC MC No. 24, s. 2017)
Transfer is the movement of an employee from one position to another which is of

equivalent rank, level or salary without gap in the service involving the issuance
of an appointment.
The transfer may be from one organizational unit to another in the same department
or agency or from one department or agency to another.
A treasurer/assistant treasurer who seeks to transfer to another office shall notify

the LCE concerned in writing within 30 days prior to the effective date of his/her
transfer. The LCE shall endorse the said request to the Secretary of Finance, or
his/her duly authorized representative, who shall notify the treasurer/assistant
treasurer in writing of the approval of the request within 30 days from date of notice.
If said request is not granted by the LCE or the Secretary of Finance, or his/her duly
36

authorized representative, it shall be deemed approved after the lapse of 30 days

from the date of notice without the need to notify the employee concerned. It is
understood that the treasurer/assistant treasurer who seeks to transfer is cleared
from money, property and work-related accountabilities.
If, for whatever reason, the treasurer/assistant treasurer fails to transfer on the
specified date, he/she shall be deemed resigned. However, should he/she opt to
remain in the same LGU before the specified date of transfer, he/she may be
reappointed if there is no gap in the service or reemployed if there is gap in
service. In both cases, the treasurer/assistant treasurer shall undergo the usual
hiring process.
Transfer during election period shall be governed by COMELEC rules and

regulations.
C. Reassignment [Sec. 13(a) CSC MC No. 24, s. 2017]
Reassignment is the movement of an employee across the organizational structure

within the same department or agency, which does not involve reduction in rank.
The reassignment of local treasurers and assistant local treasurers shall be made
in accordance with Section 4 of Department Special Order No. 01.2018, dated 09
November 2018, and shall be governed by following civil service rules:
1. Reassignment of employees with station-specific place of work indicated in

their respective appointments within the geographical location of the agency
shall be allowed only for a maximum period of one (1) year. The restoration
or return to original post/assignment shall be automatic without the need of
any order of restoration/revocation ofthe order of reassignment.
An appointment is considered station-specific when: (a) the particular office

or station where the position is located is specifically indicated on the face of
the appointment paper; or (b) the position title already specifies the station,
such as Human Resource Management Officer, Accountant, Budget Officer,
Assessor, Social Welfare and Development Officer, and such other positions
with organizational unit/station-specific function. Such position titles are
considered station-specific even if the place of assignment is not indicated
on the face of the appointment.
It is noted that the appointment of a treasurer/assistant treasurer is station

specific.
2. Reassignment is presumed to be regular and made in the interest or exigency

of public service unless proven otherwise or if it constitutes constructive
dismissal. Constructive dismissal exists when an official or employee quits
his/her work because of the agency head’s unreasonable, humiliating, or
demeaning actuations, which render continued work impossible because of
geographic location, financial dislocation and performance of other duties
and responsibilities inconsistent with those attached to the position. Hence,
the employee is deemed illegally dismissed. This may occur although there
37

LTOM, 2nd EDITION
is no diminution or reduction in rank, status or salary of the employee.
Reassignment that constitutes constructive dismissal may be any of the

following:
a. Reassignment of an employee to perform duties and responsibilities

inconsistent with the duties and responsibilities of his/her positions
such as from a position of dignity to a more servile or menial job;
b. Reassignment to an office not in the existing organizational structure;
c. Reassignment to an existing office but the employee is not given any

definite set of duties and responsibilities;
d. Reassignment that will cause significant financial dislocation or will

cause difficulty or hardship on the part of the employee because of
geographic location;
e. Reassignment that is done indiscriminately or whimsically because

the law is not intended as a convenient shield for the appointing/
disciplining officer to harass or oppress a subordinate on the pretext
of advancing and promoting public interest, such as reassignment
of employees twice within a year, or reassignment of career service
officials and employees with valid appointments during change of
administration of elective and appointive officials; or
f. Reassignment that results in constructive dismissal must be sufficiently

established.
3. The employee may appeal the reassignment order within 15 days upon receipt
thereof to the Commission or CSCRO with jurisdiction, as provided under
specific law, if he/she believes there is no justification for the reassignment.
Pending appeal, the reassignment shall not be executory. The decision of
the CSCRO may be further appealed to the Commission within 15 days from
receipt thereof.
Reassignment during election period shall be governed by COMELEC rules

and regulations.
D. Reinstatement [Sec. 11(f) CSC MC No. 24, s. 2017]
The reinstatement of a treasurer/assistant treasurer shall be guided by the

following:
Reinstatement to a comparable position- is the restoration of a person, as a result

of a decision, to a career position from which he/she, through no delinquency or
misconduct, been separated but subject position is already abolished, requiring the
issuance of an appointment to a comparable position to the separated employee.
Reinstatement to the position - involves the restoration of a person, as a result of

a decision, to a career position from which he/she, through no delinquency or
38

misconduct, been separated from the service but subject position is still available,
does not need the issuance of an appointment.
The reinstatement of treasurers/assistant treasurers shall be effected upon the

issuance of an appropriate order of the Secretary of Finance or the Executive
Director of BLGF, as may be applicable.
E. Extension of Service [Sec. 129, CSC MC No. 24, s. 2017]
The extension of service of a treasurer/assistant treasurer who will reach the

compulsory retirement age of 65 years may be allowed for a period of six (6)
months and in meritorious circumstances may be extended for another six (6)
months. The request for extension shall be filed with the CSC not later than three
(3) months prior to the date of his/her compulsory retirement. Services rendered
during the period of extension shall no longer be credited as government service.
However, for one who will complete the fifteen (15) years of service required under
the GSIS Law, a maximum period of two (2) years may be allowed. Services
rendered during the period of extension shall be credited as part of government
service for purposes of retirement.
The request shall be submitted to the BLGF with the following documents:
1. Recommendation for the extension of service signed by the Local

Chief Executive concerned, or the treasurer in case of extension
to complete the 15-year service required under the GSIS Law,
containing the justifications for the request;
2. Certification by a licensed government physician that the treasurer/

assistant treasurer subject to the request is still mentally and
physicallyfit to perform the duties and functions of his/her position;
3. Certified true copy of the employee’s Certificate of Live Birth;
4. Clearance of no pending administrative case issued by the CSC,

Office of the Ombudsman, the LGU concerned and the BLGF;
5. Service record of the treasurer/assistant treasurer, if the purpose of

the extension is to complete the 15-year service requirement under
the GSIS Law;
6. Certification from the GSIS on the Total Length of Service (TLS) of

the treasurer or assistant treasurer for those who are completing the
15-year service requirement;
7. Certified true copy of the updated Plantilla of Personnel issued by the

LGU HRM Officer; and
8. Proof of payment of the filing fee.
39

LTOM, 2nd EDITION
The request shall be forwarded to the BLGF Executive Director, thru the concerned
BLGF Regional Director and Provincial Treasurer, as may be applicable, for initial
evaluation, not later than six (6) months prior to retirement.
The BLGF Executive Directorshall evaluate the recommendation and subsequently

endorse the same to the CSC for approval.
The only basis for the Secretary of Finance, BLGF Executive Director or the LCE
to allow treasurers/ assistant treasurers to continue rendering service after his/
her 65th birthday is a CSC Resolution granting the request for extension. In the
absence of such resolution, the said treasurer/assistant treasurer shall not be
authorized to perform the duties of his/her position and his/her salaries shall be
the liability of the official responsible for the continued service of the treasurer/
assistant treasurer.
During the period of extension, the employee on service extension shall be

entitled to salaries and salary increases, allowances, and other remunerations that
are normally considered part and parcel of an employee’s compensation package
subject to the existing regulations on the grant thereof, except step increments.
The treasurer/assistant treasurer shall likewise be entitled to 15 days’ vacation
and 15 days sick leave annually, provided that the same are not commutative and
cumulative.
F. Other Modes of Separation from the Service
1. Resignation
The resignation of a local treasurer/assistant local treasurer shall be guided

by the provisions of Sec. 104 of CSC MC No. 24, s. 2017:
a. Resignation is an act of an official or employee by which he/she

voluntarily relinquishes in writing his/her position effective on a specific
date which shall not be less than thirty (30) days from the date of such
notice or earlier as mutually agreed upon by the employee and the
appointing officer/authority. To constitute a complete and operative
resignation of an official or employee, there must be a written intention
to relinquish the office, the acceptance by the appointing officer/
authority and a written notice of such acceptance duly served to the
official or employee concerned (It is now clear that there is a 30-day
notice rule in the government sector. Also note that in the case of
Reyes v. Atienza, 470 SCRA670, the Supreme Court said that without
acceptance by competent authority, resignation is nothing and the
officer remains in office.)
b. An official or employee is deemed to have tendered his/her resignation

upon receipt by the appointing officer/authority of the former’s written
resignation.
c. Pending receipt by the official or employee of the action taken

by the appointing officer/authority on the resignation, the official or
40

employee shall remain in office and retain all the powers, duties and
responsibilities appurtenant thereto.
d. The appointing officer/authority shall act on the notice of resignation

within 30 days from receipt thereof. In case the resignation of the
official/employee remains unacted upon for 30 days from receipt of the
formal letter of resignation by the appointing officer/authority, it shall be
deemed complete and operative on the specified date of effectivity or
30 days from submission thereof, in cases where the effectivity date
is not specified. It must be understood, however, that the required
clearance from money, property and work-related accountabilities shall
be secured by the official or employee before or immediately after the
date of effectivity of resignation.
e. In the interest of service, however, the appointing officer/authority may

set a date of effectivity of the resignation, but in no case shall be earlier
than the date specified in the letter of resignation or 30 days from
submission thereof.
f. The acceptance of resignation is mandatory. The appointing officer/

authority may suspend the effectivity date of resignation despite its
initial written notice of acceptance due to any of the following reasons:
i. When the country is at war or when any other national or local

emergency has been declared by the appropriate authority; and
ii. When it is necessary to prevent loss of life or property or in case

of imminent danger to public safety due to an actual or impending
emergency caused by serious accidents, fire, flood, typhoon,
earthquake, epidemic or other disaster or calamity.
A resignation previously suspended due to any of the above-mentioned

reasons shall nonetheless be effective 30 days after the circumstances
causing the previous suspension has ceased as certified by the
appropriate authority or the appointing officer/authority.
g. If the last day of the period given to the appointing officer/authority to

act and furnish copy of the written action on the tendered resignation
falls on a holiday or non-working day, copy of the written action shall be
furnished the official or employee concerned on the next working day
immediately following a holiday or non-working day.
h. The treasurer/assistant treasurer concerned may withdraw the tender

of resignation any time prior to the receipt of notice of acceptance of
the resignation from the Secretary of Finance or the BLGF Executive
Director, as may be applicable, or before the lapse of the 30-day
period given for the latter to act on the resignation, whichever comes
first. Such acceptance is mandatory because the resignation is not yet
considered complete.
41

LTOM, 2nd EDITION
i. Until the resignation is accepted, the tender of resignation is revocable.

Once the resignation is deemed complete and operative, the withdrawal
thereof shall not automatically restore the treasurer/assistant treasurer
to his/her former position.
In such case, once the Secretary of Finance as the appointing authority,

or the BLGF Executive Director, as may be applicable, accepts the
resignation and the treasurer/assistant treasurer is notified of such
acceptance, the resignation is complete and cannot be withdrawn
unless the appointing authority allows such withdrawal.
j. The following documents shall be submitted to the CSC Field Office

concerned within thirty (30) calendar days from the date of the
effectivity of the resignation, for record purposes:
i. the voluntary written notice of the treasurer/assistant treasurer

informing the Secretary of Finance as the appointing authority, or
the BLGF Executive Director, as may be applicable that he/she
is relinquishing his/her position and the effectivity date of said
resignation;
ii. the acceptance of resignation in writing by the Secretary of

Finance, or the BLGF Executive Director, as may be applicable
which shall indicate the date of effectivity of the resignation; and
iii. proof of notice of the acceptance of resignation to the treasurer/

assistant treasurer.
k. A treasurer/assistant treasurer under investigation, except those

prohibited by law (under Sec. 12 RA 3019 of the Anti-Graft and
Corrupt Practices Act), may be allowed to resign pending decision of
his/her case without prejudice to the continuation of the proceedings
until finally terminated.
Under RA 3019, public officers charged of bribery and any crimes are
not allowed to retire or resign pending investigation.
2. Dismissal
Dismissal is the termination or the act of being discharged from employment

or service for cause. It is the definite severance of an officer or employee
from government service on the initiative of the agency or office, CSC,
Ombudsman, or regular courts.
(Sec. 105, CSC MC No. 24, s. 2017)
The implementation of a dismissal order for a treasurer or assistant treasurer

shall be the responsibility of the Secretary of Finance or the BLGF Executive
Director, as may be applicable.
42

3. Dropping from the Rolls and Retirement pursuant to Sec. 106, CSC MC
No. 24, s. 2017
For other modes of separation of a treasurer/assistant treasurer, such as

dropping from the rolls, retirement, or death, a copy of the order of dropping
from the rolls or notice of separation signed by the Secretary of Finance or
the BLGF Executive Director, as may be applicable, stating the date of such
separation or death, shall besubmitted by the BLGF to the CSC Field Office
concerned within thirty (30) calendar days from the date of the effectivity of
the dropping from the rolls, date of separation, or death for record purposes.
SECTION 14. PREVENTIVE SUSPENSION OF LOCAL TREASURERS

A. Preventive Suspension Issued by the Office of the Ombudsman
1. Grounds. The Ombudsman may direct the preventive suspension of a

treasurer/assistant treasurer pending an investigation on the following
grounds:
a. the charge against such treasurer/assistant treasurer involves

dishonesty, oppression or grave misconduct or neglect in the
performance of duty;
b. the charges would warrant removal from the service; or
c. the respondent’s continued stay in office may prejudice the case
filed against him.
2. Duration. The preventive suspension shall continue until the case is

terminated by the Office of the Ombudsman but not more than six (6)
months, without pay, except when the delay in the disposition ofthe case by
the Office of the Ombudsman is due to the fault, negligence or petition of the
respondent, in which case the period of such delay shall not be counted in
computing the period of suspension herein provided.
(Sec. 24, R. A. 6770)
3. Entitlement to salaries and back wages. If exonerated, back salaries and

other benefits due the treasurer/assistant treasurer at the rate prescribed for
the position he/she held from the time of his/her preventive suspension until
his/her actual reinstatement shall be paid without deduction. (Edgar R. Del
Castillo vs. CSC, et al., GR No. 112513, 21 August 1997)
B. Preventive Suspension Issued by the DOF or CSC
1. Grounds. Upon petition of the complainant or motu propio, the DOF or

CSC who have concurrent administrative disciplinary authorities may issue
an order of preventive suspension upon service ofthe formal charge or notice
of charge/s, or immediately thereafter to any treasurer/ assistant treasurer
pending an investigation, if:

LTOM, 2nd EDITION
The charge involves dishonesty; oppression; grave misconduct; neglect

in the performance of duty; administrative offenses which are punishable
by dismissal from the service on its second or third offense; or if there are
reasons to believe that the local treasurer/assistant treasurer is guilty of
charges which would warrant his/her removal from the service.
An order of preventive suspension may be issued to temporarily remove

the treasurer/assistant treasurer from the scene of his/her misfeasance,
malfeasance or nonfeasance to preclude the possibility of:
a. exerting undue influence or pressure on the witnesses against

him/her; or
b. tampering with evidence that may be used against him/her.
In lieu of preventive suspension, forthe same purpose, the proper disciplining

authority or head of office, may reassign respondent to other unit of the
agency during the formal hearings.
2. Duration. Unless otherwise provided for by law, the disciplining authority may
place the respondent under preventive suspension for a maximum period of
ninety (90) days in the case of national agencies or sixty (60) days in the case
of LGUs. When the administrative case against an officer or employee under
preventive suspension is not finally decided by the disciplining authority
within the period of preventive suspension, he/she shall be automatically
reinstated in the service unless the delay in the disposition of the case is
due to the fault, negligence or petition of the respondent, in which case,
the period of delay shall not be included in the counting of the period of
preventive suspension. Any period of delay caused by motions filed by the
respondent shall be added to the period of preventive suspension. Provided,
that where the order of preventive suspension is for a period less than the
maximum period, the disciplining authority undertakes to finish the formal
investigation within the said period and is precluded from imposing another
preventive suspension. Provided, further, that should the respondent be on
authorized leave, said preventive suspension shall be deferred or interrupted
until such time that said leave has been fully exhausted.
3. Entitlement to Salaries and Back Wages. The payment of back salaries

during the period of suspension shall be governed by the following:
a. A declaration by the CSC that an order of preventive suspension is

null and void on its face entitles the treasurer/assistant treasurer to
immediate reinstatement and payment of back salaries corresponding
to the period of the unlawful preventive suspension without awaiting
the outcome of the main case.
b. The phrase “null and void on its face” in relation to a preventive

suspension order, imports any of the following circumstances:
i. The order was issued by one who is not authorized by law.

ii. The order was not premised on any of the conditions
under Sec. 26 (A and B) Rule 7, of the Revised Rules on
Administrative Cases in the Civil Service (RRACCs).
44

iii. The order of preventive suspension was issued without a

formal charge or notice of charges.
iv. While lawful in the sense that it is based on the enumerated
grounds, the duration of the imposed preventive suspension
has exceeded the prescribed periods, in which case the
payment of back salaries shall correspond to the excess
period only.
4. Reinstatement. A declaration of invalidity of a preventive suspension order

not based on any of the reasons enumerated shall result in the reinstatement
of the treasurer/assistant treasurer. The payment of back salaries shall,
however, await the final outcome of the principal case. If the treasurer/
assistant treasurer is fully exonerated of the charge/s or when penalty imposed
in the principal case is reprimand, he or she shall be paid such backsalaries.
Otherwise, no back salaries shall be awarded.
The phrase “full exoneration” contemplates a finding of not guilty for the
offense/s charged. Downgrading of the charge to a lesser offense shall not be
construed as “full exoneration” within the contemplation of these guidelines.
Even if the respondent treasurer/assistant treasurer be eventually found

innocent of the charge/s proffered against him/her, the same shall not give
rise to payment of back salaries corresponding to the period of preventive
suspension in the absence of any finding of its illegality.
(Rule 7, RRACCS)
5. Claims for salaries during preventive suspension, if exonerated, shall be

supported by the following documents:
a. A certified true copy of the order of exoneration or of the court’s

order dismissing the criminal case against the treasurer/assistant
treasurer absolving him/her;
b. A certified true copy of the authority granted by the department
head for the payment of salary during suspension; or
c. A certified true copy of the President’s order of exoneration
providingfor payment of salary during suspension.16
6. Other provisions on Suspension of Local Treasurers and Assistant Local

Treasurers:
a. Any public officer against whom any criminal prosecution under

a valid information pursuant to RA 3019 otherwise known as
the Anti-Graft and Corrupt Practices Act or under the provisions
of the Revised Penal Code on bribery is pending in court, shall
be suspended from office. Should he/she be convicted by final
judgment, he/she shall lose all retirement gratuity benefits under
16 Sec 220, Volume I, Government Accounting and Auditing Manual (GAAM)
45

LTOM, 2nd EDITION
any law, but if he/she is acquitted, he/she shall be entitled to

reinstatement and to the salaries and benefits which he/she failed
to receive during suspension, unless in the meantime administrative
proceedings have been filed against him/her.17
b. The respondent treasurer/assistant treasurer is entitled to back

salaries from the time he/she was dismissed until his/her
reinstatement - i.e. for the period of his/her preventive suspension
pending appeal. For the period of his/her preventive suspension
pending investigation, the respondent is not entitled to any back
salaries.18
SECTION 15. ATTENDANCE TO ADMINISTRATIVE, CIVIL

OR CRIMINAL INVESTIGATION OF LOCAL TREASURERS
Absence of a Treasurer or Assistant Treasurer is considered service in regular course
under the following circumstances:
A. Witness in a criminal case. When a Treasurer or Assistant Treasurer is

summoned by the court or is required by lawful authority to render service as a
witness in a criminal case, such service shall be deemed to be of service in the
regular course of employment and the Treasurer or Assistant Treasurer shall be
entitled to his/her salary during the period of such service payable by the office
to which he/she pertains, regardless of whether he/she has served for or against
the prosecution in such criminal case [Sec. 226 (a), Vol. I, GAAM], In case the
hearing or trial is conducted outside the LGU where the Treasurer or Assistant
Treasurer is stationed, he/she shall automatically be on official travel and
shall be entitled to per diem and transportation expenses, subject to the usual
accounting and auditing rules and regulations. The summons of the Court shall
be considered sufficient supporting documentation in lieu of a Travel Order.
B. Witness in his/her own behalf in a criminal or administrative proceeding.

The attendance of a Treasurer or Assistant Treasurer in his/her own behalf, to
secure his/her exoneration from charges or matter alleged against him/her is
attendance to his/her own benefit. If he/she is not under suspension, the time
consumed in such attendance shall be charged to his/her leave, if he/she has
any. Upon exoneration, however, when the case in which he/she is the accused
or the respondent is the direct result of an act performed by him/her in connection
with his/her official duties, his/her absence charged to his/her leave may be
readjusted and his/her attendance in court considered as service in due course.
But when the criminal charges filed are not the direct acts performed by him/her
in connection with his/her official duties, forced absences from duty resulting from
his/her arrest and required attendance in court may not be considered official.
He/she shall not in such case be entitled to salary. [Sec. 226 (b), Vol. 1, GAAM]
77 Sec. 13, RA 3019 otherwise known as the Anti-Graft and Corrupt Practices Act
18 CSC vs Bersamin, et al. GR No. 187858
46

C. Witness in a civil case between two private parties, and in which the
Government has no interest. A witness is not obliged to attend as such in a civil
action before any court, judge, justice, or other officer out of the province in which
he/she resides, unless the distance be less than fifty (50) kilometers from his/her
place of residence to the place of trial by the usual course of travel. Therefore,
a Treasurer or Assistant Treasurer cited to appear in a civil case between two
private parties wherein the Government has no interest, in order to testify as to
knowledge of fact obtained by him/ her in his/her official capacity, shall not be
entitled to salary for absence on account of such appearance if the distance from
his/her place of residence to the place of trial by the usual course of travel be more
than fifty (50) kilometers. If the distance involved is less than fifty (50) kilometers,
and the Local Treasurer or Assistant Local Treasurer is cited as a witness in a civil
case involving private persons as litigants for knowledge or fact acquired by him/
her in his/her private capacity, his/her absence will be chargeable against him/her
without prejudice to his/her right to seek reimbursement from the party at whose
instance he/she testified. If such witness testifies on a case from knowledge or
fact acquired by him/her in his/her official capacity, or to produce official papers
or documents, and the distance between his/her place of residence and the place
of trial is less than fifty (50) kilometers, his/her appearance will be considered
service in due course, but in such a case the province, city or municipality to
which he/she pertains shall collect witness’ fees for his/her appearance under the
conditions prescribed by the Rules of Court. [Sec. 226, (c) Vol. I, GAAM]
SECTION 16. APPROVAL AND GRANT OF APPLICATION

FOR LEAVE OF ABSENCE OF LOCAL TREASURERS
A. The approval of application for leave of Provincial, City and Municipal Treasurers
and Assistant Provincial, City and Municipal Treasurers shall be as follows:
1. All applications for leave of absence, i.e. vacation, sick, maternity/paternity,

and special privilege leave (SPL) and terminal leave of Provincial/City/
Municipal Treasurer, regardless of duration or period of absence, and
Assistant Provincial/City/Municipal Treasurer, exceeding seven (7) days,
shall be approved by the concerned BLGF Regional Director. In the case of
NCR Treasurers, all applications for leave of absence shall be approved by
the BLGF Executive Director.
2. Where the applicant intends to leave the country, the application for leave
and the issuance of travel authority shall be approved by the BLGF Executive
Director, regardless of the duration, subject to the guidelines set by the DOF
and other existing policies, rules and regulations on foreign travel.
3. Application for leave of Provincial/City/Municipal Treasurer exceeding seven

(7) days, shall be supported by a request from the LCE concerned for the
designation of an Acting or OIC Treasurer. Likewise, the LCE concerned
shall recommend the approval of said application for leave.
47

LTOM, 2nd EDITION
4. Application for leave of absence of Assistant Provincial/City/Municipal

Treasurer for a period of seven (7) days, and below shall be approved by
the Provincial/City/Municipal Treasurer, a copy of which shall be furnished the
BLGF Regional Director for proper information.
B. Provincial/City/Municipal Treasurer and Assistant Treasurer shall be entitled to

special privilege leave (SPL) as mandated under existing laws (Sec. 21, Rule XVI,
Omnibus Rules Implementing Book V of EO No. 292). Likewise, Provincial/City/
Municipal Treasurer and Assistant Treasurer may avail of paternity leave of not
more than seven (7) days which shall be non-cumulative and non-commutative,
immediately before, during or after the childbirth or miscarriage of their legitimate
spouse. (Sec. 20, Omnibus Rules Implementing Book V of EO No. 292, as
amended by CSC Memorandum Circular No. 41, s. 1998)
1. The SPL to which the Provincial/City/Municipal Treasurer and Assistant

Provincial/City/Municipal Treasurer shall be entitled to are the following:
a. Funeral/Mourning Leave
b. Graduation Leave
c. Enrollment Leave
d. Wedding/Anniversary Leave
e. Birthday Leave
f. Hospitalization Leave
g. Accident Leave
h. Relocation Leave
i. Government Transaction Leave
j. Calamity Leave
A maximum of three (3) days within a calendar year or a combination of the

special leave privileges of their choice may be availed of by the Provincial/
City/ Municipal Treasurer and the Assistant Provincial/ City/ Municipal
Treasurer. The SPL may be availed of by the Provincial/City/ Municipal
Treasurer and the Assistant Treasurer when the occasion is personal to
them or that of their immediate family members.
In addition to the above special privileges, a Provincial/City/Municipal

Treasurer or an Assistant Treasurer may also avail of the Parental Leave to
Solo Parents in accordance with CSC Memorandum Circular No. 08, s.2004.
Such leave refers to leave benefits granted to a solo parent to enable said
parent to perform parental duties and responsibilities, with respect to minor
children, where physical presence is required. The parental leave of seven
(7) days can be availed of every year on a staggered or continuous basis,
and is not convertible to cash unless specifically agreed upon previously,
provided the solo parent has rendered at least one (1) year government
service, whether continuous or broken, reckoned from the effectivity of
Republic Act 8972. (“An Act Providing for Benefits and Privileges to Solo
Parents and their Children”, 22 September 2002)
Maternity Leave. Under CSC Memorandum Circular No. 25, s.2010,

qualified female treasurers, regardless of age and civil status, may also
48

avail of the special leave benefits provided for women who have undergone
surgery caused by gynecological disorders, pursuant to the provisions
and implementing rules and regulations of Republic Act No. 9710 (An Act
Providing for the Magna Carta of Women). This special leave may be availed
for every instance of gynecological disorder requiring surgery for a maximum
period of two (2) months per year, with full pay based on her gross monthly
compensation, provided that such treasurer has rendered at least six (6)
months aggregate service in any or various government agencies for the last
twelve (12) months prior to undergoing surgery for gynecological disorder.
2. Whenever a Provincial/City/Municipal Treasurer or an Assistant Treasurer

retires, voluntarily resigns, or is allowed to resign, or is separated from
the service through no fault of his/her own, he/she shall be entitled to the
commutation of all accumulated vacation leave and/or sick leave to his/her
credit, exclusive of Saturdays, Sundays and holidays, without limitation as
to the number of days of vacation leave and sick leave that he/she may
accumulate provided his/her leave benefits are not covered by special law.
(Sec. 26, Rule XVI, Omnibus Rules Implementing Book V of EO No. 292,
as amended by CSC Memorandum Circular No. 41, s. 1998)
3. When a Provincial/City/Municipal Treasurer or an Assistant Provincial/ City/

Municipal Treasurer whose leave credits have been commuted following his/
her separation from the service is re-employed in the Government before
the expiration of the leave commuted, he/she shall no longer refund the
money value of the unexpired portion of his/her leave. Insofar as his/her
leave credit is concerned, he/she shall start from a zero balance in his/her
new government office. (Sec. 26, Rule XVI of Omnibus Rules Implementing
Book V, E. O. No. 292, as amended by CSC Memorandum Circular No. 41,
s. 1998)
4. A Provincial/City/Municipal Treasurer or an Assistant Provincial/ City/

Municipal Treasurer who has accumulated at least fifteen (15) days’
vacation leave credits shall be allowed to monetize a minimum often (10)
days; provided, that at least five (5) days are retained after monetization
and, provided further, that a maximum of thirty (30) days may be monetized in
a given year. (Sec. 22, Rule XVI of Omnibus Rules Implementing Book V,
EO No. 292, as amended by CSC Memorandum Circular No. 41, s. 1998)

Municipal Treasurer may be allowed to monetize fifty percent (50%) or more
of his/her accumulated vacation or sick leave credits for valid and justifiable
reasons such as the following:
a. Health, medical and hospital needs of the Provincial/City/ Municipal

Treasurer or the Assistant Provincial/City/Municipal Treasurer or
the immediate members of his/her family;
b. Financial aid or assistance brought about by force majeure events

such as calamities, typhoons, fire, earthquakes and accidents;
49

LTOM, 2nd EDITION
c. Educational needs of the Provincial/City/Municipal Treasurer or

the Assistant Provincial/City/Municipal Treasurer or the immediate
members of his/her family;
d. Payment for mortgages and loans entered into for the benefit
of the Provincial/City/Municipal Treasurer or Assistant Provincial/
City/Municipal Treasurer or the immediate members of his/her
family; and
e. Extreme financial needs of the Provincial/City/Municipal Treasurer

or Assistant Provincial/City/Municipal Treasurer or the immediate
members of his/her family to fulfil basic needs for food, shelter and
clothing.
6. The monetization of fifty percent (50%) or more of the accumulated leave

credits shall be upon the favorable recommendation of the LCE and subject
to availability of funds. (Sec. 23, Omnibus Rules Implementing Book V,
E. O. No. 292, as amended by CSC Memorandum Circular No. 41, s. 1998)

Municipal Treasurer with ten (10) days or more vacation leave credits shall
be required to go on vacation leave whether continuous or intermittent for
a minimum of five (5) working days annually. (Sec. 25, Omnibus Rules
Implementing Book V, E. O. No. 292, as amended by CSC Memorandum
Circular No. 41, s. 1998)
SECTION 17. AUTHORITY TO TRAVEL ABROAD

AND PARTICIPATE IN TRAINING PROGRAMS
A. The conduct of capacity development programs for local treasurers and their
participation thereof, shall be subject to an authority issued by the BLGF/DOF
upon review and evaluation of the training design submitted by the concerned
organizer. The concerned treasurer, however, should seek permission from the
LCE for his/her attendance. The local treasurer may designate a caretaker of the
treasury office, only with the function of overseeing the day to day operations of
the office during his/her absence.
B. A local treasurer who intends to travel abroad, or leave the country, either
on a personal or official business, shall be required to secure an authority to
travel abroad from the BLGF Central Office, subject to an indorsement by the
concerned Regional Office. (Department Special Personnel Order No. 001.2018,
9 November 2018)
The following documents shall be submitted at least thirty (30) days prior to the
intended schedule of travel:
1. Letter request stating the destination and purpose of travel;
2. Certification that applicant has no pending administrative/criminal

complaint/ case (Issued by the BLGF Central and Regional Office);
50

3. For personal travel abroad, approved leave of absence (CSC Form No. 6)
for the duration of said travel, recommended by the Local Chief Executive
and approved by the BLGF Regional Director/Executive Director;
4. For official travel abroad:
a. Invitation from the concerned event sponsor; or

b. Authority from the LCE for the local treasurer’s participation to the
event;
5. Sworn statement duly notarized indicating the estimated expenses of the

travel and how it will be financed;
6. Sworn statement of sponsoring party in case expenses are not to the

account of the local treasurer.
7. Clearance from money, property and work-related accountabilities (CSC

Form No. 7, s. 2017);
8. Certified true copy of applicant’s latest statement of assets, liabilities and

net worth; and
9. Recommendation of the Municipal Mayor as to who will be designated

as OIC/ICO of the Municipal Treasury Office.
51

SECTION 18. SCOPE AND NATURE

A. Administrative and Technical Supervision by the BLGF.
1. The BLGF shall exercise administrative and technical supervision and

coordination over the treasury and assessment operations of local
governments [Sec. 43 (b), EO No. 127]. It shall provide consultative
services and technical assistance to local treasurers in the implementation
of programs, policies and regulations on local fiscal matters such as local
taxation, local revenue mobilization, and real property assessment as well
as administrative matters on the recruitment, selection and appointment of
Local Treasurers and Assistant Local Treasurers.
2. The functions and authorities of the Secretary of Finance over local treasurers
and assistant treasurers delegated upon the BLGF under Department
Special Order No. 01.2018 as provided under Annex 5.
3. Administrative Supervision
a. Process appointments of Local Treasurers and Assistant Treasurers

and other personnel actions such as promotion, designation, detail,
secondment, transfer, retirement, and extension of service, subject to
existing CSC rules and regulations.
b. Act on leave of absence filed.
c. Issuance of Authority for foreign Travel of Local Treasurers and

Assistant Local Treasurers either on Official or Personal purpose.
d. Act on complaints and enforce administrative disciplinary action

against Local Treasurers and Assistant Local Treasurers:
i. Initiate and act on complaints;
ii. Conduct fact-finding and preliminary investigation;
iii. File formal charges, if warranted and authorized by the

Secretary of Finance;
iv. Recommend the imposition of administrative disciplinary

sanctions upon erring treasurers; and
v. Implement decisions/resolutions/orders of judicial and quasi

judicial bodies against local treasurers.
e. Conduct training programs, seminars, workshops and other allied

activities for the improvement of the administrative skills in the local
treasury offices.
52

4. Technical Supervision
a. Supervise and coordinate the conduct of Local Treasury and

Assessment Operations of Provinces, Cities and Municipalities within
the region for the proper implementation of laws, decrees, rules,
regulations and administrative issuances of the DOF;
b. Coordinate the plans, programs and activities of local treasury and

assessment offices in the conduct of tax collection drives and tax
information and education campaigns;
c. Conduct regional training programs, seminars, workshops and other

allied activities for the improvement of the technical skills in the local
treasury offices;
d. Monitor and determine the efficiency and effectiveness of the internal

control system of the office of the Provincial/City/Municipal Treasurer;
e. Monitor the performance of revenue generation in RPT, Business Tax

and non-tax revenues;
f. Conduct revenue and treasury operations evaluation to determine

the compliance by Local Treasurers with applicable laws, rules and
regulations;
g. Monitor the implementation by LGUs of national and local tax

ordinances and tax measures; and
h. Review, evaluate, and monitor the timely and accurate submission of

LGU financial and fiscal reports for the purpose of target-setting and
policy formulation.
B. Technical Supervision by Provincial Treasurer Over Municipal and

Component City Treasurers.
1. Municipal Treasury Offices. The Provincial Treasurer shall:
a. Conduct treasury operations evaluation over treasury offices;
b. Monitor all eSRE reports uploaded by municipal treasurers to the eSRE

Web Information System, and shall review, analyze and approve/reject
the reports within fifteen (15) days from the prescribed periods set for
the local treasurers;
c. Exercise the authority to review and examine on a continuing basis

real property tax record to ensure the proper implementation hereof
and determine compliance with existing laws and regulations; (Art.
291, IRR, Implementing Sec. 200, LGC)
d. Provide technical consultative services such as mentoring, coaching,

trainings, among others; and
e. Perform such other functions as may be provided by law and regulations

of DOF and BLGF.
53

LTOM, 2nd EDITION
2. Component City Treasury Offices. The Provincial Treasurer shall:
a. Provide technical consultative services such as mentoring, coaching,

trainings, among others;
b. Conduct treasury operations evaluation with respect to the imposition,

collection and sharing on tax, sand, gravel and other quarry resources,
as maybe applicable; and
c. Perform such other functions as may be provided by law, and rules

and regulations of DOF and BLGF.
SECTION 19. FISCAL PERFORMANCE MONITORING OF LGUS

AND LOCAL TREASURERS
A. Conduct of Local Treasury Operations Evaluation
1. The BLGF shall regularly conduct efficient and effective evaluations of local
treasury operations of all provinces, cities and municipalities to ensure
compliance with applicable laws, rules and regulations, and to provide the
necessary technical assistance for the purpose.
2. The BLGF Central Office shall conduct local treasury operations evaluation
within Metro Manila and other LGUs outside Metro Manila, when necessary.
3. In the case of the Regional Offices, evaluation shall be conducted within

the provinces and cities, including municipalities in coordination with the
Province.
B. Local Government Unit (LGU) Fiscal Sustainability Scorecard (FSS)
1. In orderto improve the revenue collection efficiency of all LGUs, optimize their
income generation mandates under the LGC, enjoin good fiscal governance
at all levels, and promote openness and transparency in local fiscal and
financial management, the LGU FSS is established as per Department
Order No. 075.2018 dated 20 December 2018 to be the regular evaluation
and assessment tool of the Bureau for the LGUs. The LGU FSS is issued in
orderto: (1) regularly assess individual LGU fiscal and financial performance;
(2) provide comprehensive metrics and data analytics on local finance; (3)
support credit financing assessment; (4) assist in local and national policy
formulation; and (5) encourage the development of appropriate rewards
system.
2. The LGU FSS shall cover all provinces, cities and municipalities, and shall
be regularly developed and updated by the BLGF as part of its regular
programs to build and sustain good fiscal governance by LGUs.
3. The primary data sources shall be the SRE and QRRPA reports submitted
by the Local Treasurers and Assessors, respectively. Additional official
references shall be considered in regard to benchmarks and reporting
54

compliance requirements, such as population data and growth rate , SMV

ordinance, among others.
4. The Local Government Financial Performance Management System

(LGFPMS) prescribed by the BLGF under Memorandum Circular (MC) No.
16-2015, dated 19 June 2015, shall serve as a guide in establishing a fiscal
and financial performance framework in processing the LGU FSS. (Annex
5)
5. The parameters for evaluation for the Financial or Quantitative Indicators

and for Non-Financial or Qualitative Indicators are discussed in details in
Annex 6.
C. Performance Standards for Local Treasurers and Assistant Local Treasurers
1. The Performance Standards and Evaluation System for Local Treasurers

referred to as “Performance Standards” is established to set the criteria
and system on the regular performance appraisal of Local Treasurers and
Assistant Local Treasurers with the end goal of evaluating the level of
competency, professionalism and productivity of all Local Treasurers. This
is to ensure that their knowledge, skill sets, and strategies are attuned to the
strategic directions and priorities, particularly on local government fiscal and
financial management, of the Department of Finance.
2. The Performance Standards shall be an integral part of the human resource

management and development strategy of the Department to build and
sustain a results-oriented performance and professional culture among
Local Treasurers and Assistant Local Treasurers. As such, it shall be used
as basis for purposes of appointment and other personnel action, such as
promotion, renewal of designation, and extension of service, accountability
assessment, awards and recognitions, capacity building interventions,
among others, pursuant to existing rules and regulations.
3. There shall be a regular monitoring and performance evaluation of all Local

Treasurers and Assistant Local Treasurers, to be based on objectively
verifiable indicators and established guidelines, supported by appropriate
management and information systems, and to be undertaken by the BLGF in
a transparent, impartial, open, and synchronized process. Local Treasurers
and Assistant Local Treasurers who fail to meet the minimum standards
shall be given assistance to improve. If the performance of a Local Treasurer
or Assistant Local Treasurer remains unacceptable, despite the opportunity
given, the BLGF shall institute the appropriate administrative action. In no
case shall these performance standards and guidelines engender solicitation
of favors or impose undue patronage on Local Treasurers, Assistant
Treasurers or any officials and employees of the Department.
4. The policy to undertake a regular performance evaluation through

Performance Standards shall apply to all provincial, city, and municipal
treasurers and assistant treasurers, whether permanent or designate.

LTOM, 2nd EDITION
5. The parameters for evaluation for the Performance Standards are discussed
in details under Department Order No. 006.2015 dated 20 January 2015
(Annex 8).
SECTION 20. TURN OVER OF ACCOUNTABILITIES TO THE

INCOMING AND OUT GOING LOCAL TREASURERS
The following steps and procedures shall be undertaken in the turn-over of
accountabilities between the incoming and outgoing local treasurer due to retirement,
resignation, leave of absence, relief, transfer or detail to other offices:
A. Closing of Books Preparatory to Transfer of Accountabilities
1. Before the transfer of accountabilities is effected, all the books and accounts
shall be completely written up to date, including supplies adjustment, as well
as reports on accountable forms and cashbooks.
2. The cashbooks shall then be totaled and closed as of the date of transfer
and ruled off and certified by the outgoing treasurer, showing the balance as
per book and the amount transferred to his/her successor. The successor
shall also certify therein acknowledging the amount actually received by him/
her from his/her predecessor.
3. All cash and cash items, checks, certificate of time deposit, stock certificates
shall be counted and listed in an inventory showing the denomination of
each kind of money.
4. The inventory of checks shall also show their respective serial numbers,
date, amount and name of the payee and of the bank on which they are
drawn.
5. Investment certificates like time deposits, treasury bills and stock certificates
shall be inventoried showing their serial numbers and amounts and kind of
investment. This inventory of cash and other cash items shall be compared
with the cashbook balances.
B. Preparation of Invoice-Receipts
1. The outgoing officer shall prepare the invoice-receipts (please see

Attachment “A”) in quadruplicate covering his/her entire accountability for
money, property, unused accountable forms and unissued blank checks.
The accomplished invoice-receipts shall then be submitted, viz:
a. Provincial/City/Municipal Auditor
b. Incoming Provincial/City/Municipal Treasurer
c. Out-going Provincial/City/Municipal Treasurer
d. Provincial/City/Municipal Treasury Office
Each invoice receipt shall bear the following certificate at the bottom of
each sheet:
56

I hereby certify that I have this____ day of_________________________ ,

transferred to my successor, Mr./Ms.__________________________ the items
described above, as of_________ , the date of transfer of accountabilities.
Outgoing P/C/M Treasurer
Date
I hereby certify that I have this_____ day of_____________________ , actually

received from my predecessor, Mr./Ms.________________________________
all the items described above, as of____________________ , the date of
transfer of accountability, except______________________________________
Incoming P/C/M Treasurer
Date
2. In the case of property, complete detailed inventories shall be made on

the regular form prescribed therefor in the Acknowledgment Receipt for
Equipment (ARE). The inventories, appropriately worded and receipted
for, shall serve as the invoice-receipts. The invoice-receipts covering
accountable forms shall be made on the regular form of CRAAF. The various
accountable forms in the hands of other accountable officers, which cannot
actually be counted by the incoming Treasurer shall also be transferred to
him/her, supported by the corresponding RAAF held by accountable officer
which were last submitted, duly signed by them.
3. All other important documents such as stock certificates, certificates of time

deposits, treasury bills, duplicate combination of accountable officers’ safes,
etc., pertaining to the Office which are not included in the inventory above
mentioned must also be listed and invoiced by the outgoing officer and
receipted for by the incoming officer.
C. Advice of Transfer and Settlement of Account:
Provincial, City and Municipal Treasurers shall advise their corresponding

Provincial, City and Municipal Auditors in advance of the actual date of their
relinquishment of Office due to retirement, resignation, leave of absence, relief,
transfer or detail to other Offices, so as to enable their resident Auditors to give
preference to the audit of the Treasurer’s accounts over other work/ activities
and to give such officers an opportunity to adjust the differences found in the
settlement of accounts before actually effecting the transfer of accountability.
57

LTOM, 2nd EDITION
ATTACHMENT A
INVOICE RECEIPT OF TRANSFER OF ACCOUNTABILITIES

Province/City/Municipality of_____________________________
I. DEPOSITORY OF ACCOUNTS Amount Total

A. CASH IN TREASURY/CASH IN VAULT
GENERAL FUND Php
TRUST FUND Php
SPECIAL EDUCATION FUND Php
SPECIAL ACCOUNTS (use separate sheet if necessary) Php
Php
B. CASH IN BANK
GENERAL FUND Php
TRUST FUND Php
SPECIAL EDUCATION FUND Php
SPECIAL ACCOUNTS (use separate sheet if necessary) Php
Php
II. INVESTMENT ACCOUNTS
A. CERTIFICATE OF TIME DEPOSITS
Dilate °L. Security Term/Rate Maturity

Principal
Placement 3 Date
Php
-use separate sheet if necessary-

B. TREASURY BILLS
Date of Placement Term/Rate Maturity

C. STOCK CERTIFICATES
Name of Stock Certificate No. No. of Shares Amount
______________ __________________ ________________ Php __________________

111. ACCOUNTABLE FORMS
A. ACCOUNTABLE FORMS (WITH AND WITHOUT MONEY VALUE)
Serial Numbers
To From
Accountable Form No. 51
Community Tax Certificate (Individual)
Community Tax Certificate (Corporation)
Cash Tickets ____________________ ____________
Parking Tickets ____________________ ____________
Other Accountable Forms: (please specify)
58

B. BLANK UNISSUED CHECKS
Servicing Bank Account Number Serial Numbers

GENERAL FUND
TRUST FUND
SPECIAL EDUCATION FUND
SPECIAL ACCOUNTS
IV. OTHERS
A. OUTSTANDING CHECKS
Check Number Payee Amount

GENERAL FUND
TRUST FUND
SPECIAL EDUCATION FUND
SPECIAL ACCOUNTS
CERTIFICATION
I hereby certify that I have this day of I hereby certify that I have this day of
transferred to my successor, actually received from my
Mr./Ms._____________________________ predecessor,
, all the items described above Mr./Ms.____________________________
as, the date of the transfer of , all the items described above as
accountability. of, the date of the transfer of
accountability.
Outgoing Provincial/City/Municipal Incoming Provincial/City/Municipal Treasurer

Treasurer
SIGNED IN THE PRESENCE OF:
COA REPRESENTATIVE BLGF REPRESENTATIVE
(BLGF Memorandum Circular No. 03-2007, 05 March 2007)
59

ROLES, DUTIES, AND RESPONSIBILITIES
OF THE LOCAL TREASURER
SECTION 21. POWERS AND DUTIES OF LOCAL TREASURER

The Local Treasurer shall take charge of the Local Treasury Office and perform the
following duties and functions:
A. Collect all local taxes, fees and charges directly or through their duly authorized
deputies (Sec. 170, LGC);
B. Advise the Governor or Mayor, as the case may be, the sanggunian, and other
local government and national officials concerned regarding disposition of local
government funds, and on such other matters relative to publicfinance;
C. Take custody and exercise proper management of the funds of the LGU
concerned;
D. Take charge of the disbursement of all local government funds and such other
funds the custody of which may be entrusted to him/her by law or other competent
authority;
E. Inspect private commercial and industrial establishments within the jurisdiction of

the LGU concerned in relation to the implementation of tax ordinances, pursuant
to the provisions under Book II of the LGC;
F. Maintain and update the tax information system of the LGU;
G. In the case of the Provincial Treasurer, exercise technical supervision over all
treasury offices of component cities and municipalities; and
H. Exercise such other powers and perform such other duties and functions as may
be prescribed by law or ordinance.
(Sec. 470, LGC)
I. Specific Functions
1. Certify as to the Availability of Funds. No money shall be disbursed

unless the local budget officer certifies to the existence of the appropriation
that has been legally made for the purpose, the local accountant has
obligated said appropriation, and the local treasurer certifies the availability
of funds for the purpose.19 It is the primary duty of the local treasurer to
certify to the availability of funds prior to all disbursements from the local
treasury, in conjunction with the certification of the local budget officer on the
existence of an appropriation for the purpose and the certification of the local
accountant on the obligation for the appropriation.
19 Sec. 344, LGC
60

ROLES, DUTIES, AND RESPONSIBILITIES OF THE LOCAL TREASURER
2. Implement Tax Collection and Enforcement Program. The Local

Treasurer is vested by law to collect and receive all monies accruing to
their respective jurisdictions whether in the form of collectible taxes and other
revenues or trust funds pertaining to other branches or units of government.
3. Prepare and Submit Reports. The Local Treasurer shall prepare and submit
daily report of collections, with the supporting document. Likewise, the Local
Treasurer shall accomplish and submit quarterly reports of Statement of
Receipts and Expenditures (SRE) prescribed under DOF DO No. 034.2014,
dated 26 May 2014, and other reports in forms prescribed by the BLGF/DOF.
4. Certify RPT Delinquencies Remaining Uncollected. The provincial, city

or municipal treasurers or his/her deputy shall prepare a certified list of all
real property tax delinquencies which remained uncollected or unpaid for
at least one (1) year in his/her jurisdiction, and a statement of the reason
for such non-collection or non-payment and shall submit the same to the
sanggunian concerned on or before the thirty-first (31st) of December of
the year immediately succeeding the year in which the delinquencies were
incurred, with a request for assistance in the enforcement of the remedies for
collection provided in the LGC. (Sec. 269, LGC)
5. Examine the Books of Accounts and Pertinent Records of Businessmen.

The provincial, city, municipal or barangay treasurer may by himself/herself
or through any of his/her deputies duly authorized in writing, examine the
books, accounts, and other pertinent records of any person, partnership,
corporation, or association subject to local taxes, fees and charges in order
to ascertain, asses, and collect the correct amount of the tax, fee, or charge.
Such examination shall be made during regular business hours, only once
for every tax period, and shall be certified to by the examining official. Such
certificate shall be made of record in the books of accounts of the taxpayer
examined.
In case the examination herein authorized is made by a duly authorized

deputy of the local treasurer, the written authority of the deputy concerned
shall specifically state the name, address, and business of the taxpayer
whose books, accounts, and pertinent records are to be examined, the
date and place of such examination, and the procedure to be followed in
conducting the same.
For this purpose, the records of the revenue district office of the Bureau of
Internal Revenue (BIR) shall be made available to the local treasurer, his
deputy or duly authorized representative. (Sec. 171, LGC)
6. Designate the Barangay Treasurer as his/her Deputy to Collect Local

Taxes, Fee and Charges. The provincial, city and municipal treasurer may
designate the barangay treasurer as his deputy to collect local taxes, fees
or charges. In case a bond is required for the purpose, the provincial, city
or municipal government shall pay the premiums of the bond that may be
required under the LGC. (Sec. 170, LGC)
61

LTOM, 2nd EDITION
7. Submit Certified Statement Covering Income and Expenditures.

The Local Treasurer shall submit, on or before the fifteenth (15th) day of
July each year, to the LCE a certified statement covering the income and
expenditures of the preceding fiscal year, the actual income and expenditures
of the first two (2) quarters of the current year and the estimated income and
expenditures for the last two (2) quarters ofthe current year. All statements
of income and expenditure shall be jointly certified by the Local Treasurer
and the Local Accountant.
8. Issue a Certified Statement Covering Actual Income. On or before the fifth

(5th) day of September each year, the City or Municipal Treasurer, jointly with
the City or Municipal Accountant, shall issue a certified statement covering
the actual income of the past year, estimates of income of the current and
ensuing fiscal years from local sources, for the barangay concerned. Based
on such certified statement, the barangay treasurer shall submit, on or before
the fifteenth (15th) day of September each year, to the punong barangay a
statement covering the estimates of income and expenditures for the past,
current and ensuring fiscal years. [Art. 423 (b), IRR, LGC]
Upon receipt ofthe statement of income and expenditures from the barangay
treasurer, the punong barangay shall prepare the barangay budget for the
ensuing fiscal year in the manner and within the period prescribed in the
implementing barangay budget to the sangguniang barangay for enactment.
[Art. 423 (c), IRR, LGC]
9. Keep Full Sets of Secondary Standards for Use in the Testing of

Weights and Measures. On the sealing of weights and measures, Municipal
Treasurers shall keep full sets of secondary standards in their offices for use
in the testing of weights and measures. These secondary standards shall
be compared with the fundamental standards of the Department of Science
and Technology (DOST) at least once a year. The sealing and licensing of
weights and measures shall be the duty of the Municipal Treasurer and their
deputies. In case of violation, fraudulent practices and unlawful possession
or use of instruments of weights and measures, shall settle an offense
involving the commission of fraud before a case therefore is filed in court,
upon payment of a compromise penalty of not less than Two Hundred Pesos
(Php200.00). [Sec. 148 (b), LGC]
10. Register in a Book All Branded and Counter Branded Animals. On

cattle registration, the Municipal Treasurer shall register in a book properly
prepared and kept for the purpose, all branded and counter branded animals
presented for registry, and shall enter the name and residence of the owner,
and the class, color, sex, age, brand, knots of radiated hair and other marks
of identification of the cattle registered. The original registry entry and the
copy thereof issued as a certificate of ownership shall be signed by the
owner and the Municipal Secretary.20
20 Sec. 517, Revised Administrative Code ofthe Philippines
62

Upon every transfer of large cattle, the Municipal Treasurer shall issue to
the purchaser of the animal a certificate of transfer showing the name and
residence of the owner/vendor, name and residence of the buyer, purchase
price, identification marks of the animal and the reference to the original
certificate of ownership by number and the name of municipality which
issued the certificate.
11. Ensure that Payment of Taxes of a Business is not avoided through

Simulation of the Retirement thereof and Recommend to the Mayor for
the Disapproval of the Application for the Termination or Retirement
of the Business. The Local Treasurer shall ensure that the payment of
taxes of a business is not avoided through simulation of the termination or
retirement thereof. For this purpose, the Local Treasurer shall observe as
follows:
a. Assign every application forthe termination or retirement of a business

to an inspector from the Local Treasury Office who shall proceed to the
address on record of the business to verify if it is no longeroperating.
If the inspector finds that the business is simply placed under a new
name, manager and/or a new owner, the Local Treasurer concerned
shall recommend to the LCE for the disapproval of the application for
termination or retirement of the business. Accordingly, the business
shall continue to be liable forthe payment of all taxes, fees and charges
imposed thereon under existing local tax ordinances; and
b. In the case of a new owner to whom the business was transferred

by sale or other form of conveyance, said new owner shall be liable to
pay the tax or fee for the transfer to him/her of the business if there
is an existing ordinance prescribing such transfer tax.21
12. Attend Sessions of the Sanggunian. The Local Treasurer, when required
and upon prior approval of the LCE, shall attend the sessions of the
sanggunian. [Sec. 470(e), LGC]
13. Exercise Such Other Powers and Functions and Perform Such Other
Duties and Responsibilities. The Local Treasurer shall exercise such other
powers and functions and perform such other duties and responsibilities as
may be prescribed by law or ordinance, as follows:
a. Remittance of statutory obligations to the BIR; the Government

Service Insurance System (GSIS); Pag-ibig; PhilHealth obligations
and share of Metro Manila DevelopmentAuthority (MMDA) for LGUs in
Metro Manila.
b. Deputies of the National Government Alien Registration Fees.
c. Members of the following Local Committees and Boards:
i. Local Finance Committee
21 Art 241, IRR, LGC
63

LTOM, 2nd EDITION
ii. Local School Boards22
iii. Appraisal Committee (for purposes of expropriation and purchase

of real property)
d. In accordance with DBM guidelines, certify, along with the local Budget
Officer, Planning Development Officerand the Accountant, the Budget
of Expenditures and Sources of Financing to support the preparation
of the LGU’s annual budget which should include, among others, the
Programs/Projects/Activities (PPAs) on Gender and Development
(GAD) pursuant to RA No. 7192,23 RA No. 971024 and Philippine
Commission on Women (PCW)-Department of Interior and Local
Government (DILG)-DBM-NEDA JMC No. 2016-01 dated 12 January
2016.25
e. The local treasurer must ensure that the requirements of Sec. 13 of RA

10173 (Data Privacy Act of 2012) and Sec. 5 of its Implementing Rules
and Regulations are observed. Specifically, if needed, the processing
of personal information will only be done to carry out the functions of
public authority as provided for by the LGC.
The principles of transparency, legitimate purpose and proportionality

must be observed in undertaking the publication of List of Delinquency
in the payment of the Real Property Tax and in Advertisement and
Sale under Secs. 254 and 260, respectively, of the LGC.
In order to protect the rights of the taxpayers, the local treasurer must
see to it that no personal data are included in all publications of notices.
J. Role of the Local Treasurer in Local Government Enterprise Operations.

The local treasurer of the LGU operating a public enterprise shall have the
following functions in its establishment and operations:
1. Advise the LCE, the sanggunian, in the management of the public enterprise
on its financing aspects;
2. Advise the sanggunian in the enactment of ordinances on public enterprises,

especially in relation to their financial management;
3. Take charge of the collections and take custody of funds of all government
enterprises;
NOTE
The foregoing provisions of RA No. 7160 or the LGC state clearly that the
collection of local taxes, fees and charges is the duty and function of the local
treasurer, thus, primarily accountable therefor. However, considering the
multifarious duties and functions of the local treasurer and the impossibility
22 Sec. 98 (a), LGC

23 Women in Development and Nation Building Act
24 The Magna Carta of Women
25 Amendments to Philippine Commission on Women-DILG-DBM-NEDA JMC No. 2013-01 Guidelines on the Localization of the
Magna Carta of Women
64

NOTE
of being able to attend to all taxpayers coming to the treasury office, the
aforecited provisions of the same Code likewise allow the local treasurer to
authorize deputies to perform such collection function. This goes without
saying that the deputies to be authorized must be permanent appointees
in the Local Treasury Office and properly bonded. It is very important that
anyone deputized by the local treasurer to collect must be under the direct
supervision of said local official being the ultimate accountable officer for
local funds. (BLGF 2nd Indorsement, 19 December 2010)
Accepted definition of a duly authorized deputy is that “a person who is

given the authority to stand in the place of another”. Such authorization shall
be expressly detailed in writing in order to establish properly the duties/
responsibilities of the person acting as deputy, xxx.
xxx... the primary mandate of the City Treasurer is the custody of and
exercise of proper management of the funds of the local government unit
concerned. This includes collections received from its economic enterprises’
operations. Therefore, he should have supervision and monitoring of treasury
operations since he is the primary accountable officer for all funds received
as well as the usage of all accountable forms issued by the City. (COA RO
No. XI, AOM No. 2017-024, 15 December 2017)
4. Ensure that payments are made on duly certified and approved disbursement
vouchers;
5. Advise the LCE of delinquencies of government enterprise clientele

for purposes of enforcing sanctions and taking the necessary remedial
measures;
6. Recommend qualified persons for designation as collectors;
7. Maintain records of payments of market stall holders and of other government

enterprise’s lessors;
8. Prepare periodic financial reports for each government enterprise as required

by BLGF rules and regulations;
K. Duties and Responsibilities of Local Treasurers Relative to Credit Financing.

Local Treasurers have the following duties and responsibilities that relate to the
powers of LGUs to use credit financing, indebtedness and alternative sources of
funds:
1. Act as the custodian of all funds directly released to the LGU from the
proceeds of grants and from loans, credits and other forms of indebtedness,
as well as income and express profits derived from the operations of the
projects financed from them. He/she shall deposit these funds in a separate
depository account in the name of the LGU with banks, preferably government
owned, located in or nearest to the area of jurisdiction of the LGU;
65

LTOM, 2nd EDITION
2. Prepare the required reports of checks issued, disbursements and other

accountabilities;
3. In coordination with other LGU official concerned, ensure that the debt
servicing for the LGU credit does not exceed twenty percent (20%) of its
annual regular income for each year until the loan is fully paid [Sec. 324 (b),
LGC];
4. Pay or amortize loans, including all interests incurred, as appropriate from

the income of the projects or services and/or from the regular income of the
LGUs until fully paid; and
5. Upon authorization of the sanggunian concerned, Local Treasurers shall:
a. Establish a Sinking Fund for the re-payment of bond issues or maintain

Trust Funds for the purpose;
b. Maintain special accounts in the General Fund for loans, interest,

bond issues, and receipts arising from BOT transactions, such as toll
fees, charges, and other mandatory contributions for specific purposes
(Sec. 313, LGC);
c. Maintain separate records of funds received for projects financed by

proceeds of loans, credits, grants, and other forms of financing to keep
track of the cash flow of the project fund; and
d. If required, provide financial data about the LGU that may be needed
in relation to its availment of the funding sources and mechanisms.
The Assistant Local Treasurer shall have the following functions and responsibilities:
A. The assistant local treasurer shall assist the treasurer and perform such duties
as the latter may assign to him/her. He/she shall have authority to administer
oaths concerning notices and notifications to those delinquent in the payment of
real property tax and concerning official matters relating to the accounts of the
treasurer or otherwise arising in the offices of the treasurer and the assessor.
[Sec. 471(c), LGC]
B. In case of the absence of the Local Treasurer, the Assistant Local Treasurer may
automatically perform the functions of the former, as provided under Sec. 10.a
hereof.
66

SECTION 22. THE LOCAL TREASURER’S ROLE IN BOARDS

AND COMMITTEES CREATED PURSUANT
TO THE LGC AND OTHER LAWS
A. Local Finance Committee (LFC)
1. It is mandatory for every province, city, or municipality to create an LFC

which shall be composed of thefollowing:
a. Local Treasurer
b. Local Planning and Development Officer
c. Local Budget Officer
2. The LFC shall exercise the following functions:
a. Determine the income reasonably projected as collectible for the

ensuing fiscal year;
b. Recommend the appropriate tax and other revenue measures or

borrowings which may be appropriate to support the budget;
c. Recommend to the LCE concerned the level of the annual expenditures

and the ceilings of spending for economic, social and general services
based on the approved local development plans;
d. Recommend to the LCE concerned the properallocation of expenditures

for each development activity between current operating expenditures
and capital outlays;
e. Recommend to the LCE concerned the amount to be allocated for

capital outlay under each development activity or infrastructure project;
f. Assist the sangguniang panlalawigan in the review and evaluation of

budget of component cities and municipalities in the case of provincial
finance committee, the barangay budgets in the case of city or
municipal finance committee, and recommend the appropriate action
thereon;
g. Assist the sanggunian concerned in the analysis and review of annual

regular and supplemental budgets of the respective LGU to determine
compliance with statutory and administrative requirements; and
h. Conduct semi-annual review and general examination of cost and

accomplishments against the performance standards applied in
undertaking development projects. A copy of this report shall be
furnished the LCE and the sanggunian concerned, and shall be posted
in conspicuous and publicly accessible places in the Provinces, Cities,
Municipalities and barangays.
(Sec. 316, LGC)
67

LTOM, 2nd EDITION
B. Local School Boards (LSB).There shall be established in every province, city, or

municipality a provincial, city, or municipal school board. The composition of the
LSB shall be as follows:
1. The Provincial School Board shall be composed of the governor and the
division superintendent of schools as Co-Chairpersons; the chairman of
the education committee of the sangguniang panlalawigan, the Provincial
Treasurer, the representative of the pederasyon ng mga sangguniang
kabataan in the sangguniang panlalawigan, the duly elected president of
the provincial federation of parents-teachers associations, the duly elected
representative of the teachers’ organizations in the province, and the duly
elected representative of the non-academic personnel of public schools in
the province, as members;
2. The City School Board shall be composed of the city mayor and the city
superintendent of schools as Co-Chairpersons; the chairperson of the
education committee of the sangguniang panlungsod, the City Treasurer,
the representative of the pederasyon ng mga sangguniang kabataan in the
sangguniang panlungsod, the duly elected president of the city federation
of parents-teachers associations, the duly elected representative of the
teachers’ organizations in the city, and the duly elected representative of the
non-academic personnel of public schools in the city, as members; and
3. The Municipal School Board shall be composed of the municipal mayor and
the district supervisor of schools as Co-Chairpersons; the chairman of the
education committee of the sangguniang bayan, the Municipal Treasurer,
the representative of the pederasyon ng mga sangguniang kabataan in the
sangguniang bayan, the duly elected president of the municipal federation of
parent-teacher associations, the duly elected representative of the teachers’
organizations in the municipality, and the duly elected representative of the
non-academic personnel of public schools in the municipality, as members.
[Sec. 98 (a) and (b), LGC]
The performance of the duties and responsibilities of the abovementioned

officials in their respective LSBs shall not be delegated. [Sec. 98 (d), LGC]
4. The Provincial, City and Municipal School Boards shall have the following
functions:
a. Determine, in accordance with the criteria set by the Department of

Education (DepEd), the annual supplementary budgetary needs for
the operation and maintenance of public schools within the province,
city, or municipality, as the case may be, and the supplementary local
cost of meeting such needs, which shall be reflected in the form of an
annual school board budget corresponding to its share of the proceeds
of the special levy on real property constituting the Special Education
Fund (SEF) and such other sources of revenue as the LGC and other
laws and ordinances may provide;
68

b. Authorize the Provincial, City or Municipal Treasurer, as the case may

be, to disburse funds from the SEF pursuant to the budget prepared
and in accordance with existing rules and regulations;
c. Serve as an advisory committee to the sanggunian concerned on

educational matters such as, but not limited to, the necessity and uses
of local appropriations for educational purposes;
d. Recommend changes in the names of public schools within the

territorial jurisdiction of the LGU for enactment by the sanggunian
concerned (Sec. 99, LGC); and
e. The Co-Chairpersons and Members of the Provincial, City or Municipal

School Board shall perform their duties as such without compensation
or remuneration. Members thereof who are not government officials
or employees shall be entitled to necessary travelling expenses and
allowances chargeable against the funds of the LSB concerned,
subject to existing accounting and auditing rules and regulations.
(Sec. 101, LGC)
C. Bids and Awards Committee (BAC).
In order that local treasurers and assistant local treasurers give utmost priority to
their primary duties in revenue generation, resource mobilization, disbursement,
and fund management, as provided under the LGC, and inasmuch as RA
9184 (Government Procurement Reform Act) do not require their mandatory
membership in the BAC and the Technical Working Group (TWG), relative to
the procurement of goods, consulting services and infrastructure projects, it is
directed that all local treasurers and assistant local treasurers, whether appointed
or designated, shall be prohibited from becoming regular members of the BAC
and TWG of LGUs. However, they may serve as provisional members when the
local treasury office is the end-user of the goods, services and projects that may
be subject of procurement.
To ensure that accountabilities in procurement and disbursement functions are

properly defined, all local treasurers and assistant local treasurers shall ensure
appropriate internal control therefor, particularly in certifying the availability of
funds before money shall be disbursed, including those for payment of procured
goods, service and projects.
(DOF Department Order No. 042.2019 dated June 12, 2019)
D. Committee on Appraisal
The City or Municipal Treasurer shall act as Chairman relative to distraint of

personal property, with a representative of the Commission on Audit and the city
or municipal assessor as member. (Sec. 175 (e), LGC)
69

LTOM, 2nd EDITION
SECTION 23. TREASURER’S ROLE IN NATIONAL AND LOCAL

ELECTIONS PURSUANT TO THE OMNIBUS
ELECTION CODE
A. Local Treasurers shall comply with applicable Resolutions issued by the
COMELEC every election period on election duties and functions, personnel
action, leave of absence, travel, among others, and shall be guided by the
applicable rules and regulations of the DOF and the BLGF.
B. The Municipal Treasurer shall be a member of the Municipal Board of

Canvassers. OIC Municipal Treasurer may not be appointed thereto. In the
case of Provincial/City Board of Canvassers, the Provincial or City Treasurer
may be appointed thereto as substitute members in case of non-availability,
absence, disqualification due to relationships or incapacity for any cause of
the regular member thereof.
70

CHAPTER BONDING OF LOCAL TREASURERS
SECTION 24. LEGAL BASIS FOR THE BONDING OF LOCALTREASURERS

Treasury Circular No. 02-2009 dated 06 August 2009, and revised Treasury Order
Nos. 01-95 and 01-99 issued by the Bureau of the Treasury (BTr), pertaining to
regulations promulgated for the effective bonding of accountable officers pursuant to
the provisions of the Public Bonding Law (PBL).
SECTION 25. GUIDELINES ON BONDING OF LOCAL TREASURERS

AND ACCOUNTABLE OFFICERS
A. Bonding of Local Treasurers and Accountable Officers.
1. Every officer of the LGU whose duties permit or require the possession or
custody of local funds shall be properly bonded, and such officer shall be
accountable and responsible for said funds and for the safekeeping thereof
in conformity with the provisions of law. [Sec. 305 (f), LGC] Each accountable
officer whose total cash accountability is not less than Php5,000 shall
be bonded. The amount of bond shall depend on the total accountability
of the officer as fixed by the HoA. An official or employee who has both
money and property accountability shall be bonded only once to cover both
accountabilities, but the amount of bond shall be in accordance with the
Schedule issued by the BTr. (COA Circular No. 2006-005, dated 13 July
2006)
2. Every officer, agent and employees of the Government of the Philippines or

of the companies or corporations of which the majority of the stock is held
by the National Government, regardless of the status of their appointment
shall, whenever the nature of the duties performed by such officer, agent or
employee permits or requires the possession, custody or control of funds or
properties for which he/she is accountable, be deemed a bondable officer
and shall be bonded or bondable and his/her fidelity insured.
A Barangay Treasurer shall be bonded in an amount of accountability to

be determined by the Sangguniang Barangay but the amount of maximum
bond shall not exceed Php10,000.00 as authorized by the LGC or at an
amount which may or hereinafter be prescribed by any other law, premium
for which shall be paid by the Barangay. (Sec. 4, Treasury Circular No. 02-
2009, 06 August 2009)
3. All Heads of Agencies shall upon appointment or lawful accession by any

accountable public officer to a bondable position or office pertaining to their
respective jurisdiction or separation therefrom of any such public officer,
notify in writing the Treasurer of the Philippines (TOP) through the Bureau
of the Treasury (BTr) District/Provincial Office (DO/PO) having jurisdiction
71

LTOM, 2nd EDITION
over the agency/office/Government Owned and Controlled Corporation

(GOCC)/LGU/State University and College (SUC) within 5 days from
such appointment, lawful accession or separation and submit the required
application for bond or cancellation thereof, as applicable. (Local Treasury
Circular No. 02-2009, Sec. 6.2)
4. The duty to notify the TOP shall be given preferential attention of such heads
of departments, bureaus and offices of the National Government including
GOCCs, SUCs, heads of LGUs, Provincial and Local Treasurers and other
officials concerned. (Local Treasury Circular No. 02-2009, Sec. 6.3)
B. Procedure for Bonding Application.
1. The applicant shall accomplish in duplicate General Form (GF) Nos. 57A
(Request Form) and 58A (Application Form), copies of which can be
secured from BTr DOs/POs GF No. 58Aand shall be subscribed and sworn
to before any officer authorized to administer oath, attaching therewith two
(2) passport size identification pictures taken within the last three (3) months
prior to the date of application. The Request and Application Forms shall be
accompanied by the following:
a. Latest SALN
b. List of bondable public officers certified by the agency officer in charge

of Administrative and/or Finance Department, Service, Division or unit
(Form Annex D of TC No. 02-2009)
2. The Request and Application Forms, together with required supporting

documents, shall be filed at the BTr DOs/POs having jurisdiction over the
agency for verification of the following:
a. If GF Nos. 57A and 58A have been properly accomplished and in

order;
b. If the required supporting documents are complete and in order;
c. If the name of the applicant appears on the list of bondable public

officers submitted by the agency; and
d. If the applicant is a safe and conservative risk in accordance with Sec.

320 of the PBL.
3. In case of non-compliance with the aforementioned documents, the request

and application form shall be returned to the applicant for necessary
correction and/or compliance.
4. If documents are found to be complete and in order, the applicable bond

premium shall be assessed and corresponding authority to accept payment
(ATAP) shall be issued to the applicant for the payment of bond to the
Authorized Government Depository Bank (AGDB) where the TOP has a
deposit account.
(Treasury Circular No. 02-2009, 06 August 2009)
72

BONDING OF LOCAL TREASURERS AND OTHER LGU ACCOUNTABLE OFFICERS
SECTION 26. SCHEDULE OF CASH ACCOUNTABILITY

AND THE CORRESPONDING BONDS
A. Amount of Bond.
The amount of bond shall be based on the total accountability (cash, property
and accountable forms) of the accountable public officer as determined by the
Head of Agency (HoA). Provided, the individual maximum accountability of each
accountable public officer shall not exceed One Hundred Million Pesos(PhplOOM).
However, the HoA may assign to other public officers the excess accountability
for which separate Fidelity Bond shall be secured. (Sec. 5.1, Treasury Circular
No. 02-2009)
B. Authority to Fix Schedule of Premium.

The TOP with the approval of the Secretary of Finance shall fix and, from time to
time, review the uniform rate of the bond premium chargeable for insurance under
the PBL. (Sec. 5.2, Treasury Circular No. 02-2009)
C. Rate of Premium.
The rate of premium of the Fidelity Bond is equal to 1.5% of the amount of bond
but shall not be less that Php150.00. The Revised Schedule of Premium Rates
(please refer to the table below) shall form an integral part of Treasury Circular
02-2009 until amended or revised. (Sec. 5.3, Treasury Circular No. 02-2009)
1. CASH ACCOUNTABILITY
Minimum Cash Maximum Cash

Amount of Bond Bond Premium
Accountability Accountability
Bond Premium shall

75% of their Total
not be less than
5,000.00 9,000.00 Cash Availability
Php 150.00
9,001.00 12,000.00 9,000.00 150.00

12,001.00 15,000.00 11,250.00 168.75
15,001.00 18,000.00 13,500.00 202.50
18,001.00 21,000.00 16,750.00 251.25
21,001.00 25,000.00 18,900.00 283.50
25,001.00 30,000.00 22,500.00 337.50
30,001.00 35,000.00 26,250.00 393.75
35,001.00 40,000.00 30,000.00 450.00
40,001.00 50,000.00 37,500.00 562.50
50,001.00 60,000.00 45,000.00 675.00
60,001.00 80,000.00 60,000.00 900.00
80,001.00 100,000.00 75,000.00 1,125.00
100,001.00 250,000.00 100,000.00 1,500.00
250,001.00 500,000.00 225,000.00 3,375.00
500,001.00 750,000.00 350,250.00 5,253.75
750,001.00 1,000,000.00 500,000.00 7,500.00

LTOM, 2nd EDITION
Minimum Cash Maximum Cash

Amount of Bond Bond Premium
Accountability Accountability
1,000,001.00 2,500,000.00 750,000.00 11,250.00
2,500,001.00 5,000,000.00 1,500,000.00 22,500.00
5,000,001.00 25,000,000.00 3,500,000.00 52,500.00
25,000,001.00 75,000,000.00 4,000,000.00 60,000.00
75,000,001.00 100,000,000.00 5,000,000.00 75,000.00
2. PROPERTY ACCOUNTABILITY
a. Government Securities 30% of their total value x 1.5% = Premium

b. Equipment 30% of their total value x 1.5% = Premium
c. Supplies and Materials 30% of their total value x 1.5% = Premium
3. FOR ACCOUNTABLE FORMS
a. Internal Revenue Stamp

b. Documentary Stamp
c. Customs Documentary Stamp
d. Cash Tickets 10% of their total
value rounded
e. Postage and other Stamp Stocks X 1.5% = Premium
off to the nearest
f. Cattle Registration Certificates hundred
g. Marriage Certificates
h. Auto Driver Certificates
i. Motor Vehicle License
j. Other Accountable Forms
having face value
SECTION 27. RENEWAL

The Fidelity Bond of an accountable officer shall be renewed before the expiration
of the bond. The application for renewal of bond shall be accomplished by using
General Form 57Aand accompanied by the following:
A. List of bonded public officers subject for renewal certified by the agency official
in charge of Administrative and/or Finance Department, Service, Division or
Unit;
B. Agency certification that the bond applicant has no pending administrative and/
or criminal case (Annex E). For a bond applicant with pending administrative
and/or criminal case, copies or pertinent pleadings, orders and resolutions
filed or issued by the disputing parties, prosecutory or investigatory
offices and judicial bodies shall be attached to the bond application;
C. Copy of the latest BTr approved bond or copy of the Confirmation Letter; and
D. Latest Sworn SALN (7.2 - 7.2.3, Treasury Circular No. 02-2009, 06 August
2009)
74

SECTION 28. INCREASE IN THE AMOUNT OF ACCOUNTABILITY

A. Any increase in the amount of accountability will have a corresponding increase
in the premium of the bond.
B. The applicant shall accomplish and submit GF 57A to the concerned DO/PO
together with the following:
C. Special Order increasing the amount of accountability; and
1. List of bonded public officers certified by the agency official in charge of:
Administrative and/or Finance Department, Service, Division or Unit.
2. The amount of bond premium shall be computed based on the increased

amount of bond. The bond shall take effect upon the time of payment of
premium on the new bond application.
D. The Chief Treasury Operations Officer (CTOO) II of the BTr concerned shall cancel
the previously assigned risk number to the applicant and issue a new risk number
to the new bond application. (7.3 Treasury Circular No. 02-2009, 06 August 2009)
SECTION 29. ACCOUNTABLE OFFICERS CONSIDERED

UNSAFE RISKS
The bond application shall be evaluated to determine if the applicant is a safe and
conservative risk in accordance with Sec. 320 of the PBL. When there is basis to
prove that the applicant public officer is an unsafe risk owing to character, association
or habits, the following procedures shall be followed:
A. The bond application shall be transmitted to the RD with the recommendation for
disapproval stating the basis therefor. When the recommendation is affirmed by the
RD, the disapproval shall be communicated in writing to the HoAof the applicant
public officer stating therein the factual and legal basis for such disapproval.
B. The disapproval/decision of the RD maybe appealed by the concerned HoA by

filing a letter of appeal with the TOP within fifteen (15) days from the receipt of
such disapproval/decision. The letter of appeal shall state clearly and distinctively
the grounds and arguments of the appeal. A copy of the assailed written action/
decision and disapproved bond application and its supporting documents shall be
attached to the letter of appeal. The letter of appeal shall likewise be accompanied
by a postal money order or MDS check in the amount of Php500.00 as appeal fee
payable to the TOP.
C. Within 5 days from receipt of the letter of appeal and the appeal fee, the TOP
shall require the RD to elevate the entire records relating the disapproved bond
application. The TOP shall have fifteen (15) days from receipt of the records from
the RD to resolve the appeal.
D. The decision of the TOP shall be final, executory and not appealable. (7.1.8,
Treasury Circular No. 02-2009, 06 August 2009)
75

LTOM, 2nd EDITION
SECTION 30. CANCELLATION OF BOND

The HoA or authorized representative shall immediately submit a written request
for bond cancellation to the concerned BTr DO/PO CTOO II involving accountable
public officers who are no longer accountable by reason of retirement, separation
from the service, promotion, transfer, suspension from office or for any other cause
rendering them not bondable to their present position. They shall likewise request for
the cancellation of the bond and shall accomplish GF Nos. 57A, items 10-16. (7.4
Treasury Circular no. 02-2009, 06 August 2009)
SECTION 31. EFFECT OF CANCELLATION

The cancellation of the bond for any cause allowed under Treasury Circular No. 02-
2009 before expiration date, has the effect of limiting the liability of the Fidelity Fund
to the transactions within the period covered up to the time of its cancellation. The
bond premium paid for the accountable public officer whose bond is canceled shall
not be transferrable and not refundable. (4.12, Treasury Circular No. 02-2009)
SECTION 32. THE FIDELITY FUND

A. All bond premium collected by the BTr shall constitute the Fidelity Fund. The
Fund shall answer for defalcations, shortages and unrelieved accountability after
all possible means of recovery of the amount from the accountable official or
employee have been exhausted or his/her insolvency is declared by a competent
court. It shall be available for the payment of court fees incident to civil proceedings
to recover the sum lost.
B. The Fidelity Fund shall not be used for the following:
1. To replace fines imposed on bonded officials/employees as a result of

criminal conviction for violation of the Revised Penal Code or any penal law;
2. To answer the liability of a bonded official/employee convicted of estafa

through falsification of public documents in his/her capacity as private
individual; and
3. To refund the accountability of a bonded official/employee found short in

accountability but not removed or relieved of the duties. (Sec. 8.0, Bureau of
the Treasury Order No. 01-95)
SECTION 33. EXTENT OF LIABILITY

A. Primary Liability. The head of any Government agency at all levels, whether
national, corporate or local is primarily responsible and accountable for all
government funds and property pertaining to his agency. (Sec. 6.1, Treasury
Circular No. 02-2009)
76

B. Effect of Failure to Notify. Failure on the part of the HoA to make the required
notification to the TOP through the concerned DO/PO shall render them primarily
liable to any such loss or damage to public funds or properties their respective
agency, province, city or municipality, barangay as the case maybe, may incur on
account of such failure. (Sec. 6.4, Treasury Circular No. 02-2009)
SECTION 34. VALIDITY OF FIDELITY BONDS

A. An accountable public officer shall be considered bonded/insured with the Fidelity
Fund upon payment of the bond premium. The Fidelity Bond shall be valid and
effective at the time of payment and receipt of bond premium by the AGDB. The
accountable public officer shall submit to the BTr DO/PO a copy of the AGDB
validated deposit slip and ATAP as proof of payment of bond premium, after which
the confirmation letter shall be issued. (4.9, Treasury Circular No. 02-2009, 06
August 2009)
B. An approved Fidelity Bond shall be non-transferable and personal to the

accountable public officer and shall remain valid and effective for one (1) year from
the time of payment and receipt of bond premium. The Fidelity Bond shall be
subject to renewal yearly before the expiration of the present bond coverage while
the accountable public officer is holding such position for which he was bonded.
Failure to renew shall consider such bond as automatically cancelled and shall
have no legal effect. (Treasury Circular No. 02-2009, Sec. 4.10)
SECTION 35. ADJUDICATION AND PAYMENT OF CLAIMS

AGAINST THE FIDELITY FUND
A. Application for Relief from Accountability - When loss of public funds or
property occurs while they are in transit or the loss is caused by fire, theft, or
other casualty or force majeure, the public officer accountable therefore or having
possession, custody or control thereof shall immediately notify the COA or the
agency auditor concerned, and within thirty (30) days or such longer period as
the Commission or auditor may in the particular case allow, shall present his
application for relief with the available supporting evidence.
B. Effect of Relief from Accountability by COA - The relief from accountability of

the accountable public officer granted by the COA shall relieve the agency from
responsibility for the loss or damage to public funds or property.
C. Fidelity Fund; When Liable - When no relief of accountability is granted by COA,

the agency concerned may file claim for reimbursement from the Fidelity Fund to
the extent of the approved bond covered or amount of loss whichever is lower.
D. Claims-Anyand all claims against the Fidelity Fund shall be filed asa money claim
with COA, with copy to BTr together with the evidence relating thereto. Claims
approved by the COAshall constitute a legal claim against the Fidelity Fund.
77

LTOM, 2nd EDITION
E. Requirements for Payment of Adjudicated Claim - The agency shall file a claim
for payment from the Fidelity Fund with the BTr, attaching the favorable findings
of COA. The BTr shall process the claim in accordance with existing budgeting,
accounting and auditing rules and regulations.
1. In case of defalcation, shortages and unrelieved losses in the account

of bonded public officer, the claim shall be supported by the following
documents:
a. Agency and COA findings and recommendation on the defalcation,

shortages and unrelieved accountability;
b. Latest SALN of the bonded official/employee;
c. Proof of current and subsisting bond and payment of bond premium;

and
d. Other document/s which may be required by the BTr.
2. In case of proven shortages and defalcation, the public officer responsible

thereto should be removed or relieved of his duties without prejudice to civil,
criminal or administrative cases to be instilled.
3. Only approved claims shall be paid from the Fidelity Fund. (8 -8.5.3, Treasury
Circular No. 02-2009, 06 August 2009)
F. Penal Clause
Unjustified failure of an accountable public officer to comply with the requirements

to apply the Fidelity Bond pursuant to Treasury Circular No. 02- 2009 and the
PBL shall subject the responsible official/employee to applicable criminal, and/
or administrative liability under the Revised Penal Code and PD 1445. (9.0
Treasury Circular No. 02-2009, 06 August 2009)
78

FORMS AND ANNEXES
79

LTOM, 2nd EDITION
FORMS AND ANNEXES
80

FORMS AND ANNEXES
ANNEX 1- LIST OF LAWS THAT SHAPED FISCAL DECENTRALIZATION
IN THE PHILIPPINES
Laws Provisions
19 June 1959 If the provincial board, municipal board or city council of
the city, or municipal council of the municipality or regularly
Republic Act No. 2264 organized municipal district shall fail to enact a budget
before the beginning of the ensuing fiscal year, the budget
An Act Amending the for the preceding fiscal year shall be deemed re-enacted.
Laws Governing Local (Section 1)
Governments by Increasing
their Autonomy and Copies of the provincial and city budgets shall be furnished
Reorganizing Provincial the Secretary of Finance within ten days from their approval,
Governments who shall have the power to review such budgets in order
to see to it that the above provisions and conditions are
complied with. If within ninety days after submission to the
Secretary of Finance, the secretary takes no action, the said
budget shall be deemed to have complied with the above
provisions. (Section 1)
All chartered cities, municipalities and municipal district

shall have authority to impose municipal license taxes or
fees upon persons engaged in any occupation or business,
or exercising privileges in chartered cities, municipalities or
municipal districts by requiring them to secure licenses at
rates fixed by the council of the LGU (Section 2)
All chartered cities, municipalities and municipal district

shall have authority to regulate and impose reasonable
fees for services rendered in connection with any business,
profession or occupation being conducted within the city,
municipality or municipal district and otherwise to levy for
public purposes, just and uniform taxes, licenses or fees
(Section 2)
Provincial Boards of provinces shall have the authority

to appropriate money for purposes not specified by law,
having in view the general welfare of the province and the
inhabitants and to appropriate money for loans or aids to
municipalities or municipal districts of the province under
such terms and conditions as the provincial boards may fix.
(Section 3)
Appointments by provincial governors, city mayors and

municipal mayors shall become effective upon the issuance
of such appointments and upon attestation by the provincial
treasurer of provinces, in case of appointments made by
81

LTOM, 2nd EDITION
Laws Provisions
provincial governors and municipal mayors, and by the city
treasurer, in case of appointments made by city mayors. All
appointments made by provincial governors, city mayors
and municipal mayors shall, after being attested to by the
respective provincial or city treasurers, be forwarded within
ten days to the commissioner of civil service for review
pursuant to civil service law and rules. (Section 8)
1 January 1960 The barrio council with the approval of a two-thirds vote
of the barrio assembly as provided in section four hereof,
Republic Act No. 2370 may raise, levy, collect and/or accept monies and other
contributions from the following sources (Section 14):
An Act Granting
Autonomy to Barrios of • Voluntary contributions annually from each male or
the Philippines, otherwise female resident twenty-one years of age or over;
known as “Barrio Charter • License on stores, signs, signboards, and billboards
Act” displayed or maintained in any place exposed to public
view except those displayed at the place or places
where profession or business advertised thereby is in
whole or in part conducted;
• A tax on gamecocks owned by residents of the barrio

and on the cockfights conducted therein: Provided,
that nothing herein shall authorize the barrio council to
permit cockfights.
• Monies, materials and voluntary labor for specific public

works and cooperative enterprises of the barrio raised
from resident, landholders, producers and merchants of
the barrio;
• Monies from grants-in-aid, subsidies, contributions and

revenues made available to barrios from municipal,
provincial or national funds;
• Monies from private agencies and individuals;
• An additional percentage, not exceeding one-fourth of

one percent of the assessed valuation of the property
within the barrio, collected by the municipal treasurer
along with the tax on real property levied for municipal
purposes by the municipality and deposited in the name
of the barrio with the municipal treasurer: Provided, that
no tax or license fee imposed by a barrio council shall
exceed fifty per centum of a similar tax or fee levied,
assessed or imposed by the municipal council.
82

FORMS AND ANNEXES
Laws Provisions
Ten per cent of all real estate taxes collected within the
barrio shall accrue to the barrio general fund, which sum
shall be deducted in equal amounts from the respective
shares of the province and municipality: Provided, That the
municipal treasurer may designate the barrio lieutenant and/
or the barrio treasurer as his deputy to collect the said taxes.
(Section 15)
All ordinances for raising barrio funds through taxes and

voluntary contributions may be initiated in the barrio council,
and submitted to the barrio assembly. Such ordinances may
also originate in the barrio assembly which may approve
the same finally without further action by the barrio council.
(Section 16)
The barrio treasurer shall collect all taxes existing (except

real property), fees and contributions due the barrio treasury
for which he shall issue official receipts. The treasurer, who
shall be bonded in any amount to be fixed by the barrio
council not exceeding ten thousand pesos, shall be the
custodian of the barrio funds and property and shall deposit
all collections with the municipal treasurer within a period
of one week after receipt of such fees and contributions.
(Section 16)
12 September 1967 The purpose of this Act to grant to local governments greater
freedom and ampler means to respond to the needs of their
An Act Granting Further people and promote their prosperity and happiness and
Autonomous Powers to effect a more equitable and systematic distribution of
to Local Governments, governmental powers and resources. (Section 2)
otherwise known as
‘‘Decentralization Act of The allotment share of provinces and cities as provided for in
1967” the penultimate paragraph of Section eight, Commonwealth
Act Numbered Five hundred eighty-six, as amended by
Republic Act Numbered Seven hundred eighty-one, is
hereby increased from ten to thirteen per centum and the
allotment share of municipalities exclusive of cities as
provided for in the same Code is hereby increased from
two to four per centum, provisions of existing laws to the
contrary notwithstanding. (Section 13)
Within five days after the end of each month, the treasury
field cashiers to whom all collection agents shall remit all
their collections in each province shall retain from the internal
revenue collections accruing to the General Fund and remit
to the Provincial Treasurer an amount equivalent to one
twelfth of the predetermined annual internal revenue regular
allotment of the province and municipalities under it, and to
the city treasurer an amount equivalent to one-twelfth of the
pre-determined annual internal revenue regular allotment
of the city: Provided, That in provinces where there are no
treasury field cashiers, such personnel shall be appointed.
(Section 14)
83

LTOM, 2nd EDITION
Laws Provisions
26 August 1972 Regulations on building permit, inspection and other fees,
and for compliance with the same shall be covered by
Republic Act No. 6541 city and municipal ordinances: Provided, That Traditional
indigenous family dwellings under Section 1.01.04 (d) shall
An Act to Ordain and be exempt from payment of building permit fees. (Section
Institute a National Building 1.02.04)
Code of the Philippines,
otherwise known as
‘‘National Building Code
of the Philippines”
1 July 1973 Section 2. Fundamental Principles
Section 4. Local Authority.
Section 5. Common Limitations on the Taxing Powers of
Presidential Decree No. Local Governments.
231 Section 7. Tax on Transfer of Real Property Ownership.
Section 8. Tax on Business of Printing and Publication
Section 9. Franchise Tax.
Enacting a Local Tax Section 10. Sand and Gravel Fee
Code for Provinces, Cities, Section 11. Taxes Transferred
Municipalities and Barrios, Section 12. Occupation Tax
otherwise known as “Local Section 13. Amusement Tax on Admission.
Tax Code” Section 14. Fees for Sealing and Licensing of Weights and
Measures.
Section 15. Tax on Peddlers.
Section 16. Rental Fee for Use of Municipal Waters, Rivers
etc. as Log Pond
Section 17. Specific Limitations on Power
Section 18. Scope of Powers of Municipalities
Section 19. Tax on Business of Municipalities
Section 20. Fees and Charges of Municipalities
Section 21. Fishery Rentals or Fees of Municipalities
Section 22. Specific Limitations on Power of
Municipalities
Section 23. Scope of Power of Cities
Section 24. Additional Taxing Powers of Cities
Section 25. Specific Limitation on Power of Cities
Section 26. Scope of Power of Barrios
Section 27. License Taxes and Fees of Barrios
Section 28. Service Charges of Barrios
Section 29. Contributions of Barrios
Section 30. Market Fees
Section 31. Slaughterhouse Fees3
Section 32. Public Utility Charges.
Section 33. Tuition Fees.
Section 34. Tolls for Roads, Bridges, Canals and Ferries.
Section 35. Charges for Holding Benefits
Section 36. Permit Fee
Section 37. Service Charge
84

FORMS AND ANNEXES
Laws Provisions
Section Fixing of the Tax and Manner of Payment.
53.
Section Accrual of the Tax.
54.
Section Time for the Payment.
55.
Section Collection of Local Revenue by Treasurer.
58.
Section Examination of Books of Accounts
59.
and Pertinent Records of Businessmen by
Provincial or City Treasurer.
Section 60. Application of Article.
Section 61. Local Government’s Lien.
20 May 1974 This Code shall govern the appraisal and assessment of
real property for purposes of taxation by provinces, cities
Presidential Decree 464 and municipalities, as well as the levy, collection and
administration of real property tax. (Section 1)
Enacting A Real Property
Tax Code, otherwise known Chapter II of this Code provides the provisions on the
as ‘‘Real Property Tax appraisal and assessment of real property.
Code” Section 4. Administration of the Real Property Tax.
Section 15. Preparation of Schedule of Values.
Section 17. Amendment of Schedules of Market Values.
Section 23. Certification of Revised Values to the Secretary
of Finance.
Chapter V of this Code provides the provisions on Special

Levies on Real Property.
Section 41. An additional one per cent tax on real property

for the Special Education Fund.
Section 42. Additional ad valorem tax on idle lands.
Section 47. Special levy by local governments.
Section 55. Special levy by the National Government.
Chapter VI of this Code provides the provisions on Collection

of Real Property Tax.
Section 57. Collection of tax to be the responsibility of

treasurers.
Section 58. Assessor to furnish treasurer with assessment
roll.
Section 59. Notice of time for collection of tax.
Section 60. Payment of real property taxes in installments.
Chapter VIII of this Code provides the provisions on

Organizations, Functions and Supervisions.
Section 88. Provincial or city assessor, his assistant and

deputies and their appointments.
Section 91. Supervision over local assessment offices.
Section 96. Remission of tax by provincial or city board or
council.
85

LTOM, 2nd EDITION
Laws Provisions
3 June 1974 This Decree shall govern the conduct and management
of the financial affairs, transactions, and operations of
Presidential Decree No. provinces, cities, municipalities and barrios, and shall
477 provide the organization for local administration in the local
governments. (Section 1)
“Decree on Local Fiscal
Administration” Section 3. Supervisory authority of the Department of
Finance.
Section 7. The Local Funds.
Section 12. Separation of Personal Money from Public
Funds.
Chapter II of this Decree provides the provisions on Special

Accounts.
Section 15. Form and Content.

Section 24. The role of the treasurer in the budget process.
Section 29. Review of Provincial and City Budgets.
Section 30. Review of Municipal Budgets.
Chapter IV of this Decree provides the provisions

on Expenditures, Disbursements, Accounting and
Accountability.
Section 41. Disbursement of Local Government Funds in

General.
Section 51. Certification, on and approval of, vouchers.
Section 52. Officials authorized to draw checks in
settlement of obligations.
Chapter V of this Decree provides the provisions

on Organization for Local Fiscal Administration
Section Provincial or City Treasurers.

60.
Section 61.
Qualifications.
Section Sub provincial treasurers.
63.
Section Assistant Provincial or City Treasurer.
64.
Section 65.
Qualifications and Functions.
Section Municipal or Municipal District Treasurer.
70.
Section 71.
Qualifications.
Section 73.
Treasury and auditorial visitations.
Section Assistant Municipal or Municipal or Municipal
74.
District Treasury.
Section 75. Qualifications and Functions.
Section 78. Appointment of treasury personnel in provinces,
cities, municipalities and municipal districts.
Section 79. Local treasury career service.
86

FORMS AND ANNEXES
Laws Provisions
2 August 1974 Every requisitions must be accompanied by a certificate,
signed by the local treasurer showing that an appropriation
therefore exists and that the estimated amount of such
Presidential Decree No. expenditure has been set aside for its liquidation. (Section
526 6)
When procurement is to be done at the local government
Providing for an Improved level and save in exempt cases, the local treasurer shall call
System of Acquisition, bids for open public competition. The call for bids shall show
Utilization, Care, Custody the complete specifications and technical descriptions of the
and Disposal of Supplies supplies desired and shall embody all terms and conditions
in the Local Governments, of participations and award, terms of delivery and payment
Amending for the Purpose and of all other covenants affecting the transaction.
Section of RA No. 246,
In all calls for bids, the right to waive any defect in the tender
otherwise known as
as well as the right to accept the bid most advantageous to
“The Local Autonomy
the government shall be reserved. In no case, however, shall
Act of 1959”, and Other
failure to meet the specifications or technical requirements
Related Laws (Supply
of the supplies desired be waived. (Section 8)
Management)
In cases of emergency where the need for the supplies is
exceptionally urgent or absolutely indispensable to prevent
immediate danger to, or loss of, life, local government units
may make emergency purchases or place repair orders
without public bidding regardless of amount. Delivery and
utilization of purchase and/or repair orders under this section
shall be made within fifteen (15) days after the placing of the
same. Immediately after the emergency purchase or repair
order is made, the chief of office or department making the
emergency purchase or repair order shall draw a regular
requisition to cover the same showing thereon (Section 14)
On or before the fifteenth day of April each year, the local

treasurer shall prepare, for the approval of the local chief
executive, an annual procurement program for the ensuing
fiscal year which shall contain and show an itemized list
of the estimated quantity of supplies needed for the entire
ensuing fiscal year, a complete description thereof as
to kind, quantity and quality, the estimated cost, and the
balance on hand. However, the total estimated cost of the
approved annual procurement program shall not exceed
the total appropriations authorized for the acquisition of
supplies. (Section 19)
87

LTOM, 2nd EDITION
Laws Provisions
19 May 1975 Tax Declaration on Real Property. - Imprisonment for a
period of not less than two (2) nor more than four (4) years
Presidential Decree No. and perpetual disqualification from holding an elective
705 or appointive office, shall be imposed upon any public
officer or employee who shall issue a tax declaration on
Revising Presidential real property without a certification from the Director of
Decree No. 389, otherwise Forest Development and the Director of Lands or their
known as the Forestry duly designated representatives that the area declared
Reform Code of the for taxation is alienable and disposable lands, unless the
Philippines property is titled or has been occupied and possessed by
members of the national cultural minorities prior to July 4,
1955. (Section 84)
25 June 1975 This Decree shall be known as the decree on Credit
Financing for Local Governments, which shall govern the
Presidential Decree No. conduct and management of the credit transactions and
752 borrowings of provinces, cities, and municipalities. (Section
1)
‘Credit Financing for
Local Governments” It shall be the basic policy that any local government may
avail of credit facilities and resort to borrowings only if the
local funds are not sufficient to finance the prosecution,
completion, expansion, operation, and maintenance of local
infrastructures and other socio-economic developmental
projects. (Section 2)
Provincial, city and municipal governments may upon

recommendation of the Secretary of Finance contract loans,
credits, and other forms of indebtedness with the Philippine
National Bank, the Development Bank of the Philippines,
the Government Service Insurance System, and/or any
other national lending institution to finance the construction,
installation, improvement, expansion, operation, or
maintenance of electric light and power plants, public
markets and slaughter-houses, waterworks and irrigation
systems, telephone and radio communications systems,
government housing projects, the purchase of rural and
urban estates and other capital investment projects, subject
to such terms and conditions as may be prescribed by law
and the provisions of the respective charters of the aforesaid
banks and lending institutions. [Section 4 (a)]
Provincial, city and municipal governments may likewise

secure from the Land Bank of the Philippines short, medium
and long-term loans and advances against security of real
estate and/or other acceptable assets for the establishment,
development or expansion of agricultural, industrial, home
building or home financing projects and other productive
enterprises. [Section 4 (b)]
88

FORMS AND ANNEXES
Laws Provisions
The Secretary of Finance shall promulgate, from time to
time, such rules and regulations, as he may deem necessary
for the proper and effective implementation of this Decree.
(Section 11)
19 December 1975 Declaration and listing in the assessment rolls. All timber
and forest lands owned by the Republic of the Philippines
Presidential Decree No. or any of its political subdivision, the beneficial use of which
853 has been granted to a taxable person, shall be declared for
taxation purposes and listed in the assessment rolls in the
Providing for the name of the concessionaire or licensee.
Classification and Valuation
of Timber and Forest All timber and forest lands that are privately owned shall
Lands for Purposes of Real be declared and listed in the name of the private owner.
Property Tax (Section 2)
Assessment Level. The assessment level for all timber and

forest lands shall be 40% of their market value as determined
by the Provincial/City Assessor in accordance with such
methods, procedures or regulations that the Secretary of
Finance may prescribe for the purpose. (Section 3)
Appraisal and Assessment of Timber and Forest Lands.
1. In cases where timber or forest land is located in one

municipality or in one city, it shall be the responsibility of
the Provincial/City Assessor, by himself or thru his Municipal
Deputy Assessor, to appraise and assess the same in
accordance with the methods, procedures, or regulations
that the Secretary of Finance may prescribe therefor.
2. In cases, however, where the timber and forest lands

are found in two or more municipalities, the Provincial
Assessor likewise shall appraise and assess the same and
he shall issue separate tax declarations covering the areas
corresponding to each municipality.
3. In cases where timber and forest lands cover two or

more provinces and/or cities, the Provincial/City Assessors
concerned shall jointly appraise and assess the property in
accordance with regulations to be issued by the Secretary
of Finance. (Section 5)
Officer responsible for the collection of the real property

tax. The basic and additional real property tax on timber
and forest lands shall be collected by the Provincial/City
Treasurers where the timber and forest lands are located.
(Section 7)
Tax Discount. If the basic real property tax and the additional
one (1 %) per cent tax accruing to Special Educational Fund
are paid in full within the prescribed period of payment as
provided for under Section 60 of Presidential Decree No.
464, the taxpayer shall be granted a discount as follows:
89

LTOM, 2nd EDITION
Laws Provisions
60% on the tax due and payable during the year
1975,
1976,and
1977. (Section 9)
Remedies and Sanctions. Collection of the real property tax

shall may be enforced through any or all of the remedies
provided under Presidential Decree No. 464, and the use
or nonuse of one remedy shall not be a bar against the
institution of the others. (Section 11)
There shall be created in every municipality where there

are timber and forest lands, regardless of class of such
municipality, the position of Municipal Deputy Assessor,
whose appointment shall be governed by Section 90 of
Presidential Decree No. 464. (Section 12)
12 April 1976 For purposes of effective fiscal management, Metropolitan
Manila is hereby divided into the four (4) Local Treasury and
Presidential Decree No. Assessment Districts. (Section 1)
921
Under the general direction of the Commissioner for Finance
“Providing for the of the Metropolitan Manila Commission, the City Treasurers
Administration of Local and the City Assessors of the treasury and assessment
Financial Services in districts created under Section one hereof shall, henceforth,
Metropolitan Manila, exercise general supervision over the local treasury and
creating Local Treasury assessment offices of the municipalities belonging to
and Assessment Districts their respective districts. Accordingly, said City Treasurers
therein” and City Assessors, in addition to the powers, duties, and
functions exercised by them under existing laws, decrees,
and rules and regulations, shall also discharge the duties
and functions heretofore exercised and performed under
existing laws by the Provincial Treasurers and Provincial
Assessors of the provinces of Rizal and Bulacan insofar
as the aforesaid offices of the municipalities within the
Metropolitan Manila Area are concerned. (Section 2)
The power to appoint the Municipal Treasurers, Assistant

Municipal Treasurers and Municipal Deputy Assessors
of the municipalities within the Metropolitan Manila Area
theretofore exercised by the Provincial Treasurers and
Provincial Assessors of the provinces concerned shall
be vested upon the Commissioner for Finance of the
Metropolitan Manila Commission subject to the provisions
of Sections 70 and 74 of Presidential Decree No. 477 and
Section 90 of Presidential Decree No. 464, as the case may
be, upon recommendation of the City Treasurer or the City
Assessor of the District concerned. (Section 3)
90

FORMS AND ANNEXES
Laws Provisions
As provided for under existing laws, the City Treasurers and
City Assessors of cities integrated in the Metropolitan Manila
Area shall be appointed by the President of the Philippines
upon recommendation of the Secretary of Finance. Assistant
City Treasurers, Assistant City Assessors and other city
treasury and assessment personnel shall be appointed in
accordance with the provisions of existing laws. (Section 5)
The City and Municipal Treasurers of the cities and

municipalities in the Metropolitan Manila Area shall continue
to perform their duties and functions as such treasurers
conformably with existing laws, decrees, and rules and
regulations, and as herein provided for. (Section 6)
The City Assessors and Municipal Deputy Assessors in the

Metropolitan Manila Area shall continue to perform their
duties and functions as such assessors conformably with
existing laws, decrees, and rules and regulations. (Section
8)
16 May 1978 The Budget Commission shall be responsible for the
review and evaluation and for taking appropriate action on
Presidential Decree No. the annual principal and supplemental budgets and other
1375 financial statements covering all funds of local governments;
and the review and formulation of recommendations on
“Transferring to the Budget resolutions of local legislative bodies involving appropriation
Commission the functions of local funds. (Section 1)
of Local Government
Budget Administration” Revenue funds shall not be paid out of any local treasury
except in pursuance of specific statutory authority or of
appropriations duly approved pursuant to PD No. 477 and
this Decree. (Section 5)
10 February 1983 Each local government unit shall have the power to create
its own sources of revenue and to levy taxes, subject to
Batas Pambansa 337 such limitations as may be provided by law. [Section 8(1)]
For purposes of taxation by local government units, the

“The Local Government appraisal and assessment of real property, as well as the
Code” levy, collection and administration of real property taxes,
shall be governed by the provisions of existing laws insofar
as they are not inconsistent with this Code. [Section 8(2)]
The barangay treasurer shall collect all taxes due or unpaid

including real property taxes, fees and other charges and
contributions accruing to the barangay treasury for which he
shall issue official receipts and shall deposit all collections
with the city or municipal treasury within a period of one
week after receipt thereof: Provided, That he collects the real
property tax due in his own barangay after being deputized
by the treasurer concerned for the purpose. [Section 107(1)]
91

LTOM, 2nd EDITION
Laws Provisions
The financial records of the barangay shall be kept in the
office of the city or municipal treasurer in simplified manner
as prescribed by the Commission on Audit Representatives
of the Commission on Audit shall annually audit such
accounts or as often as may be necessary and make a
report of the audit to the sangguniang barangay and to the
sangguniang bayan or sangguniang panlungsod, as the
case may be. [Section 107(2)]
The municipal treasurer shall be appointed by the Minister

of Finance upon recommendation of the municipal mayor,
subject to civil service law, rules and regulations. He shall
take charge of the municipal treasury office and acts as the
chief financial officer of the municipality. [Section 155(1)]
The provincial treasurer shall take charge of the provincial

treasury office and act as the chief financial officer of the
province. [Section 212(1)]
There shall be an assistant provincial treasurer who shall be

appointed by the Minister of Finance upon recommendation
of the provincial governor, subject to civil service laws,
rules and regulations. When the exigency of the service
so requires, additional positions for assistant provincial
treasurers may be created. [Section 213(1)]
16 July 1987 Incentives to Registered Enterprises. (Article 39)
Regional or area headquarters established in the Philippines

by multinational corporations and which headquarters do
Executive Order No. 226 not earn income from the Philippines and which act as
supervisory, communications and coordinating center for
their affiliates, subsidiaries, or branches in the Asia-Pacific
The Omnibus Regional are exempted from the payment from income tax.
Investments Code of 1987 (Article 63)
Regional or area headquarters in the Philippines by

multinational corporations are exempt from contractor’s tax.
(Article 64)
The regional or area headquarters of multinational companies

shall be exempt from all kinds of local licenses, fees, dues,
impost or any other local taxes or burdens.(Article 65)
Regional or area headquarters shall enjoy tax and duly

free importation of equipment and materials for training,
conferences which are needed for the functions of the
regional or area headquarters and which are not locally
available subject prior approval of the Board of Investments
(BOI). (Article 66)
92

FORMS AND ANNEXES
Laws Provisions
9 January 1990 Until otherwise provided by the Congress, there is hereby

constituted the Metropolitan Manila Authority, hereinafter
Executive Order No. 392 referred to as the Authority, to be composed of the heads of
the four (4) cities and thirteen (13) municipalities comprising
“Constituting the the Metropolitan Manila area. (Section 1)
Metropolitan Manila
Authority” The Authority shall have jurisdiction over the delivery of basic
urban services requiring coordination in the Metropolitan
Manila. These basic urban services shall include among
others: land use, planning and zoning; traffic management;
public safety; urban development and renewal; management
and control of operations during calamities and emergencies
affecting public welfare and safety; and sanitation and waste
management. Any change in the classification of zoning
shall however be subject to the approval of the Housing and
Land Use Regulatory Board (HLURB). (Section 1)
• The Authority shall be governed by the Metropolitan

Manila Council, hereinafter referred to as the Council,
composed of the Mayors of the four (4) cities and thirteen
(13) municipalities of Metropolitan Manila. (Section 2)
• City and municipal treasurers of the local government

units comprising Metropolitan Manila shall continue
to collect all revenues and receipts accruing to the
Metropolitan Manila Commission and remit the same to
the Authority; Provided, that such income collections as
well as the share of the Authority from the regular sources
of revenue in the General Fund of the city or municipality
as local counterpart for the integrated basic services and
developmental projects shall treated as a trust fund in their
books of account. (Section 7)
• All city and municipal treasurers, municipal assessors,

and their assistants as well as all other officials whose
appointment is currently vested upon the Metropolitan
Manila Commission shall be appointed by the President
of the Philippines, upon recommendation of the Council,
subject to the Civil Service law, rules and regulations.
(Section 8)
• Other treasury and assessment personnel shall be

appointed by the local chief executive in the city or
municipality in accordance with existing laws. (Section 8)
93

LTOM, 2nd EDITION
Laws Provisions
1 January 1992 Section 6. Authority to Create Local Government Units.
Section 7. Creation and Conversion.
Republic Act No. 7160 Section 8. Division and Merger.
An Act Providing for a Local Section 9. Abolition of Local Government Units.
Government Code of 1991, Section 10. Plebiscite Requirement.
otherwise known as "Local Section 11. Selection and Transfer of Local Government
Government Code of 1991 Site, Offices and Facilities.
LGC Book 1’’ Section 18. Power to Generate and Apply Resources
Section 115. Budget Information.
1 January 1992 Section 385. Manner of Creation of Barangays.
Section 386. Requisites for Creation of Barangays.
Section 387. Chief Officials and Offices.
Section 393. Benefits of Barangay Officials.
Republic Act No. 7160 Section 395. Barangay Treasurer: Appointment,
Qualification, Powers and Duties.
Section 441. Manner of Creation of Municipalities.
Section 442. Requisites for Creation of Municipalities.
An Act Providing for a Local Section 443. Officials of the Municipal Government.
Government Code of 1991, Section 449. Manner of Creation of Cities.
otherwise known as "Local Section 450. Requisites for Creation of Cities.
Government Code of 1991 Section 454. Officials of the City Government.
LGC Book 3" (Local Section 460. Manner of Creation of Provinces.
Government Units) Section 461. Requisites for Creation of Provinces.
Section 470. Appointment, Qualifications, Powers, and
Duties of Treasurer.
Section 471. Assistant Treasurer.
Section 472. Qualifications, Powers and Duties of
Assessor.
Section 473. Assistant Assessor.
1 January 1992 Section 513. Failure to Post and Publish the Itemized
Monthly Collections and Disbursements.
Republic Act No. 7160 Section 516. Penalties for Violation of Tax Ordinances.
Section 517. Omission of Property from Assessment or
Tax Rolls by Officers and Other Acts.
An Act Providing for a Local
Section 522. Insurance Coverage.
Government Code of 1991,
Section 523. Personnel Retirement and/or Benefits.
otherwise known as "Local
Section 526. Application of this Code to Local Government
Government Code of 1991
LGC Book 4" Units in the Autonomous Regions.
Section 529. Tax Ordinances or Revenue Measures.
(Miscellaneous and Final
Provisions)
94

FORMS AND ANNEXES
Laws Provisions
13 March 1992 The provisions of existing laws, rules and regulations to the
contrary notwithstanding, no taxes, local and national, shall
Republic Act No. 7227 be imposed within the Subic Special Economic Zone. In lieu
of paying taxes, three percent (3%) of the gross income
An Act Accelerating the earned by all businesses and enterprises within the Subic
Conversion of Military Special Economic Zone shall be remitted to the National
Reservations into other Government, one percent (1 %) each to the local government
Productive Uses, Creating units affected by the declaration of the zone in proportion to
the Bases Conversion their population area, and other factors. In addition, there
and Development is hereby established a development fund of one percent
Authority for the Purpose, (1%) of the gross income earned by all businesses and
Providing Funds Therefor enterprises within the Subic Special Economic Zone to be
and for other purposes, utilized for the development of municipalities outside the
otherwise known as City of Olongapo and the Municipality of Subic, and other
"Bases Conversion and municipalities contiguous to be base areas. [Section 12(c)].
Development Act of
1992". Except as herein provided, the local government units
comprising the Subic Special Economic Zone shall retain
their basic autonomy and identity. The cities shall be
governed by their respective charters and the municipalities
shall operate and function in accordance with Republic
Act No. 7160, otherwise known as the Local Government
Code of 1991. [Section 12(i)].
28 April 1992 Investors, as certified by the Filipino Investors Society and
duly confirmed by the Screening Committee, shall be exempt
Republic Act No. 7459 from payment of license fees, permit feed and other business
taxes in the development of their particular inventions. This
An Act Providing Incentives is an exception to the taxing power of the local government
to Filipino Investors and units. The certification shall state that the manufacture of the
Expanding the Functions of invention is made on a commercial scale.
the Technology Application
and Promotion Institute, Investors shall be exempt from paying any fees involved in
Appropriating Funds their application for registration of their inventions. (Section
Therefor, and for other 5)
Purposes, otherwise known To promote, encourage, develop and accelerate
as “Philippine Investors commercialization of technologies developed by local
and Invention Incentives researchers or adapted locally from foreign sources including
Act’’ inventions, any income derived from these technologies
shall be exempted from all kinds of taxes during the first ten
(10) years from the date of the first sale, subject to the rules
and regulations of the Department of Finance; Provided,
that this tax exemption privilege pertaining to invention shall
be extended to the legal heir or assignee upon the death of
the inventor.
The technologies, their manufacture or sale, shall also

be exempt from payment of license, permit fees, customs
duties and charges on imports. (Section 6)
95

LTOM, 2nd EDITION
Laws Provisions
24 February 1995 Business establishments operating within the Zone shall be
entitled to the existing fiscal incentives as provided for under
Republic Act No. 7922 Presidential Decree No. 66, the law creating the Export
Processing Zone Authority (EPZA), or those provided under
An Act Establishing a Book VI of Executive Order No. 226, otherwise known as the
Special Economic Zone Omnibus Investments Code of 1987 [Section 4(b)].
and Free Port in the
Any provision of existing law, rules or regulations to the
Municipality of Santa
contrary notwithstanding, no taxes, local and national, shall
Ana and the Neighboring
be imposed on business establishments operating within the
Islands in the Municipality
Zone. In lieu of paying taxes, said business establishments
of Aparri, Province of
shall pay and remit to the national government five per
Cagayan, Providing Funds
centum (5%) of their gross income, to be divided as follows:
Therefor, and For Other
Purposes, otherwise known 1. Two per centum (2%) shall accrue to the general fund
as "Cagayan Special of the national government;
Economic Zone Act of
2. One per centum (1 %) to the Province of Cagayan;
1995"
3. One-half per centum (1/2%) to be shared by the
municipalities affected by the declaration of the Zone in
proportion to their income from business activities within
the Zone; and
4. One and one-half per centum (1 1/2%) to the Cagayan
Economic Zone Authority which shall be created under
this Act [Section 4(c)].
24 February 1995 Business establishments operating within the
ECOZONES shall be entitled to the fiscal incentives as
Republic Act No. 7916 provided for under Presidential Decree No. 66, the law
creating the Export Processing Zone Authority, or those
provided under Book VI of Executive Order No. 226,
(as amended by RA 8748) otherwise known as the Omnibus Investment Code of
1987. (Section 23)
• Tax credits for exporters using local materials as Inputs
An Act Providing for the shall enjoy the same benefits provided for in the Export
Legal Framework and Development Act of 1994. (Section 23)
Mechanisms For the • Except for real property taxes on land owned
Creation, Operations, by developers, no taxes, local and national,
Administration, and shall be imposed on business establishments
Coordination of Special operating within the ECOZONE. (Section 24)
Economic Zones in the
Philippines, Creating • All persons and services establishments in the
For This Purpose, The ECOZONE shall be subject to national and local taxes
Philippine Economic Zone under the National Internal Revenue Code and the Local
Authority (PEZA), And For Government Code. (Section 25)
Other Purposes, otherwise • Goods manufactured by an ECOZONE enterprise shall
known as “The Special be made available for immediate retail sales in the
Economic Zone Act of domestic market, subject to payment of corresponding
1995” taxes on the raw materials and other regulations that
may be adopted by the Board of the PEZA. (Section 26)
96

FORMS AND ANNEXES
Laws Provisions
• Without prior Bangko Sentral approval, after tax

profits and other earnings of foreign investments in
enterprises in the ECOZONE may be remitted outward
in the equivalent foreign exchange through any of the
banks licensed by the Bangko Sentral ng Pilipinas in
the ECOZONE: Provided, however, That such foreign
investments in said enterprises have been previously
registered with the Bangko Sentral. (Section 28)
• An additional deduction equivalent to one- half (1/2) of

the value of training expenses incurred In developing
skilled or unskilled labor or for managerial or other
management development programs incurred by
enterprises In the ECOZONE can be deducted from the
national government's share of three percent (3%) as
provided In Section 24. (Section 42)
• An additional deduction equivalent to one- half (1/2) of

the value of training expenses incurred In developing
skilled or unskilled labor or for managerial or other
management development programs incurred by
enterprises In the ECOZONE can be deducted from the
national government’s share of three percent (3%) as
provided In Section 24. (Section 42)
• The PEZA, the Department of Labor and Employment,

and the Department of Finance shall jointly make a
review of the incentive scheme provided In this section
every two (2) years or when circumstances so warrant.
(Section 42)
1 March 1995 The affairs of Metropolitan Manila shall be administered by
the Metropolitan Manila Authority, hereinafter referred to
Republic Act No. 7924 as the MMDA, to replace the Metro Manila Authority (MMA)
“Creating the Metropolitan organized under Executive Order No. 392, series of 1990.
Manila Development (Section 2)
Authority or MM DA”
Sources of Funds and the Operating Budget of MMDA
(Section 10):
a. To carry out the purposes of this Act, the amount of One

billion pesos (P1,000,000,000) is hereby authorized to
be appropriated for the initial operation of the MMDA.
Thereafter, the annual expenditures including capital
outlays of the MMDA shall be provided in the General
Appropriations Act.
b. The MMDA shall continue to receive the Internal

Revenue Allotment (IRA) currently allocated to the
present MMA.

LTOM, 2nd EDITION
Laws Provisions
c. The MMDA is likewise empowered by levy fines, and
impose fees and charges for various services rendered.
d. Five percent (5%) of the total annual gross revenue of

the preceding year, net of the internal revenue allotment,
of each local government unit mentioned in Section 2
hereof, shall accrue and become payable monthly to the
MMDA by each city or municipality. In case of failure to
remit the said fixed contribution, the DBM shall cause the
disbursement of the same to MMDA chargeable against
the IRA allotment of the city or municipality concerned,
the provisions of Section 286 of RA 7160 to the contrary
notwithstanding (Section 10) of the barangay from the
real property and other local taxes. (Section 27)
For purposes of DBM computation of agency income, the

LGUs shall submit on February 28 of each year a statement
of the certified LGU Gross Revenue of the immediately
preceding year as well as a statement of Certified LGU
Gross Revenue estimate of the current year.
In case of failure to remit said fixed contributions, the DBM,

upon request of the Chairman, shall cause its disbursement
to the Authority, chargeable against the IRA share of the City
or Municipality concerned, the provisions of Section 286 of
RA 7160 to the contrary notwithstanding. (Section 28)
1 June 1999 Business establishments operating within the ECOZONE
shall be exempt from national and local taxes, with exemption
Republic Act No. 8748 from real property taxes. In lieu thereof, fiver percent (5%) of
the gross income earned by business enterprises within the
ECOZONE shall be paid and remitted as follows:
1. Three percent (3%) to the National Government; and
2. Two percent (2%) which shall be directly remitted to the

An Act Amending RA No. of the municipality or city where the business enterprise
7916, Otherwise Known is located. (Section 4)
as the “Special Economic All persons and service establishments in the ECOZONE
Zone Act of 1995’’ shall be subject to national and local taxes under the NIRC
and the LGC. (Section 5)
Except for real property taxes on land owned by developers,

no taxes, local and national, shall be imposed on business
establishments operating within the ECOZONE. (Section 24)
All persons and service establishments in the ECOZONE

shall be subject to national and local taxes under the
National Internal Revenue Code and the Local Government
Code.” (Section 25)
98

FORMS AND ANNEXES
Laws Provisions
23 June 1999 The Department shall within six (6) months after the
effectivity of this Act, establish, with the participation of
LGUs, NGOs, POs, the academe and other concerned
Republic Act No. 8749 entities from the private sector, formulate and implement
the Integrated Air Quality Improvement Framework for
a comprehensive air pollution management and control
program. The framework shall, among others, prescribe
An Act Providing for the emission reduction goals using permissible standards,
a Comprehensive Air control strategies and control measures to undertaken
Pollution Control Policy and within a specified time period, including cost-effective use
for Other Purposes. of economic incentives, management strategies, collective
actions, and environmental education and information.
The Integrated Air Quality Improvement Framework shall be

adopted as the official blueprint with which all government
agencies must comply with to attain and maintain ambient
air quality standards. (Section 7)
In coordination with other appropriate government agencies,

the LGUs shall prepare and implement a program and other
measures including relocation, whenever necessary, to
protect the health and welfare of residents in the area.
For those designated as nonattainment areas, the

Department, after consultation with local government
authorities, nongovernment organizations (NGOs), people’s
organizations (POs) and concerned sectors may revise
the designation of such areas and expand its coverage to
cover larger areas depending on the condition of the areas.
(Section 10)
Simultaneous with the issuance of the guideline values

and standards, the Department, through the research
and development program contained in this Act and
upon consultation with appropriate advisory committees,
government agencies and LGUs, shall issue, and from time
to time, revise information on air pollution control techniques.
(Section 11)
Consistent with the provisions of this Act, the Department

shall have the authority to issue permits as it may determine
necessary for the prevention and abatement of air pollution.
Said permits shall cover emission limitations for the

regulated air pollutants to help attain and maintain the
ambient air quality standards. These permits shall serve as
management tools for the LGUs in the development of their
action plan. (Section 16)
99

LTOM, 2nd EDITION
Laws Provisions
The Department, in collaboration with the DOTC, DTI and

LGUs, shall develop an action plan for the control and
management of air pollution from motor vehicles consistent
with the Integrated Air Quality Framework. The DOTC shall
enforce compliance with the emission standards for motor
vehicles set by the Department. The DOTC may deputize
other law enforcement agencies and LGUs for this purpose.
[Section 22 (b)]
Local Government Units (LGUs) shall share the responsibility

in the management and maintenance of air quality within
their territorial jurisdiction. Consistent with Sections 7, 8 and
9 of this Act, LGUs shall implement air quality standards
set by the Board in areas within their jurisdiction; Provided,
however, That in case where the board has not been duly
constituted and has not promulgated its standards, the
standards set forth in this Act shall apply.
The Department shall provide the LGUs with technical

assistance, trainings and a continuing capability-building
program to prepare them to undertake full administration
of the air quality management and regulation within their
territorial jurisdiction. (Section 36)
23 November 1999 The regional or area headquarters and regional operating
headquarters of multinational companies shall be exempt
Republic Act No. 8756 from all kinds of local taxes, fees, or charges imposed by
a local government unit except real property tax on land
An Act Providing for the improvements and equipment. (Article 66 Section 6)
Terms, Conditions and
Licensing Requirements
of Regional or Area
Headquarters, Regional
Operating Headquarters,
and Regional Warehouses
of Multinational Companies,
Amending for the Purpose
Certain Provisions of
Executive Order No. 226,
Otherwise Known as the
Omnibus Investments
Code of 1987. This law
is otherwise known as
“Regional Headquarters
Law’’.
100

FORMS AND ANNEXES
Laws Provisions
June 14, 2000 Notwithstanding any law to the contrary, within two (2) years
from the date of the effectivity of this Act, all departments,
Republic Act No. 8792 bureaus, offices and agencies of the government, as well
as all government-owned and -controlled corporations, that
An Act Providing for the pursuant to law require or accept the filling of documents,
Recognition and Use of require that documents be created, or retained and/
Electronic Commercial or submitted, issue permits, licenses or certificates of
and Non-Commercial registration or approval, or provide for the method and
Transactions and manner of payment or settlement of fees and other
Documents, Penalties for obligations to the government, shall -
Unlawful Use Thereof,
and for other purposes, 1. accept the creation, filing or retention of such documents
otherwise known as in the form of electronic data messages or electronic
"Electronic Commerce documents;
Act of 2000." 2. issue permits, licenses, or approval in the form of
electronic data messages or electronic documents;
3. require and/or accept payments, and issue receipts

acknowledging such payments, through systems using
electronic data messages or electronic documents; or
4. transact the government business and/or perform

governmental functions using electronic data messages
or electronic documents, and for the purpose, are
authorized to adopt and promulgate, after appropriate
public hearing and with due publication in newspapers
of general circulation, the appropriate rules, regulations,
or guidelines, to, among others, xxx (Section 27)
24 February 2001 A municipality or a cluster of barangays may be converted
into a component city if it has a locally generated average
annual income, as certified by the Department of Finance,
Republic Act No. 9009 of at least One hundred million pesos (P100,000,000.00) for
the last two (2) consecutive years based on 2000 constant
“An Act Amending Section prices, and if it has either of the following requisites:
450 of RA No. 7160,
Otherwise Known as The • a contiguous territory of at least one hundred (100)
Local Government Code square kilometers, as certified by the Land Management
of 1991, By Increasing Bureau; or
The Average Annual • a population of not less than one hundred fifty thousand
Income Requirement for a (150,000) inhabitants, as certified by the National
Municipality or Cluster of Statistics Office.
Barangays to be Converted
into a Component City” The territorial jurisdiction of a newly created city shall be
properly identified by metes and bounds. The requirement
on land area shall not apply where the city proposed to
be created is composed of one (1) or more islands. The
territory need not be contiguous if it comprises two (2) or
more islands.
101

LTOM, 2nd EDITION
Laws Provisions
The average annual income shall include the income
accruing to the general fund, exclusive of special funds,
transfers, and non-recurring income.
8 June 2001 The obligations of generating companies and energy

resource developers to communities hosting energy
generating facilities and/or energy resource developers as
defined under Chapter II, Sections 289 to 294 of the Local
Republic Act No. 9136 Government Code and Section 5(i) of Republic Act No. 7638
and their implementing rules and regulations and applicable
orders and circulars consistent with this Act shall continue:
Provided, further, That the obligations mandated under
Chapter II, Section 291 of Republic Act No. 7160, shall
An Act Ordaining Reforms apply to privately-owned corporations or entities utilizing the
in the Electric Power national wealth of the locality.
Industry, Amending for the
Purpose Certain Laws and To ensure the effective implementation of the reduction in cost
For Other Purposes, of electricity in the communities where the source of energy
otherwise known as is located, the mechanics and procedures prescribed in the
“Electric Power Industry Department of the Interior and Local Government (DILG)-
Reform Act of 2001” or DOE Circulars No. 95-01 and 98-01 dated 31 October 1995
“EPIRA Law” and 30 September 1998, respectively and other issuances
related thereto shall be pursued.
Towards this end, the fund generated from the eighty percent
(80%) of the national wealth tax shall, in no case, be used by
any local government unit for any purpose other than those
for which it was intended. (Section 66.)
13 November 2002 The Office of the Treasurer of each city or municipality shall
register the BMBE’s and issue a Certificate of Authority to
Republic Act No. 9178 enable the BMBE to avail of the benefits under this Act.
Any such applications shall be processed within fifteen (15)
An Act to Promote the working days upon submission of complete documents.
Establishment of Barangay Otherwise, the BMBEs shall be deemed registered. The
Micro Business Enterprises Municipal or City Mayor may appoint a BMBE Registration
(BMBEs), Providing Officer who shall be under the Office of the Treasurer. Local
Incentives and Benefits government units (LGU’s) are encouraged to establish
Therefor, and for other a One-Stop-business Registration Center to handle the
Purposes. efficient registration and processing of permits/licenses of
BMBEs. Likewise, LGUs shall make a periodic evaluation
of the BMBE’s financial status for monitoring and reporting
purposes.
The LGUs shall issue the Certificate of Authority promptly

and free of charge. However, to defray the administrative
costs of registering and monitoring the BMBEs, the LGUs
may charge a fee renewal.
102

FORMS AND ANNEXES
Laws Provisions
The Certificate of Authority shall be effective for a period of
two (2) years, renewable for a period of two (2) years for
every renewal.
As much as possible, BMBEs shall be subject to minimal

bureaucratic requirements and reasonable fees and
charges. (Section 4)
The BMBE shall report to the city or municipality of any

changer in the status of its ownership structure, and shall
surrender the original copy of the BMBE Certificate of
Authority for notation of the transfer. (Section 6)
All BMBEs shall be exempt from tax for income arising from
the operations of the enterprise.
The LGUs are encouraged either to reduce the amount of

local taxes, fees and charges imposed or to exempt BMBEs
from local taxes, fees and charges. (Section 7)
10 January 2003 All procurement of the national government, its departments,
bureaus, offices and agencies, including state universities
Republic Act No. 9184 and colleges, government-owned and/or -controlled
corporations, government financial institutions and local
“An Act Providing for government units, shall, in all cases, be governed by these
the Modernization, principles (Section 3):
Standardization and
Regulation of the • Transparency in the procurement process and in the
Procurement Activities of implementation of procurement contracts.
the Government and for • Competitiveness by extending equal opportunity to
Other Purposes”, otherwise enable private contracting parties who are eligible and
known as “Procurement qualified to participate in public bidding
Law”
• Streamlined procurement process that will uniformly
apply to all government procurement. The procurement
process shall be simple and made adaptable to
advances in modern technology in order to ensure an
effective and efficient method.
• System of accountability where both the public officials

directly or indirectly involved in the procurement process
as well as in the implementation of procurement contracts
and the private parties that deal with government are,
when warranted by circumstances, investigated and
held liable for their actions relative thereto.
• Public monitoring of the procurement process and the

implementation of awarded contracts with the end in
view of guaranteeing that these contracts are awarded
pursuant to the provisions of this Act and its implementing
rules and regulations, and that all these contracts are
performed strictly according to specifications.
103

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This Act shall apply to the Procurement of Infrastructure

Projects, Goods, and Consulting Services, regardless of
source of funds, whether local or foreign, by all branches
and instrumentalities of government, its departments,
offices and agencies, including government-owned and/or
-controlled corporations and local government units, subject
to the provisions of Commonwealth Act No. 138. Any treaty
or international or executive agreement affecting the subject
matter of this Act to which the Philippine government is a
signatory shall be observed. (Section 4)
The GPPB shall be composed of the Secretary of the

Department of Budget and Management, as Chairman,
the Director-General of the National Economic and
Development Authority, as Alternate Chairman, with the
following as Members; the Secretaries of the Departments
of Public Works and Highways, Finance, Trade and Industry,
Health, National Defense, Education, Interior and Local
Government, Science and Technology, Transportation and
Communications, and Energy, or their duly authorized
representatives and a representative from the private sector
to be appointed by the President upon the recommendation
of the GPPB. The GPPB may invite a representative from
the Commission on Audit to serve as a resource person.
(Section 64)
22 March 2004 Each LGU may raise funds to subsidize the necessary
expenses for the operation and maintenance of sewerage
Republic Act No. 9275 treatment or septage facility servicing their area of jurisdiction
through local real property taxes and enforcement of a
An Act Providing for a service fee system.
Comprehensive Water
Quality Management and The DENR shall implement a wastewater charge system in
for Other Purposes all management areas through the collection of wastewater
charges/fees. (Section 7)
A water quality management fund, to be administered by the

Department, in coordination with other concerned agencies,
as a special account in the National Treasury is hereby
established.
The fines imposed and damages awarded to the government

by the Pollution Adjudication Board (PAB), proceeds of
permits issued by the Department under this Act, donations,
endowments and grants in the form of contributions to the
national government under this Act shall form part of the
fund. Such donations, endowments and grants shall be
exempt from donor’s taxes and all other taxes, charges or
fees imposed by the government and shall be deductible
from the gross income of the donor for income tax purposes.
(Section 9)
104

FORMS AND ANNEXES
Laws Provisions
Rewards, monetary or otherwise, shall be provided to
individuals, private organization and entities, including civil
society, that have undertaken outstanding and innovative
projects, technologies, processes and techniques or
activities in water quality management. Said rewards shall
be sourced from the Water Quality Management Fund
herein created. (Section 25)
An incentive scheme is hereby provided for the purpose of

encouraging LGUs, water districts (WDs), enterprises, or
private entities, and individuals, to develop or undertake an
effective water quality management, or actively participate
in any program geared towards the promotion thereof as
provided in this Act. (Section 26)
20 March 2007 Business enterprises presently registered and granted
with tax and duty incentives by the Clark Development
Corporation (CDC), Poro Point Management Corporation
Republic Act No. 9400 (PPMC), JHMC, and Bataan Technological Park Incorporated
(BTPI), including such governing bodies, shall be entitled
to the same incentives until the expiration of their contracts
entered into prior to the effectivity of this Act. (Section 7)
An Act Amending Republic
Act No. 7227, as amended, These provisions express that the following Special
otherwise known as the Economic Zones will be exempted in paying all national and
Bases Conversion local taxes. In lieu of said taxes, a five percent (5%) tax on
and Development Act gross income earned shall be paid by all registered business
of 1992”, and For Other enterprises within the EZs and shall be directly remitted as
Purposes follows: three percent (3%) to the National Government, and
two percent (2%) to the treasurer’s office ofthe municipality
or city where they are located.
Section 12. Subic Special Economic Zone

Section 15. Clark Special Economic Zone (CSEZ)
and Clark Freeport Zone (CFZ).
Section 15-A. Poro Point Freeport Zone (PPFZ)
Section 15-B. Morong Special Economic Zone (MSEZ)
Section 15-C. John Hay Special Economic Zone (JHSEZ)
105

LTOM, 2nd EDITION
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29 June 2007 The Aurora Special Economic Zone Authority (ASEZA)
may administer the following incentives to the registered
enterprises located therein to the extent of the activity/
Republic Act No. 9490 project:
A. Income Tax Holiday (ITH) (Section 5)
An Act Establishing the Imposition of a tax rate of five percent (5%) on Gross Income
Aurora Special Economic Earned (GIE) - Except for real property tax on land, no local
Zone in the Province and national taxes as prescribed under Republic Act No.
of Aurora, Creating for 8424, also known as - The National Internal Revenue Code
the Purpose the Aurora of 1997, as Amended - such as income tax, excise tax and
Special Economic Zone franchise taxes, shall be imposed on registered enterprises
Authority, Appropriating operating within the Aurora Ecozone. In lieu thereof, five
Funds Therefor and for percent (5%) of the gross income earned shall be paid as
Other Purposes, otherwise follows:
known as ‘‘Aurora Special 1. Three percent (3%) to the national government; and
Economic Zone Act of
2007” 2. Two percent (2%) shall be remitted by the business
establishments to the treasurer’s office ofthe municipality
or city where the enterprise is located.
All persons and service establishments in the Aurora

Ecozone shall be subject to national and local taxes under
the National Internal Revenue Code of 1997, as amended,
and the Local Government Code. [Section 5(c)].
3 August 2007 In order to ascertain, assess, and collect the correct amount
of local taxes, fees or charges, the BIR records pertaining
to any person, partnership, corporation or association
Executive Order No. 646 subject to local taxes, fees, and charges shall be made
available to the local treasurer, his deputy or duly authorized
representative. (Section 1)
Accessibility of Information For the purpose of ascertaining the correctness of any

on Taxpayers between the return, or in making a return when none has been made,
Bureau of Internal Revenue or in determining the liability of any person for any internal
and the Local Government revenue tax, or in collecting any such liability, or in evaluating
Units for Tax Collection tax compliance, the LGUs, upon proper request of the
Commissioner of Internal Revenue or his duly authorized
representative, shall provide the BIR with any information
such as, but not limited to, costs and volume of production,
receipts or sales, and gross incomes of taxpayers. (Section 2)
The LGUs’ access to records of, or information provided for

by, BIR and vice versa shall be utilized for the aforementioned
purposes only, and shall not be used for any other purpose,
or disclosed to unauthorized persons. (Section 3)
106

FORMS AND ANNEXES
Laws Provisions
The Department of Finance shall prepare and issue the

necessary guidelines for the effective implementation of this
Executive Order, with due regard to the security of taxpayers’
information. (Section 4)
16 December 2008 RE developers of renewable energy facilities, including
hybrid systems, in proportion to and to the extent of the RE
Republic Act No. 9513 component, for both power and non-power applications,
as duly certified by the DOE, in consultation with the BOI,
Renewable Energy Act of shall be entitled to the following incentives:
2008 - An Act Promoting
the Development, Utilization xxx
and Commercialization c. Special Realty Tax Rates on Equipment and Machinery.
of Renewable Energy - Any law to the contrary notwithstanding, realty and
Resources and for Other other taxes on civil works, equipment, machinery, and
Purposes to be known as other improvements of a Registered RE Developer
"Renewable Energy Act actually and exclusively used for RE facilities shall not
of 2008". '
exceed one and a half percent (1.5%) of their original
cost less accumulated normal depreciation or net book
value: Provided, That in case of an integrated resource
development and generation facility as provided under
Republic Act No. 9136, the real property tax shall only
be imposed on the power plant. (Section 15)
19 December 2008 Appropriation and Sources of Income, xxx
b. To partially provide for the funding of the fire service

the following taxes and fees which shall accrue to the
Republic Act No. 9514 General Fund of the National Government, are hereby
imposed:
An Act Establishing 1. Fees to be charged for the issuance of certificates,

A Comprehensive Fire permits and licenses as provided for in Section 7 (a)
Code of the Philippines, hereof;
Repealing Presidential 2. One-tenth of one per centum (0.1 %) of the verified
Decree No. 1185 and For estimated value of buildings or structures to be
Other Purposes otherwise erected, from the owner thereof, but not to exceed
known as the “Revised Fire fifty thousand (P50,000.00) pesos, one half to be
Code of the Philippines of paid prior to the issuance of the building permit, and
2008". the balance, after final inspection and prior to the
issuance of the use and occupancy permit;
3. One-hundredth of one per centum (0.10%) of the

assessed value of buildings or structures annually
payable upon payment of the real estate tax, except
on structures used as single family dwellings;
107

LTOM, 2nd EDITION
Laws Provisions
4. Two per centum (2%) of all premiums, excluding re
insurance premiums for the sale of fire, earthquake
and explosion hazard insurance collected by
companies, persons or agents licensed to sell such
insurances in the Philippines;
5. Two per centum (2%) of gross sales of companies,

persons or agents selling fire fighting equipment,
appliances or devices, including hazard detection
and warning systems; and
6. Two per centum (2%) of the service fees received

from fire, earthquake, and explosion hazard
reinsurance surveys and post loss service of
insurance adjustment companies doing business in
the Philippines directly through agents. (Section 12)
The collection and assessment of taxes, fees and fines as

prescribed in the Local Government Code, except those
contained in this Code, shall be the function of the concerned
local government units. [(Section 13(b)]
17 February 2009 Chapter V of this Act provides the provisions on
Responsibilities, Rights and Privileges of Cooperatives such
as:
Tax Treatment of Cooperative - Duly registered cooperatives

Republic Act No. 9520 under this Code which do not transact any business with
non-members or the general public shall not be subject to
any taxes and fees imposed under the internal revenue laws
and other tax laws. Cooperatives not falling under this article
An Act Amending the shall be governed by the succeeding section. (Article 60)
Cooperative Code of the
Philippines to be known Tax and Other Exemptions - Cooperatives transacting
as the “The Philippine business with both members and non-members shall not
Cooperative Code of be subjected to tax on their transactions with members.
2008”. In relation to this, the transactions of members with the
cooperative shall not be subject to any taxes and fees,
including not limited to final taxes on members’ deposits
and documentary tax. Notwithstanding the provisions of any
law or regulation to the contrary, such cooperatives dealing
with nonmembers shall enjoy the following tax exemptions:
“(1) Cooperatives with accumulated reserves and

undivided net savings of not more than Ten million pesos
(P10,000,000.00) shall be exempt from all national, city,
provincial, municipal or barangay taxes of whatever
name and nature. Such cooperatives shall be exempt
from customs duties, advance sales or compensating
taxes on their importation of machineries, equipment and
spare parts used by them and which are not available
locally a certified by the Department of Trade and Industry
108

FORMS AND ANNEXES
Laws Provisions
(DTI). All tax free importations shall not be sold nor the
beneficial ownership thereof be transferred to any person
until after five (5) years, otherwise, the cooperative and
the transferee or assignee shall be solidarily liable to
pay twice the amount of the imposed tax and I or duties.
"(2) Cooperatives with accumulated reserves and divided

net savings of more than Ten million pesos (P10,000,000.00)
shall fee the following taxes at the full rate:
“(a) Income Tax
“(b) Value-Added Tax
“(c) All other taxes unless otherwise provided herein; and
“(d) Donations to charitable, research and educational

institutions and reinvestment to socioeconomic projects
within the area of operation of the cooperative
“(3)All cooperatives, regardlessoftheamountofaccumulated

reserves and undivided net savings shall be exempt from
payment of local taxes and taxes on transactions with
banks and insurance companies: Provided, That all sales
or services rendered for non-members shall be subject to
the applicable percentage taxes sales made by producers,
marketing or service cooperatives: Provided further, That
nothing in this article shall preclude the examination of
the books of accounts or other accounting records of the
cooperative by duly authorized internal revenue officers
for internal revenue tax purposes only, after previous
authorization by the Authority. (Article 61)
21 May 2009 Section 140 of Republic Act No. 7160, otherwise known as
“The Local Government Code of 1991”, is hereby amended
Republic Act No. 9640 to read as follows:
An Act Amending Section • SEC. 140. Amusement Tax. - (a) The province may levy
140 (A) of RA No. 7160, an amusement tax to be collected from the proprietors,
Otherwise Known as “The lessees, or operators of theaters, cinemas, concert halls,
Local Government Code of circuses, boxing stadia, and other places of amusement
1991”, otherwise known as at a rate of not more than ten percent (10%) of the gross
“Amusement Tax” receipts from the admissions fees.
• In the case of theaters or cinemas, the tax shall first be

deducted and withheld by their proprietors, lessees, or
operators and paid to the provincial treasurer before
the gross receipts are divided between said proprietors,
lessees, or operators and the distributors of the
cinematographic films.
109

LTOM, 2nd EDITION
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• The holding of operas, concerts, dramas, recitals,
paintings, and art exhibitions, flower shows, musical
programs, literary and oratorical presentations, except
pop, rock, or similar concerts shall be exempt from the
payment of the tax herein imposed.
• The sangguniang panlalawigan may prescribe the time,

manner, terms and conditions for the payment of tax. In
case of fraud or failure to pay the tax, the sangguniang
panlalawigan may impose such surcharges, interest
and penalties, as it may deem appropriate.
• The proceeds from the amusement tax shall be shared

equally by the province and the municipality where such
amusement places are located.
27 July 2009 This Act provides for the development of policies and plans
and the implementation of actions and measures pertaining
Republic Act No. 10121 to all aspects of disaster risk reduction and management,
including good governance, risk assessment and early
“An Act Strengthening warning, knowledge building and awareness raising,
The Philippines Disaster reducing underlying risk factors, and preparedness for
Risk Reduction and effective response and early recovery. (Section 4)
Management System,
Providing for the The present Local Calamity Fund shall henceforth be known
National Disaster as the Local Disaster Risk Reduction and Management Fund
Risk Reduction and (LDRRMF). Not less than five percent (5%) of the estimated
Management Framework revenue from regular sources shall be set aside as the
and Institutionalizing LDRRMF to support disaster risk management activities
the National Disaster such as, but not limited to, pre-disaster preparedness
Risk Reduction and programs including training, purchasing life-saving rescue
Management Plant, equipment, supplies and medicines, for post-disaster
Appropriating Funds activities, and for the payment of premiums on calamity
Therefor And For Other insurance. The LDRRMC shall monitor and evaluate the use
Purposes”, otherwise and disbursement of the LDRRMF based on the. LDRRMP
known as “NDRRMC Law” as incorporated in the local development plans and annual
work and financial plan. Upon the recommendation of the
LDRRMO and approval of the sanggunian concerned, the
LDRRMC may transfer the said fund to support disaster
risk reduction work of other LDRRMCs which are declared
under state of calamity. (Section 21)
Of the amount appropriated for LDRRMF, thirty percent

(30%) shall be allocated as Quick Response Fund (QRF)
or stand-by fund for relief and recovery programs in order
that situation and living conditions of people In communities
or areas stricken by disasters, calamities, epidemics, or
complex emergencies, may be normalized as quickly as
possible. (Section 21)
110

FORMS AND ANNEXES
Laws Provisions
Unexpended LDRRMF shall accrue to a special trust fund
solely for the purpose of supporting disaster risk reduction
and management activities of the LDRRMCs within the next
five (5) years. Any such amount still not fully utilized after
five (5) years shall revert back to the general fund and will
be available for other social services to be identified by the
local sanggunian. (Section 21)
The present Calamity Fund appropriated under the annual

General Appropriations Act shall henceforth be known as
the National Disaster Risk Reduction and Management
Fund (NDRRM Fund) and it shall be used for disaster
risk reduction or mitigation, prevention and preparedness
activities such as but not limited to training of personnel,
procurement of equipment, and capital expenditures. It
can also be utilized for relief, recovery, reconstruction and
other work or services in connection with natural or human
induced calamities which may occur during the budget year
or those that occurred in the past two (2) years from the
budget year. [Section22(a)]
23 October 2009 The registered enterprises operating within the FAB may
be entitled to the existing pertinent fiscal incentives as
Republic Act No. 9728 provided for under Republic Act No. 7916, as amended
by Republic Act No. 8748, also known as the Special
An Act Converting the Economic Zone Act of 1995, or those provided under
Bataan Economic Zone Executive Order No. 226, as amended, otherwise known
Located in the Municipality as the Omnibus Investment Code of 1987. (Section 5)
of Mariveles, Province of
Bataan, into the Freeport No taxes, local and national, shall be imposed on business
Area of Bataan (FAB), establishments operating within the FAB. In lieu thereof,
Creating for this purpose said business establishments shall pay a five percent (5%)
the Authority of the final tax on their gross income earned in the following
Freeport Area of Bataan percentages:
(AFAB), Appropriating 1. Oneper centum (1 %) to the National Government;
Funds Therefor and for
other purposes, otherwise 2. One per centum (1 %) to the Province of Bataan;
known as "Freeport Area
of Bataan (FAB) Act of 3. One per centum (1 %) to the treasurer's office of the
2009”. Municipality of Mariveles; and
4. Two per centum (2%) to the Authority of the Freeport

of Area of Bataan. (Section 6)
111

LTOM, 2nd EDITION
Laws Provisions
22 April 2010 The Aurora Ecozone may provide incentives such as
tax and duty-free importations of raw materials, capital
Republic Act No. 10083 and equipment to registered enterprises located therein.
However, exportation or removal of goods from the territory
An Act Amending Republic of the Aurora Ecozone to the other parts of the Philippine
Act No. 9490, otherwise territory shall be subject to customs duties and taxes under
known as ‘‘Aurora Special the Tariff and Customs Code of the Philippines, as amended,
Economic Zone Act of and the National Internal Revenue Code (NIRC) of 1997, as
2007” amended. [Section 3(f)]
Imposition of a tax rate of five percent (5%) on Gross Income
Earned (GIE). - Except for real property tax on land, no local
and national taxes as prescribed under Republic Act No.
8424, also known as "The National Internal Revenue Code
of 1997, as Amended" such as income tax, excise tax and
franchise taxes, shall be imposed on registered enterprises
operating within the Aurora Ecozone. In lieu thereof, five
percent (5%) of the gross income earned shall be paid as
follows:
“(a) Three percent (3%) to the national government;
“(b) One percent (1%) shall be remitted by the business
establishments in equal shares to the respective treasurer’s
office of the province and the municipality where the
enterprise is located; and
“(c) One percent (1%) shall be remitted by the registered

enterprises to the APECO.
“All persons and service establishments in the Aurora

Ecozone shall be subject to national and local taxes under
the National Internal Revenue Code of 1997, as amended,
and the Local Government Code. [Section 4(c)].
13 November 2002 This Act does not apply to the following:
xxx
Republic Act No. 10173 Information relating to any discretionary benefit of a financial
nature such as the granting of a license or permit given by
the government to an individual, including the name of the
An Act Protecting Individual individual and the exact nature of the benefit
Personal Information and Information necessary in order to carry out the functions of
Communications Systems public authority which includes the processing of personal
in the Government and the data for the performance by the independent, central
Private Sector, Creating monetary authority and law enforcement and regulatory
for this Purpose a National agencies of their constitutionally and statutorily mandated
Privacy Commission, functions. Nothing in this Act shall be construed as to have
and for other Purpose, amended or repealed Republic Act No. 1405, otherwise
otherwise known as “Data known as the Secrecy of Bank Deposits Act; Republic Act
Privacy Act of 2012” No. 6426, otherwise known as the Foreign Currency Deposit
Act; and Republic Act No. 9510, otherwise known as the
Credit Information System Act (CISA);

FORMS AND ANNEXES
Laws Provisions
Information necessary for banks and other financial
institutions under the jurisdiction of the independent, central
monetary authority or Bangko Sentral ng Pilipinas to comply
with Republic Act No. 9510, and Republic Act No. 9160, as
amended, otherwise known as the Anti-Money Laundering
Act and other applicable law [(Section 4 ( c ) ( e ) (f)]
11 October 2016 Ambisyon Natin 2040 is a national long-term vision that will
serve as a guide for development planning. To ensure sound
Executive Order. No. 5, macroeconomic policy, local government units (LGUs) shall
Series of 2016 remain dependent on the Internal Revenue Allotment (IRA).
Responsible, strategic and supportive fiscal sector can be
Approving and Adopting
achieved by:
the Twenty-Five-Year 1. Increasing local sources of LGU revenue, institute

Long Term Vision Entitled legislated and non-legislated measures - LGUs need to
maximize the revenue-raising powers granted to them
Ambisyon Natin 2040 as
by the Local Government Code. Among the potential
Guide for Development measures are a) professionalization of local treasurers
Planning, otherwise known through the Standardized Examination and Assessment
as ‘‘Ambisyon Natin for Local Treasury Service Program; b) updating key
local finance manuals to take into account developments
2040”
in local finance; c) intensifying LGU fiscal monitoring and
performance evaluation through standardized reporting
tools and metrics; d) establishing the idle land tax in
all LGUs; and e) enjoining LGUs to comply with LGC
requirements concerning local revenue base; and
2. Formulating and implementing expenditure

management reforms - Several measures will be put in
place to improve agency budget utilization and address
underspending. These include: a) strengthening the
linkage between planning and budgeting; b) capacity
building for line agencies and other stakeholders; c)
streamlining the release of funds and development of
integrated and user-friendly financial management
system; d) strengthening project monitoring through
modern technology such as integrated systems,
geotagging and mapping; and e) developing a codex for
consistent and efficient application of the Commission
on Audit Rules.
113

LTOM, 2nd EDITION
Laws Provisions
19 December 2017 Authority of the Commissioner to Prescribe Real Property
Values.— The Commissioner is hereby -authorized to divide
Republic Act No. 10963 the Philippines into different zones or areas and shall, upon
An Act Amending Sections mandatory consultation with competent appraisers both
5, 6, 24, 25, 27, 31,32, 33, from the private and public sectors, and with prior notice to
34, 51, 52, 56, 57, 58, 74, affected taxpayers, determine the fair market value af real
79, 84, 86, 90, 91,97, 99, properties located in each zone or area, subject to automatic
100, 101, 106, 107, 108, adjustment once every three (3) years through rules and
109, 110, 112, 114, 116, regulations issued by the Secretary of Finance based on the
127, 128, 129, 145, 148, current Philippine valuation standards: Provided, That no
149, 151, 155, 171, 174, adjustment in zonal valuation shall be valid unless published
175, 177, 178, 179, 180, in a newspaper of general circulation in the province, city or
181, 182, 183, 186, 188, municipality concerned, or in the absence thereof, shall be
189, 190, 191, 192, 193,
current Philippine valuation standards: Provided, That no
194, 195, 196, 197, 232,
adjustment in zonal valuation shall be valid unless published
236, 237, 249, 254, 264,
in a newspaper of general circulation in the province, city or
269, and 288; Creating
municipality concerned, or in the absence thereof, shall be
New Sections 51-A, 148-A,
posted in the provincial capitol, city or municipal hall and in
150-A, 150-B, 237-A, 264-
two (2) other conspicuous public places therein: Provided,
A, 264-B, and 265-A; and
further, That the basis of any valuation, including the records
Repealing Sections 35, 62,
of consultations done, shall be public records open to the
And 89; All Under Republic
inquiry of any taxpayer. For purposes of computing any
Act No. 8424, Otherwise
internal revenue tax, the value of the property shall be,
Known as the National
whichever is the higher of:
Internal Revenue Code of
1997, as Amended, and for “(1) the fair market value as determined by the
Other Purposes. This law Commissioner; or
is better known as “Tax
Reform for Acceleration
“(2) the fair market value as shown in the schedule of
values of the Provincial and City Assessors. [Section
and Inclusion (TRAIN)
Law” 4(e)]
3 November 2015 A duly registered and accredited Microfinance NGO shall

pay a two percent (2%) tax based on its gross receipts from
Republic Act No. 10693 microfinance operations in lieu of all national taxes: Provided,
That preferential tax treatment shall be accorded only to
An Act Strengthening NGOs whose primary purpose is microfinance and only on
Nongovernment their microfinance operations catering to the poor and low-
Organizations (NGOs) income individuals in alignment with the main goal of this
Engaged in Microfinance Act to alleviate poverty. The non-microfinance activities of
Operations for the Poor, Microfinance NGOs shall be subject to all applicable regular
otherwise known as taxes.
‘Microfinance NGOs Act”
Duly registered and accredited Microfinance NGOs, as
well as their clients, shall be required to have a Taxpayer
Identification Number (TIN): Provided, That this shall be
accomplished within a reasonable time as prescribed, by
the Council: Provided, further, That the relevant government
agencies, in coordination with the Council, shall provide
simplified forms and procedures for securing the TIN.
(Section 20)
114

FORMS AND ANNEXES
Laws Provisions
28 May 2018 All government agencies shall set up a Citizen’s Charter
indicating the most current and updated service standards.
Republic Act No. 11032 (Section 6)
An Act Promoting the No government officer or employee shall have any contact,
Ease of Doing Business in any manner, except during the preliminary assessment
and Efficient Delivery of and evaluation of submitted documents, unless strictly
Government Services, necessary with any application or requesting party
Amending for the Purpose concerning an application or request. (Section 7)
Republic Act No. 9485,
Otherwise Known as the All applications or requests submitted shall be acted upon
“Red Tape Act of 2007, by the assigned officer or employee within the prescribed
and for Other Purposes”. working period which shall not be longer than three (3)
working days in the case of simple transactions and seven
(7) working days in the case of complex transactions from
the date of request and/or complete application or request
was received.
Accessing Government Services; Acceptance of

Applications or Requests; Action of Offices. (Section 9)
Automatic Approval or Automatic Extension of License,
Clearance, Certification or Authorization (Section 10)
A single or unified business application form shall be
used in processing new applications for business permits
and business renewals which consolidates all the
information of the applicant or requesting party by various
local governmentdepartments, such as, but not limited
to, the local taxes and clearances, building clearance,
sanitary permit, zoning clearance, and other specific LGU
requirements, including the fire clearance from the Bureau
of Fire Protection (BFP).
The unified forms shall be made available either online using

technology-neutral platforms and thru hard copies which
shall likewise be made available at all times in designated
areas of the concerned office and/or agency. [Section 11 (a)]
A Business One Stop Shop (BOSS) for the city/municipality ’s

business permitting and licensing system to receive and
process manual and/or electronic submission of application
for license, clearance, permit, certification, or authorization
shall be established within the cities/municipalities’ Negosyo
and other relevant city/municipality offices/departments,
among others, engaged in starting a business, dealing with
construction permits. [Section 11(b)]
Cities/Municipalities are mandated to automate their

business permitting and licensing system or set up an
electronic BOSS for a more efficient business registration
processes. [Section 11(c)]
115

LTOM, 2nd EDITION
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Other local clearances such as, but not limited to, sanitary
permits, environmental and agricultural clearances shall be
issued together with the business permit. [Section 11(d)]
Business permits shall be valid for one (1) year. The city/
municipality may have the option to renew business permits
within the first month of the year or on the anniversary date
of the issuance of the business permit. [Section 11(e)]
27 July 2018 There is hereby created a Bangsamoro Regional Office
of the Bureau of Local Government Finance under the
Republic Act No. 11054 Department of Finance which shall have the authority
to coordinate, assist, and monitor the treasury and
An Act Providing for assessments operations of constituent local government
the Organic Law for the units within the Bangsamoro Autonomous Region in
Bangsamoro Automous pursuance of good governance and local autonomy. The
Region in Muslim regional office shall be guided by the standards set by
Mindanao, Repealing for the Department of Finance-Bureau of Local Government
the Purpose Republic Finance including the requirements set for the appointment
Act No. 6734, Entitled of local treasurers. (Section 3)
"An Act Providing for
An Organic Act for the The Bangsamoro Government may create its own sources
Autonomous Region in of revenues, and may levy taxes, fees and charges, subject
Muslim Mindanao," As to the provisions of the Organic Law which shall accrue
Amended by Republic exclusively to the Bangsamoro Government.
Act No. 9054, Entitled Article XII of this Law provides the provisions on Fiscal
"An Act to Strengthen Autonomy.
and Expand the Organic The constituent local government units in the Bangsamoro
Act for the Autonomous Autonomous Region shall continue to exercise the taxing
Region in Muslim powers granted under Republic Act No. 7160, otherwise
Mindanao", otherwise known as the Local Government Code, as amended.
known as the “Organic (Article XII Section 6)
Law for the Bangsamoro
Autonomous Region in The Parliament may grant tax exemptions and incentives
Muslim Mindanao." or which shall not diminish national revenues provided that the
“BBL" grant of tax exemption and incentives as provided for under
Executive Order No. 458, series of 1991, otherwise known
as the “Omnibus Investments Code” shall continue to apply.
(Article XII Section 8)
Limitations on the Taxing Powers; Exceptions (Article XII

Section 8)
National Government taxes, fees, and charges collected,

other than tariff and customs duties, shall be shared as
follows:
(a) Twenty-five percent (25%) to the National Government

provided that for the first ten (10) years upon the effectivity of
the Organic Law, the share shall accrue to the Bangsamoro
Government, provided, further, that after the first ten (10)-
year period, the National Government may extend the period
116

FORMS AND ANNEXES
Laws Provisions
upon petition of the Bangsamoro Government. (Article XII
Section 10)
The Bangsamoro Revenue Office shall be established for

the assessment and collection of taxes in the Bangsamoro
Autonomous Region. (Article XII Section 11) Payment of
Taxes by Corporations, Partnerships or Firms. (Article XII
Section 12)
The Parliament shall enact a law detailing the shares of

constituent LGUs in the seventy-five (75%) share of the
Bangsamoro Government in the national taxes, fees, and
charges collected in the Bangsamoro territorial jurisdiction.
(Article XII Section 13)
Related Laws - LTOM:
1. RA No. 2264 - An Act Amending the Laws Governing Local Governments by

Increasing their Autonomy and Reorganizing Provincial Governments
(19 June 1959)
2. RA No. 2370 - Barrio Charter (1 January 1960)
3. RA No. 5185 - Decentralization Act of 1967 (12 September 1967)
4. RA No. 6541 - National Building Code of the Philippines (26 August 1972)
5. PD No. 231 - Local Tax Code (1 July 1973)
6. PD No. 464 - Real Property Tax Code (20 May 1974)
7. PD No. 477 - Decree on Local Fiscal Administration (3 June 1974)
8. PD No. 526 - Supply Management (2 August 1974)
9. PD No. 705 - Revising Presidential Decree No. 389, otherwise known as the Forestry
Reform Code of the Philippines (19 May 1975)
10. PD No. 752 - Credit Financing for Local Governments (25 June 1975)
11. PD No. 853 - Providing for the Classification and Valuation of Timber and Forest Lands
for Purposes of Real Property Tax (19 December 1975)
12. PD No. 921 - Providing for the Administration of Local Financial Services in
Metropolitan Manila, creating Local Treasury and Assessment Districts
therein (12 April 1976)
13. PD No. 1375 - Transferring to the Budget Commission the functions of the
Local Government Budget Administration (16 May 1978)
14. Batas Pambansa No. 337 -The Local Government Code (10 February 1983)
15. EO No. 226 - The Omnibus Investments Code of 1987 (16 July 1987)
16. EO No. 392 - Constituting the Metropolitan Manila Authority (9 January 1990)
17. RA No. 7160 - Local Government Code of 1991 (LGC Books 1 to 4) (1 January 1992)
18. RA No. 7227 - Bases Conversion and Development Act of 1992 (13 March 1992)
19. RA No. 7459 - Philippine Investors and Invention Incentives Act - (28 April 1992)
20. RA No. 7922 - Cagayan Special Economic Zone Act of 1995 (24 February 1995)
21. RA No. 7916 (as amended by RA 8748) - The Special Economic Zone Act of 1995
(24 February 1995)
22. RA No. 7924 - Creating the Metropolitan Manila Development Authority or MMDA (1
March 1995)
23. RA No. 8748 - An Act Amending RA No. 7916, Otherwise Known as the “Special
Economic Zone Act of 1995” (1 June 1999)
117

LTOM, 2nd EDITION
24. RA No. 8749 - An Act Providing for a Comprehensive Air Pollution Control Policy and
for Other Purposes. (23 June 1999)
25. RA No. 8756 - Regional Headquarters Law (23 November 1999)
26. RA No. 8792 - Electronic Commerce Act of 2000 (June 14, 2000)
27. RA No. 9009 - An Act Amending Section 450 of Republic Act No. 7160, otherwise
known as the Local Government Code of 1991, by Increasing the
Average Annual Income Requirement for a Municipality or Cluster of
Barangays to be Converted into a Component City. (24 February 2001)
28. RA No. 9136 - Electric Power Industry Reform Act of 2001 or “EPIRA Law” (8 June
2001)
29. RA No. 9178 - Barangay Micro Business Enterprises Act of 2002 (13 November 2002)
30. RA No. 9184 - Procurement Law (10 January 2003)
31. RA No. 9275 - An Act Providing for a Comprehensive Water Quality Management and
for Other Purposes (22 March 2004)
32. RA No. 9400 - An Act Amending Republic Act No. 7227, as amended, otherwise
known as the ‘Bases Conversion and Development Act of 1992”, and
for Other Purposes (20 March 2007)
33. RA No. 9490 - Aurora Special Economic Zone Act of 2007” (29 June 2007)
34. EO 646 - Accessibility of Information on Taxpayers between the Bureau of Internal
Revenue and the Local Government Units for Tax Collection (3 August 2007)
35. RA No. 9513 - Renewable Energy Act of 2008. (16 December 2008)
36. RA No. 9514 - Revised Fire Code of the Philippines of 2008 (19 December 2008)
37. RA No. 9520 - An Act Amending the Cooperative Code of the Philippines to be known
as the “The Philippine Cooperative Code of 2008”. (17 February 2009)
38. RA No. 9640 - Amusement Tax (21 May 2009)
39. RA No. 10121 - An Act Strengthening the Philippine Disaster Risk Reduction and
Management System, Providing for the National Disaster Risk and
Management Framework and Institutionalizing the National Disaster
Risk and Reduction and Management Plan, Appropriating Funds
Therefor and for other purposes (27 July 2009)
40. RA No. 9728 - Freeport Area of Bataan (FAB) Act of 2009 (23 October 2009)
41. RA No. 10083 - Aurora Special Economic Zone Act of 2007 (22 April 2010)
42. RA No. 10173 - Data Privacy Act of 2012 (15 August 2012)
43. RA No. 10693- Microfinance NGOs Act (3 November 2015)
44. EO No. 5, Series of 2016-Ambisyon Natin 2040 (11 October 2016)
45. RA No. 10963-TRAIN Law (19 December 2017)
46. RA No. 11032-Red Tape Act of 2007 (28 May 2018)
47. RA No. 11054 - Organic Law for the Bangsamoro Autonomous Region in Muslim
Mindanao.” or “BBL” (27 July 2018)
118

FORMS AND ANNEXES
ANNEX 2
Roxas Boulevard Comer Pablo Ocampo, Sr. Street
Manila 1004
DEPARTMENT ORDER NO. 031-2018

04 May 2018
SUBJECT: GUIDELINES ON THE COMPUTATION AND CERTIFICATION OF

INCOME FOR THE CREATION, CONVERSION, MERGER OR
ABOLITION OF A LOCAL GOVERNMENT UNIT (LGU)
1.0 RATIONALE
This Department Order establishes the rules and guidelines in the attestation or certification
of income relative to the requirement of law in the creation, conversion, merger, or abolition
of local government units (LGUs). Pursuant to Sections 7, 8 and 9 of Republic Act (RA)
No. 7160, otherwise known as the Local Government Code (LGC) of 1991 , and RA No.
90091, the Department of Finance (DOF) is mandated to attest the income indicator in
the creation, conversion, merger or abolition of LGUs. Likewise, the provincial treasurer
and the city treasurer are mandated by the LGC to certify the income requirement for the
creation of municipalities and for the classification of a city into a highly urbanized city,
respectively.
2.0 LEGAL BASES

2.1 Section 7 of the LGC requires that the creation of an LGU or its conversion from
one level to another level shall be based on verifiable indicators of viability and
projected capacity to provide services, to wit: (i) income; (ii) population; and (iii)
land area. The income of such LGU must be sufficient, based on acceptable
standards, to provide for all essential government facilities and services and
special functions commensurate with the size of its population, as expected of
the local government unit concerned;
2.2 Section 8 of the LGC prescribes that the division and merger of existing LGUs
shall comply with the same requirements of Section 7 of the LGC. However,
such division shall not reduce the income, population, or land area of the local
government unit or units concerned to less than the minimum requirements
prescribed in this Code: Provided, further, that the income classification of the
original local government unit or units shall not fall below its current income
classification prior to such division.
2.3 Section 9 of the LGC further mandates that an LGU may be abolished when
its income, population, or land area has been irreversibly reduced to less than
the minimum standards prescribed for its creation under Book III of the LGC, as
certified by the national agencies mentioned in Section 17 of the LGC to Congress
or to the sanggunian concerned, as the case may be.
1 An Act Amending Section 450 of Republic Act No. 7160, otherwise known as the Local Government Code of 1991,
by Increasing the Average Annual Income Requirement for a Municipality or Cluster of Barangays to be Converted
into a Component City
119

LTOM, 2nd EDITION
2.4 The income requirement for the conversion of municipality or a cluster of barangays
into a component city and for the creation of a province shall be certified by the
DOF, pursuant to Section 450(a), as amended by RA No. 9009, and Section
461(a) of the LGC, respectively.
For the conversion into a component city, the required locally generated average
annual income for the last two (2) consecutive years shall be at least One Hundred
Million Pesos (Php100,000,000.00) based on 2000 constant prices. While the
required average annual income for the creation of a province shall be not less
than Twenty Million Pesos (Php20,000,000.00) based on 1991 constant prices.
Provided, that the creation thereof shall not reduce the income of the original
unit or units at the time of said creation to less than the minimum prescribed
requirements.
2.5 The income requirement for the creation or conversion to a municipality and
classification into highly urbanized city shall be respectively certified by the
provincial and city treasurer, pursuant to Section 442(a) and Section 452(a) of
the LGC.
For the creation of a municipality or conversion of a barangay int o a municipality,
the required average annual income for the last two (2) consecutive years shall
be at least Two Million Five Hundred Thousand Pesos (Php2,500,000.00), based
on 1991 constant prices. Provided, that the creation thereof shall not reduce the
income of the original municipality or municipalities at the time of said creation to
less than the minimum requirements prescribed herein. While the required latest
annual income for the classification into a highly urbanized city shall be at least
Fifty Million Pesos (Php50,000,000 .00) based on 1991 constant prices.
2.6 Sections 442(c), 450(c), as amended, and Section 461 ( c) of the LGC, defines the
composition of the average annual income as t he income accruing to the general
fund, exclusive of special funds, trust funds, transfers and non-recurring income.
2.7 Under Department Special Order No. 6-92 dated 21 August 1992, or the Code
of Approving and Signing Authorities, the Bureau of Local Government Finance
(BLGF) of the DOF is mandated to certify the income of LGUs.
2.8 Under Department Order 08-2011 dated 11 February 2011, the electronic
Statement of Receipts and Expenditures (eSRE) is the official report ing system
of the DOF on local fiscal and financial matters, to be maintained by the DOF-
BLGF to fully establish a reliable, accurate and timely reporting and monitoring
system in the country.
2.9 Resolution No. 2, series of 2009, entitled “Approving the Synchronized Rebasing
of Price Indices to Base Year 2006” of the National Statistical Coordination Board
(NSCB), now known as the Philippine Statistics Authority (PSA), has approved the
rebasing of the price indices to base year 2006. The PSA has declared through its
letters dated 04 November 2014 and 10 May 2016 that the old Consumer Price
Index (CPI) series will no longer be generated once the new or rebased series
becomes available.
3.0 PURPOSE
This Department Order shall be used by the BLGF and the provincial and city treasurers
in attesting and certifying the income requirement for purposes required by the LGC to
ensure uniformity in the computation thereof.
120

FORMS AND ANNEXES
4.0 BASIC DATA
The BLGF and the concerned provincial and city treasurers shall use the approved
Statement of Receipts and Expenditures (SRE) submitted by the LGUs through eSRE
system for the last two (2) consecutive years, and four (4) years prior to the issuance
of the latest income reclassification, as the basic data for computing and attesting the
income requirement.
5.0 FEATURES OF THE CERTIFICATION
The certification of the average annual income shall be comprised of the following income
requirements:
5.1 Average Annual Income of Proposed LGU;
5.2 Resulting Average Annual Income of the Original LGU or LGUs (in determining
whether the income of the original unit or units at the time of the creation or
conversion will be reduced to less than the minimum requirements prescribed in
the LGC); and
5.3 Resulting Average Annual Regular Income of the Original LGU or LGUs (as basis
of the income classification of the original LGU or LGUs at the time of said creation
or conversion).
6.0 DETERMINATION OF ANNUAL INCOME
Based on the definition of annual income cited in the LGC and RA No. 9009, it shall be
composed of income accruing to the general fund, exclusive of special funds, trust funds,
transfers and non-recurring income, and computed as follows:
6.1 Creation of Province, Creation of Municipality or Conversion of Barangay into

Municipality, and Classification of Component City into Highly Urbanized City:
Annual _ Real Property Tax (General Fund) + Tax on Business + Other

Taxes+ Regulatory Fees (Permits and Licenses) + Service/
User Charges (Service Income) + Receipts from Economic
Enterprises (Business lncome)+ Interest lncome+ Shares
from Philippine Economic Zone Authority (PEZA) + Internal
Revenue Allotment (IRA)
6.2 Conversion of Municipality/ies or Cluster of Barangays into Component City:
Locally _ Real Property Tax (General Fund) + Tax on Business + Other

Generated ~ Taxes+ Regulatory Fees (Permits and Licenses) + Service/
Annual User Charges {Service Income) + Receipts from Economic
Income Enterprises (Business Income) + Interest Income + Shares
from PEZA
7.0 COMPUTATION OF THE AVERAGE ANNUAL INCOME BY INDEXING
7.1 In the absence of the PSA-issued CPI based on the required base year, the BLGF
shall compute the CPI factor and apply to the average annual income at current
prices using the following steps of indexing approach:
7.1.1. Compute the growth rate of CPI based on available constant price
released by PSA for fiscal year (t) by dividing the difference of current
year and prior year CPI based on available constant prices to prior year
121

LTOM, 2nd EDITION
CPI based on available constant price.

Growth Rate of _ CP/ based on available constant pricet-CPI
CPI based on - based on available constant price,,
available constant ________________________________ _____
pricest CPI based on available constant pricet1
7.1.2. Estimate the CPI based on required constant price of fiscal year (t) for
the creation of province/municipality and conversion into component city
using the computed growth rate of CPI based on available constant price.
Required (1 + Growth Rate of CPI based on available

CPI = constant pricet) x
Required CPIt1
The CPI based on required constant prices is 100. Hence, computation

ofthe required CPI factor shall be as follows:
Required _ CPI based on Required Constant Price,
CPIt ~ !-----
100
7.1.3. Divide annual income at current prices by the CPI factor based on required
constant prices, depending on the LGU type to get the annual income at
constant price.
Annual income at con- = Annual income at current pricest

stant prices (AICP)t
Required CPI factort
7.1.3.1 Creation of Province: compute the annual income at constant

prices received by the province from all the subject municipalities.
7.1.3.2 Conversion into Component City: compute the locally generated

annual income at constant prices of component municipality or
cluster of barangays.
7.1.3.3 Creation of Municipality: compute the annual income at constant
prices received by all the subject barangays.
7.1.3.4 Classification of Component City as Highly Urbanized City:

compute the latest annual income at constant prices of the
subject component city.
7.1.4. Add each annual income at constant price for a given year to get the total
annual income and divide the total annual income by the number of fiscal
years to get the average annual income based on constant prices.
Average Annual income at constant prices _ A/^Pti + AI(~:Pti

(A'cp)t1,t2 = T
7.2 To determine if the creation or conversion of an LGU will not reduce the income
ofthe original unit or units at the time of said creation or conversion to less than
the minimum requirements prescribed in the LGC, compute the reduced average
annual income of the original unit or units by deducting the shares of income of
the proposed LGU to the annual income ofthe original unit or units.
122

FORMS AND ANNEXES
8.0 RESULTING INCOME CLASSIFICATION OF THE ORIGINAL LGU/LGUs
The average Annual Regular Income of the original LGU/LGUs less than its shares from
the proposed LGU at current prices, shall be the basis in determining the resulting income
classification of the original LGU/LGUs, based on existing policy of the DOF on income
classification.
9.0 RESPONSIBILITIES OF THE BLGF
The BLGF, being the policy and technical arm of DOF in supervising the revenue
operations of all local governments, shall implement this Order and shall be responsible
for the following:
9.1 Update annually the CPI Factor based on the available CPI data released by the
PSA;
9.2 Provide annually the matrix of CPI table to be used by the provincial and city
treasurers in computing and certifying the lat est annual income;
9.3 Issue the Certificate of Average Annual Income to requesting LGUs and legislators,
as prescribed in the LGC, indicating the result s of the above mentioned income
requirements;
9.4 Capacitate provincial and city treasurers on the process and methodology of
computing and certifying the latest annual income;
9.5 Issue appropriate clarificatory guidelines/updates/advisories relative to the

implementation of this Department Order subject to the direct supervision and
approval of the Undersecretary of Revenue Operations Group; and
9.6 Provide an annual report to the DOF on the certifications issued.
10.0 REPEALING CLAUSE
All department orders, circulars and issuances inconsistent with this Department Order
are hereby repealed or modified accordingly.
11.0 EFFECTIVITY
This Department Order shall be effective fifteen (15) days after completion of its publication
in a newspaper of general circulation.
123

LTOM, 2nd EDITION
ANNEX 3

Manila 1004
DEPARTMENT PERSONNEL ORDER NO. 477-2019
GUIDELINES ON THE EVALUATION AND PROCESSING OF APPOINTMENTS

OF LOCAL TREASURERS AND ASSISTANT LOCAL TREASURERS
1. LEGAL BASES. This Department Order is issued under the following legal bases:
1.1. Section 470 (a) and 471 (a) of Republic Act (RA) No. 7160, or the Local
Government Code (LGC) of 1991 mandate that the local treasurer and
assistant local treasurer shall be appointed by the Secretary of Finance from
a list of at least three (3) ranking, eligible recommendees of the governor or
mayor, as the case may be, subject to civil service law, rules and regulations;
1.2. Section 470 (c) of the LGC of 1991 provides that no person shall be appointed
local treasurer unless one is a citizen of the Philippines , a resident of the
local government unit (LGU) concerned, of good moral character, a holder
of a college degree preferably in commerce, public administration or law
from a recognized college or university, a first-grade civil service eligible
or its equivalent, and has at least five (5) years experience in treasury or
accounting service in the case of the city or provincial treasurer, and three
(3) years in the case of municipal treasurer;
1.3. Section 471 (b) of the LGC of 1991 provides that no person shall be
appointed assistant treasurer unless one is a citizen of the Philippines,
a resident of the LGU concerned, of good moral character, a holder of a
college degree preferably in commerce, public administration, or law from
a recognized college or university, a first-grade civil service eligible or
its equivalent, and has at least five (5) years experience in the treasury
or accounting service in the case of the assistant city or provincial treasurer,
and three (3) years in the case of assistant municipal treasurer;
1.4. Section 2 of Executive Order (ED) No. 292, s. 1987 and Section 65 of EO
No. 127, s. 1987 mandate the DOF to be responsible for the supervision
of the revenue operations of all LGUs, and the Secretary of Finance shall
issue such rules, regulations and other issuances to ensure the effective
implementation of the EO;
1.5. Section 43 (b) of Executive Order (EO) No. 127, s. 1987, and Section 33 (2)
of EO No. 291, s. 1987 mandate the Bureau of Local Government Finance
(BLGF) to exercise administrative and technical supervision and coordination
over the treasury and assessment operations of local governments;
124

FORMS AND ANNEXES
1.6. Civil Service Commission (CSC) Memorandum Circular (MC) No. 6, series
2012 requires the establishment and implementation of the Strategic
Performance Management System in the performance-based evaluation for
personnel action;
1.7. Department Order (DO) No. 053.2016 dated 20 Oct 2016 institutionalizes the
Standardized Examination and Assessment for local Treasury Service (SEAL)
Program, and set the Basic Competency on Local Treasury Examination
(BCLTE), the Intermediate Competency on Local Treasury Examination
(ICLTE) and the Advance Competency on Local Treasury Examination
(ACLTE) as integral criteria in selecting and evaluating recommendees for
local treasury appointments;
1.8. CSC MC No. 24, s. 20171 Resolution No. 1701009 dated 16 June 2017
(Omnibus Rules on Appointments and Other Human Resource Actions), as
amended by CSC Resolution No. 1800692 dated 03 July 2018 , provide
the rules on the preparation, submission of and actions to be taken on
appointments and other human resource movements of employees
appointed to first and second level positions;
1.9. CSC Resolution Nos. 1701330 and 1701331, both dated 20 September
2017 authorizes the regular offering of BCLTE as a civil service eligibility
exam, leading to Local Treasurer Eligibility, and the ICLTE as a promotional
exam, respectively; and
1.10. CSC MC No. 23, s. 2016, doted15 September 2016, and CSC MC No. 08, s.
2017, dated 21 March 2017 set the Policy on Employment in the Government
Service of Filipino Citizens with Dual Citizenships.
2. SCOPE AND RATIONALE. To ensure the delivery of quality service standards,

the herein procedural guidelines shall govern the evaluation and processing
of appointments of Provincial, City and Municipal Treasurers, and Assist ant
Provincial, City and Municipal Treasurers by the BLGF Central and Regional
Offices.
The BLGF, through its duly constituted Human Resource Merit Promotion and
Selection Boards (HRMPSBs) in the Central Office (CO) and In each Regional
Office (RO), shall adopt the herein criteria and guidelines in determining the best
candidate for local treasury positions to be appointed by the Secretary of Finance,
consistent with existing law, and civil service rules and regulations.
3. GENERAL POLICES. The following general policies shall be observed:
3.1. All CSC rules and regulations on appointment, promotion, transfer, and other
human resource actions, and internal policies of the DOF to determine the
competence and fitness of recommendees for local treasury appointments
shall be complied with;
3.2. The vacant position of Local Treasurer and Assistant Local Treasurer, as
the case may be, shall be published and posted in accordance with RA No.
7041 (Publication Law), as amended, for at least fifteen (15) calendar days.
125

LTOM, 2nd EDITION
The filling up of vacant position shall be made after fifteen (15) calendar
days from its publication, which, however, shall not exceed nine (9) months
from its publication.
3.3. Said notice of vacancy shall contain the qualification standards for the
position as provided under RA No . 7160 and shall be posted in at least three
(3) conspicuous places within the LGU and shall be reported to the CSC;
3.4. The recommendation of the local chief executive (LCE) for appointment
of Provincial, City and Municipal Treasurer, and Assistant Provincial, City
and Municipal Treasurer positions shall be in writing and signed by hand,
and in accordance with Sections 470(c) and 471(b) of the LGC. The
recommendation of an Acting LCE shall be in accordance with Sec. 46 of
the LGC;
3.5. The recommendation of the LCE for the appointment of the Municipal
Treasurerand the Assistant Municipal Treasurer, as well as the City Treasurer
and the Assistant City Treasurer of component cities, shall be endorsed by
the concerned Provincial Treasurer to the BLGF within five (5) working days
from receipt thereof;
3.6. No fees, of whatever nature, shall be collected for the processing of

appointment by the BLGF and the DOF. Moreover, it shall be the sole
responsibility of the concerned recommendees to secure and renew the
required clearances, certifications and other relevant documents, and shall
not in any manner be undertaken by the BLGF;
3.7. There shall be constituted and established the BLGF Central HRMPSB
for local Treasurers, which shall be chaired by the BLGF Executive Director,
and the BLGF Regional HRMPSB for Local Treasurers in every BLGF RO,
which shall be chaired by the concerned BLGF Regional Director, to evaluate
the qualifications and competence of all recommendees of the concerned
LCE. In the case of LGUs in the National Capital Region (NCR), the BLGF
Central HRMPSB shall perform the functions for the purpose;
3.8. Such HRMPSBs shall convene at least once every quarter and shall be
supported by appropriate members and staff to perform secretariat and
technical support functions, to be constituted by the respective chairs.
The concerned Provincial Treasurer or his/her duly authorized alternate
shall be designated as ex officio member of the BLGF Regional HRMPSB
for deliberations of local treasury appointments in component cities and
municipalities.
3.9. The BLGF Regional 1-TRMPSB for Local Treasurers shall evaluate and rank
the recommendees, formalized through a Regional HRMPSB Resolution,
with a duly signed summary of ratings and the required documents to be
submitted to the BLGF Central HRMPSB for Local Treasurers, which in
turn shall evaluate the same and formalize the final deliberations through a
Central HRMPSB Resolution;
126

FORMS AND ANNEXES
3.10. To further assess the candidates’ capacity for the position, interview of the
recommendees of the LCE by the BLGF Executive Director, in the case of
LGUs in the NCR, or by the BLGF Regional Director, in the case of LGUs
within the regional jurisdiction, shall be conducted before submitting the
same to the BLGF Central HRMPSB; and
3.11. All appointments signed by the Secretary of Finance and officially released
to the BLGF shall be immediately transmitted to the appointed local treasurer
or assistant local treasurer, copy furnished the concerned regional office, in
order that said local treasurer or assistant local treasurer can immediately
take his/her oath of office and assume the duties of the position.
4. CRITERIA FOR EVALUATION. In evaluating all the recommendees of the LCE,

the following qualifications and attributes shall be weighted:
4.1. Education: College degree, preferably in commerce, public administration

or law, from a recognized college or university;
4.2. Experience in treasury or accounting service1: Provincial and City

Treasurers or Assistant Provincial and City Treasurers: At least five (5)
years; Municipal Treasurers or Assistant Municipal Treasurers: At least three
(3) years;
4.3. Performance: At least ‘Very Satisfactory’ rating in the last rating period1
2
prior to the assessment or screening;
4.4. Relevant Training3: Completion of trainings, scholarships, and other

capacity building interventions relevant to the duties and functions of the
position undertaken within the last five (5) years reckoned from the date of
LCE recommendation;and
4.5. Other Related Criteria and Attributes: To further establish competency and
fitness, additional criteria and attributes shall be evaluated and weighted,
namely: (i) Salary Grade/Rank; (ii) Previous Designation in the Local
Treasury Service; (iii) Post-graduate Degree/s; (iv) Bar and/or Professional
license; (v) SEAL certification; and (vi) Interview by the BLGF.
Further, in evaluating previous designations of recommendees, only

the designations as assistant local treasurer shall be given weight for
appointments to assistant local treasurer position, while designations as
local treasurer shall be given weight for appointment to both local treasurer
and assistant local treasurer positions. The weights for SEAL certification,per
1 Experience refers to the previous jobs in either the government or private sector whether full-time or part-
time, which, as certified by the Human Resources Management Officer or authorized officials of the previous
employer, are functionally related to the duties In the PDF of the position to be filled. (Sec. S6 Part III of CSC MC
No. 24, s. 2017). Relevant experience acquired through a designation covered by an Office or Memorandum
Order may be considered for meeting the experience requirement (Sec. 60 Part III of CSC MC No. 24, s. 2017)
2 CSC Resolution 1800692, promulgated on 02 July 2018
3 Trainings/learning and development Interventions intended to enable the candidate to successfully perform the
duties and responsibilities as Indicated In the PDF or ID of the position to be filled. Sec 61 Part IV of CSC MC
No. 24, s. 2017
127

LTOM, 2nd EDITION
DO No. 053.2016, are hereby amended, as follows: 10% for BCLTE, 15%
for ICLTE, and 20% for ACLTE.
The table of criteria and the respective weight allocations is hereto attached as
Annex All mandatory requirements required under the LGC and CSC rules that
have no point allocation or determined on a pass-fail basis, such as citizenship4,
residency5, good moral character6, eligibility7 and non-nepotic relationship8,
together with the applicable clearances and certifications, shall be fully evaluated
by the BLGF.
5. EVALUATION PROCESS
5.1 . Notwithstanding any prior processing by the concerned local government

to ensure completeness of documents and evaluation of candidates, which
is hereby encouraged, there shall be established a two-level evaluation
process for all recommendees of the LCEs for appointment to local treasurer
and assistant local treasurer positions, which shall at all times require due
diligence and shall be promptly acted upon by the BLGF, as follows:
5.1.1. The First Level Process (Initial Screening) shall be done by the BLGF
Regional HRMPSB for Local Treasurers to rank all recommendees
according to Item 4 hereof and determine the completeness/
sufficiency and authenticity of documentary requirements. This shall
commence upon full compliance with the documentary requirements
of all recommendees. The result of the Regional Screening, together
with all the supporting documents, shall be indorsed to the BLGF CO.
The same process shall apply in the case of LGUs in the NCR, to be
acted upon by the Administrative Division of the BLGF CO; and
5.1.2. The Second Level Process (Final Deliberation) shall be undertaken by

the BLGF Central HRMPSB for the final screening and deliberations
of the best qualified and the most competent candidate to the position.
5.2 Any application or recommendation submitted to the DOF or the BLGF

Central and Regional Offices that are not compliant with the required
documents has thirty (30) days to complete the same, after which the
entire set of documents shall be immediately returned without action to the
concerned LGU, with appropriate notification. The same process shall apply
to LGUs within the NCR to be acted upon by the Administrative Division of
the BLGF Central Office.
5.3 All proposed candidates for appointment to Provincial, City and Municipal
Treasurer and Assistant Provincial, City and Municipal Treasurer positions
that have been evaluated and deliberated upon by the BLGF Central
HRMPSB for Local Treasurers shall be submitted to the Undersecretary for
4 Filipino citizenship per CSC Memorandum Circular No. 23, s. 2016
5 A resident of the loc.11 government unit concerned per Sec. 470 (c) and Sec. 471 (b) of the LGC
6 Of good moral character per Sec. 470 (c) and Sec. 471 (b) of the LGC
7 First-grade civil service eligibility per Sec. 470(c) and Sec. 471 (b) of the LGC, or its equivalent per CSC Resolution
No. 1701330
8 Sec. 79 of the LGC: No person shall be appointed In the career service of the local government if he is related
within the fourth civil degree of consanguinity or affinity to the appointing or recommending authority.
128

FORMS AND ANNEXES
Revenue Operations Group, who shall review and indorse the same to the
Secretary of Finance for final action.
6. RESPONSIBILITY OF THE BLGF. The BLGF Executive Director shall be

authorized to issue guidelines or circulars relative to and consistent with this Order
to ensure streamlined implementation, due diligence, and continual improvement
of service delivery standards, such as the prescribed documentary requirements
for each level of HRMPSB evaluations, checklists and templates, step-by-step
procedures, certification of completeness and orderliness of required documents,
and comparative evaluation matrices, among others. Any adjustments on
weights and allocations of Annex “’A”’ hereof shall be upon the approval of the
Undersecretary of Revenue Operations Group.
7. REPEALING CLAUSE. This Order effectively repeals Local Administrative

Regulations No. 1 -85, dated February 7,1985. All other DOF orders and issuances
or parts thereof that are inconsistent herewith are hereby repealed or modified
and amended accordingly.
8. EFFECTIVITY. This Department Order shall take effect immediately.
All BLGF officials and employees are hereby enjoined to properly, efficiently and
strictly implement the provisions of th is Order within their respective jurisdictions.
CARLOS G. DOMINGUEZ
Secretary
JUN C4 2JI3
129

LTOM, 2nd EDITION
Annex A
DETAILED CRITERIA FOR EVALUATION
The following qualifications and attributes shall be evaluated and rated numerically
by the concerned BLGF HRMPSBs for Local Treasurers:
CRITERIA POINT SCORE

1. Education from a recognized college or university
a. Commerce, Public Administration or Law Degree 15 15
b. Other College Degrees 10
2. Experience in treasury or accounting service
Provinces and Cities Municipalities
a. 15 years or more a. 10 years or more 20 20
b. 10 years to < 15years b. 5 years to < 10years 18
c. over 5 years to < 10years c. over 3 years to < 5 years 16
d. at least 5 years d. at least 3 years 14
3. Applicable DOF Examination/Certification
a. SEAL 3 Certification (ACLTE) 20
20
b. SEAL 2 Certification (ICLTE) 15
c. SEAL 1 Certification (BCLTE) 10
4. Performance Rating in the last 2 rating periods
a. Outstanding 10 10
b. Very Satisfactory 8
5. Relevant Training
Provinces and Cities Municipalities 10
a. Above 120 hours a. Above 40 hours 10
b. 120 hours minimum b. 40 hours minimum 8
6. Rank/Salary Grade (SG)
a. SG 24 and above 5
b. SG18toSG23 4 5
c. SG11toSG17 3
d. SG 10 and below 2
7. Previous Designation as Acting/OIC/ICO Local
Treasurer or Acting/OIC/ICO
Non-LT/Non-ALT Regular LT/Regular ALT
a. 3 years or more a. 2 years or more 9 9
b. 2 years to < 3 years b. 1 year to < 2 years 7
c. 1 year to < 2 years c. 6 months to < 1 year 5
d. At least 6 months to <1 year d. At least 3 months to <6 months 3
8. Other Additional Points
8.1 Bar/RA 1080 Passer/Professional License Holder* 3
8.2 Post Graduate Degree 3 8
8.3 Post Graduate Diploma and Certificate 1
8.4 Collegiate/Post Graduate Honors Awards 1
10. Interview by the BLGF Executive Director or
3 3
Regional Director
Total 100
130

FORMS AND ANNEXES
ANNEX 4
REPUBLIC OF THE PHILIPPINES
8th Floor EDPC Building, Bangko Sentralng Pilipinas Complex
Roxas Boulevard, Manila 1004* Telefax Nos. 527-2780 / 527-2790
BLGF MEMORANDUM CIRCULAR NO. 025- 2019

OCT 03 2019
TO All BLGF Central and Regional Officials and Employees;

All Provincial, City and Municipal Treasury Offices;
and Others Concerned
SUBJECT Guidelines on the Evaluation and Processing

of Appointments of Local Treasurers and Assistant
Local Treasurers
This Memorandum Circular is issued to inform all concerned of the herein

attached Department Personnel Order (DPO) No. 477.2019, dated 04 Jun
2019, issued by the Secretary of Finance, on the Guidelines on the Evaluation
and Processing of Appointments of Local Treasurers and Assistant Local
Treasurers, thereby prescribing the streamlined documentary requirements and
evaluation criteria, integrating the Standardized Examination and Assessment for
Local Treasury Service (SEAL) Program, under Department Order No. 053.2016,
dated 20 Oct 2016, and setting the two-level screening process for evaluation by
BLGF Regional Offices (ROs) and Central Office (CO).
In line with Section 71 of the said DPO and pursuant to the BLGF Quality
Policy, the following supplementary guidelines are hereby issued for compliance by
all concerned, consistent with all applicable civil service rules and regulations:
1. Publication and Posting of Vacancy. Per Item Nos. 3.2 and 3.3 of DPO
No. 477.2019, the publication and posting of the vacant position of Local
Treasurer (LT) or Assistant Local Treasurer (ALT), in accordance with RA
No. 7041, as amended, for at least fifteen (15) calendar days, shall first be
complied with. The filling up of the vacant position shall be made after fifteen
(15) calendar days from its publication, but shall not exceed nine (9) months
from the date of publication. Such notice of vacancy shall strictly contain the
qualification standards, as provided under Sections 470 and 471 of Republic
Act (RA) No. 7160 or the Local Government Code (LGC) of 1991, and shall
be posted in at least three (3) conspicuous places within the concerned LGU,
and shall be reported to the Civil Service Commission (CSC).
2. Prescribed Documentary Requirements. The basic documentary

requirements for processing the appointments of LT and ALT are provided in
Annex A, for First Level Process (Initial Screening), and Annex B, for Second
Level Process (Final Deliberation). The sample letter of recommendation of
131

LTOM, 2nd EDITION
the local chief executive (LCE) is provided under Annex C hereof. The LGU,
through its Human Resource Management Officer, shall:
a. Require each recommendee to submit all documentary requirements

listed in Item A ofAnnex 4 and ensure the completeness of information;
b. Prepare the documentary requirements in Item B of Annex A; and
c. Consolidate, label, tab and properly file in a docket or binder all

documents enumerated in Annex A, together with the letter of
recommendation of the LCE (Annex C) as cover.
3. Requisites in the Submission of Letter of Recommendation of the

LCE. The letter of recommendation with supporting documents shall be
submitted to the BLGF RO, through the Provincial Treasurer, in the case
of municipalities and component cities, and to the BLGF CO Administrative
Division, in the case of LGUs in the National Capital Region (NCR), for pre
evaluation and initial screening. If the recommendation is made by the LCE
in Acting Capacity, compliance with Sec. 46 of RA No. 7160, or the LGC,
shall be observed.
4. Constitution of the BLGF HRMPSB. The BLGF Regional HRMPSB of each

BLGF RO shall be chaired by the concerned BLGF Regional Director, and
composed of ranking Bureau personnel. The concerned Provincial Treasurer
or his/her duly authorized ranking alternate shall serve as ex officio member
thereof in screening local treasury appointments in component cities and
municipalities, per Item Nos. 3.7 and 3.8 of DPO 477.2019. The BLGF
Central HRMPSB shall be chaired by the BLGF Executive Director, and
composed of ranking Bureau personnel, per Item Nos. 3.7 and 3.8 of DPO
477.2019.
5. First Level (Initial Screening) Process. The concerned BLGF Action Officer
shall pre-evaluate the LGU’s compliance with the documentary requirements
and provide immediate feedback. In case the documents submitted are
found incomplete or deficient, the LGU shall be properly notified using the
form prescribed in Annex D hereof. The evaluation of the documents shall
be certified as to completeness and orderliness, per Annex E hereof, and
submitted to the BLGF Regional and Central HRMPSBs for deliberations.
The BLGF HRMPSB shall deliberate and rank the recommendees for LT and/
or ALT position/s. It shall comparatively evaluate all recommendees using
Annex F hereof. Interview of recommendees by the BLGF Regional Director
or Executive Director, as the case may be, shall be required to further evaluate
the candidates’ capacity for the position, and the corresponding points shall
be included in the evaluation sheet. The results of each deliberation shall
be formalized through a Board Resolution, and supported by duly signed
summary of ratings, including all the First Level documentary requirements
and the accomplished compliance certification, to be submitted to the BLGF
Central HRMPSB.
132

FORMS AND ANNEXES
6. Second Level (Final Deliberation) Process. The BLGF Central HRMPSB

shall conduct the corresponding Second Level process for the final
deliberation of all recommendees. The BLGF CO Administrative Division
shall communicate the results to the BLGF RO to inform the concerned
recommendee ofthe submission ofthe documentary requirements specified
in Annex B hereof. Upon completion of all the required documents, the BLGF
Central HRMPSB Chairperson shall endorse the proposed appointment
papers to the Secretary of Finance, through the Undersecretary of Revenue
Operations Group (ROG), for final action, together with the certification as
provided in Annex F hereof. As part of due diligence, the BLGF Office of the
Executive Director, the ROG Office of the Undersecretary, and/or the DOF
Office of the Secretary may require additional information or clarification
whenever warranted.
7. Return Without Action Policy. All recommendations or documents received

by the BLGF RO or CO that are not compliant with the requirements shall
be given up to thirty (30) days upon issuance of notification to complete
the same. If after the lapse of the said period the requirements remain
to be completed, the entire set of documents shall be immediately and
formally returned without action to the concerned LCE. In cases of individual
applications received by the BLGF, the same shall be immediately referred
to the concerned LCE for appropriate action.
8. Issuance of Appointment Papers. All appointments signed and issued

by the Secretary of Finance shall be subject for attestation by the CSC.
The same are not covered by Section 18 Rule VI of the ORAOHRA, which
requires the concurrence of the majority of all the members of the local
Sanggunian to approve such appointments, inasmuch as the appointing
authority is the Secretary of Finance.
As per Item No. 3.11 of DPO No. 477.2019, a certified true copy of the
appointment shall be issued to the appointee, through the BLGF, copy
furnished the LCE, in order that said appointee can immediately take his/
her oath of office and assume the duties of the position. In cases where
the nature of the appointment issued involves promotion or transfer from
another agency or LGU to another, the appointee shall seek an Authority
to Transfer from the head of the agency where he/she is employed prior to
assumption, which shall be submitted to the BLGF CO. Upon receipt of the
copy of appointment, the appointed LT or ALT shall submit to the CSC Field
Office, through the BLGF CO Admin Division, the following:
a. Duly acknowledged, signed and dated Appointment Paper;
b. Copy of the Oath of Office; and
c. Clearance Form (CSC Form No. 7).
9. Administrative Costs. All administrative costs related to the conduct of

screening and deliberations by the BLGF ROs and CO shall be chargeable
to the concerned BLGF office funds only. No fees, of whatever nature, shall
133

LTOM, 2nd EDITION
be collected for the processing of appointments from the LGU or individual

recommendees.
10. Effectivity. This Memorandum Circular shall take effect immediately and all
proposed appointments pending at the BLGF RO level shall be evaluated
in accordance with the herein guidelines. All BLGF Regional Directors
are enjoined to strictly comply with the herein rules, and to immediately
and widely disseminate the same to all concerned under their respective
jurisdictions.
All concerned shall be guided accordingly.

Executive Director
17163
Attachments
Annex A First Level Basic Documentary Requirements for Appointment of L Ts and ALTs
Annex B Second Level Documentary Requirements for Appointment of LTs and ALTs
Annex C Sample Letter of Recommendation of Local Chief Executive
Annex D Notification of Deficiency in Documentary Requirements
Annex E First Level Compliance Evaluation of Requirements for Appointment
Annex F Second Level Compliance Evaluation of Requirements for Appointment
Annex G Comparative Evaluation Sheet
134

FORMS AND ANNEXES
ANNEXA
First Level Basic Documentary Requirements

Document Remarks
1. Personal Data Sheet (PDS) - CSC Form No. 212, with the
3 Originals*
following:
1.3 Office Order for Designation as Treasurer/Assistant 1 Certified Copy
Treasurer each
1.4 Sworn Certificate of Employment (for private work
1 Photocopy
experience)
1.4 Latest Approved Appointment (if applicable) 1 Certified Copy
1.5 Certificate of Residency1 1 Original
2. Certificate/s of Eligibility
2.1 Civil Service Commission for CSP and/or BCLTE 1 Authenticated
Copy for each
2.2 Professional Regulation Commission (PRC) applicable eligibility
2.3 Bar
1 Certified Copy
3. Relevant Training Certificates*1
2
each
1 Certified Copy
4. Performance Evaluation for the last two (2) rating periods3
each
B. LGU Requirements
1. Recommendation Letter of Local Chief Executive, with the
1 Original*
following:
1.1 Sworn Statement of Non-Prohibited Relationship4 1 Original*
1.2 Certification of Availability of Funds5 1 Original
1.3 Approved Plantilla Schedule for the current year 1 Certified Copy
1.4 Publication of Vacancy (not beyond 3 months old)
1 Original
and Posting, with Qualification Standards6
1.7 If applicable, provide justification/certification for: 1 Original for each
a. Quantum Leap in Salary Grade applicable case
b. Dearth of Applicants/lnclusion of Applicants from Other or include in the
LGUs recommendation
c. Non-inclusion of Next-in-Rank Employees letter
1.8 Government Issued ID with Photo and Signature of LCE 1 Certified Copy
Additional Requirement for Assistant Local Treasurer:

Certificate of Compliance with Sec. 325 of Republic Act No. 71607
* Original document must be signed by hand.

1 Certificate issued by the concerned Barangay Chairman and stating the candidate’s good moral character
2 Maximum ot 120 hours for the last 5 years for PT/CT: and 40 hours for the last 5 years for mt
3 Reckoned from the date of recommendation of the LCE
4 Certificate must state that the nominee is not within the 4th degree of affinity or consanguinity of the LCE
5 Certificate issued by the concerned Local Accountant or Budget Officer stating the authorized salary rate, salary
grade and item number of the position
6 The Qualifications Standards to be published and posted must follow Section 470 and 471 of Republic Act No.
7160
7 Signed by hand by the LCE and Local Accountant stating that the filling up of the position complies with Section
325a of the LGC
135

LTOM, 2nd EDITION
ANNEX B
Second Level Basic Documentary Requirements

Document Remarks
1. Transcript of Records (except for recommendees who are 1 Authenticated

already regularly appointed Local Treasurer/Assistant Local Copy for each
Treasurer) academic degree
2. Latest Sworn Statement of Assets, Liabilities, and Net Worth
1 Original
(SALN)
3. Medical Certificate - Latest CSC Form No. 211 1 Original
4. Valid Clearances and Certificate/s of No Pending Case (if with pending case/s,
provide Case Summary/ies):
4.4 BLGF (only for recommendees who are already appointed
1 Original
LT/ALT
4.5 LGU or NGA (only for recommendees who are appointed
1 Original
government personnel)
5. Marriage Certificate (for married female only) 1 Certified Copy
6. Acceptance of Lower Salary (if applicable) 1 Original
136

FORMS AND ANNEXES
ANNEX C
Sample Letter of Recommendation of Local Chief Executive
Date

Executive Director
Bureau of Local Government Finance Manila
Thru: [NAME OF REGIONAL DIRECTOR]

Regional Director, BLGF Regional Office No.__
Dear Executive Director ALVINA:
In the exigencies of the service and in view of the vacancy of the [Provincial/City/
Municipal Treasurer/Assistant Treasurer] of this [Province/City/Municipality], I am
recommending the following personnel for the Bureau’s evaluation from which the
Secretary of Finance shall appoint, in accordance with Republic Act No. 7160 and
DOF Department Personnel Order No. 477.2019, to wit:
.. ... . o. .. Remarks/Bnef Summary

Name Position, Official Station , ~ .... x. 3
of Qualifications
1.
2.
3.
add rows if there are additional recommendees
Please find enclosed herein the following supporting documents for your perusal:
1. Personal Data Sheet and other supporting documents of the above

recommendees;
2. Sworn Statement of Non-Prohibited Relationship with the above
recommendees;
3. LGU Certification of Availability of Funds;
4. Approved Plantilia Schedule of the LGU for the current year;
4. Publication of Vacancy and Posting;
5. Certificate of SPMS Compliance from CSC;
6. Other justifications (if applicable); and
7. Government-issued ID with Photo and Signature of the undersigned.
Thank you.
Sincerely yours,
[Signature]
[NAME OF GOVERNOR/MAYOR]
[Position]
137

LTOM, 2nd EDITION
ANNEX D
NOTIFICATION OF DEFICIENCY IN DOCUMENTARY REQUIREMENTS
MAYOR/GOVERNOR
Province/City/Municipality of
Subject: Notice of Deficiency of Requirements for Local Treasury

Appointment
Dear Mayor/Governor
This has reference to the proposed appointment of Provincial/City/Municipal

Treasurer/Assistant Treasurer ofthe Province/City/Municipality of, per your
letter of recommendation dated, received by this Office on.
Please be informed that upon perusal of the documents submitted, the following
deficiencies and observations have been found:
Name of Recommendee:
Documentary Requirement from Individual Remarks/lnstruction
1.
2.
3.
Documentary Requirement from LGU Remarks/lnstruction
1.
2.
3.
In accordance with the policy of this Bureau, it is respectfully requested that the
above-listed documents be fully accomplished and completely submitted within thirty
(30) days from receipt of this notification. Otherwise, we will be constrained to return
the entire set of documents for appointment without action.
Thank you.
Very truly yours,
Name and Signature of Regional Director
138

FORMS AND ANNEXES
ANNEX E
COMPLIANCE EVALUATION OF REQUIREMENTS FOR APPOINTMENT
First Level Process: BLGF Regional Office No.
Name of LGU Name of LCE

Position Salary Grade PhP
Instructions: Please mark“C” if the requirement Is fully complied, and "NA” if not applicable. This Certification
must be submitted to the BLGF Central Office only when the 1* Level Requirementshave been fully complied,
and collated.
Document Remarks Evaluation

1 . PDS - CSC Form No. 212, with the following: 3 Originals
1.3 Previous Office Order of 1 Certified Copy
Designation as LT/ALT, if any each
1.4 Sworn Certificate of Employment
1 Photocopy
(for private work experience)
1 .4 Latest Appointment (if applicable) 1 Certified Copy

1.5 Certificate of Residency 1 Original
2. Certificate/s of Eligibility 1 Authenticated
2.1 CSC for CSP and/or BCLTE Copy for each
applicable
2.2 PRC/Bar eligibility
1 Certified Copy
3. Relevant Training Certificates
each
4. Performance Evaluation (iasttwo(2> rating 1 Certified Copy
periods) each

1. Letter Recommendation of Local Chief Executive,
1 Original
w/ the following:
1.1 Sworn Statement of Non-Prohibited
1 Original
Relationship
1.2 Certification of Availability of Funds 1 Original
1.3 Approved Plantilla Schedule (current year) 1 Certified Copy
1.4 Publication of Vacancy (not > 3 months old)
1 Original
and Posting, w/ QS
1.7 Justification/certification (if applicable):
1 Original for
a. Quantum Leap in Salary Grade each case or
b. Dearth of Applicants/lnclusion of Applicants include in the
from Other LGUs letter
c. Non-inclusion of Next-in-Rank Employees
139

LTOM, 2nd EDITION
1.8 Government-Issued ID with Photo

1 Certified Copy
and Signature of LCE
2. Certificate of Compliance with Section 325 of LGC
1 Original
(in the case of ALT)
This is to CERTIFY that the BLGF Regional HRMPSB has received and
evaluated the documents for the appointment of
in the Province/City/Municipality of, finding
said documents complete, in order, and in accordance with existing rules and
regulations.
Issued by: Noted by:
Name and Signature Name and Signature

of BLGF Action Officer/Secretary of BLGF Regional Director
Date: Date:
140

FORMS AND ANNEXES
141

LTOM, 2nd EDITION
ANNEX F
COMPLIANCE EVALUATION OF REQUIREMENTS FOR APPOINTMENT
Second Level Process: BLGF Central Office
Name of LGU Name of LCE

Position Salary Grade PhP
Instructions: Please mark c- if the requirement is fully complied, and” NA” if not applicable. This certification, together
with the subject documents, shall be submitted to the BLGF Central HRMPSB.
1 Authenticated
1 .Transcript of Records (except for recommendees who are already regularly Copy for each
appointed Local Treasurer/Assistant Local Treasurer) academic
degree
2. Latest SALN 1 Original
3. Medical Certificate (cscFormNo.211) 1 Original
4. Valid Clearances and Certificate/s of No Pending Case (if with pending easels, provide case
Summary/ies):

4.4 BLGF (only for recommendees who are already appointed LT/ALT) 1 Original
4.5 LGU GT NGA (onlyfor recommendees who are appointed government
1 Original
personnel)
1 Certified
5. Marriage Certificate (for married female only)
Copy
6.Acceptance of a Lower Salary (it applicable) 1 Original
This is to CERTIFY that the BLGF Central HRMPSB has received and evaluated the
documents for the appointment of in the
Province/City/Municipality of, found said
documents complete, in order, and in accordance with existing rule s and regulations.
Issued by: Noted by:
Name and Signature Name and Signature

of BLGF Action Officer of BLGF Central HRMPSB Secretary
Date: Date:
142

FORMS AND ANNEXES
BLGF Human Resource Merit Promotion and :

ANNEX G • BLGF COMPARATIVE MATRIX OF E>
NAME OF LGU IC POSITION TO BE
Name of Regular Incumbent Status of Regular Incumben

NAME OF RECOMME
Current Position t
CRITERIA POINT SCORE
Particulars
1. Education from a recognized college or university

a. Commerce, Public Administration or Law Degree 15 15
b. Other College Degrees 10
2. Experience in treasury or accounting service

Provinces and Cities Municipalities
a.15 years or more a. 10 years or more 20
20
b. 10 years to < 15years b. 5 years to < 10years 18
c. over 5 years to < 10years c. over 3 years to < 5 years 16
d. at least 5 years d. at least 3 years 14
3. Applicable DOF Examination/Certification

a. SEAL 3 Certification (ACLTE) 20
20
b. SEAL 2 Certification (ICLTE) 15
c. SEAL 1 Certification (BCLTE) 10
4. Performance Rating in the last 2 rating periods

a. Outstanding 10 10
b. Very Satisfactory 8
5. Relevant Training
Provinces and Cities Municipalities 10
a. Above 120 hours a. Above 40 hours 10
b. 120 hours minimum b. 40 hours minimum 8
6. Rank/Salary Grade (SG)
a. SG 24 and above 5
b. SG18toSG23 4 5
c. SG11toSG17 3
d. SG 10 and below 2
7. Previous Designation as Acting/OIC/ICO Local Treasurer or

Acting/OIC/ICO
Non-LT/Non-ALT Regular LT/Regular ALT
a. 3 years or more a. 2 years or more 9
9
b. 2 years to < 3 years b. 1 year to < 2 years 7
c. 1 year to < 2 years c. 6 months to < 1 year 5
d. At least 6 months to <1 year d. At least 3 months to <6 months 3
8. Other Additional Points
8.1 Bar/RA 1080 Passer/Professional License Holder* 3
8.2 Post Graduate Degree 3 8
8.3 Post Graduate Diploma and Certificate 1
8.4 Collegiate/Post Graduate Honors Awards 1
10. Interview by the BLGF Executive Director or Regional

3 3
Director
Total 100 -
Publication Prepared by: Recommendinc

Date Issued
Expiration Date
Regional HRMPSB Secretary Regional HRM
Date Signed:___________ Date Signed: _
143

LTOM, 2nd EDITION
Selection Board (HRMPSB) for Local Treasury

/ALUATION- LOCAL TREASURY APPOINTMENT
FILLED RECOMMENDING LCE SALARY GRADE ITEM NO.:
t/Reason of Vacancy
NDEE NO. 1 NAME OF RECOMMENDEE NO. 2 NAME OF RECOMMENDEE NO. 3
i Office Current Position & Office Current Position & Office
RO CO RO CO RO CO
Particulars Particulars
Score Score Score Score Score Score
j Approval: CO Final Evaluation: Confirmed per CO Deliberations
PSB Chair Central HRMPSB Secretary Central HRPMSB Chair

Date Signed: Date Signed:

FORMS AND ANNEXES
ANNEX 5: UPDATED CODE OF APPROVING AND SIGNING

AUTHORITIES (CASA) OF THE BUREAU OF LOCAL
GOVERNMENT FINANCE (BLGF)
Under Department Special Order No. 01-2018 dated 09 November 2018, the
following approving and signing authorities have been delegated to the Bureau of
Local Government Finance and certain functions have been clarified as follows:
Initial Action / Final

Function and Responsibility Recommendation- Action /
Indorsement Approval*
1. Department Orders, Circulars,
ED - USec SOF
and Regulations
2. Travel Authority for Foreign Travel (Official and Personal)
2.1. NCR: LT/ALT LCE-AFMSD-DED ED
2.2. Regions: LT/ALT LCE-RD -DED ED
3. Appointment and Other Personnel actions
3.1. Appointment
LCE-AFMS-DED-
3.1.1 NCR: LT/ALT SOF
ED
3.1.2 Regions: LT/ALT LCE-RD-DED-ED SOF
3.2. Oath and Assumption of Office LCE/RD/ED/SOF
3.3. Cancellation of Appointment
LCE-AFMSD-DED
3.3.1. NCR: LT/ALT SOF
- ED
LCE - RD - DED -
3.3.2 Regions: LT/ALT SOF
ED
3.4. Recommendation for Extension of Service
3.4.1. NCR: LT/ALT LCE-AFMSD-DED ED
3.4.2. Regions: LT/ALT LCE - PT - RD - DED ED
3.5. Secondment
3.5.1. NCR: LT/ALT LCE-AFMSD-DED ED
3.5.2. Regions: LT/ALT LCE - PT - RD - DED ED
3.6. Original Designation (including Authority for the Payment of RATA)
and Extension Thereof
LCE-AFMSD-DED
3.6.1. NCR: LT/ALT SOF
- ED
3.6.2. Regions: LT/ALT LCE - PT RD
3.7. Confirmation of RSPOs on Designations AFMSD-DED ED
4. Actions on Reassignment and Detail
LCE-AFMSD-DED
4.1. NCR: LT/ALT SOF
- ED
4.2. Regions: LT/ALT LCE - PT - RD - DED ED
5. Action on Letter of Resignation; and Indorsement of Optional/Compulsory Retirement
5.1. NCR: LT/ALT LCE - AFMSD - DED ED
145

LTOM, 2nd EDITION

Function and Responsibility Recommendation- Action /
5.2. Regions: LT/ALT LCE-PT-RD-DED ED
6. Applications for Leave
6.1. NCR: LT/ALT LCE-AFMSD - DED ED
6.2. Regions: LT/ALT LCE RD
7. Setting of Performance Targets for LT
LFPSD - DED ED
and ALT
8. Approval of Performance Assessment/Evaluation
8.1. NCR: LT/ALT LCE - AFMSD - DED ED
8.2. Regions: LT/ALT LCE - PT RD
9. Approval of Loan Applications and Agreements
under the Assessment Loan Revolving Fund (PD LGUOSD-DED ED
No. 1002)
10. Administrative Discipline
10.1. NCR: LT/ALT
10.1.1. Order to Comment/lssue
LSD - DED ED
Show-cause Order
10.1.2. Preliminary Investigation Report - PI Team
10.1.3. Resolution of Complaint LSD - DED ED
10.1.4. Attestation on Compromise
LSD - DED ED
Agreement
BOPIR/
10.1.5. Notice of Charge/Formal Charge LSD - DED - ED
SOF
BOPIR/
10.1.6. Order of Preventive Suspension LSD - DED - ED
SOF
10.1.7. Designation of Hearing Officer
LSD - DED ED
and Prosecutor
10.1.8. Decisions on Administrative BOPIR/
LSD - DED - ED
Cases SOF
10.1.9. Resolution on Motion for BOPIR/
LSD - DED - ED
Reconsideration SOF
10.1.10. Recommend the Granting
of Removal/Commutation LCE-AFMSD-DED
SOF
of Administrative Penalties - ED
and Disabilities
10.2. Regions: LT/ALT
10.2.1. Order to Comment/lssue Show
SI RD
cause Order
10.2.2. Preliminary Investigation Report - SI
10.2.3. Attestation in Compromise
RD - LSD - DED ED
Agreement
10.2.4. Resolution of Complaint SI RD
10.2.5. Confirmation of Resolution - ED
146

FORMS AND ANNEXES

Function and Responsibility Recommendation- Action 1
BOPIR/
10.2.6. Notice of Charge/Formal Charge LSD - DED- ED
SOF
BOPIR/
10.2.7. Order of Preventive Suspension LSD - DED- ED
SOF
10.2.8. Designation of Hearing Officer
LSD - DED ED
and Prosecutor
10.2.9. Decisions on Administrative BOPIR/
LSD - DED - ED
Cases SOF
10.2.10. Resolution on Motion BOPIR/
LSD - DED - ED
for Reconsideration SOF
10.2.11. Recommend the Granting
of Removal/Commutation
LCE-RD-DED-ED SOF
of Administrative Penalties
and Disabilities
10.3. Implement Decision, Order and Resolution
LSD - DED ED
(DOR)
11. Non-Disciplinary Cases
11.1. Appeal on Invalidated/ Disapproved
AFMSD - LSD - DED ED
Appointment
11.2. Resolution/Comment on Protest
AFMSD - LSD - DED ED
on Appointment
11.3. Petition for Recall of Appointment AFMSD - LSD - DED ED
11.4. Dropping from the Rolls
11.4.1. Return to Work Order
11.4.1.a. NCR: LT/ALT HRMO - LCE-DED ED
11.4.1 .b. Regions: LT/ALT HRMO - LCE RD
11.4.2. Written Notice for Unsatisfactory or Poor Performance, Physically
Unfit and Mental Disorder
11.4.2.a. NCR: LT/ALT HRMO - LCE DED
11.4.2.b. Regions: LT/ALT HRMO - LCE RD
11.4.3. Notice/Order of Separation thru Dropping from the Rolls
LCE-AFMSD-LSD-
11.4.3.a. NCR: LT/ALT ED
DED
11,4.3.b. Regions: LT/ALT LCE-RD-LSD-DED ED
The initial action or recommendation of the Provincial Treasurers under Items 3.4.2,
3.5.2, 3.6.2, 4.2, 5.2, and 8.2 shall be with respect only to their authority over LTs
and ALTs of component cities and municipalities within their respective jurisdictions.
The final action to be signed by the BLGF Executive Director or the concerned BLGF
Regional Director, as the case may be, shall bear the notation “By Authority of the
Secretary of Finance:”.
147

LTOM, 2nd EDITION
DSO No. 01-2018 amended the applicable provisions in the Local Treasury Operations
Manual (LTOM) issued under Department Orders (DOs) No. 013.2018 and 10-08
dated 19 December 2017 and 26 March 2008, respectively, Department Personnel
Order (DPO) No. 515.2017 dated 27 July 2017, and repeals DPO No. 335-03 dated
1 October 2003, DPO No. 321-00 dated 17 November 2000, DPO No. 305-00 dated
27 October 2000, and Department Special Order No. 6-92 dated August 21, 1992.
Legend: 'denotes sequential action /indorsement; and ‘/ 'denotes alternative action /indorsement;
Authorized AFMSD Administrative, Financial and Management Service Director of BLGF;

Signatory/ BOPIR Board of Personnel Inquiry and Review of DOF;
Office DED Deputy Executive Director (Administration or Operations) of BLGF;
ED Executive Director of BLGF;
HRMO Human Resource Management Officer of LGU;
HRMPSB Human Resource Merit Promotion and Selection Board of BLGF;
LCE Local Chief Executive;
LFPSD Local Fiscal Policy Service Director
LGUOSD LGU Operations Service Director
LSD Legal Service Director of BLGF;
PI Preliminary Investigation Team of BLGF;
PT Provincial Treasurer;
SI Special Investigator of BLGF;
SOF Secretary of Finance; and
USec Undersecretary of Revenue Operations Group of DOF.
148

FORMS AND ANNEXES
ANNEX 6
REPUBLIC OF THE PHILIPPINES
8th Floor EDPC Building, Bangko Sentralng Pilipinas Complex
Roxas Boulevard, Manila 1004* Telefax Nos. 527-2780 / 527-2790
BLGF MEMORANDUM CIRCULAR NO. 16- 2015
TO All Bureau Officials and Personnel; Regional Directors for the

Bureau of Local Government Finance; Provincial, City
and Municipal Treasurers and Others Concerned
SUBJECT LOCAL PUBLIC FINANCIAL MANAGEMENT TOOLS FOR

THE ELECTRONIC STATEMENT OF RECEIPTS AND
EXPENDITURES
DATE 19 June 2015
Pursuant to DBM-DILG-DOF.:.NEDA Joint Memorandum Circular No. 2015-1 dated

February 24, 2015, providing for the adoption of the local government units Public Financial
Management Reform Roadmap and Implementation Strategy in pursuit of attaining the
Philippine Development Plan’s goal of inclusive growth and poverty reduction and promoting
good governance and strong public financial management (PFM) at the local levels, the
Department of Finance particularly the Bureau of Local Government Finance (BLGF) shall
lead in capacitating LGUs in resource mobilization, revenue generation and related treasury
and assessment enhancement tools which include, among others, revenue and cash flow
forecasting tools.
The BLGF developed the Manual for the Local Public Financial Management Tools for the
electronic Statement of Receipts and Expenditures (eSRE). This Manual is the result of
the comprehensive studies under the auspices of the Asian Development Bank Technical
Assistance projects since 2007 (ADB TA4556, ADB TA4778, ADB TA7451) and the European
Union project “Support for Local Government Units for More Effective and Accountable Public
Financial Management” (LGU PFM 2) for the BLGF and the local treasury offices.
The Manual consists of two books, as follows:
1. A Manual on Determining Local Government Fiscal Capacity and Reconciling Local

Revenue Forecasts
The Manual describes the BLGF Revenue Forecasting Model which utilizes the eSRE
data and is incorporated in the eSRE system. The forecasting model generates annual
revenue forecasts for key LGU own-source revenue items per LGU, which serves as
the basis for the annual regular revenue targeting exercise. These targets are then
subjected to a revenue target reconciliation process, also prescribed in this Manual,
which involves the BLGF Regional Office and the LGU’s treasury office. The agreed
revenue targets will be used for the annual budgeting exercise. The Manual guides
the BLGF Central Office and LGUs on the meaning and use of the revenue forecasts
and the target reconciliation process.
149

LTOM, 2nd EDITION
In addition, the Local Treasurers are provided an objective process by which to

gauge their own forecasts and if necessary, rationally justify or defend it vis-a-vis the
forecasts generated by the model by citing qualitative factors specific to the LGU not
captured by the model. Through this process of statistical estimation and rationalized
and objective review by both the BLGF and Local Treasurers, income forecasting
and targeting is now more firmly grounded in the principles of good public financial
management.
2. Guidebook for the New Local Government recommends Activities leading to the
adoption of the LGU revenue and cash flow forecasting Tool shall be included in the
regular functions of the BLGF particularly of its Regional Offices.
The New LGFPMS, which improved on the original LGFPMS, a set of twenty
(20) indicators - levels, ratios and percentages - clustered into four main areas:
revenue indicators, expenditure indicators, debt and investment capacity indicators,
and financial management capacity indicators. The Guidebook for the New Local
Government Financial Performance Monitoring System describes in detail the
composition of each of these indicators, how they are computed using the eSRE
database, what they mean in terms of measuring performance in public financial
management, how they are currently being utilized, in part or in whole, and how they
can be prospectively utilized.
Activities leading to the adoption of the Manual for the Local Public Financial Management
Tools for the electronic Statement of Receipts and Expenditures (eSRE) shall be included in
the regular functions of the BLGF.
All concerned are hereby enjoined to support the implementation of the above mentioned
Local Public Financial Management Tools.
ATTY. SALVADOR M5DEL CASTILLO

OlC-Executive Director
150

FORMS AND ANNEXES
ANNEX 7
Manila 1004
ESTABLISHING THE LOCAL GOVERNMENT UNIT (LGU) FISCAL SUSTAINABILITY

SCORECARD (FSS) IN THE BUREAU OF LOCAL GOVERNMENT FINANCE (BLGF)
1.0 LEGAL BASES. This Department Order (DO) is issued to establish the LGU Fiscal
Sustainability Scorecard as the official LGU fiscal and financial performance evaluation
system of the DOF, through the BLGF, under the following legal bases:
1.1 Executive Order (EO) Nos. 127, 127-A and 292 mandate the Department of Finance
(DOF) to be responsible for the formulation, institutionalization and administration
of fiscal policies, in coordination with other concerned subdivisions, agencies and
instrumentalities of the government, and to supervise the revenue operations of all
LGUs;
1.2 EO No. 127 mandates the BLGF to assist in the formulation and implementation
of policies on local revenue administration and fund management, and to exercise
administrative, technical supervision and coordination over the treasury and
assessment operation of local governments;
1.3 Department of Budget and Management - Department of the Interior and Local
Government - DOF - National Economic Development Authority (DBM-DILG-DOF-
NEDA) Joint Memorandum Circular (JMC) No. 2015-1, dated 24 February 2015, sets
the LGI,J Public Financial Management (PFM) Reform Roadmap and Implementation
Strategy to attain the Philippine Development Plan’s goal of inclusive growth and
poverty reduction, to promote good governance and strong PFM at the local levels,
and to enjoin the DOF, particularly the BLGF, to lead in capacitating LGUs in resource
mobilization, revenue generation and related treasury and assessment enhancement
tools;
1.4 Sec. 12.3 and Sec. 12.4 of DILG-NEDA-DBM-DOF JMC No. 1 Series of 2016, dated
18 November 2016, requires the DOF, through the BLGF, to provide the following
performance measurements systems: (i) Local Government Financial Performance
Management System; (ii) Local Government Fiscal Sustainability .Scorecard; (iii)
Local Treasurers Performance Standards; and (iv) Creditworthiness Rating Index;
and to mainstream them ihto local PFM, and harmonize and complement them
through the LGU Integrated Financial Tool (LIFT);
1.5 DBM-DOF-DILG-JMC No. 2018-1, dated 12 July 2018, enjoins the adoption of the
modified format for the Statement of Receipts and Expenditures (SRE) of LGUs and
the updated guidelines in the preparation and submission thereof;
1.6 DOF DO No. 23-08, dated 29 July 2008, prescribes the New Income Brackets for
the Re-Classification of Provinces, Cities and Municipalities and amending for the
purpose DOF DO No. 20-05, dated 29 July 2005;
151

LTOM, 2nd EDITION
1.7 DOF DO No. 08-2011, dated 11 February 2011, specifies the adoption of the
Statement of Receipts and Expenditures (SRE) as the official reporting system
on local government fiscal and financial operations and providing the rules and
regulations therefor;
1.8 DOF DO No. 034-2014, dated 26 May 2014, provides for the amendment of Sections
3, 8 and 9 ofthe DO No. 08-2011 dated 11 February 2011 by stipulating the submission
of timely and/or accurate SRE reports;
1.9 Sec. 219 of the LGC which states that the provincial, city or municipal assessor shall
undertake a general revision of real property assessment within two (2) years after
the effect!vity of the Code and every three (3) years thereafter; and
1.10 Sections 1 and 2 of the DOF DO No. 059.2015, dated 28 May 2015, requires the
electronic submission of the Quarterly Reports on Real Property Assessments
(QRRPA) module in the electronic SRE system.
2.0 RATIONALE AND OBJECTIVES. In order to improve the revenue collection efficiency of
all LGUs, optimize their income generation mandates under the LGC, enjoin good fiscal
.governance at all levels, and promote openness and transparency in local fiscal and
financial management, the LGU Fiscal Sustainability Scorecard (FSS), hereinafter referred
to as “LGU FSS”, is hereby established to be the regular evaluation and assessment tool
for LGUs in order to: (1) regularly assess individual LGU fiscal and financial performance;
(2) provide comprehensive metrics and data analytics on local finance; (3) support
credit financing assessment; (4) Assist in local and national policy formulation; and (5)
encourage the development of appropriate rewards system.
3.0 SCOPE AND DATA SOURCE OF THE LGU FSS. The LGU FSS shall cover all provinces,
cities and municipalities, and shall be regularly developed and updated by the BLGF as
part of its regular programs to build and sustain good fiscal governance by LGUs. The
primary data source shall be the eSRE and QRRPA modules under the LGU Integrated
Financial Tools (LIFT) System being maintained by the BLGF for all LGUs. Additional
official references shall be considered in regard to benchmarks and reporting compliance
requirements, such as population data and growth rate, SMV ordinance, among others.
4.0 POLICY GUIDELINES. The following policy guidelines shall be observed:
4.1 The SRE, as the official financial management reporting prescribed by the DOF
to monitor LGUs’ financial performance, shall be used as the key data source in
computing and analyzing the LGU FSS.
4.2 The local Goyernment Financial Performance Management System (LGFPMS)

prescribed by the BLGF under Memorandum Circular (MC) No. No. 16-2015, dated
19 June 2015, shall serve as a guide in establishing a fiscal and financial performance
framework in processing the LGU FSS (See Annex A).
4.3 Quantitative parameters shall be designed to gauge the fiscal and financial
performance assessment of LGUs which shall include indicators assessing the
revenue, expenditures, debt and investment, and financial management capacity.
Qualitative parameters, on the other hand, shall be used to measure the behavioral
and other non-financial indicators, which shall include compliance with reportorial
duties and responsibilities as required by the DOF and BLGF; and
4.4 In setting the baselines and benchmarks, the LGU level, i.e. province, city and
municipality, income classification or income bracketing, and similar other clustering
mechanisms shall be considered in the performance evaluation.
152

FORMS AND ANNEXES
5.0 PARAMETERS FOR EVALUATION
5.1 The LGU FSS shall consist of two (2) indicators: (1) the Financial (Quantitative)
Indicators, which shall constitute 90 percent of the total score, and (2) the Non
Financial (Qualitative) Indicators, which shall constitute the remaining 10 percent.
5.2 There shall be three (3) key result areas (KRAs) for the Financial (Quantitative)
Indicators, namely: (i) Revenue Generation Capacity, (ii) Local Collection Growth and
(iii) Expenditure Management. For Non-Financial (Qualitative) Indicators, the focus
shall be on reportorial compliance on the (i) eSRE, (ii) SMV and (iii) QRRPA.
5.3 To measure the outputs and outcomes of local treasurers under Financial (Quantitative)
Indicators, the following sub-KRAs on local revenue generation and fund management
shall be measured:
5.3.1 Revenue Generation Capacity. The total weight of this indicator shall be
distributed to the six (6) sub-KRAs following the formula below:
a. Regular Income Level is the sum of locally sourced income (excluding

the Special Education Fund [SEF]), current year’s IRA, other shares from
national tax collections, and interest income;
b. Local Revenue Level refers to locally generated revenues, which shall

include real property tax (basic), business tax, other taxes, regulatory fees,
service/user charges, and receipts from economic enterprises;
c. Local Revenue Growth is the actual growth of locally generated revenues.

It shall be the main driver of revenue performance to ensure stable or
progressive collection growth and to be used as evidence of sustainability
for each local revenue source;
d. Dependence on Locally Sourced Income is the percent share of local

revenues (excluding Other Receipts) to the total regular income;
e. Dependence on Internal Revenue Allotment (IRA) is the percent share of

IRA to the total regular income; and
f. Dependence on Other Shares from National Tax Collection is the percent

share of receipts from other shares from national taxes to the total regular
income.
5.3.7 Local Collection Growth, The total weight of this indicator shall be distributed
to the two (2) sub-KRAs, which shall be the main drivers of ownsource revenue
performance, following the formula below:
a. Tax Revenues is the sum of collections from real property tax (excluding
SEF), other tax and tax on business; and
b. Non-Tax Revenue is the sum of collections from regulatory fees, user/

service charges and income from economic enterprise.
5.3.3 Expenditure Management. This Indicator focuses on the expenditure profile

and utilization of funds, including those covered by mandatory obligations and
governed by statutory limitations under the LGC. The total weight of this Indicator
shall be distributed to four (4) sub-KRAs following the below parameters:
a. Expenditure per Capita is the amount spent by the LGU per constituent for
153

LTOM, 2nd EDITION
various expenditure classes;
b. Use of IRA for Local Development Projects. Sec. 287 of the LGC: each
LGU shalf appropriate in its annual budget no less than twenty percent
(20%) of the annual IRA for development projects;
c. Limitation on Expenditure on Personal Services. Sec. 325a of the LGC: the

total appropriations, whether annual or supplemental, for personal services
of the LGU for one (1) fiscal year shall not exceed forty-five percent (45%)
in the case of first to third class provinces, cities, and municipalities, and
fifty-five percent (55%) in the case of fourth class or lower, of the total
annual income from regular sources realized in the next preceding fiscal
year; and
d. Limitation on Debt Service. Sec. 3248 of the LGC: the amount of

appropriations for debt servicing shall not exceed twenty percent (20%) of
the regular income of the LGU concerned.
5.4 For Non-financial (Qualitative) Indicators, the following sub-KRAs shall be measured
with regard to reportorial duties and responsibilities of local treasurers and assessors,
as required by the DOF and the BLGF, and the statutory requirement of the LGC in
regard to updating local revenue bases, as follows:
5.4.1 Submission of Timely and Accurate eSRE Reports in relation to DOF DO No.
8-2011, as amended;
5.4.2 Regular Updating of SMV and Conduct of General Revision of Property

Assessments, as required by DOF-DILG JMC Nos. 2010-01 and 2010-02; and
5.4.3 Submission of Timely and Accurate QRRPA, as prescribed under DO No.

059.2015 dated 28 May 2015.
5.5 In the case of municipalities, the Non-Financial (Qualitative) Indicator shall only
pertain to Submission of Timely and Accurate eSRE Reports in relation to DOF DO
No. 8-2011, as amended;
5.6 The rating scheme forthe above mentioned KRAs shall be based on statistical baselines
and standards according to LGU level and income bracketing or classifications;
5.7 The detailed sub-KRAs for both financial and non-financial indicators, including the
prescribed parameters, benchmarks and rating system, are provided in Annex B
hereof; and
5.8 The prescribed templates for the LGU FSS are provided in Annex C (Provinces and
Cities) and Annex D (Municipalities) hereof.
6.0 RATING. There shall be six (6) rating levels based on the consolidated weighted scores
from all performance indicators using the below point rank and final rating scheme:
154

FORMS AND ANNEXES
Score Final Rating Remarks

>= 80 but <= A: Excellent All revenue and expenditure Indicators are very strong;
100 very I high compliance to reportorial requirements and
directives of the DOF and the BLGF.
>= 70 but B: Very Good Most of the revenue and expenditure indicators are met
< 80 very satisfactorily; compliance to reportorial requirements
are high
>= 60 but C:Good Most of the revenue and expenditure indicators are above
<70 average performance, minimum level of compliance to
reportorial requirements are mostly met.
>= 50 but D: Average Revenue and expenditure indicators have not significantly
<60 changed and are generally on the average; compliance to
reportorial requirements are mostly met.
>= 40 but E: Needs Almost all of the key revenue and expenditure indicators
< 50 Improvement need to be improved and validated; minimum reportorial
requirements are not generally complied with.
<40 F: Poor All revenue and expenditure indicators are way below
the benchmarks; key reportorial requirements, mainly the
SRE, are not submitted and complied with.
7.0 COVERAGE OF RATING PERIOD. The fiscal performance evaluation for LGUs shall be
undertaken by the BLGF annually for every full fiscal year or from January 1 to December
31 of the immediately preceding year.
8.0 RESPONSIBILITIES OF THE BLGF. The BLGF, as the policy and technical arm of the
DOF in supervising the revenue operations of LGUs, shall implement this Order and be
responsible for the following:
8.1 Undertake the LGU FSS and complete the evaluation no later than every September
30 of the current year;
8.2 Issue the necessary implementing guidelines and procedures through appropriate
office orders or circulars;
8.3 Conduct periodic review of the parameters used in the LGU FSS and make the
necessary adjustments on the sub-KRAs, maximum score, weights, and corresponding
rating to ensure statistical robustness of the models, subject to the approval of the
Undersecretary for Revenue Operations Group;
8.4 Analyze the results of the LGU FSS and publish an annual report therefor;
8.5 Sign, approve, and disseminate the official LGU FSS results;
8.6 Post and publish electronically the individual LGU FSS results;
8.7 Use the individual LGU FSS as basis in evaluating furtherthe treasury and assessment
operations of the LGUs; and
8.8 Use and recommend individual LGU FSS as component of performance-based grant
system and awards of other government agencies.
9.0 REPEALING CLAUSE. All Department orders, memoranda, circulars or other issuances
or parts thereof that are inconsistent herewith are hereby deemed repealed and/or
modified accordingly.
155

LTOM, 2nd EDITION
10.0 EFFECTIVITY. This Department Order shall take effect fifteen (15) days after its
publication in the Official Gazette and the UP Office of the National Administrative
Register or in a newspaper of general circulation in the Philippines.
CARLOS G. DOMING
Secretary
DEC ZO 2018
156

FORMS AND ANNEXES
Annex A
LOCAL GOVERNMENT FINANCIAL PERFORMANCE MONITORING SYSTEM (LGFPMS

INDICATORS)
The LGFPMS of the BLGF serves provides the LGU fiscal and financial performance evaluation
framework, covering twenty (20) financial and service delivery indicators, grouped as follows:
1. Revenue Indicators (8): These are indicators that reflect revenue generation
capacity, and measure revenue stability, predictability of local revenues, and degree
of local government control over local revenues;
2. Expenditure Indicators (6): These are indicators that reflect expenditure rigidity and
define the degree of flexibility in allocating resources for different purposes;
3. Debt and Investment Capacity Indicators (5): These are indicators that define the
extent to which the LGU service debt obligations and consider the importance of
capital expenditures and capacity to attract long-term financing for investments; and
4. Financial Management Capacity Indicator (1): This indicator compares revenues

with expenditures, and describes the LGU efficiency in financial resources
management.
The specific indicators and ratios under the LGFPMS are listed as follows:
Group No. Specific Indicator

1 Revenue Level
2 Revenue Growth
3 Per Capita Locally Sourced Income (LSI) and Special Education
Fund (SEF)
Revenue 4 Per Capita Growth in LSI
Indicators 5 % LSI to Total Revenue
6 % Annual Regular Income (ARI) to Total Revenue
7 Ratio of Total Revenue Office Operations Cost to Total Revenues
Collected (TROOC)
8 Real Property Tax Accomplishment Rate (RPTAR)
9 Per Capita Total Expenditures
10 Personal Services Expenditure Ratio Coda I (PSERC)
Expenditure 11 Total Personal Services Expenditure Ratio (TPSER)
Indicators 12 Total Debt Service Expenditure Ratio (DSER)
13 Social Services Expenditure Ratio (SSER)
14 Economic Services Expenditure Ratio (ESER)
15 Debt Service Ratio (DSR)
Debt and 16 Gross Operating Surplus to Debt Service Ratio (GOSDSR)
Investment 17 Debt to Net Asset Ratio (DNAR)
Capacity 18 Capital Investment Expenditures to Total LGU Revenue Ratio
Indicators (CIETRR)
19 Net Operating Surplus to Total LGU Revenue Ratio (NOSTRR)
157

LTOM, 2nd EDITION
Group No. Specific Indicator

Financial 20 Uncommitted Cash Balance to Total Expenditure Ratio (UCBTER}
Management
Capacity
Indicator
The LGU FSS also looks into the overall fiscal performance of LGUs according to four (4) basic
typologies using the combined financial performance indicators and service delivery indicators
to describe the profile of LGU revenue and expenditure patterns, and to measure improved
constituency welfare via improved service delivery using local finance data, as follows:
Type 1: Good Revenue; Good Expenditure; Type 3: Poor Revenue; Good Expenditure; and
Type 2: Good Revenue; Poor Expenditure; Type 4: Poor Revenue; Poor Expenditure.
158

FORMS AND ANNEXES
Annex B
Detailed Financial and Non-Financial Indicators, Key Result Areas (KRAs),

Parameters, Benchmark and Scoring System for the LGU FSS
A. Financial (Quantitative) Indicators- 90%. The following KRAs and scores shall be
used:
No. KRA Score
1 Revenue Generation Capacity 60
2 Local Collection Growth 10
3 Expenditure Management 20
Total 90
1. Revenue Generation Capacity (60 points). The total weight of this KRA shall be
distributed to six (6) sub-KRAS, namely: (i) Regular Income Level, (ii) Local Revenue
Level, (iii) Local Revenue Growth, (iv) Dependence on Locally Sourced Income, (v)
Dependence on IRA, and (vi) Dependence on Other Shares from National Tax Collection.
1.1. Regular Income Level (5 points) 1.2. Local Revenue Level (10 points)
Parameter Rating Weight Parameter Rating Weight
Mean+50% Very Good 5 Mean+50% Very Good 5
Mean+25% Good 4 Mean+25% Good 4
Mean Fair 3 Mean Fair 3
Needs Needs
Mean-25% 2 Mean-25% 2
Improvement Improvement
Mean-50% Poor 1 Mean-50% Poor 1
Maximum Score 5 Maximum Score 5
1.3. Local Revenue Growth (20 points)

Parameter Rating Weight
>20% 20
>10% 15
Actual Growth >5% 10
>0% 5
<0% 0
Maximum Score 20
1.4. Dependence on Locally Sourced Income (10 points)

P >=20%; C >=50% Very Good 10
P >=15% but <20%; C >=40% but <50% Good 8
P>=10% but <15%; C >=30% but <40% Fair 6
Needs
P >=5% but <10%; C >=20% but 30% 4
Improvement
P >=0% but <5%; C >=0% but <20% Poor 2
Maximum Score 10
159

LTOM, 2nd EDITION
1.5. Dependence on IRA (10 points)

P <75%; C <50% Very Low 10
P >=75% but <80%; C >=50% but <60% Low 8
P >=80% but <85%; C >=60% but <70% Fair 6
P >=85% but <90%; C >=70% but 80% High 4
P >90%; C >80% Very High 2

Maximum Score 10
1.6. Dependence on Other Shares from National Tax Collection (5 points)

<10% Very Low 5
>=10% but <15% Low 4
>=15% but <30% Fair 3
30% High 2
Maximum Score 10
2. Local Collection Growth (10 points). The total weight of this KRA shall be distributed to
the two (2) KRAs, namely: (i) Tax Revenues, and (ii) Non-Tax Revenues.
2.1. Tax Revenues (5 points) 2.2. Non-Tax Revenues (5 points)

>20% 5 >20% 5
>10% 4 >10% 4
Actual Growth >5% 3 Actual Growth >5% 3
>0% 2 >0% 2
<0% 1 <0% 1
Maximum Score 5 Maximum Score 5
3. Expenditure Management (20 points). This KRA focuses on the expenditure profile of
LGUs and measures utilization of funds according to statutory limitations. The total weight
of this indicator shall be distributed to the four (4) sub-KRAs, namely: (i) Expenditure per
Capita, (ii) Use of IRA for Local Development Projects, (iii) Limitation on Expenditure for
Personal Services and (iv) Limitation on Debt Service.
3.1. Expenditure Per Capita (5 points) 3.2. Use of IRA for Local Development
Mean+50% Very High 5 >20% Passed 5
Mean+25% High 4 <20% Failed 0
Mean Fair 3 Maximum Score 5
Mean-25% Low 2
Mean-50% Very Low 1
Maximum Score 5
160

FORMS AND ANNEXES
Annex B
3.3. Limitation on Expenditure on 3.4. Limitation on Debt Service (5 points)

Personal Services (5 points)

<= 45% (H); >20% Passed 5
Passed 5
<=55% (L) <20% Failed 0
>= 45% (H); Maximum Score 5
Failed 0
>=55% (L)
Maximum Score 5
B. Non-Financial (Qualitative) Indicators -100/4. The following KRAs and scores shall
be used:
No. KRA Score

4 Submission of Timely and Accurate eSRE 4
Regular Updating of SMV and Conduct
5 3
of General Revision of Property Assessments
6 Submission ofTimely QRRPA 3
Total 10
1. Submission of Timely and Accurate eSRE (4 points)

Timely and No Rejection Compliant 4
Timely with Rejection; or No Rejection but not Timely Non-Compliant 2
No Report Submitted No Report 0
Maximum Score 4
2. Regular Updating of SMV and Conduct of General Revision of Property

Assessments (3 points)

SMV is Current and Effective Compliant 3
SMV is Outdated by at Least 3 Years Non-Compliant 0
Maximum Score 3
3. Submission of Timely QRRPA (3 points)

Complete according to form Compliant 3
Incomplete according to form Non-Compliant 1.5
No Report Submitted No Report 0
Maximum Score 3
C. Adjustments for Municipal FSS. In the case of municipalities, the Non-Financial (Qualitative)
Indicator shall only pertain to Submission ofTimely and Accurate eSRE Reports, in relation to
DOF DO No. 8-2011, as amended, which shall have a weight of 10 points.
161

LTOM, 2nd EDITION
Annex B
D. Summary of Indicators. Below is the summary of the two (2) indicators and six (6) KRAs:
For Provinces and Cities

. Maximum
i/n» Maximum ... . . . ... . , . .
KRAs Score Weight Weighted
Score
A. Financial 1. Revenue Generation Capacity 60
(Quantitative) 2. Local Collection Growth 10 90% 90 points
Indicators
3. Expenditure Management 20
B. Non- 4. SRE Compliance 40
Financial 5. SMV Updating 30 10% 10 points
(Qualitative)
6. QRRPA Compliance 30
Indicators
Total 100% 100 points
For Municipalities
Maximum
Maximum
KHAS ~ Weight Weighted
Score
Score
A. Financial 1. Revenue Generation Capacity 60
(Quantitative) 2. Local Collection Growth 10 90% 90 points
Indicators
3. Expenditure Management 20
B. Non
Financial
4. SRE Compliance 10 10% 10 points
(Qualitative)
Indicators
Total 100% 100 points
162

FORMS AND ANNEXES
Annex C
DEPARTMENT OF FINANCE I BUREAU OF LOCAL GOVERNMENT FINANCE
LGU Fiscal Sustainability Scorecard for Provinces and Cities1

NAME OF -PROVINCE/CITY/MUNICIPALITY INCOME CLASSIFICATION
Key Resu t , .. . Max Year 1 Year 2 Year 3

«
Area Indicator <,
score Rating Score Rating Score Rating Score
1.1 Regular income level2 5
1.2 Local revenue level3 10
1. Revenue 1.3 Local revenue growth 20
Generation 1.4 Dependence on locally
10
Capacity sourced income4
1.5 Dependence on IRA 10
(60 points)
1.6 Dependence on Other
Shares from National Tax 5
Collection
2.1 Tax Revenues
2.1.1 Real property tax
(Basic) 5
2. Local 2.1.2 Tax on Business
Collection 2.1.3 Other Taxes
Growth
2.2 Non-Tax Revenues
(10 points) 2.2.1 Regulatory Fees
2.2.2 User/Service 5
Charges
2.2.3 Econ. Enterprise
3.1 Total Expenditure Per
5
Capita5
3.2 Use of IRA for Local
3. Expenditure 5
Development Projects6
Management
3.3 Limitation on
(20 points) Expenditure 5
for Personal Services7
3.4 Limitation on Debt
5
Service8
SUB-TOTAL: QUANTITATIVE INDICATORS
90
(90%)
4. Submission of Timely and Accurate
Statement of Receipts and Expenditures, 4
per DO 8-2011, as amended
5. Regular Updating of Schedule of Market
Values and Conduct of General Revision of
Property Assessment per Sec. 219 of the 3
Local Government Code and DOF- DILG
Joint Memorandum Circular No. 2010-01
163

LTOM, 2nd EDITION
Key Result . .. Max Year 1 Year 2 Year 3

A Indicator Score
Area Rating Score Rating Score Rating Score
Quarterly Report on Real Property 3
Assessment (QRRPA)
SUB-TOTAL: QUALITATIVE INDICATORS
10
(90%)
OVERALL SCORE9 100
OVERALL RATING
DATASOURCES: LGU Treasurer’s Electronic Statement of Receipts and Expenditures (BLGF

run date of_________ , LGU Assessor’s Quarterly Reports on Real Property Assessment for the
applicable years, and approved LGU Schedule of Market Values
• Rating scheme for KRAs 1.1, 1.2, 1.4, 1.5 and 1.6 was based on performance according to income classification
in relation to average performance of LG Us within the same income
classification. Nl= Needs Improvement
'Total regular Income is the sum of locally sourced income (excluding SEF), current year's IRA+ other shares from
national tax collection. Other Income/receipts were not considered
due to reporting errors.
• Total revenues collected from real property tax (basic), business tax, other taxes, regulatory fees, user charges,
and income from economic enterprise.
• %share of local revenues (excluding Other Receipts) to total regular income
• Based on_Census, with__ % projected annual growth for FY__ .
• At least 20% of IRA should be utilized for local development projects (LGC Sec. 287)
, Not to exceed 45% of the annual regular income realized in the next preceding fiscal year for 1st - 3rd Income
class LGUs or 55% for 4th or lower Income dass LGUs (LGC Sec. 325a)
• Expenditures for debt servicing not to exceed 20% of the regular Income for the fiscal year (LGC Sec. 324a)
• Based on the weighted score for all quantitative (KRAs 1, 2 & 3) and qualitative (KRAs 4, 5 & 6) Indicators: 100%
= 90% Quantitative KRAs + 10% Qualitative KRAs
• Re-computed based on the latest FY_report per BLGF run date of.
164

FORMS AND ANNEXES
Annex C
Annex A - Detailed Report

LGU Name:
Income Class: 2010 Population
FY Covered: 2015 Population
Indicator/ltem Year 1 +/-YoY Year 2 +/- YoY Year 3 +/-YoY

1. Regular Income
Locally Sourced Income
% Share to Regular Income
Internal Revenue Allotment (Current)
Other Shares from Nat’l Tax Collection
2. Local Revenue
Tax Revenues
Real property tax (Basic)
Tax on Business
Other Taxes
Non-tax Revenues
Regulatory Fees
User/Service Charges
Income from Econ. Enterprise
3. Internal Revenue Allotment Current
4. Other Shares from Nat’l Tax Collection

Share from Economic Zone
Share from EVAT
Share from National Wealth
Share from PAGCOR/PCSO/Lotto
Share from Tobacco Excise Tax
5. Total Expenditures (with SEF)

General Public Services
per Capita
Economic Services
per Capita
Social Services
per Capita
Education
per Capita
165

LTOM, 2nd EDITION
Notes on Rating System Used in the Preliminary Scorecard:

Regular Income and Locally Sourced Income were assessed
according to Income Class, with the following scale:
Very Good= 50% higher than the average value (Dependence on locally sourced income was assessed
Good = 25% higher thin the average value
using the same scale but on per LGU type basis)
Fair= Average
Needs lmprovement= 25% lower than the average value
Total Expenditure per Capita was assessed according
Poor= 50% lower than the average value
to LGU Type
IRA Dependence was assessed according to LGU Type
Very High= 50% higher than average value
Very Low= Less than 50%
High= 25% higher than average value
Low= Greater than 50% but less then 60%
Fair= Average dependence for municipalities: 60%-70% Fair= Average
High= Greater than 70% but less than 80% Low= 25% lower than average value
Very High= Greater than 80% Very Low= 50% lower than average value
Use of IRA for Local Dev’t Projects: PASSED = Ratio is greater than or equal to 20% else, FAILED
Limitation on PS Expenditure : PASSED: <=45% for 1st - 3rd Class LGUs, <=55% for 4th to lower income class LGUs;
else FAILED
Debt Service Ratio: PASSED: Expenditures for debt servicing is less than or equal to 20% of regular Income; else, FAILED
166

FORMS AND ANNEXES
Annex C
DEPARTMENT OF FINANCE I BUREAU OF LOCAL GOVERNMENT FINANCE
LGU Fiscal Sustainability Scorecard for Provinces and Cities1

NAME OF -PROVINCE/CITY/MUNICIPALITY INCOME CLASSIFICATION
Key Result Year 1 Year 2 Year 3

Indicator Score
1.1 Regular income level2 5
1.2 Local revenue level3 10
1. Revenue 1.3 Local revenue growth 20
Generation 1.4 Dependence on locally
10
Capacity sourced income4
1.5 Dependence on IRA 10
(60 points)
1.6 Dependence on Other
Shares from National Tax 5
Collection
2.1 Tax Revenues
2.1.1 Real property tax
(Basic) 5
2. Local 2.1.2 Tax on Business
Collection 2.1.3 Other Taxes
Growth
2.2 Non-Tax Revenues
(10 points) 2.2.1 Regulatory Fees
2.2.2 User/Service 5
Charges
2.2.3 Econ. Enterprise
3.1 Total Expenditure Per
5
Capita5
3. Expenditure 3.2 Use of IRA for Local
5
Management Development Projects6
3.3 Limitation on Expenditure
(20 points) 5
for Personal Services7
3.4 Limitation on Debt
5
Service8
SUB-TOTAL: QUANTITATIVE INDICATORS
90
(90%)
167

LTOM, 2nd EDITION
Key Result . .. Max Year 1 Year 2 Year 3

A Indicator Score
Statement of Receipts and Expenditures, 10
per DO 8-2011, as amended
SUB-TOTAL: QUALITATIVE INDICATORS
10
(90%)
OVERALL SCORE9 100
OVERALL RATING
DATASOURCE: LGU Treasurer’s Electronic Statement of Receipts and Expenditures (BLGF run
date of_______ )
• Rating scheme for KRAs 1.1, 1.2, 1.4, 1.5 and 1.6 was based on performance according to income classification
in relation to average performance of LG Us within the same income
classification. Nl= Needs Improvement
'Total regular Income is the sum of locally sourced income (excluding SEF), current year's IRA+ other shares from
national tax collection. Other Income/receipts were not considered
due to reporting errors.
• Total revenues collected from real property tax (basic), business tax, other taxes, regulatory fees, user charges,
and income from economic enterprise.
• %share of local revenues (excluding Other Receipts) to total regular income
• Based on_Census, with__ % projected annual growth for FY__ .
• At least 20% of IRA should be utilized for local development projects (LGC Sec. 287)
, Not to exceed 45% ofthe annual regular income realized in the next preceding fiscal year for 1st - 3rd Income
class LGUs or 55% for 4th or lower Income dass LGUs (LGC Sec. 325a)
• Expenditures for debt servicing not to exceed 20% of the regular Income for the fiscal year (LGC Sec. 324a)
• Based on the weighted score for all quantitative (KRAs 1, 2 & 3) and qualitative (KRAs 4, 5 & 6) Indicators: 100%
= 90% Quantitative KRAs + 10% Qualitative KRAs
• Re-computed based on the latest FY_report per BLGF run date of.
168

FORMS AND ANNEXES
Annex D
Annex A - Detailed Report

LGU Name:
Income Class: 2010 Population
FY Covered: 2015 Population
Indicator/ltem Year 1 +/-YoY Year 2 +/- YoY Year 3 +/-YoY

1. Regular Income
Locally Sourced Income
Internal Revenue Allotment (Current)
Other Shares from Nat’l Tax Collection
2. Local Revenue
Tax Revenues
Real property tax (Basic)
Tax on Business
Other Taxes
Non-tax Revenues
Regulatory Fees
User/Service Charges
Income from Econ. Enterprise
3. Internal Revenue Allotment Current
4. Other Shares from Nat’l Tax Collection

Share from Economic Zone
Share from EVAT
Share from National Wealth
Share from PAGCOR/PCSO/Lotto
Share from Tobacco Excise Tax
5. Total Expenditures (with SEF)

General Public Services
per Capita
Economic Services
per Capita
Social Services
per Capita
Education
per Capita
169

LTOM, 2nd EDITION
Notes on Rating System Used in the Preliminary Scorecard:

Regular Income and Locally Sourced Income were assessed
according to Income Class, with the following scale:
Very Good= 50% higher than the average value (Dependence on locally sourced income was assessed
Good = 25% higher thin the average value
using the same scale but on per LGU type basis)
Fair= Average
Needs lmprovement= 25% lower than the average value
Total Expenditure per Capita was assessed according
Poor= 50% lower than the average value
to LGU Type
IRA Dependence was assessed according to LGU Type
Very High= 50% higher than average value
Very Low= Less than 50%
High= 25% higher than average value
Low= Greater than 50% but less then 60%
Fair= Average dependence for municipalities: 60%-70% Fair= Average
High= Greater than 70% but less than 80% Low= 25% lower than average value
Very High= Greater than 80% Very Low= 50% lower than average value
Use of IRA for Local Dev’t Projects: PASSED = Ratio is greater than or equal to 20% else, FAILED
Limitation on PS Expenditure : PASSED: <=45% for 1st - 3rd Class LGUs, <=55% for 4th to lower income class LGUs;
else FAILED
Debt Service Ratio: PASSED: Expenditures for debt servicing is less than or equal to 20% of regular Income; else, FAILED
170

FORMS AND ANNEXES
ANNEX 8
Roxas Boulevard Comer Pablo Ocampo, Sr. Street
Manila 1004
SUBJECT: PERFORMANCE STANDARDS FOR LOCAL TREASURERS

AND ASSISTANT TREASURERS
WHEREAS, the Department aims to instill a results-oriented performance culture

with a high level of professionalism and excellence among local treasurers and assistant
treasurers so that they discharge their duties and responsibilities competently and efficiently,
and the performance of their shared mandate and responsibility contribute at all times to good
local fiscal governance;
WHEREAS, consistent with the policies and guidelines of the Civil Service Commission,
a regular, output-oriented, and performance-based appraisal system for local treasurers and
assistant treasurers is necessary towards effective supervision of local treasury operations in
the local governments by the Department;
WHEREAS, the Secretary of Finance has appointing and disciplining authority over
all provincial, city and municipal treasurers and assistant treasurers, pursuant to Sec. 470 and
Sec. 471 of Republic Act No. 7160 (Local Government Code):
NOW, THEREFORE, in consideration of the foregoing premises, the Performance

Standards and Evaluation System for Local Treasurers, hereinafter referred to as
“Performance Standards”, and other relevant guidelines are hereby established for adoption
and implementation by the Bureau of Local Government Finance (BLGF):
Section 1. Purpose. The Performance Standards shall set the criteria and system
on the regular performance appraisal of local treasurers and assistant treasurers. It is the
goal of the Department to evaluate the level of competency, proficiency, professionalism and
productivity of all local treasurers so that their knowledge, skill sets, and strategies are attuned
to the strategic directions and priorities, particularly on local government fiscal and financial
management, of the Department.
Section 2. Policy Guidelines. The Performance Standards shall be an integral part

of the human resource management and development strategy of the Department to build
and sustain a results-oriented performance and professional culture among local treasurers
and assistant treasurers. As such, it shall be used as basis for purposes of appointment and
other personnel action, such as promotion, renewal of designation, and extension of service,
accountability assessment, awards and recognitions, capacity building interventions, among
others, pursuant to existing rules and regulations. Toward this end, there shall be a regular
monitoring and performance evaluation of all local treasurers and assistant treasurers, to be
based on objectively verifiable indicatorsand established guidelines, supported by appropriate
management and information systems, and to be undertaken by the BLGF in a transparent,
impartial, open, and synchronized process. Local treasurers and assistant treasurers who fail
to meet the minimum standards shall be given assistance to improve. If the performance of a
local treasurer or assistant treasurer remains unacceptable, despite the opportunity given, the
171

LTOM, 2nd EDITION
BLGF shall institute the appropriate administrative action. In no case shall these performance
standards and guidelines engender solicitation of favors or impose undue patronage on local
treasurers, assistant treasurers or any officials and employees of the Department.
Section 3. Scope. The policy to undertake a regular performance evaluation through

Performance Standards shall apply to all provincial, city, and municipal treasurers and
assistant treasurers, whether permanent or designate.
Section 4. Parameters for Evaluation. The Performance Standards shall consist

of two (2) key results areas, namely, the Operational Performance Goals (OPGs), which
constitute 70 percent of the total score, and the Competency Performance Goals (CPGs),
which constitute the remaining 30 percent.
4.1. Operational Performance Goals (OPGs) - 70%. The following OPG indicators
shall measure the outputs and outcomes of local treasurers in local revenue generation and
fund management:
No. Indicator Points Weighted Score

1 Local Collection Efficiency 35 24.5
2 Stable and reliable local revenue orowth 20 14.0
3 Optimum fund management 15 10.5
4 Institution of administrative and judicial
10 7.0
remedies
5 Reportorial compliance with DOF
10 7.0
requirements
6 Compliance with COA rules and requlations 5 3.5
7 Cost effective local revenue collection 5 3.5
Total 100 70.0
4.2. Competency Performance Goals (CPGs) - 30%. The following CPG indicators
shall measure the behavioral and other non-technical dimensions in the work of local
treasurers:
No. Indicator Points Weighted Score

1 Code of conduct and ethical standards 40 12.0
2 Capacity buildinq and professional
30 9.0
development
3 Professional recoqnitlons and achievements 15 4.5
4 Office management tools and support
10 3.0
system/s
5 Use of non-traditional collection strategies 5 1.5
Total 100 30.0
Section 5. Indicators for OPGs. To operationalize the OPG indicators, the following
specific benchmarks, formula and other parameters shall be adopted:
5.1. Local Collection Efficiency (35 points). This indicator measures the collection
of current and delinquent local revenues based on actual collections vis-a-vis the respective
targets in all local revenue areas. The total weight of this indicator shall be distributed to the
four major local revenue sources, namely: real property tax, business tax, regulatory fees and
service/user charges (hereinafter referred to as “fees and charges”), and business income
172

FORMS AND ANNEXES
from economic enterprises (hereinafter referred to as “economic enterprise”).
The weight assignment is further distributed according to the revenue taxing powers of LGUs,
and the historical performance of the four revenue sources for each level of LGU:
5.1.1. If the LGU is operating a local economic enterprise, the standard and weight
distribution to be adopted shall be:
Benchmark: 85% Collection of target in each local revenue source

Benchmark scoring by revenue source: >100% = 1; >95% but <100% = 0.75; >90% but
<95% = 0.50; >85% but <90% = 0.25; <85% = 0
Formula: Collection Efficiency = (Collection/Tarqet) x 100%
Computation: Formula to be applied per local revenue source; benchmark score to be
summed up to qet total score
Data Source: Statement of Receipts and Expenditures; Quarterly Report on Real Property
Assessments (for real property tax only)
Weight Distribution (Points)
Revenue Source Province City Municipality
Real Property Tax 14 12 11
Business and Other Taxes 6 17 10
Fees and Charges 10 3 7
Economic Enterprise 5 3 7
Total 35 35 35
5.1.2. If the LGU is not operating a local economic enterprise, the standard and weight
Benchmark: 85% Collection of target in each local revenue source

<95% = 0.50; >85% but <90% = 0.25; <85% = 0
Formula: Collection Efficiency = (Collection/Tarqet) x 100%
Computation: Formula to be applied per local revenue source and summed up to get total
score
Data Source: Statement of Receipts and Expenditures; Quarterly Report on Real Property
Assessments (for real property tax only)
Total 35 35 35
5.1.3. Target and Collection Efficiency Parameters. In determining the targets and in
computing the collection efficiency of local revenue sources, the following guidelines shall be
adopted:
5.1.3.1. Real Property Tax (RPT). For purposes of OPG 1, real property tax collection
173

LTOM, 2nd EDITION
shall pertain to receipts from basic real property tax, and Special Education Fund,
including collections from current and prior year penalties and properties acquired by
the local government for want of bidder. In determining the RPT target, the current
year collectibles and the cumulative collectible delinquencies for the last five (5) years
only, based on the Quarterly Report on Real Property Assessments, as reported by
the local assessors shall be computed. The parameters to be adopted in determining
the target, collections, and collection efficiency shall be:
Real Property Tax
Item Formula
Collection RPT Current Year Collection+ Prior Year (Basic)+ Prior Year
Penalty (Basic)+ Prior Year (SEF) + Prior Year Penalty (SEF)
Target (Total Current Collectibles x 80%) +
(Cumulative Five-Year Delinquencies x 35%)
Efficiency Collection/ Target
5.1.3.2. Business and Other Taxes, Fees and Charges, and Income from Economic
Enterprise. The targets/collectibles for business and other taxes, regulatory fees, and
service/user charges, and income from economic enterprise shall be determined by
the BLGF using an annual regional Incremental Factor, to be based on the prioryear’s
gross regional domestic product (GROP), as determined by the National Economic
and Development Authority, and prior year’s inflation rate as may be applicable to
Metro Manila or other areas outside Metro Manila. The parameters to be adopted in
determining the target, collections, and collection efficiency shall be:
Business and Other Taxes
Item Formula
Collection Tax on Business (Current Year) + Other Taxes (Current Year)
Target (Tax on Business [Current Year] +
Other taxes (Current Year) x Incremental Factor
Regulatory Fees and and Service/User Charges
Item Formula
Collection Regulatory Fees (Current Year)+ Service/User Charges (Current
Year)
Target (Regulatory Fees [Prior Year] + Service/User Charges [Prior
Yearn x Incremental Factor
Economic Enterprise
Item Formula
Collection Income from Economic Enterprise (Current Year)
Target Income from Economic Enterprise (Prior Year) x Incremental
Factor
174

FORMS AND ANNEXES
5.1.3.3. Issuance of Targets. The BLGF shall issue local revenue targets to all local
treasurers not later than May 31 every year.
5.1.3.4. Concurrence of Local Treasurers with the BLGF Targets. Upon issuance of
the local revenue targets, local treasurers may request for adjustment by reason of
force majeure, civil disturbance, natural calamity or any cause or circumstance, which
legally prevents the treasurer from enforcing collection. If no adjustment is requested
and approved by the BLGF within thirty (30) days upon issuance of the targets, the
original targets, as issued, shall be adopted as basis for computing OPG 1.
5.2. Stable and reliable level of revenue growth (20 points). This indicator measures
the efforts of local treasurers in ensuring stable and progressive growth in local revenue
collections. Growth is measured based on the nominal increase in the immediately preceding
fiscal year’s collections in all local revenue areas. Similar to OPG 1, the total weight of this
indicator shall be distributed to the four major local revenue sources, namely: real property tax,
business tax, fees and charges, and economic enterprise. The weight assignment is further
distributed according to the revenue taxing powers of LGUs, and the historical performance of
the four revenue sources for each level of LGU.
5.2.1. If the LGU is operating a local economic enterprise, the standard and weight
Benchmark: > 0% growth in each local revenue source

<10% = 0.50; >0% but <5% = 0.25; SO%= 0
Formula: Revenue Growth = [(Current Local Revenues/ Previous Year’s Local Revenues)
-11 x 100%
Computation: Formula to be applied per local revenue source and to be multiplied with
the corresponding weight; benchmark score to be summed up to get total score
Data Source: Statement of Receipts and Expenditures
Total 20 20 20
5.2.2. If the LGU is not operating a local economic enterprise, the standard to be
adopted shall be:

<10% = 0.50; >0% but <5% = 0.25; 50%= 0
Formula: Revenue Growth = [(Current Local Revenues/ Previous Year’s Local Revenues)
-11 x 100%
Computation: Formula to be applied per local revenue source and to be multiplied with
the corresponding weight; benchmark score to be summed up to get total score
175

LTOM, 2nd EDITION

Total 20 20 20
5.3. Optimum Fund Management-General Fund and Special Education Fund (15
points). This indicator measures the management of the cash flow for payment of obligations
and in optimizing fund utilization and managing expenditures to ensure that released allotments
are adequately covered by available cash and/or future collections. This indicator, accounts
for the net ending cash balance, together with the total receipts from all fund sources, less the
total expenditures for the current fiscal year. The standard to be adopted shall be:
Benchmark: > Current Year Expenditures (Net Surplus)

Benchmark scoring: Net Surplus= 1; Net Deficit= 0
Formula: Net Surplus/Net Deficit= (Cash Balance Beginning +[Total Receipts Excluding
Loans, Grants & Aids) - (Total Expenditures Excluding Debt Service & Disbursement from
Grants & Aids)
Computation: Multiply weight with the benchmark score
Indicator Score Total
Surplus 15X1 15
Deficit 15X0 0
5.4. Institution of Administrative and Judicial Remedies (10 points). This indicator
measures the treasurer’s practical use of the available civil remedies for the collection of any
delinquent local tax, fee, charge, or other revenues within the LGU jurisdiction. Under the
Local Government Code, local treasurers are mandated to institute administrative (distraint or
levy) and/or judicial actions in aid of tax collection enforcement. Five (5) points shall be given
each for the institution of remedies for the collection of delinquent real property tax and for
other local taxes.
5.4.1. For the collection of delinquencies in real property tax, the standard to be
adopted shall be:
Benchmark: Issuance of warrant of levy OR Endorsement to the LGU legal officer of the
institution of civil action
Benchmark scoring:
Warrant/s of levy issued = 1 Endorsement to legal officer = 1
No warrant of levy issued = 0 No endorsement to leqal officer = 0
Formula: Score= Benchmark score x 5 points
Computation: Rating is not dependent on volume of warrants issued or endorsement/s
made to the LGU leqal officer.
Data Source: Certified copy of warrant/s of levy sent to taxpayer; OR Certified copy of
endorsement of treasurer to the LGU legal officer
176

FORMS AND ANNEXES
5.4.2. In case the local treasurer has collected already at least 90% ofthe total current
year collectibles, the full 5 points shall be credited with or without availing of administrative or
judicial remedies for RPT collection.
5.4.3. For the collection of delinquencies in other local taxes, the standard to be
adopted shall be:
Benchmark: Issuance of warrant of distraint AND Endorsement to the LGU legal officer
ofthe institution of civil action
Benchmark scoring:
Warrant/s of distraint issued = 0.5 Endorsement to legal officer = 0.5
No warrant of distraint issued = 0 q No endorsement to legal officer= 0
Formula: Score = Benchmark score x 5 points

Computation: Sum up rating per action; Rating is not dependent on volume of warrants
issued or endorsement/s made to the LGU legal officer.
Data Source: Certified copy of warrant/s of distraint sent to taxpayer AND Certified copy
of endorsement of treasurer to the LGU legal officer
5.5. Reportorial compliance with DOF requirements (10 points). This indicator
measures compliance with reportorial duties and responsibilities, as required by the
Department, namely, the SRE (DOF DOs 08-2011 and 034- 2014), the Certified List of Real
Property Tax (RPT) Delinquencies (DOF DO 10-08), the Statement of Indebtedness (DOF
LFC 1-2012), and the LGU-BIR Information Sharing (EO 646 and DOF DO 9-08). It shall be
the shared duty of the local treasurer and assistant treasurer to ensure compliance with such
reportorial accountabilities. The standard to be adopted shall be:

Benchmark scoring:
Report Weight (Points) Benchmark
1. SRE 5
2. Certified List of RPT Delinquencies 3 Complete= 1
3. Statement of Indebtedness 1 Incomplete = 0
4. LGU-BIR Information Sharinq 1
Formula: Score = Benchmark score x Weight per Report
Remarks: Correspondents weighted scores to be summed up.
Data Source/s: BLGF Central and/or Regional Offices
5.6. Compliance with COA Rules and Regulations (5 points). This indicator
accounts for the involvement in any irregular or illegal activities of the local treasurer or
assistant treasurer that could adversely affect the financial operations of LGUs and that may
lead to the filing of administrative and criminal complaint/s. This shall be based on any adverse
findings of the Commission on Audit (COA) for which the local treasurer or assistant treasurer
is primarily responsible. The standard to be adopted shall be:
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LTOM, 2nd EDITION
Benchmark: No adverse findinq/s from COA

Benchmark scoring: No adverse findings = 1; With adverse findings = 0
Formula: Score = Benchmark score x Weight
Computation: To be based on the Annual Audit Report (AAR) of COA. Such basis shall
be the AAR immediately preceding the rating period/year or the latest available AAR of the
LGU.
Data Source: BLGF copy of the COA AAR
5.7. Cost Effective Local Revenue Collection (5 points). This indicator measures
the ratio of total cost of collection and the actual local revenues collected to determine the
cost effectiveness of the local treasurer and assistant treasurer in local revenue collection.
The ratio determines whether the LGU is subsidizing the cost of collecting the tax, or the tax
is contributing to the revenue coffers of the LGU. The standard to be adopted shall be:

Benchmark scoring:
Ratio Score Weight Total Score
<10% 1 5
10% but < 15% 0.75 3.75
5
15% but < 20% 0.5 2.5
>20 0 0
Formula: Cost to Collect Ratio = (Total Expenditures of Treasurer’s Office/Total Local
Revenues) x 100
Total Actual Expenditures = Personal Services (PS) of the Treasurer’s Office+ Maintenance
and Other Operating Expenses (MOOE) of the Treasurer’s Office
Total Local Revenues = Tax Revenues+ (Non-Tax Revenues - Other Receipts)

Computation: Multiply weight with the benchmark score according to the corresponding
cost to collect ratio.
5.7.1. Adjustment in Expenditures Data. The local treasurer or assistant treasurer

concerned may request for adjustment in the expenditures data used in the evaluation.
Subject to validation and approval by the BLGF, MOOE expenditures may be adjusted to
exclude any or all of (i) Interest Expenses; (ii) Subsidies to NGAs, LGUs, or GOCCs; (iii)
Insurance Expenses; (iv) Fidelity Bond Premiums; (v) Election-related expenditures; and (vi)
Other expenditures appropriated in the Treasurer’s Office, but were actually used for other
LGU office/s.
Section 6. Indicators for CPGs. To operationalize the indicators for CPGs,

the following specific benchmarks, formula and other parameters shall be adopted:
6.1. Code of conduct and ethical standards (40 points). This indicator determines
the compliance of local treasurers and assistant treasurers with the code of conduct and
ethical standards of public officials and employees pursuant to Republic Act No. 6713. Full
points shall be given if no disciplinary actions/penalties, namely, (i) reprimand, (ii) fine, or (iii)
suspension (final and executory), have been meted by judicial and quasi-judicial bodies for
offenses or violations of existing laws, rules and regulations. The standard to be used shall be:
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Benchmark: No adverse findinq/s from COA

Benchmark scoring:
10 points 10 points 20 points
No Reprimand = 1 No Fine = 1 No Suspension = 1
Reprimanded = 0 Fined = 0 Suspended = 0
Remarks: Data to be based on the immediately preceding year’s records.
Computation: Multiply weight (by sanction) with the benchmark score.
Data Source: BLGF Central/Regional Offices
6.2. Capacity building and professional development (30 points). This indicator
measures the capacity building and development activities availed of or engaged in by local
treasurers and assistant treasurers to improve their technical proficiency, competence, and
skills from duly recognized and bona fide organizations. Such trainings shall be categorized into
(i) Core Trainings, orthose trainings, seminars, and workshops that are directly related to fiscal
and financial management, and (ii) Non-Core Trainings or those conferences, conventions,
workshops, and similar activities that enhance leadership, personality, management, and
other skills required to improve competency. The standard to be used shall be:
Benchmark: Core Trainings > 32 hours; Non- Core Trainings > 16 hours
Benchmark scoring:
Core Trainings - 20 points Non-Core Trainings -10 Points
No. of Hours Weiqht Score No. of Hours Weiqht Score
>80 1 20 >40 1 10
> 64 but< 80 0.8 16 > 32 but< 40 0.8 8
> 48 but< 64 0.6 12 > 24 but< 32 0.6 6
> 32 but< 48 0.5 10 > 16 but< 24 0.5 5
< 32 0 0 <16 0 0
Remarks: Data to be based on the immediately preceding year’s certified copy of training
certificates to be presented by local treasurers/assistant treasurers.
Computation: Multiply weight (according to the number total training hours by area) with
the benchmark score.
Data Source: BLGF Central/Regional Offices
6.3. Professional recognitions and achievements (15 points). This indicator

accounts for the annual recognitions, citations and other similar awards conferred to local
treasurers and assistant treasurers in at least two (2) areas, namely, (i) LGU awards/
recognitions with direct contribution of the treasurer/assistant treasurers, (ii) those conferred
by government and legitimate private organizations relating to local treasury performance, (iii)
resource speakership or expert engagement outside the local treasury department; (iv) civic
commendations, achievements and other honorific conferment; or (v) individual contribution
to research, published works, engagement in special project of high significance or similar
endeavors involving expertise in local treasury operations. The standard to be used shall be:
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LTOM, 2nd EDITION
Benchmark: Award/recognition in at least one (1) area

Benchmark scoring:
Indicator Weight Score
Awards in two (2) award areas 1 15
Award in one (1) award area 0.5 7.5
No award in any area 0 0
Remarks: Evaluation to be based on the immediately preceding year’s certified copy of
awards/recognitions/citations submitted to BLGF; Number of awards per area not a factor
to get higher score.
Remarks: Multiply applicable weight (bv indicator) with the benchmark score.
6.4. Office management tools and support system/s (10 points). This indicator
mea sures the adoption of quality management tools and other innovative support system/s
that improve workplace organization, foster efficient records management, improve service
delivery to clientele, enable better customer service experience to taxpayers, maintain
orderliness in office affairs and transactions, among others. Such tools and support systems
may include the (i) 5S office organization method, (ii) manual or computerized records
management system, (iii) integrated information systems, (iv) quality management certification
systems, etc. The standard to be used shall be:
Benchmark: One (1) working management tool or support system, such as, but not limit
ed to, those enumerated above.
Benchmark scoring:
Two (2) or more working systems 1 10
One ( 1 ) working system 0.75 7.5
No working support system 0 0
Remarks: Evaluation to be based on actual supervisory/ocular visit by the BLGF, in the case
of city and provincial treasurers’ offices (including the lone municipality in Metro Manila),
and by certification of the Provincial Treasurer, in the case of municipal treasurers’ offices.
Remarks: Multiply applicable weight (bv indicator) with the benchmark score.
6.5. Use of non-traditional collection strategies (5 points). This indicator gives

credit to innovative and non-traditional collection enforcement strategies of local treasurers
and assistant treasurers. Such strategies may include, but not limited to, (i) tax clearance
as requirement for renewal of business permits, (ii) one-stop-shop systems, (iii) local tax
caravans, (iv) use of social and tri-media for tax information campaign, (v) use of electronic
banking to facilitate payment, (vi) awards/tokens for top and prompt taxpayers, (vii) integration
of local tax concepts in the education curriculum, (viii) linkage with other local projects, etc.
These strategies must be legal and included in the plans and programs of the local treasurer.
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FORMS AND ANNEXES
Benchmark: One (1) non-traditional collection enforcement strategy, such as, but not
limited to those enumerated above.
Benchmark scoring:
Three (3) or more working strategies 1 5
Two (2) more working strategies 0.75 3.75
One (1) more working strategy 0.5 2.5
No innovative collection strategie? 0 0
Remarks: Evaluation to be based on (i) submitted proof/documentation or any evidence
of implementation of such strategies by the local treasurer/assistant treasurer, (ii) through
actual supervisory/ocular visit by the BLGF, in the case of city and provincial treasurers’
offices (including the municipality in Metro Manila), and (iii) by certification ofthe Provincial
Treasurer, in the case of municipal treasurers’ offices.
Remarks: Multiply applicable weight (per indicator) with the benchmark score.
Section 7. Rating Scheme and Form. There shall be five rating levels based on the
consolidated scores from all performance indicators using the below point rank and adjectival
rating scheme. The results of the Performance Standards shall be issued in the form as
prescribed in Annex A.
Score Adjectival Rating Summary of Performance

> 95 to 100 Level 5 - Outstanding Demonstrates exceptional
performance in all
operational and competency
standards.
> 85 but < 95 Level 4 - Very Satisfactory Exceeds the minimum
standards.
> 75 but < 85 Level 3 - Satisfactory Complies with the minimum
standards.
> 65 but < 75 Level 2 - Unsatisfactory Fails to meet the minimum
operational or competency
standards
< 65 Level 1 - Poor Fails to deliver most or
all of the operational or
competency standards.
Section 8. Coverage of Rating Period. Performance evaluation for local treasurers

and assistant treasurers shall be undertaken annually, and the performance period shall cover
one full fiscal year or from January 1 to December 31. In the event that a local treasurer or
assistant treasurer has not completed one full fiscal year of service, the rating shall be based
on at least six (6) months of service and the parameters for evaluation shall be adjusted
accordingly by the BLGF. No evaluation shall be made for services rendered for less than six
(6) months.
Section 9. Performance Evaluation Cycle. The following stages shall be observed

in the course ofthe performance evaluation by the BLGF and all other concerned parties:
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LTOM, 2nd EDITION
Stage 1: Local Revenue Target Setting. With reference to Section 5, Item 1.3, this
stage shall be undertaken from April to May of the fiscal year prior to the start of
the performance period where targets for all local revenues are determined, issued
and validated with the local treasurers. Upon concurrence and acceptance by the
concerned local treasurer and assistant treasurer, such targets shall be deemed final.
Stage 2: Collection Enforcement and Compliance Monitoring. In this stage, the

BLGF shall regularly monitor the plans and programs of local treasurers and assistant
treasurers and provide the necessary technical assistance in support of local treasury
administration and other LGU-set performance goals, as well as the treasurer’s
compliance concerning reportorial obligations, primarily the SRE, actions on the COA
adverse findings (if any), progress on the institution of collection remedies, continuing
capacity building programs, among others.
Stage 3: Data Validation and Rating. The actual performance evaluation shall begin
in June of the subsequent fiscal year that is subject of the performance evaluation
and shall conclude in October of the same year. As such, the BLGF Central Office
shall first release the preliminary data/results of applicable OPG indicators to all
BLGF Regional Offices no later than the end of June every year. Subsequently, the
BLGF shall notify all local treasurers and assistant treasurers to submit the pertinent
documents required in the OPG and CPG indicators that cannot be generated by the
eSRE system. Within two (2) months after the release of SRE data, the validation
and confirmation of the results of the evaluation shall be completed for approval by
the BLGF. The BLGF may delegate only to the Provincial Treasurers the gathering
and consolidation of documents required from municipal treasurers, but it shall be the
sole duty of the BLGF to rate, determine, and discuss the results of the performance
of all treasurers and assistant treasurers. The Checklist of requirements is attached
as Annex B.
Stage 4: Performance Results Awarding and Intervention Planning. The final

results of the annual performance evaluation shall be released and issued to all
local treasurers and assistant treasurers, as well as to their respective local chief
executives and other concerned parties, every October. The BLGF may award local
treasurers and assistant treasurers in recognition of exceptional performance in their
work. No other performance awards shall be given instituted unless they are linked
with the Performance Standards. In addition, the BLGF shall ensure that appropriate
measures and actions are enforced based on the results of the performance
evaluation, including but not limited to personnel action and intervention development
and planning to address weaknesses and gaps of local treasurers and assistant
treasurers.
Section 10. Performance Evaluation Group. The BLGF shall constitute the
Personnel Evaluation Group (PEG) for Local Treasurers and Assistant Treasurers, under the
Administrative, Financial and Management Service, with counterpart structure in all BLGF
Regional Offices. The PEG shall take charge of all performance planning, programming, and
implementation activities, and action on appeals, to ensure a synchronized and objective
evaluation of all local treasurers and assistant treasurers. Further, the PEG, which shall
be headed by the Executive Director, shall review and recommend for the approval of the
Secretary of Finance all performance evaluation results of local treasurers and assistant
treasurers.
Section 11. Accuracy and Integrity of Evaluation Tools and Data Sources. The
BLGF shall ensure that the data sources, systems and tools, as identified in all the OPG and
CPG indicators, to be used in the performance evaluation of local treasurers and assistant
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FORMS AND ANNEXES
treasurers are verified, true and accurate. The necessary management information systems,
tools and procedures shall be adopted to ensure timely, accurate and reliable monitoring and
reporting to support the efficient conduct of performance evaluation. The use of falsified data
and evidence of performance shall be subject to the appropriate administrative sanctions.
Section 12. Appeals. Considering that the outcome of the annual performance
evaluation may affect tenure, and other personnel actions, such as promotion and performance
recognition, local treasurers and assistant treasurers have the right to appeal within ten (10)
days upon receipt of the evaluation by the BLGF.
Section 13. Personnel Action and Capacity Building Interventions. The BLGF
shall introduce appropriate capacity building programs and other remedial interventions
based on the results of the performance evaluation, especially for treasurers and assistant
treasurers who receive “Unsatisfactory” and “Poor” performance ratings. In the event that
a local treasurer or assistant treasurer receives “Poor” rating in two consecutive evaluation
periods, the BLGF shall institute the appropriate administrative sanction pursuant to the
Revised Rules on Administrative Cases in the Civil Service.
Section 14. Penalty Clause. Failure to comply with the provisions of this Order
shall be a ground for an administrative sanction for violation of reasonable office rules and
regulations, and neglect of duty for non-compliance with this Order.
Section 15. Repealing Clause. All orders, memoranda, circulars or other issuances
or parts thereof that are inconsistent with this Department Order are hereby deemed repealed
and/or modified accordingly.
Section 16. Separability Clause. If any part of this Department Order is declared by
the courts as unconstitutional or contrary to existing laws, the other parts shall remain in full
force and effect.
Section 17. Effectivity. This Department Order shall take effect immediately upon its
publication in a newspaper of nationwide circulation.
CESAR V. PURISIMA
Secretary of Finance
024838
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LTOM, 2nd EDITION
-ANNEX A-
Bureau of Local Government Finance
PERFORMANCE STANDARDS EVALUATION

OF LOCAL TREASURERS AND ASSISTANT TREASURERS
For the Fiscal Year
Name: Station:
Position:__________________________________
Part 1: Operational Performance Goals (OPGs)

Indicator Max Score Score Earned
1. Local Collection Efficiency 24.5
2. Stable and reliable local revenue growth 14.0
3. Optimum cash management 10.5
4. Institution of administrative and judicial remedies 7.0
5. Reportorial compliance with DOF requirements 7.0
6. Compliance with COA rules and regulations 3.5
7. Cost effective local revenue collection 3.5
OPG Total Score 70
Part II: Competency Performance Goals (CPGs)

Indicator Max Score Score Earned
1. Code of conduct and ethical standards 12.0
2. Capacity building and professional development 9.0
3. Professional recognition and achievements 4.5
4. Office management tools and support system/s 3.0
5. Use of non-traditional collection strategies 1.5
CPG Total Score 30
Legend
Score Adjectival Rating Total Score
>95 to 100 Level 5 - Outstanding (l + ll)
> 85 to < 95 Level 4 - Very Satisfactory

> 75 to < 85 Level 3 - Satisfactory
Adjectival
> 65 to < 75 Level 2 - Unsatisfactory
Rating
<65 Level 1 - Poor
Recommending Approval: Conforme:
Name of Signature of RD/ED Name of Signature of Ratee

Approved by:
Secretary of Finance
Issued this__ day of 20_
184

8th FLOOR EDPC BLDG., BSP COMPLEX, ROXAS BOULEVARD
1004 MANILA, PHILIPPINES

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ONLINE EDITION - COMPLIMENTARY COPY

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Second Printing, 2020.

Printed in the Philippines

Published by the Bureau of Local Government Finance

Copyright© Bureau of Local Government Finance, 2019

All rights reserved.

Cover design and layout by: Jane Dianne S. Gaylican

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I believe this resource complements our strategy to professionalize the ranks of

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Congratulations to the Bureau of Local Government Finance (BLGF) for the

We, at the Department of Finance (DOF), recognize the achievements and

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The Bureau of Local Government Finance (BLGF) remains committed to

As local fiscal landscapes continuously evolve in pursuit of meaningful

NINO RAYMOND B. ALVINA

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DEPARTMENT ORDER NO.

Local Treasury Operations Manual (LTOM), 2nd Edition

Book III Fund Management Practices, Expenditures and Disbursement; and

Book IV Detailed Procedures on the Administration and Collection of Real Property

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LOCAL TREASURY OPERATIONS MANUAL

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2. Relationship of the LTOM to Existing Laws, Issuances and Pronouncements

Consequently, this Manual provides discussions, illustrations, forms and

C. OBJECTIVES OF THIS MANUAL

1. To provide Local Treasurers with an updated reference material that will

2. To equip Local Treasurers with necessary information to develop their own

3. To enable Local Treasurers to fully appreciate their powers, functions, and

4. To raise awareness of Local Treasurers on the basic concepts and tools of

5. To serve as a guide to Local Treasurers and other fiscal officers in the

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D. BRIEF DESCRIPTION OF THIS MANUAL

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FORMS AND ANNEXES 80

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MMDA Metro Manila Development Authority

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LTOM Book I consists of five (5) Chapters, including Annexes, as follows:

Chapter 1 Fiscal Organization of Local Government Units (LGUs)

Chapter 2 The Local Treasurer and the Assistant Local Treasurer

Chapter 3 Administrative and Technical Supervision by the BLGF

Chapter 4 Roles, Duties and Responsibilities of the Local Treasurer

Chapter 5 Bonding of Local Treasurers and Other LGU Accountable Officers

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SECTION 1. LEGAL FRAMEWORK

D. Local governments shall be entitled to an equitable share in the proceeds of the

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F. Every LGU, as a corporation, shall have the following powers:

1. To have continuous succession in its corporate name;

2. To sue and be sued;

3. To have and use a corporate seal;

4. To acquire and convey real or personal property;

5. To enter into contracts; and

6. To exercise such other powers as are granted to corporations, subject to the