Local Government Code of 1991

SECTION 310. Separation of Books and Depository Accounts. - Local accountants and treasurers shall maintain separate books and depository accounts, respectively, for each fund in their custody or administration under such rules and regulations as the Commission on Audit may prescribe. SECTION 311. Depository Accounts. - Local treasurers shall maintain depository accounts in the name of their respective local government units with banks, preferably government-owned, located in or nearest to their respective areas of jurisdiction. Earnings of each depository account shall accrue exclusively thereto. SECTION 312. Separation of Personal Money from Public Funds. - Local treasurers and other accountable officers shall keep personal monies separate and distinct from local public funds in their custody and shall not make profit out of public money or otherwise apply the same to any use not authorized by law or ordinance. Article Two. Special Accounts SECTION 313. Special Accounts to be Maintained in the General Fund. - Local government units shall maintain special accounts in the general fund for the following: (a) Public utilities and other economic enterprises; (b) Loans, interests, bond issues, and other contributions for specific purposes; and (c) Development projects funded from the share of the local government unit concerned in the internal revenue allotment and such other special accounts which may be created by law or ordinance. Receipts, transfers, and expenditures involving the foregoing special accounts shall be properly taken up thereunder. Profits or income derived from the operation of public utilities and other economic enterprises, after deduction for the cost of improvement, repair and other related expenses of the public utility or economic enterprise concerned, shall first be applied for the return of the advances or loans made therefor. Any excess shall form part of the general fund of the local government unit concerned. CHAPTER 3. - Budgeting Article One. - Local Government Budgets SECTION 314. Form and Content. - (a) Local government budgets shall primarily consists of two (2) parts: (1) The estimates of income; and (2) The total appropriations covering the current operating expenditures and capital outlays. (b) The budget document shall contain: (1) A budget message of the local chief executive setting forth in brief the significance of the executive budget, particularly in relation to the approved local development plan; (2) A brief summary of the functions, projects, and activities to be accomplished in pursuit of the goals and objectives of the local government unit for the ensuing fiscal year, specifically the delivery of basic services or facilities enumerated under Section 17 of this Code; (3) Summary of financial statements setting forth: (i) The actual income and expenditures during the immediately preceding year; (ii) The actual income and expenditures of the first two (2) quarters and the estimates of income and expenditures for the last two (2) quarters of the current fiscal year; (iii) The estimates of income for the ensuing fiscal year from ordinances and laws existing at the time the proposed budget is transmitted, together with other revenue-raising proposals; (iv) The estimated expenditures necessary to carry out the functions, projects, and activities of the local government unit for the ensuing fiscal year; (v) All essential facts regarding the bonded and other long-term obligations and indebtedness of the local government unit, if any; (vi) Summary statement of all statutory and contractual obligations due; and (vii) Such other financial statements and data as are deemed necessary or desirable in order to disclose in all practicable detail the financial condition of the local government unit. SECTION 315. Submission of Detailed Statements of Income and Expenditures. - (a) On or before the fifteenth (15th) day of July of each year, local treasurers shall submit to their respective local chief executives 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 of the current year. SECTION 316. Local Finance Committee. - There is hereby created in every province, city or municipality a local finance committee to be composed of the local planning and development officer, the local budget officer, and the local treasurer. It 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 local chief executive 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 local chief executive concerned the proper allocation of expenditures for each development activity between current operating expenditures and capital outlays; (e) Recommend to the local chief executive 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 local government unit to determine compliance with statutory and administrative requirements; and (h) Conduct semi-annual review and general examination of cost and accomplishments against performance standards applied in undertaking development projects. A copy of this report shall be furnished the local chief executive and the sanggunian concerned, and shall be posted in conspicuous and publicly accessible places in the provinces, cities, municipalities and barangays. SECTION 317. Submission of Budget Proposals by Heads of Departments or Offices. - (a) Each head of department or office shall submit a budget proposal for his department or office to the local chief executive on or before the fifteenth (15th) of July of each year: Provided, That the budget proposal of each department of office shall be categorized under either economic, social or general services: Provided, further, That each service shall be covered by the budget of at least one (1) department or office of the local government unit concerned. The said budget proposal shall be prepared in accordance with such policy and program guidelines as the local chief executive concerned may issue in conformity with the local development plan, the budgetary ceilings prescribed by the local finance committee, and the general requirements prescribed in this Title.