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DBM Cicular Letter 2013-16

This document outlines guidelines for implementing the Expanded Modified Direct Payment Scheme (ExMDPs) for paying accounts payable to creditors of government agencies starting in 2014. It describes transferring funds directly to creditors' bank accounts to ensure timely payments and reduce outstanding checks. Agencies must use the Advice to Debit Account form to authorize payments and provide creditors' bank details. Creditors without bank accounts will be paid via bank transfers. Only valid accounts payable supported by delivery of goods/services will be paid. The guidelines assign responsibilities to agencies to manage creditor data and payments.

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911 views16 pages

DBM Cicular Letter 2013-16

This document outlines guidelines for implementing the Expanded Modified Direct Payment Scheme (ExMDPs) for paying accounts payable to creditors of government agencies starting in 2014. It describes transferring funds directly to creditors' bank accounts to ensure timely payments and reduce outstanding checks. Agencies must use the Advice to Debit Account form to authorize payments and provide creditors' bank details. Creditors without bank accounts will be paid via bank transfers. Only valid accounts payable supported by delivery of goods/services will be paid. The guidelines assign responsibilities to agencies to manage creditor data and payments.

Uploaded by

Elizabeth Vasquez
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPTX, PDF, TXT or read online on Scribd
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Implementation of the

Expanded Modified Direct


payment Scheme(EXMDPs) for
Accounts Payable Due to
Creditors/Payees of All National
Government Agencies
Circular Letter Nos. 2013-16 dated Dec. 23, 2013, 201316A dated Feb. 6, 2014, and 2013-16B dated Feb. 25, 2014

Background
Two schemes for the payment of
Accounts Payables (A/Ps):
MDS
MDSCheck
Check0123456789

0123456789
February 20, 2015
February 20, 2015
Pay to Supplier X for the amount of
Pay to Supplier X for the amount of
One
Million
Pesos
Only
One
Million
Pesos
Only
(P1,000,000.00).
(P1,000,000.00).
____________ _________
____________ _________
Authorized signatory
Authorized signatory
Treasurer/cashier
Treasurer/cashier

List
Listof
ofDue
Due
and
and
demandable
demandable
Accounts
Accounts
Payable
Payable
Advice
Adviceto
to
Debit
Debit
Accounts
Accounts
(LDDAP-ADA)
(LDDAP-ADA)

Background
Modified Disbursement Payment Scheme (MDPS)
- Authorizes the MDS-GSB to credit payment
directly to the creditors account
Effect of its implementation:
- remove discretion in the payment of A/P
- ensure predictability of resource allocation to
these creditors
- contributed to the substantial reduction of
agencies due and demandable (A/Ps)
- minimized the volume of outstanding checks

Circular Letter No. 2013-16


Re: Implementation of the
ExMDPs for Accounts
Payable Due to
Creditors/Payees of all NGAs

Important Terms:
Accounts

Payable (A/P)

good/services/projects have been


delivered/rendered/completed and accepted,
regardless of the year of obligations incurred
Advice

to Debit Account (ADA)

Authorization issued by the NGA/OU appearing in


the lower portion of the LDDAP
Instruction to MDS-GSB to debit specified
amount from its available NCA balance under the
regular MDS sub-account for payment of A/P
Creditors/Payees

Refers to Internal and External creditors/payees

General Guidelines
Only valid and legal A/Ps shall be considered
for payment
Starting January 1, 2014, A/Ps due to
creditors/payees shall be settled thru the
ExMDPs *
All NGAs/OUs shall use the LDDAP-ADA which
shall be considered an accountable form
All NGAs/OUs shall encourage or advise their
creditors/payees to open a Current or
Savings account with any branch of their
authorized MDS-GSB [Letter of

Introduction (LOI)]

General Guidelines
For creditors without existing accounts with
NGA/OUs MDS-GSB, payment shall be
through bank transfer
Discontinue the use of Managers check
All payments of A/Ps reflected in LDDAP-ADA
are assumed duly programmed in the
agency-submitted MDP as evaluated by DBM
Prepare in four copies, a Summary of LDDAPADAs Issued and Invalidated ADA Entries
(SLIIE) for all LDDAP-ADAs issued

Specific Guidelines and


Responsibilities
NGAs/OUs shall:
Require the creditors to furnish them with
their respective bank account numbers and
bank branches
Observe the policies and procedures in the
preparing the LDDAP-ADA
In case of insufficient balance of its
Common Fund under regular MDS account,
submit a request for release of additional
NCA to cover payment of A/Ps to DBM

Specific Guidelines and


Responsibilities
NGAs/OUs shall:
Remind their creditors/payees consistent
with the auditing regulations
Automatic issuance of evidence of receipt of
payment for disbursement thru official receipts

Post on its website the following:


LDDAP-ADA numbers notice to creditors/payees
concerned
Agencys established procedures in processing
A/Ps as reflected in its Citizens Charter

Department of
Budget and
Management,
Regional Office I
01101101
060010300001
LBP San
Fernando City
Branch/
0123-456-78

Fund Category
Code Month
Series for the
month - Year
101101 02 001 2015
Feb. 20, 2015

Summary of LDDAP-ADAs Issued


and Invalidated ADA Entries (SLIIE)

Specific Guidelines and


Responsibilities

Changes/corrections in the names of


creditors:
The Head/Representative of the agency shall
be the sole authority in approving any
corrections
Corrections shall be made through a letter
authority to the MDS-GSB to be signed by the
signatories in the LDDAP-ADA
Allowed corrections:
Change of one letter in the name of creditors/payees
Abbreviations used
Correction in the name of creditor/retiree referring to
one and the same person or company

Specific Guidelines and


Responsibilities

Changes/corrections in the names


of creditors:
Non-payment due to error not falling under
the allowable typographical errors, the
agency shall include the creditors/payees
concerned in the succeeding LDDAP-ADA to
be prepared.
Only one creditor/payee - LDDAP-ADA shall be
cancelled
Multiple creditors/payees - MDS-GSB shall
indicate in the remarks portion non-payment due
to inconsistency of information

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