Updated guidelines in the implementation of the Modified Direct Payment Scheme (MDPS) for the accounts payable of all National Government Agencies (NGAs) have been released by the Department of Budget and Management (DBM) in order to reduce the outstanding checks of NGAs for better cash management by the Bureau of Treasury (BTr).
NGAs are mandated to pay using the Advice to Debit Account (ADA) to all creditors/suppliers. These payees are advised to open accounts with the government servicing banks (GSBs) wherein the agency concerned has an account.
The updated guidelines also clarify procedures regarding the payment of NGAs to small creditors and other creditors that cannot be conveniently paid using the ADA thru the issuance of checks.
There are also protocols on bank transaction fees with the instruction that the supplier/creditor shall issue remittance advice to the GSBs to transfer the concerned agency’s payment to their account outside of the GSB.
In clarifying the requirement of the Official Receipt (OR) from the supplier/creditor; the OR, sales invoice or validated List of Due and Demandable Accounts Payable - Advice to Debit Accounts (LDDAP-ADA) shall form part of the Disbursement Voucher (DV) as proof of payment.
The streamlining of the preparation of the LDDAP-ADA and Summary of LDDAP-ADA and Invalidated ADA Entries for efficiency is also included in the updated guidelines.
The GSBs must credit the supplier/creditor’s account within 2 banking days upon receipt of the LDDAP-ADA from the concerned agency except for payroll which shall be credited on the same day as the ADA was issued.
To prepare the NGAs for implementation, these updated guidelines are effective on January 2, 2019.
The BTr reported outstanding checks issued by NGAs amounting to PhP 22.7 billion as of June 29, 2018.