Article 118p. 118

ADMINISTRATIVE CODE AND LAW OF PUBLIC OFFICERS TEXT AND RULES

any

General

Appropriation

Act

or

other

Acts,

the

expenditure of such appropriation shall be limited to the

employment of persons paid by the month, by the day, or

by the hour.

SECTION 36. Cash Budgets . — An operational cash

budget shall be implemented to ensure the availability of

cash resources for priority development projects and to

establish a sound basis for determining the level, type

and timing of public borrowings. The procedure, format,

accounts, and other details necessary for the execution,

monitoring and control aspects of the system shall be

determined

jointly

by the Secretary of Finance, the

Secretary

of

the

Budget

and

the Chairman of the

Commission on Audit.

SECTION 37. Creation of Appropriation Reserves . —

The

Secretary

may

establish

reserves

against

appropriations

to

provide

for

contingencies

and

emergencies which may arise later in the calendar year

and

which

would

otherwise

require

deficiency

appropriations.

The establishment of appropriation reserves shall not

necessarily mean that such portion of the appropriation

will

not

be

made

available

for expenditure. Should

conditions change during the fiscal year justifying the

use of the reserve, necessary adjustments may be made

by the Secretary when requested by the department,

office or agency concerned.

SECTION

38.

Suspension

of

Expenditure

of

Appropriations . — Except as otherwise provided in the

General

Appropriations

Act

and

whenever

in

his

judgment the public interest so requires, the President,

upon notice to the head of office concerned, is authorized

to suspend or otherwise stop further expenditure of

funds allotted for any agency, or any other expenditure

authorized in the General Appropriations Act, except for

personal services appropriations used for permanent

officials and employees.

SECTION

39.

Authority

to

Use

Savings

in

Appropriations to Cover Deficits . — Except as otherwise

provided in the General Appropriations Act, any savings in

the regular appropriations authorized in the General

Appropriations Act for programs and projects of any

department, office or agency, may, with the approval of

the President, be used to cover a deficit in any other item

of the regular appropriations: Provided , that the creation

of new positions or increase of salaries shall not be

allowed to be funded from budgetary savings except

when specifically authorized by law: Provided, further ,

that whenever authorized positions are transferred from

one program or project to another within the same

department,

office

or

agency,

the

corresponding

amounts

appropriated for personal services are also

deemed transferred, without, however increasing the

total outlay for personal services of the department, office

or agency concerned.

SECTION 40. Certification of Availability of Funds . —

No funds shall be disbursed, and no expenditures or

obligations chargeable against any authorized allotment

shall be incurred or authorized in any department, office

or agency without first securing the certification of its

Chief Accountant or head of accounting unit as to the

availability of funds and the allotment to which the

expenditure or obligation may be properly charged.

No obligation shall be certified to accounts payable

unless the obligation is founded on a valid claim that is

properly supported by sufficient evidence and unless

there

is

proper

authority

for

its

incurrence.

Any

certification for a non-existent or fictitious obligation

and/or creditor shall be considered void. The certifying

official shall be dismissed from the service, without

prejudice to criminal prosecution under the provisions of

the Revised Penal Code. Any payment made under such

certification shall be illegal and every official authorizing

or making such payment, or taking part therein or

receiving such payment, shall be jointly and severally

liable to the government for the full amount so paid or

received.

SECTION 41. Prohibition Against the Incurrence of

Overdraft . — Heads of departments, bureaus, offices and

agencies shall not incur nor authorize the incurrence of

expenditures

or

obligations

in

excess

of

allotments

released

by

the

Secretary

for

their

respective

departments, offices and agencies. Parties responsible for

the incurrence of overdrafts shall be held personally liable

therefor.

SECTION

42.

Adjustment

of

Appropriations

for

Reorganization .

—

When

under authority of law, a

function or an activity is transferred or assigned from one

agency to another, the balances of appropriations which

are determined by the head of such department to be

available and necessary to finance or discharge the

function or activity so transferred or assigned may, with

the approval of the President, be transferred to and be

made available for use by the agency to which said

function or activity is transferred or assigned for the

purpose for which said funds were originally available.

Balances

so

transferred

shall

be

credited

to

any

applicable

existing

appropriation account or to new

appropriation accounts which are hereby authorized to

be established, and shall be merged with any fund

already in the applicable existing or newly established

appropriation

account

or

accounts

and

thereafter

accounted for as one fund.

The funding requirement of agencies reorganized in

accordance

with

approved

reorganization

plans

or

reorganized pursuant to law enacted after the approval of

the General Appropriations Act, are deemed appropriated

and shall be available for expenditure as soon as the

reorganization

plans

are

approved. The Secretary of

Budget

is

hereby

authorized

to

make

necessary

adjustments

in

the

appropriations

to carry out the

provisions

of

this

section.

The

department

head

concerned, with the approval of the Secretary of Budget,

is

hereby

authorized

to

make

necessary

salary

adjustments resulting from final selection of personnel to

fill the positions in the staffing patterns of reorganized

agencies, to make necessary salary adjustments resulting

from new appointments, promotions or salary increases,

subject to the provisions of Presidential Decree No. 985.

SECTION 43. Liability for Illegal Expenditures . —

Every expenditure or obligation authorized or incurred in

violation of the provisions of this Code or of the general

and special provisions contained in the annual General or

other Appropriations Act shall be void. Every payment

made in violation of said provisions shall be illegal and

every official or employee authorizing or making such

payment,

or

taking

part

therein,

and

every

person

receiving such payment shall be jointly and severally

liable to the Government for the full amount so paid or

received.

Any official or employee of the Government knowingly

incurring any obligation, or authorizing any expenditure

in violation of the provisions herein, or taking part therein,

shall be dismissed from the service, after due notice and

hearing by the duly authorized appointing official. If the

appointing official is other than the President and should

he fail to remove such official or employee, the President

may exercise the power of removal.

SECTION 44. Accrual of Income to Unappropriated

Surplus

of

the

General

Fund .

—

Unless

otherwise

specifically provided by law, all income accruing to the

departments,

offices

and

agencies

by virtue of the

provisions of existing laws, orders and regulations shall be

deposited

in

the

National

Treasury

or

in

the

duly

authorized

depository

of

the

Government

and shall

accrue to the unappropriated surplus of the General Fund

of the Government: Provided , That amounts received in

trust and from the business-type activities of government

may

be

separately

recorded

and

be

disbursed

in

accordance with such rules and regulations as may be

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