REVEIWER (RECORDS AND PROPERTY Module 7

MANAGEMENT

Basic Principles in Property Management their original identity during the process or use, such
as land, buildings, roads, bridges, equipment or
A major portion of total resources of the Government machinery, etc.
is spent every year on acquisition, improvement or
construction of various kinds of properties. The Property Officer. An officer delegated with the
expenditures incurred on such purposes reflect authority and responsibility for safe custody and
equivalent amounts of increases in the assets of the utilization of Government properties.
Government. It is therefore important for the
Government to maintain an updated inventory of its LESSON 1: General Principles
properties at all times and ensure that those are
 The responsibility for the proper accounting,
properly maintained and utilized for rightful purposes,
safeguarding and utilization of all
that their ownership do not get diluted and that there
Government properties shall primarily rest
is always an officer who remains accountable in
upon the Head of Office.
respect of a property.
 A Head of Office, without disowning his own
Procedures for acquisition, improvement or accountability, may delegate the authority
constructions of properties have been prescribed in and responsibility for safe custody and
Procurement Manual and Finance & Accounting utilization of properties to subordinate
Manual. Some of the procedures considered essential officials, who shall be referred to as
for up-keeping of proper inventories of all Government “Property Officers”.
properties, establishment of and adherence to  All officials and organizations whose
maintenance schedules, ensuring economic and functions or duties permit or require
rightful utilization and establishment of accountability possession or custody of Government
are prescribed in this Handbook. These rules are not property shall be accountable for the
meant to be exhaustive or comprehensive as it is property and for the safe keeping of the
recognized that much will depend on the property in conformity with laws, rules and
administrative and internal control measure adopted procedures.
by the individual line agencies.  Any property received by a Government
official on behalf of the Government shall be
The following terms in these rules shall mean as accounted for as Government property and
follows: recorded in the relevant records of the
Government Agency.
Expendable properties/materials. Articles, which  Government property shall be recorded in
are consumed in use, such as fuel, stationery, the relevant records at the cost of acquisition
medicines and spare parts, which lose their identity in or at assessed value.
the process.  Every Government official shall handle and
use Government property with the same
Equipment or Machinery. The non-expendable
degree of diligence and care, which he
properties other than land, buildings and other
would exercise in handling and using his
structures, having a useful life of more than one year,
own property.
such as Motor vehicle, Plants, Furniture, Office
 Transfer of custody of Government
equipment, earth moving machinery, aircraft,
properties shall be carried out through
computers, etc.
proper handling and taking over mechanism.
Government Agency. An entity or unit of any
Public Office is a Public Trust (Sec. 1 Art. 11
administrative level, organization or corporation of the
of the 1987 Philippine Constitution; RA 6713).
Government.
Public officials and employees must at all times
Head of the Department/Agency. An officer be accountable to the people, serve them with
exercising the over-all administrative, financial and utmost honesty, responsibility, integrity, loyalty,
technical control of a Government and efficiently act with patriotism and lead
Department/Organization and/or declared as such by modest lives.
the Government.
Section 2 of Presidential Decree No. 1445
Non-expendable Properties/materials. Materials, otherwise known as The State Auditing Code
which do not lose their identity, and ordinarily retain of the Philippines states that “all resources of
the government shall be managed, expended or Audit COA), being the responsible agency in
utilized in accordance with law, rules and accounting and auditing prescribes general
regulations & safeguarded against loss or guidelines in property management. Specific laws
wastage through illegal or improper disposition and issuances are also in place to standardize
with the view of ensuring economy, efficiency, certain aspects of property management across
and effectiveness in the operation of the the bureaucracy. But even with the presence of
government”. The responsibility to take care of these policies, laws and guidelines,
such policy rests directly with the chief or the implementation still differ among agencies of the
head of the government agency concerned. government depending on their size and
structure among others
Thus, every officer of the government whose
duties require or permit the possession or Module 8 Acquisition of Government Property
custody of funds and property should adhere to
the declared policy of the state. S/he shall Acquisition refers to the act of gaining
promote the ideas of good governance in all its possession to a property or equipment by the
branches, department, agencies, subdivisions government. Acquisition may be in the form of:
and instrumentalities including Government- (1) procurement; (2) transfer from one
Owned and Controlled Corporation (GOCC) and Government Agency to another; (3)
Local Government Units (LGUs). Likewise, s/he donation/grant/gifts; (4) confiscation, seizure
shall exercise proper transparency, and foreclosure; (5) production and
accountability, responsibility and liability in manufacture; and (6) construction.
undertaking his/her duties and functions.
LESSON 1: Procurement
Subsequently, the exercise of such duties and
functions shall mean to provide good governance Republic Act No. 9184 (Government
in the implementation of programs and projects. Procurement Reform Act) and its Implementing
Rules and Regulations. This law defines
The head of the Office is primarily responsible
procurement as “the acquisition of goods,
for all government funds and properties
services and infrastructure projects by the
pertaining to his/her agency. Likewise, the person
Procuring Entity. Procurement shall also include
entrusted with the possession or custody of the
the lease of goods and real estate. With respect
funds or property shall be responsible to the head
to real property, its procurement shall be
of Office without prejudice to the liability of either
governed by the provisions of Republic Act No.
party of the government.
8974 (An Act to Facilitate the Acquisition of
LESSON 3: Property Management Right-of-Way Site or Location for National
Government Infrastructure Projects and for Other
Property management refers to the office Purposes) , and other applicable laws, rules and
administration function of the government in the regulations.
efficient acquisition, utilization and disposal of
properties and equipment. It also involves proper Government procurement, as provided in
custodianship, inventory, storage and insurance Section 3, Revised IRR of RA 9184, otherwise
of these properties. known as the Government Procurement
Reform Act which states that “all procurement of
Property management is a continuous process in the government, its departments, bureaus, offices
the government that can be generally clustered and agencies including state universities and
into three major steps namely, (1) acquisition; colleges, government-owned and controlled
(2) utilization; and (3) disposal. The processes corporations, government financial institutions,
ideally start with acquisition and ends with and local government units, shall in all cases be
disposal. There are exemptions however, governed by the following principles:
especially in land asset where disposal seem to
be inappropriate. With each of these processes  Transparency in the procurement
are number of activities or sub-processes to process and in the implementation of
ensure efficiency, transparency and procurement contracts through wide
accountability. Among these are inventory, dissemination of bid opportunities and
storage, custodianship and reporting. participation of pertinent non-
government organizations;
Laws and policies guide government agencies in  Competitiveness by extending equal
managing its properties. The Commission on opportunity to enable private contracting
 parties who are eligible and qualified to Procurement must be within approved budget,
participate in public bidding; judiciously planned, and cover essential functions,
 Streamlined procurement process for following government fiscal discipline measures and
government procurement, adaptable to IRR guidelines.
modern technology, ensures effective
and efficient methods. Section 7.2 of the IRR of RA 9184 provides that “no
 Accountability system involves procurement shall be undertake unless it is in
accordance with the approved APP of the procuring
investigating and holding public officials
entity. The APP shall bear the approval of the Head of
and private parties accountable for their
the Procuring Entity or second-ranking official
actions in procurement processes and
designated by the Head of the Procuring Entity to act
contracts.
on his behalf, and must be consistent with its duly
 Public monitoring of the procurement
approved yearly budget”.
process and the implementation of
awarded contracts with the end in view Section 7.4 of the IRR of RA 9184 states that
of guaranteeing that these contracts are “Updating of the individual PPMPs and the
awarded pursuant to the provisions of consolidated APP for each procuring entity shall be
the Act and this IRR, and that all these undertaken every six (6months or as often as may be
contracts are performed strictly required by the Head of the Procuring Entity. The
according to specifications. updating of the PPMPs shall be the responsibility of
the respective end-user units of the Procuring
RA 9184 applies to the procurement of
Entities, while the consolidation of these PPMPs into
infrastructure projects, goods, consulting
an APP shall be lodged with the BAC Secretariat,
services, regardless of sources of funds,
subject to approval of the Head of the Procuring Entity
whether local or foreign, by all and
(HOPE).
instrumentalities of government, subject to
the provisions of the Commonwealth Act  Agencies must follow procurement
No. 138 otherwise known as the “Flag guidelines and GAAM Section 424
Law”. Any treaty on international or for effective procurement plans.
executive agreement affecting the subject
matter of the Act to which the Philippine The procurement plan should outline contract type,
Government is a signatory shall be scope size, procurement methods, and expected time
observed. schedule for procurement actions. It should consider
lead time, manufacturing, and shipping times to
LESSON 2: General Procedures in ensure timely availability of goods.
Procurement
Types of Contracts.
PROCUREMENT PLANNING
As the general rule, the procurement of goods by the
Procurement planning is undertaken to Government shall be based on a fixed-price
develop the agency’s Project Procurement contract and no price adjustment/escalation shall be
Management Plan (PPMP) and Annual allowed.
Procurement Plan (APP) which will be the
basis of requisitions of supplies and other Size of Contracts.
goods.
The size and scope of individual contracts depends
An Annual Procurement Plan (APP) refers on the magnitude, nature and location of the
to the itemized list prepared by the Head of project. For projects requiring a variety of equipment,
the Agency showing the kind, estimated separate contracts shall generally be required for
quantity, estimated cost, description of each type/variety.
supplies together with the balance on hand,
if any, required by the agency for the REQUISITIONING refers to the submission of written
ensuing fiscal year. requests for goods, services and infrastructure
projects by the end user with the approval of the head
 National government agencies of the agency. The request should contain the
submit Work and Financial Plan to specifications of the items needed.
DBM by November end.
 Local government prepares annual BIDDING PROCESS
report on July 15th.
Bidding process will be conducted in accordance to Public Bidding is an open procurement method that
the Revised IRR of RA 9184 by the Bids and Awards involves pre-procurement conferences,
Committee (BAC), the BAC-Technical Working Group advertisements, pre-bid conferences, eligibility
(BAC-TWG) and BAC Secretariat. screening, bid receipt, evaluation, post-qualification,
and contract award. (For purposes of, and throughout,
Philippine Government Electronic Procurement this IRR- A the terms “Competitive Bidding” and
System (PHILGEPS) “Public Bidding” shall have the same meaning and
shall be used interchangeably).
The use of Information and Communications
Technology (ICT) in the conduct of procurement LESSON 5: Procurement through Alternative
procedures promotes transparency and efficiency. Modes
In all instances, the procuring entity shall ensure that Alternative modes shall be resorted to only in the
all procurement shall be advantageous to the highly exceptional cases provided for in the
government. Government Procurement Act (GPRA).
a. Preparation and Approval of Purchase Order/Letter Limited Source Bidding
Order or Contract.
Also known as Selective bidding involves direct
b. Preparation of Obligation Request Slip. invitation to bid from pre-selected suppliers or
consultants with proven experience and capability for
c. Inspection and Acceptance of the items/goods.
procurement of goods and services.
d. Payment of the items delivered
Limited source bidding may be resorted to under
LESSON 3: Procurement of Common-Use any of the following conditions:
Supplies, Materials and Equipment through DBM-
Procurement Service  Procurement of highly specialized types of
Goods and Consulting Services which are
 The procurement of this type of known to be obtainable only from a limited
goods is in accordance with the number of sources; or
Letter of Instructions (LOI) No. 755,  Procurement of major plant components
Executive Order (EO) Nos. 285 where it is deemed advantageous to limit the
series of 1987, 359 series of 1989, bidding to known eligible bidders in order to
and 322 series of 2000. maintain an optimum and uniform level of
 Moreover, Section 37 of EO 40 and quality and performance of the plant as a
its IRR further required the use of whole.
Electronic Procurement System
Direct Contracting/Single Source Procurement
(EPS) referred therein in these
procurements” (COA, 2011). Direct contracting is a simple procurement method
without elaborate bidding documents, requiring
Section 5 of EO 40 S.2001 allows small volume
suppliers to submit a price quotation or pro-forma
purchases of non-common-use goods, supplies, and
invoice with sale conditions, accepting offers
materials without public bidding. The Annual
immediately or after negotiations under any of the
Procurement Plan must be submitted to the
following conditions:
Department of Budget and Management by
November 15.  Procurement of items of proprietary nature
LESSON 4: Procurement through Competitive which can be obtained only from the
Bidding proprietary source, i.e. when patents, trade
secrets and copyrights prohibit others from
All procurement shall be done through competitive manufacturing the same item;
bidding, except in Rule XVI of the RA 9184 that allows  When the procurement of critical plant
alternative mode of procurement. Detailed procedure components from a specific manufacturer,
are set by the Government Procurement Policy Board supplier or distributor is a condition
(GPPB) depending on the type of items to be precedent to hold a contractor to guarantee
procured. Please refer to the GPPB issuances for its project performance, in accordance with
updates. the provisions its contract; or
 Those sold by an exclusive dealer or
Competitive Bidding manufacturer which does not have sub-
 dealers selling at lower prices and for which procuring entity directly negotiates a contract with a
no suitable substitute can be obtained at technically, legally and financially capable supplier,
more advantageous terms to the contractor or consultant.
Government.
This type of procurement occurs only in the following
Repeat Order cases:

Procurement of goods from previous winning bidder  Where there has been failure of public
for replenishing contracts awarded through bidding for the second time as provided in
Competitive Bidding, subject to following conditions: Section 35 of the Act and its IRR-A.
 In times of calamity or urgency, immediate
 Repeat order contract prices must be action is necessary to prevent damage or
identical or lower than original, ensuring restore vital public services, infrastructure,
government benefits after verification. and utilities.
 The repeat order will not result in splitting of  Take-over of rescinded contracts for
contracts, requisitions or purchase orders as immediate action to prevent damage,
provided for in Section 54.1 of IRR-A of RA property loss, or restore vital public services
9184; and utilities.
 Except in cases duly approved by the GPPB,  The principle applies to projects with
the repeat order shall be availed on only competitive bidding, similar scopes of work,
within six (6) months from the date of the contractor's contracting capacity, lower unit
Notice to Proceed arising from the original prices, no negative slippage, and
contract; and procurement negotiations commenced
 The repeat order shall not exceed twenty five before contract expiry. This principle also
percent (25%) of the quantity of each item in applies to consultancy contracts with
the original contract. consultants' unique experience and
expertise.
Shopping
 Individual consultants hired for technical,
Procuring entity requests price quotations for readily proprietary, confidential, or policy-
available off-the-shelf goods or equipment directly determining work must have a minimum six-
from known suppliers, only in cases defined in IRR of month term, renewable at the procuring
RA 9184. entity's head's option, and not exceed the
latter's term.
Shopping may be resorted to under any of the  Subject to the guidelines specified in the
following instances: IRR, purchases of goods, infrastructures and
consulting services from another agency of
 Unforeseen contingency requires immediate
the government, such as the Procurement
purchase of P50,000.00.
Service of the DBM, should be in
 Procurement of office supplies and
accordance with the Letters of Instruction
equipment exceeding P250,000.00, with no
No. 755 and Executive Order No. 359, s.
contract splitting, requires three price quotes
1989.
from genuine suppliers.
 Where the amount involved is Fifty
The GPPB reviews amounts periodically, Thousand Pesos (P50,000.00) and below:
allowing adjustments based on economic
1. That the procurement does not result in
conditions and justifiable reasons.
splitting the contracts, as provided under Section
Small Value Procurement 54.1 of the IRR-A of R.A. No. 9184.

is a method of procuring goods, infrastructure 2. That the procurement does not fall under
projects and consulting services under Section 53.9 of Shopping in Section 52 of said IRR.
revised RA 9184 IRR. Detailed guidelines on this
The above amount shall be subject to the
together with thresholds or limits is also prescribed by
periodic review by the GPPB. For this purpose,
the law.
the GPPB shall be authorized to increase or
Negotiated Procurement decrease the said amount in order to reflect the
changes in economic conditions and for other
is a method of procurement of goods, infrastructure justifiable reasons.
projects and consulting services, whereby the
TRANSFER DONATION

Under PD 1445 Section 76, any government Donation. In case of donation, a “deed of
property that is no longer needed by an agency donation” from the donor to the donee
or unserviceable maybe transferred without cost executed stipulating among others the intent
or at an appraised valuation to other government for the use of the said donation. Moreover,
agencies upon authority of the respective heads the done government agency should attach
of agencies. an “acceptance of donation” among the
papers of the donation. PSHS detailed
Transfer of Accountability for government procedure on accepting donations is crafted
property may occur under the following in lieu of a government prescribed detailed
situations: standards.
 When property is no longer serviceable Other modes of Acquisition that may be
or no longer needed is transferred from resorted to by the agency/institution.
one agency to another without cost or at
appraised value. Confiscation, Attachment or Seizure and
 When property is transferred from one Foreclosure. Properties which come into the
accountable officer to another or from ownership and possession of the
an outgoing officer to his successor. The government as a result of its implementation
former officer shall secure clearance for enforcement of laws and regulations and to
property accountability. In case of avoid accumulation and loss of their
change of accountable officers, transfer economic value as well as to generate
of property shall be affected through revenue for the government, the following
Invoice Receipt for Property. confiscated/seized property are authorized to
be disposed in accordance with existing
The following are the procedures to be laws, rules and regulations.
followed in the transfer by the property
officer: Timber and other forest
a. Make an Inventory and Inspection Report products ,Property in Customs Custody
of Unserviceable Property (IIRUP). Narcotics and Dangerous Drug
b. Preparation of Invoice Receipt of Property Production and Manufacture
(IRP) with the details of the property
Construction Production and
description, cost, etc. Manufacture

c. Approval of the transfer by the heads of construction

or their duly authorized representatives.

d. Receipt of the appropriate items by the

e. Furnish the respective accountants with

Transfer of Property

Upon initiative of owning agency or