SOP Library
SOP NO:
HR-PB08
(List of Exhibits/Attachments)
Missi
on
:
Finance and Administration
Area:
Human Resource (HR)
Activity:
Personnel Benefits and Services (HR-PB)
Title:
Fidelity Bond Application for Accountable Officer
Date Approved/Issued:
12/23/1986
Date Effective:
01/01/1987
Digest:
I. TERMS OF REFERENCE
A. Rationale
B. Objective
C. Scope
D. Basis
II. IMPLEMENTING GUIDELINES
1.
Neccesity to Bond NFA Accountable Officials and Employees
NFA accountable officials and employees shall be bonded to ensure: (1) faithful performance of all duties imposed by law upon them; (2) faithful acocunting of all funds and public property coming into their possession, custody or control thru appropriation, collection, transfer or otherwise; (3) lawful payment, disbursement and expenditure or transfer of all such funds or public property under their custody and control as accountable officers or employees.
2.
Purpose of Fidelity Bond
The Fidelity Bond shall be for the purpose of replacing defalcatuions, shortages, payment of court fees, incident to civil proceeding brought against the defaulting accountable officer to recover sums paid by NFA on their account.
3.
Bondable NFA Officials an Employees
3.1 Regular NFA employees who are appointed or designated to the folloewing accountable positions and are actually performing the functions attached to these positions:
a. Warehouse Supervisors
b. Cashiers
c. Sr. Disbursing Officers/Disbursing Officers
d. Supply Officers/Property Custodians
e. Other positions holding accountabilities
3.2 Plant Engineers, Sr. MPCs. regular MPOs shall be bonded as to their accountabilities on stocks-in-process.
3.3. Bonding of NFA Cnetral Office/and Field Office Key Officials, either appointed or designated to these ppositions, shall be undertaken only upon the discretion of COA basing on the officials needs to perform specific functions similar to that of the identified accountable positions.
3.4 Casual employees who are to be bonded shall include only those designated as Special Disbursing Officers for grains procurement operations only in case of urgent need in the exigency of the service.
3.5 No bondable official/employee shall be allowed to hold accountabilities unless his bond has been approved.
4.
Appointment or Designation of NFA Accountable Officials and Employees
4.1 Every head of office shall exercise utmost discretion in appointing or designating officials and employees to accountable positions. They shall see it that those appointed or designated to such accountable positions are unquestionnable conduct abd character as well as proven integrity.
4.2 Designation shall be undertaken in any of the following circumtances:
a. resignation or transfer of the incumbent accountable officer/employee to another without immediate replacement for that position.
b. no existing positions in the plantilla of the office/directorate but same are needed for particular purposes.
c. leave of absence of the incumbent fro at least two (2) months or indefinite leave due to suspension for any criminal or administrative charge.
4.3 Designations to accountable positions shall be effected with the issuance of Special Order by the Minister or the Regional Director for Central Office and Field Office, respectively. Request for Special Order shall be made at least one (1) month prior to asssumption to duty for Central Office bondable officers and at least one and a half months prior to assumpton to duty shall Office bondable earlier than the approval of his bond.
5.
Cancellation of Fidelity Bonds
5.1 Fidelity Bonds shall be cancelled due to anny of the following reasons.
a. retirement/resignation from service of the incumbent.
b. separation for cause from the service.
c. designation to non-acocuntable positions.
d. change in position title thru promotion/demotion.
e. termination of Special Order (SO) for specific project.
f. relief from accountability.
5.2 Cancellation of fidelity bonds of these bonded officials/employees shall be undertaken immediately once final liquidation of their accountabilities has been intiated by COA. The Provincial Manager/Regional Director/Head of Offic shall undertaken necessary actions to expedite the liquidation process.
5.3 Every head of office shall see to it that officials and employees whose fidelity bonds have been cancelled are relieved of their accountabilities.
6.
Amount of Bond
6.1 Cash Accountability
Range (in Pesos) Amount of Bond
_____________ _____________
P 500 - P 1,000 P 500
1,001 - 3,000 1,000
3,001 - 5,000 3,000
5,001 - 7,000 5,000
7,001 - 9,000 7,000
9,001 - 12,000 9,000
12,001 - 15,000 10,000
15,001 - 18,000 13,500
18,001 - 21,000 16,200
21,001 - 25,000 18,900
25,001 - 30,000 20,000
30,001 - 35,000 24,000
35,001 - 40,000 28,000
40,001 - 50,000 32,000
50,001 - 60,000 35,000
60,001 - 80,000 42,000
80,001 - 100,000 56,000
100,001 - 250,000 60,000
250,001 - 500,000 150,000
500,001 - 750,000 250,000
750,001 - 1,000,000 375,000
1,000,001 - 5,000,000 500,000
5,000,001 - 25,000,000 1,250,000
25,000,001 - 75,000,000 2,500,000
75,000,001 - 100,000,000 (& over) 3,750,000
6.2 Property Accountability
Amount of Bond
____________
a. Supplies and Materials - 50% of the total value.
b. Equipment 30 % of the total value (amount rounded off to be divisible by 100)
6.3 Accountable Forms Accountability 5% of their total face value
This shall include all NFA acocunta- (amount rounded-off to be visible by 100)
ble forms having face value used in
grains and non-grains transaction
6.4 If an accountable officer/employee handles mixed accountabilities, only one application shall be made but with separate computation for each accountability (e.g. Supply Officer/Property Custodian with property and accountable forms accountability, or MOT with cash and stock accountability.
6.5 Grains/non-grains stocks and empty sacks shall be classified under property accountability. Computation shall follow the formula used for supplies and materials.
7.
Premiums Payable
Annual premiums to be paid shall be conmputed as follows:
one-half (1/2) of one (1) percent of the total amount of bond.
Example: Amount of bond = P10,000
Premium Payable = 1/2 (.01 x P10,000)
per year = P50,00
Premium Payable = 1/4 (
.01 x P10,000)
per Semester = P25.00
8.
Criteria in Determine Amount of Accountability
Accountable Officer/Employee
Accountability
a. Supply Officer/Property Custodian - Total value of all supplies/materials and accountable forms under accountability. This shall be based on the average monthly inventory level during the last year computed based on the book value of supplies/materials.
b. Warehouse Supervisor - Total value of stock based on the average monthly balance of the warehuose during the last year. Aggreaget total shall be determined if the WS II handles more than one warehouse. Costing shall be based on the value of stock.
c. Casheir/Sr. Disbursing Officer - Total Cash Accountability.
d. Plant Engineer/Sr. MPO/MPO II - Based on the average weekly balance during the last year of sotcks on process at Ricemill/Drier/Silo being handled (refer to SOP No. GM-PG01). Costing of stocks shall be based on book value.
9.
Filing and Processing of Fidelity Bond Application
9.1 All bondable officials and employee are required to submit their Application for
Bond (Gen. Form 58A, Exhibit 2) to the Administrative Officer/Assistant at least 3 weeks (for C.O.)/4 weeks (for C.O.) prior to holding of accountasbility. The following shall be supporting documents.
a. Xerox copyy of approved appointment;
b. Xerox copy of Special Order in case of designation, either as acting or concurrent Accountable-Officer;
c. Latest Statement of Assets and Liabilities; and
d. Picture (3"x4") per application form.
9.2 The Administrative Officer/Assistant shall be responsible in seeing to the completeness of the forms and supporting documents.
For Central Office
9.3 The Director/Head of Office shall sign request for bonding of accountable officers/employees.
9.4 Application and Request for Bonding shall be endorsed to Finance, Cash Division for review particularly in the determination of the amount of accountability and the recommended amount of bond. The Finance Director shall sign the "First Indorsement" portion.
9.5 The above shall be forwarded to NFA-COA for processing and for fixing the amount of bond of the office/employee. The Corporate Auditor shall sign under the 'Second Indorsement' position.
9.6 From NFA-COA, documents shall be returned to Finance, Cash Division for submission to the Bureau of Treasury.
For Provincial Office
9.7 The branch accountant shall evalaute the application particularly in the determining of amount of accountabiblity and the recommended amount of bond.
9.8 The Provincial Manager shall sign request for bonding of acocuntable officers/employees.
9.9 Application and Request for bonding shall be forwarded to the Branch Autidtor for verification and processing which shall include fixing the amount of bond of the official/employee. He shallhenceforth initial the 'Second Indorsement' portion of the bond request.
9.10 Signatories to the 'First Indorsement' shall be the Regional Director' 'Second Indorsement' shall be signed by the Regional Auditor'
9.11 The above documents shall be forwarded by the Regional AO to Finance/C.O. for submission to the Bureau of Treasury. Such should be received by DTFM at least 10 days prior to holding of accountability.
9.12 It shall be the responsibility of Finance/Cash Division to follow-up request submitted to Bureau of Treasury. Approved bond rerquest shall be wired immediately to concerned office.
For Regional Office
9.13 Request for bonding of Regional Officals/employees shall be signed by the Regional director. He shall likewise be the signatoree on the 'First Indorsement' and the Regional Audito on 'Second Indorsement'. (It shall follow same procudure as above.)
10.
Bond Cancellation
10.1 For bond cancellation only appropriate portion in Form 57A shall be accomplished and no supporting documents are required. (Refer to Annex A for detailed instructions).
10.2 For Central Office, bond cancellation shall be requested by concerned Director/head of Office, 'First Indorsement' by Finance Director and 'Second Indorsement' by NFA-COA Corporate Audiitor.
For Provincial/Regional Office, a wire request shall be sent immediately to Finance for bond cancellation stating data as required in the form. Finance shall prepare Request for bond cancellation for signature by HRMD Director. 'First Indorsement' by Finance Director and 'Second Indorsement' by NFA-COA Corporate Auditor.
10.3 Finance/Cash Division shall be responsible in transmitting all documents to the Bureau of Treasury and shall follow-up/monitor status.
10.4 Cancelled bonds be immediately by Finance tothe concerned office.
11.
Copy Distribution of Forms
11.1 Application Form (Form 58A) shall be accomplished in foour (4) copies both for Central Office and Field Office:
1 - Directorate for Finance
2 - NFA-COA
3 - 4 Bureau of Treasury
11.2 Request for Bonding/Cancellation of Bonds (form 57A) shall be accomplished in the following number of copies:
a. Central Office
1 - Directorate for Finance
2 - NFA-COA
3 - 6 Bureau/Office of the Bondable Officer/Employee
b. Regional Office
1 - Directorate for Finance
2 - NFa-COA
3 - 6 Bureau Auditor
7 - Regional Office-Admin. Section
8 - Regional Auditor
9 - Provincial Office-Admin. Unit
11.3 Field Offices shall retain and file their respective copies. Only copies of Finance, NFA-COA and the Bureauof Treasury shall be forwarded to Finance for indorsement to the Bureau of Treasury.
12.
Request for Adjustment in the Amount of Bond/Change of Incumbents
12.1 The exinting amount of bond of the bonded officer/employee shall be concerned for adjusment in case there is substantial increase/decrease in the total accountability.
Request for such adjustment shall bemade using Form 57A - Request for Bond Application (no supporting documents required) indicating the updated amount of accountability and bond. The remarks portion should clearly state 'Increase/decrease of accoountability from __________ to _________. Hence, additional billing by the Bureau of Treasury shall be based on the increment.
12.2 In case of change of incumbents and there is simultaneous bond application and cancellation for reasons already specified (e.g. resignation and immediate appointment/designation for the same accountable position) only one form (Form 57A) shall be used for both request. The 'application' portion shall be for the incoming accountable officer and the 'cancellation' portion for the outgoing accountable officer. This shall require attachment of Application (Form 58A) for the incoming accountable officer including all other documents specified in 9.1.
The Remarks portion shall 'change of incumbent' hence no additional billing by the Bureau of Treasury.
13.
Financial Management
13.1 Basis in the payment of fidelity bond premiums shall be the Treasury Bill-Form No. 32 (Exh. 3) supported by the Statement of Account (Exh. 4) forwareded by the bureua of Treausry every semester. Accounting entry shall be as follows;
DR: Finance Division-Fidelity Bond
Premiums Expense xxx
CR: Voucher Payable xxx
DR: Voucher Payable xxx
CR: Cash in Bank xxx
13.2 Finance/cash Division shall counter-check all the entries in the statement of Account against its Master List of Bonded accountable officers and employees as to the name off bonded officer/employee, effectivity of the bond, aomunt of bond and computation of bond premiums. Any discrepancy shall be coordinated first with the Bureau of Treausry prior to payment of Bond Premium Bill.
13.3 The Finance Director shall certify to the correctness of the 'Statement of Account' and the Corporate Auditor shall verify its correctness. Corrected Statement of Account shall be the basis for payment of total bond premiums.
13.4 Finance shall retain two (2) carbon copies of the 'Statement of Account', one (1) copy to be furnished to NFA-CAO.
14.
Reporting/Record Management
14.1 It shall be the responbility of the Administrative Officer/Assistant to review regularly the listing of bonded officials/employees in the branch and to determine additions/deletions in the list and the upgrading/downgrading of bonds based on records/SOs/instruction from management. Every of the month, he shall wire Finance, Cash Division all bond applications made by the province indicating name/designation of employee and date documents fowrwarded to Regional Office.
14.2 Every end of the quarter, a Report on Bonded Officers/Employees and Bonds Cancelled (Exh. 5) shall be prepared by the AO/AA duly approved by the Provincial Manager/Regional Director/Head Office and submitted to Finance, Cash Division, copy furnished HRMD, Submission shall not be later than the 3rd working day of the suceeding month.
14.3 Finance/Cash Division shall maintain index cards (Exh. 6) which shall be prepared per individual accountable officer, to be arranged per province and per region. Same shall be updated based on incoming approved request for bond/cancellation.
At the end of the semester, Finance/Cash Division shall prepare a Master List of Accountable officers to be used for reconciliation against 'Statement of Account' forwarded by the Bureau of Treasury.
15.
Failure to File/Cancel Fidelity Bond
15.1 The Provincial Manager/Regional Director/Head of Office shall be responsible in the filing of application/cancellation of bonds. Appropriate administrative charges shall be filed against them in case they fail to comply same.
15.2 Finance shall conduct reconciliation every endd of the quarter on the approved fidelity bonds of all bondable officers/employees per province as agianst their actual assumption/termination of duty based on the quarterly reposrt submitted by all the branches. any adverse findings shall be communicated to the branch concerned and reported to the Finance Director.
16.
Claims Against Fidelity Bond
16.1 Claims against fidelity bond shall be filed only after all possible means to recover the losses against the bondable officers/employees have been exhausted.
16.2 Based on preliminary report/feedback, CAO shall notify in advance the Bureau of Treasury regarding defaulting bonded officers/employees even before the actual loss has been established.
16.3 The concerned branch/office shall recommend immediately to DEI investigation of the defaulting accountable officer/employee. Legal proceedings shall be conducted by DLA against the said officer/employee based on the findings of DEI.
16.4 Once the case brought to court has been decided, claim against fidelity bond of the bonded officer/employee shall be filed immediately. DLA shall prepare and submit its recommendation to the Corporate Auditor for filing of claim against fidelity bond supported by necessary documents, finding, examination and court decision of the case. The Corporate Auditor shall recommend approval of such claim to the Ministry of Finance thru the Bureau of Treasury.
16.5 DLA shall monitor the status of claims with the Bureau of Treasury and shall advise Finance regarding approval of same
III. RESPONSIBILITIES
1.
Bondable NFA Officer/Employee
1.1 Accomplishes General Form 53(A) to apply for fidelity bond and prepares supporting documents as required.
1.2 Secures General Form 57A (Request for bonding and/or Cancellation of Bond) from immediatee supervisor.
1.3 Submits the accomplished forms to the respective Administrative Officer/Assistant together with all the required supporting documents.
2.
Supervisor
2.1 Computes for the total amount of accountability and bond recommended for the accountable officer.
2.2 Accomplishes Request for bond and/or Cancellation of Bond (Form 57A).
3.
Administrative Officer/Assistant
3.1 Identifies all officials/employees of the branch/office.
3.2 Determines the completeness of the application forms andthe supporting docuents submitted by the applicant.
3.3 Secures 'First Indorsement' and 'Second Indorsemenrt' of the bond request.
3.4 Forwards documents to Finance/cash Division for transmittal to the Bureau of Treasury.
3.5 Prepares and sends monthly wire report and quarterly report to Finance per required data.
4.
Provincial/Regional Accountant
PACNT-24
RACNT-07
Evaluates all bond applications forwarded by the Administrative Officers/Assistant as to the correctness of accountabilities and amount of bond.
5.
Provincial Manager/C.O. Head Office
PM-53
5.1 Recommends designation/appointment of accountable personnel. Request for Special Order from the Regional Directo.
5.2 Signs Request for Bond and/or Cancellation of Bond Accountable Officer/Employee.
5.3 Recommends to DEI investigation of defaulting bonded employees under his jurisdiction.
5.4 Approves list of Bonded Accountable Officers/Employees prepared by the AO/AA.
6.
Regional Director
RD-21
6.1 Issues Special Order for the designation of accountable personnel.
6.2 Signs request for bond/cancellation of bond of Regional Office accountable officers.
6.3 Signs under the 'First Indorsement' portion of Request for Bond/Cancellation Bond from all provinces under his jurisdiction.
6.4 Recommends to DEI investigation of defaulting accountable officers under his jurisdiction.
7.
Finance-Cash Division
7.1 Secures First and Second Indorsement of Central Office bond requests.
7.2 Reviews all bond request submitted by Central and Field Offices prior to endorsement to Bureau of Treasury.Responsible for monitoring and follow-up of same.
7.3 Informs concerned branch office aproved request for bond cancellation.
7.4 Maintains index cards of bonded personnel nationwide at the end of the semester, prepares Master List of bonded personnel based on updated index cards.
7.5 Reviews 'Statement of Accounts' submitted by the Bureau of Treasury and recinciles same with the Master List. Coordinates any discrepancy with the Bureau of Treasury.
7.6 Prepares voucher for the payment of Fidelity Bond premiums based on certified and verified correct 'Statement of Account'.
7.7 Files request for cancellation of bonds of officers/employees based on wire request of field offices.
8.
Finance Director
8.1 Signs on the 'First Indorsement' portion of Central Office request for bond/cancellation of bond.
8.2 Certifies to the correctness of the 'Statement of Account' submitted by the Bureau of Treasury.
9.
HRMD Director
9.1 Signs Request for Cancellation of Bonds of field officials/employees prepared by Finance, Cash Division.
10.
D
L
A
10.1 Intiates legal proceeding against defaulting bonded officials/employee based on recommendation of DEI.
10.2 Prepares and submits recommendation to the Corporate Auditor for the filing of claims against Fidelity Bonds, supported by required documents, findings, examination including court decisions.
10.3 Monitors status of claims against fidelity bonds with the Bureau of Treasury and advises Finance regarding approval of same.
11.
D
E
I
11.1 Upon receipt of recommendation from the Provincial Manager/Regional Director/Head of Office, conducts investigation of defaulting binded officer/employee.
11.2 Submits to DLA results of the investigation.
12.
Branch COA Auditor
12.1 Evaluates and processes field offices request for bond/cancellation including fixing the amount of bond of every bondable officer/employee of the branch.
12.2 Affixes initials under the 'Second Indorsement' portion of the bond request to signafy that same has been verified and processed.
13.
Regional Auditor
13.1 Evaluates and signs on the Second Indorsement potion of field office bond request.
14.
Corporate Auditor
14.1 Signs the 'Second Indorsement' portion of the C.O. request for bond/cancellation.
14.2 Recommends approval of the NFA claims against fidelity bonds of defaulting bonded officers/employees to the Minister of Finance.
14.3 Verifies the correctness of the 'Statement of Account' in joint undertaking with the Finance Director.
IV. FLOW CHART
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