new standard chart of accounts kmba...
TRANSCRIPT
NEW STANDARD
CHART OF ACCOUNTS
KMBA EXPERIENCE
BEFORE NEW SCA
NEW STANDARD CHART
OF ACCOUNTS FOR MBACircular Letter 2014-41
This CL No. 2014-41 shall take effect
immediately and will be used in the
financial statement for calendar year 2014.
Signed this day of: September 25,2014.
Circular Letter (CL) No. 2014-41
The SCA for MBAs will list a
uniform system of account
numbers categorized based on
MBA’s revenue, expenses,
assets, liabilities and fund value
for similar transactions and
events, in compliance with the
latest Philippine Accounting
Standards (PAS) and Philippine
Financial Reporting Standards
(PFRS).
THE SCA FOR MBAs OBJECTIVES
1) To establish uniform, comprehensive, minimum chart of
accounts to improve financial data collection, reporting,
accuracy and comparability;
2) To meet both the internal and external reporting requirements;
3) To ensure that MBAs comply with the generally accepted
accounting principles (PAS/PFRS);
4) To allow for timely and accurate recording of financial
transactions;
5) To allow for logical framework that can be used to determine
where the funds are allocated and used in compliance with the
requirements of The Amended Insurance Code; and
6) To provide comprehensive, full disclosure of the Financial
Position of the MBA to its members and regulators.
Section 408 states that:
The constitution or bylaws of
a mutual benefit association
must distinctly state the
purpose for which dues
and/or assessments are made
and collected and the portion
thereof which may be used
for expenses.
Section 408 states that:
MUTUAL BENEFIT FUND
OPTIONAL BENEFIT FUND
– death benefits & other relief funds shall be
created & used exclusively for paying
benefits due the members under their
respective membership certificates.
GENERAL FUND
– shall likewise be created & used for
expenses of administration of the
association.
•
FUND ACCOUNTING
1. Fund Accounting is a self-balancingset of accounts, segregated forspecific purpose in accordance withlaws and regulations or specialrestrictions and limitations.
2. Emphasizing accountability ratherthan profitability.
3. Purpose:
• Manage Receipt
• Monitor Restrictions
1. Establish separate bank
account per Fund.
Fund Accounting
To apply fund accounting
MBA should:
2. Create separate books of
account per fund.
GENERAL FUND1. Cash Receipt Book2. Cash Disbursement Book3. Journal Voucher Book4. General Ledger
MUTUAL BENEFIT FUND1. Cash Receipt Book2. Cash Disbursement Book3. Journal Voucher Book4. General Ledger
OPTIONAL BENEFIT FUND1. Cash Receipt Book2. Cash Disbursement Book3. Journal Voucher Book4. General Ledger
Fund Accounting
To apply fund accounting
MBA should:
HOW KMBA APPLIED THE
NEW STANDARD CHART OF
ACCOUNTS & FUND
ACCOUNTING?
1. Input new
account title
into the
system.
KMBA APPLICATION- NEW SCA
2. Identification of all
accounts to be transferred /
adjusted into new standard
chart of account.
KMBA APPLICATION- NEW SCA
3.Reclassification of
accounts .
KMBA APPLICATION- NEW SCA
1. Established bank
account per Fund
GENERAL FUND
MUTUAL BENEFIT FUND
OPTIONAL BENEFIT FUND
Note: Purpose of several account in one bank –for easy fund transfer
KMBA APPLICATION – FUND ACCOUNTING
2. From 2014
consolidated
books, KMBA
Identified and
transferred
accounts
according to its
fund
classification.
KMBA APPLICATION – FUND ACCOUNTING
3. Any difference
between funds
will be debited/
credited to Due
to/from other
funds (Gen Fund,
MBF & OF).
KMBA APPLICATION – FUND ACCOUNTING
4. Adjustment of beginning
balances to setup separate books
per fund.
5. Segregation of Jan – July 2015
Mutual Benefit Fund, Optional
Fund and General Fund
transactions from consolidated
books.
KMBA APPLICATION – FUND ACCOUNTING
1. Segregates MBF transactions, General
Fund transactions and Optional Fund
transactions from consolidated CDB,
CRB and JV.
Note: Cash Transaction – If it is disbursed
or deposited from General Fund Bank
Account, the transactions should be included
in General Fund Book even it is MBF
transaction. This is to avoid complications in
Bank Reconciliation. But adjusting entry
should be made to transfer the transactions
to appropriate book.
KMBA SEGREGATION OF CONSOLIDATED BOOKS
2. Segregates Gen. Ledger according
to segregations made from CDB,
CRB and JV.
3. Balance/Tally the total amount of
GL per fund to the total amount of
CDB,CRB and JV per fund.
4. Creates Trial Balance per fund.
5. Prepares adjusting entry if any.
KMBA SEGREGATION OF CONSOLIDATED BOOKS
6. August 2015 - Starts
recording of transactions
according to fund
classification.
KMBA APPLICATION – FUND ACCOUNTING
.
.
• Coordination
with MIS for
the system.
• Seek Auditor’s
& other MBA
partner’s
Advise & Tips
• OJT manpower
KMBA APPLICATION – FUND ACCOUNTING
1. Adjustment to new account title.
2. One transaction required multiple
entry.
3. Manual segregation of transaction’s
entry from Jan-July (CDB, JV, CRB GL
& Trial Bal.). It was recorded in a
consolidated book.
SOME CONCERNS
4. Due to no license MIS, KMBA
maintains 3 sets of manual books
(CRB, CDB, JV & GL) 1 for Gen
Fund, 1 for Mutual Benefit Fund
and 1 for Optional fund.
SOME CONCERNS
THE POSITIVE SIDE OF NEW SCA
1. With standard chart of accounts, MBAs
are guided what account title to be
used that is applicable to MBA’s
transactions
2. Uniform account title. Consistent with
new Annual Statement format.
3. Easy monitoring of funds restrictions.
4. Clear picture of Financial Position and
Comprehensive Income per fund.
BEFORE SCA
DURING TRANSITION
DURING APPLICATION
.....The only impossible journey is the one you
never begin.....