RMC No. 78-2008 — Publishes the full text of Circular 02-2008 entitled “Clarification on the Role of the Special Allotment Release Order in the Procurement Process” Digest | Full Text

REPUBLIC OF THE PHILIPPINES DEPARTMENT OF FINANCE BUREAU OF INTERNAL REVENUE Quezon City November 12, 2008 REVENUE MEMORANDUM CIRCULAR NO. 78-2008 SUBJECT: Publishing the full text of CIRCULAR 02-2008 dated August 1, 2008 by the Chairperson of the Government Procurement Policy Board (GPPB), entitled Clarification on the Role of the Special Allotment Release Order in the Procurement Process TO : All Internal Revenue Officials, Employees and Others Concerned For the information and guidance of all concerned, quoted hereunder is the full text of Circular 02-2008 dated August 1, 2008 by the Chairperson of the Government Procurement Policy Board (GPPB): "CIRCULAR 02-2008 1 August 2008 TO : Heads of Departments, Bureaus, Offices and Agencies of the National Government, Government Owned and/or Controlled Corporations, Government Financial Institutions, State Universities and Colleges, and Local Government Units SUBJECT : Clarification on the Role of the Special Allotment Release Order in the Procurement Process ______________________________________________________________ 1.0. Purpose This circular is issued to inform procuring entities about the proper role of the Special Allotment Release Order in the procurement process. 2.0. Coverage All Departments, Bureaus, Offices and Agencies of the National Government; Government-Owned and/or �Controlled Corporations (GOCCs), including State Universities and Colleges (SUCs); and Local Government Units (LGUs). 3.0. Definition of Terms 3.1 Annual Procurement Plan or APP refers to the document that reflects the entirety of the procurement activities that will be undertaken by the procuring entity within the calendar year.

-2- It contains the following information: (i) name of the project/procurement; (ii) project management office or end- user unit; (iii) general description of the project/procurement; (iv) procurement method to be adopted; (v) time schedule for each procurement activity; and (vi) the Approved Budget for the Contract. 3.2 Approved Budget for the Contract or ABC refers to the following: 3.2.1 In the case of national government agencies, the budget for the contract duly approved by the head of the procuring entity based on its APP and embodied in the agency budget as reflected in the General Appropriations Act (GAA) or to be proposed in succeeding GAAs. 3.2.2 In the case of GOCCs, including government financial institutions, and SUCs, the corporate budget for the contract approved by their governing boards pursuant to either Executive Order No. 518, s. 1979 or Republic Act No. (R.A.) 8292; 3.2.3 In case of LGUs, the budget approved by the Sanggunian. 3.3 Special Allotment Release Order or SARO refers to a specific authority issued to one or more identified agencies to incur obligations not exceeding a given amount during a specified period for the purpose indicated. 4.0. Role of SARO in Procurement 4.1. In accordance with Section 7 of R.A. 9184, procurement may commence as long as such activity is included in the APP of the procuring entity concerned. Prior issuance of the SARO is not a pre-condition to the advertisement and/or posting of the invitation to apply for eligibility and to bid, in case of public bidding, or the posting of the notice of procurement, in case of the alternative methods of procurement. 4.2. Issuance of the SARO is, however, required before issuance of the notice of award by the procuring entity. At this point, the SARO must be in place to ensure that the certification on availability of funds, required under Section 40, Chapter 5, Book VI of Executive Order No. 292, shall be properly issued by the chief accountant of the procuring entity before any disbursement is incurred. -2-

-3- 5.0. For guidance. (Sgd) ROLANDO G. ANDAYA, JR. Chairperson" All concerned are hereby enjoined to be guided accordingly and give this Circular a wide publicity as possible. (Original Signed) SIXTO S. ESQUIVIAS IV Commissioner of Internal Revenue N-6 DAD _____ CDS _____ ZBS _____ LPO _____ FUA _____