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Local Treasury Operations Manual (LTOM) Overview

Legal Framework

• State Autonomy: The State shall ensure the autonomy of local governments as stipulated in the 1987 Philippine Constitution.

• General Supervision: The President oversees local governments; provinces must ensure compliance of municipalities, and vice-versa.

• Revenue Generation: Each Local Government Unit (LGU) may create its own sources of revenue by levying taxes, fees, and charges.

• National Tax Share: LGUs are guaranteed a fair share in national taxes, automatically released without further action.

LTOM Features

• Dynamic Compendium: The LTOM, 2nd Edition is a comprehensive reference designed to adapt to the evolving local financial landscape. It is revised based on stakeholder feedback and legal updates.

• Structure: The LTOM is organized into multiple volumes, each covering a specific area of local treasury operations:

  • Volume 1: Fiscal Organization

  • Volume 2: Receipt and Collection of Income

  • Volume 3: Fund Management

  • Volume 4: Administration and Collection of Taxes

Objectives of LTOM

• Guidance: Provides local treasurers updated reference materials for effective execution of their duties.

• Skill Development: Equips treasurers with necessary tools to meet operational challenges.

• Awareness: Educates treasurers on their powers and responsibilities, enhancing their role in fiscal management.

Acknowledgment and Support

• Collaboration from key stakeholders helped in drafting this updated edition, including the BLGF, EU PFM 2 Project, and ADB through various workshops.

Importance of Local Treasury Operations

• The operations of local treasurers are crucial for achieving fiscal transparency and sustainability which directly impacts local governance and economic development.

Performance Evaluation

• Fiscal Performance Monitoring: The BLGF conducts evaluations of local treasury operations to ensure compliance with laws and provide technical assistance where required.

• Fiscal Sustainability Scorecard: This tool regularly assesses LGUs on their fiscal performance, helping inform policy and identify areas for improvement.

Structural and Administrative Supervision

• BLGF’s Role: The BLGF exercises technical and administrative supervision over local treasury operations, ensuring that treasury offices adhere to regulations and improve their operational efficiency.

Training and Capacity Development

• Continuous Training Programs: Ongoing training initiatives aim to enhance the technical skills of local treasurers, ensuring they remain capable of managing local fiscal operations effectively.

Appointment Guidelines

• Appointment of Local Treasurers: Procedures for appointing local treasurers include evaluations based on educational qualifications, relevant experience, and performance ratings.

• Documentary Requirements: Strict compliance with documentation is mandatory for processing appointments, ensuring only qualified candidates are selected.

Authority and Responsibilities

Local Treasurer's Functions

• Revenue Collection: Responsible for the collection of local taxes and fees.

• Fund Management: Custodian of LGU funds, ensuring proper disbursement and management.

• Advisory Role: Advises local government officials on matters related to public finance.

• Reporting: Prepares and submits financial reports to the Local Chief Executive and the sanggunian.

Assistant Local Treasurer Role

• Assists the Local Treasurer, capable of performing the Treasurer’s functions in his/her absence.

Appendices and Annexes

List of Relevant Laws

• Updated laws affecting local government finances are included in the LTOM for reference. This includes significant laws and amendments that shape local fiscal policies.