Implementation of the

Expanded Modified Direct

payment Scheme(EXMDPs) for
Accounts Payable Due to
Creditors/Payees of All National
Government Agencies
Circular Letter Nos. 2013-16 dated Dec. 23, 2013, 201316A dated Feb. 6, 2014, and 2013-16B dated Feb. 25, 2014

Background
Two schemes for the payment of
Accounts Payables (A/Ps):
MDS
MDSCheck
Check0123456789

0123456789
February 20, 2015
February 20, 2015
Pay to Supplier X for the amount of
Pay to Supplier X for the amount of
One
Million
Pesos
Only
One
Million
Pesos
Only
(P1,000,000.00).
(P1,000,000.00).
____________ _________
____________ _________
Authorized signatory
Authorized signatory
Treasurer/cashier
Treasurer/cashier

List
Listof
ofDue
Due
and
and
demandable
demandable
Accounts
Accounts
Payable
Payable
Advice
Adviceto
to
Debit
Debit
Accounts
Accounts
(LDDAP-ADA)
(LDDAP-ADA)

Background
Modified Disbursement Payment Scheme (MDPS)
- Authorizes the MDS-GSB to credit payment
directly to the creditors account
Effect of its implementation:
- remove discretion in the payment of A/P
- ensure predictability of resource allocation to
these creditors
- contributed to the substantial reduction of
agencies due and demandable (A/Ps)
- minimized the volume of outstanding checks

Circular Letter No. 2013-16

Re: Implementation of the
ExMDPs for Accounts
Payable Due to
Creditors/Payees of all NGAs

Important Terms:
Accounts

Payable (A/P)

good/services/projects have been

delivered/rendered/completed and accepted,
regardless of the year of obligations incurred
Advice

to Debit Account (ADA)

Authorization issued by the NGA/OU appearing in

the lower portion of the LDDAP
Instruction to MDS-GSB to debit specified
amount from its available NCA balance under the
regular MDS sub-account for payment of A/P
Creditors/Payees

Refers to Internal and External creditors/payees

General Guidelines
Only valid and legal A/Ps shall be considered
for payment
Starting January 1, 2014, A/Ps due to
creditors/payees shall be settled thru the
ExMDPs *
All NGAs/OUs shall use the LDDAP-ADA which
shall be considered an accountable form
All NGAs/OUs shall encourage or advise their
creditors/payees to open a Current or
Savings account with any branch of their
authorized MDS-GSB [Letter of

Introduction (LOI)]

General Guidelines
For creditors without existing accounts with
NGA/OUs MDS-GSB, payment shall be
through bank transfer
Discontinue the use of Managers check
All payments of A/Ps reflected in LDDAP-ADA
are assumed duly programmed in the
agency-submitted MDP as evaluated by DBM
Prepare in four copies, a Summary of LDDAPADAs Issued and Invalidated ADA Entries
(SLIIE) for all LDDAP-ADAs issued

Specific Guidelines and

Responsibilities
NGAs/OUs shall:
Require the creditors to furnish them with
their respective bank account numbers and
bank branches
Observe the policies and procedures in the
preparing the LDDAP-ADA
In case of insufficient balance of its
Common Fund under regular MDS account,
submit a request for release of additional
NCA to cover payment of A/Ps to DBM

Specific Guidelines and

Responsibilities
NGAs/OUs shall:
Remind their creditors/payees consistent
with the auditing regulations
Automatic issuance of evidence of receipt of
payment for disbursement thru official receipts

Post on its website the following:

LDDAP-ADA numbers notice to creditors/payees
concerned
Agencys established procedures in processing
A/Ps as reflected in its Citizens Charter

Department of
Budget and
Management,
Regional Office I
01101101
060010300001
LBP San
Fernando City
Branch/
0123-456-78

Fund Category
Code Month
Series for the
month - Year
101101 02 001 2015
Feb. 20, 2015

Summary of LDDAP-ADAs Issued

and Invalidated ADA Entries (SLIIE)

Specific Guidelines and

Responsibilities

Changes/corrections in the names of

creditors:
The Head/Representative of the agency shall
be the sole authority in approving any
corrections
Corrections shall be made through a letter
authority to the MDS-GSB to be signed by the
signatories in the LDDAP-ADA
Allowed corrections:
Change of one letter in the name of creditors/payees
Abbreviations used
Correction in the name of creditor/retiree referring to
one and the same person or company

Specific Guidelines and

Responsibilities

Changes/corrections in the names

of creditors:
Non-payment due to error not falling under
the allowable typographical errors, the
agency shall include the creditors/payees
concerned in the succeeding LDDAP-ADA to
be prepared.
Only one creditor/payee - LDDAP-ADA shall be
cancelled
Multiple creditors/payees - MDS-GSB shall
indicate in the remarks portion non-payment due
to inconsistency of information