Bonding of Accountable Officer

BONDING OF
ACCOUNTABLE OFFICER
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Introduction
Bonding of an accountable officer refers to a
process where an individual, often in a position of
financial responsibility within an organization, is
required to obtain a bond as a form of insurance or
guarantee. This bond serves to protect the
organization and its stakeholders against financial
losses resulting from any fraudulent or dishonest
actions on the part of the accountable officer.
The bonding of an accountable officer is a crucial risk
management measure in both public and private sectors,
particularly in roles where individuals handle funds, assets, or
sensitive financial information. The bond acts as a financial
safeguard, ensuring that in the event of malfeasance or dishonesty,
the affected parties can recover their losses.
In this context, an accountable officer typically refers to
someone in a position of trust and financial responsibility, such as a
treasurer, financial manager, or any individual tasked with
managing funds or assets on behalf of an organization. The bond
provides assurance to the organization's stakeholders that the
accountable officer will act in accordance with established ethical
and legal standards while handling financial matters.
Here’s some of the key aspects related to
bonding of accountable officers:
1. Definition and Purpose
- Bonding of accountable officers involves obtaining a fidelity
bond or insurance policy to protect the organization from financial
losses resulting from fraudulent or dishonest acts committed by
these officers.
2. Fidelity Bond
- A fidelity bond is a form of insurance that protects an
organization against financial losses resulting from fraudulent or
dishonest acts by its employees, including accountable officers.
3. Accountable Officers
- Accountable officers are individuals within an
organization who are entrusted with financial responsibilities,
such as handling funds, managing accounts, or overseeing
financial transactions.
4. Types of Bonds
-There are various types of fidelity bonds, including:
 Individual Bonds- Covers a specific individual or
accountable officer.
 Position Schedule Bonds- Covers a position or category of
employees with similar job responsibilities.
 Commercial Crime Insurance- Covers various types of
employee dishonesty and fraud.
5. Coverage Limits and Premiums
- The coverage limit of a fidelity bond is the maximum
amount the insurance company will pay in the event of a claim.
6. Risk Mitigation and Compliance

- Bonding accountable officers helps organizations mitigate
the risk of financial loss due to dishonest acts.
7. Claims and Investigations

-In case of suspected fraudulent activities, the organization
may file a claim with the insurance company.
8. Accountability and Ethical Behavior
- Bonding encourages accountable officers to adhere to
ethical conduct and maintain transparency in their financial
dealings.
9. Legal and Organizational Requirements

- Many jurisdictions and organizations mandate the
bonding of accountable officers, especially in the financial and
government sectors, to ensure compliance with legal and
regulatory requirements.
AMOUNT OF BOND AND DETERMINATION OF PREMIUM
1. Amount of Bond- The amount of bond shall be based on the total

accountability (cash, property and accountable forms) of the accountable
public officer a determined by the Head of Agency. Provided, the individual
maximum accountability of each accountable public officer shall not exceed
One Hundred Million Pesos (P100M).
2. Authority to Fix Schedule of Premium- The treasurer of the Philippines
with the approval of the Secretary of Finance shall fix and from time to time
review the uniform rate of the bond premium chargeable for insurance
under the Public Bonding Law and this Circular.
3. Rate of Premium- The rate of premium of the fidelity bond is equal to One
and One Half Percent (1.5%) of the amount bond but shall not be less than
One Hundred Fifty Pesos (P 150.00).
PROPERTY ACCOUNTABILITY
1. Government Securities 30% of their Total Value x1.5%= Premium
2. Equipment 30% of their Total Value x1.5%= Premium
3. Supplies and Materials 50% of their Total Value x1.5%= Premium

Accountable Forms
 Internal Revenue Stamp

 Documentary Stamp
 Custom Documentary Stamp 10% of their total
 Cash tickets value rounded off
 Postage and other stamp stocks to the nearest
 Cattle registration certificates hundred
 Marriage Certificates
 Auto driver certificates X1.5%= Premium
 Motor vehicle license
 Other accountable forms having face value
REFERENCES
https://www.treasury.gov.ph/wp-content/uploads/2017/12/Circular_FBond.pdf
https://www.treasury.gov.ph/wp-content/uploads/2021/05/TC-No.-02-2019-dated-
25-April-2019.pdf
https://www.youtube.com/watch?v=88W9eksTjgA&t=11s
https://www.treasury.gov.ph/wp-content/uploads/2017/12/Circular_FBond.pdf
THANK YOU
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BONDING OF

6. Risk Mitigation and Compliance

7. Claims and Investigations

9. Legal and Organizational Requirements

1. Amount of Bond- The amount of bond shall be based on the total

1. Government Securities 30% of their Total Value x1.5%= Premium

2. Equipment 30% of their Total Value x1.5%= Premium

3. Supplies and Materials 50% of their Total Value x1.5%= Premium

 Internal Revenue Stamp

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