i 
THIRTEENTH CONGRESS OF THE REPUBLIC 
) 
OF THE PHILIPPINES 
) 
First Regular Session 
) 
S E N A T E  
/,. . 
S. No. 
86 
Introduced by Senator S. R. OsmeAa 111 
EXPLANATORY NOTE 
This bill seeks to direct all government corporations to prepare their 
respective assets and liability management guidelines that will define the 
parameters and/or limits of their financial and operational capabilities for central 
control and monitoring by the Department of Finance. These guidelines shall 
serve as tools to anticipate, prevent and/or minimize certain eventualities that 
may adversely affect the financial condition of the corporation. The financial 
guidelines seek to limit borrowing, lending and guaranteeing any form of financial 
transaction while the operational guidelines seek to inhibit the corporation from 
engaging in activities outside its defined capabilities. 
With the passage of this bill, the parameters and limits of the operational 
and financial capabilities of government corporations will be clearly defined thus 
safeguarding the scarce resources the Filipino people owns. 
It is in this regard that the early passage of this bill is earnestly requested. 
SERGIO OSMENA 111 
Senator 


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34 JUN 30 P558 
THIRTEENTH CONGRESS OF THE REPUBLIC 
1 
OF THE PHILIPPINES 
1 
First Regular Session 
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S.E N A T E 
S. No. 
Introduced by Senator S. R. OsmeAa Ill 
AN ACT 
DIRECTING ALL GOVERNMENT CORPORATIONS TO PREPARE THEIR 
RESPECTIVE ASSET AND LIABILITY MANAGEMENT GUIDELINES THAT 
WILL DEFINE THE PARAMETERS AND/OR LIMITS OF THEIR FINANCIAL 
AND OPERATIONAL CAPABILITIES FOR CENTRAL CONTROL AND 
MONITORING BY THE DEPARTMENT OF FINANCE 
Be it enacted by the Senate and House of Represenfafives of the Philippines in 
Congress assembled: 
SECTION 
1. 
It is hereby declared a national policy to require all 
government corporations to clearly define the parameters and/or limits of their 
financial and operational capabilities consistent with their established mandates 
and charters 
SEC. 
2. 
The definition of these limits shall be embodied in their 
respective Asset and Liability Management Guidelines which is a universally 
accepted management tool whereby financial and operational activities are 
automatically confined within clearly defined limits. 
SEC. 3. Foremost among the financial guidelines are the limits on 
borrowing, lending and guaranteeing any form of financial transaction, risk and/or 
commitment. 
SEC. 4. Foremost among the operational guidelines are the recognition 
and acceptance of the limits of in-house talents and capabilities thereby inhibiting 
said corporation from engaging in activities outside its defined capabilities or in 
cases where it is necessary to engage in such transactions or activities, the 
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mandatory requirement to tap outside talents preferably from other government 
agencies or institutions. 
SEC. 5. These guidelines shall be used primarily as a tool to anticipate, 
obviate, prevent and/or minimize certain eventualities that may adversely affect 
the financial condition of individual corporations. As a standard requirement, 
however, it is seen as a vital instrument to stabilize and solidify the country's 
overall financial condition. 
SEC. 6. Adherence to these asset and liability guidelines shall be the 
responsibility of .the Department under which these corporations belong. The 
Department covered shall prescribed their respective policies and procedures 
including penalties for their violatiohs, in order to ensure that such guidelines are 
strictly complied with. 
SEC. 7. 
In line with the national policy of transparency and public 
disclosure, all government corporations are henceforth, required to publish their 
quarterly financial statements in any newspaper of major circulation. 
SEC. 
8. 
The central monitoring and control of the overall financial 
condition of these government corporations shall be made by the Department of 
Finance which shall consolidate all related figures into one report. 
SEC. 
9. 
If, for any reaSon, any provisions of this Act is declared 
unconstitutional, invalid, such sections or parts not affected thereby shall remain 
in force and effect. 
SEC. 10. All laws, decrees, executive orders, rules and regulations, or 
parts hereof inconsistent with the provision of this Act are hereby repealed, 
amended or modified accordingly. 
SEC. 11. This Act shall take effect fifteen (1 5) days after its publication in 
the Official Gazette or in at least two (2) newspapers of general circulation 
whichever comes earlier. 
Approved, 
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