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ANNEXG

Notes to Financial Statementtr (sample)


(All amounts in Philippine Peso unless otherwise stated)

Note I - Profile

The LGU was created by virtue of Republic Act No. ___ dated ___ . It is located east of
Manila and comprise approximately 3,000 square kilometers of land mostly devoted to
commercial establishments and housing communities. Its present population was reported at
I ,200,000 at.the end of 20 I X.

The LGU is envisioned to be a model for academic excellence, public health and safety,
environmental pres ervation and good governance, providing equal opportunity for all its
constituents in a peaceful, friendly atmosphere through a God-centered leadership of the
incumbent elected officials.

The LGU was awarded the most economically dynamic city in the Philippines for the year
2014 based on the 2014 Cities and Municipalities Competitive Index. This was due to the
City's dynamic rise as a bustling entertainment and investment destination partly because of
the introduction of a "one-day" system of licensing and issuance of business permits and the
implementation of various infrastructure projects by the national government.

Note 2 - The consolidated financial statements of the LGU have been prepared in accordance with and
comply with the Philippine Public Sector Accounting Standards (PPSAS). The consolidated
financial statements are presented in pesos, which is the functional and reporting currency of
the LGU and all values are rounded to nearest thousand (POOO) . The accounting policies have
been applied starting the year 201X.

Note 3- Summary of Significant Accounting Policies

3.1 Basis of accounting

The [consolidated] financial statements are prepared on accrual basis in accordance


with the Philippine Public Sector Accounting Standards (PPSAS).

3.2 Consolidation

The controlled entities (funds) are all those over which the controlling entity has the
power to govern the financial and operating policies. Inter-group transaction, balances
and unrealized gains and losses n tr sactions between entities and funds are eliminated
in full. The LGU maintain accounts under the General Fund for the following
economic enterprises it opera e .

General Hospital
Children's Hospital
Pamantasan ng Agham
Rainforest Adventure and Entertainment
Tanghalang Literatura
Stadium/Sports Center
Market Administration
Slaughterhouse
Youth Training Center

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Senior Citizen Health and Recreation Center
Operation of Cemetery

3.3 Interest in Joint Venture

The LGU has an interest in a joint venture which is a jointly controlled entity,
whereby the venturers have a binding arrangement that establishes joint control over
the economic activities of the entity. The LGU recognizes its interest in the joint
venture using the equity method. The LGU contributes its resources to the jointly
controlled entity ahd recognizes the contributions as an investment in the jointly
controlled entity.

3.4
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Revenue recognition

Revenue from non-exchange transactions

Taxes

The LGU recognizes revenues from taxes when the event occurs and the asset
recognition criteria are met. To the extent that there is a related condition attached that
would give rise to .a liability to repay the amount, liability is recognized instead of
revenue. Other non-exchange revenues are recognized when it is improbable that the
future economic benefit or service potential associated with the asset will flow to the
entity and the fair value of the asset can be measured reliably .

The LGU availed of the 5-year transitional provision for the recognition of Tax Revenue-
Real Property and Special Education Tax. For the first year, there will be no change in
policy for the recognition of the aforementioned tax revenue .

Transfers from other government entities

Transfers from other government entities are measured at fair value and recognized on
obtaining control of the assets (cash, goods, services and property) if the transfer is free
from conditions and it is probable that the economic benefits or service potential related
to the asset will flow to the LGU and can be measured reliably.

Revenue from exchange transactions

Rendering ofservices

The LGU recognizes reven~ndering of services by reference to the stage of


completion when the outco e transaction can be estimated reliably. The stage of
completion is measured by re renee to labor hours incurred to date as a percentage of
total estimated labor hours.

Where the contract outcome cannot be measured reliably, revenue is recognized only to
the extent that the expenses incurred.

Sale of goods

Revenue from the sale of goods is recognized when the significant risks and rewards of
ownership have been transferred to the buyer, usually on delivery of the goods and when
the amount of revenue can be measured reliably and it is probable that the economic
benefits or service potential associated with the transaction will flow to the LGU .

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Interest income

Interest income is accrue9susing the effective yield method. The effective yield discounts
estimated future cash receipts through the expected life of the financial asset to that
asset's net carrying amount. The method applies this yield to the principal outstanding to
detennine interest income each period.

Dividends

Dividends or similar distributions is recognized when the shareholder's or the LGU's


right to receive payments is established.

Re~tal inc ome

Rental income arising from operating leases on investment properties is accounted for on
a straight-lin~ basis over the lease terms and included in revenue.

3.5 Investment Property

Investment properties are measured initially at cost, including transaction costs. The
carrying amount includes the replacement cost of components of an existing investment
property at the time that cost is incurred if the recognition criteria are met and excludes
the costs of day-to-day maintenance of an investment property.

Investment property acquired through a non-exchange transaction is measured at its fair


value at the date of acquisition. Subsequent to initial recognition, investment properties
are measured using the cost model and are depreciated over the life of the asset.
Investment property are also tested for impairment and impairment losses are also
recognized when appropriate.

Investment properties are derecognized either when they have been disposed of or when
the investment property is permanently withdrawn from use. The difference between the
net disposal proceeds and the carrying amount of the asset is recognized in the surplus or
deficit in the period of derecognition. Transfers are made to or from investment property
only when there is a change in use.

3.6 Property, plant and equipment

All property, plant and equipment are stated at cost less accumulated depreciation and
impairment losses. Cost includes expenditure that is directly attributable to the
acquisition of the items. When significant parts of property, plant and equipment are
required to be replaced at intervals, the LGU recognizes such parts as individual assets
with .specific useful live~ aqd depreciates them accordingly. Likewise, when a major
inspection i~ performed, its c t is r cognized in the carrying amount of the plant and
equipment as a replaceme recognition criteria are satisfied. All other repair and
maintenance costs are rec i ed in surplus or deficit as incurred. Where an asset is
acquired in a non-exchange transaction for nil or nominal consideration the asset is
initially measured at its fair value.

Depreciation on assets is charged on a straight-line basis over the useful life of the asset.

Depreciation is charged at rates calculated to allocate cost or valuation of the asset less
any estimated residual value over its remaining useful life:

(refer to COA issuances on the prescribed usefull!fe of assets) -

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Leased assets may consist of vehicles and machinery. The assets' residual values and
useful lives are reviewed, and adjusted prospectively, if appropriate, at the end of each
reporting period. An asset's carrying amount is written down immediately to its
recoverable amount, or recoverable service amount, if the asset's carrying amount is
greater than its estimated recoverable amount or recoverable service amount. The LGU
derecognizes items of property, plant and equipment and/or any significant part of an
asset upon disposal. Any gain or loss arising on derecognition of the asset (calculated as
the difference between the net disposal proceeds and the carrying amount of the asset) is
included in the surplus or deficit when the asset is derecognized .
. ;;
Public Infrastructures were not previously recognized in the books. The LGU availed of
the , 5-year transitional provision for the .recognition of the Public Infrastructure. For the
first year of implementation of the PPSAS, the LGU will not recognize the Public
Infrastructure in the books of accounts.

3.7 Leases

LOU as a lessee

Finance leases are leases that transfer substantially all of the risks and benefits incidental
to ownership of the leased item. Assets held under a finance lease are capitalized at the
commencement of the lease at the fair value of the leased property or, if lower, at the
present value of the future minimum lease payments. The LGU also recognizes the
associated lease liability at the inception of the lease. The liability recognized is measured
as the present value of the future minimum lease payments at initial recognition .
Subsequent to initial recognition , lease payments are apportioned between finance
charges and reduction of the lease liability so as to achieve a constant rate of interest on
the remaining balance of the liability. Finance charges are recognized as finance costs in
surplus or deficit.

An asset held under a finance lease is depreciated over the useful life of the asset.
However, if there is no reasonable certainty that the LGU will obtain ownership of the
asset by the end of the lease term, the asset is depreciated over the shorter of the
estimated useful life of the asset and the lease term.

Operating leases are leases that do not transfer substantially all the risks and benefits
incidental to ownership of the leased item to the LGU . Operating lease payments are
recognized as an operating expense in surplus or deficit on a straight-line basis over the
lease term.

LOU as a lessor

Leases in which the LGU does not. transfer substantially all the risks and benefits of
ownership of an asset are class~ fied s rating leases. Initial direct costs incurred in
negotiating an operating lease a a a to the carrying amount of the leased asset and
recognized over the lease term.

Rent received from an operating lease is recognized as income on a straight-line basis


over the lease term. Contingent rents are recognized as revenue in the period in which
they are earned.

3.8 Intangible assets

Intangible assets acquired separately are initially recognized at cost. The cost of
intangible assets acquired in a non-exchange transaction is their fair value at the date of
the exchange. Following initial recognition, intangible assets ate carried at cost less any

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accumulated amortization and accumulated impairment losses. Internally generated
intangible assets, excluding capitalized development costs, are not capitalized and
expenditure is ret1ected iu surplus or deficit in the period in which the expenditure is
incurred.

The useful life of the intangible assets is assessed as either finite or indefinite. Intangible
assets with a finite life is amortized over its useful life.

Intangible assets with a finite useful life are assessed for impainnent whenever there is an
indication that the asset may be impaired. The amortization period and the amortization
method, for an intangible asset with a finite useful life, are reviewed at the end of each
reRprting period. Changes in the expected useful life or the expected pattern of
consumption of future economic benefits embodied in the asset are considered to modify
the an1ortization period or method, as appropriate, and are treated as changes in
accounting estimates. The amortization expense on an intangible asset with a finite life is
recognized iu surplus or deficit as the expense category that is consistent with the nature
of the intangible asset.

Gains or losses arising from derecognition of an intangible asset are measured as the
difference between the net disposal proceeds and the carrying amount of the asset and are
recognized in the surplus or deficit when the asset is derecognized.

Research and Development Cost

Research costs when incurred are treated as expenses by the LGU. Development costs on
an individual project are recognized as intangible assets when the LGU can demonstrate:

a) The technical feasibility of completing the asset so that the asset wi II be


available for use or sale;

b) Its intention to complete and its ability to use or sell the asset;

c) How the asset will generate future economic benefits or service potential;

d) The availability of resources to complete the asset; and

e) The ability to measure reliably the expenditure during development.

Following initial recognition of an asset, the asset is carried at cost less any accumulated
amortization and accumulated impainnent losses. Amortization of the asset begins wh~n
development is complete and the asset is available for use. It is amortized over the period
of expected future benefit. During the pe of development, the asset is tested for
impairment annually with any imp t losses recognized immediately in surplus or
deficit.

3.9 Impairment of non-financial assets

Impairment of cash-generating assets

At each reporting date, the LGU assesses whether there is an indication that an asset may
be impaired. If any indication exists, or when annual impainnent testing for an asset is
required, the LGU estimates the asset's recoverable amount. An asset' s recoverable
amount is th~ higher of an asset's or cash-generating unit's fair value less costs to sell and
its value in use and is detennined for an individual asset, unless the asset does not
generate cash inflows that areiargely independent of those from other assets or groups of
assets.

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Where the carrying amount of an asset or the cash-generating unit (CGU) exceeds its
recoverable amount, the sset is considered impaired and is written down to its
recoverable amount. In assessing value in use, the estimated future cash flows are
discounted to their present value using a discount rate that reflects current market
assessments of the time value of money and the risks specific to the asset. In determining
fair value less costs to sell, recent market transactions are taken into account, if available.
If no such transactions can be identified, an appropriate valuation model is used.

Impairment losses of continuing operations, including impairment on inventories, are


recognized in the statement of financial performance in those expense categories
-
consistent with the nature of the impaired asset.
'

An assessment is made at each reporting date as to whether there is any indication that
previously recognized impairment losses may no longer exist or may have decreased. If
such indicat,ion exists, the LGU estimates the asset's or cash-generating unit's
recoverable amount. A previously recognized impairment loss is reversed only if there
has been a change in the assumptions used to determine the asset's recoverable amount
since the last impairment loss was recognized. The reversal is limited so that the carrying
amount of the asset does not exceed its recoverable amount, nor exceed the carrying
amount that would have been determined, net of depreciation, had no impairment loss
been recognized for the asset in prior years. Such reversal is recognized in surplus or
deficit.

Impairment of non-cash-generating assets

The LGU assesses at each reporting date whether there is an indication that a non-cash-
generating asset may be impaired. If any indication exists, or when annual impairment
testing for an asset is required, the LGU estimates the asset's recoverable service amount.
An asset's recoverable service amount is the higher of the non-cash generating asset's
fair value less costs to sell and its value in use.

Where the carrying amount of an asset exceeds its recoverable service amount, the asset
is considered impaired and is written down to its recoverable service amount.

In assessing value in use, the LGU has adopted the depreciation replacement cost
approach. Under this approach, the present value of the remaining service potential of an
asset is determined as the depreciated replacement cost of the asset. The depreciated
replacement cost is measured as the reproduction or replacement cost of the asset,
wh ichever is lower, less accumulated depreciation calculated on the basis of such cost, to
reflect the already consumed or expired service potential of the asset. In determining fair
value less costs to sell, the price of the assets in a binding agreement in an arm's length
transaction, adjusted for incremental costs that would be directly attributed to the disposal
of the asset is used. If there is no 15indirrg agreement, but the asset is traded on an active
market, fair value less cost to sell is th sset' arket price less cost of disposal. If there
is no binding sale agreement or act1 et for an asset, the LG U determines fair value
less cost to sell based on the best ava ab e information .

For each asset, an assessment is made at each reporting date as to whether there is any
indication that previously recognized impairment losses may no longer exist or may have
decreased. If such indication exists, the LGU estimates the asset's recoverable service
amount. A previously recognized impairment loss is reversed only if there has been a
change in the assumptions used to determine the asset's recoverable service amount since
the last impairment loss was recognized. The reversal is limited so that the carrying
amount of the asset does not exceed its recoverable service amount, nor exceed the
carrying amount that would have been determined, net of depreciation, had no
impairment loss been recognized for the asset in prior years. Such reversal is recognized
in surplus or deficit.

3.10 Financial instruments

Financial assets

Initial recognition and measurement

Financial assets are classified as financial assets at fair value through surplus or deficit,
loans and receivables, held-to-maturity investments or available-for-sale financial assets,
as f ppropriate. The LGU determines the classification of its financial assets at initial
recognitio n.

Purchases or sales of financial assets that require delivery of assets within a time frame
established gy regulation or convention in the marketplace (regular way trades) are
recognized on the trade date, i.e ., the date that the LGU commits to purchase or sell the
asset.

The LGU ' s financial assets include: cash and short-tenn deposits; trade and other
receivables ; loans and other receivables and quoted and unquoted financial instruments.

Subsequent measurement

The subsequent measurement of financial assets depends on their classification.

Financial assets at fair value through surplus or deficit

Financial assets at fair value through surplus or deficit include financial assets held for
trading and financial assets designated upon initial recognition at fair value through
surplus and deficit. Financial assets are classified as held for trading if they are acquired
for the purpose of selling or repurchasing in the near term. Financial assets at fair value
through surplus or deficit are carried in the statement of financial position at fair value
with changes in fair value recognized in surplus or deficit.

Loans and receivables

Loans and receivables are non-derivative financial assets with fixed or determinable
payments that are not quoted in an active market. After initial measurement, such
financial assets are subsequently measured t a rti cost using the effective interest
method, less impairment. Amortized cos c culated by taking into account any
discount or premium on acquisition and fe costs that are an integral part of the
effective interest rate. Losses arising from impairment are recognized in the surplus or
deficit.

Held-to-maturity

Non-derivative financial assets with fixed or determinable payments and fixed maturities
are classified as held to maturity when the LGU has the positive intention and ability to
hold it to maturity. After initial measurement, held-to-maturity investments are measured
at amortized cost using the effective interest method, less impairment. Amortized cost is
calculated by taking into account any. discount or premium on acquisition and fees or
costs that are an integral part of the effective interest rate. The losses arising from
impainnent are recognized in surplus or deficit. r

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Derecognition

The LGU derecognizes a..fjnancial asset or, where applicable, a part of a financial asset or
part of a group of similar financial assets when:
.....
a) The rights to receive cash flows from the asset have expired or is waived;

b) The LGU has transferred its rights to receive cash flows from the asset or has
assumed an obligation to pay the received cash flows in full without material
delay to a third party; and either: (a) the LGU has transferred substantially all
the risks and rewards of the asset; or (b) the LG U has neither transferred nor
retained substantially all the risks and rewards of the asset, but has transferred
c ontrol of the asset.

Impairment offinancial assets


"
The LGU assesses at each reporting date whether there is objective evidence that a
financial asset or a group of financial assets is impaired. A financial asset or a group of
financial assets is deemed to be impaired if, there is objective evidence of impairment as
a result of one or more events that has occurred after the initial recognition of the asset
(an incurred ' loss event' ) and that loss event has an impact on the estimated future cash
flows of the financial asset or the group of financial assets that can be reliably estimated.
Evidence of impairment may include the following indicators:

a) The debtors or a group of debtors are experiencing significant financial


difficulty ;

b) Default or delinquency in interest or principal payments;

c) The probability that debtors will enter bankruptcy or other financial


reorganization; and

d) Observable data indicates a measurable decrease in estimated future cash flows


(e.g. changes in arrears or economic conditions that correlate with defaults)

Financial assets carried at amortized cost

For financial assets carried at amortized cost, the LGU first assesses whether objective
evidence of impairment exists individually for financial assets that are individually
significant, or collectively for fin.ancial assets that are not individually significant. If the
LGU detennines that no ob]ectiv. ev nee of impairment exists for an individually
assessed financial asset, whet ificant or not, it includes the asset in a group of
financial assets with similar cr d1 isk characteristics and collectively assesses them for
impairment. Assets that are individually assessed for impairment and for which an
impairment loss is, or continues to be, recognized are not included in a collective
assessment of impairment.

If there is objective evidence that an impairment loss has been incurred, the amount of the
loss is measured as the difference between the assets carrying amount and the present
value of estimated future cash flows (excluding future expected credit losses that have
not yet been incurred). The present value of the estimated future cash flows is discounted
at the financial asset's original effective interest rate. !fa loan has a variable interest rate,
the discount rate for measuring any impairment loss is the current effective interest rate.

The carrying amount of the asset is reduced through the use of an allowance account and
amount of the estimated impairment loss increases or decreases because of an event
occurring after the impairment was recognized, the previously recognized impairment
loss is increased or redu~t;d by adjusting the allowance account. If a future write-off is
later recovered, the recovery is credited to finance costs in surplus or deficit.
.....
Financial liabilities

Initial recognition and measurement

Financial liabilities within the scope of IPSAS 29 are classified as financial liabilities at
fair value through surplus or deficit or loans and borrowings, as appropriate. The LGU
det~rmin~ the classification of its financial liabilities at initial recognition.

All financial liabilities are recognized initially at fair value and, in the case of loans and
borrowings.
"
The LGU Group 's financial liabilities include trade and other payables, bank overdrafts,
loans and borrowings.

Subsequent measurement

The measurement of financial liabilities depends on their classification.

Financial liabilities at fair value through surplus or defic it

Financial liabilities at fair value through surplus or deficit include financial liabilities held
for trading and financial liabilities designated upon initial recognition as at fair value
through surplus or deficit.

Loans and borrowings

After initial recognition, interest bearing loans and borrowings are subsequently
measured at amortized cost using the effective interest method . Gains and losses are
recognized in surplus or deficit when the liabilities are derecognized as well as through
the effective interest method amortization process.

Amortized cost i~ 'ca cui ed by taking into account any discount or premium on
acquisition and fees sts that are an integral part of the effective interest rate.

Derecognition

A financial liability is derecognized when the obligation under the liability is discharged
or cancelled or expires.

When an existing financial liability is. replaced by another from the same lender on
substantially different terms, or the terms of an existing liability are substantially
modified, such an exchange or modification is treated as a derecognition of the original
liability and the recognition of a new liability.

Offsetting offinancial instruments

Financial assets and financial liabilities are offset and the net amount reported in the
consolidated statement of financial position if, there is a currently enforceable legal right
to offset the recognized amounts and there is an intention to settle on a net basis, or to
realize the assets and settle the liabilities simultaneously.

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:, ..

Fair value offinancial instruments

The fair value of financial instruments that are traded in active markets at each reporting
date is determined by reference to quoted market prices or dealer price quotations (bid
price for long po sitions and ask price for short positions), without any deduction for
transaction costs.

3.11 Cash and cash equivalents

Cash and cash equivalents comprise cash on hand and cash at bank, deposits on call and
highly liquid investments with an original maturity of three months or less, which are
readily convertible to known amounts of cash and are subject to insignificant risk of
changes i n value. For the purpose of the consolidated statement of cash flows, cash and
cash equivalents consist of cash and short-term deposits as defined above, net of
outstanding bank overdrafts.

3.12 Inventories

Inventory is measured at cost upon initial recognition. To the extent that inventory was
received through non-exchange transactions (for no cost or for a nominal cost), the cost
of the inventory is its fair value at the date of acquisition.

Costs incurred in bringing each product to its present location and condition are
accounted for, as follows:

a) Raw materials: purchase cost using the weighted average cost method;

b) Finished goods and work in progress: cost of direct materials and labor and a
proportion of manufacturing overheads based on the normal operating capacity,
but excluding borrowing costs.

After initial recognition, inventory is measured at the lower of cost and net realizable
value. However, to the extent that a class of inventory is distributed or deployed at no
charge or for a nominal charge, that class of inventory is measured at the lower of cost
and current replacement cost.

Net rdtli2able value is the estimated selling price in the ordinary course of operations,
less the es ated costs of completion and the estimated costs necessary to make the sale,
exchan 1stribution. Inventories are recognized as an expense when deployed for
consumption in the ordinary course of operations of the LGU.

3.13 Provisions
~
Provisions are recognized when the LGU has a present obligation (legal or constructive)
as a result of a past event, it is probable that an outflow of resources embodying
economic benefits or service potential will be required to settle the obligation and a
reliable estimate can be made of the amount of the obligation.

Where the LGU expects some or all of a provision to be reimbursed, for example, under
an insurance contract, the reimbursement is recognized as a separate asset only when the
reimbursement is virtually certain.

The expense relating to any provision is presented in the statement of financial


performance net of any reimbursement. _

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Rehabilitation liability

Rehabilitation costs are_grovided at the present value of expected costs to settle the
obligation using estimated cash flows and are recognized as part of the cost of that
particular asset. ""The cash flows are discounted at a current rate that reflects the risks
specific to the rehabilitation liability. The unwinding of the discount is expensed as
incurred and recognized in the statement of financial performance as a finance cost. The
estimated future costs of decommissioning are reviewed annually and adjusted as
appropriate. Changes in the estimated future costs or in the discount rate applied are
added to or deducted;Jrom the cost of the asset.

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Co~tingent liabilities

The LGU does not recognize a contingent liability, but discloses details of any
contingencies in the notes to the financial statements, unless the possibility of an outflow
of resources __embodying economic benefits or service potential is remote.

Contingent assets

The LGU does not recognize a contingent asset, but discloses details of a possible asset
whose existence is contingent on the occurrence or non-occurrence of one or more
uncertain future events not wholly within the control of the LGU in the notes to the
financial statements. Contingent assets are assessed continually to ensure that
developments are appropriately reflected in the financial statements. If it has become
virtually certain that an inflow of economic benefits or service potential will arise and the
asset's value can be measured reliably, the asset and the related revenue are recognized in
the financial statements of the period in which the change occurs.

3.14 Nature and purpose of reserves

The LGU creates and maintains reserves in terms of specific requirements .

Sinking Fund

LGUs maintains sinking fund as required in the agreements for issuance/acquisition of


long term indebtednes . T funds maintained are used to pay the interest and the
amortization of the . Cash back up are placed in investments until utilized.

3.15

The LGU recognizes the effects of changes in accounting policy retrospectively. The
effects of changes in accounting policy are applied prospectively if retrospective
application is impractical.

The LGU recognizes the effects of changes in accounting estimates prospectively by


including in surplus or deficit.

3.16 Foreign currency transactions

Transactions in foreign currencies are initially accounted for at the rate of exchange on
the date of the transaction. Trade payables or receivables denominated in foreign
currency are reported at the statement of financial position reporting date by applying the
exchange rate o~ that date. Exchange differences arising from the settlement of creditors,
or from the reporting of creditors at rates different from those at which they were initially
recorded during the period, are recognized as income or expenses in the period in which
they arise. _

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3.17 Borrowing costs

Borrowing costs are recognized under the allowed alternative treatment, wherein costs
are recognized as expense in the period in which they are incurred, except the costs that
are directly attributable to the acquisition, construction, or production of a qualifying
asset which are recognized as part of the cost of the asset. Such borrowing costs are
capitalized over the period during which the asset is being acquired or constructed and
borrowings have been incurred. Capitalization ceases when construction of the asset is
complete. Further, borrowing costs are charged to the statement of financial performance.
F:
3.18 Related parties
'\
The LQ U regards a related party as a person or an entity with the ability to exert control
individually or jointly, or to exercise significant influence over the LGU , or vice versa.
Members of key management are regarded as related parties and comprise the Governor,
Mayors, Vice-Governors and Vice-Mayors, Sanggunian Members, and Department
Heads.

3.19 Service concession arrangements

The LGU analyses all aspects of service concession arrangements that it enters into
determining the appropriate accounting treatment and disclosure requirements. In
particular, where a private party contributes an asset to the arrangement, the LGU
recognizes that asset when, it controls or regulates the services the operator provides
together with the asset, to whom it must provide them, and at what price. Any assets so
recognized are measured at their fair value. To the extent that an asset has been
recognized, the LGU also recognizes a corresponding liability, adjusted by a cash
consideration paid or received.

3.20 Budget information

The annual budget is prepared on the modified cash basis, that is, all planned costs and
income are presented in a single statement to determine the needs of the LGU. As a result
of the adoption of the modified cash basis for budgeting purposes, there are bases, timing
or entity differences that would require reconciliation between the actual comparable
amounts and the amounts pre~ented as disclosures of the statement of comparison of
budget and actual amounts. Expla ory mments are provided in the notes to the annual
financial statements for reason rall growth or decline in the budget and the details
of overspending or underspendin n line items.

3.21 Significant judgments and sources of estimation uncertainty

Judgments

In the process of applying the LGU ' s accounting policies, management has made
judgments, which have the most significant effect on the amounts recognized in the
consolidated financial statements.

Operating lease commitments - LG U as lessor

The LGU has entered into property leases of certain properties. The LGU has determined,
based on an evaluation of the ,terms and conditions of the arrangements, (such as the lease
term not constituting a substantial portion of the economic life of the commercial
property) that it retains all the significant risks and rewards of ownership of the properties
and accounts for the contracts as operating leases.

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Estimates and assumptions

The key assumptions c .nceming the future and other key sources of estimation
uncertainty at the reporting date, that have a significant risk of causing a material
adjustment to the carrying amounts of assets and liabilities within the next financial year,
are described below. The LGU based its assumptions and estimates on parameters
available when the consolidated financial statements were prepared. However, existing
circumstances and assumptions about future developments may change due to market
changes or circumstances arising beyond the control of the LGU. Such changes are
reflected in the assumptions when they occur.

Useful lives and residual values


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The useful lives and residual values of assets are assessed using the following indicators
to inform potential future use and value from disposal:

a) The condition of the asset based on the assessment of experts employed by the
LGU;

b) The nature of the asset, its susceptibility and adaptability to changes m


technology and processes;

c) The nature of the processes in which the asset is deployed; and

d) Changes in the market in relation to the asset

Impairment of non-financial assets- cash-generating assets

The recoverable amounts of cash-generating units and individual assets have been
determined based on. the higher of value-in-use calculations and fair values less costs to
selL These calcu~ati s require the use of estimates and assumptions. It is reasonably
possible that th tions may change, which may then impact management's
estimations andre a material adjustment to the carrying value of tangible assets .

The LGU reviews and tests the carrying value of assets when events or changes in
circumstances suggest that the carrying amount may not be recoverable. Cash-generating
assets are grouped at the lowest level for which identifiable cash flows are largely
independent of cash flows of other assets and liabilities. If there are indications that
impairment may have occurred, estimates of expected future cash flows are prepared for
each group of assets. Expected future cash flows used to determine the value in use of
tangible assets are inherently uncertain and could materially change over time.

Impairment of non-financial assets- non- cash generating assets

The LGU reviews and tests the carrying value of non-cash-generating assets when events
or changes in circumstances suggest that there may be a reduction in the future service
potential that can reasonably be expected to be derived from the asset Where indicators
of possible impairment are present, the LGU undertakes impainnent tests. which require
the determination of the fair value of the asset and its recoverable service amount. The
estimation of these inputs into the calculation relies on the use estimates and assumptions.

Any subsequent changes to the factors suppgrting these estimates and assumptions may
have an impact on the reported carrying amount of the related asset
"\

! 13
Fair value estimation - financial instruments

Where the fair value of financial assets and financial liabilities recorded in the statement
of financial position cannot be derived from active markets, their fair value is determined
using valuation ffchniques including the discounted cash flow model. The inputs to these
models are taken from observable markets where possible, but where this is not feasible,
judgJnent is required in establishing fair values. Judgment includes the consideration of
inputs such as liquidity risk, credit risk and volatility. Changes in assumptions about
these factors could affect the reported fair value of financial instruments.
~ .
Provisions

Provisions were raised and management determined an estimate based on the information
available. Provisions are measured at the management's best estimate of the expenditure
required to settle the obligation at the reporting date, and are discounted to present value
where the effect is material.

Held-to-maturity investments and loans and receivables

The LOU assesses its loans and receivables (including trade receivables) and its held-to-
maturity investments at the end of each reporting period. In determining whether an
impairment loss should be recorded in surplus or deficit, the LGU evaluates the indicators
present in the market to determine if those indicators are indicative of impairment in its
loans and receivables or held-to-maturity investments.

Where specific impairments have not been identified the impairment for trade
receivables, held-to-maturity investments and loans and receivables is calculated on a
portfolio basis, based on historical loss ratios, adjusted for national and industry-specific
economic condttiofls and other indicators present at the reporting date that correlate with
defaults on the R.Nf~ These annual loss ratios are applied to loan balances in the
portfolio and sc~e,,o the estimated loss emergence period.

3.22 Financial instruments- financial risk management

Exposure to currency, commodity, interest rate, liquidity and credit risks arises in the
normal course of the LOU' s operations. This note presents information about the LOU's
exposure to each of the mentioned risks, policies and processes for measuring and
managing risk, and the LGU's management of capital. Further quantitative disclosures
are included throughout these financial statements. Fair values set out below, is a
comparison by class of the carrying amounts and fair value of the LOU's financial
instruments.

The {air Vqlue of the financial assets and liabilities are included at the amount at which
the instrum"ent could be exchanged in a current transaction between willing parties, other
than in a forced sale or liquidation.

The following methods and assumptions were used to estimate the fair values:

a) Cash and short-term deposits, trade receivables, trade payables and other current
liabilities approximate their carrying amounts largely due to the short-term maturities
of these instruments;

b) Long-term fixed-rate and variable-rate receivables I borrowings are evaluated by the


LOU based on parameters such as interest rates, individual creditworthiness of the
customer and the risk characteristics of the financed project. Based on this
evaluation, allowances are taken to account for the incurred losses of these
receivables and market related interest rates. As at 31 December 2015 the carrying
amounts of such receivables, net of allowances, are not materially different from
their calculated fair values;

c) Fair value 6 f quoted notes and bonds is based on price quotations at the reporting
date. The fair value of unquoted instruments, loans from banks and other financial
.liabilities, obligations under finance leases, as well as other non-current financial
liabilities is estimated by discounting future cash flows using rates currently
available for debt on similar terms, credit risk and remaining maturities;

d) Fair value of financial assets is derived from quoted market prices in active markets,
if a~ilable;

e) Fair value of unquoted available-for-sale financial assets is estimated using


appropriate valuation techniques

Fair value hierarchy

The LGU uses the following hierarchy for determining and disclosing the fair value of
financial instruments by valuation technique:

Level I: Quoted (unadjusted) prices in active markets for identical assets or liabilities;

Level 2: Inputs other than quoted prices included within Level I that are observable for
the asset or liability, either directly (i .e., as price) or indirectly (i.e., derived from prices);

Level 3: Techniques which use inputs that have a significant effect on the recorded fair
value that are not based on observable market data

As at 31 December 2015 , the LGU held the following financial instruments measured at
fair value:

201X Level 1 Level2 Level3


Investments XXX XXX XXX
XXX XXX XXX

During the reportin ding December 31 , 20 15, there were no transfers between
levels 1 and 2 fair easurements

Credit risk

Credit risk is the risk of financial loss to the LGU if customers or counterparties to
financial instruments fail to meet their contractual obligations, and it arises principally
from the LGU ' s investments, loans, receivables, and cash and cash equivalents. The
carrying amount of financial assets represents the maximum credit exposure. The
maximum exposure to credit risk as at 31 December was:

201X 201X
Investments XXX XXX
Trade receivables and other receivables XXX XXX
Cash and cash equivalent XXX XXX
Maximum exposure to creditrisk XXX XXX

r~5
Credit quality

Credit quality is assessed...risk of default attached to counterparties to which the LOU


extends credit and also those parties with whom the LOU invests. As such, the credit
quality assessed extends to the customers, investments and banks servicing the LOU .

For financial statement purposes, the investments and balances with banks are limited to
the investments, loans receivable and cash and cash equivalents line items in the
statement of financial position. The LOU follows Department Order No. 27-05 of the
t ,' ' Department of Finance (DOF) in the maintenance of depository accounts. It also
determines credit quality of the investments and banks using information obtained from
extC(rnal J!ting agencies. In accordance with its financial risk management policy, the
LGU-qoes not invest in instruments with a credit rating below_ and does not advance
loans to counterparties with a credit rating below _ _ .

20IX 20IX
Rating Rating
Investments
Loans receivables
Cash and cash equivalent

The customer base of the Group is diverse and consists of individuals, companies, non-
profit organizations and government entities. Credit ratings, from external rating
agencies, are not readily available for all customers. Also, it is not financially viable to
obtain external credit ratings for all customers due to the nature of the customer base.
Furthermore, the LOU , as a local government authority, is mandated under Republic Act
No . 7160 or the local Government Code to provide basic services to all its constituents
irrespective of their financial standing. As such, the LOU is required, by legislation, to
extend services and extended payment terms to all customers irrespective of their
financial standing. For the purpose of detennining the credit quality of customers, the
LG. U applies its past experie~%tf~ustomers in determining the risk of default posed
by customers. In line with ltflfethodology applied, customers are classified into the
following credit quality groups:

a) High - Those customers who have no history of defaulting on payments to the


Group and only includes customers who settle their accounts in full and within the
prescribed minimum period;

b) Medium- Those customers with a history of late payments only. These customers
usually arrange ahead of time with the Group in settling balances in arrears and
when payments are made, the outstanding amounts (including interest) are settled in
full; and

c) Low - Those customers with a significant history of defaults. The balances of these
customers are rarely settled in full. The recovery of outstanding balances from these
customers is problematic.

The credit quality of the balance of receivables and other receivables is made up, as
follows :

16
201X 201X
High XXX XXX
Medium XXX XXX
Low XXX XXX
Total instrument at amortized cost exposed to
credit risk XXX XXX

Investments

Th~; LG)l limits its exposure to credit risk by investing with only reputable financial
institutions that have a sound credit rating (rated BB and above), which are within the
specific guidelines set in accordance with the LGU Finance Committee and the
Sanggunian approved investment policy. Consequently, the LGU does not consider this
to be any sign ificant exposure to credit risk.

Receivables

Receivables are amounts owed by consumers, and are presented net of impainnent losses.
The LGU has a credit risk policy in place, and the exposure to credit risk is monitored on
an ongoing basis. The LGU is compelled, by its constitutional mandate, to provide all of
its residents with basic minimum services, without recourse to an assessment of
creditworthiness. There were no material changes in the exposure to credit risk and its
objectives, policies and processes for managing and measuring the risk during the year
under review.

The LGU ' s maximum exposure to credit risk is represented by the carrying value of each
financial asset in the statement of financial performance. The Group has no significant
concentration of credit risk, with exposure spread over a large number of consumers, and
is not concentrated in any particular sector or geographic area.

The LGU establishes an allowance for impairment that represents its estimate of
anticipated losses in respect of receivables.

The outstanding amounts of the 10 largest debtors represent 0.8% (20 12: 1.2%) of the
total outstanding balance. lnteJest is raised at the three-month government bond rate plus
1% on any unpaid accounts fter t e due date. The LGU provided fully for all receivables
outstanding over 365 ere there was no evidence of expected recovery.
Receivables up to 365 d s are provided for based on estimated irrecoverable amounts,
determined by reference to past default experience.

l',i'
Cash and cash equivalents

The LGU limits its exposure to credit risk by investing cash and cash equivalents with
only reputable financial institutions that have a sound credit rating, and within specific
guidelines set in accordance with the Sanggunian's approved investment policy.
Consequently, the LGU does not consider there to be any significant exposure to credit
risk.

Liquidity risk

Liquidity risk is the risk of the LGU not being able to meet its obligations as they fall
due. The LGU's approach to managing liquidity risk is to ensure that sufficient liquidity

ri'bng dmnage to the LGU''l"-"(


is available to meet its liabilities when due, without incurring unacceptable losses or

17
The following are contractual liabilities of which interest is included in borrowings:

201X 0 &, >3 3-12 1-5 > 5


demand months months vears :years Total
Liabilities ....
Borrowings XXX XXX XXX
Payables XXX XXX XXX XXX
Total Liabilities XXX XXX XXX XXX XXX

2014 On >3 3-12 1-5 > 5


demand months months years years Total
Liabilities
Borrowings XXX XXX XXX
Finance Lease
ObligatioR XXX XXX XXX
Payables XXX XXX XXX XXX
Total Liabilities XXX XXX XXX XXX XXX

Capital management

The primary objective of managing the LGU 's capital is to ensure that there is sufficient
cash available to support the LGU 's funding requirements, including capital expenditure,
to ensure that the LGU remains financially sound. The LGU monitors capital using a
gearing ratio, which is net debt, divided by total capital, plus net debt. In a capital
intensive industry, a gearing ratio of 54.5% or less can be considered reasonable.
Included in net debt are interest bearing loans and borrowings, payables, less
investments.

Currency risk

The LGU is exposed to foreign-currency risk through the importation of goods and
services, either directly or indirectly, through the award of contracts to local importers.
The LGU manages any material direct exposure to foreign-currency risk by entering into
forward exchange cont1aets. The LGU manages its indirect exposure by requiring the
local importer to take ,R)If'fyftrrward exchange contract at the time of procurement, in
order to predetermine t~lfeso value of the contracted goods or services. The LGU was
not a direct party to any outstanding forward exchange contracts at the reporting date.
The movement in the currency was not material to the Group 's procurement.
Market risk

Market risk is the risk of changes in market prices, such as foreign-exchange rates and
interest rates, affecting the LGU 's income or the value of its financial instrument
holdings. The objective of market risk management is to manage and control market risk
exposures within acceptable parameters, while optimizing the return on the risk. The
weighted average interest rates and maturity profile on financial instruments as at 3 I
December 20 IX are as follows:

Weighted
Average I year 1-5 5
Total
Interest or Jess years years
Rate
Financial assets
Investments X XXX XXX XXX
Cash and cash equivalent X XXX XXX
Total financial assets XXX XXX XXX
Financial liabili ties
Borrowings X XXX XXX XXX XXX
Total financial liabilities XXX XXX XXX XXX

Note 4. Cash and Cash Equivalents

201X 201X
Cash on Hand
Cash- Local Treasury XXX XXX
Petty Cash XXX XXX
Cash in B.ank- Local Currency
Cash in BanK- Local C urrency-Current Account XXX XXX
Cash in Bank- Local Currency- Sav ings Account XXX XXX
Cash in Bank- Foreign Currency
Cash in Bank-FQ.reign Currency-Current Account XXX XXX
Cash in Bank - Foreign Currency- Savings Account XXX XXX
Cash Equivalents
Treasury Bills XXX XXX
Total Cash and Cash Equivalent XXX XXX

Cash in banks earns interest based on the prevailing bank deposit rates. Short-term deposits are
made for varying periods, depending on the immediate cash requirements of the LGU and earn
interest at the respective short-term deposit rate. The LGU bank balances amounting to P xxx
include an amo unt of P xxx million which must be used on infrastructure projects.

Note 5- Investment

2015
Investments in Time Deposits
Cash in Bank - Local Currency, Time Deposits XXX
Cash in Bank- Foreign currency, Time Deposits XXX
Treasury Bills XXX
Financial Assets at Fair V~l~eThro gh Surplus or Deficit
Financial assets Held r g XXX
Financial assets Desig at Fair Value Through Surplus or
Deficit XXX
Financial Assets Held to Maturity
Investment in Treasury Bills- Local XXX
Allowance for Impairment (xxx)
Investment in Bonds - Local XXX
Allowance for Impairment (xxx)
Financial Assets- Available for Sale
Investment in Stocks XXX
Allowance for Impairment (xxx)
Investment in Bonds XXX
Allowance for Impairment (xxx)
Financial Assets - Others
Deposits on Letters of Credit XXX
Allowance for Impairment (xx;r)
Guarantee Deposits XXX
Allowance for Impairment (xxx)
Other Investment XXX

r
Allowance for Impairment (xxx)
Investment in Joint Venture

19
Investment in Joint Venture XXX
Allowance for Impairment (txx)
Sinking Fund XXX
Total XXX
....
The reconciliation and fair value of current investments as of December 31 , 20 IX are as follows:

Carrying Fair
amount Value
Financial Assets at Fair Value Through Surplus or Deficit

Publicly traded government bonds :


Balance as of January I, 20 I X XXX XXX
Additional investments made XXX XXX
Fair value increase XXX XXX
Balance as of December 3 I, 20 l X XXX XXX
Additional investment made XXX XXX
Fair value increase XXX XXX
Balance as of December 31 , 20 l X XXX XXX

Held to maturity financial instruments


Fixed deposits :
Balance as of January I, 20 l X XXX XXX
Additional investments made XXX XXX
Interest capitalized XXX XXX
Balance as of December 31 , 201 X XXX XXX
XXX XXX
XXX XXX
XXX XXX

non-cu\Aft~r\lestments as of December 31 , 2015 are as


The reconciliation and fair value of
follows: "'{ 1r. . -
Carrying Fair
amount Value
Financial Assets at Fair Value Through Surplus or Deficit

Publicly traded government bonds :


Balance as of January l , 20 I X
Additional investments made
Fair value increase
Balance as of December 3 I, 20 I X
Additional investment made XXX XXX
Fair value increase XXX XXX
Balance as of December 31, 20JX XXX XXX

Held to maturity financial instruments


Fixed deposits:
Balance as of January I, 20 I X
Additional investments made
Interest capitalized
Balance as of December 3 I, 20 1X XXX XXX

r 20
Additional investments made XXX XXX
Interest capitalized XXX XXX

-
Balance as of December 31, 20 l X XXX XXX

2015 2014

Total cuJTent investments XXX XXX


Total non-cuJTent investments XXX XXX
Total investments XXX XXX

Note 6 - Receivables

Loans and Receivable Accounts 2015


Accounts Receivable XXX
Allowancefor Impairment (xxx) XXX
Real Property Tax Receivable XXX
Allo-wance for Impairment (xxx) XXX
Special Education Tax Receivable XXX
Allowance for Impairment (xxx) XXX
Notes Receivable XXX
Allowance for Impairment (xxx) XXX
Loans Receivable-GOCC XXX
Allowance for Impairment (xxx) XXX
Loans Receivable- LGU XXX
Allowance for Impairment (xxx) XXX
Interest Receivable XXX
Allowance for Impairment (xxx) XXX
Dividends Receivable XXX
Allowance for Impairment (xxx) XXX
Loans Receivable - Others XXX
Allowance for Impairm ent (xxx) XXX
Total !!!

2015
Operating LIN""'' ~ XXX
Allowance} r 1pairment (xxx) XXX
Finance Lease Receivable XXX
Allowance for Impairment (xxx) XXX
Total XXX

Inter-Agency Receivables 2015


Due from National Government Agencies XXX
Allowance for Impairment (xxx) XXX
Due from Government Owned and XXX
Controlled Corporation
Allowance for Impairment (ux) XXX
Due from Local Government Units XXX
Allowance for Impairment (xxx) XXX
Due from Joint Ventures XXX
Allowance for Impairment (xxx) XXX
Total XXX

r 21
Transfers from other government agencies represent those funds received for specific projects
undertaken by the LGU for specific purpose. These funds were received on the basis of the
project budgets submitted. Ac ~rdingly, the LGU is contractually bound to spend these funds
only in connection with the projects. Furthermore, the contracts stipulate that the funds
received for the project may only be applied to the costs incurred for the project, as and when
the phases of the project are certified as complete. The conditions remaining therefore
represent ' phases of the projects that are yet to be certified as complete. Returned of the
unspent portion of the fund is subject to the conditions stated in the respective Memorandum
of-Agreements executed between the LGU and the proponent government agencies.

I ntra-AgencrReceivables 2015
Due from Other Funds XXX
Due from Special Accounts XXX
Due from Local Economic Enterprise XXX
To~l !!!

Advances 2015
Advances for Operating Expenses XXX
Advances for Payroll XXX
Advances to Special Disbursing Officer XXX
Advances for Officers and Employees XXX
Total !!!

Other Receivables 2015


Receivables - Disallowances and Charges XXX
Allowance for Impairment (~ XXX
Due from Officers and Employees XXX
Allowance for Impairment (~ XXX
Due from Non-Government Organizations/ XXX
Peoples Organization
Allowancefor (~ XXX
Other Receiva XXX
Allowance for Im (~ XXX
Total XXX

As of December 31, 2015, loans receivables of P xxx was impaired and fully provided for.

Reconciliation of allowance for impairment of receivables

Non-
Current
Current Total
Receivables
Receivables
Balance- January 1, 201X XXX XXX XXX
Charge for the year XXX XXX XXX
Utilized (xx) (xxx) (xxx)
Unused amount reversed XXX XXX
Discount rate adjustment XXX XXX
Balance- December 31, 201X XXX XXX XXX
Charge for the year XXX XXX
Utilized (xxx) (xx) (xxx)
Unused amount reversed (xx) (xx)
Balance -December 31, 201X XXX XXX XXX

r 22
As at 3 1 December 20 IX , the ageing analysis of current exchange receivables is as fo llows:

Neither Past due hut not impaired


- Total
past due
or
impaired
<30
days
30-60
days
>60
days
Accounts Receivab le XXX XXX XXX XXX XXX
Real Property Tax Receivable XXX XXX XXX XXX XXX
Special Educat ion Tax Receivable XXX XXX XXX XXX XXX
Notes Receivable XXX XXX XXX XXX XXX
Loans Receivable-OOCC XXX XXX XXX XXX XXX
Loans Receivable-LOU XXX XXX XXX XXX XXX
Interest Receivable XXX XXX XXX XXX XXX
Dividends Recei.vabie XXX XXX XXX XXX XXX
Loans Receivables -Others XXX XXX XXX XXX XXX
Operatin g Lease Receivables XXX XXX XXX XXX XXX
Fi nance Lease Receivables XXX XXX XXX XXX XXX
Due from NO As " XXX XXX XXX XXX XXX
Due from OOCCs XXX XXX XXX XXX XXX
Due from LOUs XXX XXX XXX XXX XXX
Due from Joint Venture XXX XXX XXX XXX XXX
Receivables - Disallowances/ XXX XXX XXX XXX XXX
Charges
Due from Officers and Employees XXX XXX XXX XXX XXX
Due from NOOs/POs XXX XXX XXX XXX XXX
Other Receivables JG<X XXX XXX XXX XXX
Total XXX XXX XXX XXX XXX

As at December 3 I, 20 I X

Neither Past due but not impaired


past due
Total <30 30-60 >60
or
days days days
impaired
Accounts Receivable . XXX XXX XXX XXX XXX
Real Property Tax Receivab le ~
XXX XXX XXX XXX XXX
Special Education Tax RecJI\'M!Ie / v XXX XXX XXX XXX XXX
Notes Receivable nr I
XXX XXX XXX XXX XXX
Loans Receivable-GOCC XXX XXX XXX XXX XXX
Loans Receivable-LOU XXX XXX XXX XXX XXX
Interest Receivable X,XX XXX XXX XXX XXX
Dividends Receivable XXX XXX XXX XXX XXX
Loans Receivables -Others XXX XXX XXX XXX XXX
Operating Lease Receivables XXX XXX XXX XXX XXX
Finance Lease Receivables XXX XXX XXX XXX XXX
Due from NO As XXX XXX XXX XXX XXX
Due from OOCCs
Oue from LOUs
.. XXX
XXX
XXX
XXX
XXX
XXX
XXX
XXX
XXX
XXX
Due from Joint Venture XXX XXX XXX XXX XXX
Receivables - Disallowances/ XXX XXX XXX XXX XXX
Charges
Due fro m Officers and Emp loyees XXX XXX XXX XXX XXX
Due from NGOs/POs XXX XXX XXX XXX XXX
Other Receivables XXX XXX XXX XXX XXX
Total XXX XXX XXX XXX XXX

23
Note 7- Inventories

Inventory Held for Sale


Merchandise Inventory XXX
Inventory Held for Distribution
Food Supplies for Distribution XXX
Welfare Goods for Distribution XXX
Drugs and Medicines for Distribution XXX
Medical, Dental and Laboratory Supplies for Distribution XXX
Agricultural and Marine Supplies for Distribution XXX
Agricultural Produce for Distribution XXX
Textbook:s and Instructional Materials for Distribution XXX
Construction Materials for Distribution xxx
Property and Equipment for Distribution xxx
Other Supplies and Materials for Distribution xxx
Inventory Heldfor Manufacturing
Raw Materials Inventory xxx
Work-in-Process Inventory xxx
Finished Goods Inventory xxx
Inventory Held.for Consumption
Office Supplies Inventory xxx
Accountable Forms, Plates and Stickers xxx
Non-Accountable Forms Inventory xxx
Animal/Zoological Supplies Inventory xxx
Food Supplies Inventory xxx
Drugs and Medicines Inventory xxx
Medical, Dental and Laboratory Supplies Inventory xxx
Fuel, Oil and Lubricants Inventory xxx
Agricultural and Marine Supplies Inventory xxx
Textbooks and Instructional Materials Inventory xxx
Military, Police and Traffic Supplies Inventory xxx
Chemical and Filtering S~pplies Inventory xxx
Construction Materials lnv~entory xxx
Other Supplies and Materi l ve ry xxx
Total !X!

At December 31 , 201X, Pxx million (201X: Pxx million) of total inventory was carried at fair
value less cost to sell.

The amount of write-down of inventories recognized as an expense is Pxx million (2014: Pxx
million), which is recognized in the corresponding inventory expense account.

No inventory items were pledge as security during the current or prior financial year.

Note 8- Investment property

20lX 20tX

Investment Property -Land XXX XXX


Investment Property-Building XXX XXX
Acquired Assets XXX XXX
Foreclosed Property XXX XXX
Forfeited Prope1ty/assets XXX XXX

I
24
Confiscated Property/ Assets XXX XXX
Abandoned Property/assets XXX XXX
Total XXX XXX

Reconciliation of Investment Property


201X 201X

Beginning Balance XXX XXX


Additions XXX XXX
Depreciation XXX XXX
Ending Bal~ce XXX XXX

Rental revenue from investment property XXX XXX

Direct operating expenses including repairs and


maintenance arising from investment property that
generated rental revenue during the period XXX XXX

Direct operating expenses including repairs and


maintenance that did not generate rental revenue during
the year XXX XXX

The fair value of investment properties carried at cost amounted to Pxxx million (20IX: P
xxx million). The fair values were determined based on valuations performed by Juan dela
Cruz Chartered Surveyors and Appraisals, accredited independent appraiser as at December
31, 201X.

Note 9 - Property, Plant and Equipment

(see attached sheet)

The transfer and adjustment column relates to reclassifications between the different classes of
assets and also to other categories of assets including inventory and intangible assets.

The LGU measured the residual value of all items o property, plant and equipment, but does not
expect a residual value of these assets, ese wiJI be utilized for their entire economic
lives and do not have a significant scr alue. During the current financial year, the LGU
reviewed the estimated useful lives and resiaual values of property, plant and equipment, where
appropriate .

Fully depreciated assets at an original cost of Pxxx million (20 I X: P xx million) are still in use
and which the LG U plan to donate to non-profit organizations in the ensuing years .

Note 10- Biological Assets


w
2015
Breeding Stocks XXX
Livestock XXX
Trees, Plant and Crops XXX
Aquaculture XXX
Other Bearer Biological Assets XXX
Total !!!

25

I
- - - - - - - - - - - -- - -

The above balances are stated in net recoverable value. Write downs were treated as expense in
the current year.

Note 11 - Liabilities

Financial Liabilities 2015

Accounts Payable XXX


Due to Officers and Employees XXX
Notes Payable XXX
Interest Payabte XXX
Operating Lease Payable XXX
Finance Lease Payable XXX
Awards and Rew~:ds Payable XXX
Other Payables XXX
Bonds Payable XXX
Discount on Bonds Payable- Domestic (xxx)
Premium on Bonds Payable- Domestic (.x.xx)
Bonds Payable- Foreign XXX
Discount on Bonds Payable-Foreign (.x.xx)
Premium on Bonds Payable- Foreign (.x.xx)
Loans Payable- Domestic XXX
Loans Payable- Foreign XXX
Total XXX

Trade payables are non-interest bearing and are normally settled on 60-days terms. Other
payables are non-interest bearing and have an average term of six months. Interest payable is
normally settled quarterly throughout the financial year.

Inter-Agency Payables 2015

Due to BIR XXX


Due to GSIS XXX
Due to Pag-IBIG XXX
Due to Phil Health XXX
Due to NGAs XXX
Duot~o
Duet s
XXX
XXX
Due to o nt Venture XXX
Total XXX

The first four accounts represents the amount deducted from the salaries of officials and
employees and is remitted to the respective government agencies immediately on the month
following the month for which these were deducted. While the remaining accounts represents
balances of funds received by the LGU for specific purposes.

Trust Liabilities 2015


_
...,,

Trust Liabilities XXX


Trust Liabilities - Disaster Risk Reduction and XXX
Management Fund
Bail Bonds Payable XXX
Guarantee/Security/Deposits Payable XXX

( 26
Customers' Deposits Payable
Total

Deferred Credits/Uneurned Income


Deferred Credits
Deferred Real Property Tax XXX
Deferred Special Educatiorr Tax XXX
Deferred Finance Lease Revenue XXX
Deferred Service Concession Revenue XXX
Unearned revenue-Investment Property XXX
Other Deferred Credits XXX
Unearned. Re~enue- Investment Property XXX
Other Unearned Revenue XXX
Total !!!

Note 12 - Provisions

Provisions
Termination Benefits XXX
Other Provisions XXX
Total !!!

Note 13- Other Payables

Other Payables
Total

Note 14- Tax Revenue

2015
Tax Revenue -Individual and Corporation
Professional Tax XXX
Community tax XXX
Tax Revenul!'-Propt:rty
Real Prope XXX
Discount XXX
Special E' Jon Tax XXX
Discount on Special Education Tax XXX
Special Levy on Idle Lands XXX
Special Levy on Lands Benefited by Public Works XXX
Projects
Real Property Transfer Tax XXX
Tax Revenue-Goods and Services
Business Tax XXX
Tax on Sand, Gravel and Other Quarry XXX
Tax on Delivery trucks and Vans XXX
Amusement Tax XXX
Franchise Tax XXX
Printing and Publication Tax XXX

r 27
Tax Revenue-Others
Other Taxes XXX
Tax Revenue- Fines and Pe!J.alties
Tax Revenue- Fines and Penalties Taxes on XXX
Individual<'and Corporations
Tax Revenue- Fines and Penalties-Property Taxes XXX
Tax Revenue -Fines and Penalties- Taxes on Goods XXX
and Services
Tax revenue -Fines and Penalties - Other Taxes XXX
Share from National Taxes
Share Internal Revenue Collection XXX
S~are from Expanded Value Added Tax XXX
Share fr1Jm National Wealth XXX
Share from Tobacco Excise Tax XXX
Share from Economic Zone XXX
Total !.!..!

Note 15- Service and Business Income

2015
Service Income
Permit Fees XXX
Registration Fees XXX
Registration Plates, Tags and Sticker Fees
Clearance and Certificate Fees XXX
Supervision and Regulation Enforcement Fees XXX
Inspection Fees XXX
Verification and Authentication Fees XXX
Processing Fees XXX
Occupation Fees XXX
Fishery Rental Fees XXX
Fees for Sealing and Licensing of Weights and XXX
Measures
Fines and Penalties-Service Income XXX
Other Service Income XXX
Business Income
School Fees XXX
Affiliation Fees XXX
Seminar/Training Fees XXX
Rent/Lease Income XXX
Communication Network Fees XXX
Transportatioo System Fees XXX
Road Network Fee XXX
Waterworks S XXX
Power Supply S XXX
System Fees XXX
Parking Fees XXX
Receipts from Operation of Hostels/Dormitories and XXX
Other
Receipt from Market Operations XXX
Slaughterhouse Operation XXX
Receipt from Cemetery Operations XXX
Income from Printing and Publication XXX
Sales Revenue XXX
Sales Discounts XXX

28

{
Garbage Fees XXX
Hospital Fees XXX
Dividend Income XXX
Interest Income XXX
Service ConcessiOn Revenue XXX
Other Service Concession Revenue XXX
Lea!le Revenue XXX
Share in the Profit of Joint Venture XXX
Fines and Penalties - Business Income XXX
Other Business Income XXX
Total !!!

Note 16- Transfers, Assistance and Subsidy

Assistance and Subsidy


Subsidy from National Government XXX
Assistance from Local Government Units XXX
Assistance from Government-Owned and/or Controlled XXX
Corporations
Subsidy from Other Funds XXX
Subsidy from General fund Proper/Other Special Accounts XXX
Subsidy from Other Local Economic Enterprise XXX
Transfers
Transfers from General Fund as Project Equity Share XXX
Transfers from General Fund of Unspent DRRMF XXX
Total !!!

Note 17- Share, Grants and Donation

Share
Share from PAGCOR XXX
Share from PCSO XXX
Grants and Donation
Grants and Donatiohs in Cash XXX
Grants and Do~ sin d XXX
Grants from C ary loans XXX
Total .. XXX

Note 18- Gains

2015
Gains
Gain from changes in Fair Value of Financial Instruments XXX
Gain on Foreign Exchange (FOREX) XXX
Gain on sale of Investments XXX
Gain on sale oflnvestment Property XXX
Gain on sale of Property, Plant and Equipment XXX
Gain on initial recognition of Biological Assets XXX
Gain on sale of Biological Assets XXX

r 29
Gain from changes in Fair Value less Cost to Sell of XXX
Biological Assets due to Physical Change
Gain from changes in Fair .J.:alue less Cost to Sell of XXX
Biological Assets due to Price Change
Gain on Sale of Agricultural Produce XXX
Gain on Sale of Intangible Assets XXX
Other Gains XXX
Total !!!

Note 19 -Employee Costs

Personnel Services
Salaries and Wages- Regular XXX
Salaries and \Yages- Casual/Contractual XXX
Other Compensation XXX
Personal Economic Relief allowance XXX
Representation Allowance XXX
Transportation Allowance XXX
Clothing/Unifonn Allowance XXX
Subsistence Allowance XXX
Laundry Allowance XXX
Quarters Allowance XXX
Productivity Incentive Allowance XXX
Overseas Allowance XXX
Honoraria XXX
Hazard Pay XXX
Longevity Pay XXX
Overtime and Night Pay XXX
Year-End Bonus XXX
Cash Gift XXX
Other Bonuses and Allowances XXX
Personnel Benefit Contribution
Retirement and Life Insurance Premiums XXX
Pag-IBIG Contribution XXX
Phi!Health Contribution XXX
Employees Compensation Insurance Premiums XXX
Provident/Welfare fund Contributions XXX
Other Personnel Benefit
Pension Benefit XXX
Retirement Gratuity XXX
Terminal Le XXX
Other Person XXX
Total XXX

Note 20- Maintenance and Other Operating expenses

2015
Traveling Expenses
Traveling Expenses- Local XXX
Traveling Expenses- Foreign XXX
Training and Scholarship Expenses
Training Expenses XXX
Scho Iarsh ip/Grants/Expenses XXX

30

(
Supplies and Material Expenses
Office Supplies Expense XXX
Accountable Forms Expense XXX
Non-Accountable Forms Expenses XXX
Animal/Zoological ~penses XXX
Food Supplies Expense XXX
Welfare Goods Expenses XXX
Drugs and Medicines Expenses XXX
Medical, Dental and Laboratory Supplies Expenses XXX
Fuel, Oil and Lubricant Expenses XXX
Agriculture and Marine Supplies Expenses XXX
Textbooks and Instructional Materials Expenses XXX
Military, PoJ.ice and Traffic Supplies Expenses XXX
Chemical-and Filtering Supplies Expenses XXX
Other Supplies and Material Expenses XXX
Utility Expenses
Water ExpenseS' XXX
Electricity Expenses XXX
Communication Expenses
Postage and Courier Services XXX
Telephone Expenses XXX
Internet subscription Expenses XXX
Cable, Satellite, Telegraph and Radio Expenses XXX
A wards/Rewards and Prices
A wards/Rewards Expenses XXX
Prizes XXX
Survey, Research, Exploration and Development Expenses
Survey Expenses XXX
Research, Exploration and Development Expenses XXX
Demolition/Relocation and Desilting!Dredging Expenses
Demolition and Relocation Expenses XXX
Desilting and Dredging Expenses XXX
Generation, Transmi.5sion and Distribution Expenses
Generation, Transm ission and Distribution Expenses XXX
Confidential, Intelligence and Extraordinary Expenses
Confidential Expenses XXX
Intelligence Expenses XXX
Extraordinary and Miscellaneous Expenses XXX
Total !!!

Note 21- Contracted Services


.., 2015
\
Profession a
LegalS 1 XXX
Auditing e ces XXX
Consultancy Services XXX
Other Professional Services XXX
General Services
Environmental /Sanitary Services XXX
Janitorial Services XXX
Security services XXX
Other General Services XXX
Total !!!

r 31
Note 22- Repairs and Maintenance

2015
Repairs and Maintenance-Investment Property XXX
Repairs and Maintenaf.lce -Land Improvements XXX
Repairs and Maintenance -Infrastructure Assets XXX
Repairs and Maintenance -Buildings and Other Structure XXX
Repairs and Maintenance -Machinery and Equipment XXX
Repairs and Maintenance -Transportation Equipment XXX
Repairs and Maintenance - Furniture, Fixtures XXX
Repairs and Maintenance -Leased Assets XXX
Repairs and Maintenance -Leased Assets Improvements XXX
Repairs' and Maintenance -Other Property, Plant and
Equipment
Total

Note 23- Financial Assistance/Subsidy

2015
Subsidy to NGAs XXX
Subsidy to Local Government Units XXX
Subsidy to Other Funds XXX
Subsidy to General Fund Proper/Special Accounts XXX
Subsidy to Local Economic Enterprises XXX
Subsidies - Others XXX
Total !!.!

Note 24 - Transfers

2015
Transfers of Unspent Current Year DRRM Funds to the XXX
Trust Funds
Transfers for Project Equity Share
Total

Note 25- Taxes, Insurance Premiums and Other Fees

2015
Taxes, Duties and Licenses XXX
Fidelity Bond Premiums XXX
Insurance Expenses XXX
Total !!.!

Note 26- Other Maintenance and Operating Expenses

2015
Advertising Expense XXX
Printing a ation Expenses XXX
Represe Expenses XXX
Transpo i and Delivery Expenses XXX
Rent/Lease Expenses XXX
Membership Dues and Contributions to Organizations XXX
Subscription Expenses XXX

r 32
Donations XXX
Other Maintenance and Operating Expenses XXX
Total XXX

Note 27- Financial Expenses

2015
Management Supervision/Trusteeship Fees XXX
Interest Expenses
Guarantee Fees XXX
Bank Charges XXX
Comm it;nentl'ees XXX
Other Financial Charges XXX
Total !!!

Note 28 - Direct Expenses

Cost of Goods Manufactured


Direct Materials XXX
Direct Labor XXX
Manufacturing Overhead XXX
Cost of Sales
Cost of Sales
Total

Note 29 -Non-Cash Expenses

Depreciation and Amortization


Depreciation-Investment Property XXX
Depreciation-Land Improvements XXX
Depreciation-Infrastructure Assets XXX
Depreciation-Buildings and Other Structure XXX
Depreciation-Machinery and Equipment XXX
Depreciation-Transportation Equipment XXX
Depreciation-Furniture, Fixtures and Book XXX
Depreciation-Leased Assets XXX
Depreciation~Leased- ssets mprovements XXX
Depreciation-Se~v o ession Assets XXX
Depreciation-Othe perty, Plant and Equipment XXX
Amortization- lntangi le Assets XXX
Total !!!

Note 30- Impairment Loss

2015
Impairment Loss-Financial Assets Held to Maturity XXX
Impairment Loss-Loans and Receivables XXX
lmpainnent Loss-Lease Receivable XXX
Impairment Loss-Investment in GOCCs XXX

r 33
Impairment Loss-Investment in Joint Venture XXX
Impairment Loss-Other Receivables XXX
Impairment Loss-Inventories- XXX
Impairment Loss-Investment Property XXX
Impairment Loss-Property, Plant and Equipment XXX
Impairment Loss-Intangible assets XXX
Total _ .!!.!

In the determination of the amount of the impairment loss, the LGU considered the following
to establish the recoverable amount

a. -, Val'!!!_ in use

The LGU has used the following key assumptions in preparing the cash flow forecast:

201X 201X
Inflation 6% 6%
Growth Rate 6% 6%
Discount Rate 5% 5%

The inflation assumption made was based on forecasted inflation figures prepared by the
Department of Finance and the Central Bank of the Philippines. The growth rate was
based on the long-term average growth rate for services and the public sector in which
the LOU operates.

For cash generating assets the projected cash flow is for a period of three years and was
based on the most reliable information available to management at 31 December 2015 .

The LOU holds both cash-generating and non-cash-generating assets. The impairments
recognized relate only to the cash-generating assets . No impairments were identified on
the non-cash-generating assets.

b. Fair value less cost to sell

The fair value less cost to sell was based on the trade-in/resale value of the assets in the
open market. For the vehicles, land and buildings that were impaired, an active market
exists for the resale of these assets. The fair value less cost to sell was based on the values
attainable from the resale of the assets in the open market. These values take into
consideration .the age and condition of the assets and is supported by past experience in
the resale of vehicles, land and buildings in the open market.

Due to their nature, ther is active market for infrastructure assets, community assets,
plant and equipment. ch, the recoverable amount of these assets is their value in use.

Events that lead to the recognition of impairment losses

As part of the annual assessment of assets, it was noted that the condition and
performance of certain assets deteriorated to such extent that they required greater-than-
anticipated maintenance.

34
Note 31 - Losses

2015
Loss on Foreign Exchange (FOREX) XXX
Loss on Sale of Invest ments XXX
Loss on Sale of Investment Property XXX
Loss on Sale of Property, Plant and Equipment XXX
Loss on Sale of Biological Assets XXX
Loss on Sale of Intangible Assets XXX
Loss on Sale of Assets XXX
Loss on Initial Recognition of Biological Assets XXX
Loss o f-Asse~ XXX
Loss on GU.aranty XXX
Share on Loss in Investments in Associates XXX
Other Losses XXX
Total !!!

Note 32- Reconciliation of Net Cash Flows from Operating Activities

Reconciliation of Net Cash Flows from Operating Activities to Surplusi(Deficit)

(in thousands of currency units) 2015


Surplus/(Deficit) XXX
Non-cash transactions
Depreciation XXX
Amortization of Intangible Assets XXX
Impairment Loss XXX
Increase in payables XXX
(Gains) Losses on Sale ofPPE XXX
(Gains) Losses on Sale of Investments XXX
Increase in current assets (xxx)
Increase in investments due to revaluation (xxx)
Increase in receivables (xxx)

.
Net Cash from Operating Activities
.,
m

Note 33- Reconciliation Statement of Comp~.I:M~udget and Actual and the Statement of
Financial Performance (General F~It'J' ua 0

(see attached sheet)

35
Note 9

Property, Plant and Equipment

January Transfers/ December Transfers/ December


Property, Plant and Equipment Additions Disposals Additions Disposals
1, 201X Adjustments 31, 201X Adjustments 31, 201X
Investment Property, Land and Buildings
Investment Property, Land xxx xxx xxx xxx
Investment Property - Buildings xxx xxx xxx xxx xxx
Construction in Progress-Investment Property, Buildings xxx xxx xxx
Land
Land xxx xxx (xxx) xxx
Land Improvements
Land Improvements xxx xxx xxx xxx
Other Land Improvements xxx xxx xxx xxx
Infrastructure Projects
Road Networks xxx xxx xxx xxx
Flood Control Systems xxx xxx xxx xxx xxx
Sewer Systems xxx xxx xxx
Water Supply Systems xxx xxx xxx
Power Supply Systems xxx xxx xxx
Communications Networks xxx xxx xxx xxx k.

Seaport Systems xxx xxx xxx


Airports System xxx xxx xxx
Parks, Plaza and Monuments xxx xxx xxx
Other Infrastructure Assets xxx xxx xxx xxx
Buildings and other Structures
Buildings xxx , xxx (xxx) xxx xxx
School Buildings xxx xxx (xxx) xxx xxx
Hospitals and Health Centers xxx xxx xxx (xxx) xxx
,
Markets xxx xxx xxx
Slaughterhouses xxx xxx xxx
Hostels and Dormitories xxx xxx xxx
Other Structures xxx xxx (xxx) xxx xxx xxx
Machinery and Equipment
Machinery xxx xxx xxx
Office Equipment xxx xxx (xxx) xxx xxx (xxx) xxx
Information and Communication Technology Equipment xxx xxx xxx xxx
Agriculture and Forestry EqUibmen ' xxx xxx xxx
Marine and Fishery Equipment xxx xxx xxx
Airport Equipment xxx xxx xxx
Communications Equipment xxx xxx xxx xxx
Construction and Heavy Equipment xxx xxx xxx
Disaster Response and Rescue Equipment xxx xxx xxx xxx xxx

Page 1 of (1
Note 9

Property, Plant and Equipment

January Transfers/ December Transfers/ December


Property, Plant and Equipment Additions Disposals Additions Disposals
1, 201X Adjustments 31, 201X Adjustments 31, 201X
Military, Police and Security Equipment ' xxx xxx xxx xxx
Medical Equipment xxx (xxx) xxx xxx xxx
Printing Equipment xxx xxx xxx
Sports Equipment xxx xxx xxx
Technical and Scientific Equipment xxx xxx xxx (xxx) xxx
Other Machinery And Equipment xxx xxx xxx
Transportation Equipment
Motor Vehicles xxx xxx xxx xxx (xxx) xxx
Trains xxx xxx xxx
Aircrafts and Aircrafts Ground Equipment xxx xxx xxx
Watercrafts xxx xxx xxx xxx
Other Transportation Equipment xxx xxx xxx (xxx) xxx
Furniture, Fixtures and Books
Furniture and Fixtures xxx xxx xxx (xxx) xxx
Books xxx xxx xxx xxx
Leased Assets
Leased Assets-Land xxx xxx xxx
Leased Assets-Buildings and Structures xxx xxx xxx xxx
Leased Assets-Machinery and Equipment xxx xxx xxx
Leased Assets-Transportation Equipment xxx xxx xxx
Other Leased Assets xxx xxx xxx
Leased Assets Improvements
Leased Assets Improvements-Land xxx xxx xxx
Leased Assets Improvements-Buildings xxx xxx xxx xxx
Other Leased Assets Improvements xxx xxx xxx
Construction in Progress
Construction in Progress-Land Improvements xxx xxx xxx xxx xxx xxx
Construction in Progress-Infrastructure Assets xxx xxx xxx xxx xxx xxx
Construction in Progress-Buildings and Other Structures xxx xxx xxx xxx xxx

Construction in Progress-Leased Assets xxx xxx xxx xxx xxx


Construction in Progress-Leased Assets Ipproyements xxx xxx xxx xxx xxx
Service Concession Assets
Service Concession Assets xxx xxx xxx
Other Property, Plant and Equipment
Work/Zoo Animals xxx xxx xxx
Other Property, Plant and Equipment xxx xxx xxx
Biological Assets
Breeding Stocks xxx (xxx) xxx xxx (xxx) xxx

Page 2 of if
Note 9

Property, Plant and Equipment

January Transfers/ December Transfers/ December


Property, Plant and Equipment Additions Disposals Additions Dis posals
1, 201X Adjustments 31, 201X Adjustments 31, 201X
Plants and Trees xxx (xxx) xxx xxx xxx
Aquaculture xxx xxx xxx
Other Bearer Biological Assets xxx xxx xxx
Intangible Assets
Patents/Copyrights xxx xxx xxx
Computer Software xxx xxx xxx
Other Intangible Assets xxx xxx xxx
Service Concession Assets
Service Concession Assets-Intangible Assets xxx xxx xxx
Total xxx xxx (xxx) xxx xxx xxx (xxxl xxx xxx

Depreciation and m airment


January 1, 201X December 31, 201X December 31, 201X
Property, Plant and Equipment Net Book Net Boo!,
Depreciation Impairment Depreciation Impairment Disposal Depreciation Impairment Depreciation Impairment Disposal Depreciation Impairment
Value Valise
Investment Property, Land and
Buildings
Investment Property, Land (xxx) (xxx) (xxx) xxx (xxx) (xxx) xxx
Investment Property-Buildings (xxx) (xxx) (xxx) (xxx) (xxx) (xxx) xxx (xxx) (xxx) (xxx) (xxx) XX):

Construction in Progress- xxx xxx


Investment Property, Buildings (xxx) (xxx) (xxx) (xxx) (xxx) (xxx) (xxx) (xxx) (xxx) (xxx)
Land _
Land (xxx) (xxx) (xxx) xxx (xxx) (xxx) xxx
Land Improvements
Land Improvements (xxx) (xxx) (xxx) (xxx) (xxx) (xxx) xxx (xxx) (xxx) (xxx) (xxx) xxx
Other Land Improvements it (Xxx) (xxx) (xxx) (xxx) (xxx) (xxx) xxx (xxx) (xxx) (xxx) (xxx) xxx
Infrastructure Projects
Road Networks x < (xxx) (xxx) (xxx) (xxx) (xxx) xxx (xxx) (xxx) (xxx) (xxx) xxx
Flood Control Systems (xxx) (xxx) (xxx) (xxx) (xxx) (xxx) xxx (xxx) (xxx) (xxx) (xxx) xxx
Sewer Systems (xxx) (xxx) (xxx) (xxx) (xxx) (xxx) xxx (xxx) (xxx) (xxx) (xxx) xxx
Water Supply Systems (xxx) (xxx) (xxx) (xxx) (xxx) (xxx) xxx (xxx) (xxx) (xxx) (xxx) xxx
Power Supply Systems (xxx) (xxx) (xxx) (xxx) (xxx) (xxx) xxx (xxx) (xxx) (xxx) (xxx) xxx
Communications Networks (xxx) (xxx) (xxx) (xxx) (xxx) (xxx) xxx (xxx) (xxx) (xxx) (xxx) xxx

Page 3 of t)
Note 9

January 1, 201X December 31, 201X December 31, 201X


Property, Plant and Equipment Net Book Net Boit
Depreciation Impairment Depreciation Impairment Disposal Depreciation Impairment Depreciation Impairment Disposal Depreciation Impairment
Value Value,

Seaport Systems (xxx) (xxx) (xxx) (xxx) (xxx) (xxx) xxx (xxx) (xxx) (xxx) (xxx) xxx
Airports System (xxx) (xxx) (xxx) (xxx) (xxx) (xxx) xxx (xxx) (xxx) (xxx) (xxx) xxx
Parks, Plaza and Monuments (xxx) (xxx) (xxx) (xxx) (xxx) (xxx) xxx (xxx) (xxx) (xxx) (xxx) xxx
Other Infrastructure Assets (xxx) (xxx) (xxx) (xxx) (xxx) (xxx) xxx (xxx) (xxx) (xxx) (xxx) xxx
Buildings and other Structures
Buildings (xxx) (xxx) (xxx) (xxx) (xxx) (xxx) xxx (xxx) (xxx) (xxx) (xxx) xx,.
School Buildings (xxx) (xxx) (xxx) (xxx) (xxx) (xxx) (xxx) xxx (xxx) (xxx) (xxx) (xxx) xx,
Hospitals and Health Centers (xxx) (xxx) (xxx) (xxx) (xxx) (xxx) xxx (xxx) (xxx) (xxx) (xxx) (xxx) xxx
Markets (xxx) (xxx) (xxx) (xxx) (xxx) (xxx) xxx (xxx) (xxx) (xxx) (xxx) xxx
Slaughterhouses (xxx) (xxx) (xxx) (xxx) (xxx) (xxx) xxx (xxx) (xxx) (xxx) (xxx) xxx
Hostels and Dormitories (xxx) (xxx) (xxx) (xxx) (xxx) (xxx) xxx (xxx) (xxx) (xxx) (xxx) xxx
Other Structures (xxx) (xxx) (xxx) (xxx) (xxx) (xxx) (xxx) xxx (xxx) (xxx) (xxx) (xxx) xxx

Machinery and Equipment


Machinery (xxx) (xxx) (xxx) (xxx) (xxx) (xxx) xxx (xxx) (xxx) (xxx) (xxx) xxx
Office Equipment (xxx) (xxx) (xxx) (xxx) (xxx) (xxx) (xxx) xxx (xxx) (xxx) (xxx) (xxx) (xxx) xxx
Information and Communication xxx xxx
Technology Equipment (xxx) (xxx) (xxx) (xxx) (xxx) (xxx) (xxx) (xxx) (xxx) (xxx)
Agriculture and Forestry (xxx) (xxx) (xxx) (xxx) (xxx) (xxx) xxx (xxx) (xxx) (xxx) (xxx) xxx
Equipment
Marine and Fishery Equipment (xxx) (xxx) (xxx) (xxx) (xxx) (xxx) xxx (xxx) (xxx) (xxx) (xxx) xxx

Airport Equipment (xxx) (xxx) (xxx) (xxx) (xxx) (xxx) xxx (xxx) (xxx) (xxx) (xxx) xxx
(xxx) (xxx) (xxx) (xxx) (xxx) (xxx) xxx (xxx) (xxx) (xxx) (xxx) xxx
Communications Equipment
Construction and Heavy (xxx) (xxx) (xxx) (xxx) (xxx) (xxx) xxx (xxx) (xxx) (xxx) (xxx) xxx
Equipment
Disaster Response and Rescue
Equipment (xxx) (xxx) (xxx) (xxx) (xxx) (xxx) xxx (xxx) (xxx) (xxx) (xxx) xxx
Military, Police and Security
Equipment (xxx) (xxx) (xxx) (xxx) (xxx) (xxx) xxx (xxx) (xxx) (xxx) (xxx) xxx
(xxx) (xxx) (xxx) (xxx) (xxx) (xxx) (xxx) xxx (xxx) (xxx) (xxx) (xxx) xxx
Medical Equipment
(xxx) (xxx) (xxx) (xxx) (xxx) xxx (xxx) (xxx) (xxx) (xxx) xxx
Printing Equipment /I( (xxx)
Sports Equipment (xxx) (xxx) (xxx) (xxx) (xxx) (xxx) xxx (xxx) (xxx) (xxx) (xxx) xxx
Technical and Scientific (xxx) (xxx) (xxx) (xxx) (xxx) (xxx) xxx (xxx) (xxx) (xxx) (xxx) xxx
Equipment (xxx)
Other Machinery And Equipment (xxx) (xxx) (xxx) (xxx) (xxx) (xxx) xxx (xxx) (xxx) (xxx) (xxx) xxx

Page 4 of 6
Note 9

January 1, 201X December 31, 201X December 31, 201X


Property, Plant and Equipment Net Book Net Rook
Depreciation Impairment Depreciation Impairment Disposal Depreciation Impairment Depreciation Impairment Disposal Depreciation Impairment
Value Value

Transportation Equipment
Motor Vehicles (xxx) (xxx) (xxx) (xxx) (xxx) (xxx) xxx (xxx) (xxx) (xxx) (xxx) (xxx) xxx
Trains (xxx) (xxx) (xxx) (xxx) (xxx) (xxx) xxx (xxx) (xxx) (xxx) (xxx) xxx
Aircrafts and Aircrafts Ground
Equipment (xxx) (xxx) (xxx) (xxx) (xxx) (xxx) xxx (xxx) (xxx) (xxx) (xxx) xxx
Watercrafts (xxx) (xxx) (xxx) (xxx) (xxx) (xxx) xxx (xxx) (xxx) (xxx) (xxx) xxx
Other Transportation Equipment (xxx) (xxx) (xxx) (xxx) (xxx) (xxx) xxx (xxx) (xxx) (xxx) (xxx) (xxx) xxx
Furniture, Fixtures and Books
Furniture and Fixtures (xxx) (xxx) (xxx) (xxx) (xxx) (xxx) xxx (xxx) (xxx) (xxx) (xxx) (xxx) xxx

Books (xxx) (xxx) (xxx) (xxx) (xxx) (xxx) xxx (xxx) (xxx) (xxx) (xxx) xxx

Leased Assets
Leased Assets-Land (xxx) (xxx) (xxx) (xxx) xxx (xxx) (xxx) xx);
Leased Assets-Buildings and
Structures (xxx) (xxx) (xxx) (xxx) (xxx) (xxx) xxx (xxx) (xxx) (xxx) (xxx) xx
Leased Assets- Machinery and
Equipment (xxx) (xxx) (xxx) (xxx) (xxx) (xxx) xxx (xxx) (xxx) (xxx) (xxx) xx,
Leased Assets- Transportation
Equipment (xxx) (xxx) (xxx) (xxx) (xxx) (xxx) xxx (xxx) (xxx) (xxx) (xxx) xxx
Other Leased Assets (xxx) (xxx) (xxx) (xxx) (xxx) (xxx) - xxx (xxx) (xxx) (xxx) (xxx) xxx

Leased Assets Improvements


Leased Assets Improvements- (xxx) (xxx) (xxx) (xxx) xxx (xxx) (xxx) (xxx) (xxx) xxx
Land (xxx) (xxx)
Leased Assets Improvements-
Buildings (xxx) (xxx) (xxx) (xxx) (xxx) (xxx) xxx (xxx) (xxx) (xxx) (xxx) xxx
Other Leased Assets (xxx) (xxx) (xxx) (xxx) (xxx) (xxx) xxx (xxx) (xxx) (xxx) (xxx) xxx
Improvements
Service Concession Assets
Service Concession Assets * ' (xxx) (xxx) (xxx) (xxx) (xxx) (xxx) xxx (xxx) (xxx) (xxx) (xxx) xx>,
Other Property, Plant and
Equipment .
Work/Zoo Animals (xxx) (xxx) (xxx) (xxx) (xxx) (xxx) xxx (xxx) (xxx) (xxx) (xxx) xxx
Other Property, Plant and (xxx) (xxx) xxx xxx
Equipment (xxx) (xxx) (xxx) (xxx) (xxx) (xxx) (xxx) (xxx)
Intangible Assets
Patents/Copyrights (xxx)* (xxx) (xxx)* (xxx) (xxx)* (xxx) xxx (xxx)* (xxx) (xxx)* (xxx) xxx

Page 5 of 6
Note 9

January 1, 201X December 31, 201X December 31, 201X


Property, Plant and Equipment Net Book Net Book
Depreciation Impairment Depreciation Impairment Disposal Depreciation Impairment Depreciation Impairment Disposal Depreciation Impairment
Value value

Computer Software (xxx)* (xxx) (xxx)* (xxx) (xxx)* (xxx) xxx (xxx)* (xxx) (xxx)* (xxx) xx;
Other Intangible Assets (xxx)* (xxx) (xxx)* (xxx) (xxx)* (xxx) xxx (xxx)* (xxx) (xxx)* (xxx) xxx
Service Concession Assets
Service Concession Assets-
Intangible Assets (xxx) (xxx) (xxx) (xxx) (xxx) (xxx) xxx (xxx) (xxx) (xxx) (xxx) xxx
Total (xxx) (xxx) (xxx) (xxx) (xxx) (xxx) xxx (xxx) (xxx) (xxx) (xxx) (xxx) xxx
*Amortization

Page 6 of 6
Note 33

Reconciliation between actual amounts on a comparable basis as presented in this


statement and in the Statement of Financial Performance for the Year Ended December
31, 2015
Personal Financial Capital
Income MOOE
Services Expenses .Outlay
xxx xxx xxx xxx xxx
Comparison Statement of Budget and Actual
- - - -
Entity Differences
Basis Differences:
Income not considered budgetary items
Non-cash income xxx - - -
Gain on Sale of Assets
Receipts not considered as income - - -
Sale of capital assets (xxx) - - -
(xxx) - - -
Borrowings
Budgetary items not considered as expenses
Debt Service (Loan Amortization, Retirement of Debt Instruments) - (xxx)
Interest Expenses capitalized (xxx)
- - - (xxx)
Capital Expenditures
Timing Differences: - - -
Prepayments charged to current appropriations - - (xxx)
Unconsumed Inventories charged to current appropriations - - (xxx)
Consumed Inventorifs ancrdeferrel charges charged to prior period appropriations (xxx)
, - -
-
xxx xxx xxx xxx -
Per Statement of Financia rformance