OFFICE OF THE PRESIDENT

NOTES TO FINANCIAL STATEMENTS

For the year ended December 31, 2017

1. General Information/Agency Profile

The financial statements of the Office of the President (OP) were authorized for issue
on February 13, 2018 as shown in the Statement of Management Responsibility for
Financial Statements signed by Rizalina N. Justol, the Deputy Executive Secretary for
Finance and Administration.

The OP was a Department established in April 1897 and mandated to provide the
Presidency with advisory, consultative and related staff support services needed to
address the requirements of the President as Head of the Government and the State.

The Agency’s registered office is located at Malacañang Complex, Jose P. Laurel St.,
San Miguel, Manila.

2. Statement of Compliance and Basis of Preparation of Financial Statements

The financial statements have been prepared in accordance with and comply with the
PPSAS issued by the Commission on Audit per COA Resolution No. 2014-003 dated
January 24, 2014.

The financial statements have been prepared on the basis of historical cost, and are
presented in Philippine Peso, the functional currency of the Philippines, and all values
shown are on its absolute amount. The Statement of Cash Flows is prepared using the
direct method.

3. Summary of Significant Accounting Policies

3.1 Basis of accounting

The financial statements are prepared on an accrual basis in accordance with

the PPSAS.

3.2 Cash and Cash Equivalents

Cash and cash equivalents comprise cash on hand and cash at bank. For the
purpose of the consolidated statement of cash flows, cash and cash equivalents
consist of cash and short-term deposits.

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3.3 Inventories

Inventories are initially recognized at cost and subsequently measured using

the Weighted Average Method and accounted for under the Perpetual
Inventory System.

Inventories are recorded as current assets and when distributed or deployed

for utilization or consumption in the ordinary course of operations of the OP,
their carrying amount is recognized as an expense.

3.4 Property, Plant and Equipment (PPE)

Recognition

An item is recognized as PPE if it meets the characteristics and recognition

criteria as a PPE.

The characteristics of PPE are as follows:

 tangible items;
 are held for use in the production or supply of goods or services, for
rental to others, or for administrative purposes; and
 are expected to be used during more than one reporting period.

An item of PPE is recognized as an asset if:

 it is probable that future economic benefits or service potential

associated with the item will flow to the entity; and
 the cost or fair value of the item can be measured reliably.

Measurement at Recognition

An item recognized as PPE is measured at cost.

A PPE acquired through non-exchange transaction is measured at its fair value

as at the date of acquisition.

The cost of the PPE is the cash price equivalent or, for PPE acquired through
non-exchange transaction its cost is its fair value as at recognition date.

Cost includes the following:

 its purchase price, including import duties and non-refundable

purchase taxes, after deducting trade discounts and rebates;
 expenditure that is directly attributable to the acquisition of the items;
and

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  initial estimate of the costs of dismantling and removing the item and
restoring the site on which it is located, the obligation for which an
entity incurs either when the item is acquired, or as a consequence of
having used the item during a particular period for purposes other than
to produce inventories during that period.

Measurement After Recognition

After recognition, all PPE are stated at cost less accumulated depreciation and
impairment losses.

When significant parts of PPE are required to be replaced at intervals, the OP

recognizes such parts as individual assets with specific useful lives and
depreciates them accordingly. Likewise, when a major repair/replacement is
done, its cost is recognized in the carrying amount of the plant and equipment
as a replacement if the recognition criteria are satisfied. All other repair and
maintenance costs are recognized as expense in surplus or deficit as incurred.

Depreciation

Each part of an item of PPE with a cost that is significant in relation to the
total cost of the item is depreciated separately.

The depreciation charge for each period is recognized as expense unless it is

included in the cost of another asset.

Initial Recognition of Depreciation

Depreciation of an asset begins when it is available for use such as when it is

in the location and condition necessary for it to be capable of operating in the
manner intended by management.

For simplicity and to avoid proportionate computation, the depreciation is for

one month if the PPE is available for use on or before the 15th of the month.
However, if the PPE is available for use after the 15th of the month,
depreciation is for the succeeding month.

Depreciation Method

The straight line method of depreciation shall be adopted unless another

method is more appropriate for agency operation.

Estimated Useful Life

The OP uses the Schedule on the Estimated Useful Life of PPE by

classification prepared by COA.

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 It also uses a residual value of at least five percent of the cost of the PPE.

Impairment

An asset’s carrying amount is written down to its recoverable amount, or

recoverable service amount, if the asset’s carrying amount is greater than its
estimated recoverable service amount.

Derecognition

The OP derecognizes items of PPE and/or any significant part of an asset

upon disposal or when no future economic benefits or service potential is
expected from its continuing use. 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.

3.5 Intangible Assets

Recognition and Measurement

Intangible assets are recognized when the items are identifiable non-monetary
assets without physical substance; it is probable that the expected future
economic benefits or service potential that are attributable to the assets will
flow to the entity; and the cost or fair value of the assets can be measured
reliably.

Intangible assets acquired separately are initially recognized at cost.

If payment for an intangible asset is deferred beyond normal credit terms, its
cost is the cash price equivalent. The difference between this amount and the
total payments is recognized as interest expense over the period of credit
unless it is capitalized in accordance with the capitalization treatment
permitted in PPSAS 5, Borrowing Costs.

Recognition of an Expense

Expenditure on an intangible item shall be recognized as an expense when it is

incurred unless it forms part of the cost of an intangible asset that meets the
recognition criteria of an intangible asset.

Subsequent Measurement

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.

The straight line method is adopted in the amortization of the expected pattern
of consumption of the expected future economic benefits or service potential.

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 The amortization period and the amortization method, for an intangible asset
with a finite useful life, are reviewed at the end of each reporting 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
amortization 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 in 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.

3.6 Changes in accounting policies and estimates

The OP recognizes the effects of changes in accounting policy retrospectively.

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

It recognizes the effects of changes in accounting estimates prospectively by

including in surplus or deficit.

3.7 Budget Information

The annual budget is prepared on a cash basis and is published in the

government website.

As a result of the adoption of the cash basis for budgeting purposes, a separate
Statement of Comparison of Budget and Actual Amounts is presented
showing the basis, timing or entity differences. Explanatory comments are
provided in the notes to the annual financial statements; first, the reasons for
overall growth or decline in the budget are stated, followed by details of
overspending or underspending on line items.

3.8 Events after the Reporting Date

There are no material non-adjusting events and transactions after the reporting
date that would influence the opinion and decision of users taken on the basis
of the financial statements.
3.9 Employee benefits

The employees of OP are members of the Government Service Insurance

System (GSIS), which provides life and retirement insurance coverage.

The OP recognizes the undiscounted amount of short term employee benefits,

like salaries, wages, bonuses, allowance, and others, as expense unless
capitalized, and as a liability after deducting the amount paid.

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 It recognizes expenses for accumulating compensated absences when these
are paid. Unused entitlements that have accumulated at the reporting date are
not recognized as expense. Non-accumulating compensated absences, like
special leave privileges, are not recognized.

3.10 Measurement uncertainty

The preparation of financial statements in conformity with PPSAS, requires

management to make estimates and assumptions that affect the reporting
amounts of assets and liabilities, and disclosure of contingent assets and
liabilities, at the date of the financial statements and the reported amounts of
the revenues and expenses during the period. Items requiring the use of
significant estimates include useful life of assets.

Estimates are based on the best information available at the time of the
preparation of the financial statements and are reviewed annually to reflect
new information as it becomes available. Measurement uncertainty exists in
these financial statements. Actual results could differ from these estimates.

4. Prior Period Errors

The OP has determined that prior period errors are omissions from, and
misstatements in the financial statements for one or more prior periods arising from a
failure to use, or misuse of reliable information that:

a) Was available when financial statements for those periods were authorized for
issue; and

b) Could be reasonably expected to have been obtained and taken into account in
the preparation and presentation of the financial statements.

Such errors include the effects of mathematical mistakes, mistakes in applying

accounting policies, oversights or misinterpretations of facts.

Fundamental errors of prior years and recording of liquidation of prior year’s cash
advances are charged to Accumulated Surplus/(Deficit). Those errors affecting the
current year’s operations are adjusted and charged to current year’s accounts.

As a result, a prior period error shall be corrected by retrospective restatement, except

to the extent that it is impracticable to determine either the period-specific effects or
cumulative effect of the error.

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Balances shown in CY 2016 of the following accounts are restated as a result in the
recording of prior period errors totaling ₽102,465,261.73:

 Cash-Collecting Officer
 Petty Cash
 Cash in Bank-Local Currency, Current Account (LCCA)
 Loans and Receivables
 Due from NGAs
 Due from Officers and Employees
 Other Receivables
 Advances to Officers and Employees
 Accounts Payable
 Due to Officers and Employees
 Tax Refunds Payable
 Due to BIR
 Due to GSIS
 Due to Pag-IBIG
 Due to PhilHealth
 Due to NGAs
 Interest Income
 Share from PAGCOR/PCSO
 Income from Grants and Donations in Cash
 Salaries and Wages-Regular
 Personal Economic Relief Allowance (PERA)
 Representation Allowance (RA)
 Transportation Allowance
 Honoraria
 Overtime and Night Pay
 Year End Bonus
 Cash Gift
 Other Bonuses and Allowances
 Retirement and Life Insurance Premiums
 Pag-IBIG Contributions
 PhilHealth Contributions
 Employees Compensation Insurance Premiums
 Terminal Leave Benefits
 Traveling Expenses-Local
 Traveling Expenses-Foreign
 Training Expenses
 Office Supplies Expenses
 Accountable Forms Expenses
 Food Supplies Expenses
 Fuel, Oil and Lubricants Expenses
 Other Supplies and Material Expenses
 Water Expenses

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  Electricity Expenses
 Postage and Courier Services
 Telephone Expenses
 Internet Subscription Expenses
 Extraordinary and Miscellaneous Expenses
 Consultancy Services
 Other Professional Services
 Security Services
 Other General Services
 Repairs and Maintenance-Machinery and Equipment
 Repairs and Maintenance-Transportation Expenses
 Advertising Expenses
 Printing and Publication Expenses
 Representation Expenses
 Transportation and Delivery Expenses
 Rent/Lease Expenses
 Subscription Expenses
 Donations
 Bank Charges
 Depreciation Expenses

5. Cash and Cash Equivalents

Amount (₱)
Account
2017 2016
Cash-Collecting Officer 118,200.78 5,000,638,050.96
Petty Cash 416,833.70 494,309.51
Cash in Bank-Local Currency, Current Account 14,098,481,019.89 7,539,706,060.55
Cash-Treasury/Agency Deposit, Trust 2,010,705,516.14 1,887,996,021.61
Total 16,109,721,570.51 14,428,834,442.63

5.1 Cash in Bank- Local Currency, Current Account consists of the following:

Bank Account Amount (₱)

No. Particulars
2017 2016
3092-1003-40 Payroll Account 31,113,401.25 26,191,679.80
3402-2783-57 Bureau of the Treasury (BTr) 2,164,004.85 -
3092-1003-58 Trust Receipts 401,647,615.41 705,470,557.42
1512-1036-90 President’s Social Fund (PSF) - 6,614,803,347.10
3092-1016-19 PSF 193,401,493.76 193,240,476.23
3092-1014-35 SCPF 13,470,154,504.62 -
Total 14,098,481,019.89 7,539,706,060.55

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 5.2 The PSF was transferred from Presidential Management Staff to OP through
Memorandum Order No. 72 dated October 8, 2014. The PSF was recorded in
the Trust Fund.

6. Receivables

All receivables are classified as current.

Amount (₱)
Account
2017 2016
Loans and Receivable Accounts 13,951,680.27 48,759,957.82
Accounts Receivable 13,951,680.27 48,759,957.82
Inter-Agency Receivables 591,868,578.46 609,922,164.08
Due from National Government 463,801,895.60 481,731,185.94
Agencies
Due from Government-Owned and/or 30,148,467.14 30,148,467.14
Controlled Corporations (GOCCs)
Due from Local Government Units 97,918,215.72 98,042,511.00
Other Receivables 292,780,349.00 290,490,857.73
Receivables-Disallowances/Charges 573,183.81 573,183.81
Due from Officers and Employees 1,598,705.59 1,092,446.74
Due from Non-Government 24,562,301.91 24,562,301.91
Organizations/People’s Organizations
(NGOs/POs)
Other Receivables 266,046,157.69 264,262,925.27
Total 898,600,607.73 949,172,979.63

7. Inventories

Amount (₱)
Particulars
2017 2016
Office Supplies Inventory
Carrying Amount, January 1 3,142,758.98 7,855,268.50
Additions/Acquisitions 8,652,803.73 5,398,133.33
Expensed during the year (9,117,635.88) (9,061,096.06)
Reclassification/Adjustment 88,359.30 (1,049,546.79)
Carrying Amount, December 31 2,766,286.13 3,142,758.98
Fuel, Oil and Lubricants Inventory 444,828.60 444,828.60
Construction Materials Inventory
Carrying Amount, January 1 3,401,319.09 4,427,131.25
Additions/Acquisitions 9,343,191.37 4,215,362.10
Expensed during the year (6,142,049.99) (5,241,174.26)
Reclassification/Adjustment (7,500.00) -
Carrying Amount, December 31 6,594,960.47 3,401,319.09

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 Amount (₱)
Particulars
2017 2016
Other Supplies and Materials Inventory
Carrying Amount, January 1 10,926,227.63 5,633,714.65
Additions/Acquisitions 13,282,059.60 8,631,444.84
Expensed during the year (6,799,323.94) (6,265,483.43)
Reclassification/Adjustment 118,535.08 2,926,551.57
Carrying Amount, December 31 17,527,498.37 10,926,227.63
Semi-Expendable Printing Equipment
Carrying Amount, January 1 - -
Additions/Acquisitions 51,300.00 -
Expensed during the year (40,500.00) -
Carrying Amount, December 31 10,800.00 -
Semi-Expendable Other Machinery and Equipment
Carrying Amount, January 1 - -
Additions/Acquisitions 576,343.95 -
Expensed during the year (395,743.95) -
Carrying Amount, December 31 180,600.00 -
Total Carrying Amount, December 31 27,524,973.57 17,915,134.30

7.1 Supplies Inventory purchased during ASEAN Summit are not yet included in
the said account until completion of final physical inventories.

8. Property, Plant and Equipment

Buildings and Machinery

Other Land Infrastructure Transportation Furniture and
Land Other and Construction
Particulars Improvements Asset Equipment Fixtures Other PPE Total
Structures Equipment in Progress
Carrying Amount,
January 1, 2017 1,725,456,771.37 10,024,599.48 45,550,713.74 228,898,540.00 151,889,696.55 90,149,470.86 39,589,825.72 16,900,939.13 19,221,665.12 2,327,682,221.97
Additions/Acquisitions - - - 2,835,872.40 67,910,223.84 27,420,500.00 6,144,046.73 3,928,824.66 9,875,034.00 118,114,501.63
Total 1,725,456,771.37 10,024,599.48 45,550,713.74 231,734,412.40 219,799,920.39 117,569,970.86 45,733,872.45 20,829,763.79 29,096,699.12 2,445,796,723.60
Disposals - - - - (2,931,886.51) (114,500.00) (363,844.17) (221,304.26) - (3,631,534.94)
Depreciation - - (2,180,924.52) (12,602,298.09) (28,024,851.24) (27,026,254.16) (3,399,530.38) (3,242,350.44) - (76,476,208.83)
Adjustment of the
accumulated
depreciation on
reclassification and
disposal - (13,453,175.01)
- (3,491,904.05) (84,947,019.39) (15,056,593.52) (4,974,529.20) (1,831,508.15) (358,448.18) (124,113,177.50)
Carrying Amount,
December 31, 2017 1,729,456,771.37 6,532,695.43 43,369,789.22 134,185,094.92 173,786,589.12 85,454,687.50 40,138,989.75 17,007,660.91 15,643,524.11 2,241,575,802.33

Gross Cost 1,725,456,771.37 13,899,500.18 45,914,201.16 749,473,504.40 416,442,928.27 381,500,123.51 159,094,113.80 47,577,711.30 15,643,524.11 3,555,002,378.10
Less: Accumulated
Depreciation - (7,366,804.75) (2,544,411.94) (615,288,409.48) (242,656,339.15) (296,045,436.01) (118,955,124.05) (30,570,050.39) - (1,313,426,575.77)
Carrying Amount,
December 31, 2017 1,725,456,771.37 6,532,695.43 43,369,789.22 134,185,094.92 173,786,589.12 85,454,687.50 40,138,989.75 17,007,660.91 15,643,524.11 2,241,575,802.33
Useful life - 10 Years 20 Years 10 - 30 years 5 - 10 years 7 years 5 - 10 years 5 Years - -
Residual Value - 5% - 10% 5% 5% - 10% 5% - 10% 5% - 10% 5% - 10% 5% - 10% - -

8.1 Infrastructure Assets are Flood Control Systems transferred without cost from
the Department of Public Works and Highways (DPWH) through invoice
receipt dated July 7, 2016. These consist of the drainage improvement works
and installation of pumps and facilities/appurtenances at Bahay Pangarap and
the Malacañang Compound.

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 8.2 Construction in Progress
Percentage
Particulars Date Started of Amount (₱)
Completion
Construction of Presidential Archives
2/1/2016 40.09 5,768,490.11
Building
1 unit multi-cell cooling tower for the
500TR centralized ACU and 1 6/28/17 100 9,875,034.00
modular chiller with interconnection
Total 15,643,524.11

8.3 Construction of 1 unit multi-cell cooling tower for the 500TR centralized
ACU and 1 modular chiller with interconnection amounting to ₽9,875,034.00
was transferred to Machinery and Equipment account through Journal Entry
Voucher (JEV) No. 2018-01-002222 dated January 4, 2018.

9. Intangible Assets
This consists of computer software. The reconciliation is as follows:

Amount
Particulars
2017 2016
Carrying Amount, January 1 10,208,851.87 10,208,851.87
Additions/Acquisitions - -
Total 10,208,851.87 10,208,851.87
Amortization Expense - -
Carrying Amount, December 31 10,208,851.87 10,208,851.87
Gross Cost 16,909,641.84 16,909,641.84
Less: Accumulated Amortization 6,700,789.97 6,700,789.97
Carrying Amount, December 31 10,208,851.87 10,208,851.87

9.1 This consists of assets reclassified in December 2015 from Information and
Communication Technology Equipment to Computer Software in compliance
with GAM for NGAs.

10. Other Current Assets

Amount (₱)
Account
2017 2016
Advances to Special Disbursing Officer 102,860,827.50 105,000,000.00
Advances to Officers and Employees 8,257,530.91 2,500,587.77
Advances to Contractors 7,337,150.35 2,979,234.25
Other Payments 65,150.00 65,150.00
Deposit on Letters of Credit 618,284.23 -
Guaranty Deposits 5,164,375.00 -
Other Assets 276,422,734.00 277,464,544.26
Total 400,726,051.99 388,009,516.28

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11. Financial Liabilities
All Financial Liabilities are classified under current payables.
Amount (₱)
Account
2017 2016
Accounts Payable 2,595,525,407.36 154,632,827.42
Due to Officers and Employees 14,688,721.18 42,296,726.56
Tax Refunds Payable 364,460.91 2,110,240.87
Total 2,610,578,589.45 194,819,313.11

12. Inter-Agency Payables

All Inter-Agency Payables are classified under current payables.
Amount (₱)
Account
2017 2016
Due to BIR 170,859,443.57 37,665,576.93
Due to GSIS 7,631,812.53 8,056,340.71
Due to Pag-IBIG 420,234.69 402,990.12
Due to PhilHealth 711,719.83 949,825.13
Due to NGAs 426,316,947.98 688,063,197.21
Due to GOCCs 16,623.00 2,158.86
Due to LGUs 316,428.94 316,428.94
Total 606,273,210.54 735,456,517.90

13. Trust Liabilities

Amount (₱)
Account
2017 2016
Bail Bonds Payable 20,595.00 20,595.00
Guaranty/Security Deposits Payable 18,158,075.66 15,239,897.69
Total 18,178,670.66 15,260,492.69

14. Other Payables

The amount of ₽53,184,284.81 is composed mainly of stale PSF checks subject for
replacement and professional fees of ASEAN 2017 consultants.

15. Service and Business Income

Amount (₱)
Account
2017 2016
Fines and Penalties-Service Income - 2,814,081.44
Fines and Penalties-Business Income - 216,890.13
Other Service Income 50,409,235.65 143,304,601.19

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 Amount (₱)
Account
2017 2016
Rent/Lease Income 2,969,244.00 -
Interest Income 1,527,028.01 1,228,199.85
Total 54,905,507.66 147,563,772.61

15.1 Decrease in Other Service Income was due to non-collection of the OP share
from the income and revenue generated by Manila Economic and Cultural
Office (MECO) in its exercise of consular functions for CY 2017.

16. Shares, Grants and Donations

Amount (₱)
Account
2017 2016
Share from PAGCOR/PCSO 6,500,000,000.00 5,000,316,900.00
Income from Grants and Donations in Cash 1,400,000.00 39,314,254.31
Total 6,501,400,000.00 5,039,631,154.31

17. Personnel Services

Amount (₱)
Particulars
2017 2016
Salaries and Wages 516,114,794.06 442,678,600.25
Salaries and Wages-Regular 331,299,959.84 301,996,967.61
Salaries and Wages-Casual/Contractual 184,814,834.22 140,681,632.64
Other Compensation 217,765,585.17 191,889,313.83
Personal Economic Relief Allowance 26,882,983.76 26,418,275.83
Representation Allowance (RA) 20,526,125.00 19,439,858.48
Transportation Allowance (TA ) 13,457,625.00 13,352,375.00
Clothing/Uniform Allowance 5,100,000.00 5,513,420.55
Laundry Allowance 20,994.48 -
Productivity Incentive Allowance 264,000.00 -
Honoraria 1,066,325.02 894,713.60
Overtime and Night Pay 678,638.20 94,013.37
Year End Bonus 43,673,721.30 35,877,357.65
Cash Gift 5,715,750.00 5,519,750.00
Other Bonuses and Allowances 100,379,422.41 84,779,549.35
Personnel Benefit Contributions 58,784,761.66 57,609,266.30
Retirement and Life Insurance Premiums 52,842,011.66 51,697,423.34
Pag-IBIG Contributions 1,246,600.00 1,317,780.70
PhilHealth Contributions 3,461,350.00 3,337,062.26
Employees Compensation Insurance Premiums 1,234,800.00 1,257,000.00
Other Personnel Benefits 23,667,682.65 80,060,444.77
Pension Benefits 520,000.00 288,000.00

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 Amount (₱)
Particulars
2017 2016
Retirement Gratuity 3,002,890.08 2,826,297.60
Terminal Leave Benefits 11,029,992.63 59,858,307.42
Other Personnel Benefits 9,114,799.94 17,087,839.75
Total 816,332,823.54 772,237,625.15
17.1 Increase in Honoraria was due to the payment of Bids and Awards Committee
(BAC) members’ honoraria.
17.2 Increase in Year End Bonus was due to additional plantilla personnel of OP in
CY 2017.
17.3 Other Bonuses and Allowances account includes the Mid-Year Bonus
amounting to ₽36,240,077.00, Performance-Based Bonus (PBB) of
₽21,092,330.66, Productivity Enhancement Incentive (PEI) of ₽5,092,500.00,
Collective Negotiation Agreement (CNA) Incentive for the employees
amounting to ₽27,368,750.00, Anniversary Bonus amounting to
₽10,482,000.00 and other allowances and bonuses totaling ₽103,764.75.

18. Maintenance and Other Operating Expenses (MOOE)

Amount (₱)
Particulars
2017 2016
Traveling Expenses 421,238,317.67 482,975,458.97
Traveling Expenses-Local 68,484,161.51 25,457,211.64
Traveling Expenses-Foreign 352,754,156.16 457,518,247.33
Training and Scholarship Expenses 51,231,618.79 49,050,149.72
Supplies and Materials Expenses 114,131,863.96 72,932,845.24
Office Supplies Expenses 23,728,440.91 10,233,269.70
Accountable Forms Expenses 60,260.00 73,800.00
Food Supplies Expenses 15,990,691.15 14,301,599.46
Drugs and Medicines Expenses 200,402.75 728,262.50
Medical, Dental and Laboratory Supplies
Expenses - 5,000.00
Fuel, Oil and Lubricants Expenses 24,650,305.78 22,973,132.07
Semi-Expendable Machinery and
Equipment Expenses 2,094,881.49 1,036,763.28
Semi-Expendable Furniture, Fixtures and
Books Expenses 2,765,727.64 1,961,063.40
Other Supplies and Materials Expenses 44,641,154.24 21,619,954.83
Utility Expenses 86,913,155.57 80,843,000.62
Water Expenses 21,535,746.84 23,025,333.81
Electricity Expenses 65,377,408.73 57,817,666.81
Communication Expenses 24,015,881.05 15,658,353.75
Postage and Courier Services 173,037.00 71,431.36
Telephone Expenses 14,750,990.76 10,277,835.84

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 Amount (₱)
Particulars
2017 2016
Internet Subscription Expenses 7,721,952.09 4,447,464.09
Cable, Satellite, Telegraph and Radio
Expenses 1,369,901.20 861,622.46
Awards/Rewards and Prizes - 6,857,000.00
Confidential, Intelligence and
Extraordinary Expenses 2,515,042,990.91 715,356,636.35
Confidential Expenses 1,277,500,000.00 365,000,000.00
Intelligence Expenses 1,227,500,000.00 340,000,000.00
Extraordinary and Miscellaneous Expenses 10,042,990.91 10,356,636.35
Professional Services 3,262,958,666.87 40,876,491.78
Legal Services 4,900.00 6,600.00
Auditing Services 26,000.00 -
Consultancy Services 3,092,301,035.16 19,317,565.77
Other Professional Services 170,626,731.71 21,552,326.01
General Services 34,563,344.70 24,516,196.53
Environment/Sanitary Services 5,994.54 -
Janitorial Services 14,504,862.08 10,194,715.36
Security Services 19,780,488.89 13,965,257.12
Other General Services 271,999.19 356,224.05
Repairs and Maintenance 215,862,302.72 80,790,027.38
Land Improvements - 400,923.35
Buildings and Other Structures 24,141,121.34 16,486,310.93
Machinery and Equipment 854,808.37 1,404,595.25
Transportation Equipment 188,104,160.85 59,993,888.58
Furniture and Fixtures 2,584,663.53 1,514,732.27
Semi-Expendable Furniture, Fixture, and
Books 31,000.00
Other PPE 146,548.63 989,577.00
Taxes, Insurance Premiums and Other Fees 30,089,109.52 16,536,050.75
Taxes, Duties and Licenses 12,197,405.19 624,125.04
Fidelity Bond Premiums 797,437.50 483,307.45
Insurance Expenses 17,094,266.83 15,428,618.26
Other MOOE 8,186,095,028.66 769,504,990.29
Advertising Expenses 5,724,787.26 7,199,383.50
Printing and Publication Expenses 6,458,080.89 600,057.31
Representation Expenses 1,593,944,970.23 195,736,412.18
Transportation and Delivery Expenses 55,602.90 132,508.08
Rent/Lease Expenses 1,671,434,989.18 35,072,625.32
Membership Dues and Contributions to
Organizations 3,262,476.00 -
Subscription Expenses 2,877,042.93 2,307,251.53
Donations 4,777,330,154.07 524,983,920.17
Other MOOE 125,006,925.20 3,472,832.20
Total 14,942,142,280.42 2,355,897,201.38

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 18.1 The expenses incurred for CYs 2017 and 2016 under the following accounts
were due to the Philippine hosting of the ASEAN 2017:

 Traveling Expenses-Local
 Office Supplies Expenses
 Other Supplies and Materials Expenses
 Telephone Expenses
 Internet Subscription Expenses
 Consultancy Services
 Other Professional Services
 Representation Expenses
 Rent/Lease Expenses
 Other Maintenance and Operating Expenses

18.2 Increase in Repairs and Maintenance-Building and Other Structures was due
to several repairs made in Mabini Hall such as vinyl tiles on corridors,
comfort rooms, and the upgrading of Presidential Security Group (PSG)
gymnasium.

18.3 The increase in Repairs and Maintenance-Transportation Equipment account

refers to several major repairs of Presidential Airlift Wing’s (PAW) aircrafts.

18.4 Taxes, Duties and Licenses account increased due to payment of importation
dues for the importation of 100 sets infrared night vision goggles, 12 sets
thermal imaging sight, 12 sets thermal imaging night vision goggles, 2 sets
portable x-ray machine and 2 sets guard hammer for CY 2017.

18.5 The increase in Donations was due to increased number of grantees who
received special financial assistance from the SCPF.

19. Non-Cash Expenses

Amount (₱)
Particulars
2017 2016
Depreciation Expenses
Depreciation-Infrastructure Assets 2,180,924.52 363,487.42
Depreciation-Buildings and Other Structures 12,602,298.09 97,146,568.75
Depreciation-Machinery and Equipment 28,024,851.24 44,116,4557.31
Depreciation-Transportation Equipment 27,026,254.16 35,295,405.56
Depreciation-Furniture, Fixtures and Books 3,399,530.38 5,426,843.83
Depreciation-Other PPE 3,242,350.44 4,050,019.05
Total 76,476,208.83 186,398,781.92

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20. Net Financial Assistance/Subsidy
This pertains to Subsidy from National Government account which consists of the
following:
Amount (₱)
Particulars
2017 2016
NCA received from DBM for the Agency’s
operational requirements 16,127,528,625.00 4,196,682,945.27
Add: Constructive Receipt of NCA for TRA 324,905,022.98 242,748,159.07
Sub-total 16,452,433,647.98 4,439,431,104.34
Less: Notice of Transferred Allocation (NTA) to
various Government Offices 89,433,672.00 149,095,668.23
Reversal of unutilized NCA 7,555,484,668.58 92,251,782.04
Subsidy from National Government – Net 8,807,515,307.40 4,198,083,654.07
Less: Financial Assistance/Subsidy to NGAs, LGUs, GOCCs, NGOs/POs
Financial Assistance to NGAs 92,808,527.08 -
Financial Assistance to NGOs/POs 100,000.00 -
Net Financial Assistance/Subsidy 8,714,606,780.32 4,198,083,654.07

21. Other Non-Operating Income

This represents Miscellaneous Income derived from penalties imposed on suppliers
and contractors for the late deliveries amounting to ₽1,634,122.54.

22. Gains
This refers to Gain on Foreign Exchange (ForEx) amounting to ₽1,310,983.72.

23. Losses
Amount (₱)
Account
2017 2016
Loss on ForEx (2,199,678.61) -
Loss on Sale of PPE (3,285,869.64) (435,040.67)
Loss on Sale of Assets (996,010.26) (1,306,863.73)
Total (6,481,558.51) (1,741,904.40)

23.1 Loss on Sale of PPE represents losses on the sale of various unserviceable
properties or CY 2017.

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24. Collection of Income/Revenues
Amount (₱)
Particulars
2016
Collection of Service Income 53,489,479.65 144,608,090.79
Collection of Other Income 6,501,405,370.00 5,000,000,000.00
Total 6,554,894,849.65 5,144,608,090.79

24.1 Collection of Other Income pertains to share in income of PAGCOR

amounting to ₽6,500,000,000.00, donation from Philippine-Chinese
Association, Inc. of ₽1,400,000.00, and refund of travel differential amounting
to ₽5,370.00 that are recorded in the Trust Fund.

25. Collection of Receivables

Collection of Receivables amounting to ₽88,143,301.86 represents mainly the

collection of Economic Support Fund and other OP Creditors like, Palacio del
Gobernador, and others.

26. Trust Receipts

Amount (₱)
Particulars
2017 2016
Receipt of Guaranty Deposits - 6,235,468.85
Receipt of funds for specific purpose 757,356,228.77 710,396,295.00
Total 757,356,228.77 716,631,763.85

26.1 Receipt of funds for specific purpose represents fund transferred for the
hosting of ASEAN 2017 from the Department of Tourism (DOT), Department
of Interior and Local Government (DILG), and Department of Foreign Affairs
(DFA).

27. Adjustments
Amount (₱)
Particulars
2017 2016
Adjustments for cash accounts 54,678,900.00 -
Cancellation of check issued during the year 124,830,209.49 6,658,005.75
Cancellation of Lost/Stale checks issued in PY 8,634,882.57 1,310,000.00
Recording of Unreleased checks at year-end 320,603,707.84 694,770,609.73
Total 508,747,699.90 702,738,615.48

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28. Payment of Expenses

Amount (₱)
Particulars
2017 2016
Personnel Services 826,332,823.54 403,476,741.93
Maintenance and Other Operating Expenses 5,338,215,306.24 820,572,108.89
Financial Expenses 43,569.17 93,690.83
Total 6,164,591,698.95 1,224,142,541.65

28.1 Increase in payment of MOOE was due to the hosting of ASEAN 2017.

29. Grant of Cash Advances

Amount (₱)
Particulars
2017 2016
Foreign Travel 7,174,841.44 5,694,836.85
Local Travel 321,961,560.30 121,996,137.00
Special Purpose 126,427,096.47 110,385,957.31
Confidential and Intelligence 2,500,000,000.00 710,000,000.00
Total 2,955,563,498.21 948,076,931.16

30. Remittance of Personnel Benefit Contribution and Mandatory Deductions

Amount (₱)
Particulars
2017 2016
Remittances to GSIS 130,429,641.50 205,037,589.03
Remittances to Employees Compensation 1,234,800.00 1,250,700.00
Commission
Remittances to Pag-IBIG 11,209,092.62 10,781,258.34
Remittances to PhilHealth 7,816,177.56 7,299,955.16
Other remittances (NHMFC, Provident, 108,766,850.52 -
OPEN, MESLA, MECOOP, SSS)
Total 259,456,562.20 224,369,502.53

31. Grant of Financial Assistance/Subsidy

The amount totaling ₽4,869,944,563.02 represents various financial assistance to

different beneficiaries of the SCPF.

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32. Purchase of Property, Plant and Equipment

Amount (₱)
Particulars
2017 2016
Construction in Progress 8,418,650.40 19,221,665.12
Machinery and Equipment 35,893,511.00 22,627,402.60
Transportation Equipment 22,699,187.52 -
Furniture and Fixtures 4,890,717.37 1,513,920.09
Other PPE 3,622,163.50 1,045,542.00
Advances to Contractors 6,805,740.45 -
Refund of Retention Fee 10,541,953.11 -
Payment of Accounts Payable for the 1,693,322.51 -
construction of PPE
Total 94,565,245.86 44,408,529.81

33. Other Adjustments in Net Assets/Equity

Amount (₱)
Particulars
2017 2016
Prior year’s liquidation of fund transfers (26,198,506.11) -
Liquidation of prior years (54,168,089.93) -
Other Adjustments (326,441.61) 1,113,388,679.37
Total (80,693,037.65) 1,113,388,679.37

34. Statement of Comparison of Budget and Actual Amounts

Budgeted
Actual Amounts Difference
Amounts on
Particulars on Comparable (Final Budget
Comparable
Basis and Actual)
Basis
Personnel Services 897,275,042.00 843,386,679.52 53,888,362.48
Salaries and Wages 630,828,663.85 590,599,621.02 40,229,042.83
Other Compensation 157,502,953.05 152,202,403.35 5,300,549.7
Personnel Benefit
Contributions 50,102,570.10 41,773,229.60 8,329,340.50
Other Personnel Benefits 58,840,855.00 58,811,425.55 29,429.45
MOOE 15,575,744,876.81 7,664,761,366.87 7,910,983,509.94
Traveling Expenses 2,300,212,694.74 474,944,703.17 1,825,267,991.57
Training and Scholarship
Expenses 105,090,406.42 59,731,245.53 45,359,160.89
Supplies and Materials
Expenses 499,507,222.72 83,598,755.98 415,908,466.74
Utility Expenses 147,015,095.62 88,737,385.19 58,277,710.43
Communication Expenses 227,253,802.78 21,013,319.17 206,240,483.61
Survey, Research,
Exploration and 1,140,000.00 - 1,140,000.00

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 Budgeted
Actual Amounts Difference
Amounts on
Particulars on Comparable (Final Budget
Comparable
Basis and Actual)
Basis
Development Expenses
Confidential, Intelligence and
Extraordinary Expenses 2,517,680,764.56 2,510,011,127.27 7,669,637.29
Professional Services 3,463,061,108.07 1,873,440,331.98 1,589,620,776.09
General Services 39,235,785.19 34,907,148.06 4,328,637.13
Repairs and Maintenance 245,600,412.60 107,445,438.82 138,154,973.78
Financial Assistance/Subsidy 61,519,800.00 3,500,000.00 58,019,800.00
Taxes, Insurance Premiums
and Other Fees 39,577,480.40 29,209,342.73 10,368,137.67
Other MOOE 5,928,850,303.71 2,378,222,568.97 3,550,627,734.74
Capital Outlay 274,136,266.11 64,193,777.07 209,942,489.04
Land Improvements 20,000,000.00 - 20,000,000.00
Building and Other Structures 20,000,000.00 551,127.33 19,448,872.67
Machinery and Equipment 54,010,652.89 34,159,165.61 19,851,487.28
Transportation Equipment 106,435,500.00 12,058,000.00 94,377,500.00
Furniture, Fixtures and Books 7,700,809.94 5,948,059.94 1,752,750.00
Other PPE 55,989,303.28 11,477,424.19 44,511,879.09
Intangible Assets 10,000,000.00 - 10,000,000.00

35. Key Management Personnel

The key management personnel of the OP are the Executive Secretary, the Senior
Deputy Executive Secretary and the members of the senior management group which
consist of the: Deputy Executive Secretaries for Finance and Administration, General
and Administration, Legal Affairs, and Internal Audit.

The aggregate remuneration of the key management personnel determined on a

fulltime equivalent basis, are as follows:

Particulars Aggregate
Remuneration
Salaries and Wages 9,379,344.00
Other Compensation 3,386,088.41
Other Personnel Benefits 937,934.40
Extraordinary and Miscellaneous Expenses 1,392,000.00
Total 15,095,366.81

30