KMBI Annual Report 2009

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Kabalikat Para Sa Maunlad na Buhay, Inc. (A Nonstock, Non-Profit Organization) Financial Statements December 31, 2009 and 2008 and Independent Auditorsâ&#x20AC;&#x2122; Report

SyCip Gorres Velayo & Co.

16

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INDEPENDENT AUDITORSâ&#x20AC;&#x2122; REPORT

THE BOARD OF TRUSTEES Kabalikat para sa Maunlad na Buhay, Inc. No. 12 San Francisco Street Karuhatan, Valenzuela City

We have audited the accompanying financial statements of Kabalikat para sa Maunlad na Buhay, Inc. (a nonstock, non profit organization) (the Organization), which comprise the statements of assets, liabilities and fund balance as at December 31, 2009 and 2008, and the statements of comprehensive income, statements of changes in fund balance and the statements of cash flows for the years then ended, and a summary of significant accounting policies and other explanatory notes.

Managementâ&#x20AC;&#x2122;s Responsibility for the Financial Statements

Management is responsible for the preparation and fair presentation of these financial statements in accordance with Philippine Financial Reporting Standards. This responsibility includes: designing, implementing and maintaining internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error; selecting and applying appropriate accounting policies; and making accounting estimates that are reasonable in the circumstances.

Auditorsâ&#x20AC;&#x2122; Responsibility

Our responsibility is to express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with Philippine Standards on Auditing. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditorâ&#x20AC;&#x2122;s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor

'

17

considers internal control relevant to the Organizationâ&#x20AC;&#x2122;s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Organizationâ&#x20AC;&#x2122;s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion

In our opinion, the financial statements present fairly, in all material respects, the financial position of Kabalikat para sa Maunlad na Buhay, Inc. as of December 31, 2009 and 2008, and its financial performance and its cash flows for the years then ended in accordance with Philippine Financial Reporting Standards.

SYCIP GORRES VELAYO & CO.

Francisco Roque A. Lumbres Francisco Roque A Lumbres Partner CPA Certificate No. 65582 SEC Accreditation No. 0963 A Tax Identification No. 102 090 735 PTR No. 2087546, January 4, 2010, Makati City

April 12, 2010

*SGVMC114125* 18

, ( ;

INDEPENDENT AUDITORSâ&#x20AC;&#x2122; REPORT TO ACCOMPANY INCOME TAX RETURN

THE BOARD OF TRUSTEES Kabalikat para sa Maunlad na Buhay, Inc. No. 12 San Franciso Street, Karuhatan Valenzuela City

We have audited the financial statements of Kabalikat para sa Maunlad na Buhay, Inc. (the Organization) for the year ended December 31, 2009, on which we have rendered the attached report dated April 12, 2010.

In compliance with Revenue Regulations V 20, we are stating the following: 1. The taxes paid or accrued by the Organization for the year ended December 31, 2009 are shown in the Schedule of Taxes and Licenses attached to the Annual Income Tax Return.

2. No partner of our Firm is related by consanguinity or affinity to the president or manager of the Organization.

SYCIP GORRES VELAYO & CO.

Francisco Roque A. Lumbres Francisco Roque A Lumbres Partner CPA Certificate No. 65582 SEC Accreditation No. 0963 A Tax Identification No. 102 090 735 PTR No. 2087546, January 4, 2010, Makati City

April 12, 2010

*SGVMC114125* '

19

KABALIKAT PARA SA MAUNLAD NA BUHAY, INC. (A Nonstock, Non Profit Organization)

STATEMENTS OF ASSETS, LIABILITIES AND FUND BALANCE

December 31 2009 2008

ASSETS Current Assets Cash and cash equivalents (Note 6) Financial assets at fair value through profit or loss (Note 7) Loans and receivables net (Note 8) Prepaid expenses and other current assets (Note 9) Total Current Assets

P =143,120,763 385,155 514,405,194 8,975,678 666,886,790

P =203,724,118 302,679 385,401,789 4,367,788 593,796,374

Noncurrent Assets Available for sale investment net (Note 10) Property and equipment net (Note 11) Other assets (Note 12) Total Noncurrent Assets

7,638,405 35,575,491 5,489,392 48,703,288 P =715,590,078

7,638,405 17,029,259 4,375,322 29,042,986 P =622,839,360

LIABILITIES AND FUND BALANCE Current Liabilities Accrued expenses and other payables (Note 13) Current portion of long term debt Capital build up (Note 14) Total Current Liabilities

P =34,839,067 â&#x20AC;&#x201C; 293,744,643 328,583,710

P =16,891,669 10,000,000 228,373,811 255,265,480

Noncurrent Liabilities Pension liability (Note 15)

29,809,231 358,392,941

30,795,458 286,060,938

357,197,137 P =715,590,078

336,778,422 P =622,839,360

Fund Balance

See accompanying Notes to Financial Statements.

*SGVMC114125* 20

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KABALIKAT PARA SA MAUNLAD NA BUHAY, INC. (A Nonstock, Non Profit Organization)

STATEMENTS OF COMPREHENSIVE INCOME

REVENUE Service income (Note 16) Donations and contributions Foreign exchange gain (loss) Others (Note 16)

Years Ended December 31 2009 2008

P =350,815,381 2,215,847 (756,430) 6,897,360 359,172,158

P =300,202,768 2,830,784 2,665,249 7,047,377 312,746,178

EXPENSES Operating expenses (Note 17) Administrative expenses (Note 18)

250,562,648 88,190,795 338,753,443

203,403,190 82,647,963 286,051,153

EXCESS OF REVENUES OVER EXPENSE

OTHER COMPREHENSIVE INCOME

TOTAL COMPREHENSIVE INCOME

20,418,715

â&#x20AC;&#x201C;

P =20,418,715

26,695,025

â&#x20AC;&#x201C;

P =26,695,025

See accompanying Notes to Financial Statements.

*SGVMC114125* '

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KABALIKAT PARA SA MAUNLAD NA BUHAY, INC. (A Nonstock, Non Profit Organization)

STATEMENTS OF CHANGES IN FUND BALANCE

Balance at January 1 Excess of revenue over expenses Balance at December 31

Years Ended December 31 2009 2008 P =336,778,422

P =310,083,397

20,418,715

26,695,025

P =357,197,137

P =336,778,422

See accompanying Notes to Financial Statements.

*SGVMC114125* 22

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KABALIKAT PARA SA MAUNLAD NA BUHAY, INC. (A Nonstock, Non Profit Organization)

STATEMENTS OF CASH FLOWS

CASH FLOWS FROM OPERATING ACTIVITIES Excess of revenue over expenses Adjustments for: Interest income on loans, bank deposits and short term placements (Note 16) Financing cost (Note 17) Provision for credit and impairment losses (Notes 8, 10, 18 and 19) Depreciation and amortization (Note 11) Amortization of software cost (Note 12) Fair value gain (loss) on FVPL Changes in operating assets and liabilities: Decrease (increase) in amounts of: Receivables Prepaid expenses and other current assets Increase (decrease) in amounts of: Accrued expenses and other payables Pension liability Capital build up Net cash used in operations Interest income received Financing cost paid Net cash provided (used in) by operating activities CASH FLOWS FROM INVESTING ACTIVITIES Acquisitions of property and equipment (Note 11) Increase in other assets Acquisitions of software cost (Note 12) Proceeds from sale of property and equipment Net cash used in investing activities

Years Ended December 31 2009 2008

P =20,418,715

P =26,695,025

(306,762,316) 6,462,569

(267,220,682) 7,707,611

17,794,521 9,046,789 283,378 (82,474)

(144,894,768) (4,607,890)

19,337,561 (986,227) 65,370,832 (318,619,310) 304,859,158 (7,852,734) (21,612,886)

(27,622,536) (1,397,448) â&#x20AC;&#x201C; 29,515 (28,990,469)

30,904,204 6,382,967 260,978 15,241

(12,944,104) (633,840)

(5,714,726) 14,625,768 16,231,039 (183,690,519) 265,311,822 (7,360,263) 74,261,040

(7,134,263) (371,607) (196,052) 172,249 (7,529,673)

*SGVMC114125* '

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CASH FLOWS FROM FINANCING ACTIVITIES Payment of notes payable Payments of current and long term debt Net cash used in financing activities NET INCREASE IN CASH AND CASH EQUIVALENTS CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR CASH AND CASH EQUIVALENTS AT END OF YEAR

â&#x20AC;&#x201C; (10,000,000) (10,000,000) (60,603,355)

203,724,118

P =143,120,763

(50,000,000) (320,733) (50,320,733) 16,410,634

187,313,484

P =203,724,118

See accompanying Notes to Financial Statements.

*SGVMC114125* 24

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KABALIKAT PARA SA MAUNLAD NA BUHAY, INC. (A Nonstock, Non Profit Organization)

NOTES TO FINANCIAL STATEMENTS

1. Organizational Information

Kabalikat Para sa Maunlad na Buhay, Inc. (the Organization) is a nonstock, non profit, charitable, educational, cultural and civic services organization, which was organized on November 4, 1986 with the objective of assisting the low income Filipinos in their pursuit for education, culture, civic, physical and economic advancement with the end view that they will become responsible members and assets of society. To attain these objectives, the Organization conducts microfinance operations pursuant to Republic Act 8425, provide nonfinancial services, seminars, lectures and trainings by inviting resource persons who have expertise and knowledge in fields of industry, farming, fishing and other agricultural activities and extends financial assistance at reasonable interest rates to economically active poor people.

On November 26, 2007, the Organization was certified by Philippine Council for nongovernment organization (NGO) certification as a qualified donee institution in accordance with Revenue Regulations No. 13 98 for a period of five years. Being not organized for profit and since no part of its net income inures to the benefit of any private individual or member, the Organization falls under Section 30 (g) of the Tax Reform Act of 1997. Accordingly, income from activities in pursuit of the purpose for which the Organization was organized is exempt from income tax and the filing of income tax return covering such income. Such exemption, however, does not apply to income of whatever kind and character derived from the use of the Organizationâ&#x20AC;&#x2122;s properties, real or personal, or from any of its activities conducted for profit regardless of the dispositions made of such income.

The registered office of the Organization is located at No. 12 San Francisco Street, Karuhatan, Valenzuela City.

*SGVMC114125* '

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2. Summary of Significant Accounting Policies

Basis of Preparation The accompanying financial statements have been prepared on a historical cost basis except for financial assets at fair value through profit or loss (FVPL) and available for sale (AFS) investments which are measured at fair value. The financial statements are presented in Philippine pesos, the Organizationâ&#x20AC;&#x2122;s functional currency.

Statement of Compliance The financial statements of the Organization have been prepared in compliance with Philippine Financial Reporting Standards (PFRS).

Changes in Accounting Policies

The accounting policies adopted are consistent with those of the previous financial year except for the following new and amended standards and Philippine Interpretation which were adopted as of January 1, 2009:

x PAS 1, Presentation of Financial Statements x PFRS 7 Amendments Improving Disclosures about Financial Instruments

Standards or Interpretations that have been adopted and that are deemed to have an impact on the financial statements or performance of the Organization are described below:

Amendments to PAS 1, Presentation of Financial Statements The revised standard separates owner and non owner changes in equity. The statement of changes in equity includes only details of transactions with owners, with non owner changes in equity presented in a reconciliation of each component of equity. In addition, the standard introduces the statement of comprehensive income: it presents all items of recognized income and expense, either in one single statement, or in two linked statements.

The Organization does not report income, however, for compliance with PFRS, the Organization elected to present a single statement.

There are no items of other comprehensive income as of and for the years ending December 31, 2009 and December 31, 2008.

*SGVMC114125* 26

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PFRS 7 Amendments Improving Disclosures about Financial Instruments The amendments to PFRS 7, Financial Instruments: Disclosures, require additional disclosures about fair value measurement and liquidity risk. Fair value measurements related to items recorded at fair value are to be disclosed by source of inputs using a three level fair value hierarchy, by class, for all financial instruments recognized at fair value. In addition, a reconciliation between the beginning and ending balance for level 3 fair value measurements is now required, as well as significant transfers between levels in the fair value hierarchy. The amendments also clarify the requirements for liquidity risk disclosures with respect to derivative transactions and financial assets used for liquidity management.

The liquidity risk disclosures and fair value measurement disclosures are presented in Notes 4 and 5, respectively.

The issuance of and amendments to the following PAS, PFRS, and Philippine Interpretations did not have any impact on the accounting policies, financial position or performance of the Organization:

x PAS 23, Borrowing Cost x PAS 32 and PAS 1 Amendments Puttable Financial Instruments and Obligations x x x x

x x

Arising on Liquidation PFRS 1 and PAS 27 Amendments Cost of an Investment in a Subsidiary, Jointly Controlled Entity or Associate PFRS 2 Amendment Vesting Conditions and Cancellations PFRS 8, Operating Segments Philippine Interpretation International Financial Reporting Interpretation Committee (IFRIC) 13, Customer Loyalty Programmes Philippine Interpretation IFRIC 16, Hedges of a Net Investment in a Foreign Operation Philippine Interpretation IFRIC 9 and PAS 39 Amendments Embedded Derivatives

*SGVMC114125* '

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Improvements to PFRSs 2008 The omnibus amendments to PFRSs issued in 2008 (and 2009 with respect to PAS 18) were issued primarily with a view to removing inconsistencies and clarifying wording. There are separate transitional provisions for each standard. The adoption of the following amendments resulted in changes in accounting policies but did not have an impact on the financial position or performance of the Organization:

x

PFRS 1, First time Adoption of PFRS Cost of an Investment in a Subsidiary, Jointly Controlled Entity or Associate PFRS 2, Share based Payment Vesting Condition and Cancellations PFRS 5, Non current Assets Held for Sale and Discontinued Operations PAS 19, Employee Benefits PAS 23, Borrowing Costs PAS 28, Investment in Associates PAS 31, Interest in Joint Ventures PAS 36, Impairment of Assets PAS 38, Intangible Assets PAS 39, Financial Instruments: Recognition and Measurement PAS 41, Agriculture

x x x x x x x x x x

Improvements to PFRS 2009 x PAS 18, Revenue: The amendment adds guidance (which accompanies the standard) to determine whether an entity is acting as a principal or as an agent. The features to consider are whether the entity: has primary responsibility for providing the goods or service; has inventory risk; has discretion in establishing prices; or bears the credit risk.

The amendment did not have an impact on the accounting policies, financial position or performance of the Organization.

*SGVMC114125* 28

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Significant Accounting Policies

Cash and Cash Equivalents For the purpose of the statement of cash flows, cash includes petty cash fund and cash in banks. Cash equivalents consist of time deposit placements with original maturities of three months or less from dates of placements and that are subject to an insignificant risk of changes in value.

Financial Instruments Initial Recognition and Subsequent Measurement Date of recognition Purchases or sales of financial assets that require delivery of assets within the time frame established by regulation or market convention are recognized on settlement date the date that an asset is delivered to or by the Organization.

Initial recognition of financial instruments All financial instruments are initially recognized at fair value. Except for financial assets at fair value through profit or loss (FVPL), the initial measurement of financial assets includes transaction costs. The Organization classifies its financial assets in the following categories: financial assets at FVPL, held to maturity (HTM) investments, AFS investments, and loans and receivables. The classification depends on the purpose for which the financial assets were acquired and whether they are quoted in an active market. Financial liabilities are classified into financial liabilities at FVPL and other financial liabilities at cost or amortized cost. Management determines the classification of its financial instruments at initial recognition and, where allowed and appropriate, re evaluates such designation at every reporting date.

As of December 31, 2009 and 2008, the Organization had no HTM investments and financial liabilities at FVPL.

Reclassification of financial assets A financial asset is reclassified out of the FVPL category when the following conditions are met: x the financial asset is no longer held for the purpose of selling or repurchasing it in the near term; and x there is a rare circumstances.

*SGVMC114125* '

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A financial asset that is reclassified out of the FVPL category is reclassified at its fair value on the date of reclassification. Any gain or loss already recognized in the statement of comprehensive income is not reversed. The fair value of the financial asset on the date of reclassification becomes its new cost or amortized cost, as applicable.

Determination of fair value The fair value for financial instruments traded in active markets at the statement of assets, liabilities and fund balance date is based on their quoted market price or dealer price quotations, without any deduction for transaction costs. When current bid and asking prices are not available, the price of the most recent transaction provides evidence of the current fair value as long as there has not been a significant change in economic circumstances since the time of the transaction.

For all other financial instruments not listed in an active market, the fair value is determined by using appropriate valuation techniques. Valuation techniques include net present value techniques, comparison to similar instruments for which market observable prices exist, option pricing models, and other relevant valuation models.

Financial assets or financial liabilities at FVPL This category consists of financial assets that are held for trading or designated by management as FVPL on recognition.

Financial assets at FVPL are recorded in the statement of assets, liabilities and fund balance at fair value, with changes in the fair value recorded in the statement of comprehensive income included under â&#x20AC;&#x2DC;Other incomeâ&#x20AC;&#x2122;. Interest earned or incurred is recorded in â&#x20AC;&#x153;Other incomeâ&#x20AC;? or â&#x20AC;&#x2DC;Interest expenseâ&#x20AC;&#x2122;, respectively.

Financial assets classified in this category are designated by management on initial recognition when any of the following criteria are met:

x The designation eliminates or significantly reduces the inconsistent treatment that would otherwise arise from measuring the assets or liabilities or recognizing gains or losses on them on a different basis; or

*SGVMC114125* 30

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x

The assets are part of a group of financial assets which are managed and their performance evaluated on a fair value basis, in accordance with a documented risk management or investment strategy; or

x

The financial instrument contains an embedded derivative, unless the embedded derivative does not significantly modify the cash flows or it is clear, with little or no analysis, that it would not be separately recorded.

AFS investments AFS investments are those which are designated as such or do not qualify to be categorized as financial assets at FVPL, HTM investments or loans and receivables. They are purchased and held indefinitely, and may be sold in response to liquidity requirements or changes in market conditions. These include equity investments and other debt instruments.

After initial measurement, AFS investments are subsequently measured at fair value. The unrealized gains and losses arising from the fair valuation of AFS investments are excluded, net of tax, from reported earnings and are reported as â&#x20AC;&#x2DC;Unrealized gain (loss) on AFS investmentsâ&#x20AC;&#x2122; in the fund balance of statement of assets, liabilities and fund balance.

Unquoted AFS investments are measured at cost less any allowance for impairment.

When the security is disposed, the cumulative gain or loss previously recognized in the fund balance is recognized as â&#x20AC;&#x2DC;Other incomeâ&#x20AC;&#x2122; in the statement of comprehensive income. Where the Organization holds more than one investment in the same security, these are deemed to be disposed based on weighted average. Dividends earned on holding AFS equity securities are recognized in the statement of comprehensive income as â&#x20AC;&#x2DC;Other incomeâ&#x20AC;&#x2122; when the right to receive payment has been established. The losses arising from impairment of such investments are recognized as â&#x20AC;&#x2DC;Provision for credit and impairment lossesâ&#x20AC;&#x2122; in the statement of comprehensive income.

Loans and receivables Loans and receivables are non derivative financial assets with fixed or determinable payments and fixed maturities that are not quoted in an active market. They are not entered into with the intention of immediate or short term resale and are not classified as other financial assets held for trading, designated as AFS investments or financial assets designated at FVPL.

*SGVMC114125* '

31

After initial measurement, the loans and receivables are subsequently measured at amortized cost using the EIR method, less allowance for any credit and impairment losses.

Amortized cost is calculated by taking into account any discount or premium on acquisition and fees that are integral part of the EIR. The amortization is included in â&#x20AC;&#x2DC;Other incomeâ&#x20AC;&#x2122; in the statement of comprehensive income. The losses arising from impairment of such loans and receivables are recognized in â&#x20AC;&#x2DC;Provision for credit and impairment lossesâ&#x20AC;&#x2122; in the statement of comprehensive income.

Interest bearing loans and borrowings All loans and borrowings are initially recognized at the fair value less directly attributable transaction costs and have not been designated as financial liabilities at fair value through profit or loss. 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 the statement of comprehensive income when the liabilities are derecognized as well as through the amortization process.

Derecognition of Financial Assets and Liabilities Financial asset A financial asset (or, where applicable a part of a financial asset or part of a group of financial assets) is derecognized where:

x x x

the rights to receive cash flows from the asset have expired; or the Organization retains the right to receive cash flows from the asset, but has assumed an obligation to pay them in full without material delay to a third party under a â&#x20AC;&#x153;pass throughâ&#x20AC;? arrangement; or the Organization has transferred its rights to receive cash flows from the asset and either (a) has transferred substantially all the risks and rewards of the asset, or (b) has neither transferred nor retained the risk and rewards of the asset but has transferred the control of the asset.

Where the Organization has transferred its rights to receive cash flows from an asset or has entered into a pass through arrangement, and has neither transferred nor retained substantially all the risks and rewards of the asset nor transferred control of the asset, the asset is recognized to the extent of the Organizationâ&#x20AC;&#x2122;s continuing involvement in the asset.

*SGVMC114125* 32

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Continuing involvement that takes the form of a guarantee over the transferred asset is measured at the lower of original carrying amount of the asset and the maximum amount of consideration that the Organization could be required to repay.

Financial liabilities Financial liabilities are derecognized when the obligation under the liability is discharged or cancelled or has expired. Where an existing financial liabilities are 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, and the difference in the respective carrying amounts is recognized in the statement of comprehensive income.

Offsetting Financial Instruments Financial assets and financial liabilities are offset and the net amount reported in the statement of assets, liabilities and fund balance if, and only 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 asset and settle the liability simultaneously.

Impairment of Financial Assets The Organization assesses at each reporting date whether there is objective evidence that a financial asset or group of financial assets is impaired. A financial asset or a group of financial assets is deemed to be impaired if, and only 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 â&#x20AC;&#x2DC;loss eventâ&#x20AC;&#x2122;) and that loss event (or events) 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 indications that the customer or a group of customers is experiencing significant financial difficulty, default or delinquency in interest or principal payments, the probability that they will enter bankruptcy or other financial reorganization and where observable data indicate that there is measurable decrease in the estimated future cash flows, such as changes in arrears or economic conditions that correlate with defaults.

*SGVMC114125* '

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Loans and receivables For receivables carried at amortized cost, the Organization first assesses whether objective evidence of impairment exists individually for financial assets that are individually significant, or collectively for financial assets that are not individually significant. If the Organization determines that no objective evidence of impairment exists for individually assessed financial asset, whether significant or not, the asset is included in a group of financial assets with similar credit risk characteristics and collectively assesses for impairment. Those characteristics are relevant to the estimation of future cash flows for groups of such assets by being indicative of the debtorsâ&#x20AC;&#x2122; ability to pay all amounts due according to the contractual terms of the assets being evaluated. 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 assetâ&#x20AC;&#x2122;s carrying amount and the present value of the estimated future cash flows (excluding future credit losses that have not been incurred). The carrying amount of the asset is reduced through use of an allowance account and the amount of loss is charged against the statement of comprehensive income. Interest income continues to be recognized based on the original EIR of the asset. Loans, together with the associated allowance accounts, are written off when there is no realistic prospect of future recovery and all collateral has been realized. If, in a subsequent year, the amount of the estimated impairment loss decreases because of an event occurring after the impairment was recognized, the previously recognized impairment loss is reduced by adjusting the allowance account. If a future write off is later recovered, any amounts formerly charged are credited to the â&#x20AC;&#x2DC;Allowance for credit and impairment lossesâ&#x20AC;&#x2122; account.

For the purpose of a collective evaluation of impairment, financial assets are grouped on the basis of such credit risk characteristics as industry, collateral type, past due status and term.

Future cash flows in a group of financial assets that are collectively evaluated for impairment are estimated on the basis of historical loss experience for assets with credit risk characteristics similar to those in the group. Historical loss experience is adjusted on the basis of current observable data to reflect the effects of current conditions that did not affect the period on which the historical loss experience is based and to remove the effects of conditions in the historical period that do not exist currently. Estimates of changes in

*SGVMC114125* 34

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future cash flows reflect, and are directionally consistent with changes in related observable data from period to period (such changes in unemployment rates, property prices, commodity prices, payment status, or other factors that are indicative of incurred losses in the group and their magnitude). The methodology and assumptions used for estimating future cash flows are reviewed regularly by the Organization to reduce any differences between loss estimates and actual loss experience.

The Organization uses the allowance method in accounting for impairment of loans and receivables.

AFS investments For AFS investments, the Organization assesses at each reporting date whether there is objective evidence that a financial asset or group of financial assets is impaired.

In case of AFS equity investments this would include a significant or prolonged decline in the fair value of the investments below its cost. Where there is evidence of impairment, the cumulative loss measured as the difference between the acquisition cost and the current fair value, less any impairment loss on that financial asset previously recognized in the statement of comprehensive income is removed from the fund balance and recognized in the statement of comprehensive income. Impairment losses on AFS investments are not reversed through the statement of comprehensive income. Increases in fair value after impairment are recognized directly in the fund balance.

Prepaid Expenses These are advance payments to various expenditures related to the business activities of the Organization. These are amortized during the period of utilization.

Property and Equipment Land is stated at cost less any impairment loss and depreciable properties including buildings and improvements, leasehold improvements, furniture and equipment and transportation equipment are stated at cost less accumulated depreciation and amortization, and any impairment loss. Such cost includes the cost of replacing part of the property and equipment when that cost is incurred, if the recognition criteria are met but excludes repairs and maintenance costs.

*SGVMC114125* '

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The initial cost of property and equipment comprises its purchase price, including taxes and directly attributable costs of bringing the assets to its working condition and location for its intended use. Expenditures incurred after the fixed asset have been put into operation, such as repairs and maintenance, are normally charged against current operations in the period in which costs are incurred. In situations where it can be clearly demonstrated that the expenditures have resulted in an increase in the future economic benefits expected to be obtained from the use of an item of property and equipment beyond its originally assessed standard of performance, the expenditures are capitalized as additional costs of property and equipment.

When assets are retired or otherwise disposed of, the cost and the related accumulated depreciation and amortization and any impairment loss are removed from the accounts, and any resulting gain or loss is credited or charged against current operations.

Depreciation of property and equipment is computed using the straight line method over the estimated useful life of the property and equipment. Leasehold improvements, which consist of improvements on leased properties, are being amortized over the shorter of the estimated useful life of the asset or the period of lease agreement.

The estimated useful lives of depreciable assets in number of years are as follows:

Building and improvements Leasehold improvements Furniture and equipment Transportation equipment

40 3 3 5

The useful life and depreciation and amortization method are reviewed periodically to ensure that the period and method of depreciation and amortization are consistent with the expected pattern of economic benefits from property and equipment.

*SGVMC114125* 36

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The carrying values of property and equipment are reviewed for impairment when events or changes in circumstances indicate that the carrying value may not be recoverable. If any such indication exists and where the carrying values exceed the estimated recoverable amounts, the assets are written down to their recoverable amounts.

Computer Software Costs Computer software costs are capitalized on the basis of the costs incurred to acquire and bring to use the specific software. They are carried at acquisition cost less accumulated amortization and any impairment loss. These costs are amortized over 3 years on a straight line basis.

Impairment of Nonfinancial Assets Property and equipment At each statement of reporting date, the Organization assesses whether there is any indication that its property and equipment may be impaired. When an indicator of impairment exists or when an annual impairment testing for an asset is required, the Organization makes a formal estimate of recoverable amount. Recoverable amount is the higher of an assetâ&#x20AC;&#x2122;s fair value less costs to sell and its value in use and is determined for an individual asset, unless the asset does not generate cash inflows that are largely independent of those from other assets or groups of assets, in which case the recoverable amount is assessed as part of the cash generating unit to which it belongs. Where the carrying amount of an asset exceeds its recoverable amount, the asset 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 pre tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset.

An impairment loss is charged to operations in the period in which it arises, unless the asset is carried at a revalued amount, in which case the impairment loss is charged to the revaluation increment of the said asset.

Impairment 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 recoverable amount is estimated. A previously recognized impairment loss is reversed only if there has been a change in the estimates used to

*SGVMC114125* '

37

determine the assetâ&#x20AC;&#x2122;s recoverable amount since the last impairment loss was recognized. If that is the case, the carrying amount of the asset is increased to its recoverable amount.

That increased amount cannot 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 the statement of comprehensive unless the asset is carried at a revalued amount, in which case the reversal is treated as a revaluation increase. After such a reversal, the depreciation expense is adjusted in future years to allocate the assetâ&#x20AC;&#x2122;s revised carrying amount, less any residual value, on a systematic basis over its remaining life.

Revenue Recognition Revenue is recognized to the extent that it is probable that the economic benefits will flow to the Organization and the revenue can be reliably measured. The following specific recognition criteria must also be met before the revenue is recognized:

Donations and contributions Donations and contributions received are recognized as income in the statement of comprehensive income upon receipt.

Interest income For all financial asset measured at amortized cost, interest income is recorded at the EIR, which is the rate that exactly discounts estimated future cash payments or receipts through the expected life of the financial asset or a shorter period, where appropriate, to the net carrying amount of the financial asset. The calculation takes into account all contractual terms of the financial asset, includes any fees (such as service fees) or incremental costs that are directly attributable to the instrument and are an integral part of the EIR, but not future credit losses. The adjusted carrying amount is calculated based on the original EIR. The change in carrying amount is recorded as interest income.

Once the recorded value of a financial asset or group of similar financial assets has been reduced due to an impairment loss, interest income continues to be recognized using the original EIR applied to the new carrying amount.

*SGVMC114125* 38

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Leases The determination of whether an arrangement is, or contains a lease is based on the substance of the arrangement and requires an assessment of whether the fulfillment of the arrangement is dependent on the use of a specific asset or assets and the arrangement conveys a right to use the asset. A reassessment is made after inception of the lease only if one of the following applies:

(a) there is a change in contractual terms, other than a renewal or extension of the arrangement; (b) a renewal option is exercised or extension granted, unless that term of the renewal or extension was initially included in the lease term; (c) there is a change in the determination of whether fulfillment is dependent on a specified asset; or (d) there is a substantial change to the asset.

Where a reassessment is made, lease accounting shall commence or cease from the date when the change in circumstances gave rise to the reassessment for scenarios (a), (c) or (d) above, and at the date of renewal or extension period for scenario (b).

Organization as Lessee Leases where the lessor retains substantially all the risks and benefits of ownership of the asset are classified as operating leases. Operating lease payments are recognized as â&#x20AC;&#x2DC;Operating expensesâ&#x20AC;&#x2122; in the statement of comprehensive income on a straight line basis over the lease term.

Foreign Currency Transactions and Translations Foreign currency denominated monetary assets and liabilities of the Organization are translated into Philippine peso based on the Philippine Dealing System (PDS) closing rate prevailing at end of the year and foreign currency denominated income and expenses are translated based on the PDS weighted average rate (PDSWAR) for the year. Foreign exchange differences arising from revaluation of foreign currency denominated assets and liabilities are credited to or charged against operations in the period in which the rates change.

*SGVMC114125* '

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Nonmonetary items that are measured in terms of historical cost on a foreign currency are translated using the exchange rates as at the dates of the initial transactions. Nonmonetary items measured at fair value in a foreign currency are translated using the exchange rates at the date when the fair value was determined.

Unearned Service Income Unearned service fee pertains to 1.00% of loan amount for clients above 63 years old collected from the borrower upon loan grant. Unearned service fee is earned as revenue (shown under â&#x20AC;&#x2DC;Service Incomeâ&#x20AC;&#x2122; in the statement of comprehensive income) throughout the period of coverage and a liability is set up at the reporting date equivalent to the unearned service fee for the unexpired period.

For purposes of complying with the provisions of PFRS 4, Insurance Contracts, the Organization classifies its life plans as insurance contracts. Insurance contracts are defined as those contracts under which the Organization (the insurer) accepts significant insurance risk from another party (the planholder) by agreeing to compensate the planholder if a specified uncertain future event (the insured event) adversely affects the planholder. As a general guideline, the Organization defines significant insurance risk by comparing benefits paid with benefits payable if the insured event did not occur.

Once a contract has been classified as an insurance contract, it remains an insurance contract for the remainder of its lifetime, even if the insurance risk reduces significantly during this period, unless all rights and obligations are extinguished or expire.

As provided under PFRS 4, this product classification exercise is solely for accounting purposes and does not make the Organization an insurance company for statutory or regulatory purposes. The Organization is under the regulation of the SEC.

Claims are recognized as incurred after the beneficiary has fulfilled the necessary requirements set forth by the Organization. As of December 31, 2009, there were no unpaid claims by the Organization to the program membersâ&#x20AC;&#x2122; beneficiary.

Retirement Cost The Organization has an unfunded noncontributory defined benefit retirement plan, administered by trustees, covering substantially all of its permanent employees.

*SGVMC114125* 40

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The retirement cost of the Organization is determined using the projected unit credit method. Under this method, the current service cost is the present value of retirement benefits payable in the future with respect to services rendered in the current year.

The liability recognized in the statement of assets, liabilities and fund balance in respect of defined benefit pension plans (see Note 15) is the present value of the defined benefit obligation at the reporting date, together with adjustments for unrecognized actuarial gains or losses and past service costs. The defined benefit obligation is calculated annually by an independent actuary using the projected unit credit method. The present value of the defined benefit obligation is determined by discounting the estimated future cash outflows using interest rate on government bonds that have terms to maturity approximating the terms of the related retirement liability. Actuarial gains and losses arising from experience adjustments and changes in actuarial assumptions are credited to or charged against income when the net cumulative unrecognized actuarial gains and losses at the end of the previous period exceeded 10.00% of the higher of the defined benefit obligation and the fair value of plan assets at that date. These gains or losses are recognized over the expected average remaining working lives of the employees participating in the plan.

Past service costs, if any, are recognized immediately in statement of comprehensive income, unless the changes to the pension plan are conditional on the employees remaining in service for a specified period of time (the vesting period). In this case, the past service costs are amortized on a straight line basis over the vesting period.

The defined benefit asset or liability comprises the present value of the defined benefit obligation less past service costs not yet recognized and less the fair value of plan assets out of which the obligations are to be settled directly. The value of any asset is restricted to the sum of any past service cost not yet recognized and the present value of any economic benefits available in the form of refunds from the plan or reductions in the future contributions to the plan.

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

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Contingent Liabilities and Contingent Assets Contingent liabilities are not recognized in the financial statements but are disclosed unless the possibility of an outflow of resources embodying economic benefits is remote.

Contingent assets are not recognized in the financial statements but are disclosed in the financial statements when an inflow of economic benefits is probable.

Events after the Reporting date Any post year end event that provides additional information about the Organizationâ&#x20AC;&#x2122;s position at the reporting date (adjusting events) is reflected in the financial statements.

Post year end events that are not adjusting events are disclosed in the notes to the financial statements when material.

Future Changes in Accounting Policies The Organization will adopt the Standards and Interpretations enumerated below when these become effective as applicable. Except as otherwise indicated, the Organization does not expect the adoption of these new and amended PFRSs and Philippine Interpretations to have significant impact on its financial statements.

Effective in 2010 Revised PFRS 3, Business Combinations and PAS 27, Consolidated and Separate Financial Statements The revised PFRS 3 introduces a number of changes in the accounting for business combinations that will impact the amount of goodwill recognized, the reported results in the period that an acquisition occurs, and future reported results. The revised PAS 27 requires, among others, that (a) change in ownership interests of a subsidiary (that do not result in loss of control) will be accounted for as an equity transaction and will have no impact on goodwill nor will it give rise to a gain or loss; (b) losses incurred by the subsidiary will be allocated between the controlling and non controlling interests (previously referred to as â&#x20AC;&#x2DC;minority interestsâ&#x20AC;&#x2122;); even if the losses exceed the non controlling equity investment in the subsidiary; and (c) on loss of control of a subsidiary, any retained interest will be remeasured to fair value and this will impact the gain or loss recognized on disposal. The changes introduced by the revised PFRS 3 and PAS 27 must be applied prospectively and will affect future acquisitions and transactions with non controlling interests.

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Amendment to PAS 39, Financial Instruments: Recognition and Measurement Eligible hedged items Amendment to PAS 39 will be effective on July 1, 2009, which addresses only the designation of a one sided risk in a hedged item, and the designation of inflation as a hedged risk or portion in particular situations. The amendment clarifies that an entity is permitted to designate a portion of the fair value changes or cash flow variability of a financial instrument as a hedged item.

Philippine Interpretation IFRIC 17, Distribution of Non cash Assets to Owners This Interpretation covers accounting for two types of non reciprocal distributions of assets by an entity to its owners acting in their capacity as owners. The two types of distribution are:

a. Distributions of non cash assets (eg items of property, plant and equipment, businesses as defined in IFRS 3, ownership interests in another entity or disposal groups as defined in IFRS 5); and b. Distributions that give owners a choice of receiving either non cash assets or a cash alternative.

This Interpretation addresses only the accounting by an entity that makes a non cash asset distribution. It does not address the accounting by shareholders who receive such a distribution.

Philippine Interpretation IFRIC 18, Transfers of Assets from Customers This Interpretation covers accounting for transfers of items of property, plant and equipment by entities that receive such transfers from their customers. Agreements within the scope of this Interpretation are agreements in which an entity receives from a customer an item of property, plant and equipment that the entity must then use either to connect the customer to a network or to provide the customer with ongoing access to a supply of goods or services, or to do both. This Interpretation also applies to agreements in which an entity receives cash from a customer when that amount of cash must be used only to construct or acquire an item of property, plant and equipment and the entity must then use the item of property, plant and equipment either to connect the customer to a network or to provide the customer with ongoing access to a supply of goods or services, or to do both.

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Effective in 2012 Philippine Interpretation IFRIC 15, Agreement for Construction of Real Estate This Interpretation covers accounting for revenue and associated expenses by entities that undertake the construction of real estate directly or through subcontractors. This Interpretation requires that revenue on construction of real estate be recognized only upon completion, except when such contract qualifies as construction contract to be accounted for under PAS 11, Construction Contracts, or involves rendering of services in which case revenue is recognized based on stage of completion. Contracts involving provision of services with the construction materials and where the risks and reward of ownership are transferred to the buyer on a continuous basis, will also be accounted for based on stage of completion.

Improvements to PFRSs In April 2009, the IASB issued its second omnibus of amendments to certain standards as approved by the Financial Reporting Standards Council in its meeting in May 2009. The following are the separate transitional provisions for each standard and the Organization will assess the impact of improvements to these standards once effective:

PFRS 2, Shared Based Payments x The amendment clarifies that the contribution of a business on formation of a joint venture and combinations under common control are not within the scope of PFRS 2 even though they are out of scope of PFRS 3.

PFRS 5, Non current Assets Held for Sale and Discontinued Operations x The amendment clarifies that the disclosures required in respect of non current assets or disposal groups classified as held for sale or discontinued operations are only those set out in PFRS 5. The disclosure requirements of other PFRSs only apply if specifically required for such non current assets or discontinued operations. x It also clarifies that the general requirements of PAS 1 still apply, particularly paragraphs 15 (to achieve a fair presentation) and 125 (sources of estimation uncertainty) of PAS 1.

PFRS 8, Operating Segments x The amendment clarifies that segment assets and liabilities need only to be reported when those assets and liabilities are included in measures that are used by the chief operating decision maker.

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PAS 1, Presentation of Financial Statements x The terms of a liability that could result, at anytime, in its settlement by the issuance of equity instruments at the option of the counterparty do not affect its classification.

PAS 7, Statement of Cash Flows x The amendment explicitly states that only expenditure that results in a recognized asset can be classified as a cash flow from investing activities.

PAS 17, Leases x The amendment removes the specific guidance on classifying land as a lease so that only the general guidance remains.

PAS 18, Revenue x The Board has added guidance (which accompanies the standard) to determine whether an entity is acting as a principal or as an agent. The features indicating an entity is acting as a principal are whether the entity: o has primary responsibility for providing the goods or service; o has inventory risk; o has discretion in establishing prices; o bears the credit risk.

PAS 36, Impairment of Assets x The amendment clarifies that the largest unit permitted for allocating goodwill acquired in a business combination is the operating segment, as defined in PFRS 8 before aggregation for reporting purposes.

PAS 38, Intangible Assets x That amendment clarifies that if an intangible asset acquired in a business combination is identifiable only with another intangible asset, the acquirer may recognize the group of intangible assets as a single asset provided the individual assets have similar useful lives. x It also clarifies that the valuation techniques presented for determining the fair value of intangible assets acquired in a business combination that are not traded in active markets are only examples and are not restrictive on the methods that can be used.

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PAS 39, Financial Instruments: Recognition and Measurement x That amendment clarifies that a prepayment option is considered closely related to the host contract when the exercise price of a prepayment option reimburses the lender up to the approximate present value of lost interest for the remaining term of the host contract. x That amendment also clarifies that the scope exemption for contracts between an acquirer and a vendor in a business combination to buy or sell an acquiree at a future date, applies only to binding forward contracts, and not derivative contracts where further actions by either party are still to be taken. x It also clarifies that gains or losses on cash flow hedges of a forecast transaction that subsequently results in the recognition of a financial instrument or on cash flow hedges of recognized financial instruments should be reclassified in the period that the hedged forecast cash flows profit or loss.

IFRIC 9, Reassessment of Embedded Derivatives x The improvement clarifies that it does not apply to possible reassessment, at the date of acquisition, to embedded derivatives in contracts acquired in a combination between entities or businesses under common control or the formation of a joint venture.

IFRIC 16, Hedges of a Net Investment in a Foreign Operation x The improvement states that, in a hedge of a net investment in a foreign operation, qualifying hedging instruments may be held by any entity or entities within the group, including the foreign operation itself, as long as the designation, documentation and effectiveness requirements of PAS 39 that relate to a net investment hedge are satisfied.

3. Significant Accounting Judgments and Estimates

The preparation of the financial statements in accordance with PFRS requires the Organization to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue and expenses and the disclosures of contingent assets and contingent liabilities. Future events may occur which will cause the assumptions used in arriving at the estimates to change. The effects of any change in estimates are reflected in the financial statements as they become reasonably determinable.

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Judgments and estimates are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.

Judgments a) Fair value of financial instruments Where the fair values of financial assets and financial liabilities recorded in the statement of assets, liabilities and fund balance cannot be derived from active markets, these are determined using internal valuation techniques using generally accepted market valuation models. The inputs to these models are taken from observable markets where possible, but where this is not feasible, estimates are used in establishing fair values. These estimates may include considerations of liquidity, volatility and correlation.

b) Operating leases The Organization has entered into commercial property leases with outside parties wherein the latter retains all the significant risks and rewards of ownership of those properties leased out under operating leases. These operating leases are subject to two to three year terms and are renewable upon agreement of both parties.

In determining whether or not there is indication of operating lease, the Organization considers retention of ownership title to the leased property, leases of executory costs, and among others.

c) Financial assets not quoted in an active market The Organization classifies financial assets by evaluating, among others, whether the asset is quoted or not in an active market. Included in the evaluation on the whether the asset is quoted in an active market is the determination on whether the quoted prices are readily and regularly available, and whether those prices represent actual and regularly occurring market transactions on an armâ&#x20AC;&#x2122;s length basis.

Estimates a) Allowance for credit losses on receivables The Organization maintains allowances for credit losses at a level considered adequate to provide for probable uncollectible loans and receivables. The level of this allowance is

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evaluated by management on the basis of factors that affect the collectibility of the accounts. These factors include, but are not limited, to the clientâ&#x20AC;&#x2122;s payment behavior and known market factors. The Organization reviews the age and status of loans and receivables, and identifies accounts that are to be provided with allowances on a continuous basis.

As of December 31, 2009 and 2008 loans and receivables have carrying value amounting to P =514.41 million and P =385.40 million, respectively, net of allowance for credit losses amounting to P =33.18 million and P =15.73 million, respectively (see Note 8).

b) Impairment of AFS equity investments The Organization determines that AFS equity investments are impaired when there has been a significant or prolonged decline in the fair value below its cost. The determination of what is significant or prolonged requires judgment. The Organization treats â&#x20AC;&#x2DC;significantâ&#x20AC;&#x2122; generally as a decline of more than 20.00% from the original cost of investments and â&#x20AC;&#x2DC;prolongedâ&#x20AC;&#x2122; as more than six (6) months. In making this judgment, the Organization evaluates among other factors, the normal volatility in share price.

In addition, impairment may be appropriate when there is evidence of deterioration in the financial health of the investee, industry and sector performance, changes in technology, and operational and financing cash flows.

As of December 31, 2009 and 2008, AFS equity investments are carried P =7.64 million, respectively, net of allowance for impairment losses amounting to P =20.96 million, respectively (see Note 10).

c) Present value of pension liability The cost of defined benefit pension plan and other post employment benefits is determined using actuarial valuations. The actuarial valuation involves making assumptions about discount rates, expected rates of return on assets, future salary increases, mortality rates and future pension increases. Due to the long term nature of these plans, such estimates are subject to significant uncertainty.

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As of December 31, 2009 and 2008, the present value of the defined benefit obligation amounted to P =17.85 million and P =0.33 million, respectively (see Note 15).

d) Impairment of property and equipment The Organization assesses impairment on assets whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable.

The factors that the Organization considers important which could trigger an impairment review include the following:

x x x

significant underperformance relative to expected historical or projected future operating results; significant changes in the manner of use of the acquired assets or the strategy for overall business; and significant negative industry or economic trends.

The Organization recognizes an impairment loss whenever the carrying amount of an asset exceeds its recoverable amount. The recoverable amount is computed using the value in use approach. Recoverable amounts are estimated for individual assets or, if it is not possible, for the cash generating unit to which the asset belongs.

As of December 31, 2009 and 2008, the carrying value of the property and equipment amounted to P =35.58 million and P =17.03 million, respectively (see Note 11).

4. Fair Value Measurement

The methods and assumptions used by the Organization in estimating the fair value of the financial instruments are:

Assets and liabilities for which the fair value approximates carrying value For financial assets and financial liabilities that are liquid or having short term maturity, it is assumed that the carrying amounts approximate their fair values. These include cash and cash equivalents, and current liabilities.

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AFS investment For equity investment that is not quoted, the investment is carried at cost less allowance for impairment losses due to the unpredictable nature of future cash flows and the lack of suitable methods of arriving at a reliable fair value.

Loans and receivables Fair values of loans and receivables are estimated using the discounted cash flow methodology, using the Organizationâ&#x20AC;&#x2122;s current incremental lending rates for similar types of loans. Where the instrument reprices on a quarterly basis or has a relatively short maturity, the carrying amounts approximate fair values.

Liabilities Fair values are estimated using the discounted cash flow methodology using the Organizationâ&#x20AC;&#x2122;s current incremental borrowing rates for similar borrowings with maturities consistent with those remaining for the liability being valued, if any.

Set out below is a comparison by category of carrying amounts and fair value of the Organizationâ&#x20AC;&#x2122;s financial assets and liabilities.

Financial Assets Financial assets at FVPL Quoted equity securities AFS investment Unquoted equity security Loans and receivables Cash and cash equivalents Loans receivables Interest receivable Other receivable

Financial Liabilities Accrued expenses and other payables Current portion of long term debt Capital build up

2009 Carrying Value Fair Value

P =385,155 P =385,155

7,638,405 7,638,405

143,120,763 143,120,763 491,377,208 491,377,208 9,337,378 9,337,378 13,690,608 13,690,608

34,274,881 â&#x20AC;&#x201C; 293,744,643

34,274,881 â&#x20AC;&#x201C; 293,744,643

2008 Carrying Value

P =302,679

7,638,405

203,724,118 371,522,896 7,434,220 6,444,673

Fair value

P =302,679

7,638,405

203,724,118 371,522,896 7,434,220 6,444,673

16,500,099 10,000,000 228,373,811

16,500,099 10,000,000 228,373,811

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Fair Value Hierarchy The Organization uses the following hierarchy for determining and disclosing the fair value of financial instruments by valuation technique:

x x x

Quoted prices in active markets for identical assets or liabilities (Level 1); Those involving inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly (as prices) or indirectly (derived from prices) (Level 2); and Those with inputs for the asset or liability that are not based on observable market data (unobservable inputs) (Level 3).

As of December 31, 2009 and 2008, only the financial assets at fair value through profit or loss are presented as under Level 1 of the fair value hierarchy which amounts to P =385,155 and P =302,679.

There were no transfers between Level 1 and Level 2 fair value measurements, and no transfers into and out of Level 3 fair value measurements during the years ended December 31, 2009 and 2008.

5. Financial Risk Management Objectives and Policies

The Organizationâ&#x20AC;&#x2122;s financial instruments consist of cash and cash equivalents, financial assets at FVPL, AFS investments, loans and receivable and bank loans, accrued expenses and other payables and capital build up. The main risks arising from the use of these financial instruments are credit risk, liquidity risk and market risk.

Risk Management Framework The Board of Trustees (BOT) has overall responsibility for the oversight of the Organizationâ&#x20AC;&#x2122;s risk management process. The board committee, which is responsible for developing, managing and monitoring risk management policies in their specified areas is the Executive Committee (EXCOM).

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The BOTâ&#x20AC;&#x2122;s functions are supported by the EXCOM, which is the implementing arm of the Organization and shall make directional decisions on policies already laid down by the Board.

It shall ensure that every detail of the rules, approved plans, operations and policies of the Organization shall be carried out faithfully.

Credit Risk Credit risk is the risk of financial loss to the Organization if a counterparty to a financial instrument fails to meet its contractual obligations. The Organization has established controls and procedures in its credit policy to determine and monitor credit worthiness of customers and counterparties.

The Organization does not, in principal, use collateral to reduce its credit risks. However, after maturity of the loan, the Organization may offset the program memberâ&#x20AC;&#x2122;s outstanding loan balance against his Capital build up.

Maximum exposure to credit risk An analysis of the maximum exposure to credit risk relating to on balance sheet assets without taking into account of any collateral held or other credit enhancements is shown below:

Cash and cash equivalents (Note 6) Financial assets at FVPL (Note 7) Loans and receivables (Note 8)

2009 P =142,922,763 385,155 514,405,194 P =657,713,112

2008 P =203,580,118 302,679 385,401,789 P =589,284,586

The Organization assessed that it has no significant credit risk exposures relating to off balance sheet items.

As of December 31, 2009 and 2008 neither past due nor impaired loans and receivable amounted to P =493.72 million and P =371.43 million, respectively, which were granted to women who are among the economically active poor in communities with high population densities and levels of microeconomic activity.

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An aging analysis of past due receivables are shown below:

1 30 days 31 60 days 61 90 91 180 days Over 180 days

2009 P =2,556,515 3,681,192 2,144,518 3,898,758 17,704,420 P =29,985,403

2008 P =2,303,094 1,452,076, 779,642 135,587 7,371,939 P =12,042,338

Concentration risk The Organization assessed that its exposure to concentration risk is minimal since it enforce a principle in the selection of program members which is in consonance with the Organizationâ&#x20AC;&#x2122;s objective of targeting women who are among the economically active poor in communities with high population densities and levels of microeconomic activity.

Liquidity Risk The Organization manages liquidity risk by maintaining a balance between continuity of funding and flexibility. Treasury controls and procedures are in place to ensure that sufficient cash is maintained to cover daily operational and working capital requirements.

Management closely monitors the Organizationâ&#x20AC;&#x2122;s future and contingent obligations and sets up required cash services as necessary in accordance with internal policies.

The table below shows the maturity profile of the financial instruments, based on contractual undiscounted cash flows.

Financial assets Cash and cash equivalents Financial assets at fair value through profit or loss Loans and Receivables

On demand

1 to 3 months

P =143,212,942

P =â&#x20AC;&#x201C;

385,155 3,852,000 P =147,450,097

2009 3 to 6 Months P =â&#x20AC;&#x201C;

â&#x20AC;&#x201C; â&#x20AC;&#x201C; 7,313,682 598,990,029 P =7,313,682 P =598,990,029

6 to 12 months

P =â&#x20AC;&#x201C;

Beyond 1 year Total

P =â&#x20AC;&#x201C; P =143,212,942

â&#x20AC;&#x201C; 133,682 P =133,682

â&#x20AC;&#x201C; 385,155 4,252,190 614,541,583 P =4,252,190 P =758,139,680

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Financial Liabilities Accrued expenses and other payables Capital build up

P =â&#x20AC;&#x201C; P =25,793,357 293,744,643 â&#x20AC;&#x201C; P =293,744,643 P =25,793,357

P =5,413,939 â&#x20AC;&#x201C; P =5,413,939

P =838,443 â&#x20AC;&#x201C; P =838,443

P =2,793,328 P =34,839,067 â&#x20AC;&#x201C; 293,744,643 P =2,793,328 P =328,583,710

Accrued expenses and other payables Current portion of long term debt Capital build up

On demand

1 to 3 months

P =â&#x20AC;&#x201C;

P =5,427,786

â&#x20AC;&#x201C; 228,373,811 P =228,373,811

â&#x20AC;&#x201C; â&#x20AC;&#x201C; P =5,427,786

2008 3 to 6 Months

6 to 12 months

Beyond 1 year

Total

P =1,762,273

P =6,442,994

P =2,867,046

P =16,500,099

10,400,000 â&#x20AC;&#x201C; P =12,162,273

â&#x20AC;&#x201C; â&#x20AC;&#x201C; P =6,442,994

â&#x20AC;&#x201C; â&#x20AC;&#x201C; P =2,867,046

10,400,000 228,373,811 255,273,910

Market Risk Market risk is the risk to earnings or capital arising from adverse movements in factors that affect the market value of financial instruments. The Organization focuses on the following market risk areas such as interest rate risk, equity price risk and foreign currency risk.

Interest Rate Risk The Organizationâ&#x20AC;&#x2122;s exposure to the risk for changes in market rate relates primarily to its long term debt obligations with variable interest rates. However, most of the Organizationâ&#x20AC;&#x2122;s existing debt obligations are based on fixed interest rates with relatively small component of the debts that are subject to interest rate fluctuation.

Equity price risk Equity price risk is the risk that the fair value of equity instruments decreases as the result of changes in the levels of equity indices and the value of individual stocks. The equity price risk exposure arises from the Organization's investment portfolio.

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The following table sets forth, for the period indicated, the impact of changes in PSE index (PSEi) on the Organizationâ&#x20AC;&#x2122;s equity investments:

Change in fund balance

Changes in PSEi 2009 19.97% P =51,706

19.97% (P =51,706)

2008 11.36% P =39,514

11.36% (P =39,514)

Foreign currency risk The Organizationâ&#x20AC;&#x2122;s policy is to maintain foreign currency exposure within acceptable limits and within existing regulatory guidelines.

As of December 31, 2009 and 2008, the carrying amounts of the Organizationâ&#x20AC;&#x2122;s foreign currency denominated cash in banks and short term placements amounted to US$0.31 million with peso equivalent of P =14.36 million and US$0.41 million with peso equivalent of P =19.65 million, respectively.

The following table demonstrates the sensitivity to a reasonably possible change in the Philippine peso US dollar exchange rate, with all variables held constant, of the Organizationâ&#x20AC;&#x2122;s profit after tax (due to changes in the fair value of monetary assets). There is no impact on the Organizationâ&#x20AC;&#x2122;s fund balance other than those already affecting profit or loss.

Change in fund balance

Changes in foreign exchange rate 2009 2008 +5% 5% +5% 5% P =718,362 (P =718,362) P =982,749 (P =982,749)

Capital Management The primary objectives of the Organization's capital management are to ensure that it maintains strong credit ratings and healthy capital ratios in order to support its business and to maximize Organization's value.

The Organization manages its capital structure and makes adjustments to it in the light of changes in economic conditions and the risk characteristics of its activities. No changes were made in the objectives, policies and processes from the previous years.

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The Organizationâ&#x20AC;&#x2122;s capital is composed of fund balance.

6. Cash and Cash Equivalents

This account consists of:

2009 2008 Cash in banks P =73,143,999 P =46,170,123 Petty cash fund 198,000 144,000 Short term investments 69,778,764 157,409,995

P =143,120,763 P =203,724,118

Short term investments represent thirty day cash placements which earn annual interest rates ranging from 1.88% to 4.00% and 2.90% to 7.00% in 2009 and 2008, respectively.

Included in the short term investments are US dollar currency denominated short term placements, which as of December 31, 2009 and 2008, amounts to US$0.31 million (with peso equivalent of P =14.36 million) and US$0.41 million (with peso equivalent of P =19.65 million) and earns interest at 0.75% and 0.50% per annum, respectively.

7. Financial Assets At Fair Value Through Profit or Loss

This account represents investment in shares of stock with market value of P =0.39 million and P =0.30 million as of December 31, 2009 and 2008, net of unrealized loss (gain) of P =0.08 million and (P =0.01 million), respectively.

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8. Loans and Receivables

This account consists of:

2009 2008 Loans receivable P =523,703,750 P =386,395,980 Interest receivable 9,337,378 7,434,220 Other receivable 14,546,664 7,300,728

547,587,792 401,130,928 Less allowance for credit losses 33,182,598 15,729,139

P =514,405,194 P =385,401,789

Loans receivable consist of loans granted to women who are among the economically active poor in communities with high population densities and levels of microeconomic activities.

Loans receivable earn an interest rate of 20.00% for one loan cycle or a period of six months.

Loans receivable include past due receivables amounting to P =29.99 million and P =14.97 million as of December 31, 2009 and 2008, respectively. The movements in allowance for credit losses follow:

2009 2008 Balance at beginning of year P =15,729,139 P =9,635,608 Provisions during the year (Notes 17) 17,794,521 9,942,609 Write offs during the year (341,062) (3,849,078) Balance at end of year P =33,182,598 P =15,729,139

As of December 31, 2009 and 2008, Other receivables is presented net of allowance for impairment losses amounting to P =0.86 million.

Provision for credit losses is recognized under Operating expenses in the statement of comprehensive income amount to P =17.79 million and P =9.94 million, respectively (Note 17).

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9. Prepaid Expenses and Other Current Assets

This account consists of:

2009 2008 Unused office supplies P =5,275,369 P =2,822,244 Prepaid expenses 3,700,309 1,545,544

P =8,975,678 P =4,367,788

Prepaid expense pertains to payments made in advance for premium on insurance and rental related transactions.

10. Available for Sale Investment

In 2000, the Organization, together with the other member partners of the Alliance of Philippine Partners in Enterprise Development, Inc. (APPEND) established a micro finance bank wherein the Organization fully participated as a lead partner with an initial cash investment of P =0.10 million.

As of December 31, 2009 and 2008, the Organization has total investment of P =28.60 million or 286,000 shares of stocks representing 12.79% interest in Opportunity Microfinance Bank (OMB). As of December 31, 2009 and 2008, AFS investment has carrying value of P =7.64 million, net of allowance for impairment losses amounting to P =20.96 million.

On July 21, 2008 OMB and Kauswagan Bank merged into a single banking corporation, with â&#x20AC;&#x153;Opportunity Kauswagan Bank, Inc. (A Microfinance Thrift Bank)â&#x20AC;? as its corporate name and operating under the business/style of â&#x20AC;&#x153;OK Bank (A Microfinance Thrift Bank).â&#x20AC;? As a result of the merger the adjusted percentage of ownership of KMBI over OK Bank (merged OMB and K Bank) is 8.16% equivalent to 261,947 shares at a par value of P =100 per share. The merger took effect on January 1, 2009.

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11. Property and Equipment

The composition of and movements in this account follow:

Cost Balance at beginning of year Additions Disposals Balance at end of year Accumulated depreciation Balance at beginning of year Depreciation and amortization Disposals Balance at end of year Net book value

Building and Land Improvements P =1,050,000 14,165,380 â&#x20AC;&#x201C; 15,215,380

P =9,123,820 326,428 â&#x20AC;&#x201C; 9,450,248

â&#x20AC;&#x201C; â&#x20AC;&#x201C; â&#x20AC;&#x201C; â&#x20AC;&#x201C; P =15,215,380

3,928,527 2,061,522 â&#x20AC;&#x201C; 5,990,049 P =3,460,199

Land

Building and Improvements

P =1,050,000 â&#x20AC;&#x201C; â&#x20AC;&#x201C; 1,050,000

P =9,250,648 22,250 (149,078) 9,123,820

â&#x20AC;&#x201C; â&#x20AC;&#x201C; â&#x20AC;&#x201C; â&#x20AC;&#x201C; P =1,050,000

2,363,651 1,713,954 (149,078) 3,928,527 P =5,195,293

2009 Furniture and Transportation Leasehold Equipment Equipment Improvements Total

P =15,794,022 P =4,769,252 P =7,215,227 P =37,952,321 6,098,392 2,816,375 4,215,961 27,622,536 (574,996) â&#x20AC;&#x201C; (239,500) (814,496) 21,317,418 7,585,627 11,191,688 64,760,361

10,780,431 1,390,874 4,823,230 20,923,062 3,782,232 1,237,315 1,965,720 9,046,789 (552,482) â&#x20AC;&#x201C; (232,499) (784,981) 14,010,181 2,628,189 6,556,451 29,184,870 P =7,307,237 P =4,957,438 P =4,635,237 P =35,575,491

Cost Balance at beginning of year Additions Disposals Balance at end of year Accumulated depreciation Balance at beginning of year Depreciation and amortization Disposals Balance at end of year Net book value

2008 Furniture and Transportation Equipment Equipment

P =14,217,144 P =2,006,852 2,945,542 2,762,400 (1,368,664) â&#x20AC;&#x201C; 15,794,022 4,769,252

9,161,996 711,439 2,814,850 679,435 (1,196,415) â&#x20AC;&#x201C; 10,780,431 1,390,874 P =5,013,591 P =3,378,378

Leasehold Improvements

Total

P =6,105,636 P =32,630,280 1,404,071 7,134,263 (294,480) (1,812,222) 7,215,227 37,952,321 3,942,982 16,180,068 1,174,728 6,382,967 (294,480) (1,639,973) 4,823,230 20,923,062 P =2,391,997 P =17,029,259

Depreciation is recognized in the statement of comprehensive income as follow:

Operating expense (Note 17) Administrative expense (Note 18)

2009 P =3,648,828 5,397,961 P =9,046,789

2008 P =2,206,162 4,176,805 P =6,382,967

*SGVMC114125* '

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12. Other Assets

This account consists of:

2009 2008 Security Deposits P =4,316,342 P =2,363,624 Computer software costs 256,237 539,615 Non Micro Enterprise Development (MED) assets 88,500 88,500 Other Assets 828,313 1,383,583

P =5,489,392 P =4,375,322

Security deposits pertains to the amount paid by the Organizationâ&#x20AC;&#x2122;s branches to the lessor before commencement of the lease used to recover the loss or damage of the property by tenants mishandling of property or failure to pay rent.

The movements in computer software costs follow:

2009 2008 Beginning of the year P =539,615 P =604,541 Acquisitions during the year â&#x20AC;&#x201C; 196,052 Amortization (Notes 17 and 18) (283,378) (260,978) Balance at end of year P =256,237 P =539,615

Amortization is recognized in the statement of comprehensive income as follow:

2009 2008 Operating expense (Note 17) P =125,487 P =125,035 Administrative expense (Note 18) 157,891 135,943

P =283,378 P =260,978

*SGVMC114125* 60

, ( ;

13. Accrued Expenses and Other Payables

This account consists of:

2009 2008 Accrued expenses P =15,752,576 P =8,996,942 Accounts payable 15,168,817 5,202,139 Micro insurance payable 3,353,488 2,301,018 Unearned service income 564,186 391,570

P =34,839,067 P =16,891,669

Microinsurance payable pertains to premium remittances to the Organizationâ&#x20AC;&#x2122;s chosen insurance provider for its program members. Members aging up to 63 years old are required to be enrolled in the program.

14. Capital Build Up

This represents initial membership contribution of P =200 and mandatory weekly capital build up (CBU) of P =40 per client that earn interest rate at the prevailing bank rate on savings deposits plus 1.00% per annum. Capital build up will be returned to program members when they leave the program. Interest expense on capital build up amounted to P =5.97 million and P =5.43 million (shown under â&#x20AC;&#x2DC;Financing Costâ&#x20AC;&#x2122; in the operating expenses) in 2009 and 2008, respectively (see Note 17).

15. Retirement Benefits

The Organization has an unfunded noncontributory retirement plan covering all regular employees.

*SGVMC114125* '

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The principal actuarial assumptions used in determining pension liability for the Organizationâ&#x20AC;&#x2122;s retirement plan in 2009 and 2008 are shown below:

Retirement age Average remaining working life Discount rate Future salary increases

2009 60 19 11.42% 10.00%

2008 60 26 30.17% 10.00%

2009 P =17,848,300 11,960,931 P =29,809,231

2008 P =325,400 30,470,058 P =30,795,458

2009 P =30,795,458 (986,227) P =29,809,231

2008 P =16,169,690 14,625,768 P =30,795,458

The pension liability is as follows:

Present value of unfunded obligation Unrecognized actuarial (gains) losses Net pension liability

The movements in the pension liability follow:

Balance at beginning of year Retirement expense (income) Balance at end of year

Changes in the present value of the defined benefit obligation are as follows:

Balance at beginning of year Current service cost Interest cost Actuarial gains (loss) Balance at end of year

2009 P =325,400 86,300 98,173 17,338,427 P =17,848,300

2008 P =29,322,485 11,875,540 2,430,834 (43,303,459) P =325,400

*SGVMC114125* 62

, ( ;

Total retirement expense included in operating and administrative expenses in the statement of revenue and expenses are as follows:

Current service cost Interest cost Net actuarial (gain) loss recognized during the year

2009 P =86,300 98,173 (1,170,700) (P =986,227)

2008 P =11,875,540 2,430,834 319,394 P =14,625,768

Retirement expense recognized in the statement of comprehensive income follow:

Operating expense (Note 17) Administrative expense (Note 18)

2009 P =â&#x20AC;&#x201C; (986,227) (P =986,227)

2008 P =13,445,378 1,180,390 P =14,625,768

Amounts for the current and previous year are as follows:

Present value of obligation

16. Service and Other Income

Service income consists of:

Interest on loans Membership processing fees Microinsurance fees Service fees

2009 P =17,848,300

2008 P =325,400

2009 P =301,186,172 24,478,980 24,332,580 817,649 P =350,815,381

2008 P =261,193,993 19,693,545 18,831,150 484,080 P =300,202,768

*SGVMC114125* '

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Other income consists of:

Interest income on bank deposits and short term placements Fair value gain (loss) on financial assets at FVPL Others

17. Operating Expenses

This account consists of:

Salaries and wages Employee benefits and allowances Provision for credit losses on receivables Rent (Note 20) Transportation and travel Social Security System (SSS), Medicare, ECC and Home Development Mutual Fund (HDMF) contribution Communication, light and water Financing cost Printing Supplies Depreciation and amortization (Note 11) Repairs and maintenance Fringe benefit tax Meetings, trainings and conferences Taxes and licenses Insurance Amortization of software costs (Note 12) Security services

2009

2008

P =5,576,144 82,474 1,238,742 P =6,897,360

P =6,026,689 (12,146) 1,032,834 P =7,047,377

2009 P =110,531,819 47,218,674 17,794,521 16,045,917 14,634,461

2008 P =83,937,056 37,429,298 9,942,609 12,395,533 10,617,786

10,015,295 7,836,775 6,462,569 4,896,683 4,657,314 3,648,828 2,054,642 1,652,613 863,437 783,662 709,542 125,487 36,614

7,510,300 5,700,157 7,707,611 3,215,371 3,187,948 2,206,162 1,564,805 1,656,596 885,230 683,222 540,108 125,035 44,041

*SGVMC114125* 64

, ( ;

Advertisement and promotion Donations and contributions Retirement (Note 15) Miscellaneous

7,721 5,026 â&#x20AC;&#x201C; 581,048 P =250,562,648

1,320 18,583 13,445,378 589,041 P =203,403,190

Rent expense includes P =0.19 million and P =0.30 million from escalation clauses in 2009 and 2008, respectively.

18. Administrative Expenses

This account consists of:

Salaries and wages Employee benefits and allowances Meetings, trainings and conferences Depreciation and amortization (Note 11) Transportation and travel Non MED Communication, light and water Legal, audit and other professional fees SSS, Medicare, ECC and HDMF contribution Supplies Advertisement and promotion Fringe benefit tax Printing Insurance Security services Repairs and maintenance Membership dues Donations and contributions Gasoline and oil Amortization of software cost (Note 12)

2009 P =23,292,228 20,921,732 19,047,203 5,397,961 5,395,048 2,497,250 2,127,550 1,531,117 1,274,072 1,270,245 1,225,291 1,169,134 962,512 415,843 404,681 373,681 371,382 254,159 212,459 157,891

2008 P =15,480,599 7,135,323 14,377,640 4,176,805 5,182,542 3,754,354 2,046,173 1,437,776 919,198 869,109 471,885 820,722 28,943 103,882 358,741 251,841 1,014,180 489,933 204,932 135,943

*SGVMC114125* '

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Taxes and licenses Rent Representation and entertainment Retirement (Note 15) Provision for impairment losses on AFS investments (Note 10) Miscellaneous

95,189 36,000 10,037 (986,227)

217,546 â&#x20AC;&#x201C; 22,241 1,180,390

â&#x20AC;&#x201C; 734,357 P =88,190,795

20,961,595 1,005,670 P =82,647,963

19. Related Party Transactions

Parties are considered to be related if one party has the ability, directly or indirectly, to control the operating decisions. Parties are also considered to be related if they are subjected to common control or common significant influence. Related parties may be individual or corporate entities. Transactions between related parties are based on terms similar to those offered to non related parties.

The compensation of key management personnel representing short term benefits included under â&#x20AC;&#x2DC;Salaries and wagesâ&#x20AC;&#x2122; and â&#x20AC;&#x2DC;Employee benefits and allowancesâ&#x20AC;&#x2122; in the Operating expenses and Administrative expense of the statement of comprehensive income in 2009 and 2008 amounted to P =5.15 million and P =11.64 million and P =9.16 million and P =3.87 million, respectively.

As of December 31, 2009 and 2008, significant transactions with OMB, an investee Organization, represent short term investments amounting to nil and P =4.86 million, respectively, and interest income amounting to nil and P =0.14 million in 2009 and 2008, respectively.

20. Lease Commitments

The Organization leases office spaces for its 61 branches and 42 branches in 2009 and 2008, respectively, in Luzon, Visayas, and Mindanao for a period of two to three years, with options to renew the lease. Rent expense amounting to P =16.05 million and P =12.40 million in 2009 and 2008, respectively, were included in operating expenses.

*SGVMC114125* 66

, ( ;

Future minimum lease payments on the operating lease follow:

Less than one year Between one and five years

2009 P =14,923,928 16,828,082 P =31,752,010

2008 P =3,024,385 13,363,340 P =16,387,725

21. Commitments and Contingent Liabilities

In the normal course of the Organizationâ&#x20AC;&#x2122;s operations, there are various outstanding commitments and contingent liabilities which are not reflected in the accompanying financial statements. No material losses are anticipated as a result of these transactions

22. Approval of the Release of the Financial Statements

The Organizationâ&#x20AC;&#x2122;s financial statements were approved and authorized for issue by the Organizationâ&#x20AC;&#x2122;s BOT on April 14, 2010.

*SGVMC114125* '

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BOARD OF TRUSTEES

' ` L% w 7 F @ * S F? P F 7 * N ? + F A N ? 7 F DK ? * 7 F * A;N F

Damiana D. Exiomo % .

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Atty. Servillano C. Mendoza

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Emmanuel M. De Guzman j % . j

*

Aurelio C. Llenado, Jr Corporate Treasurer

Dr. Amelia L. Gonzales 7 >

DIRECTORS

Edgardo S. Mercedes DK ; +

Liza D. Eco + ; DK ; +

Sancho A. Montaos II ' . ; L +

Vencent A. Abraham x; 7 L +

Annalie D. Concepcion *

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Carmela N. Porras W +

Rizaldy R. Duque

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Madelyn Frijillano ;* +

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