GROUP TASK ON FINANCIAL STATEMENTS PRESENTATION

The comparative *pre-closing adjusted trial balances of Entity A on December 31,20x2 are shown below:

20x1 20x2
Accounts Dr (Cr) Dr (Cr)

Cash-Collecting Officers 30,000 30,000

Cash-Treasury/Agency Deposit, Regular 290,000 250,000
Accounts Receivable 80,000 120,000
Allowance for Impairment-A/R - (5,000)
Office Supplies Inventory - 20,000
Buildings 800,000 800,000
Accumulated Depreciation-Buildings (650,000) (680,000)
Office Equipment 340,000 660,000
Accumulated Depreciation-Equipment (180,000) (200,000)
Accounts Payable (60,000) (90,000)
Due to BIR (20,000) -
Due to GSIS (4,000) -
Due to Pag-IBIG (2,000) -
Due to Philhealth (1,000) -
Accumulated Surplus(Deficit) (160,000) (333,000)
Tax on Delivery Vans and Trucks (40,000) (50,000)
Waterworks System Fees (192,000) (240,000)
Subsidy from National Government (934,000) (1,167,000)
Salaries and Wages, Regular 303,000 380,000
PERA 16,000 20,000
Office Supplies Expense 104,000 130,000
Water Expenses 16,000 20,000
Electricity Expenses 48,000 60,000
Telephone Expenses 32,000 40,000
Janitorial Expenses 64,000 80,000
Security Expenses 80,000 100,000
Depreciation-Buildings & Other Structures 24,000 30,000
Depreciation- Machinery & Equipment 16,000 20,000
Impairment Loss-Loans & Receivables - 5,000
Totals - -

* Hint: Recall that the "Cash-Treasury/Agency Deposit, Regular" account is closed directly to the
"Accumulated Surplus (Deficit) account. In the Statement of Changes in Net Assets/Equity, this is
presented under the "Adjustment of net revenue recognized directly in net assets/equity" line item.

Additional information:

a. Entity A received NCA of P1,050,000 in 20x2. Unused NCA reverted at year-end amounted to P43,000.
b. The unbilled tax revenues were collected in cash.
c. All collections of revenues, billed and unbilled, were remitted to the National Treasury.
d. Taxes withheld in 20x2 on payments of:
- Personnel Services, P90,000
- Maintainance and Other Operating Expenses, P20,000
- Purchase of inventories, P10,000
- Purchase of office equipment, P20,000
e. Salary deductions for contributions to GSIS, PhilHealth and Pag-IBIG in 20x2 amounted to P60,000.
f. Taxes withheld and other salary deductions are aggregated and presented under the "Inter-agency Payables" line item.
g. Only the purchases of office supplies inventory affected the accounts payable in 20x2.
h. For simplicity, assume there are no basis, timing, or entity differences between "budgeted amounts" and "actual amounts
on a comparable basis". The following are relevant to the preparation of the Statement of Comparison of Budget and Actual A

Budgeted and Actual Receipts

i. Original Budgeted Receipts

The total original budgeted receipts amounts to P300,000. This is sourced from the 20x2 Budget of Expenditures and
Sources of Financing. It constitutes the projected revenue/receipts for the following:
Tax Revenue 40,000
Service and Business Income 260,000

ii. Final Budgeted Receipts

(There are no adjustments to the original budget).

iii. Actual Receipts on Comparable Basis

The total actual receipts on comparable basis amount to P250,000. This is based on the Consolidated Actual
Revenue Collections , Statement of Financial Performance, and Statement of Cash Flows. It constitutes the
actual collections/receipts from Tax Revenue and Services and Business Income that will accrue to the
General Fund and Special Account in the General Fund.

Budgeted and Actual Payments

iv. Original Budget

The original budget for payments of PS, MOOE, and CO amounts to P1,200,000. This is based on the Current Year's
Appropriations, sourced from the Statement of Appropriations, Allotments, Obligations, Disbursements and Balances.
It consists of the folowing:
Personnel Services 420,000
Maintenance and Other Operating Expenses 480,000
Capital Outlay 300,000

v. Final Budget
The final budget amounts to P1,200,000. This includes a P20,000 realignment from PS to CO.

vi. Actual Payments

The actual payments for PS, MOOE, and CO, based on the Disbursements for payment of Current Year's Obligations
(from Current Year and Continuing Appropriations) consist of the following:
Personnel Services 400,000
Maintenance and Other Operating Expenses 450,000
Capital Outlay 320,000
Requirements:

a. Prepare a comparative Statement of Financial Position showing cross-references to the notes for the following line items:
1. Receivables
2. Property, Plant and Equipment
3. Inter-agency Payables

b. Prepare a comparative Statement of Financial Performance showing cross-references to the notes for the following line item
4. Personnel Services
5. Maintenance and Other Operating Expenses
6. Non-cash Expenses

c. Prepare a comparative Statement of Changes in Net Assets/Equity.

d. Prepare the 20x2 Statement of Cash Flows.

e. Prepare the 20x2 Statement of Comparison of Budget and Actual Amounts.

f. Prepare a comparative partial notes showing the breakdowns of the cross-referenced line items.
 cy Payables" line item.

unts" and "actual amounts

ison of Budget and Actual Amounts:

Expenditures and

e Current Year's
ments and Balances.

ear's Obligations
r the following line items:

es for the following line items:

 ENTITY A
STATEMENT OF FINANCIAL POSITION
ALL FUNDS
AS AT DECEMBER 31, 20x2

Note 20x2
ASSETS
Current Assets
Cash and Cash Equivalents 30,000
Receivables 1 115,000
Inventories 20,000
Total Current Assets 165,000

Non-Current Assets
Property, Plant and Equipment 2 580,000
Total Non-Current Assets 580,000

Total Assets 745,000

LIABILITIES
Current Liabilities
Financial Liabilities 90,000
Inter-Agency Payables 3 -
Total Current Liabilities 90,000

Total Liabilities 90,000

Total Assets less Total Liabilities 655,000

NET ASSETS/EQUITY
Accumulated Surplus/(Deficit) 655,000
Total Net Assets/Equity 655,000

This statement should be read in conjunction with the accompanying notes.

20x1

30,000
80,000
-
110,000

310,000
310,000

420,000

60,000
27,000
87,000

87,000

333,000

333,000
333,000
 ENTITY A
STATEMENT OF FINANCIAL PERFORMANCE
ALL FUNDS
FOR THE YEAR ENDED DECEMBER 31, 20x2

Note 20x2
Revenue
Tax Revenue 50,000
Service and Business Income 240,000
Total Revenue 290,000

Less: Current Operating Expenses

Personnel Services 4 400,000
Maintenance and Other Operating Expenses 5 430,000
Non-Cash Expenses 6 55,000
Total Current Operating Expenses 885,000

Surplus/(Deficit) from Current Operations (595,000)

Net Financial Assistance/Subsidy 1,167,000

Surplus/(Deficit) for the period 572,000

This statement should be read in conjunction with the accompanying notes.

 20x1

40,000
192,000
232,000

319,000
344,000
40,000
703,000

(471,000)

934,000

463,000
 ENTITY A
STATEMENT OF CHANGES IN NET ASSETS/EQUITY
ALL FUNDS
FOR THE YEAR ENDED DECEMBER 31, 20x2

Accumulated
Surplus/(Deficit)
20x2
Balance at January 1 333,000
Add/(Deduct):
Changes in accounting policy -
Prior period errors -
Other adjustments -
Restated balance 333,000

Add/(Deduct):
Changes in Net Assets/Equity for the Calendar Year
Surplus/(Deficit) for the period 572,000
Adjustment of net revenue recognized directly in net assets/equity* (250,000)
Others** -

Balance at December 31 655,000

*Net revenue deposited with the National Treasury (revenue including constructive receipt of income by Foreign Based
Agencies and income remitted by agencies thru TRA)
**Direct adjustments to Net Assets/Equity which are not revenues or expenses (e.g. transfer of PPE from of the agency
to another directly charged to Accumulated Surplus/(Deficit))

This statement should be read in conjunction with the accompanying notes.

 Accumulated
Surplus/(Deficit)
20x1
160,000

-
-
-
160,000

463,000
(290,000)
-

333,000

Foreign Based

of the agency
 ENTITY A
STATEMENT OF CASH FLOWS
ALL FUNDS
FOR THE YEAR ENDED DECEMBER 31, 20x2

20x2
Cash Flows From Operating Activities
Cash Inflows
Receipt of Notice of Cash Allocation 1,210,000
Collection of Income/Revenues 250,000
Total Cash Inflows 1,460,000

Cash Outflows
Remittance to National Treasury 410,000
Payment of Expenses 640,000
Remittance of Personnel Benefit Contribution and Mandatory Deductions 67,000
Reversal of Unutilized NCA 43,000
Total Cash Outflows 1,160,000

Net Cash Provided by (Used in) Operating Activities 300,000

Cash Flows from Investing Activities

Cash Inflows
Total Cash Inflows -

Cash Outflows
Purchase/Construction of Property, Plant and Equipment 300,000
Total Cash Outflows 300,000

Net Cash Provided by (Used in) Investing Activities (300,000)

Cash Flows From Financing Activities

Cash Inflows
Total Cash Inflows -

Cash Outflows
Total Cash Outflows -

Net Cash Provided by (Used in) Financing Activities -

Increase (Decrease) in Cash and Cash Equivalents -

Effects of Exchange Rate Changes on Cash and Cash Equivalents -

Cash and Cash Equivalents, January 1 30,000

Cash and Cash Equivalents, December 31 30,000

This statement should be read in conjunction with the accompanying notes.
 ENTITY A
STATEMENT OF COMPARISON OF BUDGET AND ACTUAL AMOUNT
ALL FUNDS
FOR THE YEAR ENDED DECEMBER 31, 20x2
(in thousand pesos)

Budgeted Amounts
Particulars
Original Final

RECEIPTS
Tax Revenue 40 40
Services and Business Income 260 260
Total Receipts 300 300

PAYMENTS
Personnel Services 420 400
Maintenance and Other Operating Expenses 480 480
Capital Outlays 300 320
Total Payments 1,200 1,200

NET RECEIPTS/PAYMENTS (900) (900)

This statement should be read in conjunction with the accompanying notes.

L AMOUNT

Actual Difference
Amounts on
Final Budget
Comparable
and Actual
Basis

50 (10)
200 60
250 50

400 -
450 30
320 -
1,170 30

(920) 20
 ENTITY A
[Consolidated] Financial statements for the year ended December 31, 20x2

20x2 20x1
Note
1 Receivables
Loans and Receivable Accounts
Accounts Receivable 120,000 80,000
Allowance for Impairment-A/R (5,000) -
Total Loans and Receivable Accounts 115,000 80,000

Total Receivables 115,000 80,000

2 Property, Plant & Equipment

Buildings and Other Structures
Buildings 800,000 800,000
Accumulated Depreciation-Buildings (680,000) (650,000)
Total Buildings and Other Structures 120,000 150,000

Machinery and Equipment

Office Equipment 660,000 340,000
Accumulated Depreciation-Equipment (200,000) (180,000)
Total Machinery and Equipment 460,000 160,000

Total Property, Plant & Equipment 580,000 310,000

3 Inter-Agency Payables
Inter-Agency Payables
Due to BIR - 20,000
Due to GSIS - 4,000
Due to Pag-IBIG - 2,000
Due to Philhealth - 1,000
Total Inter-Agency Payables - 27,000

Total Inter-Agency Payables - 27,000

4 Personnel Services
Salaries and Wages
Salaries and Wages-Regular 380,000 303,000
Total Salaries and Wages 380,000 303,000

Other Compensation
PERA 20,000 16,000
Total Other Compensation 20,000 16,000

Total Personnel Services 400,000 319,000

5 Maintenance and Other Operating Expenses
Supplies and Materials Expenses
Office Supplies Expenses 130,000 104,000
Total Supplies and Materials Expenses 130,000 104,000

Utility Expenses
Water Expenses 20,000 16,000
Electricity Expenses 60,000 48,000
Total Utilily Expenses 80,000 64,000

Communication Expenses
Telephone Expenses 40,000 32,000
Total Communication Expenses 40,000 32,000

General Services
Janitorial Services 80,000 64,000
Security Services 100,000 80,000
Total General Services 180,000 144,000

Total Maintenance and Other Operating Expenses 430,000 344,000

6 Non-Cash Expenses
Depreciation
Depreciation-Buildings and Other Structures 30,000 24,000
Depreciation-Machinery and Equipment 20,000 16,000
Total Depreciation 50,000 40,000

Impairment Loss
Impairment Loss-Loans and Receivables 5,000 -
Total Impairment Loss 5,000 -

Total Non-Cash Expenses 55,000 40,000