ZERUA VIAJES INC

BALANCE SHEET
DECEMBER 31, 2022
(In Philippine Peso)

ASSETS

Current Assets
Cash (Note 4) ₱ 2,380,295
Trade Receivables (Note 5) 709,934
Prepayments (Note 7) 1,680
Total Current Assets 3,091,909

Noncurrent Asset
Deferred tax asset (Note 14) 6,696
Total Noncurrent Assets 6,696

₱ 3,098,605

LIABILITY AND EQUITY

Current liability
Accrued Expenses (Note 9) 125,390
Total current liabilities 125,390

Equity
Share Capital (Note 10) ₱ 3,000,000
Deficit (Note 10) (26,785)
Total Equity 2,973,215

₱ 3,098,605

See accompanying Notes to Financial Statements

ZERUA VIAJES INC
STATEMENT OF INCOME
FOR THE PERIOD ENDED MAY 26 TO DECEMBER 31, 2022
(In Philippine Peso)

REVENUE ₱ 709,934

COST OF SALES (Note 11) 578,202

GROSS INCOME 131,732

OPERATING EXPENSES (Note 12) 165,213

LOSS BEFORE INCOME TAX (Note 14) (33,481)

BENEFIT FROM INCOME TAX (Note 14) (6,696)

NET LOSS (26,785)

See accompanying Notes to Financial Statements

ZERUA VIAJES INC
STATEMENT OF CHANGES IN EQUITY
FOR THE PERIOD ENDED MAY 26 TO DECEMBER 31, 2022
(In Philippine Peso)

Share
Capital Deficit
(Note 10) (Note 10) Total

Balance at December 31, 2021 - - -

Paid - up capital ₱ 3,000,000 - 3,000,000

Net loss for 2022 - (26,785) (26,785)

Balance at December 31, 2022 ₱ 3,000,000 (26,785) ₱ 2,973,215

See accompanying Notes to Financial Statements

ZERUA VIAJES INC
STATEMENT OF CASH FLOWS
FOR THE PERIOD ENDED MAY 26 TO DECEMBER 31, 2022
(In Philippine Peso)

CASH FLOWS FROM OPERATING ACTIVITIES

Operating loss before income tax P (33,481)
Adjustments to reconcile pretax loss to net cash:
-
Net cash used in operating activities (33,481)
Increase in:
Trade receivables (Note 5) (709,934)
Prepayments (Note 7) (1,680)
Accrued expenses (Note 9) 125,390
Net cash used in operations (619,705)

CASH FLOWS FROM INVESTING ACTIVITY

-
Net cash used in investing activity -

CASH FLOWS FROM FINANCING ACTIVITY

Initial investment from shareholder (Note 10) 3,000,000
Net cash provided by financing activity 3,000,000

NET INCREASE IN CASH 2,380,295

CASH AT BEGINNING OF YEAR -

CASH AT END OF YEAR (Note 4) P 2,380,295

See accompanying Notes to Financial Statements

CEF SUCCESS ENTERPRISES INC
NOTES TO FINANCIAL STATEMENTS

1. Corporate Information

ZERUA VIAJES INC (the Company) is registered in the Philippines with the Securities and
Exchange Commission (SEC) on May 26, 2022 with the primary purpose to engage in conduct, and
carry on the business of general mercantile and commercial business of buying, selling, trading,
distributing, marketing on a wholesale or retails basis in so far as may be permitted by law, any form
of commodities, goods, or merchandise which may be the object of commerce.

The Company’s office is located at Unit 206 Strata Building, F Ortigas Jr. Ortigas Center Don
Antonio Pasig City NCR 1605

The Company has no employee as of December 31, 2022

The Company’s financial statements as of and for the period ended May 26 to December 31, 2022,
were approved and authorized for issue by the single stockholder on March 29, 2023

2. Summary of Significant Accounting Policies

Basis of Preparation The accompanying financial statements of the Company have been prepared
using the historical cost basis and in accordance with generally accepted accounting principles
(GAAP) in the Philippines. The financial statements are presented in Philippine Peso, the Company’s
functional and reporting currency. All values are rounded to the nearest peso except as otherwise
indicated.
PFRS for Small Entities
In March 2018, the Philippine Securities and Exchange Commission resolved to adopt PFRS for
Small Entities (the Framework) as part of its rules and regulations on financial reporting. This
Framework was developed in response to feedback of small entities that PFRS for Small and
Medium-sized Entities (PFRS for SMEs) is too complex to apply. By reducing choices for
accounting treatment, eliminating topics that are generally not relevant to small entities, simplifying
methods for recognition and measurement, and reducing disclosure requirements, the Framework
allows small entities to comply with the financial reporting requirements without undue cost or
burden.
Some of the key implications introduced by the Framework are as follows:

 For defined benefit plans, an entity is required to use the accrual approach in calculating
benefit obligations in accordance with Republic Act (RA) 7641, The Philippine Retirement
Pay Law, or company policy (if superior to RA 7641). Accrual approach is applied by
calculating the expected liability as of reporting date using the current salary of the entitled
employees and the employees’ years of service, without consideration of future changes in
salary rates and service periods.

 Investment properties can be carried either at cost or at fair value, depending on the policy
choice made by the entity.

 There is no concept of “finance lease” under the Framework. All lease receipts (payments)
are recognized as income (expense) as earned (incurred).
  Inventories are to be subsequently valued at the lower of cost and market value (i.e., the
probable selling price to willing buyers as of reporting date).

 Entities are given a policy choice of not recognizing deferred taxes in the financial
statements.

Statement of Compliance
The accompanying financial statements of the Company have been prepared in accordance with
Philippine Financial Reporting Standards for Small Entities (PFRS for SEs).

The principal accounting policies adopted in preparing the financial statements of the Company are
as follows:

Cash
Cash includes cash on hand and cash in banks.

Trade and Other Receivables

Trade and other receivables are recognized initially at transaction price and subsequently measured at
amortized cost using the effective interest method, less provision for impairment. A provision for the
impairment of accounts receivable is established when there is objective evidence that the Company
will not be able to collect all amounts due according to the original terms of receivables. The amount
of the provision is the difference between the asset’s carrying amount and the present value of
estimated future cash flows, discounted at the effective interest rate.

Inventories
Inventories are valued initially at purchase price plus directly attributable cost less discount, if any.
Inventories are stated at the lower of cost or market value. Market value represents the estimated worth
of an asset, agreed upon by the seller and the buyer exchanging it.

Other Current Assets

Other current assets include the following:

Prepayments
Prepayments include expenses already paid but not yet incurred. These are measured at cost less
impairment loss, if any.

Property and Equipment

Property and equipment are carried at cost less accumulated depreciation and any impairment loss.
Initially, an item of property and equipment is measured at its cost, which comprise its purchase price
and any directly attributable costs of bringing the asset to working condition. Subsequent expenditures
are added to the carrying amount of the office equipment when it is probable that future economic
benefits, in excess of the originally assessed standard of performance, will flow to the Company. All
other subsequent expenditures are recognized as expense in the period in which it is incurred.

Depreciation is computed using the straight-line method over the estimated useful lives of the assets.

When assets are retired or otherwise disposed of, the cost and related accumulated depreciation are
removed from the accounts and any resulting gain or loss is credited or charged to current operations.
Impairment of Assets
The carrying values of assets are reviewed for impairment when events or changes in circumstances
indicate the carrying values may not be recoverable.

If any such indication exists and where the carrying values exceeded the estimated recoverable
amount, the assets or cash-generating units are written down to their recoverable amount. The
recoverable amount of the asset is greater of the net selling price and value in use. For an asset that
does not generate largely independent cash inflows, the recoverable amount is determined for cash
generating unit for which the asset belongs. Impairment losses, if any, are recognized in the statement
of income.

If an impairment loss subsequently reverses, the carrying amount of the asset is increased to the
revised estimate of its recoverable amount, but not in excess of the amount that would have been
determined had no impairment loss been recognized for the asset in prior years. A reversal of an
impairment loss is recognized immediately in the statement of income.

Accrued Expenses
Accrued expenses are liabilities to pay for goods or services that have been received or supplied and
have been invoiced or formally agreed with the supplier. Accrued expenses are non - interest bearing
and are stated at their transaction price.

Accrued expenses are measured initially at their transaction price and are subsequently recognized at
amortized costs less settlement payments.

Share Capital
Share capital is determined using the nominal value of shares that have been issued and fully paid.

Deficit
Deficit includes all current and prior period results as disclosed in the statement of income.

Revenue Recognition
Revenue is recognized when it is probable that an economic benefit will flow to the Company and
such revenue can be measured reliably. Revenue is measured at the fair value of the consideration
received, excluding discounts, rebates, and sales taxes.

The following specific recognition criteria must also be met before revenue is recognized:

Service Income
Service income is recognized when rendered.

Cost and Expense Recognition

Cost and expenses are recognized in the statement of income upon utilization of the service or in the
date they are incurred. Finance costs are reported on an accrual basis.

Leases
The determination of whether an arrangement is, or contains a lease is based on the substance of the
arrangement at inception date.

This requires an assessment of whether the fulfillment of the arrangement is dependent on the use of
a specific asset or assets and whether 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 the 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 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) and at the date of
renewal or extension period for scenario (b).
Company as a Lessee
Leases, which do not transfer to the Company substantially all the risks and benefits of ownership of
the asset are classified as operating leases. Operating lease payments are recognized in the statements
of income on a straight-line basis over the lease term, unless either:
a. another systematic basis is representative of the time pattern of the lessee’s benefit from the leased
asset, even if the receipt of payments is not on that basis; or

b. the payments to the lessor are structured to increase in line with expected general inflation to
compensate for the lessor’s expected inflationary cost increases.

c. If payments to the lessor vary according to factors other than inflation, then condition (b) is not
met.

Income Taxes
Current
Current tax assets and liabilities for the current and prior periods are measured at the amount expected
to be recovered from or paid to the taxation authorities. The tax rates and tax laws used to compute
the amount are those that are enacted or substantively enacted at the balance sheet date.

Deferred
Deferred income tax is provided using the liability method on temporary differences at the balance
sheet date between the tax bases of assets and liabilities and their carrying amounts for financial
reporting purposes.

The carrying amount of deferred income tax assets is reviewed at each balance sheet date and reduced
to the extent that it is no longer probable that sufficient taxable profit will be available to allow all or
part of the deferred income tax asset to be utilized. Unrecognized deferred income tax assets are
reassessed at each balance sheet date and are recognized to the extent that it has become probable that
future taxable profit will allow the deferred tax asset to be recovered.

Deferred income tax assets and liabilities are recognized for all deductible temporary differences and
carry forward benefits of the excess of minimum corporate income tax (MCIT) over the regular
corporate income tax (RCIT) and net operating loss carryover (NOLCO), to the extent that it is
probable that taxable profit will be available against which the taxable temporary differences, excess
MCIT and NOLCO can be utilized. These are measured at the tax rates that are expected to apply to
 the period when the asset is realized, based on tax rates (and tax laws) that have been enacted or
substantively enacted at the balance sheet date.

Income tax relating to items recognized directly in equity is recognized in equity and not in the
statement of income.

Deferred tax assets and deferred tax liabilities are offset, if a legally enforceable right exists to set off
current tax assets against current tax liabilities and the deferred taxes relate to the same taxable entity
and the same taxation authority.

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

Where the Company expects a provision to be reimbursed, the reimbursement is recognized as a

separate asset but only when the reimbursement is virtually certain. Provisions are reviewed at each
balance sheet date and adjusted to reflect the current best estimate.

Contingencies
Contingent liabilities are not recognized in the financial statements. They are disclosed unless the
possibility of an outflow of resources embodying economic benefits is remote. A contingent asset is
not recognized in the financial statements but disclosed when an inflow of economic benefits is
probable.

Events After the Balance Sheet Date

Post-year-end events that provide additional information about the Company’s position at the balance
sheet date (adjusting events) are reflected in the financial statements. Post-year-end events that are not
adjusting events are disclosed when material.

3. Significant Accounting Judgments and Estimates

The estimates and assumptions used in the accompanying financial statements are based upon
management’s evaluation of relevant facts and circumstances as of the date of the financial statements.
Actual results could differ from such estimates.

Judgments
In the process of applying its accounting policies, management has made the following judgments,
apart from those involving estimations, which has the most significant effect on the amounts
recognized in the financial statements:

Determining Functional Currency

Based on the economic substance of the underlying circumstances relevant to the Company, the
functional currency of the Company has been determined to be the Philippine peso. The Philippine
peso is the currency of the primary economic environment in which the Company operates. It is the
currency that mainly influences the revenues and expenses of the Company.
Determining the Type of Lease - Operating Lease
The Company has lease agreement in respect of its office space. The Company evaluates whether
significant risks and rewards of ownership of the leased properties are transferred (finance lease) or
retained by the lessor (operating lease). The Company has determined, based on an evaluation of the
terms and conditions of the arrangements, that all significant risk and rewards of ownership over the
leased properties are retained by the lessor. The leases are, therefore, accounted for as operating lease.

Rent expense recognized under cost of sales and operating expenses account in the statement of
income amounted to ₱ 135,225 for the period ended May 26 to December 31, 2022 (See Notes 11 and
12).

Estimates
The key assumption concerning the future and other key sources of estimating uncertainty at the
balance sheet date that have a significant risk of causing a material adjustment to the carrying amounts
of assets and liabilities within the next financial year are discussed below.

Impairment of Inventory
The Company recognizes impairment on inventories whenever market value of inventories become
lower than cost due to damage, physical deterioration, obsolescence, changes in price levels or other
causes.

The impairment is reviewed on a monthly basis to reflect the accurate valuation in the financial
records. There is no impairment recognized for the year ended May 26 to December 31, 2022. Since
the company is utilizing a Just-in-Time Inventory Management System, there are no carrying value of
inventories as of December 31, 2022 (See Note 6).

Estimating Impairment of Financial Assets

The Company reviews its receivables at each reporting date to assess whether an allowance for
impairment should be recorded in the Company’s statements of income. In particular, judgment by
management is required in the estimation of amount and timing of future cash flows when determining
the level of allowance required. Such estimates are based on assumptions about a number of factors
and actual results may differ, resulting in future changes to the allowance.

The level of this allowance is evaluated by management on the basis of factors that affect the
collectivity of the accounts. These factors include, but are not limited to age of balances, financial
status of counterparties, payment behavior, legal opinion on recoverability in case of legal disputes
and known market factors. The Company reviews the age and status of legal disputes and known
factors. The Company reviews the age and status of receivables and identifies accounts that are to be
provided with allowance on a regular basis.

In addition to specific allowance against individual significant receivables, the Company also makes
a collective impairment allowance against exposures which, although not specifically identified as
requiring a specific allowance, have a greater risk of default than when originally granted. This
collective allowance is generally based on the age and status of the accounts.

The amount and timing of recorded expenses for any period would differ if the Company made
different judgments or utilized different estimates. An increase in allowance for impairment losses
would increase recorded expenses and decrease in net income.
Estimated Useful Lives of Property and Equipment and Intangible Asset
The Company estimates the useful lives of property and equipment and intangible asset based on the
period over which the property and equipment is expected to be available for use. The estimated useful
lives of the property and equipment and intangible asset are reviewed periodically and are updated if
expectations differ from previous estimates due to physical wear and tear, technical or commercial
obsolescence and legal or other limits on the use of the property and equipment. In addition, the
estimation of the useful lives of property and equipment and intangible asset is based on the collective
assessment of industry practice, internal technical evaluation, and experience with similar assets. It is
possible, however, that future financial performance could be materially affected by changes in the
estimates brought about by changes in factors mentioned above. The amounts and timing of recorded
expenses for any period would be affected by changes in these factors and circumstances.

There is no carrying value of property and equipment as of December 31, 2022.

A reduction in the estimated useful lives of the property and equipment and intangible assets would
increase the recorded expenses and decrease the noncurrent assets.

Depreciation and amortization are computed on a straight-line basis over their estimated useful lives
of the property and equipment and intangible assets, as follows:

No. of years
Furniture and fixtures 5
Office and operating equipment 5

Estimating Impairment of Non-Financial Assets

The Company assess at each balance sheet date whether there is an indication that the carrying amount
of all non-financial assets maybe impaired or that previously recognized impairment losses may no
longer exist or may have decreased. If any such indication exists, or when annual impairment testing
for an asset is required, the Company makes an estimate of the asset’s recoverable amount. The
Company did not recognize any impairment loss on non-financial asset for the period ended May 26
to December 31, 2022.

Realizability of Deferred Tax Assets

Deferred tax assets are established for tax benefits related to deductible temporary differences, carry
forward of unused MCIT and NOLCO.

These assets are periodically reviewed for realization. Periodic reviews cover the nature and amount
of deferred income and expense items, expected timing when assets will be used or liabilities will be
required to be reported, reliability of historical profitability of businesses expected to provide future
earnings and tax planning strategies which can be utilized to increase the likelihood that tax assets
will be realized. The Company recognized deferred tax asset amounting to ₱ 6,696 as of December
31, 2022 (See Note 14).

Estimating Contingencies
The Company evaluates legal and administrative proceedings to which it is involved based on analysis
of potential results. Management and its legal counsels do not believe that any current proceedings
will have material adverse effects on its financial position and results of operations. It is possible,
however, that future results of operations could be materially affected by changes in the estimates or
in the effectiveness of strategies relating to these proceedings. The Company has no contingent
liability as of December 31, 2022.
4. Cash
This account consists of cash deposited in local bank amounting to ₱ 2,380,295 as of December 31,
2022.
No interest income was earned for the period ended May 26 to December 31, 2022.

5. Trade Receivables

This account consists of trade receivables from clients and customers amounting to ₱ 709,934 as of
December 31, 2022.

Trade Receivables are unsecured non-interest bearing and have different credit terms based on
agreements of the parties.

No asset under this category was used as collateral to any loans or advances as of December 31,
2022.

No impairment loss was recognized under this category for the year ended December 31, 2022

6. Inventories

This account consists of travel essentials, luggage, utensils, and home essentials. as of December 31,
2022, Movement analysis of inventory are as follows:

2022
Beginning Inventory ₱ -
Purchases 461,457
Direct Labor -
Overhead (Rent expense – Direct) 116,745
Total Goods available for sale 578,202
Cost of Sales 578,202
Loss on Inventory breakage -
Ending Inventory ₱ -

Inventories charged to cost of sales for the period ended May 26 to December 31, 2022 amounted to
₱ 578,202 (See Note 10).
There was no asset under this category used as collateral to any loans or advances as of December
31, 2022.
No impairment loss was recognized under this category for the period ended May 26 to December
31, 2022.
7. Prepayments

This account consists of:

2022
Prepaid Rent (Note 12) ₱ 1,680
₱ 1,680

No asset under this category was used as collateral to any loans or advances as of December 31,
2022.

No impairment loss was recognized under this category for the period ended January 14 to December
31, 2022.

8. Property and Equipment – Net

No Depreciation expense was charged to “Operating Expenses” for the period ended May 26 to
December 31, 2022

No property and equipment were used as security or collateral for any payables or advances as of
December 31, 2022.

No impairment loss was recognized under this category for the period ended January 14 to December
31, 2022.

9. Accrued Expenses

This Account consists of:

2022
Accrued rent expense ₱ 116,745
Percentage tax payable 7,099
Expanded withholding tax payable (Note 15) 1,546
₱ 125,390

Accrued expenses include unpaid merchant fees.

10.Equity

a. Capital Management

The primary objective of the Company's capital management is to ensure the adequacy of capital
to support its business and provide returns for shareholders. The Company makes adjustments
to its capital in the light of changes in economic conditions and business objectives. No changes
were made in the objectives, policies and processes during the period ended May 26 to
December 31, 2022.

The Company's capital, which is equal to the total equity as of December 31, 2022 were as
follows:

2022
Share Capital ₱ 3,000,000
Deficit (26,785)
₱ 2,973,215

The Company is not subject to any externally imposed capital requirements.

b. Share Capital

The Company has an authorized share capital of ₱ 5,000,000 divided into 5,000,000 shares with
a par value of ₱ 1.00 per share as of December 31, 2022. The number of subscribed and paid
shares was 3,000,000 amounting to ₱ 3,000,000 as of December 31, 2022.

11.Cost of Sales
This account consists of cost of merchandise amounting to ₱ 578,202 for the period ended May 26
to December 31, 2022 (See Note 6).
Movement analyses of cost of sales are as follows:

2022
Beginning Inventory ₱ -
Purchases 461,457
Direct Labor -
Overhead 116,745
Total Goods available for sale 578,202
Ending Inventory (Note 6) -
Loss on Inventory breakage -
Ending Inventory ₱ 578,202
12. Operating Expense

This Account consists of:

2022
Consultancy Fees ₱ 88,917
Taxes and Licenses 55,316
Rent Expense 18,480
Office Supplies 2,500
₱ 165,213

Consultant and other service fees include payments to management and brand consultants.

13. Lease Commitments

The Company leases its office space for its primary business operations. The lease period is
renewable every year thereafter.

The minimum lease payments recognized as part of cost of sales and general and administrative
expense are as follows:

2022
Rentals - Cost of Sales (Note 11) 116,745
Rentals - Operating Expense (Note 12) 18,480
135,225

The Company has prepaid rent related to the above leases amounting to ₱ 1,680 as of December 31,
2022 (See Note 7).

14. Income Taxes

This account consists of deferred tax asset – NOLCO as income tax benefit amounting to ₱ 6,696
for the period ended May 26 to December 31, 2022.

a. Details of NOLCO are shown below:

Years Incurred Expiry Date Amount Used Expired Unapplied

December 31, 2022 December 31, 2025 33,481 - - 33,481
15. Other Matters

A. Impact of COVID-19 Pandemic

The COVID-19 pandemic which broke out in early 2020 resulted to nationwide mandated
lockdowns and negatively impacted the Philippine economy. Management, however, believes
that with the support of the stockholders, it can readily meet its maturing obligations and
continue as a going concern.

B. Corporate Recovery and Tax Incentives for Enterprises ACT (CREATE) Law Impact

CREATE Law was signed into law by President Rodrigo Duterte as Republic Act (RA) No.
11534 on March 26, 2021. CREATE Law seeks to reduce corporate income tax and to rationalize
the current fiscal incentives.

Starting July 1, 2020, the corporate income tax rates were reduced from 30% to 25% or 20% for
those with the net taxable income not exceeding five million and assets not exceeding one
hundred million.

Other key implications introduced by the Law are as follows:

 Effective July 1, 2020 until June 30, 2023, the Minimum Corporate Income Tax (MCIT) were
reduced from 2% to 1% of the gross income.

 Effective April 11, 2021, Improperly Accumulated Earnings Tax is repealed.

 Additional allowable deduction of ½ of labor training expense of enterprise-based trainees.

 Portion of previously recognized deferred tax assets (liabilities) derived from sources other
than Minimum Corporate Income Tax (MCIT) payments are reduced by 16.67% or 33.33%

16. Bureau of Internal Revenue (BIR) Disclosure Requirements

In addition to the disclosures mandated under PFRS for SEs, and such other standards and/or

conventions as may be adopted, companies are required by the BIR to provide in the notes to the

financial statements, certain supplementary information for the taxable period. The amounts

relating to such information may not necessarily be the same with those amounts disclosed in the

financial statements which were prepared in accordance with PFRS for SEs.

The following are the tax information required for the taxable period ended December 31, 2022:
 I. Based on Revenue Regulations (RR) No. 2-2014

A. Revenues

Regular Rate
Sales 709,934

B. Cost of Sales

Regular Rate
Cost of Sales 578,202

C. Itemized Deductions

2022
Consultancy Fees ₱ 88,917
Taxes and Licenses 55,316
Rent Expense (Note 12) 18,480
Office Supplies 2,500
₱ 165,213

II. Based on RR No. 15-2020

Withholding Taxes

Withholding Taxes consist of:

Paid Accrued 2022

Withholding Tax on Compensation ₱ - ₱ - ₱ -
Expanded Withholding Taxes ₱ 10,052 ₱ 1,546 ₱ 11,598
 Other Taxes and Licenses

Taxes and Licenses consist of:

2022
BIR Registration ₱ 30,542
SEC Registration Fee 11,390
Percentage tax expense 7,099
Business permits 4,915
Other Permits and Licenses 1,060
Brgy. Clearance 310
₱ 55,316

Tax Assessments and Cases

The Company has no deficiency tax assessments or any tax cases litigations, and/or prosecution
in courts or bodies outside the Bureau of Internal Revenue (BIR) as of December 31, 2022.

III. Based on Revenue Regulations (RR) No. 19-2021 and 34-2021

The following are required to file and submit the Related Party Transactions (RPT) Form,
together with the Annual Income Tax Return (AITR):
a. Large Taxpayers.

b. Taxpayers enjoying tax incentives, i.e. Board of Investments (BOI)-registered and

economic zone enterprises, those enjoying Income Tax Holiday (ITH) or subject to
preferential income tax rate;

c. Taxpayers reporting net operating losses for the current taxable year and the immediately
preceding two (2) consecutive taxable years; and

d. A related party, as defined under Section 3 of Revenue Regulations (RR) No. 19-2021,
which has transactions with (a), (b) or (c). For this purpose, key management personnel
(KMP), as defined under Section 3(7) of RR No. 19-2021, shall no longer be required to
file and submit the RPT Form, nor shall there be any requirement to report any transaction
between KMP and the reporting entity/parent company of the latter in the RPT Form.

Based on the foregoing, the Company does not fall under the list provided by the Bureau of
Internal Revenue (BIR) through Revenue Regulation 19-2021 and Revenue Regulation 34-
2021, hence, the Company is not required to file the BIR Form 1709 Information Return on
Related Party Transactions.