STATEMENT OF MANAGEMENT RESPONSIBILITY FOR
ANNUAL INCOME TAX RETURN
The management of PELODA TRANSPORT COOPERATIVE is responsible for all
information and representations contained in the Annual Income tax Return of the year ended
December 31, 2023. Management is likewise responsible for all information and
representations contained in the financial statements accompanying the (Annual Income tax
Return or Annual Information Return) covering the same reporting period. Furthermore, the
management is responsible for all information and representations contained in all the other
tax returns filed for the reporting period, including, but not limited, to the value added tax
and/or percentage tax returns, withholding tax returns, documentary stamp tax returns, and
any and all other tax returns.
In this regard, the Management affirms that the attached audited financial statements for the
year ended December 31, 2023 and the accompanying Annual Income Tax Return are in
accordance with the books and records of PELODA TRANSPORT COOPERATIVE complete
and correct in all materials respects. Management likewise affirms that:
a) The Annual Income Tax Return has been prepared in accordance with the
provisions of the National Internal Revenue Code, as amended, and pertinent tax
regulations and other issuances of the Department of Finance and the Bureau of
Internal Revenue;
b) Any disparity of figures in the submitted reports arising from the preparation of
financial statements pursuant to financial accounting standards and the
preparation of the income tax return pursuant to tax accounting rules has been
reported as reconciling items and maintained in the company’s book and records
with the requirements of Revenue Regulations No. 8-2007 and other relevant
issuances;
c) The PELODA TRANSPORT COOPERTATIVE has filed all applicable tax returns,
reports and statements required to be filled under Philippine tax laws for the
reporting period, and all taxes and other impositions shown thereon to be due and
payable have been paid for the reporting period, except those contested in good
faith.
Signature:
Geovanie Vidad
Chairman of the Board
Arman Soncio
Chief Financial Officer
EFREN M. BRAVO
Certified Public Accountant
Tel No. (084)822-7241
2nd Floor, Room 204, Deco Bldg.
Quezon St., Panabo City 8105
Mobile Phone No. 0919-249-2375
E-mail: efrenmbravocpa@yahoo.com.ph
Independent Auditor’s Report
The Members and Board of Directors
Peloda Transport Cooperative
Panabo City, Davao Del Norte
Report on the Audit of the Financial Statements
Opinion
We have audited the financial statement of Peloda Transport Cooperative (the Cooperative) which comprise
the statement of changes in equity, statutory funds and grants and donations, and cash flows statements for
the year then ended, and notes to the financial statements, including a summary of significant accounting
policies.
In our opinion, the accompanying financial statements present fairly, in all material respects, the financial
position of the cooperative as at December 31, 2023, and its financial performance and its cash flows for the
year then ended in accordance with Philippine Financial Reporting Frameworks (PFRF) for cooperatives.
Basis for Opinion
We conducted our audit in accordance with Philippine Standards on Auditing (PSAs) and Standards Auditing
System for Cooperative (SASC). Our responsibilities under those standards are further described in the auditor’s
responsibilities for the audit of the financial statements section of our report. We are independent of the
cooperative in accordance with the code of ethics for Professional Accountants in the Philippines (Code of
Ethics) together with the ethical requirements that are relevant to our audit of the financial statements in the
Philippines, and we have fulfilled our other ethical responsibilities in accordance with these requirements and
the Code of Ethics. We believe that the audit evidence we have obtained is sufficient and appropriate to provide
a basis for our opinion.
Responsibilities of Management and Those Charged with Governance for the Financial Statements
Management is responsible for the preparation and fair presentation of the financial statements in accordance
with PFRF, and such internal control as management determines is necessary to enables the preparation of
financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, management is responsible for assessing the Cooperative’s ability to
continue as going concern basis of accounting either intends to liquidate the Cooperative or to cease operations
or has no realistic alternative but to do so.
Those charged with governance are responsible for overseeing the cooperative’s financial reporting process.
Auditors Responsibility for the Audit of the Financial Statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free
from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our
opinion. Reasonable assurance is a high level of assurance, but not is a guarantee that an audit conducted in
accordance with PSAs will always detect a material misstatement when it exist. Misstatements can arise from
fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected
to influence the economic decisions of users taken on the basis of these financial statements.
As a part of an audit in accordance with PSAs, we experience professional judgment and maintain professional
skepticism throughout the audit. We also:

Identify and asses the risks of material misstatement of the financial statements, whether due to fraud
or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that
is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material
misstatement resulting from fraud is higher than for one resulting from error, as a fraud may involve
collusion, intentional omissions, misrepresentations, or the override of internal control

Obtain an understanding of internal control relevant to the audit 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 cooperatives internal control.

Evaluate the appropriateness of accounting policies used and the reasonableness of accounting
estimates and related disclosures made by management.

Concludes on the appropriateness of managements used and the ongoing concern basis of accounting,
based on the audit evidence obtained, whether a material uncertainty exist related to events or
conditions that may cast significant doubt on the Cooperatives ability to continue as a going concern. If
we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report
to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify
our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s
report. However, future events or conditions may cause the Cooperative to cease to continue as a going
concern.

Evaluate the overall presentation, structure and content of the financial statements, including the
disclosures, and whether the financial statements represent the underlying transactions and events in
a manner that achieves fair presentation.
We communicate with those charged with the governance regarding, among other matters, the planned
scope and timing of the audit and significant audit findings, including any significant deficiencies in internal
control that we identify during our audit.
Report on the other Legal and Regulatory Requirements
Report on the Supplementary Information Required Under Revenue Regulations 152010 of the Bureau of Internal Revenue
My audit was conducted for the purposes of forming an opinion on the basic financial
statements taken as a whole. The supplementary information on taxes and licenses in Note13
to the financial statements is presented for purpose of filling with the Bureau of Internal
Revenue and is not a required part of the basic financial statements. Such information has
been subjected to the auditing procedures applied in our audit of the basic financial
statements and in our opinion, is fairly stated in all material respects in relation to the basic
financial statements taken as whole.
EFREN M. BRAVO
Room04, 2nd Floor, Deco Bldg.,
Quezon St., Panabo City, Davao Del Norte
CPA Cert. No. 52164
BOA/PRC Registration No.0911 (Valid until April 30, 2024)
BIR Accreditation No. 19-002533-001-2023 (Valid until Feb 2, 2026)
CDA CEA No. 0281(Valid until March 20, 2023)
Tax Identification No. 108-190-139
PTR No._____________, January __, 2024, Panabo City
March _, 2024
PELODA TRANSPORT COOPERATIVE
NOTES TO FINANCIAL STATEMENTS
As of December 31, 2023 and 2022
(Amounts in Philippine Peso)
1. COOPERATIVE INFORMATION
The Peloda Transport Cooperative was formed as a cooperative pursuant to
cooperative laws of the Republic of the Philippines. The purpose for which this
Cooperative is organize to engage in1) Provide public transport services primarily
to members and the commuting public (land and sea/water transportation services,
and is limited to small services or businesses such as:
a) Importation, distribution and marketing of spare parts, supplies and
petroleum products in accordance with existing laws;
b) Operation of gasoline stations and transportation service centers;
c) Importation, distribution and marketing of spare parts and supplies;
d) Marketing of vehicle/drivers insurance policies
3) Promoting and advancing the economic and social status of the members, 4)
Coordinating and facilitation the activities of the cooperatives 5) Advocating for the
cause of the cooperative movements 6) Ensuring the viability of cooperatives
through the utilization of new technologies 7) Encouraging and promoting selfemployment as an engine for economic growth and poverty alleviation.
The Cooperative is exempt from payment of income and sales taxes, provided that
is transacts business only with its members and substantial portion of its net
income is returned to members in form of interest and/or patronage refund.
The Cooperative was issued a Certificate of Registration by the Cooperative
Development Authority under Registration NO. 9520-101100031517 in compliance
with the re-registration requirement of Republic Act No. 9520 otherwise known as
the “Philippine Cooperative Code of 2008”.
That the membership of this cooperative shall come from the Region XI (Davao
Region). Its principal office shall be located at Bonifacio ST., New Pandan (Pob),
City of Panabo, Davao Del Norte Region XI (Davao Region).
The Financial Statements of the Cooperative for the year ended December 31,
2023 were approved and authorized for issue by the Board of Directors on March
____, 2024.
2. BASIS OF PREPARATION AND SUMMARY OF SIGNIFICANT
ACCOUNTING POLICIES
To facilitate the understanding of the financial statements, the more significant
accounting policies and practices of the Cooperative are summarized as follows:
Basis of Preparation of Financial Statements
The Cooperative’s Financial Statements have been prepared on a historical cost
basis in the accordance with the Philippine Financial Framework for
Cooperatives.
Functional and Presentation Currency
Items included in the Cooperative’s financial statements are measured using the
currency of the primary economic environment in which the entity operates (the
“functional currency”). The financial statements are presented in Philippine Peso,
which is the Cooperative’s functional and presentation currency.
Revenue Recognition
Revenue is recognized when it is probable that the economic benefits associated
with the transaction will flow to the Cooperative and the amount of revenue can be
measure reliably, regardless of when the payment is being made. The Following
specific recognition criteria must also be met before revenue is recognized:
Other Income. Other income is recognized when the is an incidental economic
benefit, other than the usual business operations, that will flow to the cooperative
through an increase in asset or reduction in liability and that can be measured
reliably.
Membership Fees. Fees arising from collection from Cooperatives’ membersapplicants upon approval of their membership in the cooperative which is
equivalent to Php100.00. This is billed on a one-time basis.
Cash and Cash Equivalents
Cash includes cash on hand and in banks. Cash Equivalents are short-term, highly
liquid investment that are readily convertible to known amounts of cash and with
original maturities of three months or less and that are subject to an insignificant
risk of change in value.
Financial Assets Receivable
Receivables, if any, are valued at face value, net of allowance for debts and any
anticipated adjustments that will reduce the amount to its estimated realizable
value. The allowance for bad debts is determined after a study of the estimated
collectability of the receivable balances and evaluation of such factors as aging of
the accounts, collection expense of the Cooperative in relation to the particular
receivable, past and expected loss experiences and identified final accounts.
Property and Equipment
Property and Equipment are carried at cost less accumulated depreciation and
impairment in value. The cost of property and equipment consists of its purchase
price and any costs directly attributable to bringing the asset to the location and
condition necessary for it to be capable of operating in the manner intended by
management. Such cost includes the cost or replacing part of the property and
equipment if the criteria are met. When significant parts of property and equipment
are required to be replaced at intervals, the Cooperative recognizes such parts as
individual assets with specific useful lives and depreciates them accordingly. All
other repair and maintenance costs are recognized as an outright expenses in the
statement of comprehensive income.
An item of property and equipment and any significant part initially recognized is
derecognized upon disposal or when no future economic benefits are expected
from its use or disposal. Any gain or loss arising on derecognition of the asset is
included in the statement of comprehensive income when the asset is
derecognized.
The residual values, useful lives and methods of depreciation of property and
equipment are reviewed at each financial year end and adjusted prospectively, if
appropriate.
Fully depreciated property and equipment are retained in the accounts until they
are no longer in use and no further depreciation is charged to current operations.
Financial Liabilities
Financial liabilities include bank loans, trade and other payables, as well as Interest
on Share Capital and Patronage Refund Payable to the cooperative's members.
These are recognized when the Cooperative becomes a party to the contractual
agreements of the instruments. All interest related charges are recognized in the
Statements of comprehensive income under the caption Finance Costs.
Trade payables are recognized at their nominal value. Interest on Share Capital
and Patronage Refund payable are recognized as financial liabilities based on the
Cooperative's By-Laws as well as in the Cooperative Code.
Financial liabilities are derecognized from the balance sheet only when the
obligations are extinguished either through discharge, cancellation or expiration.
Impairment of Assets
The carrying amounts of the Cooperative's non-current assets are reviewed at
each balance sheet date to determine whether there is any indication of
impairment. If any such indication exists, the asset's recoverable amount is
estimated.
An impairment loss is recognized whenever the carrying amount of asset or its
cash- generating unit exceeds its recoverable amount.
Costs and Expenses
Costs and expenses, not directly attributable to capitalizable assets or projects, are
recognized and charged to operations as incurred. They when a decrease in future
economic benefit related to a decrease of an asset or an increase They are
recognized in profit or loss of a liability has arisen that can be measured reliably.
Expenses are recognized in profit and loss on the basis of systematic and rational
allocation procedures when economic benefits are expected to arise over several
accounting periods and the association with income can only be broadly or
indirectly determined; or immediately when expenditure produces no future
economic benefits or when, and to the extent that, future economic benefits do not
qualify, cease to qualify, for recognition in the Cooperative's statement of financial
position as an asset.
Accounting Estimates
The preparation of the financial statements requires management to make
judgments, estimates and assumptions that affect the application of accounting
policies and the reported amounts of assets, liabilities, revenue and expenses.
However, uncertainty about these assumptions and estimates could result in
outcomes that could require a material adjustment to the carrying amount of the
affected asset or liability in the future.
Judgments, estimates and assumptions 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.
The key assumptions concerning future and other key sources of estimation at the
financial reporting date that have a significant risk of causing a material adjustment
to the carrying amounts of assets and liabilities within the next financial year are
discussed below.
Determination of Impairment of Nonfinancial Assets. PFRS requires that an
impairment review be performed when certain impairment indicators are present.
The Cooperative assesses whether there are any indicators of impairment for all
nonfinancial assets at each financial reporting date. Determining the fair value of
nonfinancial assets require the estimation of cash flows expected to be generated
from the continued use and ultimate disposition of such assets.
While it is believed that the assumptions used in the estimation of fair values
reflected in the financial statements are appropriate and reasonable, significant
changes in these assumptions may materially affect the assessment of recoverable
values and any resulting impairment loss could have a material adverse impact on
the Cooperatives' financial performance.
The carrying values of the Cooperative's property and equipment amounted to
P58T and P73T thousand as at
and
respectively, (see Note
6).
Estimation of Useful Lives of Property and Equipment. The useful life of each
of the Cooperative's item of property, and equipment is estimated based on the
period over which asset is expected to be available use. Such estimation is based
on a collective assessment of similar business, internal technical evaluation and
experience with similar assets. The estimated useful life of each asset is reviewed
periodically and 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 asset. It is possible, however, that future financial
performance could be materially affected by changes in the amounts and timing of
recorded expenses brought about by changes in the factors mentioned above. A
reduction in the estimated useful life of any item of property, plant and equipment
would increase the recorded depreciation expense and decrease the carrying
value of property, plant and equipment.
There was no change in estimated useful lives of the Cooperative's property and
equipment in
and .
ACCOUNTS PECULIAR TO COOPERATIVES
The following accounts are peculiar to Cooperative due to its nature as well as
adherence to Cooperative laws, issued policies, rules and regulations, as well as
cooperative principles and practices:
ASSETS:
Cash in Cooperative Federation refers to money deposited in federations which
are unrestricted and readily available when needed. These are treated as cash and
other cash equivalents.
Cooperative Development Cost - refers to expenses incurred prior to the actual
operations of the cooperative. These are recognized at cost, subject to
amortization for a period not exceeding 3 years.
Other Funds and Deposits - refers to restricted funds set aside for funding of
reserves (Statutory and Other Reserves) established by the cooperative such as
Retirement, Mutual Benefit and other Funds. This is recorded at cost.
LIABILITIES:
Interest on Share Capital Payable - refers to the liability of the cooperative to its
members for interest on share capital, which can be determined only at the end of
every fiscal year.
Patronage Refund Payable - is the liability of the cooperative to its members and
patrons for patronage refund, which can be determined only at the end of every
fiscal year.
Due to Union/Federation (CETF) - is an amount set aside for the education and
training fund of an apex organization, which is 50% of the amount allocated by the
cooperative in accordance with the provision of the cooperative's by laws and the
cooperative code. The apex organization may either be a federation or union of
which the cooperative is a member.
Revolving Capital Payable - is a deferred payment of interest on share capital and
patronage refund whose payment has been withheld, which should be agreed upon
in the General Assembly.
Project Subsidy Fund Payable - Unused portion of the donation/grant for training,
salaries & wages.
Mutual Benefit and Other Funds Payable - are funds for special purposes such as
members welfare & benefits, i.e., loan protection, hospitalization, death,
scholarship assistance, etc. Including KBGF/CGF, provision for accidents not
taken from net surplus.
EQUITY
Donations/Grants - are amounts received by the cooperative as awards, subsidies,
grants, aids and others. This shall not be available for distribution as interest on
share capital and patronage refund, and shall form part of the members' equity of
the Statement of Financial Condition.
Statutory Funds are Mandatory funds established/set up in accordance with
Articles 86 and 87 of the Cooperative Code. They are as follows:
Reserve Fund - amounts set aside annually for the stability of the cooperative and
to meet net losses in its operations. It is equivalent to at least 10% of the net
surplus. A corresponding fund should be set up either in the form of the time deposit
with local banks or government securities. Only the amount in excess of the paid
up share capital may be used for the expansion and authorized investment of the
cooperative as provided for in its by-laws.
Education and Training Fund - an amount retained by the cooperative out of the
mandatory allocation as stipulated in the cooperative's by-laws.
Community Development Fund - This is computed at 3% of cooperative's net
surplus. This is used for projects or activities that will benefit the community where
the cooperative operates.
Optional Fund - fund set aside from the net surplus (should not exceed 7%) for
future use such as land and building, community developments, etc.
EXPENSES
General Assembly Meeting expenses incurred in the conduct of regular/special
general assemblies.
Member's Benefit - all expenses incurred for the benefit of the members.
Affiliation Fee - Amount incurred to cover membership or registration fees and
annual dues to a federation or union.
Social and Community Service expenses incurred by the cooperative in its social
community involvement including solicitations and donations to charitable
institutions.
Provision for CGF (KBGF) - amount set up for the provision of CGF (KBGF).
Provision for Members' Future Benefits - amount set up for future benefit of
members, such as pension of members, etc. not taken from Net Surplus.
OTHER ITEMS
Project Subsidy - refers to the amount deducted from Project subsidy fund to
subsidize project expense. This shall appear in the statement of operation as a
contra account to Subsidized Project Expenses.
Donation and Grant Subsidy - refers to an amount deducted from Donation and
Grants account to subsidize depreciation funded by donations and grants.
Optional Fund Subsidy refers to an amount deducted from Optional Fund to
subsidize depreciation funded by Optional Fund and/or community development
expense.
Subsidized Project Expenses - refers to a portion of the Project Subsidy Fund
expended for training, salaries and wages and other activities subsidized by
donations and grants.
INCOME TAXES
The Cooperative Code states that a Cooperative transacting business only with its
members is exempt from all government taxes, and therefore cannot apply the PAS
for income taxes because of its tax-exempt nature. However, should the
cooperative exceed the limits as set forth in the cooperative code, it will adopt the
accounting standards for income taxes as stated in PAS 12.
INCOME RECOGNITION
As a rule, cooperative adopt the accrual basis of accounting. However, for credit
and other cooperatives, recognition of revenues is on a modified accrual basis; i.e.,
interest income, fines, penalties and surcharges shall be recognized when earned
and actually collected. This is so because only interest income, fines, penalties and
surcharges on loans receivables that have been realized (i.e., earned and
collected) shall be the basis of the income available for distribution to its members
through interest on share capital and patronage refund.
Also, due to the cash-based income distribution scheme of a cooperative as well
the inherent limitations of small-scale countryside credit cooperatives, it cannot
adopt the effective interest method.
Above accounts are currently used in compliance with Cooperative laws except for
those which are inapplicable to the Cooperative's current operation.
3. MANAGEMENT'S SIGNIFICANT ACCOUNTING JUDGEMENT ESTIMATES
3.1 Judgments
The preparation of the Cooperative's financial statements in conformity with
Financial Reporting Framework (in reference to the Generally Accepted
Accounting Principles Philippines) requires management to make estimates and
assumptions that affect the of the amounts reported in the Cooperative's financial
statements and accompanying notes. The estimates and assumptions used in the
Cooperative's financial statements are based upon management's evaluation of
relevant facts and circumstances as of the date of the Cooperative's financial
statements. Actual results could differ from such estimates, 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.
3.2 Estimates
In the application of the Cooperative's accounting policies, management is required
to make judgments, estimates and assumptions about the carrying amounts of
assets and liabilities that are not readily apparent from other sources. The
estimates and associated assumptions are based on historical experiences and
other factors that are considered to be relevant. Actual results may differ from these
estimates. The estimates and underlying assumptions are reviewed on an ongoing
basis. Revisions to accounting estimates are recognized in the period in which the
estimates are revised if the revision affects only that period, or in the period of the
revision and future periods if the revision affects both and future periods. The
following represents a summary of the significant estimates and judgments and
related impact and associated risks in the Cooperative's financial statements.
Impairment of Available-for-sale Financial Assets
The Cooperative follows the guidance of PAS 39 in determining when an asset is
other- than-temporarily impaired. This determination requires significant judgment.
In making this judgment, the Cooperative evaluates, among other factors, the
duration and extent to which the fair value of an investment is less than its cost,
the financial health of and near-term business outlook of the investee, including
factors such as industry and sector performance, changes in technology and
operational and financing cash flow. If the assumption made regarding the duration
that, and extent to which the fair value is less than cost, the Cooperative would
suffer an additional loss in its financial statements, representing the write down of
cost at its fair value.
Estimated Useful Lives of Property, Plant and Equipment
The Cooperative estimates the useful lives of property, plant and equipment based
on the period over which the property, plant and equipment property, expected to
be available for use. The estimated useful lives of the property, plant and
equipment 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 property, plant and equipment.
In addition, the estimation of the useful lives of property, plant and equipment 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.
A reduction in the estimated useful lives of the property, plant and equipment would
increase the recorded expenses and decrease the non-current assets.
Depreciation is computed on a straight-line method over the estimated useful lives
of the assets as follows:
Asset Type
Furniture, Fixtures & Equipment
Years
3-5
The Cooperative assesses the value of property, plant and equipment which
require the determination of future cash flows expected to be generated from the
continued use and ultimate disposition of such asset, and require the Cooperative
to make estimates and assumption that can materially affect the financial
statements. Future events could cause the Cooperative to conclude that property,
plant and equipment and other long-lived assets are impaired. Any resulting
impairment loss could have a material adverse impact on the Cooperative's
financial condition and results of operations.
The operation of the estimated future cash flows involves significant judgment and
estimations.
While the Cooperative believes that its assumptions are appropriate and
reasonable, significant changes in these assumptions may materially affect the
Cooperative's assessment of recoverable values and may lead to future additional
impairment charges.
Revenue Recognition
The Cooperative's revenue recognition policies require the use of estimates and
assumptions that may affect the reported amounts of revenues and receivables.
Differences between the amounts initially recognized and actual settlements are
taken up in the accounts upon reconciliation. However, there is no assurance that
such use of estimates may not result to material adjustments in future periods.
4.
5.
6.
7.
8.
9.
10.
The Cooperative's Constitution and By-laws explicitly provides that its net surplus
at the end of the fiscal year shall be distributed in the following manner.
a. Reserve Fund- Minimum of ten percent (10%) shall be set aside for the
reserve fund. The reserve fund shall be used for the stability of the
Cooperative and to cushion effect of possible losses in its future operation.
b. Cooperative Education and Training fund - Maximum of ten percent (10%)
for the education and training fund. Half of the amount transferred to the
education and training fund annually under this subscription maybe spent
by the Cooperative for its education and training and other purposes; while
the other half shall be credited to the cooperative education and training
fund of the apex organization of which the Cooperative is a member.
c. Community development fund - This social fund is computed at minimum of
three percent (3%) of net surplus. This is used for projects or activities that
will benefit the community where the cooperative operates.
d. Optional fund - This fund is computed at a maximum of seven percent (7%)
of net surplus. The fund is currently earmarked for the planned building
construction.
e. Interest on share capital and patronage refund - After deduction of the
statutory accounts, any remaining net surplus shall be distributed to the
Cooperative's members in the form of interest not to exceed the normal rate
of return on investments and patronage refunds. Interest on fixed deposits
shall be allocated in proportion to the patronage i.e. volumes of loan availed.
11. COMMITMENTS AND CONTINGENCIES
There were no significant commitments and contingencies involving the
Cooperative as of Balance Sheet Date.
12. SUPPLEMENTARY INFORMATION
REGULATIONS NO. 19-2011
REQUIRED
UNDER
REVENUE
On December 2011, the Bureau of Internal Revenue has issued RR no. 19-2011
prescribing the new income tax forms to be used effective calendar year 2011.
In the case of corporations using BIR Form 1702, the taxpayer is now required
to include Supplemental Information as part of its Notes to the Audited Financial
Statements, which will be attached to the income tax return, schedules and
information on taxable income and deductions taken.
The Cooperative transact business with members and non-members or the
general public.
The following are the schedules prescribed under existing revenue issuance
applicable to Cooperatives as at December 31,
:
Exempt
Sales/revenues/receipts/fees:
Interest income form loans
Service fees
Commission and Other Income
Fines, Penalties and Surcharges
Membership Fees
13. SUPPLEMENTARY INFORMATION
REGULATIONS NO. 15-2010
REQUIRED
UNDER
REVENUE
BIR Revenue Regulations No. 15-2010 became effective last December 28,
2010 and amended certain provisions of RR No. 21-2002 prescribing the
manner of compliance with any documentary and/or procedural requirements in
connection with the preparation and submission of financial statements and
income tax returns. Section 2 of RR No. 21-2002 was further amended to include
in the Notes to Audited Financial Statements information on taxes, duties and
license fees paid or accrued during the year in addition to what is mandated by
PFRS.
As a cooperative transacting with members only, the Cooperative is entitled to
the following tax exemptions and incentives provided for under Article 60 of RA
9520, as implemented by Section 7 of the Joint Rules and Regulations
Implementing Articles 60, 61 and 114 of RA No. 9520:
 Income tax on income from CDA-registered operations;
 Value-added tax on CDA-registered sales or transactions;
 Other percentage tax;
 Donor's tax on donations to duly accredited charitable, research and
educational institutions, and reinvestment to socio-economic projects
within the area of operation of the Cooperative;
 Excise tax for which it is directly liable;
 Documentary stamp tax provided, however, that the other party to the
taxable document/transaction who is not exempt shall be the one directly
liable for the tax;
 Annual registration fee of five hundred pesos (P500.00);
 All taxes on transactions with insurance companies and banks, including
but not limited to 20% final tax on interest deposits and 7.5% final income
tax on interest income derived from a depositary bank under the
expanded foreign currency deposit system.
Bellow is the additional information required by RR No. 15-2010. This
information is presented for purposes of filing with the BIR and is not a required
part of the basic financial statements.
Tax Assessments and Litigations
As at December 31,
, the Cooperative has no outstanding tax cases and
litigations and deficiency tax assessments.