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LAGUNA LAKE DEVELOPMENT AUTHORITY

STATEMENTS OF FINANCIAL POSITION

(In Philippine Peso)

Note 2018 2017

(As restated)

ASSETS

Current Assets

Cash and Cash Equivalents 4 458,442,722 504,386,396

Receivables 5 21,774,283 22,946,299

Inventories 6 2,194,630 2,078,791

Other Current Assets 8 2,319,765 2,678,940

484,731,400 532,090,426

Non-Current Assets

Property and Equipment-net 7 307,313,793 298,357,834

Other Non-Current Assets 8 36,210,962 35,352,307

343,524,755 333,710,141

TOTAL ASSETS 828,256,155 865,800,567

Current Liabilities

Financial Liabilities 9 59,506,849 111,614,685

Inter-Agency Payables 10 32,575,185 26,461,000

Other Payables 11 45,792,336 44,001,375

137,874,370 182,077,060

Non-Current Liabilities

Trust Liabilities 12 126,946,427 88,563,094

Deferred Credits/Unearned Income 13 22,202,299 23,854,247

149,148,726 112,417,341

TOTAL LIABILITIES 287,023,096 294,494,401

Net Assets (Total Assets Less Total Liabilities) 541,233,059 571,306,166

Government Equity 541,233,059 571,306,166

TOTAL NET ASSETS/EQUITY 541,233,059 571,306,166

The notes on pages 10 to 38 form part of these statements.

LIABILITIES

NET ASSETS/EQUITY

December 31, 2018 and 2017

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STATEMENTS OF FINANCIAL PERFORMANCE

For the Years Ended December 31, 2018 and 2017


Note 2018 2017

(As restated)

REVENUE

Service and Business Income 14 203,677,016 244,352,057

Other Non-operating Income 15 1,990,298 910,401

205,667,314 245,262,458

CURRENT OPERATING EXPENSES

Personnel Services 16 102,909,192 100,881,961

Maintenance and Other Operating Expenses 17 73,081,219 64,969,851

Non-cash Expenses 18 16,269,309 12,570,539

192,259,720 178,422,351

SURPLUS FROM CURRENT OPERATIONS 13,407,594 66,840,107

OTHER INCOME (EXPENSES)

Interest Income 5,694,293 5,184,755

Financial Expenses 19 (37,028) (17,039)

5,657,265 5,167,716

SURPLUS BEFORE TAX 19,064,859 72,007,823

Income Tax 4,000,526 36,452,140

NET SURPLUS FOR THE PERIOD 15,064,333 35,555,683


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STATEMENTS OF CHANGES IN NET ASSETS/EQUITY



Note

Ordinary

Shares

Preferred

Shares

Retained

Earnings Total

Balance, January 1, 2017 262,939,198 67,373,749 247,271,837 577,584,784

Changes in Net Assets/Equity for CY 2017

Issuance of Capital Stock 1,000 1,000 0 2,000

Surplus for the Year, as restated 22 0 0 35,555,683 35,555,683

Dividends 0 0 (41,836,301) (41,836,301)

Restated Balance, December 31, 2017 262,940,198 67,374,749 240,991,219 571,306,166

Changes in Net Assets/Equity for CY 2018

Adjustment (in reporting) (116) 116 0 0

Surplus for the Year 0 0 15,064,333 15,064,333

Dividends 0 0 (45,137,440) (45,137,440)

Balance, December 31, 2018 262,940,082 67,374,865 210,918,112 541,233,059


Paid-up Capital (Note 20)

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STATEMENTS OF CASH FLOWS



Note 2018 2017

(As restated)

CASH FLOWS FROM OPERATING ACTIVITIES

Cash Inflows

Collection of Income/Revenues 210,531,115 249,490,264

Collection of Receivables/Refund of Disallowances 2,063,301 2,435,259

Trust Receipts 37,977,052 66,058,999

Other Receipts 7,907,573 111,035

Total Cash Inflows 258,479,041 318,095,557

Cash Outflows

Payment of Expenses 149,532,494 169,555,877

Payment of Accounts Payable 77,847,148 37,281,261

Grant of Cash Advances 8,632,966 10,546,454

Purchase of Inventory 1,345,017 2,963,405

Other Disbursements 295,359 322,880

Total Cash Outflows 237,652,984 220,669,877

Net Cash Provided by Operating Activities 20,826,057 97,425,680

CASH FLOWS FROM INVESTING ACTIVITIES

Cash Outflows

Purchase/Construction of Property and Equipment 23,459,490 2,122,586


Net Cash Used in Investing Activities (23,459,490) (2,122,586)

CASH FLOWS FROM FINANCING ACTIVITIES

Cash Inflows

Proceeds from Issuance of Capital Stock and Other Equity Securities 0 2,000

Total Cash Inflows 0 2,000

Cash Outflows

Payment of Cash Dividends 43,310,241 48,302,443


Net Cash Used in Financing Activities (43,310,241) (48,300,443)

NET INCREASE(DECREASE) IN CASH AND CASH EQUIVALENTS (45,943,674) 47,002,651

CASH AND CASH EQUIVALENTS AT BEGINNING OF THE YEAR 504,386,396 457,383,745

CASH AND CASH EQUIVALENTS AT END OF THE YEAR 4 458,442,722 504,386,396


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STATEMENT OF COMPARISON OF BUDGET AND ACTUAL AMOUNTS


Original Final

(1)

Note

RECEIPTS

Service and Business Income 303,989,000 303,989,000 210,531,115 93,457,885

Shares, Grants and Donations 0 0 0 0

Trust Receipts 0 0 37,977,052 (37,977,052)

Collection of Receivables/ Settlement of Disallowances 0 0 2,063,301 (2,063,301)

Other Receipts 0 0 7,907,573 (7,907,573)

Unappropriated Retained Earnings 103,007,000 103,007,000 0 103,007,000

406,996,000 406,996,000 258,479,041 148,516,959

PAYMENTS

Personnel Services 25 143,830,000 121,337,000 97,904,178 23,432,822

Maintenance and Other Operating Expenses 25 147,023,000 126,097,000 139,711,778 (13,614,778)

Capital Outlay 116,143,000 116,143,000 23,459,490 92,683,510

Financial Expenses 0 0 37,028 (37,028)

Payment of Cash Dividends 0 0 43,310,241 (43,310,241)

406,996,000 363,577,000 304,422,715 59,154,285

NET RECEIPTS/(PAYMENTS) 0 43,419,000 (45,943,674) 89,362,674


For the Year Ended December 31, 2018

PARTICULARS

Budgeted Amounts Actual

Amounts on

Comparable

Basis

(2)

Difference

Final Budget

and Actual

(3) = (1) - (2)

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LAGUNA LAKE DEVELOPMENT AUTHORITY NOTES TO FINANCIAL STATEMENTS

1. CORPORATE INFORMATION

The Laguna Lake Development Authority (LLDA) was organized in 1966 by virtue of Republic Act (RA) No. 4850, as amended by Presidential Decree (PD) No. 813 issued in 1975 and Executive Order (EO) No. 927 issued in 1983. It was created as a quasi-government agency with powers and functions of a corporation.

The Authority’s mandate is to promote and accelerate the development and balanced growth of the Laguna Lake Area within the context of the national and regional plans and policies for social and economic development, and to carry out the development of the Laguna Lake Region with due regard and adequate provisions for environmental management and control, preservation of the quality of human life and ecological systems, and the prevention of undue ecological disturbances, deterioration and pollution. In 1993, the administrative supervision over LLDA was transferred from the Office of the President to the Department of Environment and Natural Resources (DENR) through E.O. No. 149. The Rationalization Plan (RP) of the Authority pursuant to EO No. 366 dated October 4, 2004 and its Implementing Rules and Regulations (IRR) dated May 11, 2005 and Memorandum Circular No. 190 has been approved per authority from the Department of Budget and Management dated June 21, 2010.

2. STATEMENT OF COMPLIANCE AND BASIS OF PREPARATION

The financial statements were prepared in compliance with the Philippine Public Sector Accounting Standards (PPSAS) prescribed for adoption by public sector entities. The financial statements were prepared on the basis of historical cost, unless stated otherwise. The Statement of Cash Flows was prepared using the direct method. The accounting policies were consistently applied to all the years presented. The financial statements are presented in Philippine Peso (P), which is also the country’s functional currency. The preparation of financial statements in compliance with the adopted PPSAS requires the use of certain accounting estimates. It also requires Management to exercise judgment in applying LLDA’s accounting policies.

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3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

3.1 Basis of Accounting The financial statements are prepared on an accrual basis in accordance with PPSAS.

3.2 Financial Instruments a. Financial assets

Initial recognition and measurement Financial assets within the scope of PPSAS 29 – Financial Instruments: Recognition and Measurement are classified as financial assets at fair value through surplus or deficit, held-to-maturity investments, loans and receivables or available-for-sale financial assets, as appropriate. LLDA determines the classification of its financial assets at initial recognition. LLDA's financial assets include cash and cash equivalents and receivables. Subsequent measurement

The subsequent measurement of financial assets depends on their classification. Loans and receivables

Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market. After initial measurement, such financial assets are subsequently measured at amortized cost using the effective interest method, less impairment. Amortized cost is calculated by taking into account any discount or premium on acquisition and fees or costs that are an integral part of the effective interest rate. Losses arising from impairment are recognized in the surplus or deficit. Derecognition LLDA derecognizes a financial asset or, where applicable, a part of a financial asset when:

The rights to receive cash flows from the financial asset have expired or are waived.

LLDA has transferred its rights to receive cash flows from the financial assets or has assumed an obligation to pay the received cash flows in full without material delay to a third party; and either: (a) LLDA has transferred substantially all the risks and rewards of ownership of the financial asset; or (b) LLDA has neither transferred nor retained substantially all the risks and

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rewards of ownership of the financial asset, but has transferred control of the asset.

Impairment of financial assets LLDA assesses at each reporting date whether there is objective evidence that a financial asset or a 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 “loss event”) and that loss event 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 the following indicators:

The debtors or a group of debtors are experiencing significant financial difficulty;

Default or delinquency in interest or principal payments;

The probability that debtors will enter bankruptcy or other financial reorganization; and

Observable data indicates a measurable decrease in estimated future cash flows (e.g. changes in arrears or economic conditions that correlate with defaults).

b. Financial liabilities

Initial recognition and measurement Financial liabilities within the scope of PPSAS 29 are classified as financial liabilities at fair value through surplus or deficit or loans and borrowings, as appropriate. LLDA determines the classification of its financial liabilities at initial recognition. All financial liabilities are recognized initially at fair value and, in the case of loans and borrowings, plus directly attributable transaction costs. LLDA’s financial liabilities include trade and other payables. Derecognition

A financial liability is derecognized when the obligation under the liability is discharged or cancelled or expires. When an existing financial liability is 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

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the difference in the respective carrying amounts is recognized in surplus or deficit.

3.3 Cash and Cash Equivalents Cash comprises cash on hand and cash in bank. Cash equivalents are short-term, highly liquid investments with an original maturity of three months or less, which are readily convertible to known amounts of cash and are subject to insignificant risk of changes in value.

3.4 Inventories

Inventories are measured at cost upon initial recognition. To the extent that inventories are received through non-exchange transactions (for no cost or for a nominal cost), the cost of the inventory is the fair value at the date of acquisition.

After initial recognition, inventories are measured at the lower of cost and net realizable value. However, to the extent that a class of inventory is distributed or deployed at no charge or for a nominal charge, that class of inventory is measured at the lower of cost and current replacement cost.

Net realizable value is the estimated selling price in the ordinary course of operations, less the estimated costs of completion and the estimated costs necessary to make the sale, exchange, or distribution.

Inventories are recognized as an expense when deployed for utilization or consumption in the ordinary course of operations of LLDA.

3.5 Property and Equipment

Recognition An item is recognized as property and equipment if it meets the characteristics and recognition criteria as a property and equipment. The characteristics of property and equipment are as follows:

tangible items;

are held for use in the production or supply of goods or services, for rental to others, or for administrative purposes; and

are expected to be used during more than one reporting period.

An item of property and equipment is recognized as an asset if:

It is probable that future economic benefits or service potential associated with the item will flow to the entity;

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The cost or fair value of the item can be measured reliably; and

The cost is at least P15,000. Measurement at recognition An item recognized as property and equipment is measured at cost.

A property and equipment acquired through non-exchange transaction is measured at its fair value as at the date of acquisition.

The cost of the property and equipment is the cash price equivalent. For property and equipment acquired through non-exchange transaction, its cost is its fair value as at recognition date. Cost includes the following:

Its purchase price, including import duties and non-refundable purchase taxes, after deducting trade discounts and rebates;

Expenditure that is directly attributable to the acquisition of the items; and

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

Measurement after recognition After recognition, all property and equipment are stated at cost less accumulated depreciation and impairment losses. When significant parts of property and equipment are required to be replaced at intervals, LLDA recognizes such parts as individual assets with specific useful lives and depreciates them accordingly. Likewise, when a major repair/replacement is done, its cost is recognized in the carrying amount of the property and equipment as a replacement if the recognition criteria are satisfied. All other repair and maintenance costs are recognized as expense in surplus or deficit as incurred. Depreciation Each part of an item of property and equipment with a cost that is significant in relation to the total cost of the item is depreciated separately. The depreciation charge for each period is recognized as expense unless it is included in the cost of another asset.

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Initial recognition of depreciation Depreciation of an asset begins when it is available for use such as when it is in the location and condition necessary for it to be capable of operating in the manner intended by management. For simplicity and to avoid proportionate computation, the depreciation is for one month if the property and equipment is available for use on or before the 15th of the month. However, if the property and equipment is available for use after the 15th of the month, depreciation is for the succeeding month. Depreciation method The straight-line method of depreciation is adopted unless another method is more appropriate for LLDA’s operation. Estimated useful life LLDA uses the following life span of property and equipment in determining the specific estimated useful life for each asset based on its experience.

Estimated Useful Life (in years)

Land Improvements 10

Building and Other Structures 30

Leased Assets Improvements 30

Furniture, Fixtures and Books 5 to 10

Machinery and Equipment 5 to 15

Transportation Equipment 5 to 7

Assigning of life to land improvements and structures depends largely on the quality or nature of materials used:

Material Useful Life Examples Concrete 30 years Benches, planters box, gazebos, path walks Semi-Concrete 20 years Masonry works, concrete hollow blocks Light Materials 5-15 years Plywood, ply board, aluminum, cogon, etc.

Residual value LLDA uses a residual value equivalent to 10 per cent (10%) of the cost of the property and equipment.

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Impairment An asset’s carrying amount is written down to its recoverable amount, or recoverable service amount, if the asset’s carrying amount is greater than its estimated recoverable amount or recoverable service amount.

Derecognition

LLDA derecognizes items of property and equipment and/or any significant part of an asset upon disposal or when no future economic benefits or service potential is expected from its continuing use. Any gain or loss arising on derecognition of the asset (calculated as the difference between the net disposal proceeds and the carrying amount of the asset) is included in the surplus or deficit.

3.6 Provisions Provisions are recognized when LLDA 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 or service potential will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation. Where LLDA expects some or all of a provision to be reimbursed, for example, under an insurance contract, the reimbursement is recognized as a separate asset only when the reimbursement is virtually certain. The expense relating to any provision is presented in the statement of financial performance net of any reimbursement. Provisions are reviewed at each reporting date, and adjusted to reflect the current best estimate. If it is no longer probable that an outflow of resources embodying economic benefits or service potential will be required to settle the obligation, the provisions are reversed. Leave Benefits Payable is computed using the constant factor prescribed by the Civil Service Commission Memorandum Circular No. 02, s. 2016. Contingent liabilities

LLDA does not recognize a contingent liability, but discloses details of any contingencies in the notes to financial statements, unless the possibility of an outflow of resources embodying economic benefits or service potential is remote.

Contingent assets

LLDA does not recognize a contingent asset, but discloses details of a possible asset whose existence is contingent on the occurrence or non-occurrence of one or more uncertain future events not wholly within the control of LLDA in the notes to financial statements.

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Contingent assets are assessed continually to ensure that developments are appropriately reflected in the financial statements. If it has become virtually certain that an inflow of economic benefits or service potential will arise and the asset’s value can be measured reliably, the asset and the related revenue are recognized in the financial statements of the period in which the change occurs.

3.7 Changes in Accounting Policies and Estimates

LLDA recognizes the effect of changes in accounting policy retrospectively. The effect of changes in accounting policy is applied prospectively if retrospective application is impractical.

LLDA recognizes the effects of changes in accounting estimates prospectively by including in surplus/deficit.

LLDA corrects material prior period errors retrospectively in the first set of financial statements authorized for issue after the discovery by:

Restating the comparative amount for prior period(s) presented in which the error occurred; or

If the error occurred before the earliest prior period presented, restating the opening balances of assets, liabilities, and net assets/equity for the earliest prior period presented.

3.8 Revenue from Non-Exchange Transactions

Recognition and Measurement of Assets from Non-Exchange Transactions

An inflow of resources from a non-exchange transaction, other than services in-kind, that meets the definition of an asset are recognized as an asset if the following criteria are met:

It is probable that the future economic benefits or service potential associated with the asset will flow to the entity; and

The fair value of the asset can be measured reliably.

An asset acquired through a non-exchange transaction is initially measured at its fair value as at the date of acquisition. Recognition of Revenue from Non-Exchange Transactions An inflow of resources from a non-exchange transaction recognized as an asset is recognized as revenue, except to the extent that a liability is also recognized in respect of the same inflow.

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As LLDA satisfies a present obligation recognized as a liability in respect of an inflow of resources from a non-exchange transaction recognized as an asset, it reduces the carrying amount of the liability recognized and recognizes an amount of revenue equal to that reduction. Measurement of Revenue from Non-Exchange Transactions Revenue from non-exchange transactions is measured at the amount of the increase in net assets recognized by LLDA, unless a corresponding liability is recognized. Fines and Penalties LLDA recognizes revenue from fines and penalties when earned and the asset recognition criteria are met. Other non-exchange revenue are recognized when it is probable that the future economic benefits or service potential associated with the asset will flow to LLDA and the fair value of the asset can be measured reliably. Gifts and Donations LLDA recognizes assets and revenue from gifts and donations when it is probable that the future economic benefits or service potential will flow to LLDA and the fair value of the assets can be measured reliably. Goods in-kind are recognized as assets when the goods are received, or if there is a binding arrangement to receive the goods. If goods in-kind are received without conditions attached, revenue is recognized immediately. If conditions are attached, a liability is recognized which is reduced, and revenue is recognized as the conditions are satisfied.

On initial recognition, gifts and donations including goods in-kind are measured at their fair value as at the date of acquisition, which are ascertained by reference to an active market, or by appraisal. An appraisal of the value of an asset is normally undertaken by a member of the valuation profession who holds a recognized and relevant professional qualification. For many assets, the fair values are ascertained by reference to quoted prices in an active and liquid market. Transfers LLDA recognizes an asset in respect of transfers when the transferred resources meet the definition of an asset and satisfy the criteria for recognition as an asset, except those arising from services in-kind. Services in-Kind Services in-kind are not recognized as asset and revenue considering the complexity of the determination and recognition of asset and revenue and the eventual recognition of expenses.

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Transfers from Other Government Entities Revenues from non-exchange transactions with other government entities and the related assets are measured at fair value and recognized upon obtaining control of the asset (cash, goods, services and property) if the transfer is free from conditions and it is probable that the economic benefits or service potential related to the asset will flow to LLDA and can be measured reliably.

3.9 Revenue from Exchange Transactions Measurement of Revenue Revenue is measured at fair value of the consideration received or receivable. Rendering of Services LLDA recognizes revenue from rendering of services by reference to the stage of completion when the outcome of the transaction can be estimated reliably. The stage of completion is measured by reference to labor hours incurred to date as a percentage of total estimated labor hours. Where the contract outcome cannot be measured reliably, revenue is recognized only to the extent that the expenses incurred are recoverable.

Interest Income Interest income is recognized as it accrues on the time proportionate basis taking into account the principal amount outstanding and the effective interest rate.

3.10 Budget Information

The annual budget is prepared on a cash basis and is published in the government website. A separate Statement of Comparison of Budget and Actual Amounts (SCBAA) is prepared since the budget and the financial statements are not prepared on comparable basis. The SCBAA is presented showing the original and final budget and the actual amounts on comparable basis to the budget. Explanatory comments are provided in the notes to the annual financial statements.

3.11 Impairment of Non-Financial Assets

Impairment of Cash-Generating Assets At each reporting date, LLDA assesses whether there is an indication that an asset may be impaired. If any indication exists, or when annual impairment testing for an asset is required, LLDA estimates the asset’s recoverable amount. An asset’s recoverable amount is the higher of an asset’s or cash-

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generating unit (CGU)’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. Where the carrying amount of an asset or the CGU 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 discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. In determining fair value less costs to sell, recent market transactions are taken into account, if available. If no such transactions can be identified, an appropriate valuation model is used. An 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, LLDA estimates the asset’s or CGU’s recoverable amount.

A previously recognized impairment loss is reversed only if there has been a change in the assumptions used to determine the asset’s recoverable amount since the last impairment loss was recognized. The reversal is limited so that the carrying amount of the asset does not exceed its recoverable amount, nor 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 surplus or deficit.

Impairment of Non-Cash-Generating Assets LLDA assesses at each reporting date whether there is an indication that a non-cash-generating asset may be impaired. If any indication exists, or when annual impairment testing for an asset is required, LLDA estimates the asset’s recoverable service amount. An asset’s recoverable service amount is the higher of the non-cash-generating asset’s fair value less costs to sell and its value in use. Where the carrying amount of an asset exceeds its recoverable service amount, the asset is considered impaired and is written down to its recoverable service amount. LLDA classifies assets as cash-generating assets when those assets are held with the primary objective of generating a commercial return. Therefore, non-cash-generating assets would be those assets from which LLDA does not intend (as its primary objective) to realize a commercial return.

3.12 Employee Benefits The employees of LLDA are members of the Government Service Insurance System (GSIS) which provides life and retirement insurance coverage.

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LLDA recognizes the undiscounted amount of short-term employee benefits, like salaries, wages, bonuses, allowance, etc., as expense unless capitalized, and as a liability after deducting the amount paid.

4. CASH AND CASH EQUIVALENTS

This account consists of the following:

2018 2017

Cash on Hand

Cash-Collecting Officers 2,426,898 1,533,936

Petty Cash 26,522 30,020

Cash in Bank-Local Currency

Savings Account 413,360,820 429,670,790

Current Account 42,628,482 73,151,650

458,442,722 504,386,396

Cash-Collecting Officers pertains to collections on hand for the day, which are deposited immediately on the next banking day. Cash in Bank Local Currency-Savings pertains to High Yield Savings Accounts with interest rates ranging from 1.400 to 1.500 per cent. These deposits do not have any restrictions and any withdrawal prior to maturity date will only cause the reversion of the account to a normal savings account. It includes fund intended for Area Water Quality Management Fund (AWQMF), a fund established under RA 9275 known as the Philippine Clean Water Act (CWA) for the maintenance and upkeep of the water bodies in a water quality management area, amounting to P86,672,953 for 2018 and P48,981,026 for 2017 (see Note 12).

5. RECEIVABLES

5.1 Loans and Receivables


2018 2017

Loans and Receivable:

Accounts Receivable-Fishpen

Owners/Occupants 78,900,891) 79,579,428)

Loans Receivable – Local Government Units 631,054) 631,054)

Loans Receivable-Others 12,701,313) 12,701,313)

92,233,258) 92,911,795)

Allowance for Impairment (77,258,616) (77,195,510)

14,974,642) 15,716,285)

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Accounts Receivable-Fishpen Owners/Occupants includes accumulated assessments for fishpen/fishcage fees and lake water use regulatory fees including surcharges. An allowance for impairment of P64.968 million was provided on receivables deemed to be uncollectible.

Loans Receivable–Local Government Units represents the LLDA counterpart funds to the Joint Livelihood Development Project with the province of Rizal and Laguna in the amount of P381,054 and P250,000, respectively, and are subject to annual interest of five per cent under Memoranda of Agreement both dated September 29, 1988. An allowance for impairment was provided for this account in the amount of P189,315. Loans Receivable-Others pertains to the loans in the amount of P12.101 million granted to the Kapitbahayan Project in 1985 under the Laguna de Bay Fishpen Development Project (LBFDP), a foreign-assisted project. The loans were for fishcage projects. The fishcage projects were subsequently abandoned after having been destroyed by a fortuitous event. An allowance for impairment was provided for the whole amount. The account also includes financial assistance granted to Concerned Employees of Laguna Lake Development Authority (CELLDA) Multi-purpose Cooperative as non-interest bearing loan of P1,000,000 authorized under Board Resolution No. 345, Series of 2007 and Corporate Operating Budget of CY 2009. The loan is to be recouped for 10 years beginning December 2015 as per Memorandum of Agreement. Payments were made in 2016 and 2017 with an aggregate amount of P400,000 or 40 per cent of the total financial assistance granted.

5.2 Aging/Analysis of Accounts Receivables

As at December 31, 2018

Total

Not Past Due

Past Due

< 30 days

30-60 days >60 days

Accounts Receivables- Fishpen Owner/ Occupants 78,900,891 0 0 0 78,900,891

Loans Receivables-Others 12,701,313 0 0 0 12,701,313

Loans Receivables-Local Government Units 631,054 0 0 0 631,054

92,233,258 0 0 0 92,233,258

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As at December 31, 2017

Total

Not Past Due

Past Due

< 30 days

30-60 days >60 days

Accounts Receivables- Fishpen Owner/ Occupants 79,579,428 0 0 0 79,579,428

Loans Receivables-Others 12,701,313 0 0 0 12,701,313

Loans Receivables-Local Government Units 631,054 0 0 0 631,054

92,911,795 0 0 0 92,911,795

5.3 Other Receivables

2018 2017

Interest Receivable 1,738,570) 1,140,627)

Receivables-Disallowances/Charges 4,654,357) 5,540,931)

Due from Officers and Employees 406,714 406,703

Other Receivables 560,578) 560,578)

7,360,219) 7,648,839)

Allowance for Impairment (560,578) (418,825)

6,799,641) 7,230,014)

Receivables-Disallowances/Charges includes claims from employees for disallowed payments as indicated in the Notices of Disallowance/Certificate of Settlement and Balances. Disallowances in the total amount of P4.430 million affirmed in COA-CAO II Decision No. 2012-129 dated August 2012 are already being settled thru salary deduction starting February 2015. On the other hand, disallowances affirmed in COA Decision No. 2015-144 dated April 16, 2015 which already matured into a Notice of Finality of Decision in the total amount of P3.604 million, are also being settled thru salary deduction beginning July 2016. Full settlement is effected for those employees who are resigning while, demand letters will be sent to resigned/retired employees. Due from Officers and Employees consists of receivables from employees/outsiders from sale of fishpen goods/harvest during the 1980s business operations and claims from accountable officers for cash shortages and from resigned/transferred officers and employees.

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6. INVENTORIES


2018 2017

Inventory Held for Consumption:

Carrying Amount, January 1 2,078,791) 1,798,153)

Additions/Acquisitions during the year 3,287,232) 14,149,307)

Expensed during the year (3,171,393) (13,868,669)

Carrying Amount, December 31 2,194,630) 2,078,791)

7. PROPERTY AND EQUIPMENT


Land & Land

Improvement

Building &

Other

Structures

Machinery &

Equipment

Transportation

Equipment

Furniture,

Fixture &

Books

Leased Assets

Improvement Total

At December 31, 2017

Cost 5,391,451 308,375,591 74,758,277 34,831,365 13,975,791 893,720 438,226,195)

Accumulated

Depreciation (1,178,100) (37,153,072) (59,502,883) (30,153,618) (11,076,340) (804,348) (139,868,361)

Carrying Amount,

as restated 4,213,351) 271,222,519) 15,255,394) 4,677,747) 2,899,451) 89,372) 298,357,834)

Year Ended December 31, 2018 Opening Carrying

Amount 4,213,351) 271,222,519) 15,255,394) 4,677,747) 2,899,451) 89,372) 298,357,834)

Additions 0) 0) 14,513,269) 10,145,150) 300,045) 0) 24,958,464)

Adjustment on Property and Equipment below capitalization threshold

Cost (25,790) (35,870) (61,660)

Accumulated Depreciation 14,113 31,666 45,779

Depreciation for

the year (107,100) (9,308,728) (4,243,358) (1,306,189) (1,021,249) 0) (15,986,624)

Closing Carrying

Amount 4,106,251) 261,913,791) 25,513,628) 13,516,708) 2,174,043) 89,372 307,313,793)

At December 31, 2018

Cost 5,391,451 308,375,591 89,245,756 44,976,515 14,239,966 893,720 463,122,999)

Accumulated

Depreciation (1,285,200) (46,461,800) (63,732,128) (31,459,807) (12,065,923) (804,348) (155,809,206)

Carrying Amount 4,106,251) 261,913,791 25,513,628 13,516,708 2,174,043 89,372) 307,313,793)

Land consists of four parcels of land located at Calauan, Laguna with a total area of 32.784 hectares. The account does not include the following LLDA properties:

a. One parcel of land with an area of 319,057 sq.m. located at Halang, Lumban turned over after the expiration of lease contract with the National Power Corporation from year 2000 to 2004. This property is a shoreland of Laguna de Bay.

b. Two parcels of land with an area of 35,815 sq.m. and 42,210 sq.m.,

respectively, turned over after the expiration of lease contract with Rizal Cement Company Inc. from years 2001 to 2007. These properties were

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acquired by virtue of the Decision of the Court of Appeals in the case of Macario de Leon rendered in Land Registration Commission (LRC) Case No. N-9187 dated February 22, 1989. It was ruled that lots 4 and 5 form part of the Laguna de Bay.

c. Lot allocated for LLDA under Proclamation No. 725 located along East

Avenue, Quezon City (more or less 3,021 sq.m.) as institutionally arranged by virtue of Memorandum of Agreement between and among the Department of Natural Resources-National Capital Region (DENR-NCR) and LLDA signed on September 28, 2009 by the parties and approved by the DENR Secretary.

8. OTHER ASSETS


2018 2017

Other Current Assets:

Advances:

Advances to Special Disbursing Officers 323,545 798,439

Advances for Payroll 3,000 17,100

326,545 815,539

Prepayments:

Prepaid Insurance 663,140 552,607

Other Prepayments 325,982 228,868

989,122 781,475

Deposits:

Guaranty Deposits 1,004,098 1,004,098

Other Deposits 0 27,828

1,004,098 1,031,926

Other Assets-Items Under Litigation 0 50,000

2,319,765 2,678,940

Other Non-Current Assets:

Project Development Fund 36,210,962 35,352,307

38,530,727 38,031,247

Prepaid Insurance pertains to the payment made to the Government Service Insurance System for the insurance premium that is valid from January to December.

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Guaranty Deposits consist mainly of refundable deposits made to various companies for the supply of gas and oil, communication and electrical equipment and other similar deposits. Other Deposits consist of the deposit on returnable containers of P27,828. Other Assets-Items Under Litigation refers to a non-interest bearing loan on the investment fund jointly shared by LLDA with the Province of Laguna and the Municipality of Paete to the First Paete Multi-Purpose Cooperative, Inc. (FPMPCI) which is supposed to be with payback period of three (3) years without interest and collateral pursuant to Board Resolution No. 13 dated November 18, 1993. However, a collection case against the above-named cooperative has been filed on July 8, 1998 docketed as Civil Case No. 290 before the Municipal Circuit Trial Court of Paete, Laguna. Status of the case was “archived”.

Project Development Fund refers to the fund created under EO 927 dated December 16, 1983. Funding is sourced from the five per cent share from fishpen fees administered directly by LLDA in the absence of a Council. (see Note 12)

9. FINANCIAL LIABILITIES

This account represents short-term payables in the normal course of operation of LLDA. It consists of payables to entities as a result of deliveries of goods and services contracted by the Authority to discharge its functions and mandate.

10. INTER-AGENCY PAYABLES


2018 2017

Due to BIR 1,558,449 1,377,392

Due to GSIS 984,745 975,653

Due to Pag-IBIG 56,212 224,991

Due to PhilHealth 93,835 85,802

Due to NGAs 5,708,243 5,708,243

Due to LGUs 24,173,701 18,088,919

32,575,185 26,461,000

Due to BIR, GSIS, Pag-IBIG and PhilHealth accounts pertain to the statutory amounts withheld by LLDA as withholding agent and/or in trust for the account of national government agencies, local government units, government-owned and/or controlled corporations and other agencies.

Due to NGAs consists mainly of the share of DENR in the collection of Air Pollution Clearances and Permits from stationary sources within the Laguna de Bay region pursuant to the Philippine Clean Air Act in 2000 and application fees for

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Environmental Compliance Certificate/Certificate of Non-Coverage (ECC/CNC) pursuant to DENR Administrative Order 2004-61 in 2004. Due to Local Government Units (LGUs) pertains to the 35 per cent share of the Laguna de Bay lakeshore LGUs on LLDA fishpen/fishcage collections pursuant to Section 3 of EO 927 and 50 per cent share of the Seven Crater Lakes of San Pablo City pursuant to LLDA Board Resolution No. 70, Series of 1998.

11. OTHER PAYABLES

Other Payables account consists of payables to the following:

2018 2017

ERDB-DENR Research and Investigation of

Janitor Fish 270,780 270,780

CELLDA Multi-purpose Cooperative 175,346 156,650

CELLDA (Membership Contribution) 110,908 133,752

Barangay Tunasan, City of Muntinlupa 0 119,520

Ernel Barrios-Technical Consultant, Laguna

Lake Primary Productivity (LPP) 66,000 66,000

FARMC (Unpaid honorarium) 45,118 30,278

Quedancor 9,267 9,555

City of Cabuyao, Laguna 0 390

Other payables 73,268 0

750,687 786,925

Dividends Payable:

Minority Stockholders 2,762,100 934,901

National Government 42,279,549 42,279,549

45,041,649 43,214,450

45,792,336 44,001,375

ERDB-DENR Research and Investigation of Janitor Fish pertains to the

Memorandum of Agreement entered into by LLDA and Ecosystems Research and

Development Bureau (ERDB) to assess the distribution, seasonal fluctuation, growth

pattern and reproduction of janitor fish in Laguna de Bay.

Barangay Tunasan, City of Muntinlupa refers to the obligation committed by LLDA as

stipulated in the Memorandum of Agreement (MOA) executed with the City

Government of Muntinlupa, Barangay Tunasan and Muntinlupa River Rehabilitation

and Protection Council (MRRPC) to implement river protection interventions,

particularly the construction and installation of trash traps in Tunasan River. The

project ended and was turned over to the City of Muntinlupa on February 8, 2017.

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Ernel Barrios – Technical Consultant, Laguna Lake Primary Productivity refers to the

services of a technical consultant that was engaged to conduct statistical evaluation

of a five-year data on the Laguna Lake Primary Productivity (LPP) of Laguna de Bay.

City of Cabuyao, Laguna refers to the MOA executed by the City Government of

Cabuyao, Local Government Unit of Barangay III and Tanduay Distillers, Inc. to

implement river protection interventions particularly the installation of a Trash Trap in

Barangay III to prevent further deterioration of the water quality of Cabuyao River.

LLDA has committed a counter-part fund of P100,000 for the construction of Trash

Trap to complement the P147,185 fund donation of Tanduay.

Other Payables consist of miscellaneous accounts such as Land Bank loan of

employees remitted thru LLDA and retention money from suppliers/contractors.

Dividends Payable – National Government (NG) pertains to the unpaid dividends due

to the NG. The increase was due to the set-up of liability for portion of cash dividends

accruing to NG that were offsetted against subscription receivables from NG starting

CY 2004 – CY 2011.

12. TRUST LIABILITIES


2018

2017

(As restated)

Project Development Fund (Note 8) 36,210,962 35,352,307

Area Water Quality Management Fund 86,672,953 48,981,026

DENR-Operational Plan for Manila Bay

Coastal Strategy 3,805,901 3,841,000

Guaranty/Security Deposits Payable 256,611 388,761

126,946,427 88,563,094

DENR-Operational Plan for Manila Bay Coastal Strategy (OPMBCS) pertains to funds transferred to LLDA as trust receipts subject to liquidation for the development of a DELFT3D software Manila Bay Hydrodynamics and Water Quality Model in line with the implementation of DENR-OPMBCS. The OPMBCS is a set of plans and programs with estimated budgets and timeframe aimed to protect the waters in Manila Bay and its tributaries (Pasig River and Laguna Lake) to ensure that they are safe from various uses. Area Water Quality Management Fund (AWQMF) is a fund established under RA 9275 known as the Philippine Clean Water Act (CWA) for the maintenance and upkeep of the water bodies in a water quality management area. Pursuant to the CWA, LLDA was designated as one water quality management area (WQMA) under the administration of LLDA in accordance with RA 4850 as amended. This fund was

29

sourced from the variable component of the Environmental Use Fee (EUF) consistent with the wastewater charge system under the CWA. The fund shall be administered by a WQMA Governing Board which shall be used for activities of the WQMA that are in direct support of the objectives authorized in the National Water Quality Action Plan for the area (see Notes 14.1 and 21).

13. DEFERRED CREDITS/UNEARNED INCOME


2018 2017

Fishpen/Fishcage Fees 16,263,066 16,942,253

Contingent Surplus 5,791,116 6,786,959

Miscellaneous Overpayments 148,117 125,035

22,202,299 23,854,247

Deferred Credits-Fishpen/Fishcage Fees is a contra account of Accounts Receivable-Fishpen Owners and Occupants which was set up starting CY 2007. Upon collection of the receivables, this account is closed and income is recognized (see Note 5).

14. SERVICE AND BUSINESS INCOME

14.1 SERVICE INCOME


2018 2017

(As restated)

Permit Fees 71,500,485 89,292,835

Fines and Penalties 50,285,992 60,449,752

Clearance and Certification Fees 37,201,270 49,932,155

Processing Fees 322,900 421,600

Other Service Income 3,054,010 2,491,470

162,364,657 202,587,812

Permit Fees consists of the following:

2018 2017

(As restated)

Permit Fees-Industries 59,176,418 63,701,223

Fishery Rental Fee 10,363,217 25,276,740

Other Permits and Licenses 1,960,850 314,872

71,500,485 89,292,835

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Permit Fees pertains substantially to Discharge Permit Fees/Environmental User Fees (EUF) under the Environmental User Fee System (EUFS) consistent with the wastewater charge system implemented under Sections 13 and 14 of RA 9275 or the Clean Water Act. The CY 2017 amount was restated to retroactively effect the establishment of AWQMF required under the Clean Water Act, which was sourced from the variable component of EUF. (see Notes 12 and 21) Fishery Rental Fees are collection from aquaculture operation in Laguna de Bay and Seven Crater Lakes of San Pablo City. With the issuance of BR No. 518 s. 2017 “Declaring a Moratorium on the Operation of Aquaculture Structures within the Laguna de Bay Region”, no registration of fishpen and fishcages was conducted for the year resulting to a decrease in collection by about 59 per cent. Fines and Penalties pertains substantially to collection of Daily Penalties (P10,000 for every day of violation) imposed on commercial/industrial establishments with water pollution cases. The total decrease in collection by approximately 17 per cent was mainly due to the discontinuance of the imposition of one (1) time penalty effective July 23, 2018 under LLDA Memorandum Order No. 2018-49. With the termination of the imposition of one-time penalty, there was a decline in the resolution of water pollution cases, thus, collection of daily penalties decreased. Clearance and Certification Fee represents collection from the issuance of LLDA Clearance, Certificate & Authentication, Result of Laboratory Analysis (ROLA) and accreditation of Pollution Control Officer (PCO). The overall decrease of 25 per cent was the result of the decrease in LLDA Clearance collection. Processing fees are charges for the processing of applications for fishpens, industries and shoreland. Other Service Income consists of land survey fee, survey of aquastructures and laboratory services rendered to clients outside LLDA for a fee.

14.2 BUSINESS INCOME


2018 2017

Seminar/Training Fees 17,629,920 16,850,646

Rent Income 4,700 0

Sales Revenue 0 4,800

Other Business Income 23,677,739 24,908,799

41,312,359 41,764,245

Seminar/Training Fees are registration fees of Pollution Control Officers (PCOs) of industries with the LDB Region generated through the trainings conducted by LLDA as part of the continuing education for LLDA PCO

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accreditation purpose. The six per cent increase is due to the increase in the number of Continuing Environmental Education Program (CEEP) and Continuing Environmental Education Seminar (CEES) participants.

Rent Income pertains to income from the rental of a portion of the cafeteria space located at the ground floor of LLDA Building. Other Business Income pertains mainly to income realized from the water abstractions from Laguna de Bay. About 99 per cent of the income comes from Manila Water Company, Inc. and Maynilad Water Services, Inc. and one per cent from various small water abstractors.

15. OTHER NON-OPERATING INCOME

Other non-operating income consists of miscellaneous income that were generated from sale of confiscated materials from the demolished aquastructures in the lake, shuttle service collections, bid documents, pollution control officer (PCO) identification cards, liquidated damages and photocopy charges.

16. PERSONNEL SERVICES


2018 2017

Salaries and Wages - Regular 66,035,667 61,352,158

Other Compensation Year-End Bonus 11,022,886 9,992,483

Other Bonuses and Allowances 5,026,380 5,144,461 Personnel Economic Relief Allowance (PERA) 4,026,727 4,100,630

Representation Allowance 1,125,000 1,125,375

Transportation Allowance 1,035,000 955,375

Clothing/Uniform Allowance 978,000 875,000

Cash Gift 853,000 857,000

Subsistence Allowance 677,450 1,013,185

Hazard Pay 0 2,530,178

Personnel Benefits Contribution Life and Retirement Insurance Contributions 7,839,160 7,322,049

Philhealth Contributions 760,960 641,388

Pag-IBIG Contributions 273,700 188,000

ECC Contributions 200,100 203,600

Other Personnel Benefits Terminal Leave Benefits 2,766,502 4,171,445

Other Personnel Benefits 288,660 409,634

102,909,192 100,881,961

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Hazard Pay pertains to benefits under RA 7305 – Magna Carta of Public Health

Workers granted to LLDA employees in ELRD and SMD which was stopped in CY

2018.

17. MAINTENANCE AND OTHER OPERATING EXPENSES


2018 2017

General Services

Security Services 12,768,233 6,380,793

Janitorial Services 2,093,093 2,038,469

Environment/Sanitary Services 784,453 840,824

Other General Services 5,260,030 4,784,316

Supplies and Materials 9,646,949 13,868,669

Professional Services 8,621,127 7,158,723

Utility 4,100,063 3,546,382

Repairs and Maintenance 4,024,848 1,872,358

Taxes, Insurance Premiums and Other Fees 2,005,298 1,634,297

Demolition Expense 1,711,460 6,825,243

Training and Scholarship 1,374,099 353,328

Communication 910,737 866,051

Traveling Expenses 608,542 671,791

Extraordinary and Miscellaneous 164,333 174,173

Other Maintenance & Operating Expenses (MOOE)

Representation Expenses 2,496,936 1,969,515

Advertising Expenses 402,314 201,734

Membership Dues and Contributions to Organizations

280,000 391,987

Rent Expenses 197,646 182,050

Printing and Binding Expenses 118,174 18,036

Subscriptions Expenses 40,541 70,382

Other Maintenance and Other Operating Expenses

15,472,343 11,120,730

73,081,219 64,969,851

General Services includes security, janitorial, environmental and other general

services. The increase was due to the gradual addition of security personnel from 24

in CY 2017 to 46 in CY 2018 to secure Shoreland areas taken over by LLDA.

Supplies and Materials account consists of office supplies, accountable forms, drugs

and medicines, laboratory, fuel and oil, textbooks and semi-expendable expenses.

33

The decrease was mainly due to the reclassification of PPE items which do not meet

the capitalization threshold of P15,000 in CY 2017.

Demolition Expenses refers to expenses incurred by LLDA in the demolition and uprooting of illegal aquastructure in the Laguna de Bay. This includes hiring service boats, workers and other related expenses incurred during the course of the demolition activities. The decrease was due to the scaled down demolition activities in CY 2018. Training and Scholarship account includes cascading of the new vision/mission and GAD orientation, trainings provided to LLDA personnel, the Board of Directors, ISO Internal Audit Team and RA 1080 license holder in compliance with the Continuing Professional Act. Taxes, Insurance Premiums and Other Fees account consists of Income tax expense, insurance expenses, fidelity bond premiums and taxes, duties and licenses. The decrease was due to the substantial decrease in income tax expense from P36.452 million in CY 2017 to P4.001 million due to lower income generated in CY 2018. Other MOOE has an increase of P4.351 million as a result of increase in participants and conduct of in-house trainings for Pollution Control Officers (PCO), conduct of Gender and Development (GAD) orientation to all LLDA employees, conduct of quarterly meetings and General Assembly for FARMC and participation in proficiency testing for the laboratory as requirement for accreditation.

18. NON-CASH EXPENSES


2018 2017

Depreciation Expenses 15,986,624 12,451,376

Impairment loss – Loans Receivable – Local Government Unit 204,857 119,163

Impairment loss – Other Deposits 77,828 0

16,269,309 12,570,539

19. FINANCIAL EXPENSES

Financial Expenses consists of bank charges and other financial charges amounting to P37,028 and P17,039 in CY 2018 and CY 2017, respectively.

34

20. PAID-UP CAPITAL

The Authority’s capital stocks are as follows:

2018 2017

Ordinary Shares, P100 par Authorized – 4,900,000 shares Issued and Fully Paid – 93,169 shares 9,316,900 9,316,900 Subscribed – 2,995,688 shares 299,568,800 299,568,800

308,885,700 308,885,700 Less: Subscription Receivable 45,945,618 45,945,502

262,940,082 262,940,198

Preference Shares, P100 par Authorized – 2,100,000 shares Issued and Fully Paid – 6,393 shares 639,300 639,300 Subscribed – 776,188 shares 77,618,800 77,618,800

78,258,100 78,258,100 Less: Subscription Receivable 10,883,235 10,883,351

67,374,865 67,374,749

Total Paid-up Capital 330,314,947 330,314,947

Out of the LLDA’s total paid-up capital of P330,314,947 as of December 31, 2018, the amount of P316,273,322 (95.75 per cent) pertains to the account of the National Government (NG), as follows:

Ordinary Preference

Issued and Fully Paid 5,820,500 620,200 6,440,700

Subscribed but not Fully Paid 280,000,000 77,000,000 357,000,000

285,820,500 77,620,200 363,440,700

Less: Subscription Receivable 36,635,283 10,532,085 47,167,368

249,185,217 67,088,115 316,273,332

21. RESTATEMENT OF ACCOUNTS

Restatement on prior year’s liability and income accounts are as follows:

December 31,

2017 (As

previously

reported)

Restatements/

Adjustments

December

31, 2017 (As

restated)

Trust Liabilities – Area Water

Quality Management Fund

(AWQMF)

0 48,981,026 48,981,026

Permit Fees – Industries 112,682,249 (48,981,026) 63,701,223

35

22. RESTATEMENT OF NET PROFIT FOR CY 2017

The net profit for CY 2017 was restated as follows:

As previously reported 84,536,709

Reclassification of the Variable Component of EUF previously

taken up as Permit Fees to Trust Liabilities – AWQMF (48,981,026)

As restated 35,555,683

23. RECONCILIATION OF NET CASH FLOWS FROM OPERATING ACTIVITIES TO

SURPLUS/(DEFICIT)

2018 2017

Cash flows from operating activities

Surplus for the Year 15,064,333 35,555,683

Non-cash Income/Expenses

Depreciation 15,986,624 12,451,376

Impairment loss 282,685 119,163

Adjustment to Semi-expendable Expenses 15,881 2,692,559

Decrease in Receivables 967,159 1,628,517

Increase in Inventories (115,839) (280,638)

Decrease/(Increase) in Other Current Assets 281,347 (657,785)

Increase/(Decrease) in Financial Liabilities (53,606,810) 16,521,939

Increase/(Decrease) in Inter-agency Payables 6,114,185 (9,283,253)

Decrease in Other Payables (36,238) (1,765,870)

Increase Other Non-current Assets (858,655) (2,351,997)

Increase in Trust Liabilities 38,383,333 46,912,442

Decrease in Deferred Credits/Unearned Income (1,651,948) (4,116,456)

Net cash flows provided by operating activities 20,826,057 97,425,680

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24. RECONCILIATION OF THE STATEMENT OF COMPARISON OF BUDGET AND

ACTUAL AMOUNTS WITH THE STATEMENT OF FINANCIAL PERFORMANCE

Income

Personnel Services

MOOE & Others

Financial Expenses

Capital Outlay

Per Statement of Comparison of Budget and Actual Amounts 210,531,115 97,904,178 183,022,019 37,028 23,459,490

Income not considered as budgetary items

Basis Differences: Overpayment of permit fees

collected in previous years and recognized as income in 2018 20,818

Adjustment on Miscellaneous Income – Liquidated Damages outrightly deducted from payment to suppliers 317,231

Expenses not considered as budgetary items:

Basis Differences:

Non-Cash Expenses

16,269,309 Reclassification Property and

Equipment to Semi-Expendable Expenses

15,883

Addition to Property and Equipment

(23,459,490)

Accrued Interest Income 492,443

Accrued Expenses 5,005,014 15,864,371

Timing Differences:

Unexpired portion of Prepaid

Insurance (663,140)

Payment of Dividends, lakeshore shares and expenses of previous years paid this year (121,157,388)

Per Statement of Financial Performance 211,361,607 102,909,192 93,351,054 37,028 0

25. CHANGES FROM ORIGINAL TO FINAL BUDGET, BUDGETARY BASIS AND

PERIOD

The changes between the original and final budget are due to: (i) Overprovision for salaries, allowances, mandatory government contributions, and

other personnel benefits for 37 positions or 70 per cent of 52 vacant positions (only 30 per cent of 52 vacant positions were approved) totaling P22.493 million; and

37

(ii) Overprovision of MOOE. The MOOE level approved by DBM considered the highest/actual audited amounts for previous years (2016 – 2017) and the effects of inflation.

Cash basis was used in the preparation and presentation of budget. The Approved Corporate Operating Budget covers Fiscal Year 2018.

26. SUPPLEMENTARY INFORMATION ON TAXES

In compliance with the requirements set forth under BIR Revenue Regulations 15-2010, hereunder are the information on taxes and license fees paid or accrued during the year:

1) Income Tax Income Tax for CY 2018 amounted to P4,000,526 based on the Net Profit before Income Tax P13,335,087.

2) Withholding Taxes:

a) Tax on compensation 5,081,568 b) Creditable withholding tax 769,425 c) Final withholding tax 2,183,216

3) Schedule of Other Taxes (National and Local)

a) Local

Community Tax Certificate 10,500

Real Property Tax 74,788 b) National

BIR Annual Registration 500

27. PENDING CASES

The Authority, as mandated by RA 4850, shall have the sole and exclusive jurisdiction over water pollution control and aquaculture cases, shoreland matters within the territorial jurisdiction of the Laguna de Bay Region, including the imposition of penalties, administrative fines and other sanctions, except as otherwise provided by special laws.

Regular elevation of certain cases in concerned government agencies is being done

by the Authority for the filing of appropriate civil action or for resolution by the government agencies in cases where establishments refuse or fail to pay adjudged fines and penalties.

38

The list of LLDA cases with the LLDA Legal and Adjudication Division as of December 31, 2018 and 2017 are as follows: As of December 31, 2018 As of December 31, 2017

No. of Cases Amount

No. of Cases Amount

Under appeal (DENR & OP) 33 14,469,000 34 14,469,000

Referred to Legal & OGCC 302 39,005,500 303 43,792,750

Dismissed cases 288 25,290,250 451 47,166,575

Pending cases* 3,555 152,073,250 3,463 153,864,250

Total 4,178 230,838,000 4,251 259,292,575

*Pending cases are those that are already docketed with the Authority’s Public Hearing Committee, a committee under the Legal and Adjudication Division of LLDA whose main function is to exercise the Authority’s quasi-judicial powers. The respondents in these cases are those establishments within the territorial jurisdiction of LLDA which have violated the rules and regulations issued by the Authority such as but not limited to water pollution cases and operating without an LLDA clearance or license. This also includes cases with resolutions to pay but most are with motions for reconsideration and appeals for reduction of payment, hence, subject for further evaluation.

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