LAGUNA LAKE DEVELOPMENT AUTHORITY STATEMENTS OF FINANCIAL POSITION December 31, 2016 and 2015 (In Philippine Peso) Note 2016 2015 ASSETS Current Assets Cash and cash equivalents 3 457,613,299 298,851,766 Receivables-net 4 24,693,979 68,496,849 Supplies inventory 5 1,798,153 2,347,478 Prepayments 6 707,457 87,904 Other current assets 7 1,084,144 1,969,310 Total current assets 485,897,032 371,753,307 Non-Current Assets Investments 8 0 20,704,673 Property, plant and equipment-net 9 307,765,680 322,156,731 Other assets 10 33,000,310 29,152,188 Total non-current assets 340,765,990 372,013,592 TOTAL ASSETS 826,663,022 743,766,899 LIABILITIES AND EQUITY Current Liabilities Payables 11 103,581,960 59,134,795 Inter-agency payables 12 35,744,253 29,191,756 Other liability accounts 13 42,025,995 38,145,324 Total current liabilities 181,352,208 126,471,875 Non-Current Liabilities Long-term liabilities 14 586,780 336,780 Deferred credits 15 30,977,682 70,075,807 Total non-current liabilities 31,564,462 70,412,587 Total Liabilities 212,916,670 196,884,462 Equity 22 613,746,352 546,882,437 TOTAL LIABILITIES AND EQUITY 826,663,022 743,766,899 See accompanying Notes to Financial Statements. 4 LAGUNA LAKE DEVELOPMENT AUTHORITY STATEMENTS OF PROFIT OR LOSS For the Years Ended December 31, 2016 and 2015 (In Philippine Peso) Note 2016 2015 OPERATING INCOME Permits and licenses 16 135,597,743 113,069,070 Service income 17 134,834,959 83,121,800 Business income 18 28,018,628 19,729,081 Other income 19 4,396,603 4,115,157 Total operating income 302,847,933 220,035,108 OPERATING EXPENSES Personnel services 20 104,314,296 92,690,247 Maintenance and other operating expenses 21 76,534,405 68,943,659 Financial expenses 27,370 19,179 Total operating expenses 180,876,071 161,653,085 INCOME FROM OPERATIONS 121,971,862 58,382,023 LOSS ON DISPOSAL OF PROPERTY 4,069,559 13,175,383 NET PROFIT BEFORE INCOME TAX 117,902,303 45,206,640 INCOME TAX EXPENSE 34,229,704 11,588,769 NET PROFIT 83,672,599 33,617,871 See accompanying Notes to Financial Statements. 5 LAGUNA LAKE DEVELOPMENT AUTHORITY STATEMENTS OF CHANGES IN EQUITY For the Years Ended December 31, 2016 and 2015 (In Philippine Peso) Paid-up Capital (Note 22) Ordinary Preferred Retained Shares Shares Earnings Total Balances, January 1, 2015 299,234,701 73,006,870 159,286,527 531,528,098 Changes in Equity in 2015 Receipt of subscriptions receivable 339,780 11,145 0 350,925 Net profit for the year 0 0 33,617,871 33,617,871 Dividends 0 0 (18,614,457) (18,614,457) Balances, December 31, 2015 299,574,481 73,018,015 174,289,941 546,882,437 Changes in Equity in 2016 Net profit for the year 0 0 83,672,599 83,672,599 Dividends 0 0 (16,808,684) (16,808,684) Balances, December 31, 2016 299,574,481 73,018,015 241,153,856 613,746,352 See accompanying Notes to Financial Statements. 6 LAGUNA LAKE DEVELOPMENT AUTHORITY STATEMENTS OF CASH FLOWS For the Years Ended December 31, 2016 and 2015 (In Philippine Peso) Note 2016 2015) CASH FLOWS FROM OPERATING ACTIVITIES Collection of income 331,107,702 205,654,808 Collection of receivables/refund of disallowances 5,523,257 18,636,711 Receipt (refund) of tender of deposits, performance/bidders bond, net 224,406 211,526 Payment of operating expenses (103,590,399) (94,074,052) Remittances to GSIS, Pag-IBIG, BIR, etc. (55,726,079) (62,568,761) Remittances to LGUs of fishpen fee share (20,016,241) (22,017,855) Payment of payables (5,250,241) (17,116,645) Return of unutilized balance of DAP to the National Government 0 (3,600,994) Net cash provided by operating activities 152,272,405 25,124,738 CASH FLOWS FROM INVESTING ACTIVITIES Proceeds of investment from HYSA 23,808,923 (20,306,176) Refund of Meralco Guaranty Bond 376,447 0 Proceeds from sale of unserviceable properties 35,000 506,000 Payment to contractors (7,923,562) (26,418,952) Capital expenditures (1,666,101) 0 Net cash provided by (used in) investing activities 14,630,707 (46,219,128) CASH FLOWS FROM FINANCING ACTIVITIES Payment of dividends (8,141,579) (23,108,865) Net cash used in financing activities (8,141,579) (23,108,865) NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS 158,761,533 (44,203,255) CASH AND CASH EQUIVALENTS AT BEGINNING OF THE YEAR 298,851,766 343,055,021 CASH AND CASH EQUIVALENTS AT END OF THE YEAR 3 457,613,299 298,851,766 See accompanying Notes to Financial Statements. 7 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 No. 4850, as amended by Presidential Decree 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. LLDA’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 create 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 EO 149. The Rationalization Plan of LLDA pursuant to EO 366 dated October 4, 2004 and its Implementing Rules and Regulations 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. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Income and Expense Recognition Income is recognized on accrual basis except for income arising from assessments for fishpen/fishcage fees from fishpen owners/occupants which is deferred until collected, as the aquaculture industry is a high-risk venture. Expenses are recognized on accrual basis, except for property/vehicles insurance, fees and registration which are recognized upon payment. Receivables Receivables are valued at their face amounts. Allowance for doubtful accounts on receivables from fishpen owners/occupants was set up in 2006 and was subsequently increased this 2016 to reflect the amount of receivables estimated to be uncollectible. 8 Supplies Inventory Cost of issued items and ending balances of supplies and materials are computed using the moving average method. Property, Plant and Equipment Property, plant and equipment are carried at cost less accumulated depreciation. Depreciation is computed using the straight-line method over the estimated useful lives of the assets, as follows: Estimated Useful Life (in years) Land Improvements 10 Building and Structures 30 Leasehold Improvements 30 Furniture and Other Equipment 10 IT Equipment and Software 5 Motor Vehicles 7 3. CASH AND CASH EQUIVALENTS This account consists of the following: 2016 2015 Cash in Bank Local Currency-Savings 367,602,880 243,295,143 Local Currency-Checking 89,417,168 53,001,747 Cash with Collecting Officers 264,388 2,404,451 Cash with Disbursing Officers 229,554 81,634 Petty Cash Fund 99,309 68,791 457,613,299 298,851,766 Cash in Bank Local Currency-Savings pertains to High Yield Savings Accounts (HYSA) with interest rates ranging from 1.200 to 1.500 per cent and with maturities of 80 to 181 days from purchase. 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. Cash with Collecting Officers pertains to collections on hand for the day which will be deposited immediately on the next banking day. 9 The overall increase in Cash and Cash Equivalents was brought about by the increase in collections and as well as the proceeds from the maturity on LLDA’s investment in treasury bills which matured last January 2016 and was subsequently deposited in a HYSA. 4. RECEIVABLES This account consists of the following: 2016) 2015) Accounts Receivable-Fishpen Owners/Occupants 80,663,805) 83,980,539) Allowance for Doubtful Accounts (64,967,987) (24,967,987) 15,695,818) 59,012,552) Loans Receivable Provinces of Rizal and Laguna 631,054) 0) Others 12,901,313) 13,101,313) Allowance for Doubtful Accounts (12,164,418) (12,101,313) 1,367,949) 1,000,000) Other Receivables 560,578) 562,577) Allowance for Doubtful Accounts (362,768) (362,768) 197,810) 199,809) ) Receivables-Disallowances/Charges 6,527,019) 7,416,015) Interest Receivable 498,617) 463,737) Due from Officers and Employees 406,766) 404,736) 7,432,402) 8,284,488) 24,693,979) 68,496,849) Accounts Receivable-Fishpen Owners/Occupants includes accumulated assessments for fishpen/fishcage fees and lake water use regulatory fees including surcharges. An allowance for doubtful accounts of P64,967,987 was provided on receivables deemed to be uncollectible. The increase in the allowance was charged against the Other Deferred Credits account, the account used in the setup of the receivables. Income is recognized only upon collection (Note 15).