asset is acquired in a non-exchange transaction for nil or nominal consideration
the asset is initially measured at its fair value.
Depreciation on assets is charged on a straight-line basis over the useful life of
the asset.
Depreciation is charged at rates calculated to allocate cost or valuation of the
asset less any estimated residual value over its remaining useful life:
Public Infrastructures were not previously recognized in the books. The LGU
availed of the 5-year transitional provision for the recognition of the Public
Infrastructure and recognized 98.56% of the Public Infrastructure in the books
of account as of December 31, 2022. The remaining 1.44% cannot be traced
due to the loss of documents due to Typhoon Odette.
3.5 Cash and cash equivalents
Cash and cash equivalents comprise cash on hand and cash at bank, deposits on
call and 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. For the purpose of the consolidated
statement of cash flows, cash and cash equivalents consist of cash and short-
term deposits as defined above, net of outstanding bank overdrafts.
3.6 Inventories
Inventory is measured at cost upon initial recognition. To the extent that
inventory was received through non-exchange transactions (for no cost or for a
nominal cost), the cost of the inventory is its fair value at the date of acquisition.
Costs incurred in bringing each product to its present location and condition are
accounted for, as follows:
a) Raw materials: purchase cost using the weighted average cost method;
b) Finished goods and work in progress: cost of direct materials and labor
and a proportion of manufacturing overheads based on the normal
operating capacity, but excluding borrowing costs.
After initial recognition, inventory is 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
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