3.6 Receivables
Receivables represent amounts collectible from various constituents, taxpayers,
other local government units, national government agencies, municipal officials
and employees arising from claims for money lent, real property taxes due the local
government unit and cash advances granted or travel and for payment of salaries,
wages, allowances, honoraria and petty operating expenses.
3.7 Inventories
Inventories were recognized and measured at cost upon initial recognition.
Inventories were recognized as an expense when issued for utilization or
consumption in the ordinary course of operation.
3.8 Prepayments and Deferred Charges
Prepayments were recorded under the asset method. Adjusting entries were
prepared at the end of the year to record the portion of the prepayment representing
the expense incurred during the current accounting period.
3.9 Investment Property
Investment Property is either a land or a building or part of a building or both, held
by the owner or a lessee under a finance lease to earn rentals or for capital
appreciation, or both.
3.10 Property, Plant, and Equipment (PPE)
PPE were recognized at cost. Cost includes the purchase price and expenditures
directly attributable to the acquisition of the asset.
After recognition, PPE were stated at cost less accumulated depreciation.
The straight-line method was adopted in the computation of depreciation over the
useful life of the asset, assigning a residual value of at least 10%. The estimated
useful life of the asset is based on the estimated useful life of PPE by classification
issued by COA. Depreciation starts on the month following the date of the
purchase. Assets acquired prior to CY 2002 were not subjected to depreciation.
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