The LGUs’ maximum exposure to credit risk is represented by the carrying value of each
financial asset in the statement of financial performance. The LGU has no significant
concentration of credit risk, with exposure spread over a large number of consumers, and
is not concentrated in any particular sector or geographic area.
Cash and cash equivalents
The LGUs limit its exposure to credit risk by investing cash and cash equivalents with only
reputable financial institutions that have a sound credit rating, and within specific
guidelines set in accordance with the Sanggunian’s approved investment policy.
Consequently, the LGUs do not consider there to be any significant exposure to credit risk.
Liquidity risk
Liquidity risk is the risk of the LGUs not being able to meet its obligations as they fall due.
The LGU’s approach to managing liquidity risk is to ensure that sufficient liquidity is
available to meet its liabilities when due, without incurring unacceptable losses or risking
damage to the LGUs’ reputation.
The LGUs ensure that it has sufficient cash on demand to meet expected operating
expenses through the use of cash flow forecasts.
Note 4. Cash and Cash Equivalents
2024 2023
Cash on Hand
Cash in Local Treasury ₱ 839,269.62 561,467.13
Petty Cash 0.00 0.00
Cash in Banks - Local Currency
Cash in Banks - Local Currency, Current 66,256,115.13 127,441,219.53
Account
Cash in Banks - Local Currency, Savings 51,922,662.28 51,498,781.64
Account
Total Cash and Cash Equivalents ₱ 119,018,047.03 179,501,468.30
Cash in Local Treasury amounting to P 839,269.62 composed of cash collections at the end of
the year. This amount was deposited in the bank in January a month after the closing date.
Cash in Bank earned interest based on the bank prevailing interest rate. Short -term saving
deposits are made for varying periods, depending on the immediate cash requirements of the
LGU and earn interest rate at the respective short-term deposit rate. The LGU bank balances
include the amount of P 24,053,726.87 pesos for infrastructure projects implementation under
the 20%EDF funded projects.
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