Upload
rommel-royce-cadapan
View
218
Download
0
Embed Size (px)
Citation preview
8/17/2019 Proposed Financial Reporting Standards for COOPS_0
1/26
PROPOSED FINANCIALPROPOSED FINANCIALREPORTING STANDARDS FORREPORTING STANDARDS FOR
COOPERATIVESCOOPERATIVES
8/17/2019 Proposed Financial Reporting Standards for COOPS_0
2/26
RATIONALERATIONALE
SOLICIT FROM PRACTIONERSSOLICIT FROM PRACTIONERSCOMMENTS ANDCOMMENTS AND
RECOMMENDATIONS TO GUIDE THERECOMMENDATIONS TO GUIDE THE
REGULATORY AGENCY IN THEREGULATORY AGENCY IN THEFORMULATION OF REGULATIONS TOFORMULATION OF REGULATIONS TO
GOVERN THE APPLICATION OF PFRSGOVERN THE APPLICATION OF PFRSTO COOPERATIVE ENTITIESTO COOPERATIVE ENTITIES
8/17/2019 Proposed Financial Reporting Standards for COOPS_0
3/26
BACKGROUNDBACKGROUND
ARTICLE 81 OF R.A. 6938 REQUIREDARTICLE 81 OF R.A. 6938 REQUIRED
ALL COOPERATIVES BE SUBJECT TOALL COOPERATIVES BE SUBJECT TOAN ANNUAL AUDIT BY ANAN ANNUAL AUDIT BY AN
INDEPENDENT AUDITORINDEPENDENT AUDITOR
CERTIFIED PUBLIC ACCOUNTANTSCERTIFIED PUBLIC ACCOUNTANTS
ARE REQUIRED TO CONDUCT AUDITARE REQUIRED TO CONDUCT AUDIT
USING STANDARDS REQUIRED BYUSING STANDARDS REQUIRED BYTHE PROFESSIONTHE PROFESSION
8/17/2019 Proposed Financial Reporting Standards for COOPS_0
4/26
8/17/2019 Proposed Financial Reporting Standards for COOPS_0
5/26
IN THE ABSENCE OF SPECIFIC LAWS ORIN THE ABSENCE OF SPECIFIC LAWS ORREGULATION, AN AUDITOR WILL FOLLOWREGULATION, AN AUDITOR WILL FOLLOW
PHILIPPINE FINANCIAL REPORTINGPHILIPPINE FINANCIAL REPORTING
STANDARDS (PFRS), AS CALLED FOR BYSTANDARDS (PFRS), AS CALLED FOR BYTHE PROFESSIONTHE PROFESSION
SPECIAL FACTORS PREVAIL ANDSPECIAL FACTORS PREVAIL AND
TRANSACTIONS ARE UNDERTAKEN IN THETRANSACTIONS ARE UNDERTAKEN IN THE
COOPERATIVE SECTOR WHICH CANNOTCOOPERATIVE SECTOR WHICH CANNOT
BE ACCOUNTED FOR NOR PRESENTEDBE ACCOUNTED FOR NOR PRESENTEDSATISFACTORILY WITHIN THE STRUCTURESATISFACTORILY WITHIN THE STRUCTURE
OF PFRSOF PFRS
8/17/2019 Proposed Financial Reporting Standards for COOPS_0
6/26
8/17/2019 Proposed Financial Reporting Standards for COOPS_0
7/26
BSP AND SEC HAVE ISSUED REGULATIONBSP AND SEC HAVE ISSUED REGULATION
REGARDING THE APPLICABILITY OF PFRSREGARDING THE APPLICABILITY OF PFRSAND JUSTIFIED EXCEPTIONS FROM PFRSAND JUSTIFIED EXCEPTIONS FROM PFRS
FOR ENTITIES UNDER THEIRFOR ENTITIES UNDER THEIR
JURISDICTIONJURISDICTIONA SIMILAR, UNEQUIVOCAL REGULATION ISA SIMILAR, UNEQUIVOCAL REGULATION IS
NEEDED FROM THE CDA, OTHERWISE, THENEEDED FROM THE CDA, OTHERWISE, THE
OPINION ISSUED ON FINANCIALOPINION ISSUED ON FINANCIAL
STATEMENTS OF COOPERATIVES WOULDSTATEMENTS OF COOPERATIVES WOULD
BE QUALIFIED, AT BESTBE QUALIFIED, AT BEST
8/17/2019 Proposed Financial Reporting Standards for COOPS_0
8/26
INITIATIVES UNDERTAKENINITIATIVES UNDERTAKEN
DEVELOPMENT OF STANDARDDEVELOPMENT OF STANDARD
CHART OF ACCOUNTS FOR ALLCHART OF ACCOUNTS FOR ALLTYPES OF COOPERATIVESTYPES OF COOPERATIVES
COORDINATION WITH THE PICPACOORDINATION WITH THE PICPANATIONAL COOPERATIVENATIONAL COOPERATIVE
DEVELOPMENT COMMITTEE FOR THEDEVELOPMENT COMMITTEE FOR THE
CONDUCT OF VARIOUSCONDUCT OF VARIOUSCONSULTATIVE CONFERENCESCONSULTATIVE CONFERENCES
8/17/2019 Proposed Financial Reporting Standards for COOPS_0
9/26
8/17/2019 Proposed Financial Reporting Standards for COOPS_0
10/26
POSSIBLE AREAS OFPOSSIBLE AREAS OF
CONSIDERATIONCONSIDERATIONFIDUCIARY INTEREST (IN THE CASEFIDUCIARY INTEREST (IN THE CASE
OF CREDIT COOPERATIVES)OF CREDIT COOPERATIVES)NUMBER OF MEMBERSNUMBER OF MEMBERS
AMOUNT OF CAPITALAMOUNT OF CAPITALAMOUNT OF ASSETSAMOUNT OF ASSETS
EXTERNAL USERS OF FINANCIALEXTERNAL USERS OF FINANCIALREPORTSREPORTS
8/17/2019 Proposed Financial Reporting Standards for COOPS_0
11/26
AS DEFINED:AS DEFINED:
AN ENTITY HAS PUBLICAN ENTITY HAS PUBLIC
ACCOUNTABILITY WHEN:ACCOUNTABILITY WHEN:-- IT HAS ISSUED DEBT OR EQUITYIT HAS ISSUED DEBT OR EQUITY
SECURITIES IN A PUBLIC MARKET;SECURITIES IN A PUBLIC MARKET;
OROR-- IT HOLDS ASSETS IN A FIDUCIARYIT HOLDS ASSETS IN A FIDUCIARY
CAPACITY FOR A BROAD GROUP OFCAPACITY FOR A BROAD GROUP OFOUTSIDERS (e.g. banks, insuranceOUTSIDERS (e.g. banks, insurancecompanies, brokers/dealers, mutualcompanies, brokers/dealers, mutual
fund) fund)
8/17/2019 Proposed Financial Reporting Standards for COOPS_0
12/26
-- IT FILES OR IS IN THE PROCESS OFIT FILES OR IS IN THE PROCESS OFFILING ITS FINANCIAL STATEMENTSFILING ITS FINANCIAL STATEMENTS
WITH A SECURITIES COMMISSION ORWITH A SECURITIES COMMISSION OROTHER REGULATORYOTHER REGULATORY
ORGANIZATION FOR THE PURPOSEORGANIZATION FOR THE PURPOSE
OF ISSUING ANY CLASS OFOF ISSUING ANY CLASS OF
INSTRUMENTS IN A PUBLIC MARKETINSTRUMENTS IN A PUBLIC MARKET
8/17/2019 Proposed Financial Reporting Standards for COOPS_0
13/26
8/17/2019 Proposed Financial Reporting Standards for COOPS_0
14/26
EXTERNAL USERSEXTERNAL USERS
> OWNERS WHO ARE NOT INVOLVED IN> OWNERS WHO ARE NOT INVOLVED INMANAGING THE BUSINESSMANAGING THE BUSINESS
> EXISTING AND POTENTIAL> EXISTING AND POTENTIALCREDITORSCREDITORS
> CREDIT RATING AGENCIES> CREDIT RATING AGENCIES
8/17/2019 Proposed Financial Reporting Standards for COOPS_0
15/26
SIMPLICITY IN SMESIMPLICITY IN SME
REMOVES CHOICES FORREMOVES CHOICES FORACCOUNTING TREATMENTACCOUNTING TREATMENT
SIMPLIFIES METHODS FORSIMPLIFIES METHODS FOR
RECOGNITION AND MEASUREMENTRECOGNITION AND MEASUREMENT
8/17/2019 Proposed Financial Reporting Standards for COOPS_0
16/26
HoweverHowever
COOPERATIVES DEALS ANDCOOPERATIVES DEALS AND
INTERACTS WITH OTHERINTERACTS WITH OTHER
STAKEHOLDERS WHICH MAYSTAKEHOLDERS WHICH MAY
REQUIRE FULL COMPLIANCE WITHREQUIRE FULL COMPLIANCE WITHPFRSPFRS
8/17/2019 Proposed Financial Reporting Standards for COOPS_0
17/26
RECOMMENDATIONRECOMMENDATION
IT IS THE COOPERATIVEIT IS THE COOPERATIVE
DEVELOPMENT AUTHORITY CALL TODEVELOPMENT AUTHORITY CALL TOISSUE A BENCHMARK AS TO THOSEISSUE A BENCHMARK AS TO THOSE
COOPERATIVES WHICH WILL FALLCOOPERATIVES WHICH WILL FALLUNDER SMEUNDER SME
8/17/2019 Proposed Financial Reporting Standards for COOPS_0
18/26
PFRS COMPLIANCE FORPFRS COMPLIANCE FORCOOPERATIVESCOOPERATIVES
8/17/2019 Proposed Financial Reporting Standards for COOPS_0
19/26
ISSUESISSUES
ACCOUNTS PECULIAR TOACCOUNTS PECULIAR TO
COOPERATIVES WITHOUTCOOPERATIVES WITHOUT
APPLICABLE PFRSAPPLICABLE PFRS
* COOPERATIVE DEVELOPMENT * COOPERATIVE DEVELOPMENT
COST COST
* STATUTORY FUNDS * STATUTORY FUNDS
* INTEREST ON SHARE CAPITAL * INTEREST ON SHARE CAPITAL
* PATRONAGE REFUND * PATRONAGE REFUND
* OTHER FUNDS AND DEPOSIT * OTHER FUNDS AND DEPOSIT
* MEMBERS BENEFIT AND OTHER FUND* MEMBERS BENEFIT AND OTHER FUND
PAYABLE PAYABLE
8/17/2019 Proposed Financial Reporting Standards for COOPS_0
20/26
DEFERMENT OF PFRS FORDEFERMENT OF PFRS FORCOOPERATIVES FALLING UNDERCOOPERATIVES FALLING UNDER
SMEsSMEs
PAS 39PAS 39 – – LOANS RECEIVABLE (useLOANS RECEIVABLE (use
of effective interest rate)of effective interest rate)
PAS 41PAS 41 – – AGRICULTURE (fair valueAGRICULTURE (fair value
gains)gains)
8/17/2019 Proposed Financial Reporting Standards for COOPS_0
21/26
DEVIATIONS FROM PFRS DUE TODEVIATIONS FROM PFRS DUE TOINDUSTRY PRACTICESINDUSTRY PRACTICES
PAS 18PAS 18 – – REVENUE (use of modifiedREVENUE (use of modified
accrual)accrual)
PAS 20PAS 20 -- DONATION (as capital)DONATION (as capital)
PAS 16PAS 16 -- PROPERTY, PLANT ANDPROPERTY, PLANT AND
EQUIPMENT (at cost)EQUIPMENT (at cost)
PAS 40PAS 40 -- INVESTMENT PROPERTYINVESTMENT PROPERTYPAS 39PAS 39 -- LOAN RECEIVABLELOAN RECEIVABLE – – LOANLOAN
LOSS PROVISIONINGLOSS PROVISIONING
8/17/2019 Proposed Financial Reporting Standards for COOPS_0
22/26
8/17/2019 Proposed Financial Reporting Standards for COOPS_0
23/26
SPECIAL DISCLOSURESPECIAL DISCLOSUREREQUIREMENTSREQUIREMENTS
PAS 12PAS 12 -- INCOME TAXES (basis of INCOME TAXES (basis of
exemption citing)exemption citing)
PFRS 8PFRS 8 -- SEGMENT REPORTINGSEGMENT REPORTING
(separate books for each(separate books for each
line of business)line of business)
PAS 39PAS 39 – – LOANS RECEIVABLELOANS RECEIVABLE
(details of loans, aging(details of loans, aging
using PAR, etc)using PAR, etc)
8/17/2019 Proposed Financial Reporting Standards for COOPS_0
24/26
COMPOSITION OF:COMPOSITION OF:1. CASH AND CASH EQUIVALENTS1. CASH AND CASH EQUIVALENTS
2. OTHER FUNDS AND DEPOSITS2. OTHER FUNDS AND DEPOSITS
3. DEPOSIT LIABILITY ACCOUNTS3. DEPOSIT LIABILITY ACCOUNTS
4. MEMBERS’BENEFIT AND OTHER4. MEMBERS’BENEFIT AND OTHER
FUNDS PAYABLEFUNDS PAYABLE5. RISK MANAGEMENT POLICY5. RISK MANAGEMENT POLICY
6. FOR THOSE WITH CREDIT ACTIVITY,6. FOR THOSE WITH CREDIT ACTIVITY,
ASSESSMENT OF OPERATINGASSESSMENT OF OPERATING
PERFORMANCE USING COOPPERFORMANCE USING COOP--PESOSPESOS
8/17/2019 Proposed Financial Reporting Standards for COOPS_0
25/26
WHAT IS NEXT?WHAT IS NEXT?
FOR CDA:FOR CDA:
To review and update existing circulars toTo review and update existing circulars to
comply with PFRS
omply with PFRS
To align account definition in the
To align account definition in the
SCAs
CAs
with PFRSith PFRS
To issue circulars on reporting standards
To issue circulars on reporting standards
for special factors and transactionor special factors and transaction
undertaken by cooperatives which are not
ndertaken by cooperatives which are not
covered by PFRS
overed by PFRS
8/17/2019 Proposed Financial Reporting Standards for COOPS_0
26/26
THANK YOUTHANK YOU