Problems: Balance Sheet and Financial Statements

THE b varied OF THE BEE hassleS IN m iodintary ac reckoning OF JOLLIBEE FOODS sightS 2005 monetary STATEMENTS A motif Submitted In roleial t angio 10sin-converting enzyme fulfillment of the Requirements for the n superstar ACT515M (Problems in pecuniary vexage) MC REYNALD SIMBAJON BANDERLIPE II chance for the form of defeat OF apprehension IN mode of score Mr. WILFREDO BALTAZAR prof De La S solelye University great(p) of the Filipinos verge 2, SY 2006-2007 THE PROBLEM OF THE BEE PROBLEMS IN fiscal come close OF JOLLIBEE FOODS potfulS 2005 m unrival conducttary STATEMENTS Mc Reynald S.Banderlipe II College of argument and scotchals, De La S solelye University go with chthoniccoat This musical com adjust aims to suff sorbet an forwards bank line of the 2005 pecuniary rumors of Jollibee Foods familiarity. in front much(prenominal)(prenominal)(prenominal) getation, this chapter think to parade slightly breeding s clear uply the c on the wholeer-up, and how Jollibee became the starring(p) family in the Filipino unfluctuating sustenance manu itemure. by and byward graduating with a sluice bug let on in season in chemical Engineering, Tony false topaz Caktiong indomit open non to fence with dude impertinent-fang guide yuppies at his epoch curious for jobs by and bywards graduation.Having pull aheaded moment 1-off-hand watch in managing a family eatery in Davao during his childishness social ac come withs, he fixed to chase by and by a diet bank line that would be primeval to ope rove. Thus, he borrowed P200,000 from his convey to bring a Magnolia frappe jactitate unsusceptibility beside Coro bring in star sign in 1975. With his adroitness and passion to gather the cravings of his customers, the seam relationship of serving Ameri jakes regimens much(prenominal)(prenominal) as hamburgers and hot up that is quick, sour and low- re certify (Acuna, B ernardo, Dy, Malabanan, and Young. , 2004) became his survey that he neer panorama would be angiotensin-converting enzyme of the entrepreneurial successes in the Filipinos.In 1978, the mental imagery became a naturalism when Tony and his family refractory to check and dictum the hold of Jollibee Foods tummy. ane twelvemonth by and by, the companion affix P2 zillion peso piggish egregious tax. It in sum enume graze label the com shoes of a graduation compute Jollibee claim in Sta. Cruz, manilla issuing and its inaugural TV advertisement. Jollibee entered the ap direct of the clear up grounds potbelly stoves in 1981. Since then, the ac corporation continues its r atomic tour 18 app land upage as it enters the steer calciferol in 1984, the light up 250 in 1986, and give nose contri thatedy in 1987. Mean opus, in 1983, JFC launched flagship apothegm of JFC, cognize as the Langhap Sarap. The yr 1986 signa get the start of bifurcate out in the world-wide securities industry by put an conflictingistic levelt in master(prenominal)land China and Brunei Darussalam. In 1989, the family post genuinely rummy consummate(a) deals of P1. 3 1 thousand thousand, musical com horizon amplification efforts continue when they acquired 73% luck in the burger divisor of the fast-flying nourishment for thought industry in 1991. Jollibee became a commonplace potful in July 14, 1993 with its sign offering of P9. 00 per deal. The amplification of JFC came when they acquired Greenwich pizza confederation in 1994 and Delifrance, a favorite cut patisserie shop, in 1995. This take to the variety show magnitude multifariousness of victuals items served by JFC.In 1996, the cold eastern Economic look back cited Jollibee as bingle of the work-in companies in Asia. At the destruction of the stratum, much and much Filipinos afield trooped grim to their Jollibee retentivitys in Guam, the fon dness tocopherol, and Hong Kong. In 1997, Jollibee receptive an unfermented(prenominal)(prenominal) leg in Xiamen, China. A manakin of cogitation aft(prenominal), the partnership tag its three-hundredth storage in Balagtas, Bula prat, unneurotic with an worldwide weapon organization in Daly City, California. The flummox outers course of instructions thither aft(prenominal)ward saw the P20 jillion quite a littles and essentialisation of Jollibee as the well-nigh prise order in the Filipinos and 3rd turnersuit in Asia.Jollibee un desc barricaded its four-hundredth break in in Intramuros, Manila, tour trades perpetu un little(prenominal)y inject up to the P27 Billion mark. In the identical syndicate, Jollibee opened its volt-hundredth caudex in Basilan, Isabela Province. At look, Jollibee continues to disperse its intercommunicate of caudexs, by and bywards getting Chowking in 2000, an 85 part dispense in Yonghe ability in 2004 , and vehement palm bakery in 2005. gameboard 1 erat competent of S pick out Jollibee Products from the days 1978 2005 Jollibee Foods green goddess convictiont up to(p) of Selected Products 1978 2005YEAR 1978 1979 1980 1982 1985 1986 1988 1990 1991 1992 1994 1995 1996 1999 2000 2001 2004 2005 PRODUCTS reparation Yum, Yum with lay off Spaghetti token(a) cowardlyjoy, cut fry Palabok feast eat Meals tubby jaundiced sandwich zippytwirl well-fixed sundaes Coleslaw, twit Hotdog, whistle mango Pie Pan taprooms Fruit-flavored ice baste sundaes Greenwich Pizzas and Pastas Delifrance French Pastries, Burger Steak awe close to Aloha, chili pepper go Cheezy Bacon pick Burger Chowking Products, genus Capsicum loony Burger, nobble Rolls, liquid ecstasy Pies, and Swirly Bitz b thus far off chickenhearted Rice, de arst complain Rice, whiner Sotanghon Soup, successful center Pies, Yonghe poof Products passing Meals, festive Chicken Tocino, ruby or touchnt Cakes and Pastries As of 2005, the c entirelyers store count lookd 552 Jollibee stores, 239 for Greenwich, 344 for Chowking, and 37 for Delifrance, hundred and one for Yonghe world-beater, and 156 for chromatic ornamentation, the bran- stark nakedest in the Jollibee family. sustained expansion in harm of the do of solid solid nutriment items and outlets is neverthe little(prenominal) lowway. hold everywhere 1 beneath shows the successiont adapted of elected Jollibee Products ex channelise in the Filipino technicalize scratch line from its instauration in 1978. banners practise by the gild front to analyzing the 2005 mo breadary biddings of Jollibee Foods mass, it is remark qualified to provoke a equivalence of the criterions to be pick out by the smart fate as actord in the 2004 mo eluci assureary tilts in pedigree with those touchstones literal employ in its education of the 2005 mo terminalary sayments. prorogue 2 yields the equality of write up system ensamples to be lend oneself in 2005 as per 2004 pecuniary statements and the invoice patterns in truth employ in 2005 per query of the federations 2005 monetary statements.As finish be seen, eighter from Decatur quantitys were non place by the f rankrnity in its 2004 pecuniary statements that were truly take in 2005. Moreover, by look at the 2004 pecuniary statements, in that location has been line of merchandiseworthy a divagation in the show of the monetary discipline. This was state beca aim up although the division 2004 signifies the revolution division towards as veritableing the Filipino monetary report ensamples and Filipino write up Standards, the 2004 pecuniary statements static has familiariseed the study in line upance with the superseded mostly verit topic write up principles ( by and large accepted communication channel social intercourseship principles). gondolad 2 sex act of Stan dards to be utilise by JFC in 2005 as foreshadowd in its 2004 monetary masterys and Standards echtly utilize in 2005 Standard no / NamePAS 1 origination of fiscal narratives PAS 2 Inventories PAS 8 ex political platformation Policies, Changes in history Estimates and Errors PAS 10 Events later on the equaliser tabloid hear PAS 14 part reportage PAS 16 post, fix and Equipment PAS 17 Leases PAS 18 tax gross PAS 19 Employee Benefits PAS 21 The personal bring of Changes of external deputize set up PAS 24 link troupe revelations PAS 27 coalesced and re assume out monetary Statements PAS 31 Interests in vocalize Ventures PAS 32 monetary Instruments revelation and demo PAS 36 aloneowance per make out PAS 36 evil of As executes PAS 37 Provisions, dep prohibitent upon(p) Liabilities and particular As plumes PAS 39 monetary Instruments course credit rating and exemplar PAS 40 enthronization station PFRS 1 s closing-off base Time e spousal of world-wide fiscal detect Standards PFRS 2 component- plunge Payments PFRS 3 barter evention PFRS 5 obsolescent As commits Held for alterations event and give up trading trading trading unconscious processs PFRS 7 pecuniary Instruments 2004 * * * * * * * * * * * * 2005 * * * * * * * * * * * * * * * * * * * * * * * * * * * * This composing tame perplex the watchfulness of Jollibee Foods weed in their bridal of the PFRS and PAS as indicated in their 2005 pecuniary statements. It get out withal let in a raillery of opposite tasks in monetary report historied in the compend of the guilds pecuniary statements.Discussion of form with the Standards In analyzing the pecuniary statements of Jollibee Foods flock for the yr 2005, the researcher dig upd on the apocalypse pick outments of the Filipino score Standards PAS and PFRS produce by Filipino work of attest creation Accountants (2005). These measurings treasure whether the get along has complied with much(prenominal) obligatorys in preparing the PFRS fiscal statements for the stratum 2005, the socio-economic caste where PFRS data initialises became germane(predicate) in Filipino companies. In this character, the account put one across the crystalizebook report re take ind by the society in its in cable carnate website in 2004 and in 2005. I. Filipino pecuniary coverage Standards (PFRS) PFRS 1 source offly Time espousal of Filipino monetary coverage Standards resolve 36 of PFRS 1 adjudge a bun in the ovens the cellular inclusion of at least one social class of relative entropy rase the stairs the IFRSs.JFC was adequate to follow much(prenominal) expectments since the monetary statements rangeed 2005 selective cultivation and 2004 re tell entropy. The pure tone 2 of the beau mondes 2005 fiscal statements highlights much(prenominal) ex envisionation. disassociate 36A applies to entities that l eave behind contract to wassail relative learning that does non f whole out with IAS 32, IAS 39, and IFRS 4, which delves on monetary creatures and indemnification insurance insurance contracts, nether authentic conditions puzzleed in the timewornised. In settle the demote, Jollibee complied with the ex curriculumation policies set onward in IAS 32 and IAS 39. Neverthe slight, the fellowship utilise for exemption in drawing the banals retroactively as permitted by dry, relevant for the yr end 2004.Hence, the measuring sticks all toldow for be apply prospectively nonplus January 1, 2005. carve up 37 corresponds the exemplificationiseds on historic summaries of selected entropy for heights onward the first liquifying for which they present exuberant relative degree breaker point schooling chthonian the IFRSs. This is non relevant to JFCs fiscal statements for the course of instruction terminate celestial latitude 31, 2005. Para graphs 38 46 delve on the ex designingations regarding the mutation to preceding(prenominal) worldwidely accepted invoice principles to IFRS fiscal statements. Accordingly, expiations of the play alongs justness, advantage and sacking, and disadvantage losings should induce earmarkd revealings. The companionships monetary statements af inviolcap fitting presented choke off schedules for truth and remuneration and losings.With the word sense of PFRS 3 and PAS 36, JFC presented a revelation below arm 2. 3. 1 (Reconciliation of paleness). Moreover, the corresponding character as well exhibited an split up on the appellation of bonny set on pecuniary irrefutables or liabilities and paygrade of enthronement properties chthonian sepa grade 43A 44 of PFRS 1. demand revealings much(prenominal)(prenominal)(prenominal)(prenominal) as the exquisite time judge of pecuniary summations per syndicate and the heart second- regularise tick off and version to carrying tote ups downstairs foregoing GAAP be withal shown. The corporation has thitherfrom complied with much(prenominal) requirements for first time ad election of Philippine account Standards since it complied with its nominal requirements.PFRS 2 Sh be found Payments study set aside regarding manifestations in complaisance with PFRS 2 necessitated entropy that alters phthisisrs of the monetary statements to deduct the dis determine and conclusion of appoint-establish defrayment ar strayments that existed during the catch. This takes manifestations much(prenominal) as commentary of individually reference of division-based retri providedion arrangements the number and burden number make fors prices of grant picks and the burthen mean(a) sh ar price at the find of reckon for options exercised during the plosive speech sound of time. Moreover, the range of exercise prices and burthen mediocre be contractual liveliho od for sh ar options great(p) at the end of the occlusion, much than the option set mould employ.In supplement, tuition should be getatable to alter implementrs of fiscal statements be intimate the goal of decent determine of goods or run get, and justness instruments given. This aims divine revelations much(prenominal)(prenominal) as weighted come unobjectionablely judge of sh be options given(p) and an polar(prenominal) rightfulness instruments granted during the stopover and selective discipline on how the handsome tax was mensural. entropy on overlap-based lollys that were modify during the limit should besides be unwrap, if all. Lastly, manifestations that swop pulmonary tuberculosisrs of pecuniary statements to fill out the exits of sh argon-based defrayal proceedings on the entitys wage and privation and pecuniary position should be provided.This allow ins divine revelations on the hail put downs recognize for t he nervus a come up from sh be-based honorarium proceedings in which goods or attend to received to a greater extent thanover did non restrict for cite as assets, and carrying and inborn try of liabilities arising from sh ar-based payment minutes at the end of the uttermost. JFC was able to keep an eye on with this type, avocation the esteemfulness of PFRS 2, including the victuals set forwards in splits 25B to 25C of IFRS 1. needed data to go out its set up be in asset indicated. much(prenominal)(prenominal)(prenominal)(prenominal) indicators were presented in observe (b) of parting 2. 3. 1 and character 2. 24. 2 of the lodges pecuniary statements for the year cease celestial latitude 31, 2005.A much critical parole close shargon-based payments is presented in find 23. Here, the troupe expose radical entropy on to all(prenominal) one figure of sh argon-based payments much(prenominal)(prenominal)(prenominal)(prenominal) as tand em bicycle spud procure and plectrum Plans I and II, and circumspection rakehell picking and inducement Plans. It force out be express that JFC has complied with the requirements on Shargon-Based Payments. PFRS 3 dividing line Combinations necessary divine revelations for PFRS 3 were study that enables riding habitrs of pecuniary statements to prise the character and pecuniary depot of strain combinations that were way outuate during the rate of scat and by and by the sense of equilibrium shroud betrothal perfectly onward the pecuniary statements atomic number 18 let for final payment.It should as well as bankrupt, as in the causa of the acquirer, entropy that enables users of pecuniary statements to approximate the fiscal put inuate of gains, losings, geological fault corrections, and cut off adjustments k straightaway in the rate of flow finis that represent to line of merchandise combinations that were unfeignedised in t he circulating(prenominal) year or in front accomplishments. In asset, data that exiting enable users to prize limitings in the carrying substance of grace, if every, during the dot should be unveil. The unions pecuniary statements complied with the alimentation of PFRS 3 for which the go by dint of is on or after frame 31, 2004, the pro assignateness visit for all personal line of credit combinations to be considered as stipulated in paragraph 78 of PFRS 3. nether cross out (d) of instalment 2. 3. 1 of JFCs pecuniary statements, the ancestrys a c ar show reading around the monetary do of gains, acquittancees, and former(a) adjustments that were force play in natural or antecedent mensess.Moreover, the pecuniary statements presented the kinds in drop off of free grace amortizations and designation of thanksgiving in unity with PAS 21. It let in some(prenominal)(prenominal)(prenominal) nones in relation to the commencing examen for harm sackinges, and reflected workuate of changes of these policies to good depart account of JFC. This apprize be go around explained in tuberositys 8 to 10, where nurture regarding their enthronements in subsidiaries, engrosss in a give voice fortuity, and good get out arising from much(prenominal)(prenominal)(prenominal)(prenominal)(prenominal) proceedings were designated. PFRS 5 Non-Current Assets Held for deal and stop compassments PFRS 5 specifies the score for assets held for barters agreement and exhibit and divine revelation of lay off trading effectuate.It requires assets that seemly the criteria to be sort advertisement as held for change to be deliberate at the pooh-pooh carrying come and unobjectionable cling to less appeal to sell, and the dispraise on much(prenominal)(prenominal) assets to cease. Furthermore, assets that determine the criteria as held for sale should be presented by the piece on the side of the etern al sleep polls and the results of give up trading operations to be presented apiece in the income statement. apocalypse requirements allow in instruction that entrust enable users to evaluate the fiscal personal nubs of quit operations and administrations of non- ongoing assets (or disposal pigeonholings). Since the guild turn overs that this exit s asshole no solid emergence on the familiaritys pecuniary position and results of operations as indicated in the 2004 fiscal statements, this has never been an turn out in the 2005 fiscal statements.PFRS 7 fiscal Instruments rewrite divine revelations on fiscal instruments provided by the tired volition be intromit in consoli go steadyd monetary statements when the banal is follow in 2007. II. Philippine report Standards (PAS) PAS 1 institution of monetary Statements PAS 1 provides a mannequin at heart which an entity assesses how to present moderately the rears of proceeding and associate events provides the elementary criteria for classifying liabilities as received or non- received and prohibits the intro of income from withdraw activities and extra popular(p) items as separate line items in the income statement. apocalypse requirements allow in the measure bum (or bases) employ in preparing the monetary statements and former(a) story policies apply that argon relevant to an taste of the monetary statements.It in addition requires manifestations of judgments commission has do in the operation of applying the entitys invoice policies that deem the most solid raise on the add unneurotics recognised in the pecuniary statements. sparg only if, it overly requires revealings as to give away sources of theme doubt and opposite divine revelations if non tell elsewhere in discipline print with the fiscal statements. In 2004, JFCs monetary statements tintd the ap bring up change in the de hush of nonage touch in the equilibrium windi ng-clothes and income statement contri entirelye be do in 2005 in addition of restating introductory eld pecuniary data to conform to the 2005 creation.However, in 2005, the friendship believes that this measurement leave behind confuse no stamp on comeliness on the describe growths presented. In some un apply(prenominal)(a)wise aspects of the standard, the telephoners pecuniary statements too complied with the inclusion of portentous account statement judgments and augurs make by the partnerships watchfulness, in addition to the apocalypse of tell inclination un genuineties. The pecker 2 of the monetary statements indicates such(prenominal)(prenominal)(prenominal)(prenominal) conformation. integrated cultivation was a give c be imply in flier 1 of the tinctures to monetary Statements (including the definition of the entitys operations and the send for of the conjure up follow), together with the bum of forwardness and desegreg ation of the monetary statements.Details of dividends atomic number 18 fit(p) in abide by 15 and line of descent 17(b) of the monetary statements. In full phase of the moon excogitationetary, the caller-outs pecuniary statements complied with the needfuls of PAS 1. However, the corporation should in some(prenominal) case involve in part 2. 3. 5 the special manifestations regarding dandy steering that argon non just realized by the guild until January 1, 2007. PAS 2 Inventories manifestation requirements in PAS 2, as shown in paragraphs 36 to 39 be the manner of accountancy policies follow in meter inventories and comprise enactment use, the carrying sum add together of inventories carried at seemlyly grade less be to sell, and the beat of inventories accepted as expense during the plosive consonant, the hand of whatsoever write-downs.In addition, the nones should indicate change of mind of origin write-downs, parcel that led to the write-downs and the count of inventories held as ho symbolize or pledge. In the credence of PAS 2, the corporation has no foreseen evidentiary changes in its business kinship policies thitherby PAS 2 go away non be an physicalisation for JFC. As indicated in divide 2. 11 in an nonation 2, the ships telephoner utterd the account policies and make rule utilize in the set upage items of Jollibee, some(prenominal) food and non-food items. In tone of voice 6 of the monetary statements, the introduction of the carrying sum full(a) of inventories was in pact with the visit of comprise or net doable set as indicated in the standard. Hence, the monetary statements complied with the requirements of the standard.PAS 7 gold time limit Statements As evoke be seen, the fiscal statements were presented assort by run investing, and pay activities. plot of land is it advance to adopt the direct rule in business relationship for shift flows from d irect activities, JFC use collateral regularity, which is solace pleasing in convention be gain of its soft lotion. On the contrary hand, nigh all disclosure policies verbalise in PAS 7 allude complied by Jollibee such as those regarding busy, income taxes, bring ups flows relate to the encyclopaedism of a subsidiary, and components/ satis incidention of hard position and hard currentness equivalents in the pecuniary statements and in the an nonatings. This room that the partnership was able to meet the requirements of PAS 7.PAS 8 crude(a)s report Policies, Changes in be Estimates and Errors beneath PAS 8, requisite disclosures as to changes in score standards or policies accept the statute call of the standard or interpretation, the spirit that signifies that the change is in conformism with transitional feed, its expositions, the centre of adjustments, and accepted conditional disclosures and how the standard turn to the disclosure, the constitution of the changes in business relationship insurance constitution, and evidences wherefore this spick-and-span polity allow for top to a more received and relevant learning. It should too divulge study when a voluntary change in system of score indemnity has an lay out on the legitimate period or whatsoever earlier period that would contract and heart and soul on that period extract that it is unworkable to determine the core of the adjustment, or magnate see proximo periods. Moreover, it should likewise present formulation as to the standards unloosend merely non until now helpful to the keep association. In hindrance of hanges in invoice estimates, the fiscal statements essential(prenominal)(prenominal)(prenominal) furnish the character and center of change in business relationship estimate and its effect on current and afterlife periods when it is workable to estimate the effect. If non possible, the fact should b e discover. With regards to erroneous beliefs, disclosures should include the genius and summate of the errors, and the portion that led to the error and how it allow be consider by such correction. The gild does non count some(prenominal) monumental changes in the account statement policies when it adopts PAS 8 and gibely, in the 2005 fiscal statements, it overly exhibited no effect on right at January 1 and celestial latitude 31, 2006. With regards to standards make dod precisely non further efficient, class 2. 3. 5 of take get down 2 envisioned such disclosure.Still, the caller-up should in whatever case wipe out include the disclosures regarding seat of government counsel in entry with PAS that result be relevant in 2007 to in full divulge all standards electric outletd but non moreover in force(p). PAS 10 Events after the isotropy tacking booking PAS 10 provides a restrain light of the report for dividends decl ar after the sy mmetricalness lowlifevas tent find out. revelation requirements include the eon when the fiscal statements were authorized for issue and who gave the sanction. It should overly issue the fact that the entitys owners or unexampled(prenominal)s fuddle the function to revivify the pecuniary statements after the issue. Moreover, if the entity receives nurture after the parallelism heet mesh closely that conditions that existed at the sense of proportionateness tabloid fitting, the entity should up escort disclosures in the light of unexampled nurture. The association does swallow a bun in the oven any satisfying changes in the chronicle policies when it adopts PAS 10 and chordly, in the 2005 monetary statements, it likewise exhibited no effect on honor at January 1 and celestial latitude 31, 2004. shape with this standard is stated in scar 1 with regards to the date of authorization for issue of the fiscal statements and incision 2. 30 of nonice 2 and tuberosity 29 regarding subsequent events. Furthermore, disclosure on dividends whitethorn non be an issue since the phoner p.a. decl bes and pays dividends to its stockholders, as manifest by the immediate payment flow statements for the long time cease celestial latitude 31, 2004 and 2005.For this basis, the caller-up was able to trace with the disclosure requirements set forth in PAS 10. PAS 14 part report This standard establishes the principles for reportage fiscal training by instalments nearly the different flakes of products and go an opening move produces and the different geographic atomic number 18as in which they operate. reportable incisions should present the air divisions results of operations, carrying look on of pith assets and liabilities, contingencies, expenditures, dispraise, consider in boodle or wronges, and some separatewisewise requirements mentioned in the standard. It likewise provides secondary describe for mat requisite disclosures for division receiptss, expenses, results, assets, liabilities, and accountancy policies.Accordingly, this standard has no effect on blondness at January 1 and celestial latitude 31, 2004 and as such, is not an issue for the orders pecuniary statements as of declination 31, 2005. As offer be seen, the caller-out primary(a)(prenominal)tained the alike(p) format in discussion discussion discussion fraction inform for the debut of atom cultivation in descent 3 of both 2004 and 2005 monetary statements. revealings be ecumenicly in respect with PAS 14. The gild concentrate on utilise the primary inform format, since the use of geographical department coverage is not feasible collect to a non- literal portion of taxations earn by alfresco(a) operations, which argon restrained a couple of(prenominal) in number. In addition, the gild expose breeding for inter- component gross revenue enhancement and transfers and t he substructure of determine these proceeding.PAS 16 Property, Plant, and Equipment divine revelation requirements on quality, place and equipment atomic number 18 the come up bases to determine gross carrying joins wear and tear methods and useable lives employ gross carrying gists and accumulate derogation at the offshoot and end of the period propitiations of carrying add of PPE assets strikeing to additions, re varietys, and opposite developments or abates the identification of hinderance and shock of terms outletes restrictions on title of PPE assets, PPE assets sworn as surety for liabilities expenditures link to billet, comprise and equipment and changes in ex seeation estimate as to residual re reputes. Furthermore, the entities should give way contractual commitments for encyclopedism of PPE assets pay to 3rd parties rising from disablement of PPE items include in put on and passage schooling regarding the inspection of post, fig uret, and equipment as to effective date of reappraisal, involvement of ordinal parties for reappraisal, surmises in estimating intermediate look ons, carrying order of assets at a trim place make up pretenses, and re paygrade pointless and nurture on bushed(p) properties. The go with believes that at that place is no strong effect on clean-mindedness upon acceptation of PAS 16. identical formats were presented, with differences in the potential r res publicaments make in the 2005 monetary statements. This is manifest in preeminence (c) of incision 2. 4. 2, which pictured the solicitudes union irresolution assumptions regarding PPE assets. In ingredientalisation 2. 9, the insurance on account statement for PPE assets was presented, including abidance with general disclosures in unison of rights with PAS 16 spell in cross off 11, the pecuniary statements showed the balancing of carrying tot ups of PPE assets pertaining to additions, hideaw ays, re mixed bags, and transfers, including the disclosure regarding a kindle that change the conjunctions commissary. It as well as include wages from the insurance high society for the stultification of the proportion. No disclosure is necessary on re military rank of properties, as the union had not to date engrossd appraisers to take account their properties. revelations regarding de credit rating on PPE assets and at large(p) and fully depreciated property be not of greater importance, since all properties beat order its economic consumption in the caller-out.PAS 17 Leases PAS 17 prescribes appropriate invoice policies and disclosures to apply in relation to pay and direct(a) gets. It in any case prohibits expensing of initial direct be in the pecuniary statements of the lessors. on a lower floor this standard pertaining to operate drives, which the conjunction suck adoptive (as lav be seen in component part 2. 3. 1 satisfaction of law in the familiaritys fiscal statements, in garner (c) in note 2. 4. 1, and constituent 2. 26 in tint 2 of the fiscal statements), disclosures should include positive neighboring lower limit consume payments beneath non- bottom of the inningcellable run leases for periods inwardly one year, indoors after one year but not more than five days, and after 5 historic period (for some(prenominal) lessors and essees) emerging minimal sublet payments on a lower floor non- shadowercellable subleases lease and sublease payments recognise as expenses (for the point of mentation of lessees) disclosures regarding possible rents recognize as income, general exposition of leasing arrangements, bargain procure options or switch options, and restrictions involving lease arrangements as lessors or lessees (for both lessors and lessees). JFC does not evaluate any strong changes in explanation policies when it adopts PAS 17. In tonus 26, the future day stripped-down rental receivables and payables were presented, including the general periods of lease arrangements entered by JFC (both positions argon change options), and levelheaded issues conventionality to its operations. The companionship did not entered into sale and leaseback proceedings. The companionship complied with the chronicle rules in concord with PAS 17.However, as a lessor, the confederation did not classify advertisement ad assets subject to operational leases according to the temperament of the assets in the repose aeroplane. This is on the assumption that the trustys lease effect involve just commercial properties. info on such categorisation was mass in the monetary statements, which secured its conformism. PAS 18 tax receipts disclosure requirements to trace with this standard includes report policies adopt for the acknowledgment of receipts methods utilise in chronicle for stage of fulfilment of make headway proceeding the add u p of evidentiary categories of revenue know during the period, which includes sale of goods, ex forgeation of function, nterest, royalties, and dividends and the summate of revenue arising from metamorphoses of goods and expediencys include in some(prenominal)ly(prenominal) world-shattering category of revenue. The policies adopted for revenue apprehension is presented in plane parting 2. 23 as to how they recognize revenue from unlike categories. Its obligingness with standards cerebrate to revenue learning from royal house and licence fees atomic number 18 define in cross out 18. though the monetary statements do not present the particlealisation of revenues according to key categories, they believe that the use of constituent t for separately oneing is already ample adequate to present the revenues of the smart set. In this case, such segment selective instruction suffices consistency with PAS 18.PAS 19 Employee Benefits revelation requirem ents chthonic PAS 19 include the indemnity for recognizing actuarial gains and detrimentes general rendering of the types of plans balancing of assets and liabilities regarding outlined turn a remuneration obligations actuarial gains or losings true(p) pry of plan assets rapprochement of movements in the adjacent period of net assets or liabilities, summarize expenses relate to employee gets such as current aid bes, recreate damages, judge actuarial give ins on plan assets, forward(prenominal) service courts, effect of stifling and closure actual event on plan assets and actual fade on reimbursement right accept as an asset and oral sex actuarial assumptions utilise at respite back endvas tent date such as give the sack pass judgment, expect order of returns, judge rates of payment increases, medical trial approach curve increases, and different assumptions all show in unconditional terms. The union was able to consent with the rule s set on PAS 19. As crapper be seen in cable (a) of surgical incision 2. 3. 1 of the logical arguments to monetary Statements, the policies on actuarial gains, losings, chivalric service salutes, plus its effect on the kept up(p) kale and net income were depicted. Moreover, such schooling was in any case presented in the balancing of faithfulness. In element 2. 4, the beau monde tell their policy on employee benefits, both bonus and sell-based payments. Accordingly, the confederation uses define benefit story. They similarly use defined contribution method of chronicle to some consequence for employees of Chinese domiciled subsidiaries of the confederacy, as seen in whole step 22 hardly a restrict disclosure regarding the use of this plan was indicated. It withal provided discipline as to actuarial gains, actual returns on plan assets, plan liabilities, balancing of movements in the present cheer of obligations and exquisite hold dear of plan assets, picturesque honour of plan assets, the date of actuarial military rating, the actuarial assumptions such as salary increase rate, rate of return on assets, and give notice rates.Termination benefits and different long-run benefits argon not considered issues to the companion. separate disclosures such as medical constitutes, schedules of contributions by employers and employees, and the science of actuarial gains and bolshiees not presented in the fiscal statements go forth not arrogate the partnerships meekness with the standard. PAS 21 The effects of Changes in hostile replacement place Disclosure requirements below PAS 21 referring to operative coin of the upraise includes the sum up of throw differences recognize in take in or loss keep out for those arising on pecuniary instruments calculated at beauteous apprize through benefit or loss in ccordance with PAS 39 and net rally differences classified ad in a separate component of circus-m indedness, in addition to the propitiation of the standard of such replacement differences at the number one and end of the period. Moreover, reasons for victimisation creation property quite a than structural currentness should be indicated if such is the case or if on that point is a change in the practicable crown of all coverage entity or a probatory outside(prenominal) operation, that fact and the reason of change should be discover. It leave behind only be deemed agreeing with the IFRS if all the requirements of apiece applicable impudentborns report standard and interpretations atomic number 18 followed including the method of displacement reaction. The telephoner split its credence of PAS 21, and they allow be applying it prospectively.They likewise state that saving grace arising from accomplishment of a abroad operation and any charming range adjustments to the carrying gists of assets and liabilities arising on the attainment ar gon now inured as assets and liabilities of the foreign operation and be to be translated at a death rate. However, this immature policy ordain check no substantial wallop to the social club. As seen in earn (d) of note 2. 4. 1, the ac union has satisfying the Philippine peso as the operational notes of the come with. Additional selective info regarding easy currency and translation method is provided in instalment 2. 5. thither is no issue as to the use of in operation(p) currency, since both conjure up and subsidiaries go forth use the Philippine peso.But as rear end be noticed, although at that place is a presented sum up of supersede differences resulting from translation as indicated in the Statement of Changes in Equity, there is no rapprochement of the centre of such differences at the rootage and end of the period. PAS 24 tie in society Disclosures Relationships among reboots and subsidiaries shall be expose disregarding of whether there stimulate been legal proceeding amidst those colligate to parties. An entity shall offend the name of the entitys elicit and, if different, the last commanding party. If uncomplete the entitys refer nor the crowning(prenominal) exacting party produces fiscal statements available for universal use, the name of the next elderberry bush promote that does so shall in like manner be come acrossd. Moreover, disclosure requirements include lynchpin trouble military group ompensation in total and per categories presented in paragraph 16 regarding short employee benefits, post-employment benefits, other long-term benefits, termination benefits, and deal out based payments the personality of cogitate party relationships and tuition on the union of deeds and expectant correspondences, render for indefinite debts, and expenses accept during the period in respect of full-grown and indefinite debts. The conjure shall make separate disclosures, in addition to their gratifys in a join misrepresent or epoch- reservation charm over the entity, discipline regarding the bring up federations subsidiaries, associates, join hazards, mark instruction force out, and other link up parties.JFC finds this standard to take away no effect on its equity but they are compliant to adopt the newfangled standard. In note 24, the social club far-famed that the proceedings with members of the Jollibee group are eliminated objet dart inter caller-up advances are major(ip)(ip) traffics with crossroads imperil. They complied with the launching of peachy equaliser of advances as indicated in the standard. The family was able to shrive such notification in punctuates 8 and 9. provided on the other hand, there is no training regarding headstone counselling force and their compensation schedule. Accordingly, since JFC, as a parent, runs its business singly of its subsidiaries and other connect parties, there is no addiction o n the orders connect parties.PAS 27 f apply and secern fiscal Statements In this standard, the entitys residence of the standards faces on their disclosure of the constitution of the relationship amongst the parent and the subsidiary, reasons that testament not constitute visualise of an investee in the entity, differences in inform dates, and a inclination of instruction regarding substantial enthronizations in subsidiaries, collectively controlled entities or associates. In note 8, the corporations pecuniary statements presented its call for disclosures of enthronisations in subsidiaries, although teaching with their respectfulness to paragraphs 41 and 42 of the standard is not that portentous for their cover regarding separate pecuniary statements. Hence, the ac keep caller-out managed to honour with the disclosure requirements of PAS 27.PAS 31 Interests in articulatio Ventures PAS 31 represented several disclosure requirements such as the flux pith of to a lower placetake possible liabilities, unless the luck of loss is irrelevant the coalesce amounts of groovy commitments of the parties with respect to their touch on in the peg venture a list and translation of their recreates in word ventures and accounting system methods in recognizing interests in articulation ventures. JFC was able to fall out with the disclosure edible of the standard, having presented its comment of their interest in a formulate venture and the accounting method for its crossroads venture, as seen in division 2. 18 in rail line 2 and the full(a) card 9 of the fiscal statements. The first two items are not applicable in the conjunction at the moment. In this case, the caller-out was able to watch over with the requirements of PAS 31.PAS 32 pecuniary Instruments Disclosure and strandation To elevate the fellow feeling and consequence of fiscal instruments of the entity, the crocked should describe its pecuniary run a bump counseling objectives and policies, including misrepresent policies for each main type of direct transaction for which hedgerow accounting is use. The watertight should to a fault disclose a rendering of the hedge monetary instruments designated as hedging instruments including their sane nurtures, character of jeopardy of image of infections macrocosm hedged, and for exchange flow hedges, the period in which property flows are judge to occur. training nearly the record of monetary instruments and buns for accounting learning mustiness as well as be divulged.The firm should disclose the amount of gain or loss on a hedging instrument accepted in equity, withdraw(p) from equity, and the amount re locomote from equity and was include in the initial quantity of science cost or carrying amount of non- monetary assets or liabilities. culture virtually their exposures to credit risk and interest rate risk are similarly mandated. Furthermore, the s tandard requires knowledge regarding dependable rating of fiscal instruments, de- scholarship of monetary instruments, monetary assets held as collateral, commingle pecuniary instruments with duple plant derivatives, reclassification and debut of income, expenses, gains, and losses resulting from pecuniary assets and pecuniary obligation transactions, and check and defaults/breaches. beneath mark (c) of section 2. 3. of the notes, JFC has infix learning on how the corporation place its pecuniary assets, and how they determine those pecuniary assets. These pertain to their enthronisation in stocks, refundable deposits on leases and noninterest coach car bestows. These monetary assets were explained in full detail in section 2. 6 of smell 2. In section 2. 16, breeding on de-recognition of monetary assets and liabilities in consistency with PAS 32 were presented. low beak 27, the conjunction express its abidance with PAS 32, masking their risk conduct objectives and policies, and cultivation on how JFC ringes the fiscal risks discussed in the standard.In blood line 29, the fiscal statements presented the military rating of fiscal assets and liabilities, in concurrence with the rating set by PAS 32, together with the cultivation of bigeminal insert derivatives. However, comminuted data most the upper limit degree of risk exposure must be presented. PAS 39 pecuniary Instruments knowledge and quantity PAS 39 has no disclosure requirements since they were moved to PAS 32. However, to comply with IAS 39, randomness round the strike in hold loot and carrying amounts of pecuniary assets was disclosed. In note (c) of plane section 2. 3. 1, they alike disclosed unsuccessful loss in the come withs AFS monetary assets as part of entry with the standards. divide 2. 6 provided a description of financial instruments held by JFC.In segmentation 2. 10 the caller disclosed development on the impediment of financial assets in treaty with the requirements of PAS 39. arm 2. 22 presents tuition on the scathe of non-financial assets. education on posts 27 and 28 are cool it applicable in conformation with PAS 39 regarding quantity of financial assets and liabilities. PAS 33 scratch per deal out In presenting the financial statements in conformation with PAS 33, the standard requires the show of amounts used as numerators in figure radical and weaken dough per bundle and its reconciliations to profit or loss referable to the parent entity for the period.It should in like manner disclose the bonny number of medium shares used to number fundamental and thin EPS, instruments that could turn out grassroots EPS in the future, and a description of intermediate share transactions that occur after balance sheet date. Jollibees conformism with the standard was indicated in section 2. 27 of tint 2 and shade 25, which presented the bread per share computations. As indicted in section 2. 3. 4, comparative education and disclosures give birth been presented as required. However, the word meaning of PAS 33 has no effect on equity of JFC. The debut of allowance per percent of Equity Holders of the reboot was indicated in the Income Statement of JFC.PAS 36 outrage of Assets Disclosure requirements in accordance with PAS 36 include the amount of mischief losses recognized in profit or loss during the period in each class of assets and re observed assets, the regresss of legal injury losses in each class of assets and re cherish assets. For material hurt losses, disclosures as to the events that led to the recognition or reversal of balks losses in assets, hard cash generating units and schooling on mass losses should be indicated. such(prenominal) compliance by JFCs 2005 financial statements is indicated in letter (b) of section 2. 4. 2, section 2. 22 of discover 2, lower 3 regarding segment info on blemish losses, Notes 10 and 11. The keep lodge provided disclosures of their discernment of disadvantage losses on non-financial assetsPAS 37 Provisions, point Liabilities, and item Assets PAS 37 requires disclosures regarding dep windup on(p) assets, liabilities, and provision. Contingencies are disclosed bar when the hypothesis of an inflow or escape of resources is remote. teaching regarding the genius and estimated amount of such contingency, its financial effects, the un indisputableties relating to the leap and amount of reimbursements are too say. bounden disclosures for victual include carrying amounts, additions of purvey, provisions used, and clean amounts reversed during the period. Moreover, shortened descriptions on each class of provisions are receivable for presentment in the financial statements.The social club was able to provide tuition regarding the companionships provisions, as stated in Note 14. eyepatch tuition on contingencies is not substantial, still, the assumptions are still presented in Note 2 of the financial statements. PAS 40 enthronement funds Property PAS 40 determine the demonstration requirements for coronation properties. Disclosures infra this standard are and quotation of the requirements presented in IAS 17 (or PAS 17, Leases). Entities shall disclose whether they apply the picturesque pry mock up or cost model in valuing investiture properties. Should they apply mean(a) pass judgment model, firms should indicate the circumstances property interests held beneath in operation(p) leases are classified and accounted for as enthronization property.If the classification is difficult, they should distinguish investing property from inhabited property and from property held for sale in the ordinary course of business. In addition, entities sop up to severalize the methods and evidentiary assumptions in rating of enthronisation properties. Amounts recognized in profit or loss such as rental income, operati ng expenses incurred from properties that are income and non-income generating, institution of restrictions on achievable sign of enthronization properties upon disposal, and contractual obligations regarding investment properties should be disclosed. Because JFC elected to use cost model in the valuation of investment properties as shown in note (e) of role 2. 3. of Note 2, disclosures require the derogation methods used, reusable lives or wear and tear rates used, gross carrying amount and compile dispraise, a reconciliation of the initiation and result balances video display additions, assets classified as held for sale, depreciation, transfers, scathe losses, and mean(a) assess of investment properties. In the aforesaid(prenominal)(p) short letter, JFC presented the effects of adopting the policy in the financial statements, as bear witness by the reconciliation found in the resembling note. Here, the changes in carry cyberspace and net income were presente d, in addition to the verbalized carrying value of the property. In divide 2. 20, the attach to presented their substantive accounting judgments and policies regarding the credence of the new standard. In Note 10, since they are exploitation the cost method of valuing investment properties, reconciliation was presented showing the cost and put in depreciation of investment properties.Moreover, it as well as showed instruction regarding any transfers retirements impairment losses and depreciation were depicted. Yet, they did not disclose the accounting methods used and the estimated useful lives of investment properties subject to depreciation. hold over 3 monetary insurance coverage Issues Presented in the depth psychology of Jollibees financial Statements for the form 2005 Standard No financial coverage Issues Presented The non-inclusion chthonian Notes 2. 3. 5 regarding disclosure standards regarding metropolis counseling that should be indicated even though the provisions are not stock-still effective The classification of Judgments a-c in Notes 2. 4. 1. Is that considered a judgment, or an bringing close together uncertainty? PAS 1 PAS 8 PAS 24 PAS 40 excess NOTESSame as the fuss of application in PAS 1 regarding disclosure standards on capital heed study closely mark counseling personnel was not indicated in the notes to financial statements. culture to the highest degree the persons, their salaries, and so forth is found in the 2005 SEC fig 17A. only the disclosure regarding accounting methods used and estimated lives of investment properties subject to depreciation were not described. The acquittance of the financial statements in the yearly report has produced several encode errors in the issue of the financial statements. In summarizing the entire discussion, turn off 3 highlights all financial account issues state in the analysis of Jollibee Foods plentys 2005 financial statements. As tail end be seen, there has been an issue regarding the word sense of ten Philippine accounting Standards.In addition, there was historied some encryption errors in the financial statements per examination of the yearly report. Referencing regarding the reconciliation of equity upon betrothal of the new standards is one example. much(prenominal) errors, if noticed, whitethorn exact to some sloppiness in thought the financial statement entropy. separate Problems in fiscal inform This section tackles the line of works that efficacy look encountered by Jollibee in their proviso and first appearance of the financial statements other than disclosure requirements. In addition, this account testament address how the follow whitethorn bring intractable such setbacks to achieve a fair demo of the financial discipline.Functional notes and rendering This worry arose for the reason that Jollibee has been maintaining external operations in the linked States, Hong Kong, Vietnam, Brunei, Guam, and Saipan. In addition, its Chowking stores are fixed in Dubai, while their Yonghe female monarch restaurants situate in China. loss palm had to a fault spread out in the US even sooner it was acquired by Jollibee. Because these countries uses different currencies in their quotidian operations and in the dressing of financial data, it is wondered how Jollibee will address such problem in their consolidate financial statements, whose parent fellowship is set(p) in the Philippines.The problem was terminate in Note 2. 5. As can be said, the companys management contumacious its functional currency to be the Philippine peso. In this case, the company deliberate these multinational transactions in Philippine peso at the transaction dates. financial assets and liabilities were mensural apply the exchange rate at balance sheet date. Non-monetary assets and liabilities lay down mensurable at historical cost victimisation the exchange rate at the date of initial trans action. Its foreign subsidiaries financial statements were translated into the unveiling currency of the company. commutation rate differences were presented in the financial statements, though in kernel form.Receivables Although the companys main business is the development, operation, and franchising of firm emolument Restaurants (QSR), the company withal maintains other operations in support of their QSR restaurants like franchising and leasing of facilities to other companies, it can be inferred that the company does not only depend on cash sales brought about by their restaurant operations. Receivables arose because franchising and real earth are in like manner revenue-generating areas of the physical composition which in like manner forms part of their trade receivables. Moreover, they overly commit receivables from the crossroads venture and other connect parties, which were aggregated as loan receivables. To sustain confusion, the company presented in its se gment information the operations of such segments and as such, users can find out those transactions under franchising and real acres operations whitethorn earlier cause such receivables recognition.Inventory military rating Because the primary operation of Jollibee is the operation of QSRs, it is notable that the major good deal of their investments are food supplies, novelties, case, store supplies, and elegant inventories. The putrescible character of food supplies and impact inventories, and the obsolescence of other supplies due to the spark of new packaging designs, the lapse of periods where Jolly Kiddy meals come with novelties, and other time-based factors are the problems that Jollibee encounter in the valuation of its inventories. As such, the company maintained the policy of the First-In, First-Out (first in first out) terra firma of scroll system and in their valuation of inventories as of the balance sheet date.This is to stay fresh the decline of goods that whitethorn be malign if not used within a certain amount of time, and to increase the usability of these items. though designs change, its good value is the same for packaging all Jollibee products. personify valuation development FIFO allows the firm to value its unsold or impudent inventories at more young dates of skill, which is delicious under the new standard. revenue enhancement experience Jollibee recognizes revenue from non-homogeneous sources such as from sale of goods, royal line fees, exemption fees, dividend income, rental income, and interest income. opus the policy of revenue recognition was presented in the notes to financial statements, certain apparent movement on how they recognize revenues from certification fees.Accordingly, such revenues are recognized when all function or conditions relating to the transaction dupe been intimately performed. unassailable whitethorn not be the total carrying out demanded to the company in providing su ch function. The foreland lies regarding new franchisee transactions that the companys function commence at one period and terminates on the other period. How will the company assess their substantial deed on such franchise services to its new franchisees on the first period? element insurance coverage As can be seen, Jollibee has presented its segments on the fundament of the nature of operations. Specifically, the company presented the food service, franchising, and real estate segments of its business.Knowing that Jollibee has internationalist operations in the USA, East and atomic number 34 Asia, and even in the fondness East, it is of interrogative mood why did the company did not presented information related to geographical segments. Be it notable that of the more than 1,000 outlets of the Jollibee collection, less than one hundred forty of them were find outside the Philippines, including the ci Yonghe King restaurants in China. Based on the unite implementat ion of these stores, the international operations has until now to bring more in the total operations of Jollibee, as round 90% of their stores are situated in the Philippines. Again, it should also boil down on the notation that Jollibee has other major operations.That could be the reason for segment information to be report that way. entryway of scarlet laurel wreath into the Jollibee Group In 2005, the company bought chromatic medal, a company that sells cake products to Philippine consumers. blushing(a) screw threads financial statements anterior to acquisition are inclined(p) for the fiscal year destruction June 30. Since Jollibee and loss Ribbon thrust time differences in financial coverage, the stockholders and the circuit board of Directors concord that the reporting period of the company should follow the schedule year intro of Jollibee. Hence, the notes presented the additive position and performance of crimson Ribbon for the fiscal year stopJune 30, 2005 and for the cardinal months ended declination 31, 2005, avocation the calendar year. fiscal Instruments receivable to the pertinence of PAS 32 and 39, the company classified certain investments in shares of stocks as available-for-sale financial assets and valued at fair value, though these has been measured at lower of aggregate cost or market place value in the old GAAP. Refundable deposits on leases and non-interest design car loans were re-measured at fair value at initial recognition and subsequently at amortized value under the effective interest method. earlier to such adoption, these are carried at cost, less impairment in value under previous GAAP.such(prenominal) adoption resulted in a decrease in retained meshing for the company, which may take a shit brought uncomely effects to the company from the point of view of layman financial statement reader. Realizations subsequently analyzing the financial statements of Jollibee Foods potbelly stoves 2005 fina ncial statements to site the issues and problems in their financial reporting in accordance with the PFRS and PAS, this paper presents some realizations about the state of the company struggle to ensure compliance with the Philippine accounting standards under issue in the dressing of the financial statements. In addition, an brainstorm regarding problems in financial reporting is presented. 1. few judgments may not be considered judgments at all.While the company may direct a point in identifying several issues to be as accounting judgments, it may be preferable if such judgments like impairment, leases, and asset retirement be presented under bringing close together uncertainties. This is because this transactions or events commonly require estimations preferably than judgments. 2. elapse au fait with the flex of new standards. It can be assume that the newest retail store of PAS 1 standards relating to capital management may not hitherto noted by the company. Joll ibee must unceasingly get on its sentience of these new standards since it superpower digest a significant posture on how they will present the information to comply with such new standards. Such can be achieved through attention to seminars on PAS and PFRS, and straight training and research. 3. verbosity can lead to fair presentation.Standards gain the say. Sometimes, the notes gain to be redundant in stressing out the emergence of applications, measurement, and valuation of items that are cover by a particular accounting standard (e. g. PAS 14, component reputationing and PAS 18, Revenue, where both standards require the presentation of similar information related to reportable and non-reportable segments). In such case, preparers of financial information have no option but to present the information more than once, as per accord with the standards. 4. depute reconciliations, when necessary. The use of such reconciliations may lead to a go arrangement of the financ ial statements.Showing the movements in the informant and ending balances may already be an important tool to encounter the information related to such reconciliation. 5. convert information with truth and with precision. Preparers of financial statements must exercise due care in convert of information in the soon-to-be promulgated financial statements. Errors resulting from such slovenliness may debauch users of financial information in making economic decisions for the company. 6. Problems are immortal. upstart policies, new standards, new conventions. These lead to problems especially in dealing with the readying of the companys financial statements. glaring compliance possibly difficult. Sometimes, firmness of purpose these problems powerfulness have ominous effects.It sincerely depends on the company on how they are cause to face these situations and eventually set up itself to impending financial reporting problems in the future. References Acuna, C. , Berna ldo, R. , Dy, L. , Malabanan, R. , & Young, L. (2004). A comparative study on the performance and financial position of Jollibee and McDonalds for the years 1999 2006. unpublished undergrad thesis. Manila, Philippines De La Salle University. Jollibee Foods Corporation (2004). Jollibee Foods Corporation annual history 2004. Pasig City, Philippines. Jollibee Foods Corporation (2005). Jollibee Foods Corporation annual Report 2005. Pasig City, Philippines Philippine ground of cognizant reality Accountants (2005). Philippine explanation Standards Vol. 1-5. Mandaluyong City, Philippines.