CLAVERIA WATER DISTRICT Claveria, Cagayan

2015 ANNUAL REPORT

V I S I O N

Envisioned to provide an abundant supply of potable water in every household of

the town of Claveria.

M I S S I O N

To bring an abundant supply of Water to as many Claverianos as possible and

ensuring adequacy and safety of the water provided.

GOALS and OBJECTIVES

The Claveria Water Districts aims to be able to establish a water system that is not

viable but progressive and responsive to the needs of its present concessionaires and

the growing population of Claveria.

CLAVERIA (CAG) WATER DISTRICT No 69 Provincial Road, Centro 02, Claveria, Cagayan

Tel. No. (078) 395-01-83 =====================================================

INTRODUCTION

Claveria Water District was created on April 21, 1982, thru a public hearing under the Administration of the late Mayor Placido Leano. The Water District started its operation on September 1, 1982 with 100 concessionaires, where its operation is governed by PD 198, otherwise known as “Provincial Water Utilities Act of 1973”, as amended under Presidential Decree Nos. 768 and 1479. The decree authorized the formation of Local Water Districts and provided for their government and administration such powers are necessary to optimize public for their service utility operations and for other purpose. Currently, it is serving eleven barangays of the Municipality of Claveria, Cagayan with 1,430 concessionaires.

Since 1992, by virtue of the Supreme Court en banc decision, G.R. No. 95237 (Davao City Water District, et al. vs. CSC et al.), Water Districts were declared Government Owned and/or Controlled Corporations (GOCCs) with original charter and as such under the jurisdiction of the public respondents Civil Service Commission and Commission on Audit.

The District’s primary objective is to supply potable water, which will meet the domestic demand through the creation, operation, maintenance and expansion of reliable and economically viable and sound water supply within the Municipality of Claveria.

In 1992, the District is categorized as small water district, and re-categorized as average water district last April 2008. As of December 2013, the district is classified as Category D, with eight (8) permanent employees under the leadership of General Manager. The Water District is managed trough policies, formulated by its Board of Directors, in accordance with the regulations imposed by the Local Water Utilities Administration, national government and other regulatory bodies.

It is worth mentioning that the District has been a recipient of Most OutstandingWater District under small category for three (3) consecutive years, starting 2002 to 2004, and for the years 2006 and 2007. In 2010, the District has been a nominee for outstanding water district under average water district category.

2. Organizational Set-up, Names and Designations of Key Officials

a. Guillerma I. Martin, MBA - General Manager b. Ms. Dessa May V. Viloria - Accounting Processor B c. Ms. Leticia V. Daquigan - Cust. Service Asst. D d. Mr. Dremio A. Cadang - Welder A e. Mr. Romeo R. Valdez - Driver Mechanic B f. Mr. Armando A. Mesa - Water Resources Fac. Operator g. Stanley Lyell E. Veracion - Administrative Services Aide h. Domingo L. Ramos, Jr. - Utility Worker B 3. Financial Highlights The district’s assets, liabilities and equity are presented below:

2015 2014 Increase/ Decrease

Assets 12,303,416.90 10,775,501.52 1,527,915.38

Liabilities 2,599,880.20 2,843,093.49 (243,213.29)

Equity 9,703,536.70 7,932,408.03 1,771,128.67

The district derives its revenues from water sales. Presented below is a summary of the result of its operations:

2015 2014 Increase/ Decrease

Income 6,030,970.75 5,621,882.04 409,088.71

Expenses 4,375,722.08 3,893,356.57 482,365.51

Net Income 1,655,248.67 1,728,525.47 (73,276.80)

4. Operational Highlights

Indicator 2015 2014 Increase/ Decrease

Total Services Con. 1430 1319 111

Volume of Water Delivered in cu.m. 281,760 269,023 12,737

5. SOCIO – ECONOMIC PROFILE

Province: Cagayan Region: Region 02, Northern Luzon Date Founded: June 05, 1965 Founder: Gov. Gen. Narciso Claveria Official Flower: Rose Income Classification: 3rd Class Municipality

STRATEGIC LOCATION

The Municipality of Claveria is situated at approximately 121`05’ north and 18`35’ east. It lies in the north western part of the Province of Cagayan with an approximate distance of 216 km. from Tuguegarao City, 165 kilometres from Laoag City and 613 kilometres away from Manila via Ilocos Region. It is bounded on the North by the Babuyan Channel, on the east by the municipality of Sanchez Mira, on the West by the Municipality of Sta. Praxedes and on the South by the Province of Apayao (formerly Kalinga Apayao). TOTAL LAND AREA: 19,400 HECTARES NUMBER OF BARANGAYS: 41 (8-Urban; 33-Rural) CLIMATE : Relatively dry from March to August and wet for the rest of the year ACCESSIBILITY

- Accessible by any kind of land transportation even to all its 41 barangays - Concrete surfaced national road, and even most of the provincial and municipal roads - Every barangay with concrete roads and all weather barangay roads

RICH AND ABUNDANT NATURAL RESOURCES

- Vast and fertile agricultural lands suitable for growing palay, coconut, vegetables, root crops, fruits, bananas and other cash crops

- Lush green hills and mountains planted with commercial and indigenous forest and fruit trees, palma brava “labig” trees (only in Claveria)

The Claveria Water District has continued in the effective and efficient mobilization of its services; its employees and officials, its source of funds. Its workforce has been capacitated through trainings and seminars for better delivery of their representatives and functions. It has always the desire to work with healthier, more productive and secured Claverianos and other clients. On the other hand, the CWD has not stopped looking into improving development projects and better services to its people.

Attached are annexes from A to N showing the entire status of the Claveria Water District.

ANNEXES:

A. & B FUNCTIONAL CHART and ORGANIZATIONAL CHART

C. PLANTILLA OF PERSONNEL

D. SUMMARY OF POLICY SETTINGS RESOLUTIONS

E. LIST OF REPORTS PREPARED REGULARLY

1. Monthly Report on Accession

2. Monthly Report on Separation

3. Financial Statements

4. Report on Salaries and Allowances

5. Monitoring of Cash Advances

F. FINANCIAL STATEMENTS

1. BALANCE SHEET – hard copy submitted to Mgt. Advisor Lida Tablo

2. INCOME STATEMENT -– hard copy submitted to Mgt. Advisor Lida Tablo

3. CASH FLOW STATEMENT - hard copy submitted to Mgt. Advisor Lida Tablo

4. COMPOSITION OF CASH AND CASH IN BANK

2015 2014

Cash-Collecting Officer

P 3,140.39 P 34,315.40

Working Fund

5,000.00

5,000.00

Cash in Bank-Savings&Time Deposit-CAMPCI

0

11,330.23

Cash in Bank-Current&Savings Deposit-LBP

4,769,829.36

4,473,805.18

Special Deposit-CAMPCI

118,710.86

255,501.27

Special Deposit-LBP

504,283.49

322,999.43

Sinking Fund-CAMPCI

19,388.61

41,289.07

Sinking Fund-LBP

534,517.35

461,649.03

Provident Fund-CRB

1,284,436.07 1,056,927.59

Total

P 7,239,306.13 P 6,662,817.20

5. STATEMENT OF CHANGES IN EQUITY

CLAVERIA WATER DISTRICT

Condensed Statement of Changes in Equity

As of December 31, 2015

2015 2014

Government Equity, beginning of period

2,698,875.89

2,698,875.89

Additions (Deductions)

Government Equity, end of period 2,698,875.89 2,698,875.89

Retained Earnings, beginning of period

5,233,532.14

3,506,422.67

Prior period adjustments

115,880.00

(1,416.00)

Net Income for the period 1,655,248.67 1,728,525.47

Retained Earnings, end of period 7,004,660.81 P 5,233,532.14

Total Equity 9,703,536.70 7,932,408.03

6. TRIAL BALANCE

December 31, 2015

Particulars Acct. Debit Credit

Cash 102

3,140.39 Working Fund 103 5,000.00 Cash in Bank - CAMPCI # 2541 107 19,388.61 Cash in Bank-LBP SF# 2261-0578-51 107 534,517.35 Cash in Bank-LBP # 2261-1001-81 107 2,926,587.19 Cash in Bank- LBP JSA # 2261-0056-06 107 1,843,242.17 Cash in Bank-LBP Cust. Dep. # 2261-0623-32 107 504,283.49 Cash in Bank-CAMPC1 # 4210 107 118,710.86 Cash in Bank- CRB Prov. Fund # 12719 107 1,284,436.07 Accounts Receivable 111 182,736.52 Installment Sales Receivable 121 48,479.90 Meters 169.1 46,167.96 Service Connection Materials 169.2 155,627.20 Trans/Dis Pipes and Fittings 169.3 171,523.92 Other Deferred Charges 189 17,328.74 Land 201 17,500.00 Plant 203 7,042,735.61 Buildings and Other Structures 204 468,812.99 office Equipment 207 436,338.25 land Transport Equipment 214 75,503.00 Other Machinery and Equipment 225 1,551,144.34 Furniture And Fixtures 226 15,792.00 Books 227 800.00 Construction in Progress - Plant 243 950,448.50 Other Assets- Meters 279 13,650.00 Allowance for Doubtful Accounts 301

83,385.66

Accumulated Depreciation- Plant 303

3,841,724.48 Accu. Dep'n.- Buildings and Other Structures 304

434,559.62

Accu.Dep'n- Office Equipment 307

353,696.54

Accu. Dep'n – Land Transport Equipment 314

69,054.65 Accu.Dep'n- Other Machinery and Equipment 325

1,344,797.41

Accu. Dep'n- Furniture and Fixtures 326

3,259.80 Due to BIR 412

75,470.55

Due to GSIS 412

3,418.65 Due to PHIC 412

81.25

Due to Officers and Employees-Provident 423

1,283,197.68 Due to Officers and Employees-SSS 423-A

4,410.00

Due to Officers and Employees-Retirement Benefits 423-B

50,000.00 Contractor's Security Deposit 424

29,610.00

Current Portion of Long-term Debt 434

530,697.72 Customers Deposit 451

622,994.35

Retained Earnings 481

8,048,288.03 Gen., Transmission and Distribution Inc. (Water Sales) 576

5,467,141.70

Interest Income 612

14,918.90 Other Business and Service Income 618

352,844.30

Fines & Penalties 619

196,065.85 Salaries and Wages 701 1,579,926.18

Personnel Economic Relief Allowance (PERA) 707 43,000.00

ADCOM 708 129,000.00 Representation Allowance 710 60,000.00 Transportation Allowance 711 60,000.00 Clothing and Uniform Allowance 712 30,000.00 Honoraria (Directors' Fees and Renumerations, etc.) 713 97,920.00 Year-end Bonus 714 164,249.00 Other Bonuses and Allowances 719 272,249.00 Life and Retirement Insurance Contributions 721 187,787.16 PAG-IBIG Contributions 722 31,297.86 PHILHEALTH Contributions 723 16,812.50 ECC Contributions 724 8,610.00 Provident Fund Contributions 725 151,672.32 Retirement Benefits - Regular 734 50,000.00 Other Personnel Benefits (Overtime/Holiday Pay) 749 33,631.35 Office Supplies Expense 751 61,989.85 Fuel, Oil and Lubricants Expenses 757 57,927.50 Chemical & filtering Materials 758 78,204.00 Travel Expenses 766 83,197.50 Training Expenses 767 34,900.00 Electricity 769 451,110.19 Fuel 771 7,349.40 Postage and Deliveries 772 1,371.00 Telephone Expenses- Mobile 774 43,500.00 Internet Expenses 775 28,828.66 Advertising, Promotional and Marketing Expenses 778 2,000.00 Taxes, Duties and Licenses 779 113,248.82 Insurance Premiums 781 11,433.90 Representation Expenses 782 31,009.00 Freight & Handling 784 3,450.00 Survey Expenses 787 500.00 Extraordinary & Misc. Expenses 795 10,528.00 Membership Dues and Contribution to Organizations 796 3,528.00 Cultural and Athletic Expenses 797 36,910.00 Corporate Social Responsibility 798 2,907.45 Repairs and Maintenance - Plant (UPIS) 803 13,410.00 Repairs and Maintenance - Buildings and Other Structures 804 11,572.00 Repairs and Maintenance - Office Equipment 807 690.00 Repairs and Maintenance - Land Transport Equipment 814 285.00 Repairs and Maintenance - Other Machinery and Equip 825 3,310.00 Donations 841 4,000.00 Doubtful Accounts Expenses 901 8,778.18 Depreciation - Plant (UPIS) 903 223,432.07 Depreciation - Buildings and Other Structures 904 447.93 Depreciation - Office Equipment 907 36,801.62 Depreciation - Land Transport Equipment 914 1,000.00 Depreciation - Other Machinery and Equipment 925 19,054.34 Depreciation - Furniture and Fixtures 926 2,292.30 Interest Expenses 996 70,600.00

TOTALS

22,809,617.14 22,809,617.14 7. COMPARATIVE BALANCE SHEET

CLAVERIA WATER DISTRICT

Condensed Balance Sheet

As of December 31, 2015

2015 2014

Assets

Current Assets P 7,777,784.71 P 7,289,858.41

Cash and Cash Equivalents (Note 5)

7,239,306.13

6,662,817.20

Receivables (Note 6)

147,830.76

173,938.38

Inventories ( Note 7)

373,319.08

435,774.09

Prepayment and Deferred Charges (Note 8)

17,328.74

17,328.74

Non-Current Assets 4,525,632.19 3,485,643.11

Property, Plant and Equipment, net (Note 9)

4,511,982.19

3,472,353.11

Other Assets (Note 10)

13,650.00

13,290.00

Total Assets 12,303,416.90 10,775,501.52

Liabilities and Equity Liabilities 2,599,880.20 2,843,093.49

Current Liabilities (Note 11)

2,599,880.20

2,324,062.23

Non-Current liabilities (Note 12)

-

519,031.26

Equity 9,703,536.70 7,932,408.03

Total Liabilities and Equity P 12,303,416.90

P 10,775,501.52

8. COMPARATIVE INCOME STATEMENT

CLAVERIA WATER DISTRICT

Condensed Statement of Income and Expenses

As of December 31, 2015

2015

2014

Income P 6,030,970.75 P 5,621,882.04

Business and Service Income

6,030,970.75

5,621,882.04

Expenses 4,375,722.08 3,893,356.57

Personal Services

2,916,155.37

2,566,181.86

Maintenance and Other Operating Expenses

1,388,966.71

1,160,445.22

Financial Expenses

70,600.00

166,729.49

Net Income P 1,655,248.67 P 1,728,525.47

9. COMPARATIVE STATEMENT OF CASH FLOWS

CLAVERIA WATER DISTRICT

Condensed Statement of Cash Flows

As of December 31, 2015

2015

2014

Cash flows from operating activities

Cash Inflows

P 6,351,458.90 P 5,711,558.32

Cash Outflows (3,914,771.57) (3,398,860.46)

Net cash used in operating activities 2,436,687.33 2,312,697.86

Cash flows from investing activities Cash Inflows

Cash Outflows (1,136,374.00) (410,168.00)

Net cash used in investing activities (1,136,374.00) (410,168.00)

Cash flows from financing activities Cash Inflows

Cash Outflows (723,824.40) (822,120.00)

Net cash used in investing activities (723,824.40) (822,120.00)

Net increase (decrease) in cash and cash equivalents 576,488.93 1,080,409.86

Cash, beginning of period

6,662,817.20

5,582,407.34

Cash, end of period P 7,239,306.13 P 6,662,817.20

10. COMPARATIVE STATEMENT OF CHANGES IN EQUITY

CLAVERIA WATER DISTRICT

Condensed Statement of Changes in Equity

As of December 31, 2015

2015

2014

Government Equity, beginning of period

2,698,875.89

2,698,875.89 Additions (Deductions)

Government Equity, end of period 2,698,875.89 2,698,875.89

Retained Earnings, beginning of period

5,233,532.14

3,506,422.67

Prior period adjustments

115,880.00

(1,416.00)

Net Income for the period 1,655,248.67 1,728,525.47

Retained Earnings, end of period 7,004,660.81 P 5,233,532.14

Total Equity 9,703,536.70 7,932,408.03

11. NOTES TO FINANCIAL STATEMENTS

1. Basis of Financial Statements Presentation

Claveria Water District adopts the Commercial Practices System – National Government Accounting

System (CPS-NGAS) Modified Chart of Accounts for water Districts pursuant to COA Circular No.

2004-002 dated April 29, 2004.

2. Summary of Significant Accounting Principles

a. Allowance for doubtful Accounts is maintained at a level adequate to provide for potential non-

collectability of receivables. A review of the receivables, designed to identify accounts to be provided

with allowance, is made on a regular basis.

b. Inventories are valued at cost using the first-in, first-out method (FIFO).

c. Property, Plant and Equipment are recorded at historical cost including installation, survey services,

freight and other incidental expenses incurred in the acquisition less accumulated depreciation.

Depreciation is computed on a straight-line method over the estimated useful life of the properties,

which range from five (5) to fifty years.

d. Construction theory is applied for costing assets utilized in construction. Construction in progress is

used for all expenses in the implementation of project and shall be closed to proper account upon

project completion.

e. Payable accounts are recognized and recorded in the books upon the delivery of the goods or services

rendered.

3. Correction of Fundamental Errors

Errors of prior years are corrected by using the Prior Period Adjustment account and eventually

closed to Retained Earnings at year end. Errors affecting current year operations are charged to

the current year’s account.

4. Cash and Cash Equivalent

a. This account is composed of:

2015 2014

Cash-Collecting Officer

P 3,140.39 P 34,315.40

Working Fund

5,000.00

5,000.00

Cash in Bank-Savings&Time Deposit-CAMPCI

0

11,330.23

Cash in Bank-Current&Savings Deposit-LBP

4,769,829.36

4,473,805.18

Special Deposit-CAMPCI

118,710.86

255,501.27

Special Deposit-LBP

504,283.49

322,999.43

Sinking Fund-CAMPCI

19,388.61

41,289.07

Sinking Fund-LBP

534,517.35

461,649.03

Provident Fund-CRB

1,284,436.07 1,056,927.59

Total

P 7,239,306.13 P 6,662,817.20

b. Cash Collecting Officer includes the undeposited collection of water sales.

c. Working Fund Account represents revolving fund maintained under the imprest system

d. Cash in Bank-Savings and Time Deposit-CAMPCI pertains to the daily collections deposited

prior to October 2001, which are being gradually transferred to LBP Sanchez Mira with the

recommendation of COA.

e. Cash in Bank- Current & Savings-LBP pertains to daily collections of the District from

October 2001 to present.

f. Special Deposit-CAMPCI and Claveria Rural Bank represents deposits made by customers as

security for the payment of their subsequent bills.

g. Sinking Fund CAMPCI and LBP represents one percent of Gross Sales allocated for

replacement of equipment’s and spare parts which are fully depreciated. The amount

deposited at CAMPCI is gradually transferred to LBP Sanchez Mira with the

recommendations of COA.

h. Provident Fund Account includes amount withheld from employee’s salaries as well as the

District’s share.

5. Receivables

a. The amount is composed of the following:

b. The Allowance for Doubtful Accounts is provided in an amount based on the collectability of

receivable balances and evaluation of such factors as aging of the accounts, collection

experiences of the agency, expected loss experiences and the identified doubtful accounts.

The movement in the Allowance for Doubtful Accounts pertains to the Bad Debts Expense

recognized for CY 2014 amounting to P 8,778.18, derived as follows:

Age of Accounts Percentage Amount

1-60 1% 556.22

61-180 2% 281.11

181-1 year 3% 223.49

More than I year 5% 7,717.36

Total 8,778.18

6. Inventories

a. This Account consist of:

2015 2014

Chemicals & Filtering Supply Inventory P 0 P 17,800.00

Maintenance Supplies Inventory

373,319.08 417,974.09

Total Inventories

P 373,319.08

P 435,774.09

2015 2014

Accounts Receivables

P 182,736.52 P 189,940.31

Less: Allowance for Doubtful Accounts

(83,385.66) (74,607.48)

Accounts Receivable, net

99,350.86

115,332.83

Installment Sales Receivables

48,479.90

58,605.55

Total

P 147,830.76 P 173,938.38

b. The Maintenance Supplies Inventory account consists of materials inventory on hand as

well as acquisition of water meter.

7. Prepayment and Deferred Charges

a. This account consists of:

2015 2014

Other Deferred Charges

17,328.74

17,328.74

b. The account Other Deferred Charges pertains to the security deposit to Cagayan Electric

Cooperative-II and Bureau of Telecommunications.

8. Property, Plant and Equipment

This account consists of the following:

2015 2014

Land

P 17,500.00 P 17,500.00

Plant (UPIS)

7,042,735.61

6,698,968.77

Building and Other Structures

468,812.99

468,812.99

Land Transport Equipment

75,503.00

75,503.00

Other Machinery and Equipment

1,551,144.34

1,533,344.34

Office Equipment

436,338.25

435,838.25

Furniture and Fixtures

15,792.00 6,450.00

Books 800.00 0

Construction-in-Progress- 950,448.50 0

Total Book Value

10,541,574.69

9,236,417.35

Less: Accumulated Depreciation

(6,047,092.50) (5,764,064.24)

Net Book Value

P 4,511,982.19 P 3,472,353.11

9. Other Assets

This account pertains to various unserviceable water meters retrieved from previous customer

amounting to P 13, 650.00 as of December 31, 2015.

10. Current Liabilities

a. This includes the following:

2015 2014

Inter-Agency Payables

78,970.45

22,559.32

Due to officers and Employees

1,367,217.68

1,060,099.20

Current Portion of Long Term Debt

530,697.72

664,890.86

Customers' Deposit

622,994.35 576,512.85

Total

P 2,599,880.20 P 2,324,062.23

b. Inter-Agency Payables account includes withholding taxes withheld from payroll, taxes

withheld from purchase of goods and services, premiums to GSIS and PHIC to be paid or

remitted in January 2016.

Inter-Agency Payables is broken down as follows:

2015 2014

Due to BIR

P 75,470.55 P 19,059.42

Due to PHIC

81.25

81.25

Due to GSIS

3,418.65 3,418.65

Total

P 22,559.32 P 22.559.32

c. Due to Officers and Employees includes amount withheld from employees’ salaries as the

water District’s share-provident fund.

d. Customers Deposits represents guaranty deposits equivalent to two (2) months deposit of

concessionaires and corresponding acquisition cost of meters for meter deposits. These

deposits were made by customers as security for subsequent water bills.

11. Non-Current Liabilities

a. This includes Loans Payable representing various loan availments from LWUA since 1991

with different terms of repayments as well as interest, presented as follows:

2015 2014

Loans payable, beginning balance

519,031.26

1,183,931.12

Adjustment: J.V. # 14-12-197

0

(9.00)

Adjustment J.V. # 15-12-230 11,666.46 0

Reclassified under current portion of

Long Term Debt

(530,697.72) (664,890.86)

Loans Payable, ending balance P 0 P 519,031.26

G. SUMMARY H. WATER RATES

I. SUMMARY OF WATER PRODUCTION AND CONSUMPTION

MONTH PRODUCTION CONSUMPTION

JANUARY 21,840 19,760

FEBRUARY 18,727 16,217

MARCH 18,971 16,668

APRIL 25,528 22,938

MAY 23,791 21,502

JUNE 26,434 24,462

JULY 25,265 23,106

AUGUST 26,003 23,411

SEPTEMBER 26,975 24,266

OCTOBER 25,448 23,503

NOVEMBER 22,529 20,770

DECEMBER 23,249 21,552

J. WD WATER SOURCES

- One DEEPWELL

K. SERVICE CONNECTION GROWTH

MONTH NEW RECONNECTED DISCONNECTED GROWTH BAL

JAN 12 6 4 14 14

FEB 1 6 11 -4 10

MAR 11 7 4 14 24

APR 6 7 4 9 33

MAY 11 6 3 14 47

JUN 14 9 0 23 70

JUL 11 6 4 13 83

AUG 14 3 7 10 93

SEPT 5 5 5 5 98

OCT 7 5 1 11 109

NOV 5 3 6 2 111

DEC 4 1 5 0 111

L. LIST OF MAJOR EQUIPMENTS

b. Chlorinator c. Electric motor d. Genset e. Panel Control f. Pump g. Diesel Engine (4RAGD drive)

M. SUMMARY OF BACTERIOLOGIAL ANALYSIS

N. MONTHLY DATA SHEETS

M & N- JANUARY 2015 TO DECEMBER 2015 SUBMITTED TO AREA 1 MANAGEMENT

ADVISOR, MS. LIDA M. TABLO