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ANNUAL REPORT 2009
ACKNOWLEDGMENT
The Aboitiz Foundation, Inc. would like to acknowledge its donors and partners for
helping pursue its mission of helping people help themselves.
INSTITUTIONAL DONORS
INDIVIDUAL DONORS
OTHER DONORS
Aboitiz and Company, Inc.
Aboitiz Construction Group, Inc.
Aboitiz Energy Solutions, Inc.
Aboitiz Equity Ventures, Inc.
Aboitiz Jebsen Bulk Transport Corp.
Aboitiz Land, Inc.
Aboitiz One, Inc.
Aboitiz Power Corporation
Aboitiz Transport System Corp.
Aboitiz Air Transport Corp.
Aboitiz Logistics, Inc.
Aboitiz One Distribution, Inc.
Aboitiz Project T.S. Corp.
Hapag Lloyd
Reefer Van Specialist, Inc.
Total Distribution and Logistics
Systems, Inc.
Zoom In Packages, Inc.
AP Renewables, Inc.
Astir Engineering Works, Inc.
Balamban Enerzone Corp.
City Savings Bank
Cotabato Light & Power Co.
Davao Light & Power Co.
Hedcor, Inc.
Mactan Enerzone Corp.
Pilmico Animal Nutrition Corp.
Pilmico Foods Corp.
Subic Enerzone Corp.
Therma Luzon, Inc.
Visayan Electric Co.
Mr. Antonio R. Moraza
Mr. Enrique Aboitiz
Mr. Enrique M. Aboitiz, Jr.
Mr. Ernesto R. Aboitiz (+)
Mr. Erramon I. Aboitiz
Mr. Iker M. Aboitiz
Mr. Jon Ramon Aboitiz
Mr. Jaime Jose Y. Aboitiz
Mr. Jose Mari Moraza
Mr. Luis Aboitiz
Mr. Mikel A. Aboitiz
Mr. Robert Booth/Ms. Josephine Booth
Mr. Robert Paradies
Mr. Roberto E. Aboitiz
Mr. Sabin M. Aboitiz
Mr. Stephen G. Paradies
Mr. Xavier J. Aboitiz
Mrs. Lulu Aboitiz
Ms. Eukene Aboitiz
ABOITIZ TEAM MEMBERS
(for Typhoon Ondoy)
Abaca Boutique Resort
Affogato Corp.
Cebu International School
Mr. & Mrs. Charles Streegan
Mr. Alberto De Rotaeche
Mr. Emil Rotaeche
Mr. Mariano Perdices
Mr. Richard Canova
Ms. Eleanor Rivera
Ms. Geraldine Richards (+)
Ms. Kathleen Canova Epes
Ms. Lydia Mackenzie
Ms. Maria Canova
Ms. Maria Lourdes Bernardo
Ms. Maribel Antunez
Ms. Patsy Canova
Ms. Stella Escario-Dorion
Pacific Traders and Mfg. Co./Charles
Streegan/Mark Norkoss
Pilar Streegan/Charles Streegan
Salud Borromeo Foundation
Sanfil Management Corp./
Maria Luisa Canova
Windemere Management Corp./
Patsy Canova
PARTNERS
Agro Macro Development Corp.
Annabelle O. Aboitiz
ATR Kim Eng Securities, Inc.
Luis Aboitiz, Jr.
Luzon Hydro Corp.
Mindanao Container Corp.
MRO Development Corp.
Ramon Aboitiz Foundation, Inc.
Renner Development Corp.
Union Bank of the Philippines
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ABOITIZ FOUNDATION
FROM YOUR CHAIRMAN
AND PRESIDENT
The year 2009 saw many countries and companies still reeling from the effects of the global
economic meltdown that began in 2007. The Philippine economy grew just under 1% last
year at a time when the country was still bearing the brunt of the economic challenges.
As a consequence, there was much concern about reduced funding for philanthropic
purposes. However, the Aboitiz Group and the Aboitiz Foundation, Inc. (Foundation)
provided funding totaling π416 million for various projects, the largest amount allocated
by far in the history of corporate social responsibility (CSR) in the Group.
The Foundation’s directly funded allocations for its projects increased from π73 million in
2008 to π79 million in 2009.
Aside from the programs and projects approved for the different Group companies through
the Foundation, the Aboitiz Group companies themselves implemented community
development and infrastructure programs using their own funds for the benefit of the
communities they operate in. From the π314 million released for various social development
activities in 2008, appropriations increased to π337 million in 2009.
These developments translated into more funds being allocated for the Foundation’s key
project areas and other noteworthy initiatives undertaken by different Group companies, in
collaboration with their partner communities.
Since it was established 21 years ago, the Foundation has adopted a strategy that allows it to
focus on three vital areas of social development—education, enterprise development, and
primary health and childcare. Having a focused strategy allows the Foundation to optimize
its efforts and resources in these areas, not only by providing more funds for projects but
also identifying other projects that will complement existing ones.
Due to the compelling need to address environmental concerns to help mitigate the effects
of climate change, the environment will now become the Foundation’s fourth key area of
focus.
What began years ago as scattered tree-planting activities throughout the Group has
been consolidated into one annual nationwide and group-wide tree planting effort.
Watershed management programs and other environment-friendly initiatives have also
been consolidated, with best practices from the various business units coming to the fore.
The Aboitiz Group continues to be actively involved in national organizations like the
Philippine Business for Social Progress, League of Corporate Foundations, Association of
Foundations and the Philippine Council for NGO Certification. It also fully supports the
Coalition for Better Education, a five-pronged program aimed at instituting reforms to
improve the quality of teachers and of the educational system in the country.
The Passion to Serve culture and our mission of helping people help themselves have
become deeply inculcated among all team leaders and team members of the Aboitiz Group.
Their growing participation in various CSR activities has become very evident over the years.
Among these the activities are the simultaneous tree planting, Brigada Eskwela, Adopt-aSchool, cooking and information technology trainings, and various outreach programs.
From your Chairman and President
Due to the compelling
need to address
environmental
concerns to help
mitigate the effects
of climate change,
the environment will
now become the
Foundation’s fourth
key area of focus.
ANNUAL REPORT 2009
In September 2009, Aboitiz companies and Aboitiz family members, through the
Foundation, immediately heeded the plea for help by victims of typhoons Pepeng and
Ondoy, which wrought havoc in Luzon. Their donations to the relief operations totaled
π15 million. Team leaders and team members in companies across the country banded
together to assist in packing and distributing relief goods and other basic necessities.
The Foundation has played a significant role in assisting the ever-growing number of Group
companies in establishing their CSR departments. It trains the CSR teams and coordinates
Group efforts to establish, monitor and measure the impact of the different interventions
in their different localities throughout the country.
To the members of the Aboitiz Foundation team, thank you for your contributions,
dedication and passion to help the less fortunate in society. Continue your valued work
and pursue finding better ways with which we can help our fellow Filipinos uplift their lives.
We would also like to express our sincerest gratitude to all team leaders and team members
of the different Aboitiz Group companies for their personal commitment to
be involved in various outreach activities.
Our most profound thanks also goes to the various donors of the
Aboitiz Foundation for their continued generosity. Without their
help, the Foundation would never have gained the momentum it
presently enjoys.
To the Board of Trustees, thank you for your guidance and
for sharing your time, talent and resources to boost
the Foundation’s efforts to be the neighbor of choice
in the communities we serve.
We are optimistic that with the continued support,
cooperation and partnership of all its stakeholders, the
Aboitiz Foundation will continue to be unrelenting in
fulfilling its mission to help people help themselves.
Erramon I. Aboitiz
Chairman
Jon Ramon Aboitiz
President
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ABOITIZ FOUNDATION
FROM YOUR
MANAGING TRUSTEE
In 2009, the Aboitiz Foundation, Inc. (Foundation) improved its mandate by increasing allocations to
fund more social development initiatives, implement more projects and serve more beneficiaries in its
pursuit to empower communities where Aboitiz Group companies operate.
As the Aboitiz Group grows, so does the Foundation’s mission. With additional companies in our power
group operating in different locations, the Foundation also moved into new locations in 2009.
The Foundation immediately took steps to assist these companies in implementing corporate social
responsibility (CSR) projects—training their CSR teams, helping them align projects with directions
set by the Foundation, and conducting immersion programs and site visits. More expansion is still
expected and consequently new territories for the Foundation to cover.
Two factors have enabled the steady and heady growth of approved allocation for projects over the
years. First, the Aboitiz Group business units that are the Foundation’s main sources of donations
continue to achieve improved business results, allowing them to give bigger donations. Second, these
companies see the effectiveness of the Foundation’s deployment of funds in uplifting the quality of
lives of our beneficiaries.
Education remains the mainstay among the Foundation’s programs. For 2009, education-related
initiatives accounted for π38 million or 49% of total project appropriation. These projects involved
scholarships for students in all levels, new school buildings, computer and library kit donations, among
others.
Enterprise development, specifically our microfinance operations, is another program that has been
getting an increased share of the Foundation’s funds. For 2009, the Foundation approved a total of
π9 million for 18 cooperatives in Cebu.
We are very pleased with how organized groups like cooperatives have utilized well the Foundation’s
soft loans and the learning gained from capacity-building training programs in creating their own
entrepreneurial success stories. Nothing can be more gratifying than seeing seed funding spur a selfsustaining business that provides employment to members of their communities.
Microfinance is one of the program components that the Foundation will continuously grow in the
coming years. Furthermore, our member companies are slowly replicating our microfinance operations
in their local communities.
In the area of primary health and child care, the Foundation allocated π11 million, which accounted for
14% of total budget.
We have also institutionalized employee volunteerism within the Aboitiz Group. This is evidenced
by the simultaneous Group-wide implementation of employee-initiated activities in 2009 like
tree-planting activities, Brigada Eskwela, Christmas outreach, and disaster relief operations. In all,
employee-initiated projects of the Aboitiz Group amounted to π3 million.
The Foundation’s board of trustees, with their vast business experience, has always insisted that
the Foundation be run like an Aboitiz enterprise—responsive to change, attentive to costs, prudent
with resources, and socially responsive. These tenets guide those of us involved in the day-to-day
management of the Foundation and inspire us to strive for constant improvements in our systems and
processes.
On behalf of the Foundation team and the thousands of its beneficiaries, I would like to thank the
members of the board for guiding us in achieving our goals.
To our donor companies, our utmost appreciation for your generosity with resources and time, as well
as your resolve to be a neighbor of choice in the areas where you operate.
To all Aboitiz Group team leaders and team members, our gratitude for the time and effort you
consistently share in the different projects, showcasing your real passion to serve.
To my team, my heartfelt thanks for your dedication and tireless efforts in conceptualizing and
implementing programs and projects that can help uplift the lives of our communities. Truly, you have
made a difference in pursuing our mission of helping people help themselves.
Augusto P.I. Carpio, III
Managing Trustee
From your Managing Trustee
We are very pleased with
how organized groups like
cooperatives have utilized
well the Foundation’s soft
loans and the learning
gained from capacitybuilding training programs
in creating their own
entrepreneurial success
stories.
EDUCATION5
ANNUAL REPORT 2009
Providing public school students with computers and other
educational equipment helps maximize their learning potentials.
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ABOITIZ FOUNDATION
EDUCATION
The Aboitiz Foundation, Inc. (Foundation) continues to advocate better educational
opportunities to help students cope with the demands of today’s increasingly
competitive society.
Education-related projects continued to be the main thrust of the Foundation in
2009. Of the π79 million allocated for projects, π38 million or 49% was used to fund
educational initiatives.
Focus was on infrastructure building, scholarships and financial assistance, and
equipment donations for the integrated computerization program.
INFRASTRUCTURE BUILDING
The Foundation continues building classrooms to address the perennial problem of
classroom shortage in public schools. The availability of classrooms is instrumental in
encouraging more students to go to school. Having rooms that are conducive to learning
help improve students’ performance.
School Building and Classroom Donations
In 2009, the Foundation allocated for the construction of 17 additional classrooms,
bringing to 234 the total number of classrooms donated since its inception. Sixteen
classrooms were turned over to beneficiary schools during the year. The construction of
24 classrooms is presently ongoing, these will be ready for turnover on 2010.
The following table provides an update on the status of these construction projects.
Table 1 - School Buildings
BENEFICIARIES
LOCATION
NUMBERS
OF CLASSROOMS
TURNED OVER
F. Bustamante Mahayag Elementary School
Davao City
Tulian National High School
Davao City
3
Cantipla Integrated School
Cantipla, Cebu City
4
Talamban National High School
Talamban, Cebu City
3
Mabolo Elementary School
Mabolo, Cebu City
TOTAL
3
3
16
APPROVED AND ONGOING
Dalipuga National High School
Iligan City
2
Severo Sara Elementary School
Iligan City
2
Labangon National High School
Labangon, Cebu City
3
Langtad Naga Elementary School
Naga, Cebu
3
Canduman Elementary School
Mandaue City
3
Pulangbato Elementary School
Cebu City
5
Maguikay Elementary School
Mandaue City
3
Pagsabungan Elementary School
Mandaue City
3
TOTAL
Education
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These structures are among the
classroom buildings that the
Foundation turnover in 2009.
The availability of classrooms is instrumental
in encouraging more students to go to school.
Having rooms that are conducive to learning
help improve students’ performance.
ANNUAL REPORT 2009
SCHOLARSHIP AND FINANCIAL ASSISTANCE PROGRAMS
Through the Foundation, selected students from pre-school to college who have academic
potentials but don’t have adequate resources for their education are given scholarship
grants and financial assistance. College graduates from the scholarship program are, at
times, given the opportunity to work in Aboitiz Group companies.
The 2009 Scholarship Portfolio
In 2009, the Foundation sponsored 1,172 students through its different scholarship
and financial assistance programs. The table below enumerates the various programs,
implemented the number of scholars and the geographic distribution of the scholars.
Table 2 - Scholarship and Financial Assistance
LEVEL
Pre-school
LOCATION
Cebu
IMPLEMENTOR
ABOITIZ FOUNDATION
PROGRAMS
Street Education Classes
NUMBER
OF
SCHOLARS
66
Elementary
Cebu
ABOITIZ FOUNDATION
Street Education through the Children of Cebu Foundation
250
Secondary
Lapu-Lapu
ABOITIZ FOUNDATION
Street Urban Working Children of Lapu-Lapu City
180
Lapu-Lapu
ABOITIZ FOUNDATION
STEC scholars
Region 7
ABOITIZ FOUNDATION
High School Valedictorians Scholarship Program
Benguet
HEDCOR
Hedcor HS Scholarship Program
11
192
36
Tarlac
PANC
Fil-Am HS Scholarship Program
Davao
DLPC
DLPC HS Scholarship Program
95
2
Davao
DLPC
Boys Town Ward Scholarship Program
10
Cotabato
CLPC
CLPC HS Scholarship Program
10
Cebu
ABOITIZ FOUNDATION
Aboitiz Foundation's College Scholarship Program
18
Cebu
VECO
Customers' Dependents Scholarship Program
Benguet
HEDCOR
Hedcor College Scholarship Program
3
Iligan
PILMICO
Pilmico Purposive College Scholarship
22
Davao
DLPC
DLPC Customer Dependents College Scholarship Program
69
Cebu and
Davao
ABOJEB
AJMAN Marine Engineering Scholars
10
Post
Baccalaureate
(Nursing)
Cebu
ABOJEB
AJMAN Nursing Scholars
12
Vocational
(Post
secondary)
Cebu
METAPHIL
MTTIT Scholarship Trip
Technical
Cebu
ABOITIZ FOUNDATION
Banilad Center for Professional Dev't. Scholars
Tertiary
8
Others:
TOTAL
169
9
1,172
School buildings and scholarship
grants are given out yearly to
help less privileged but deserving
students achieve their dreams of
finishing school.
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ABOITIZ FOUNDATION
INTEGRATED COMPUTERIZATION PROGRAM
The Foundation recognizes that in this age of information technology, computer literacy
and proficiency are essential. The need to equip students with these skills has prompted
the Foundation to be more aggressive in its campaign to see more schools with access to
computers and the capability to use them.
Through its integrated computerization program, the Foundation aims to satisfy the
demand for computer-literate personnel in workplaces, lower the number of public
schools without computer sets, and push for the integration of computer education into
the curriculum.
Under the program, the Foundation donates computer sets, refurbishes computer
laboratories, and grants multi-media packages to be used by administrators as aid for
teaching.
On an annual basis, the Foundation ensures the program’s continuity by allocating a budget
for the repair and maintenance of the computers. It is also considering subsidizing half the
pay of the teachers who handle computer classes.
Computer-Related Projects
The Foundation and Aboitiz companies donated 123 computer units to schools across the
country in 2009. The donations bring to 972 the total number of units donated since 1999.
Table 3 - Computer Donations
Areas
Donated computers since inception
No. of Units
849
2009 Allocations
Cebu City
33
Cebu Province
29
Agusan Province
24
Davao
25
Benguet
7
Iligan City
5
Total Computers Appropriated
123
Total to 2009
972
The Foundation also refurbished the computer and science laboratories of two schools in
Iligan while 10 Cebu City schools that have been refurbished are just awaiting turnover.
The need to equip
students with
computer literacy
skills has prompted
the Foundation to be
more aggressive in its
campaign to see more
schools with access
to computers and the
capability to use them.
Computer sets are donated to
host communities to complement
existing educational facilities
and help students keep up with
technological advancements.
ANNUAL REPORT 2009
OTHER INTERVENTIONS
Library Kits and e-Learning
Reading opens doors to more knowledge. The Foundation supplements the learning
opportunities of students by donating library kits that contain encyclopedias, storybooks
and other reference materials to develop and encourage the habit of reading.
In 2009, the Foundation, through its member company Pilmico Animal Nutrition Corp.,
donated library kits to four schools in Capas, Tarlac. Since the start of the program, 25
schools have received library kits from different Aboitiz Group companies.
UnionBank Book Donation Program
The “As A Filipino Learning System” (AAFLS), pioneered by member company Union
Bank of the Philippines (UnionBank), seeks to develop students’ reading skills as well as
strengthen the values education curriculum of schools nationwide.
The AAFLS package contains a teacher’s handbook, students’ workbook and a multimedia
set. In 2009, Unionbank distributed a total of 351,304 students’ workbooks and 8,334
teachers’ handbooks to 2,543 elementary schools across the country.
The program was first successfully implemented in 2007 in the National Capital Region.
The Ateneo Teacher Center later announced that a survey conducted among beneficiaries
showed a marked improvement in the students’ academic performance.
Because of its success, the AAFLS program was replicated in Tawi-Tawi and Basilan in
2008 and in Davao, Metro Cebu, and Sarangani in 2009.
Capas Brainshow
The Capas Brainshow, another project of Pilmico Animal Nutrition, yearly brings together
students from all public elementary schools in the municipality of Capas, Tarlac for a quiz
bee.
The project, now on its fifth year, continues to stimulate the mental faculties and bring the
spirit of competitiveness among students in the area.
For 2009, the quiz bee theme was “Batang Capaseño, Karununga’y Palalawigin.”
After four grueling rounds of competition, the team from Lawy Elementary School went
home with the top prize—a computer set and cash for the school as well as for the students.
Vocational and Technical Training Centers
Much as it wants its scholars to earn college degrees, the Foundation recognizes that there
are some students who are unable to pursue formal education due to lack of academic
preparation.
With statistics showing that only three out of 10 high school graduates proceed to college,
the Foundation and member company Aboitiz Construction Group established a welding
training center in Cebu to provide skills and technical training programs in partnership with
the Technical Education and Skills Development Authority (TESDA).
The welding training center has so far trained 638 out-of-school youth, more than half of
whom are employed by Aboitiz member companies.
Baking laboratories and culinary arts rooms have also been established, with more facilities
being eyed for each Cebu school division.
The Foundation also supports
other activities being conducted
to improve the quality of
education in the country.
The Foundation
supplements the
learning opportunities
of students by donating
library kits that
contain encyclopedias,
storybooks and other
reference materials to
develop and encourage
the habit of reading.
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ABOITIZ FOUNDATION
Coalition Building
The Coalition for Better Education (CBE), a non-profit organization established by the
Foundation, Ramon Aboitiz Foundation, Inc. and Philippine Business for Social Progress in
Cebu, continues to support initiatives to institute reforms in the Philippines’ educational
system.
The CBE, the first of its kind in the country, seeks to address five major areas of concern:
teacher training and faculty development, academe-industry-government linkage,
curriculum development, leadership and governance, and educational community.
To date, the CBE has benefited 2,000 students and 48 teachers and principals. One of its
main programs, In.Cube, which involves communities that assist to improve the quality
of education in their locality, was first implemented in Barangay Tayud, Consolacion in
northern Cebu.
The program seeks
to develop the
participants’ leadership,
discipline, interpersonal
communication skills and
spirituality. They are also
taught how to overcome
fear and help care for the
environment.
Outland Adventure Camp
The Outland Adventure Camp, located in Davao City and a project of member company
Davao Light & Power Co., gathers selected students and out-of-school youth for
three days and makes them participate in activities aimed at molding their holistic
development.
The program seeks to develop the participants’ leadership, discipline, interpersonal, and
communication skills and spirituality. They are also taught how to overcome fear and
help care for the environment.
In 2009, 180 participants, chosen based on their potential to become leaders and serve
the community, were given the opportunity to experience the camp and take part in the
activities.
The camp has trained a total of 1,786 participants since it was introduced in 2002.
At the Outland Adventure Camp in Davao
City, selected students and out-of-school
youth participate in activities aimed at
promoting their holistic well-being.
ANNUAL REPORT 2009
ENTERPRISE DEVELOPMENT
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Farmer-beneficiaries tend to their
cornfield to ensure good harvest.
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ABOITIZ FOUNDATION
ENTERPRISE DEVELOPMENT
The Foundation recognizes that one way of empowering communities to help themselves
is to provide them with sustainable income-generating opportunities.
A total of π10 million was allocated in 2009 for enterprise development activities that
include microfinance packages, equipment donation and capability-building initiatives.
The Foundation gives priority to this program area, which benefits small cooperatives
and marginal communities.
The microfinance program, implemented and operating for several years now, has
proven to be very successful. With a collection rate of 96%, the Foundation recoups
funds and uses them to help more potential beneficiaries.
Microfinance
A total of 21 microfinance loan packages, amounting to π9 million, were approved by
the Foundation for 18 partner cooperatives last year, with 7,232 individuals reaping the
benefits. Of the amount approved, only π8 million was released while the remaining
π2 million is due for release in 2010.
With the success of these projects, the Foundation is considering expansion to other
communities in Metro Cebu and selected areas in Davao and Benguet.
Table 4 - Approved Microfinance Loan Packages (in thousand pesos)
BENEFICIARY
AMOUNT
Bayabas United Farmers Association Farm Productivity Project
π126
Cambinocot Multi-Purpose Cooperative Livelihood
765
Cobcawa Multi-Purpose Cooperative Sweet Corn Production
160
Cubacub Level 3 Wwater Supply Expansion Project (ACCESS, Inc.)
500
“Isang Alaga Para Sa Kinabukasan:” Swine Fattening Project of Mactan Island Multi-Purpose Cooperative (MIMPC)
223
LARBA Swine Fattening Project
191
Loan Assistance to Kaponungan sa mga Banikanhong Mag-uuma Alang sa Ekonomekanhong Kalambuan (KABAMEKA)
500
Livelihood Enhancement and Support Services for Barangay Luz Homeowners
409
Mandaue Subcon and Development Multi-Purpose Cooperative
279
Panas Farmers’ Association Swine Fattening Project
191
Pangan-an Island Cooperative for Community Development Swine Fattening Project
341
Pung-ol Sibugay Cutflower and Vegetable Production Project
130
Purok Sili Livelihood Development Project
100
Small Business Development Project for Reunited Shoemakers MPC
500
South Cebu Hog Raisers Multi-Purpose Cooperative Swine Fattening Project
Sta. Rosa Hugpong Kauswagan Multi-Purpose Cooperative
St. Vincent Neighborhood MPC Swine Fattening Project
Uling Multi-Purpose Cooperative Swine Fattening Project
TOTAL
2,700
186
1,647
509
π9,458
The Foundation supports multi-purpose cooperatives by
providing funds and extending other forms of assistance to
ensure the sustainability of the programs they undertake.
Enterprise Development
With the success of the
microfinance program, the
Foundation is considering
expansion to other
communities in Metro Cebu
and selected areas in Davao
and Benguet.
ANNUAL REPORT 2009
Capability-Building Activities
The Foundation also provided assistance amounting to π260,000 to its partner cooperatives
to ensure that these organizations remain structurally sound. The beneficiaries benefited
from capability-building activities like seminars on leadership and internal controls.
Equipment Donation
To boost agricultural activities and support farmers in Capas, Tarlac, Pilmico Animal
Nutrition donated additional irrigation equipment worth π117,000. The Foundation is also
considering incorporating ecologically sound projects, like biodigesters and vermi-based
fertilizers, into its portfolio.
Table 5 - Types of Projects Assisted Through Microfinance (in thousand pesos)
Project Type
Amount
Percentage
π6,832
72%
Farm Production
1,116
12%
Consumer Expansion
500
5%
Water Expansion
500
5%
Others/Kwarta sa Basura
509
6%
π9,458
100%
Swine-Related Activities
TOTAL
The Foundation is also considering incorporating
ecologically sound projects, like biodigesters and
vermi-based fertilizers, into its portfolio.
Multi-purpose cooperatives can expect to
see better results of their projects with the
Foundation promising to allocate more funds for
microfinance enterprises.
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ABOITIZ FOUNDATION
PRIMARY
HEALTH AND CHILD CARE
14
The Foundation continues to identify areas where
water systems are much needed so more people may
have access to clean and potable water.
ANNUAL REPORT 2009
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PRIMARY HEALTH AND CHILD CARE
The Foundation continues to address the shortage of adequate infrastructure facilities
for basic social services. These include water systems, health, day-care and cooperative
training centers, projects that are under primary health and child care.
The Foundation also encourages more street children to go back to the mainstream
educational system. It also provides medical and dental services to the underprivileged.
Having seen the need to improve the quality of life of residents in their host communities,
the Foundation and Aboitiz Group companies continue to implement a variety of projects
to help address these concerns.
The Foundation has so
far donated π7 million
for 18 water systems that
benefit 2,810 households
in different marginalized
communities in Cebu,
Davao and Iligan.
Water systems
Water is a basic necessity not readily available to everyone. Hence, the Foundation has
made the building of water systems the flagship project in the area of primary health and
childcare.
The Foundation has so far donated π7 million for 18 water systems that benefit 2,810
households in different marginalized communities in Cebu, Davao and Iligan. Most of
these water systems are Level 3, which means water is piped directly into the individual
households.
A vital area of focus of the
Foundation is primary health and
child care. Each year, medical
equipment and facilities and
water systems are donated to
host communities nationwide.
In 2009, the Foundation began the construction of a water system for the residents of
Barangay Mulao, Liloan. Due for turnover in October 2010, the system will benefit 150
households.
The Foundation is currently identifying more communities where reliable water connections
are needed.
Donation of Medical Equipment
In order to improve the medical and dental services provided in certain communities, the
Foundation donates a starter set with basic medical and/or dental equipment which poorer
Primary Health and Child Care
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ABOITIZ FOUNDATION
communities cannot obtain on their own. In 2009, the Foundation donated assorted dental
and medical equipment worth π1 million to seven health centers.
Medical and Dental Missions
Aboitiz Group companies, through the Foundation, implement medical and dental missions
aiming to make health services available to their host communities.
AboitizPower subsidiary Hedcor, Inc., Pilmico Animal Nutrition Corp. and Pilmico Foods
Corp. regularly conduct medical missions in their areas of operations.
The Foundation’s goal
is to bring at least
20% of the street
children to get a
formal education the
following school year.
In 2009, 10 dental and medical missions were conducted nationwide.
Street Education Classes
The Foundation hopes to eventually see more children learning in classrooms than roaming
the streets.
By holding non-formal education sessions under the Street Education Classes program, the
Foundation and the Children of Cebu Foundation aim for street children to be motivated to
go to school. The Foundation’s goal is to bring at least 20% of these children to get a formal
education the following school year.
The Foundation supports 250 street children annually by giving them street education
classes. In 2009, these classes were conducted in six urban centers in Metro Cebu. Aside
from these non-formal education, the children were also given bags and other educational
supplies to use in their classes.
Aside from donating equipment
and water systems, the
Foundation also counts medical
and dental missions and street
education classes as part of its
programs to promote primary
health and child care.
17
REPORT 2009
EMPLOYEE-INITIATED CSR PROJECTS AND OTHER ANNUAL
INTERVENTIONS
Employees of Aboitiz Group companies initiate CSR projects
that complement the Foundation’s program.
18
ABOITIZ FOUNDATION
EMPLOYEE-INITIATED PROJECTS
More and more team members in the Aboitiz Group embrace CSR as a part of their
working experience. Hence, it has become an integral part of the Aboitiz employer
branding initiative. Every year, an increasing number of employees volunteer in
different community projects.
In 2009, employees of the Aboitiz Group held simultaneous CSR activities nationwide.
They participated in the groupwide tree-planting activities, and Brigada Eskwela and
Adopt-a-School programs. They also conducted outreach programs and volunteered
in disaster relief operations.
Tree planting
The Foundation and Aboitiz Group companies undertake projects that promote
environmental awareness and protection. One of these projects is the annual tree
planting, where employees plant seedlings of forest and fruit-bearing trees in selected
areas.
In 2009, over 1,800 team members groupwide planted 26,350 seedlings in three areas.
Christmas Outreach Activity
To give the Christmas season more meaning by giving instead of receiving, team
members treated 2,180 underprivileged kids from all over the country where Aboitiz
companies operate to a day of fun, games, food and gifts. The Christian Light
Foundation, which has been the Foundation’s partner in all Christmas outreach
activities nationwide, donated assorted gifts packed in real shoeboxes.
More than a thousand team members took time out to let the children experience the
Christmas spirit.
Employee-Initiated Projects
Team leaders and team members of different
Aboitiz Group companies regularly conduct
tree planting and outreach activities as part
of their programs to promote corporate social
responsibility.
ANNUAL REPORT 2009
Disaster Relief
Never is volunteerism among team members in the Aboitiz Group more evident than
during disaster relief operations; they immediately heed calls for help in times when they
are needed most.
In 2009, team members across the country banded together to donate and gather relief
goods for distribution to victims of typhoons Ondoy and Pepeng, which left a huge part of
Luzon inundated and thousands of families homeless.
With funds mobilized from across the Group, through the efforts of Aboitiz family
members, Aboitiz Group companies and the Foundation, a total of π15 million in assistance
— food items, basic necessities and transport—was provided to the typhoon victims.
Toward the end of the year, residents of Albay province who had to evacuate amid the
looming eruption of Mayon Volcano also received similar assistance.
Brigada Eskwela
For two consecutive years now, Aboitiz team members nationwide have been participating
in Brigada Eskwela, a program of the Department of Education aimed at helping repair and
maintain public schools before the June opening of classes.
In 2009, a total of 462 employees from different Aboitiz Group companies participated in
Brigada Eskwela. They repaired broken chairs and desks, repainted classrooms, spruced up
gardens, cleaned computers and replaced defective lights, among others.
Adopt-a-School
The Adopt-a-School outreach program implemented in Cebu is an employee-initiated
program that provided assistance to Banilad Elementary School and Banilad Night High
School through projects meant to uplift teachers’ competencies.
A π1 million allocation was released for eight training modules to assist students and
teachers of the two schools to improve their Math, English, Science and vocational skills.
Equipment and books were also donated to the school.
The Foundation team quickly responds to
pleas for help from victims of disasters
and calamities, giving out relief goods and
providing other forms of assistance as
needed.
When opening of classes nears, Aboitiz
team members clean up and refurbish
schools in their host communities as part of
their outreach activities.
19
20
ABOITIZ FOUNDATION
CORPORATE DONATIONS AND OTHER INITIATIVES
The Foundation also extends corporate donations and other forms of assistance
to both government and non-government organizations (NGOs) operating in their
respective areas.
For 2009, a total of π13 million in donations was given out.
Support to LGUs
The Foundation recognizes
that local government units
and government agencies
also need assistance to
successfully implement
different projects.
The Foundation recognizes that local government units (LGUs) and government
agencies also need assistance to successfully implement different projects.
In 2009, the Foundation gave out π1 million for infrastructure projects, equipment and
supplies for various LGUs.
Support to Foundations, Promotion of Arts & Culture
Promoting culture, arts and religion and supporting the cause of NGOs are among the
advocacies that the Foundation supports.
The companies released π2 million in financial support to the Sinulog Foundation, Inc.,
Cebu Arts Foundation, NGOs and religious groups, among others.
Sports-related Donations
Supporting sports and other related activities is something that the Foundation and
the companies strongly advocate.
A total of π1 million was donated last year to the Aboitiz Football Cup, Kiddie Chess
Tournament and to the Aboitiz Soccer Field.
Corporate Donations and Other Initiatives
The Foundation also donates
to groups and entities with
noteworthy causes.
ANNUAL REPORT 2009
Environment
The Foundation and Aboitiz Group companies have always been proactive in responding to
calls to take a step further in environment conservation efforts. In fact, environment will soon
become a major program component of the Aboitiz Foundation. Whatever benefits gained in
supporting this advocacy will be beneficial to this generation and beyond.
The succeeding table details the assistance that the Foundation was able to give out in 2009.
Table 6 - Corporate Donations (in thousand pesos)
PARTICULARS
AMOUNT
Arts & Culture
π214
Donations to NGOs, foundations, etc.
2,885
Affiliations/information dissemination
547
Sports-related donations
1,238
Support to LGUs and other agencies
1,081
Disaster relief
4,675
Environment
Employee-initiated projects
TOTAL
Environment will soon
become a major program
component of the Aboitiz
Foundation. Whatever
benefits gained in
supporting this advocacy
will be beneficial to this
generation and beyond.
620
1,622
π12,881
With environment becoming the
Foundation’s fourth key area of focus,
more activities are conducted yearly to
help slow down climate change.
21
22
ABOITIZ FOUNDATION
OTHER COMPANY INITIATIVES
For the Foundation and Aboitiz Group companies, their host communities are their partners
in development. With this mindset, it is imperative for them to take care of the local
communities where their business units operate.
Aside from donations and projects implemented in coordination with the Foundation, these
companies directly fund social development initiatives that address the needs in their
respective areas of operations.
In 2009, the companies donated π337 million to implement these initiatives in their
communities. This is in addition to the projects that they coursed through the Foundation.
Noteworthy is the donation of Tsuneishi Heavy Industries (Cebu), Inc., the shipbuilding
company of the Aboitiz Group, which donated π270 million or 80% of the total amount
for various projects in different barangays in Balamban, Cebu. The amount was spent to
construct and rehabilitate infrastructure projects like schools, markets and water systems.
Educational materials and other equipment were also donated and financial assistance given
to different sectors.
Other Company Initiatives
Aboitiz Group companies
partner with organizations for
the development of their host
communities, like this University
of San Jose-Recoletos (USJR)
Balamban campus built through
an industry-academe partnership
between Tsuneishi Heavy Industries
(Cebu), Inc.and Cebu Industrial Park
Developers, Inc. with USJR.
ANNUAL REPORT 2009
Below is the summary of programs and projects implemented by Aboitiz Group Companies in 2009:
(in thousand pesos)
COMPANY
Group-wide
PROJECT
PBSP contributions
AMOUNT
TOTAL
COMPANY
π1,535
π1,535
East Asia Utilities
Corp.
1,069
1,069
HOLDING COMPANY
Aboitiz Equity
Ventures, Inc.
Projects on Education Scholarship
POWER GROUP
Hedcor Inc.
Projects on Education:
Equipment Donation
Scholarship
Projects on Health concerns
Projects on Environmental
concerns
Assistance to communities
Davao Light
& Power Corp.
Infrastructure Projects in
partnership with LGUs
Projects on Education
Scholarship
Cotabato Light
& Power Corp.
Street Lighting Project
Rural Electrification
Equipment Donations for
Communities
Subic Enerzone
Corp.
SN Aboitiz
Power, Inc.
Luzon Hydro Corp.
STEAG State
Power, Inc.
Cebu Private Power
Corp.
Concerns
Disaster Relief Operations
Assistance to Communities
Infrastructure
Equipment Donation
Project on Health Concerns
Concerns
Equipment Donation
Infrastructure Projects in
Communities
Infrastructure
Equipment Donation
Scholarship
Projects on Health Concerns
Concerns
Infrastructure projects in
Communities
Equipment Donation
Alternative Learning System
Equipment Donation
Scholarship
Concerns
Communities
129
43
125
252
8
Cebu Energy
Development Corp.
557
Western Mindanao
Power Corp.
2,041
938
2,978
1,037
426
14
30
108
15
1,477
154
Southern
Philippines Power
Corp.
473
3,220
2,705
1,698
447
200
San Fernando
Electric Light and
Power Company
5,498
4,414
18,653
Tsuneishi Heavy
Industries (Cebu),
Inc.
4,385
580
150
750
600
620
13,976
GRAND TOTAL
2,700
39
96
9
94
8
693
24
34
29
Scholarship
Educational Support for
Students
Infrastructure
Equipment Donation
Scholarship
Teacher Training
Students
Infrastructure
Equipment Donation
Scholarship
Teacher Training
Students
Communities
Assistance to communities
TOTAL
15
25
30
20
586
5
53
734
445
120
15
580
1,650
509
134
80
10
24
104
142
2,653
904
840
1,006
13
29
31
55
37
2,916
402
402
Equipment Donation
Support to other foundations
and groups
12,000
2,000
950
14,950
Others
300
258
1,775
Equipment Donation
Concerns
AMOUNT
BANKING
Union Bank of the
Philippines
4,794
466
432
1,000
565
PROJECT
1,028
Infrastructure
Equipment Donation
Equipment Donation for
Communities
266,097
1,256
2,518
512
170
270,554
π336,915
23
24
ABOITIZ FOUNDATION
FEATURES
Group bands together for Ondoy and Pepeng victims
A team’s quick and efficient response to calls for help is usually tested in the aftermath of
a natural calamity.
For the Aboitiz Group team, the test came in the morning of Sept. 26, 2009 when typhoon
Ondoy left a major part of Luzon inundated; many cities and towns “sank” as a result of
backed up water, swollen rivers and a Laguna de Bay bursting at the seams.
Ondoy’s onslaught claimed hundreds of lives, left hundreds of thousands of people
homeless and destroyed millions worth of property.
It was a weekend then but the daunting task that presented itself when evening came
signaled that it was time to work.
The Aboitiz Foundation immediately released P1 million in relief goods for distribution to
different evacuation centers. The total amount released eventually reached P15 million,
thanks to the generosity and concern of companies in the Aboitiz Group as well as Aboitiz
family members in the Philippines and abroad.
On the field, the Durian warehouse of 2GO was mobilized as receiving, sorting and releasing
point for Aboitiz relief goods. Volunteers from various companies selflessly heeded the call
for help and showed up to do the myriad tasks of stacking, unpacking, measuring, packing,
and counting in true 2GO fashion. At best, the team was able to release 7,310 relief bags
in one day!
The relief bags themselves were noteworthy because they were reusable and recyclable.
In line with the Group is concern for the environment and sustainability, the Aboitiz
Foundation opted to use bags made of sturdy bonded non-woven material. The general
comment was that our bags were coveted for the completeness of the contents.
Barely two days after Ondoy, the relief team delivered a first batch of 629 packed bags of
relief goods to the Department of Social Welfare and Development. More than 56,000 bags
made their way to the Red Cross, Gawad Kalinga, Ateneo de Manila as well as to various
affected local government units and schools in Marikina, Pasig, Cainta, Taguig, Pateros and
Laguna.
“I’m so proud of the way we have managed to raise funds so quickly and deployed the first
batch of packed goods by Monday afternoon, the first working day after the floods. My
thanks to all the benefactors and to all those who volunteered their time and effort,” said
AEV Chairman Jon Ramon Aboitiz.
Team members of business units across the country—2GO, AboitizPower, SuperFerry,
City Savings Bank, Visayan Electric Co., Davao Light, Hedcor, and SN Aboitiz Power—were
eventually tapped when more hands were needed to hasten the acceptance of donations
and distribution of relief goods.
“The response has been nothing but overwhelming. It is such an inspiration. Out of a dire
situation, the best of our Group has come forth,” said Aboitiz Foundation EVP & Managing
Trustee Sonny Carpio.
Indeed, like sticks in a bundle that are unbreakable, the Group has once again proven that Aboitiz Group team members are not one to
no task is daunting enough not to be accomplished if everyone works together as a team. back down when faced with a challenge as
daunting as immediately helping thousands left
homeless by the fury of typhoons Pepeng and
Ondoy.
Features
ANNUAL REPORT 2009
Coops empower two upland communities
Most multi-purpose cooperatives are born out of the need not only to generate income for its
members but also ensure an organization’s growth through the successful implementation
of sustainable activities.
It is also for these reasons that cooperatives approach organizations and ask them for
assistance, financial or otherwise, in implementing various projects.
In 2009, the Aboitiz Foundation, Inc. granted a total of 21 loan packages to 17 cooperatives
in Metro Cebu to either jumpstart identified projects or ensure the continuity of existing
ones. These loan packages cost a total of π10 million.
Officials of two of these cooperatives— one based in Cebu City and the other in Balamban
town—say they chose to work with the Foundation, confident of the lasting benefits they
will gain from the partnership.
For an organization as small as the Pung-ol Sibugay Multi-Purpose Cooperative, the
P130,000 it received from the Foundation went a long way. Its 84 members, mostly
cutflower and vegetable farmers, were able to either buy fertilizer and pesticides or expand
their plots, enabling them to increase their income.
Wedelisa Gabisay, the organization’s president, says they made the right decision to
approach the Foundation for assistance.
“We didn’t have to wait long to get a feedback on our loan application. What’s more is
that our members who availed of the loan said they earned more than half of their previous
earnings,” Gabisay shares.
The much-bigger Barangay Unity Key to Integrated Development (Bukid) Multi-Purpose
Cooperative, on the other hand, used the π442,000 loan from the Foundation to buy
planting materials and fertilizer, and pay for labor.
Bukid’s members, comprising 152 households, engage in milk and dairy production,
vermiculture and abaca production, spread in over 30 hectares of land in Barangay
Magsaysay, Balamban in the western seaboard of Cebu.
Bukid president Jose Bebelonio Pepito says that because of the loan, the quality of
vegetables and root crops they harvest has now improved.
As for the additional abaca stalks they planted, Pepito says it will take two years for these
to grow. But once fully grown, harvesting of abaca fibers can be done every three months.
Both Gabisay and Pepito say that benefits gained by their members in choosing the
Foundation as their partner have done more than just increase their yield. The partnership,
they share, has given them the opportunity to grow as an organization and help more people
help themselves.
In 2009, the Aboitiz
Foundation granted
a total of 21 loan
packages to 17
cooperatives in
Metro Cebu to either
jumpstart identified
projects or ensure the
continuity of existing
ones.
The Foundation extends financial and other
forms of assistance to selected multipurpose cooperatives nationwide to help
these groups become self-sustaining.
25
26
ABOITIZ FOUNDATION
BOARD OF TRUSTEES
Erramon I. Aboitiz
Chairman
Board of Trustees
Jon Ramon Aboitiz
President
Augusto P.I. Carpio III
Managing Trustee
Roberto E. Aboitiz
Trustee
ANNUAL REPORT 2009
Xavier J. Aboitiz
Trustee
Jaime Jose Y. Aboitiz
Trustee
Roman S. Ronquillo
Trustee
Stephen G. Paradies
Trustee
Sebastian R. Lacson
Trustee
27
28
ABOITIZ FOUNDATION
EXECUTIVE COMMITTEE
Xavier J. Aboitiz
Executive Committee
Jon Ramon Aboitiz
Roman S. Ronquillo
Augusto P.I. Carpio III
Sebastian R. Lacson
ANNUAL REPORT 2009
29
CORPORATE STAFF
Danny Cerence
Rowena Astillo
Carnet Sasuman
Jowelle Ann Cruz
Elena Carnacer
Geraldine dela Serna
Alex Lauron
Not in photo Fred Bayking
Corporate Staff
30
ABOITIZ FOUNDATION
Aboitiz Group CSR Initiatives
As of December 2009 (in thousand pesos)
Projects Undertaken
Amount Allocated
ABOITIZ FOUNDATION, INC.
EDUCATION/SKILLS TRAINING/CULTURE
UNRESTRICTED FUNDS
Infrastructure Aboitiz Foundation,Inc.
Construction of 3-storey,3-classroom School Building of Maguikay NHS
π881
AboitizLand,Inc.
Repairs for Mabolo e-skwela Center
500
Aboitiz Construction Group-Metaphil
Construction of New Classroom for Kindergarten: Arpili Elementary School
808
Pilmico Foods Corporation
Supplemental Budget for the Construction of a 2-classroom School Building 300
Construction of 2-classroom building complete w/tables and chairs
1,300
Construction of Dalipuga School Building Project-Additional Fund
350
Cotabato Light and Power Company
Refurbishment of 2 classrooms of Sultan Kudarat NHS w/arm chairs
330
Davao Light and Power Company
Construction of 3-room School Building in F. Bustamante Mahayag
1,430
Construction of 3-room School Building in Tulalian NHS
1,430
Construction of Library Hub for the 3rd District of Davao City
750
Construction of Science Lab
1,446
Mactan Enerzone
Construction of Prep-Elem School Building
455
Visayan Electric Company
Contruction of School Building - Langtad Elementary School, Naga City, Cebu 2,148
Classroom Repairs -Jagobiao Elementary School, Mandaue City
788
Hedcor Inc.
Construction of One (1) Unit 1 -class room building in
Barangay Catalunan Pequeño, Talomo District, Davao City
335
Scholarship/Financial Assistance
Aboitiz Foundation,Inc.
An Aboitiz Foundation Comprehensive Scholarship Program
3,200
Interventions in Education
500
Regular College Scholarship for Mindanao State University,Iligan Institute
320
Purposive Scholarship for MSU-IIT Iligan City, Central Mindanao University
434
Pilmico Animal Nutrition Corporation
Scholarship for Highschool and College Scholarship Program
for 2HS and 7 College Students in Capas,Tarlac
146
Financial Assistance - Supporting Valedictorian Students
in their Secondary Education In Public HS
60
CLPC Customer’s Dependents Scholarship
150
Scholarshipfor High School Valedicatorians
495
Scholarship for Customer Dependents
1,208
Financial Assistance for Boys Town 150
Financial Assistance - Indigeneous Subsidy
100
Customer’s Dependents Scholarship
505
Hedcor Inc.
Financial Assistance for High School
188
College Scholarship
120
Financial Assistance for Out of School Youth
121
Additional one(1) college scholar for Hedcor Inc., Davao
41
Aboitiz One,Inc.
Scholarship - 2 Go Supply Chain
1,075
Aboitiz Jebsen Bulk Transport Corporation
Marine Engineering Scholarship Program
670
AJMAN Nursing Scholarship Program
330
Skills Training
Skills Training - MTII Reimbursement (June-December 2008)
806
Skills Training - MTII Reimbursement (Jan-June 2009)
491
Skills Training - MTIIT Reimbursement (July-December 2009)
643
DLPC-AFI Skills Development for Physically-Challenged
100
DLPC-AFI Support to the enhancement of
Science and Technology Learning of HS Students in Davao City
250
Financial Assistance - Outland Adventure Camp
483
Computerization
Donation of 25 Computer Units to Public Schools w/in focus Area
450
Computer Repairs
29
IT Training & Competency Program for Teachers
200
Aboitiz IT Trainors Group
50
Computer Donation - 5 units to Luinab Elementary School
150
Computer Repairs & Refurbishments - Northeast II-A Central School,
Severo Sara ES & Luinab ES
150
Computer Inter School Competition
20
Balamban Enerzone
Computer Donation - Buanoy NHS
615
5 sets of computer w/printer to Police Offices situated within the franchise area 125
Community Relation Projects
Equipment Donation - Computers in Davao City
675
Computer Donation to Talamban Elementary School
311
Hedcor,Inc.
Computer Donation
132
Computer Repairs & Maintenance
48
3 units Computer Donation for Catalunan Pequeno NHS in Davao City
81
Aboitiz Energy Solutions
Donation of 6 computer sets each for 2 Schools in Agusan del Sur
150
Donation of 6 computer sets each for 2 Schools in Agusan del Norte
150
City Savings
Computerization project
166
Employee-Initiated Projects
Brigada Eskwela - AEV
56
Brigada Eskwela
50
Brigada Eskwela
55
Aboitiz Power Company
Book Donation,Banilad NHS
36
Learning about Learning: A Worshop Series for Teachers,Banilad NHS
37
Public Speaking & Presentation Skills Training.Banilad NHS
64
SciMathics Club in Action
90
Project BART (Becoming A Responsible Teenager)
96
A Future for Our Teachers: A Cooperative Livelihood Program for Banilad ES PTA107
Project LEAD: A Leadership Skills and Organization
Management Development Program
123
Livelihood & Entrepreneurial Skills Project for NHS Students
334
Brigada Eskwela
240
Educational Upliftment -Lataban Elementary School
554
Equipment and Book Donations
Upgrading of Electrical System in Banilad ES
370
AboitizLand,Inc.
Library Kit Donation for Don Calixto C. Yongco Tawason ES
100
Donation of Training Materials for Subangdaku Vocational HS Test Plates
87
Acquisition of Science Lab Apparatus
200
Library Kit Donation in 2 Public Elementary School in Capas,Tarlac
170
Library Kit Donation in High School in Capas, Tarlac
100
Library Refubishment in 1 Public Elementary School in Capas Tarlac
130
Upgrading of Electrical System in Florencio Urot MHS
423
Aboitiz One,Inc.
Adopt A School - Sustaining Activities
300
Support to Teachers
Financial Assistance to 2 Kindergarten teachers and 1 Nursery Teacher
of Severo Sara Memorial
143
Financial Assistance to 3 Computer Teachers
234
Hedcor,Inc.
Teacher Training for Elementary School Teachers
75
Honorarium for Computer Teachers
100
Others
Financial Assistance to Day Care Center of Tag-ibo,Iligan City
100
Financial Assistance to Refresher course/Summer Classes
for Northeast II - A Central School and Sara Memorial School
70
Educational Enhancement Program
500
Brainshow 2009
130
Brainshow 2009 - Additional Funds for Public ES in Capas,Tarlac
70
Adopt-a-school Launching
65
Balamban Enerzone
Adopt A School - Career Orientation & Environmental Awareness
25
Sub-Total - Unrestricted
34,573
RESTRICTED FUNDS
AOA Educational funds
Scholarship Program
STEC Scholarship 2009
Iker Aboitiz Fund
Scholarship Program
SGP Fund
Scholarship Program
Luzon Hydro Corporation
Scholarship Program
Pilikao Funds
Elementary School Building Repair in Luz Banzon and Solano
PKL High School Scholarship Program
Sub-Total - Restricted
2,502
281
72
32
428
418
140
3,873
ANNUAL REPORT 2009
ENTERPRISE DEVELOPMENT UNRESTRICTED FUNDS
Grant Aboitiz Foundation,Inc.
Capability Building Training Program for Exisitng Coop Partners
229
AboitizLand,Inc.
Livelihood Training on Culinary Arts
30
Additional Irrigation Equipment for the Neighboring Farmers
of FFI Farms for the Farmers from Sitio Gullman,Brgy.Sto. Rosario
(Nucleus Farm)& Sitio Kawili-wili,Brgy. Cut-cut,Capas,tarlac(Farm3)
117
Microfinance
South Cebu Hog Raisers
900
South Cebu Hog Raisers
1,800
Reunited Shoemakers Coop
500
Mactan Island Coop
223
KABAMEKA
400
KABAMEKA
100
Cubacub Level 3 Supply Expansion Project(ACCESS,Inc.)
500
Uling MPC Swine Fattening Project
509
Cambinocot MPC Livelihood
765
Purok Sili Livelihood Development Project
100
Pung-ol Sibugay Cutflower and Vegetable Production Project
130
LARBA Swine Fattening Project
191
Panas Farmer’s Association Swine Fattening Project
191
Livelihood Enhancement and Support Services for Brgy. Luz Homeowners
410
Pangan-an Island Cooperative for Community Development
Swine Fattening Projects
341
Mandaue Subcon and Development MPC
279
Sta. Rosa Hugpong Kauswagan MPC
186
St. Vincent Neighborhood MPC Meat Processing
1,148
St. Vincent Neighborhood MPC Meat Processing
500
Cobcawa MPC Swet Corn Production
160
Bayabas United Farmers Association (BUFA) Farm Productivity Project
127
9,836
PRIMARY HEALTH AND CHILD CARE
UNRESTRICTED FUNDS
Street Education Class 2009
211
Water System - Mulao Liloan Water System Project
495
Medical Mission at Brgy.,Dalipuga,Donald Moraza Park MPC Building
200
Astig Ka Boy!(Free Circumcision) to all Residents of
Brgy. Sto. Rosario,Capas,Tarlac
39
Ngiting Kumukutitap (Dental Mission) to the
Residents of Brgy.,Aranguren,Capas,Tarlac
35
Isang Malinao na Pasko (Free Eye Check-up & Eyeglasses) to
10 students per school from selected public Elementary Schools in Capas,Tarlac 36
Subic Enerzone
Adopt An Ambulance
100
Mactan Enerzone
Water System - Repair of Water System in Agus Elementary School
74
Hedcor,Inc.
Medical Missions
336
Donation of GI Pipes for the Rehabilitation of Amsalsal Water System
27
Installation of Ceilling Wall for Banengbeng Day Care Center
28
Construction of One (1) Unit 1-room conventional comfort room for
Brgy., Mintal Health Center,Brgy.,Mintal Tugbok District,Davao City
52
1,633
RESTRICTED FUNDS
Construction of Proposed Feeding Center,Mabini
4,284
Rogationist Seminary
16
Justice Peace Integrity of Creation Integrated Dev. Center
600
A. O Aboitiz Donations
324
Cebu Hope Center
1,020
Don Bosco Boys Home
600
Philippine National Red Cross
60
Sisters of the Sacred Heart of Jesus and Mary
360
Missionaries of Charity c/o A.O.Aboitiz
300
Missionaries of Charity 24
Good Shepherd c/o Luis Ugarte Fund
17
Bishop Juan De Dios Pueblos
2,000
We Do Recover, Inc.
10
Medical and Dental Outreach Program
160
Iron for Banilad Elementary School
42
9,817
AFFILIATION AND INFORMATION DISSEMINATION
UNRESTRICTED FUNDS
Aboitiz Foundation
Philippine Council for NGO Certification
2
Philippine Council for NGO Certification - sponsorship
50
League of Corporate Foundations
25
League of Corporate Foundations - CSR Expo 2009
100
League of Corporate Foundations - CSR Expo 2009
56
Association of Foundations
80
Annual Report 2008
260
Ramon Aboitiz Foundation,Inc (ALEX)
20
Coalition for Better Education
16
609
CORPORATE AND OTHER DONATION
UNRESTRICTED FUNDS
Support to LGUs
Mabolo Police Station Signage Repair
28
2 units 20 ft. Container Vans for the Mactan Bridge & Marcelo B. Fernan Bridge 120
Assistance to Dalipuga Fire Department
100
Assistance to Canaway Garbage Dump Site
100
Donation to Hospital Equipment
200
Community Peace and Order in Dalipuga,Iligan City
180
Calamity Fund
100
Hedcor,Inc.
Computer Donation-2 Barangays
50
Subic Enerzone
Construction of Police Guard
331
Disaster Relief - Typhoon Ondoy
6,382
Fabrication of Aboitiz Foundation Ecobags
200
Umapad Mandaue City Relief Goods for 693 Families (Fire Victims)
150
Support to other NGOs and Groups
Sinulog Foundation 2009
100
Sinulog Foundation 2010
100
PBSP - Olango Challenge:Swim for A Cause
50
Boy Scout of the Phils.
20
Association of Foundation
50
Cebu Arts Foundation
14
Junior Achievement of the Philippines Foundation
30
Annual Benefit Lunch - Children’s Hour Phils.
15
First Gentleman Foundation,Inc.
1,000
Cebu Metropolitan Cathedral
500
Gawad Kalinga in Kiwalan,Iligan City
150
Church Repairs of San Roque Church in Tag-ibo,Dalipuga,Iligan City
100
Environment
Festival of Trees
100
Aboitiz Group Reforestation Site Maintenance Project
30
Davao Light and Power Company Punta Dumalag Regreening Project
225
Hedcor,Inc.
Orientation on Saving the Rivers Through Proper Waste Disposal
59
Cleanest & Greenest ES
45
Employee - Initiated projects
Cebu Christmas Outreach 2009
50
Makati Christmas Outreach 2009
40
AboitizLand,Inc.
Aboitiz Groupwide Tree Planting
42
Chistmas Gift Giving Activities in Talisay City and Gabi,Cordova
200
Gift Giving Activities
150
Mangrove Reforestation
35
Tree Planting Activity
50
Tree Planting 2009 in Sitio Kawili-wili,Brgy. Cut-Cut II Tarlac
40
Aboitiz Groupwide Tree Planting - Metro Manila
467
Aboitiz Groupwide Tree Planting - Metro Cebu
498
Sports-related Projects Aboitiz Foundation,Inc.
Aboitiz Football Cup - Cebu Football 2009
690
Amortization for Aboitiz Sports Field
500
AboitizLand,Inc.
Kiddie Chess Tournament
48
Other Donations
Cebu Media Party
30
Contingency Fund to Support other Possible Projects
50
Discretionary Fund
1,000
14,419
RESTRICTED FUNDS
First Gentleman Foundation, Inc.
4,000
Christian Light Foundation,Inc.
150
Disasters Relief-Typhoon Ondoy-SGP
50
4,200
TOTALS UNRESTRICTED FUNDS
RESTRICTED FUNDS
Sub-Total - Aboitiz Foundation
OTHER COMPANY INITIATIVES
(see table on p.22)
TOTAL CSR FOR THE ABOITIZ GROUP
61,070
17,890
78,960
336,915
415,875
31
32
ABOITIZ FOUNDATION
The Year 2009 in Figures and Graphs
Aboitiz Group CSR Initiatives (including Aboitiz Foundation)
Nationwide
Nationwide Iligan
Iligan Sarangani
4%
1%
Subic
Sarangani 1%
4%
Subic
0% Pampanga
Zamboanga 1%
1%
0% Pampanga
Zamboanga
1%
0%
1%
0%
Tarlac
Misamis
Tarlac
0%
Misamis
1%
0%
1%
Cotabato
Cotabato
1%
1%
Manila
Manila
3%
3%
Benguet
Benguet
4%
4%
Isabela
Cebu
Isabela
4%
Cebu
76%
4%
76%
Davao
Davao
4%
4%
Per location
Cebu
Davao
Cebu
Cotabato
Subic
Davao
Isabela
Cotabato Benguet
Misamis
Subic
Zamboanga
Isabela
Sarangani
Benguet Pampanga
Manila
Misamis
Iligan
ZamboangaTarlac
SaranganiNationwide
Pampanga Total
Manila
Iligan
Tarlac
Nationwide
Total
Total
Cebu
318,015,351
Davao
14,886,058
Cotabato
2,251,573
Subic
585,082
Isabela
18,653,259
Benguet
15,732,900
Misamis
2,700,015
Zamboanga
2,652,620
Sarangani
2,915,764
Pampanga
401,571
Manila
14,153,000
Iligan
5,886,000
Tarlac
1,068,000
Nationwide
15,974,000
Total
415,875,193
Corporate and
Corporate and
Other Donations
Other Donations
12%
12%
Affiliation and
Affiliation and
Info. dissemination
Info. dissemination
0%
0%
Primary Health
Primary Health
and Child Care
and Child Care
4%
4%
Enterprise
Developmet
3%
Enterprise
Developmet
3%
Education
81
Education
81
Per program component
Total
318,015,351
TOTAL
14,886,058
2,251,573
π318,015
585,082
14,886
18,653,259
15,732,900
2,252
2,700,015
585
2,652,620
2,915,764
18,653
401,571
15,733
14,153,000
5,886,000
2,700
1,068,000
2,653
15,974,000
Total
TOTAL
Total
336,065,514
Education
Education
π336,065
336,065,514
Education
Enterprise Developmet
14,300,250
Enterprise Developmet
14,300,250
Enterprise
Developmet
Primary
Health and Child Care
14,680,747 14,300
Primary Health and Child Care
14,680,747
Affiliation
and Info.
dissemination
609,000 14,681
Primary
Health
and
Child
Care
Affiliation and
Info. dissemination
609,000
Corporate and Other Donations
50,219,682
Corporate and Other
Donations
50,219,682
Affiliation
and
Info.
415,875,193
dissemination
609
415,875,193
Corporate and Other Donations
50,220
Total
π415,875
2,916
402
14,153
5,886
1,068
15,974
π415,875
415,875,193
Aboitiz Foundation, Inc.
Corporate and
Other Donations
23%
Affiliation and
Info. dissemination
1%
Education
49%
Primary Health
and Child Care
15%
Enterprise
Developmet
12%
TOTAL PER PROGRAM COMPONENT
Per program component
Per location
Cebu
Iligan
Cotabato
Davao
Tarlac
Benguet
Manila
Others
total
2009 Figures and Graphs
TOTAL
π43,950
5,686
715
10,251
1,068
1,757
14,078
1,455
π78,960
Corporate and
Other Donations
23%
Affiliation and
Info. dissemination
1%
Primary Health
and Child Care
3%
Enterprise
Developmet
16%
Corporate and
Other Donations
23%
TOTAL
Education
Primary Health and Child
care
Affiliation and Info
Education
Dissemination
57%
Corporate and Other
Donations
Total
UNRESTRICTED PER PROGRAM COMPONENT
π38,446
Affiliation and
9,836
Info. dissemination
0%
11,450
Education
22%
Primary Health
and Child Care
5%
609
18,619
π78,960
Enterprise
Developmet
0%
RESTRICTED PER PROGRAM COMPONE
ANNUAL REPORT 2009
33
INDEPENDENT AUDITOR’S REPORT
The Members and the Board of Trustees
(Formerly, Aboitiz Group Foundation, Inc.)
(A Non-Stock, Non-Profit Organization)
Aboitiz Corporate Center
Gov. Manuel A. Cuenco Avenue
Cebu City
We have audited the accompanying financial statements of ABOITIZ
FOUNDATION, INC. (Formerly, Aboitiz Group Foundation, Inc.), which comprise
the statements of financial position as at December 31, 2009 and 2008, and
the statements of comprehensive income, statements of changes in equity
and statements of cash flows for the years then ended, and a summary of
significant accounting policies and other explanatory notes.
Management’s Responsibility for the Financial Statements
Management is responsible for the preparation and fair presentation of
these financial statements in accordance with Philippine Financial Reporting
Standards. This responsibility includes: designing, implementing and
maintaining internal control relevant to the preparation and fair presentation
of financial statements that are free from material misstatement, whether
due to fraud or error; selecting and applying appropriate accounting policies;
and making accounting estimates that are reasonable in the circumstances.
Auditor’s Responsibility
Our responsibility is to express an opinion on these financial statements
based on our audits. We conducted our audits in accordance with Philippine
Standards on Auditing. Those standards require that we comply with ethical
requirements and plan and perform the audit to obtain reasonable assurance
whether the financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the
amounts and disclosures in the financial statements. The procedures selected
depend on the auditor’s judgment, including the assessment of the risks of
material misstatement of the financial
statements, whether due to fraud or error. In making those risk assessments,
the auditor considers internal control relevant to the entity’s preparation
and fair presentation of the financial statements in order to design audit
procedures that are appropriate in the circumstances, but not for the purpose
of expressing an opinion on the effectiveness of the entity’s internal control.
An audit also includes evaluating the appropriateness of accounting policies
used and the reasonableness of accounting estimates made by management,
as well as evaluating the overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and
appropriate to provide a basis for our audit opinion.
Opinion
In our opinion, the financial statements present fairly, in all material respects,
the financial position of ABOITIZ FOUNDATION, INC. (Formerly, Aboitiz Group
Foundation, Inc.) as of December 31, 2009 and 2008, and of its financial
performance and its cash flows for the years then ended in accordance with
Philippine Financial Reporting Standards.
LUIS CAÑETE & COMPANY
LUIS A. CAÑETE
Partner
CPA Certificate No. 6507
BOA/PRC Reg. No. 0127 (Until December 31, 2010)
SEC Accreditation No. 00105-AR-1 (In Process of Renewal)
TIN 114-622-040, BIR AN 13-004894-1-2009
PTR No. 9665242 – January 04, 2010, Cebu City
___________
Cebu City
EXHIBIT “A”
STATEMENTS OF FINANCIAL POSITION
December 31, 2009 and 2008
(Amounts Expressed in Whole Philippine Pesos)
Note
2009
2008
ASSETS
CURRENT ASSETS
Cash
Receivables
3
4
π2,151,538
122,191,395
π1,299,756
68,805,045
124,342,933
70,104,801
4
-
552,000
5
6
7
8
9
36,000,000
41,224,645
1,150,717
570,930
44,821,020
23,204,422
414,384
1,584,290
28,901,391
123,767,312
54,656,487
π5,014,005
44,821,020
π56,053
28,901,391
49,835,025
198,275,220
28,957,444
95,803,844
π248,110,245
π124,761,288
Total Current Assets
NON-CURRENT ASSETS
Receivables - non current
portion
Held to maturity investments
Available for sale investments
Office furniture and equipment
Other assets
Trust funds
Total Non-Current Assets
LIABILITIES
Accounts payable
Deferred credits
10
11
Total Liabilities
EQUITY (Exhibit “C”)
TOTAL LIABILITIES AND FUND BALANCE
(See accompanying notes to financial statements)
EXHIBIT “B”
STATEMENTS OF COMPREHENSIVE INCOME
For the Years Ended December 31, 2009 and 2008
Note
SUPPORT AND REVENUES
Donations received
Donated services Interest
income
Dividend income Miscellaneous
income
EXPENSES
Donations made
Salaries and honoraria
Interdepartmental services
Depreciation
Training and seminars
Rent
Professional fees
Production of annual report
Supplies and materials
Project expenses
Communication
Medical and hospitalization
Fuel and Lubricants
Light and water
Interest expense
Repairs and maintenance
Taxes and licenses
Retirement benefits
Miscellaneous
12
6
13
14
2009
2008
π166,385,849
165,000
2,681,429
1,141,242
104,126
π66,930,098
265,000
2,791,084
2,091,764
6,000
170,477,646
72,083,946
76,345,447
4,010,409
1,558,294
384,596
289,984
270,297
244,930
232,000
218,475
214,289
175,122
161,669
27,082
103,174
101,165
49,611
14,218
1,525,731
64,174,249
3,425,989
1,246,098
300,787
269,958
280,002
25,788
485,200
125,535
257,339
128,839
287,061
115,694
112,535
2,317
101,665
20,006
281,286
1,463,815
86,026,493
73,104,163
EXCESS OF REVENUES OVER
EXPENSES (EXPENSES OVER
REVENUES)
84,451,153
(1,020,217)
OTHER COMPREHENSIVE INCOME
(LOSS)
Change in fair value of available
for sale securities
18,020,223
TOTAL COMPREHENSIVE INCOME
(LOSS) FOR THE YEAR
(8,437,669)
P102,471,376
(P9,457,886)
Independent Auditors’ Report
34
ABOITIZ FOUNDATION
EXHIBIT “C”
STATEMENTS OF CHANGES IN EQUITY
Fund Balance
Balance at January 01, 2008
Total Equity
π8,199,108
π103,766,605
(8,437,669)
(1,020,217)
(8,437,669)
(8,437,669)
(9,457,886)
π95,567,497
Excess of expenses over revenues
Other comprehesive loss
Total comprehensive loss for the year
Unrealized Gain
(loss) on
Available For Sale
Investment (Note 6)
(1,020,217)
(1,020,217)
Adjustments
1,495,125
-
1,495,125
Balance at December 31, 2008
P96,042,405
(P238,561)
P95,803,844
Balance at January 01, 2009
π96,042,405
(π238,561)
π95,803,844
18,020,223
84,451,153
18,020,223
Excess of revenues over expenses
Other comprehensive incom
Total comprehensive loss for the year
Balance at December 31, 2009
84,451,153
84,451,153
18,020,223
102,471,376
π180,493,558
π17,781,662
π198,275,220
EXHIBIT “D”
2009
2008
π84,451,153
(π1,020,217)
384,596
(2,681,429)
(1,141,242)
(104,126)
68,667
300,787
(2,791,084)
(2,091,764)
281,286
48,178
Operating cash flow before working fund changes
Decrease (increase) in:
Accounts receivable
Loans receivable
Other assets
Increase in accounts payable
80,977,619
(5,272,814)
(65,779,111)
12,944,761
1,385,799
4,957,952
1,011,568
1,996,775
(2,325)
17,013
Cash provided by (used in) operations
Contribution to retirement fund
Interest received
Income tax paid
34,487,020
(25,364)
2,441,718
(71,905)
(2,249,783)
(220,288)
1,407,609
(61,344)
Net cash provided by (used in) operating activities
36,831,469
(1,123,806)
CASH FLOWS FROM INVESTING ACTIVITIES
Proceeds from sale of asset
Acquisition of held to maturity investments
Capital expenditures
Cash dividends received
(36,000,000)
(1,120,929)
1,141,242
62,760
(262,182)
2,091,764
Net cash provided by investing activities
(35,979,687)
1,892,342
CASH FLOWS FROM FINANCING ACTIVITIES
-
-
851,782
768,536
NET INCREASE IN CASH
CASH BALANCE AT BEGINNING OF YEAR
CASH BALANCE AT END OF YEAR
1.
1,299,756
531,220
π2,151,538
π1,299,756
CORPORATE INFORMATION
The Aboitiz Foundation, Inc., (the “Foundation”) is a nonstock, non-profit foundation organized under Philippine laws
in 1978 with corporate name ACO Foundation, Inc. Its articles of
incorporation was amended changing its name to Aboitiz Group
Foundation, Inc. and on May 7, 2008 to Aboitiz Foundation, Inc.
The office of the Foundation is located at the Aboitiz Corporate
Center, Gov. Manuel A. Cuenco Avenue, Cebu City.
The Foundation is primarily a socio-economic assistance body;
as such it operates exclusively for charitable, social welfare,
religious, scientific, cultural, non-formal educational, and
youth and sports development purposes.
The financial statements of the Foundation as of and for the
year ended December 31, 2009 (including the comparatives for
the year ended December 31, 2008) were authorized for issue
by the Board of Trustees on March 10, 2010.
2.
STATEMENTS OF CASH FLOWS
CASH FLOWS FROM OPERATING ACTIVITIES
Excess of revenues over expenses (expenses over revenues)
Adjustments for
Depreciation
Interest income
Dividend income
Retirement benefits expense (unrealized pension income)
MCIT written-off
STATEMENTS OF FINANCIAL POSITION
December 31, 2009 and 2008
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND
SIGNIFICANT ACCOUNTING ESTIMATES AND ASSUMPTIONS
Basis of Preparation.
The financial statements of the Foundation have been
prepared under historical cost basis modified by the fair
value measurement of available for sale investments and are
presented in whole Philippine pesos.
Statement of Compliance.
The financial statements have been prepared in accordance
with the Philippine Financial Reporting Standards (PFRS).
Accounting Changes.
The Foundation has adopted revised PFRS, amendments to
and improvements to PFRS, and Philippine interpretations as
follows:
• Revised standards and amendments PFRS which have no
effect in recorded amounts but have affected presentation
and disclosure of financial statements:
PAS 1, “Presentation of Financial Statements” (as revised in
2007) introduces terminology changes (including revised
titles for the financial statements) and changes in the format
and content of the financial statements. It introduces a new
statement of comprehensive income that combines all items
of income and expenses recognized in the profit or loss
together with ‘other comprehensive income’. Entities may
choose to present all items in one statement, or to present
two linked statements, a separate statement of income
and a statement of comprehensive income. In addition, it
requires the presentation of a statement of financial position
as at the beginning of the earliest comparative period when
an entity restates its financial statements or retrospectively
applies a new accounting policy.
The Foundation has opted to present all items of income
and expenses recognized in a period in a single statement
of comprehensive income. Among the other changes are the
ANNUAL REPORT 2009
replacement of balance sheet with statement of financial
position and cash flow statement with statement of cash
flows.
Amendments to PFRS 7, Financial Instruments Disclosures
has expanded the disclosures required in respect of fair value
measurements and liquidity risk. It requires, for each class of
financial instruments measured at fair value, to be disclosed
by the source of the inputs in determining fair value using a
three level hierarchy. Amendments to the minimum liquidity
risk disclosures include the recording of issued financial
guarantee contracts in the contractual maturity analysis
based on the maximum amount guaranteed and allocated to
the earliest date they can be drawn down irrespective of the
likelihood that the guarantees will be drawn or the amount
expected to be paid and disclosure of a maturity analysis of
financial assets that an entity holds for managing liquidity
risk. Additional disclosure on maturity analysis of financial
asset is included in Note 18.
• Amendments and improvements to PFRS and Philippine
interpretations with no effect in the financial statements
but may
affect future transactions of the Foundation:
• PFRS 2, Share–based Payment–Vesting Condition and
Cancellations (Amendment)
• Philippine Interpretation IFRIC 9, Reassessment of
Embedded Derivatives, and PAS 39, Financial instruments:
Recognition Measurement – Embedded Derivatives
(Amendment)
• PAS 23, Borrowing Costs – Revised
Improvements to PFRS
• PAS 1, Presentation of Financial Statements.
• PAS 16, Property, Plant and Equipment.
• PAS 19, Employee Benefits.
• PAS 23, Borrowing Costs.
• PAS 36, Impairment of Assets.
• PAS 39, Financial Instruments: Recognition
Measurement.
and
Future Accounting Changes.
The following Philippine interpretations and improvements to
the standards which have been issued but are not yet effective
but may affect future transactions of the Foundation are as
follows:
Effective 2010.
Philippine Interpretation IFRIC 17, Distribution on Non-cash
Assets to Owners (effective for periods beginning on or after
July 1, 2009) provides guidance on the appropriate accounting
treatment when an entity distributes assets other than cash
to shareholders either as a distribution of reserves or as
dividends. It requires an entity to recognize a liability for the
distribution when it is no longer at the discretion of the entity
(i.e., when shareholder approval is obtained, if required). The
liability is initially recognized at the fair value of the assets to
be distributed and is re-measured at the end of each reporting
period and immediately before settlement. At settlement date,
the difference between the carrying amount of the assets to
be distributed and the liability is recognized in profit or loss as
a separate item.
Improvements to PFRS (issued 2009) (effective for periods on
or after January 1, 2010, unless stated otherwise)
35
PAS 7, Statement of Cash Flows – Classification of expenditures
on unrecognized assets
• Only expenditure that results in a recognized asset can be
classified as a cash flow from investing activities.
PAS 17, Leases – Classification of land and buildings
• The specific guidance on classifying land as a lease has been
removed so that only the general guidance remains.
PAS 39, Financial Instruments: Recognition and Measurement
Assessment of loan prepayment penalties as embedded
derivatives
• A prepayment option is considered closely related to the
host contract when the exercise price reimburses the lender
up to the approximate present value of lost interest for the
remaining term of the host contract
Effective 2013.
PFRS 7, Financial Instruments, specifies how an entity should
classify and measure financial assets, including some hybrid
contracts. This standard requires all financial assets to be:
(a) classified on the basis of the entity’s business model for
managing the financial assets and the contractual cash flow
characteristics of the financial asset; (b) initially measured at
fair value plus, in the case of a financial asset not at fair value
through profit or loss, particular transaction costs; and (c)
subsequently measured at amortized cost or fair value. The
requirements of PFRS 7 improve and simplify the approach for
classification and measurement of financial assets compared
with the requirements of PAS 39. PFRS 7 applies a consistent
approach to classifying financial assets and replaces the
numerous categories of financial assets in PAS 39, each of
which had its own classification criteria. They also result in one
impairment method, replacing the numerous impairment. The
Foundation has yet to assess the impact of the standard on its
financial statements.
Summary of Significant Accounting Principles
a. Cash and cash equivalents.
Cash includes cash on hand and in banks. Cash equivalents
are short term, highly liquid investments that are readily
convertible to known amounts of cash with original
maturities of three months or less and that are subject to an
insignificant risk of change in value.
b. Financial assets and financial liabilities.
Initial Recognition of Financial Assets and Liabilities.
The Foundation recognizes a financial asset or a financial
liability in the statement of financial position when the
Foundation becomes a party to the contractual provisions of
the instrument.
Financial assets and financial liabilities are recognized initially
at cost which is the fair value at inception. Transaction costs,
if any, are included in the initial measurement of all financial
assets and liabilities, except for financial instruments
measured at fair value through profit or loss (FVPL).
Financial instruments are classified as liabilities or equity
in accordance with the substance of the contractual
arrangement. Interest, dividends, gains and losses relating
to a financial instrument or a component that is a financial
liability, are reported as expense or income. Distributions
to holders of financial instruments classified as equity are
36
ABOITIZ FOUNDATION
charged directly to equity net of any related income tax
benefits. Financial instruments are offset when there is a
legally enforceable right to offset and intention to settle
either on a net basis or to realize the asset and settle the
liability simultaneously.
Investments in unquoted equity instruments that do not
have a quoted market price and whose fair value cannot
be reliably measured and derivatives that are linked to
and must be settled by delivery of such unquoted equity
instruments are measured at cost.
All regular way purchases and sales of financial assets are
recognized on the trade date, which is the date that the
Foundation commits to purchase the asset. Regular way
purchases or sales are purchases or sales of financial assets
that require delivery of assets within the period generally
established by regulation or convention in the marketplace.
Financial assets and financial liabilities are further classified
into the following categories: Financial asset or financial
liability at FVPL, loans and receivables, held-to-maturity
investments (HTM), available for sale (AFS) financial assets
and other financial liabilities. The Foundation determines
the classification at initial recognition and re-evaluates this
designation at every reporting date, where appropriate.
Categories of Financial Assets and Financial Liabilities.
Financial asset or financial liability at FVPL.
Financial assets at FVPL include financial assets classified
as held for trading and financial assets designated upon
initial recognition as at FVPL. Financial assets are classified
as held for trading if they are acquired for the purpose of
selling in the near term or upon initial recognition if it is
designated by management as FVPL. Derivatives, including
separated embedded derivatives, are also classified as held
for trading unless they are designated and considered as
effective hedging instruments. Gains or losses on financial
assets held for trading are recognized in profit or loss.
Where a contract contains one or more embedded
derivatives, the entire hybrid contract may be designated
as financial asset as at FVPL, except where the embedded
derivative does not significantly modify the cash flows or
it is clear that separation of the embedded derivative is
prohibited.
Financial assets may be designated at initial recognition at
FVPL if the following criteria are met: (i) the designation
eliminates or significantly reduces the inconsistent
treatment that would otherwise arise from measuring the
assets or recognizing gains or losses on them on a different
basis; (ii) the assets are part of a group of financial assets
which are managed and their performance evaluated on
a fair value basis, in accordance with a documented risk
managing strategy; or (iii) the financial asset contains an
embedded derivative that would need to be separately
recorded.
The Foundation has no financial assets and financial
liabilities at FVPL as of December 31, 2009 and 2008.
Held to maturity (HTM) investments.
HTM investments are quoted non-derivative financial assets
with fixed or determinable payments and fixed maturities
wherein the Foundation’s has the positive intention and
ability to hold to maturity. HTM assets are carried at
cost or amortized cost in the consolidated statement of
financial positions. Amortization is determined by using the
effective interest rate method. Assets under this category
are classified as current assets if maturity is within twelve
months of the statement of financial position date and
noncurrent assets if maturity is more than a year.
Loans and receivables.
Loans and receivables are non-derivative financial assets
with fixed or determinable payments that are not quoted
in an active market. They are not entered into with the
intention to sell immediately or in the near term and are not
classified as held for trading, designated as AFS investments
or financial assets at FVPL.
Loans and receivables are measured at amortized cost
using the effective interest rate method. Amortized cost is
calculated by taking into account any discount or premium
on acquisition and fees and costs that are an integral part of
the effective interest rate. The amortization is included in
interest income in the statement of comprehensive income.
Included in this category are the Foundation’s cash, accounts
receivables, loans receivables and other receivables.
Available for sale (AFS) financial assets.
AFS investments are non-derivative financial assets that
are either designated as AFS or not classified in any of the
other categories. AFS investments are measured at fair
value with gains or losses being recognized as a separate
component of stockholders’ equity, until the investments
are derecognized or until the investments are determined to
be impaired at which time, the accumulated gains or losses
previously reported in stockholders’ equity is included in
profit or loss. Dividends earned on AFS financial assets are
recognized as dividends-equity investments in profit or loss
when the right to receive payment is established. These
financial assets are classified as noncurrent assets unless
there is an intention to dispose such assets within twelve
months from the statement of financial position date.
Included in this category are the Foundation’s investments in
shares of stocks amounting to π41,224,645 and π23,204,422
as of December 31, 2009 and 2008, respectively.
Financial liabilities measured at amortized cost.
These are the financial liabilities which are not designated
at FVPL.
Financial liabilities not designated as FVPL are measured at
amortized cost using the effective interest rate method.
Amortized cost is calculated by taking into account any
discount or premium on the issue and fees that are an
integral part of the effective interest rate. The amortization
is included in interest expense in the statement of
comprehensive income.
Included in this category is the Foundation’s accounts
payable.
Derecognition of Financial Assets and Liabilities.
Financial assets.
A financial asset (or, where applicable a part of a financial
asset or part of a group of similar financial assets) is
derecognized where
ANNUAL REPORT 2009
• the rights to receive cash flows from the asset have
expired;
• the Foundation retains the right to receive cash flows
from the asset, but has assumed an obligation to pay
them in full without material delay to a third party
under a ‘pass-through’ arrangement; or
• the Foundation has transferred its rights to receive
cash flows from the asset and either (a) has
transferred substantially all the risks and rewards of
the asset, or (b) has neither transferred nor retained
substantially all the risks and rewards of the asset, but
has transferred control of the asset.
Where the Foundation has transferred its rights to receive
cash flows from an asset and has neither transferred nor
retained substantially all the risks and rewards of the asset
nor transferred control of the asset, the asset is recognized
to the extent of the Foundation’s continuing involvement in
the asset.
Financial liabilities.
A financial liability is derecognized when the obligation under
the liability is discharged or cancelled or expires.
Where an existing financial liability is replaced by another
from the same lender on substantially different terms, or the
terms of an existing liability are substantially modified, such
an exchange or modification is treated as a derecognition
of the original liability and the recognition of a new liability,
and the difference in the respective carrying amounts is
recognized in profit or loss.
Impairment of financial assets.
The Foundation assesses at each statement of financial
position date whether there is objective evidence that a
financial asset maybe impaired. A financial asset is deemed
to be impaired if there is objective evidence of impairment
as a result of one or more events that has occurred after the
initial recognition of the asset and that loss event has an
impact on the estimated future cash flows of the financial
asset that can be reliably estimated.
Financial assets at amortized cost.
For loans and receivables, the Foundation provides an
allowance for impairment and credit losses when there is
objective evidence that the Foundation will not be able to
collect all amounts due according to the original contractual
terms of the loan and when probable losses are present in
the components of the loan portfolio at the statement of
financial position date. Provision for specifically identified
loans is the difference between the carrying amount and the
recoverable amount, being the present value of expected
cash flows, including amounts recoverable from guarantees
and collateral, discounted at the original effective interest
rate of the loans. Provision for probable losses present in
components of the loan portfolio is estimated based on
historical patterns of losses in each component, the credit
ratings allocated to the borrowers and reflecting the current
economic climate in which the borrowers operate.
The allowance for impairment and credit losses is established
through a provision for impairment and credit losses in the
statement of comprehensive income. Loans are written off
against the allowance for impairment and credit losses when
management believes that the collection of the principal is
37
unlikely; subsequent recoveries are recognized in profit or
loss. If the allowance for loan losses subsequently decreases
due to an event occurring after a write down, the release of
the provision is recognized in profit or loss.
For HTM investments, the Foundation assesses individually
whether there is objective evidence of impairment. If there
is objective evidence that an impairment loss has been
incurred, the amount of loss is measured as the difference
between the assets carrying value and the present value of
estimated future cash flows. The carrying amount is reduced
through an allowance account and the amount of loss is
charged to provision for impairment and credit losses in
the statement of comprehensive income. Interest income
continues to be recognized based on the original effective
interest rate of the asset.
If, in a subsequent year, the amount of the estimated
impairment loss decreases because of an event occurring
after the impairment was recognized, any amounts previously
charged to provision for impairment and credit losses in profit
or loss and the allowance are reduced. The HTM investments
and the related allowance account are written off when there
is no realistic prospect of future recovery and the collateral
has been realized.
Financial assets carried at cost.
If there is objective evidence that an impairment loss has
been incurred on unquoted equity instrument that is not
carried fair value because its fair value cannot be reliably
measured, or on a derivative asset that is linked to and must
be settled by delivery of such unquoted equity instrument,
the amount of loss which is measured as the difference
between the asset’s carrying value and the present value of
the estimated future cash flows discounted at the current
market rate of return of a similar financial asset is charged to
provision for impairment and credit losses in the statement
of comprehensive income. Such impairment loss shall not be
reversed.
AFS financial assets.
If there is objective evidence that an AFS financial asset is
impaired, the Foundation removes from equity, the net
unrealized loss on AFS financial assets and transfers to profit
or loss, the difference between the acquisition cost (net
of any principal repayment and amortization) and current
fair value, less any impairment loss on that financial asset
previously recognized in profit or loss.
In the case of equity investments classified as AFS,
impairment losses are not reversed through profit or loss.
Increases in fair value are recognized directly in equity.
In the case of debt instruments, if subsequently the fair value
increases and the increase can be objectively related to an
event occurring after the impairment loss was recognized in
profit or loss, the impairment loss is reversed through profit
or loss.
c. Property and equipment.
Property and equipment are stated at cost, net of
accumulated depreciation and accumulated impairment
losses.
Cost of property and equipment comprises its net purchase
price and directly attributable costs of bringing the asset to
working condition for its intended use.
38
ABOITIZ FOUNDATION
Subsequent expenditures related to property and equipment
for maintenance or repairs are expensed. Improvements are
capitalized and depreciated over expected useful life.
Depreciation is computed using the straight-line method
over the estimated useful lives of the assets. Annual
depreciation rates are as follows:
Significant Accounting Estimates and Assumptions.
In the process of applying the accounting policies of the
Foundation, management has made the following judgments
apart from those involving estimates, which have the most
significant effect on the amounts recognized in the financial
statements:
Annual Rates
(%)
Computer equipment
Transportation equipment
Furniture and fixtures
Leasehold improvements
Held to maturity (HTM) investments.
For HTM investments, the Foundation evaluates its intention
and ability to hold such investments to maturity. If the
Foundation fails to keep these investments to maturity other
than in certain specific circumstances like selling an insignificant
amount close to maturity, it will be required to reclassify the
entire portfolio as AFS investments. As such, the investments
would be measured at fair value and not at amortized cost.
33.33%
33.33%
33.33%
33.33%
The useful lives of the assets and depreciation method
used are reviewed periodically for any significant change in
utility of the assets and in the expected pattern of economic
benefits to ensure that current and future depreciation
charges are adjusted accordingly.
Gain or loss on disposal or retirement of office furniture and
equipment are generally reflected in profit or loss.
At each statement of financial position date, office
furniture and equipment are assessed for any indication of
impairment in value based on internal and external sources.
If any indication exists, recoverable amount of the asset is
estimated and an impairment loss is recognized in profit or
loss.
d. Deferred credits.
Donations/grants restricted by the donor for specific purpose
are considered earned and reported as donation only when
expenditures are incurred by the Foundation in accordance
with the conditions set forth by the donor. Amounts not yet
expended are reported as deferred donation/grant.
e. Revenue recognition.
• Donations are recognized as received.
• Interest is recognized as income using the effective interest
method.
• Dividends are recognized as income when the right to
receive payment is established.
• Other income is recognized as earned.
f. Leases.
Operating lease payments are recognized as expense on a
straight line basis over the lease term.
g. Retirement benefits.
Retirement benefits are actuarially determined using
the projected unit credit cost method which reflects the
services rendered by employees up to valuation date and
incorporates assumptions concerning employees’ projected
salaries. Retirement costs include current service cost plus
amortization of past service cost, experience adjustments
and changes in actuarial assumptions. Actuarial gains or
losses are recognized in profit or loss if the cumulative
actuarial gains and losses exceeded the higher of 10% of the
defined benefit obligation or 10% of the fair value of the plan
assets at the end of the previous reporting period, over the
future average working lives of the employees.
HTM investments amounted to π36,000,000 as of December
31, 2009.
Allowance for doubtful accounts.
The Foundation maintains an allowance for doubtful accounts
on receivables at a level adequate to provide for potential
uncollectible accounts. Management determines the level of
this allowance through identification of specific accounts that
are to be provided with an allowance based on an evaluation
of collection and credit experience, prevailing and anticipated
economic condition, and present value of future cash
collections.
Receivables amounted to π122,191,395 and π69,357,045
(π552,000 non current) as of December 31, 2009 and 2008,
respectively.
Retirement benefits.
The determination of the obligation and cost of pension is
dependent on certain assumptions used in calculating such
amounts. Those assumptions are described in Note 15 —
Retirement benefits and include among others, discount rates
and future salary increases. While management believes that
its assumptions are reasonable and appropriate, significant
differences in the actual experience or significant changes
in the assumptions may materially affect the pension and
post employment obligations. Unrealized pension income
amounted to π104,126 in 2009. Retirement benefit expense
amounted to π281,286 in 2008. Pension asset presented as part
of other assets in the statement of financial position amounted
to π148,599 and P19,109 as of December 31, 2009 and 2008,
respectively.
Useful lives of property and equipment.
The Foundation estimates the useful lives of depreciable assets
based on the period over which the assets are expected to be
available for use. The estimated useful lives of these assets are
reviewed annually and are updated if expectations differ from
previous estimates due to physical wear and tear and technical
or commercial obsolescence. It is probable that the results
of future operations could be materially affected by changes
in the estimates due to changes in aforementioned factors.
Reduction in estimated useful lives of depreciable assets would
increase depreciation expense and decrease non current assets.
Carrying value of depreciable assets amounted to π1,150,717
and π414,384 as of December 31, 2009 and 2008, respectively.
ANNUAL REPORT 2009
Impairment of non-financial assets.
The Foundation assesses the impairment of non-financial
assets whenever events or changes in circumstances indicate
that the carrying amount of an asset may not be recoverable.
The impairment review requires an estimation of the present
value of the expected future cash flows from continued use of
the assets and selection of an appropriate discount rate that
can materially affect the financial statements.
Carrying value of non-financial assets as of December 31, 2009
and 2008 were as follows:
Office furniture and
equipment – net
Other assets
Trust funds
December
31, 2009
December
31, 2008
π1,150,717
568,590
44,821,020
π414,384
1,584,290
28,901,391
Fair value of financial instruments.
PFRS requires that certain assets and liabilities be carried at
fair value which requires the use of accounting judgment
and estimates. While significant components of fair value
measurement are determined using verifiable objective
evidence, the timing and amount of changes in fair value would
differ with the valuation methodology used. Any change in
fair value of these financial assets and liabilities would directly
affect net profit or loss or equity. As of December 31, 2009 and
2008, fair value of financial assets amounted to π201,567,578
and π93,861,223, respectively and fair value of financial
liabilities amounted to π5,014,005 and π56,053, respectively.
(see Note 19)
Accounts receivable includes funds held in custody for the
Foundation amounting to π112,138,491 and π48,343,952 as of
December 31, 2009 and 2008, respectively.
Loans receivable includes a five year loan to Aboitiz Equity
Ventures, Inc. amounting to π16,500,000 as of December
31, 2008 with interest rates ranging from 11% to 12%, which
matured and was collected on April 1, 2009.
Other loans receivable represent financial advances to
proponents in carrying out their social and community
development projects which are within the foundation’s
program and which have met the criteria set by the Foundation.
Financial advances are charged an administrative fee of 2% per
month to cover cost of administering these projects. Maturity
dates ranges from 1 to 5 years.
5.
HELD TO MATURITY INVESTMENTS
This account represents time deposits with City Savings Bank
(CSB) which earn annual interest at 8% and which mature on
various dates in 2014.
6.
AVAILABLE FOR SALE INVESTMENTS
This account consists of :
At fair value
Listed shares
3.
CASH This account consists of:
Cash on hand
Cash in bank
December 31
2009
December
31 2008
π5,000
2,146,538
π5,000
1,294,756
π2,151,538
π1,299,756
Cash in banks earns interest at current bank rates.
4.
RECEIVABLES
This account consists of:
Current
Accounts receivable
Loans receivable
Non Current
Loans receivable
December 31
2009
December 31
2008
π114,193,678
7,997,717
π48,414,567
20,390,478
122,191,395
68,805,045
--
552,000
π1
22,191,395
π69,357,045
39
December 31
2009
December 31
2008
π41,224,645
π23,204,422
Fair values of listed shares are based on quoted market prices.
Unrealized gain on AFS investments shown as a separate
component of equity is accounted for as follows:
Balance at beginning of
year
Fair value changes
recognized in
other
comprehensive
income
December 31
2009
December 31
2008
(π238,561)
π8,199,108
18,020,223
(8,437,669)
Balance at end of year
π17,781,662
(π238,561)
Dividends received from above investments amounted to
π1,141,242 and π2,091,764 in 2009 and 2008 respectively.
ABOITIZ FOUNDATION
40
7.
OFFICE FURNITURE AND EQUIPMENT
December 31, 2009
Computer
Equipment
Transportation
Equipment
Furniture and
Fixtures
Leasehold
Improvements
Total
Cost
Balance, December 31, 2008
Additions
Disposal/amortization
π1,002,546
––
––
π2,083,660
1,015,200
(80,500)
π90,697
85,569
––
π116,880
20,160
(91,498)
π3,293,783
1,120,929
(171,998)
1,002,546
3,018,360
176,266
45,542
4,242,714
Accumulated depreciation
Depreciation
Disposal
780,633
111,610
––
2,008,069
181,488
(80,500)
90,697
––
––
––
––
––
2,879,399
293,098
(80,500)
892,243
2,109,057
90,697
––
3,091,997
Book value
π110,303
π909,303
π85,569
π45,542
π1,150,717
Computer
Equipment
Transportation
Equipment
Furniture and
Fixtures
Leasehold
Improvements
Total
Cost
Additions
Disposal/amortization
π797,847
204,699
––
π2,188,260
––
(104,600)
π90,697
––
––
π137,954
57,483
(78,557)
π3,214,758
262,182
(183,157)
1,002,546
2,083,660
90,697
116,880
3,293,783
Accumulated depreciation
Depreciation
Disposal
657,982
122,651
––
1,950,330
99,579
(41,840)
90,697
––
––
––
––
––
2,699,009
222,230
(41,840)
780,633
2,008,069
90,697
––
2,879,399
Book value
π221,913
π75,591
––
π116,880
Depreciation and amortization charged to profit or loss amounted to π384,596 in 2009 and P300,787 in 2008.
π414,384
December 31, 2008
8.
Minimum corporate income tax (MCIT) is computed at two
percent of gross income, creditable against normal income
tax within the three immediately succeeding taxable years
as follows:
OTHER ASSETS
Minimum corporate
income tax
Pension asset (Note 15)
Office supplies
Accrued interest receivable
December 31
2009
December 31
2008
π180,280
148,599
––
239,711
π179,382
19,109
2,325
1,383,474
π568,590
π1,584,290
Year
Sustained
2006
2007
2008
2009
Amount
Expired in
2009
MCIT
unused
12.31.2009
Expiry
π68,666
49,604
61,111
69,565
π68,666
––
––
––
––
π49,604
61,111
69,565
2009
2010
2011
2012
π248,946
π68,666
π180,280
ANNUAL REPORT 2009
9.
TRUST FUNDS
14.
These are funds entrusted/conditionally donated to the
Foundation to insure continuous support to certain charitable
programs of the foundation. In accordance with the terms and
conditions of the trust funds, the funds are disbursed only for
the intended purpose for which each trust fund was created.
Trust fund principal are credited to deferred credits upon
receipt and are recognized as income by the Foundation upon
occurrence of a specified event.
10.
41
SALARIES AND HONORARIA
Salaries and wages
Employee benefits
Honoraria
SSS, PHIC and
contributions
Pag-ibig
2009
2008
π3,320,923
362,331
165,000
162,155
π2,752,522
277,445
265,000
131,022
π4,010,409
π3,425,989
ACCOUNTS PAYABLE
Accounts payable
Other payables
December 31
2009
December 31
2008
π4,941,505
72,500
––
π56,053
π5,014,005
π56,053
Accounts payable consists mainly of supplier’s credit.
15.
RETIREMENT BENEFITS
The Foundation has a funded, noncontributory defined benefit
plan administered by the Fund’s Trustees covering all regular
and full time employees.
Components of retirement cost obligation recognized in the
statement of financial position and retirement benefit expense
recognized in profit or loss are as follows:
11.
DEFERRED CREDITS
The following is summary of transactions for deferred grants/
donations during the year.
December 31
2009
December 31
2008
Deferred grant, beginning
of year
Transfer of restricted funds
to unrestricted
Donations received
Grants earnings
Donations made
Grant expenses
Change in fair values of AFS
investments
π28,901,391
––
18,632,000
2,096,299
(8,238,701)
(1,969)
3,432,000
π43,972,309
(10,622,202)
16,032,000
1,387,792
(19,769,152)
(6,614)
(2,092,742)
Deferred grant, end of year
π44,821,020
π28,901,391
2009
2008
Pension asset recognized in the
statement of financial position
Changes in present value
of obligation
Balance beginning
Current service cost
Interest cost
Actuarial loss (gain)
π80,546
22,800
30,253
2,508,201
π1,154,108
259,781
86,904
(1,420,247)
Balance end
2,641,800
80,546
1,046,207
115,083
25,364
(60,725)
—
777,211
85,493
220,289
(36,786)
—
1,125,929
1,046,207
Excess of plan assets over
retirement obligation
Unrecognized actuarial
(gain) loss
(1,515,871
1,664,470)
965,661
(946,552)
Pension asset recognized
in the statement of
financial position
π148,599
π19,109
Changes in plan assets
Balance beginning
Expected return of
plan assets
Contributions
received from
employer
Actuarial loss
Benefits paid
Balance end
12.
DONATIONS RECEIVED
This account represents donations received from private
companies, individuals and LGU counterparts amounting to
π166,385,849 in 2009 and π66,930,098 in 2008.
13.
DONATIONS MADE
This account represents released funds for various projects
amounting to P76,345,447 in 2009 and P64,174,249 in 2008.
ABOITIZ FOUNDATION
42
Retirement benefits expense
recognized in the revenues and
expenses
Current service cost
Interest cost
Expected return of plan
assets
Recognized actuarial loss
(gain)
Retirement expense (pension
income) presented in
revenues and expenses
Actual return of plan assets for
the year
Assumptions used to determine
retirement costs
Discount rate
Expected return of plan
assets
Rate of salary increase
2009
2008
π22,800
30,253
(115,083)
(42,096)
π259,781
86,904
(85,493)
20,094
members or sell its assets to reduce debt. No changes were
made in the objective, policy or processes in 2009 and 2008.
The Foundation manages capital using the gearing ratio
which is net debt divided by equity plus net debt. It is the
Foundation’s policy to keep the gearing ratio at 30% or below.
The Foundation determines net debt as total liabilities less cash.
Equity comprises all components of equity (fund balance and
unrealized gain/loss on AFS investments).
The gearing ratios of the Foundation at statement of financial
position date were as follows:
(P104,126)
P281,286
π54,358
π48,707
9.54%
10%
8%
37.56%
11%
9%
December 31
2009
December 31
2008
Net debt
Total liabilities
Cash
π49,835,025
(2,151,538)
π28,957,444
(1,299,756)
Net debt (a)
Equity
47,683,487
198,272,880
27,657,688
95,803,844
π245,956,367
π123,461,532
19%
22%
Equity and net debt (b)
Gearing ratio (a/b)
Major categories of plan assets as a percentage of the fair
value of the total plan assets are as follows:
Short term investments
Time deposits
2009
2008
94%
6%
94%
6%
16.
COMPENSATION OF KEY MANAGEMENT PERSONNEL
The aggregate compensation and benefits paid to key
management personnel are as follows:
Short
term
employee
benefits
Post employment benefits
2009
2008
π1.3 million
π1 million
7 thousand
106 thousand
Members of the Board of Trustees donate their services to the
Foundation. Donated services were valued at π165,000 in 2009
and π265,000 in 2008.
17.
CAPITAL MANAGEMENT
The primary objective of the Foundation in managing capital is
to ensure the Foundation’s ability to continue as a going concern
so that the Foundation can continue to support its projects and
programs and thus achieve the purpose for which it was created.
The Foundation manages its capital structure and makes
adjustments to it in the light of changes in economic condition.
To maintain or adjusts capital the Foundation may assess its
18.
FINANCIAL RISKS MANAGEMENT POLICIES AND OBJECTIVES
The financial instruments of the Foundation comprise principally
of cash, accounts receivable, held to maturity investments,
available for sale investments and accounts payable.
The main risks arising from these financial instruments are credit
risk and liquidity risk. The Board of Trustees has reviewed and
set up policies to manage these risks. It continuously upgrades
these policies and procedures to ensure that the management
of risk exposures is both progressive and reflective of the
Foundation’s financial outlook.
Credit risk.
Credit risk is the risk that the Foundation will incur a loss
because its counterparties failed to discharge their contractual
obligation.
Credit risks arising from debtors are mitigated by subjecting
debtors to credit verification and setting of credit limits.
Furthermore, the Foundation monitors receivables continuously.
Outstanding receivables of the Foundation amounting to
π122,191,395 and π69,357,045 as of December 31, 2009 and
2008, respectively consist of receivables that are neither past
due nor impaired and are of standard credit quality.
Credit risk from other financial assets, which comprise mainly of
cash, is mitigated by maintaining depository accounts and cash
investments with financial institutions of high credit rating.
Furthermore, the Board of Trustees sets limits on deposits that
could be placed with a single institution. Cash amounted to
π2,151,538 and π1,299,756 as of December 31, 2009 and 2008,
respectively.
ANNUAL REPORT 2009
43
The credit quality per class of the financial assets are as follows:
December 31, 2009
Neither past due nor impaired
High Grade
Standard
Sub-standard
Past Due or
Impaired
Total
––
––
––
π114,193,678
6,425,518
36,000,000
––
––
––
––
π1,572,199
––
π114,193,678
7,997,717
36,000,000
––
π156,619,196
––
π1,572,199
π158,191,395
––
––
π48,414,567
19,744,639
––
––
––
π1,197,839
π48,414,567
20,942,478
––
π68,159,206
––
π1,197,839
π69,357,045
Accounts receivable
Loans receivable
Accounts receivable
Loans receivable
Equity price risk.
Equity price risk is the risk that the fair value of traded equity
instruments decreases as the result of the changes in the level
of equity indices and the value of individual shares.
As of December 31, 2009 and 2008, the Foundation’s exposure
to equity price risk is minimal.
Liquidity risk.
Liquidity risk is the risk that an entity will encounter difficulty in
meeting obligations associated with financial liabilities.
To manage this risk, the Foundation regularly monitors its
projected and actual cash flows information. Any excess cash is
invested in short term placements.
The following table presents the Foundation’s financial liabilities
by contractual maturities and settlement dates as of December
31, 2009 and 2008:
As of December 31, 2009
Contractual Undiscounted Payments
Financial liabilities
Total
Carrying
Value
Total
On
Demand
Less than 1 year
1 to 5 years
>5 years
Accounts payable
π5,014,005
π5,014,005
––
π5,014,005
––
––
Total
Carrying
Value
Total
On
Demand
Less than 1 year
1 to 5 years
>5 years
Accounts payable
π56,053
π56,053
––
π56,053
––
––
The following table presents the Foundation’s financial assets by contractual maturities and collection dates as of December 31, 2009 and
2008:
Cash
Accounts receivable
Held to maturity
investments
Available for sale
investments
Total
Carrying
Value
Total
On
Demand
Less than 1 year
1 to 5 years
>5 years
π2,151,538
122,191,395
π2,151,538
122,191,395
––
––
π2,151,538
122,191,395
––
––
––
––
36,000,000
36,000,000
––
––
π36,000,000
––
41,224,645
41,224,645
––
41,224,645
––
––
π201,567,578
π201,567,578
––
π165,567,578
π36,000,000
––
ABOITIZ FOUNDATION
44
Cash
Accounts receivable
Available for sale
investments
Total
Carrying
Value
Total
On
Demand
Less than 1
year
1 to 5 years
>5 years
π1,299,756
69,357,045
π1,299,756
69,357,045
––
––
π1,299,756
68,805,045
––
π552,000
––
––
23,204,422
23,204,422
––
23,204,422
––
––
––
π93,309,223
π552,000
––
π93,861,223
π93,861,223
19.
FINANCIAL INSTRUMENTS
Set out below is a comparison by category of carrying amounts
and fair values of all of the Foundation’s financial instruments
that are carried in the financial statements at other than fair
values.
December
31, 2009
Financial assets
Loans and receivable
Cash
Accounts receivable
Available for sale investments
Other financial liabilities
Accounts payable
December 31, 2008
Carrying
Value
Fair
Value
Carrying
Value
Fair
Value
π2,151,538
122,191,395
36,000,000
41,224,645
π2,151,538
122,191,395
36,000,000
41,224,645
π1,299,756
69,357,045
––
23,204,422
π1,299,756
69,357,045
––
23,204,422
π201,567,578
π201,567,578
π93,861,223
π93,861,223
π5,014,005
π5,014,005
π56,053
π56,053
Fair value is defined as the amount at which the financial
instrument could be exchanged in a current transaction between
knowledgeable willing parties in an arms’ length transaction,
other than in a forced liquidation or sale. Fair values are obtained
from quoted market prices, discounted cash flow models and
option pricing models, as appropriate.
The carrying amounts of the Foundation’s financial assets and
financial liabilities approximate fair value due to the relatively
short term maturity of these financial assets.
Fair Value Hierarchy.
As of December 31, 2009 and 2008, the Foundation’s AFS
investments are the only financial instruments held that are
measured at fair value.
December 31, 2009
AFS investments
December 31, 2008
AFS investments
Total
Level 1
Level 2
Level 3
π41,224,645
π41,224,645
––
––
Total
Level 1
Level 2
Level 3
π23,204,422
π23,204,422
––
––
The Foundation uses the following hierarchy for determining
the fair value of financial instruments by valuation technique:
Level 1: quoted (unadjusted) prices in active markets for
identical assets or liabilities;
Level 2: other techniques for which all inputs which have
significant effect on the recorded fair value are observable,
either directly or indirectly;
Level 3: technique which uses inputs which have a significant
effect on the recorded fair value that are not based on
observable market data.

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