JUAN PAOLO A.

ANG
Certified Public Accountant
Unit 12B, No. 88, CITIC TOWER,
Banawe St., Cor. Don Manuel Agregado St.,
Quezon City
Mobile # +63 917 8251327
Email Address: [email protected]

INDEPENDENT AUDITOR’S REPORT

(Name of Proprietor)
Proprietor
(Registered Address)

Report on the Financial Statements

Opinion

I have audited the financial statements of (Name of Proprietor), which comprise the statements of
financial position as at December 31, 2018, and the statements of comprehensive income, changes in
equity and cash flows for the years then ended and notes to the financial statements, including the
summary of significant accounting policies and other explanatory information (if any).

In my opinion, the financial statements present fairly, in all material respects, the financial position of
(Name of Proprietor) at December 31, 2018, and its financial performance and its cash flows for the
years then ended in accordance with Philippine Financial Reporting Standards for Small and Medium-
sized Entities (PFRS for SMEs).

Basis for Opinion

I conducted my audit in accordance with Philippine Standards on Auditing (PSAs). My responsibilities

under those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial
Statements section of my report. I am independent of the Company in accordance with the Code of Ethics
for Professional Accountants in the Philippines (the Code of Ethics) together with the ethical
requirements that are relevant to my audit of the financial statements in the Philippines, and I have
fulfilled my other ethical responsibilities in accordance with these requirements and the Code of Ethics. I
believe that the audit evidence I have obtained is sufficient and appropriate to provide a basis for my
opinion.

Other Matters

The financial statements of (Name of Proprietor) for the year ended December 31, 2016 were audited by
another auditor who issued a qualified opinion on (Date of Auditor’s Report – Prior Year).

Responsibilities of Management and those Charged with Governance for the Financial Statements

Management is responsible for the preparation and fair presentation of the financial statements in
accordance with PFRS for SMEs and for such internal control as management determines is necessary to
enable the preparation of financial statements that are free from material misstatement, whether due to
fraud or error.
In preparing the financial statements, management is responsible for assessing the company’s ability to
continue as a going concern, disclosing, as applicable, matters related to going concern and using the
going concern basis of accounting unless management either intends to liquidate the company or to cease
operations, or has no realistic alternative but to do so.

Those charged with governance are responsible for overseeing the company’s financial reporting process.

Auditor’s Responsibilities for the Audit of the Financial Statements

My responsibility is to express an opinion on these financial statements based on my audit. I conducted

my audit in accordance with Philippine Standards on Auditing. Those standards require that I comply
with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether
the financial statements are free from material misstatements.

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.

As part of an audit in accordance with PSA, I exercise professional judgment and maintain professional
skepticism throughout the audit. I also:

 Identify and assess the risks of material misstatements of the financial statements, whether due to
fraud or error, design and perform audit procedures responsive to those risks, and obtain audit
evidence that is sufficient and appropriate to provide basis for my opinion. The risk of not
detecting a material misstatement resulting from fraud is higher than for one resulting from error,
as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override
of internal control.

 Obtain an understanding of internal control relevant to the audit 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 company’s internal control.

 Evaluate the appropriateness of accounting policies used and the reasonableness of accounting
estimates and related disclosures made by management.

 Conclude on the appropriateness of management’s use of the going concern basis of accounting
and, based on the audit evidence obtained, whether a material uncertainty exists related to events
or conditions that may cast significant doubt on the company’s ability to continue as a going
concern. If I conclude that a material uncertainty exists, I am required to draw attention in my
auditor’s report to the related disclosures in the financial statements or, if such disclosures are
inadequate, to modify my opinion. My conclusions are based on the audit evidence obtained up to
the date of my auditor’s report. However, future events or conditions may cause the company to
cease to continue as a going concern.
  Evaluate the overall presentation, structure and content of the financial statements, including the
disclosures, and whether the financial statements represent the underlying transactions and events
in a manner that achieves fair presentation.

 Obtain sufficient appropriate audit evidence regarding the financial information of the entities or
business activities within the Company to express an opinion on the financial statements. I am
responsible for the direction, supervision and performance of the audit. I remain solely
responsible for my audit opinion.

I communicate with those charged with governance regarding, among other matters, the planned scope
and timing of the audit and significant audit findings, including any significant deficiencies in internal
control that I identify during my audit.

I also provide those charged with governance with a statement that I have complied with relevant ethical
requirements regarding independence, and to communicate with them all relationships and other matters
that may reasonably be thought to bear on my independence, and where applicable, related safeguards.

From the matters communicated with those charged with governance, I determine those matters that were
of most significance in the audit of the financial statements of the current period and are therefore the key
audit matters. I describe these matters in my auditor’s report unless law or regulations precludes public
disclosure about the matter or when, in extremely rare circumstances, I determine that a matter should not
be communicated in my report because the adverse consequences of doing so would reasonably be
expected to outweigh the public interest benefits of such communications.

Report on Other Legal and Regulatory Requirements-Supplementary information required under RR

15-2010 and RR 19-2011

My audit was conducted for the purpose of forming an opinion on the basic financial statements as a
whole. The supplementary information on taxes, duties and license fees in Note 22 to the financial
statements is presented for the purpose of filing with the Bureau of Internal Revenue is not a required part
of the basic financial statements. Such information is the responsibility of the management. The
information has been subjected to the auditing procedures applied in my audit of the basic financial
statements. In my opinion, the information is fairly stated in all material respects in relation to the basic
financial statements taken as a whole.

Juan Paolo A. Ang

CPA Certificate No. 151388
TIN 291-892-821-000
BOA Accreditation No.: 6764
Valid until July 5, 2020
BIR Accreditation No. 07-001411-001-2017
Valid until October 30, 2020
PTR No. 7376379
January 7, 2019
Quezon City

(Date of Auditor’s Report)