GOLDEN BANTTAM LENDING CORPORATION

OUR LADY OF LOURDES, JARO, ILOILO CITY

A Feasibility Study
Presented to

The Faculty of the

College of Business and Accountancy
Western Institute of Technology
La Paz, Iloilo City

In Partial Fulfillment of the Requirements in the subject

Accounting 423
(Management Consultancy)

Presented by:

Ambrocio, Coleen Jay

Arsenia, Samantha
Ballogdajan, Florie Anne
Maranda, Aljefry
Nieva, Junuario
Tacadao, Karen
Tagle, Nerica Faith

2020
 LETTER OF TRANSMITTAL

April 24, 2020

Rochelle Grace A. Sobrevega, CPA

Professor
Accountancy Department
Western Institute of Technology
Luna St., La Paz, Iloilo City

Ma’am:

As a requirement of the course Accounting 423 (Management Consultancy), this

feasibility study entitled GOLDEN BANTTAM LENDING CORPORATION is hereby
submitted in accordance with your instruction, supervision, and guidance.

An effort has been made in this study. Research and interviews were conducted to the
proper authorities in order for us to accomplish this endeavor.

We hope that this proposed study that we prepared merits your approval.

Respectfully yours,

Ambrocio, Coleen Jay

Arsenia, Samantha
Ballogdajan, Florie Anne
Maranda, Aljefry
Nieva, Junuario
Tacadao, Karen
Tagle, Nerica
 TABLE OF CONTENTS

Introduction 1

I. EXECUTIVE SUMMARY 2

1.1 Name of Proponents 2

1.2 Business Name 2

1.3 Business Location 2

1.4 Brief Description of the Business 2

1.5 Highlights of the Major Assumptions and Summary of

Findings and Conclusion regarding the following 3

1.5.1 Market Feasibility 3

1.5.2 Technical Feasibility 3

1.5.3 Management Aspect 3

1.5.4 Financial Analysis 4

1.5.5 Social or Economic Desirability 4

1.5.6 Legal and Taxation 4

II. PROJECT BACKGROUND AND HISTORY 5

2.1 Name and Address of the Promoters 5

2.2 Project Orientation 5

2.3 Market Orientation 5

2.4 History 6

2.5 Business Background 7

2.6 Vision 8

2.7 Mission 8

2.8 Business Objectives 8

III. ECONOMIC ASPECT 9

3.1 Demand Analysis 9

 3.2 Estimation of Present Demand 9

3.3 Supply Analysis 10

3.4 SWOT Analysis 11

IV. TECHNICAL ASPECT 12

4.1 Description of Operation and Process 12

4.2 Business Location and Floor Plan 13

4.2.1 Location 13

4.2.2 Floor Plan 14

4.3 Project Equipment, Furniture & Fixture and Supplies 15

4.4 Product Description 18

V. MANAGEMENT ASPECT 19

5.1 Type of Organization 19

5.2 Organizational Chart 19

5.3 Personnel Component 19

VI. MANPOWER 21

6.1 Human Resource Development 21

6.2 Human Resource Planning 22

6.3 Hiring Policy 23

VII. FINANCIAL ASPECT 25

7.1 Projected Cost and Source of Funds 25

7.2 Financial Assumptions 25

7.3 Financial Statements 28

7.4 Notes and Schedules 32

7.5 Financial Analysis 49

VIII. SOCIAL ASPECT 55

IX. OPERATIONS OF THE BUSINESS 56

X. EVALUATION 57

10.1 Summary and Conclusion 57

10.2 Recommendations 58
 INTRODUCTION

A lending company is the one who provide loans and services to those in need of
financing. This kind of business can be profitable if the funds are managed properly and
certain risks are controlled.

Aside from the purpose of maximization of profit, a credit company can be

beneficial to other businesses by giving them an opportunity to obtain additional capital
to expand and grow their business. It can also be of assistance for those private-sector
employees and pensioners that are sometimes experiencing financial crisis due to social
and economic reasons, such as high maintenance lifestyle and inflation.

This feasibility study aims to learn how does a lending company work and will
investigate if such undertaking is viable in the existing conditions of the market. If such
study is deemed feasible, through financial analysis, we shall determine the degree of
sustainability and profitability of the proposed study.

6
 Chapter 1
EXECUTIVE SUMMARY

1.1 Name of Proponents

Ambrocio, Coleen Jay
Arsenia, Samantha
Ballogdajan, Florie Anne
Maranda, Aljefry
Nieva, Junuario
Tacadao, Karen
Tagle, Nerica Faith

1.2 Business Name

The proposed project will henceforth be named GOLDEN BANTTAM LENDING
CORPORATION. Such name was derived from the first letter of every last name of the
proponents. This study focuses on loans for micro enterprises, private-sector employees
and pensioners.

1.3 Business Location

The proposed location of the project will be in a fully-furnished vacant office in
The Galleria at Jalandoni St, Brgy. Our Lady of Lourdes, Jaro, Iloilo City.

1.4 Brief Description of the Business

Due impending financial crisis it was discovered that many micro-businesses,
private-sector employees, and pensioners are experiencing difficulties in seeking
financial aid because of the fact that banks nowadays require tons of requirements in
availing a loan while other lending institutions have unreasonably high interest rates.

Our proposed project ‘’GOLDEN BANTTAM LENDING CORPORATION’’, is a

small lending company that caters to the financial needs of the micro-enterprises,

7
private-sector employees and pensioners which provides good services, fast approval,
and reasonable interest rate that only need minimal requirements.

1.5 Highlights of the Major Assumption and Summary of Findings and Conclusion
regarding the following:

1.5.1 Market Feasibility

Iloilo City is one of the best cities to do business here in the Philippines. Many big
companies are rising and more job opportunities are offered. Because of these, the
standard of living of the people improved and became more sophisticated. This is also
accompanied by the increase of demand of businesses that wishes to expand.

1.5.2 Technical Feasibility

This phase discusses about the operation and flow of the business activities. It
includes the description of the products offered by the business. This phase also
consists of the equipment, furniture & fixtures and supplies that is readily available for
usage and consumption. The equipment, furniture & fixtures and supplies are listed
herein with their costs and corresponding depreciation.

1.5.3 Management Aspect

The management aspect suggests a clear and precise identification of duties and
responsibilities, flow of authority and level requirements. This contains the organizational
chart and the qualification of the people involved in the formation of the business
organization structure. To attain this, management must able to plan all services, for the
company to become dynamic and competitive business over and done with human
resource, financial capabilities and new technologies.

8
1.5.4. Financial Analysis
Financial Ratios were used to help gauge the Liquidity, Solvency, and Profitability
of this project. In addition, Capital Budgeting techniques were also performed in able to
determine if this undertaking will make a good investment.

1.5.5 Social or Economic Desirability

The proposed study aims to be beneficial to the society and to the economy by
providing the opportunity to attain accessible financial assistance to micro-businesses,
private-sector employees and pensioners for them to sustain their monetary needs
which will help them grow, whether as a business or as a person.

1.5.6 Legal and Taxation

This proposed study is governed by laws such as Republic Act 11232 otherwise
known as “Revised Corporation Code of the Philippines.” and Batas Pambansa Blg. 68
otherwise known as “The Corporation Code of the Philippines”.

Under these laws, a corporation is defined as “…an artificial being created by

operation of law, having the right of succession and the powers, attributes and properties
expressly authorized by law or incident to its existence.”

In addition, this proposed study is also under the assumption that it complies with
Republic Act 9474 otherwise known as the “Lending Company Regulation Act of 2007”,
and Republic Act 3765 otherwise known as the “Truth in Lending Act”.

1.5.7 Income Tax

This proposed study follows the updated corporate taxation laws and schemes of
the Philippines specifically the Tax Reform for Acceleration and Inclusion Law
(T.R.A.I.N. Law) and other existing taxation laws and schemes.

9
 Chapter II
PROJECT BACKGROUND AND HISTORY

2.1 Name and Address of the Promoters

Name of Proponents Address

Ambrocio, Coleen Jay Pontevedra, Capiz
Arsenia, Samantha Maasin, Iloilo
Ballogdajan, Florie Anne Compania, Molo, Iloilo
Maranda, Aljefry Lapaz, Iloilo City
Nieva, Junuario Jaro, Iloilo City
Tacadao, Karen Jaro, Iloilo City
Tagle, Nerica Faith San Jose, Antique

2.2 Project Orientation

GOLDEN BANTTAM LENDING CORPORATION is a business orientation that
undertakes loans.

2.3 Market Orientation

GOLDEN BANTTAM LENDING CORPORATION yearns to be the leading
lending company in Iloilo City that caters to micro businesses, private-sector employees,
and pensioners.

An initial overview of the available loans offered:

For Business loans:
TERMS OF AMOUNT INTEREST OF MODE OF TERM
LOANS OF LOANS LOANS/ MONTH COLLECTION
First Loan 10,000 16% fixed Daily 3 months
Second Loan 20,000 16% fixed Daily 3 months
Third Loan 30,000 16% fixed Daily 3 months
Maximum Loan 50,000 16% fixed Daily 3 months

10
 Computations
Daily Payment:
Principal - ()

Interest already collected in advance.

Computation for late payments:

For salary loans:

TERMS OF AMOUNT OF INTEREST OF MODE OF TERM
LOANS LOANS LOANS PAYMENT
Minimum loan 20,000 10% fixed Every 15 days 3 months
Maximum loan 40,000 10% fixed Every 15 days 3 months

For pension loans:

TERMS OF AMOUNT OF INTEREST OF MODE OF TERM
LOANS LOANS LOANS PAYMENT
SSS Loan 10,000 10% fixed Every month 3 months
GSIS Loan 20,000 10% fixed Every month 3 months

2.4 History
Ancient Roman law recognized a range of corporate entities under the names
universitas, corpus or collegium. These included the state itself, municipalities, and such
private associations as sponsors of a religious cult, burial clubs, political groups, and
guilds of craftsmen or traders. Such bodies commonly had the right to own property and
make contracts, to receive gifts and legacies, to sue and be sued, and, in general, to
perform legal acts through representatives. Private associations were granted
designated privileges and liberties by the emperor.

Entities which carried on business and were the subjects of legal rights were
found in ancient Rome, and the Maurya Empire in ancient India. In medieval Europe,
churches became incorporated, as did local governments, such as the Pope and the City
of London Corporation.

11
 The point was that the incorporation would survive longer than the lives of any
particular member, existing in perpetuity. The alleged oldest commercial corporation in
the world, the Stora Kopparberg mining community in Falun, Sweden, obtained a charter
from King Magnus Eriksson in 1347.

In medieval times, traders would do business through common law constructs,

such as partnerships. Whenever people acted together with a view to profit, the law
deemed that a partnership arose. Early guilds and livery companies were also often
involved in the regulation of competition between traders.

2.5 Business Background

GOLDEN BANTTAM LENDING CORPORATION was founded by a group of

young professionals that came from Western Institute of Technology. They were
groupmates in Management Consultancy during their last semester in college. The
project assigned to them was a Lending Company. At first, it was difficult for them to
establish that kind of proposal. But with their perseverance and determination to
graduate, they gave their full effort and time to make the project possible. Tiring days
and sleepless nights were rendered to their work. Study time for their other subjects
have been sacrificed because the Pre-Final Exams and deadlines were near
approaching at the same time. Despite of that, they still have managed to go through it.
Friendships have been developed in the process and dreams were born. All of a sudden,
they have decided that someday the project that they have been working on, will come
to a reality. Not just for the possible profit, but for the benefit of the people, and that it will
be a great help for the society especially to those who are suffering in financial
difficulties.

One day, they have met and have finally decided to start the business that they
have longed dreamt. With the help of their former classmates in college, they have finally
established the lending company that will surely be a big help for those in need in the
future. Thus, the birth of GOLDEN BANTTAM Lending Corporation that has become

12
beneficial in lending financial assistance to the businesses, private-sector employees,
and pensioners, that offers fast approval with a reasonable interest rate.
2.6 Vision
To be one of the top-tier lending company in Iloilo in terms of financial
dependability & competency.

2.7 Mission
GOLDEN BANTTAM LENDING CORPORATION aims to provide immediate
financial support to those who is in need, with reasonable interest rate.

2.8 Business Objectives

 Make loans easily accessible to potential market.

 Ensure that the process of Revenue Forecasting and Credit Investigation is
effective and efficient to yield accurate results in its respective fields.
 To be known as the lending institution that offers the most reasonable rate in the
industry.
 Conduct business to stakeholders and clients with honesty and integrity.

13
 Chapter III
ECONOMIC ASPECT

3.1 Demand Analysis

Table 3.1
Estimated
number of
Number of Population Size
Target Market populatio
n
2019 2020 Increase % 2021
Micro businesses 252 290 19.19% 345
Private-sector
200 220 10% 242
employees
Pensioners 115 150 30% 195

Table 3.1 shows the increased trend of registered businesses in Iloilo City from
the year 2019 to 2020. Based on the number of registrants, new and old, it is estimated
that by the year of 2021, assuming the steady performance of the city’s economy, by
2021, there will be a lot of potential clients. The estimated the population of the private-
sector employees and pensioners are based on the number of schools and private-
sector employees in Jaro and its near barangays.

3.2 Estimation of Present Demand

Table 3.2
Target Estimated Populatio Unwillin Percentag Estimated
Market population n Size g to e Over the Percentage
by 2020 Loan Population that are
Size willing to

14
 loan.
Small
Business 313 290 70 24.13% 75.87%
Entrepreneurs
Private-sector
312 220 70 31.82% 68.18%
employees
Pensioners 307 150 30 20% 80%

Table 3.2 shows that based on the interviews and questions conducted by the
proponents, the estimated percentage of population for micro businesses, private-sector
employees, and pensioners. The table shows 313 for micro businesses, 312 for private-
sector employees and 307 for pensioners. Based on this there are 68% willing to loan for
micro businesses, 64% for private-sector employees and 79% for pensioners. If we
multiply the total projected population with the projected interest, we can say that in the
lending business is productive in in terms if income at the same time risky.

3.3 Supply Analysis

Since the nature of the operation is lending money, the supply for this kind of
business is, of course, from the fund that the corporation will lend to the borrowers.
Good collection strategy must be implemented to ensure faster return of investment and
to ultimately make repayments faster to enable to loan out more money to more
borrowers.

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3.4 SWOT Analysis

Strengths Weaknesses

 Reasonable interest rate  Unsecured loans

 Fast approval with back up  Susceptibility to past dues
 Accessible  No insurance for loans
 Strong customer – based/customer
friendly
 Strong, transparent and informed
leadership

Opportunities Threats

 Ability to use reasonable interest rates  Abrupt change of policy and

as means to penetrate the market framework
 Accessibility helps the company to be  Entrance of potential competitors
visible to potential clients  Economic inflation and fluctuation
 Expansion of market through  Prone to stealing
customer’s recommendation  Technological changes in financial and
business sector
 Potential conflict of interest

16
 Chapter IV
TECHNICAL ASPECT

4.1 Description of Operation and Process

In able to the project to be implemented, the project must first comply to the
requirements and the basic documents required by Republic Act 11232 or the Revised
Corporation Code of the Philippines, Security and Exchange Commission (SEC), and
Bureau of Internal Revenue (BIR).

The GOLDEN BANTTAM LENDING CORPORATION will grant loans for the
micro enterprises, private-sector employees, and pensioners, with reasonable interest
rate of 16% per quarter for business loans, 10% for salary loans, and 10% for pension
loans, All interest of the loans are deducted in advance with no other hidden charges or
processing fees. The debtor must comply all the requirements of the company to avail
the loan. Loans will be paid depending on the dealings between the client and the office
clerk and under the final approval of the manager. The additional interest will
automatically accumulate for pending payments of matured date.

The target market is composed of private-sector employees, pensioners, and

micro businesses. For the private-sector employees, a Memorandum of Agreement
(MOA) is required to be signed by the creditor (lending company), debtor (client), and
guarantor (employer of client) whereas the demandable balance of the loan will be
automatically deducted from their monthly salary to ensure immediate mandatory
payment of their loans. For pensioners, ATM must be surrendered to the company which
will returned to them if the lent money is paid. For micro businesses, a business permit
must be submitted together with other proof of business ownership to assure that they
are financially capable to pay their lent amount. It will mature when the payment is
already paid and it will be automatically expired if the debtors failed to pay in the day of
their payment or in the due date.

17
 In compliance of the requirements of R.A 9520, the credit company will provide; a
promissory note stating the amount of loan, the interest of loan, other fees and other
terms and conditions that will be signed by both the representatives of the lending
corporation and the borrower same as with his/her co-maker.

Proceeds on Salary Loan and Pension Loan are automatically credited to the
bank account of the lending company through a bank to bank transaction as agreed on
the MOA.

4.2 Business Location and Floor Plan

4.2.1 Location

18
 The location of the project would be the vacant office space of The Galleria at
Jalondoni Street, Brgy. Our Lady of Lourdes, Jaro, Iloilo City.

4.2.2 Floor Plan

19
 This picture above shows the floor plan of the proposed project. This is an empty
unit subject to renovation and improvement, to be fill in of our equipment, furniture and
fixtures.

4.3 Project Equipment, Furniture & Fixture and Supplies

In order to operate, the business will need these necesarry equipment. These are
the proposed equipment that must be acquired before the project will be implemented.

20
 Three (3) sets of computer
Two (2) units of printer
One (1) telephone/ fax machine
Four (4) cctv camera
One (1) vault
Two (2) motorcycle

Equipment Photo Numbe Cost per Unit Total

r of (Amount in ( Amount in
units Php) Php)
Computer 3 25,000 75,000

Printer 2 14,000 28,000

Telephone 1 3,800 3,800

CCTV Camera 4 2,500 10,000

Vault 1 6,000 6,000

Motorcycle 2 48,000 96,000

Biometric 1 4,050 4,050

fingerprint
scanner
TOTAL 222,850

These equipment will be canvas by the owner in the qualified supplier. Setting a
parameter to get lowest price with a good quality standards.

These wiil be use by the employees in the office for the effective and efficient
business operation. The proponents suggested to have a three (3) computers one (1)
will be use by the manager and the other two (2) will be use by the cashier and loan
clerk. The two (2) printers will be use by the manager and the other one (1) will be use

21
by the cashier for preparing documents and printing the reports/receipts. The company
must have at least one (1) telephone for the queries of the prospective clients and for
other business related concerns. The four (4) units cctv camera will be install inside and
outside the office for safety purposes of the business operation.One (1) unit Vault will be
use for safety of money and important documents. The two (2) motorcycle will be use by
the collectors for collecting money and other business transactions. One (1) biometric
fingerprint scanner will be use by the all employees for their time in, time out. These
equipment have an estimated useful life of 5 years and the motorcycles have an
estimated useful life of 7 years.

The proponents haved also proposed to have a following furniture and fixtures.
Four (4) Sets of office table
One (1) Conference table
Five (15) Office chair
One (2) Gang chair
Two (3) Cabinet

Furniture Photo Numbe Cost per Unit

and fixutres r of (Amount in Php) Total
Units
Office Table 4 2,171 8,684

Conferrence 1 15,500 15,500

Table
Office chair 15 1398 20,970

Gang Chair 2 6,500 13,000

Air 1 15,500 15,500
conditioner
Cabinet 3 6,950 20,850

TOTAL 94,504

These furniture and fixtures will be install and be use in the office. The Foue (4)
tables and chairs will be use by the manager, loans supervisor, office clerk, and the

22
cashier. The one (1) cabinet and one (1) vault will be install in the manager cubicle and
the other two (2) cabinets will use by the cashier and office clerk. The two (2) gang chair
will be put near at the door and be sitted by the waiting customers. Air condition will
install inside the office, and the coferrence table will be use if there will be a meeting.
The furniture and fixtures have estimated useful life 5 years.

In proccessing various transaction the office also need the following office
supplies. Good canvasing are applied in purchasing this products to find the cheapest
supplier.

For the first year operation:

Office Supplies Number of Cost per Units Total (amount

units (amount in in Php)
Php)
Bond Paper 10 155 1,550
(ream)
Official Receipt 30 215 6,450
(ream)
Ballpoint pen 4 125 500
(box)
Folder and 20 90 1,800
Fastener (box)
Ink 4 500 2,000
Calculator 4 500 2,000
Total 14,300

These supplies will be used in any business operations and transactions.

4.4 Product Description

Business Loans

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  The product will be offer for micro – businesses with 16% fixed interest per
quarter and will be collected everyday. The amount they will receive is at
discounted value meaning the 16% fixed rate is already deducted to the
released amount.

Salary Loans
 The product will cater private-sector employees, the loan will have a 10% fixed
rate per quarter and will be collected every 15 days. The amount they will receive
is at discounted value meaning the 10% fixed rate is already deducted.

Pensioner Loans
 This product is for the pensioners of any government agency. The loan will have
a have 10% fixed rate per quarter and will be collected every month. Likewise
they will receive the amount at discounted value meaning the 10% fixed is
already deducted.

Chapter V
MANAGEMENT ASPECT

24
5.1 Type of Organization
The proposed business will be established as corporation as per the
Requirement of RA 9474 act Governing the Establishment, Operation and Regulation of
Lending Companies.

5.2 Organizational Chart

CHAIRMAN OF
THE BOARD

BOARD OF
DIRECTORS

MANAGER/OPERATIONS
HEAD

CASHIER OFFICE CLERK COLLECTORS

5.3 Personnel Component

The business will employ five (5) employees in the office, the
manager/operations head, cashier, office clerk and collectors. Their duties and
responsibilities are stated below;

Chairman of the Board

Holds the most power and authority on the board of directors and provide
leadership to the firm’s officers and executives. Ensures that the firm’s duties to
shareholders are being fulfilled by acting as a link between the board and upper
management. And ensures that the board is effective in its task of setting and
implementing the company’s direction and strategy.

Board of Directors

25
 Every corporation must have board of director, they are elected group of
individuals that represent shareholders. They are the governing body that typically meets
at regular intervals to set policies for corporate management and oversight. They do
decisions as a fiduciary on behalf of shareholders, and they are the responsible for
helping the corporation set broad goals, supporting executive duties, and ensuring the
company has adequate, well – managed resources at its disposal.

Manager/Operations Head
In charge of overall in lending operation. He/she approves the loan application
and vouchers as long as the client has good standing in engagement. Analyze
borrower’s financial and credit status to determine whether the loans will be granted or
denied.

Cashier
The one who handles the cash register or on guard to record cash receipts and
disbursement of the company. Ensures that prices and quantities are correct, and
collected payments. And responsible in releasing and accepting payments of loan.

Office clerk
They prepare cheques, vouchers, promissory note to be issued to borrowers.
They are the frontlines and responsible for clerical matters related to loan processing,
including keeping records of the financial affairs of a business. He/she records the
economic transactions of the business in preparation of the financial statements.

Collectors
They are responsible in collecting the said manner of collection in the different
mode of the loans. They play a large role in the organization because they are carrying
the sole income of the corporation.

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 Chapter VI
MANPOWER

6.1 Human Resource Development

GOLDEN BANTTAM LENDING CORPORATION is committed to develop and

provide reliable services that support and align with corporation goals and code. Key
areas of focus during the next five years will involve the following;

a.) Leadership Behavior – Leadership Training Program

This course provides new engaging tools designed to help us and our
employee become a more effective leader. Using the ‘four frames’ model of leadership,
this course explains how to choose our leadership behavior strategically and respond to
context in an agile manner. It provides structured opportunities for us to reflect on
challenges, share ideas, and strengthen our abilities. Further, it will reveal our
tendencies for ‘framing’ leadership situations and help us identify our blind spots. This
training puts the learner at the center, identify the leadership and decision-making
preferences and tendencies.

b.) Performance Management – Management Skills

Although there is a lot of innovation going on in performance
management-land, in here we focus on the feedback part. We all know, the one with the
manager that hardly knows what the employee in front them does on a day-to-day basis.
Fortunately, there are a lot of companies that understand the importance of performance
management and feedback done differently. This course will provide us with concrete
strategies to become more effective in our current organization through the application of
intentional communication approaches, strengthened interpersonal skills, and effective
management techniques. This highly participatory training will help us assess our current
management abilities and create a plan to apply the new skills learned in this course.

27
 c.) Training for Employee Engagements – Employee Continuous Development
This course is designed to build the confidence and course design and
facilitation skills of staff to deliver relevant and effective management training to
employees. It is designed to help our employee and organization improve course design
and facilitation skills to deliver more impactful training and capacity building activities.
This will create learning objectives and a session plan for a training session, develop
effective resource materials to support the learning process, facilitate multiple interactive
and participatory training techniques, demystify technical concepts and information,
deliver a participatory-style training session that builds skills and knowledge, recognize
different adult learning styles and how they impact course design demonstrate to our
colleagues that technical training is more effective when a practical, participatory
approach is used.

6.2 Human Resource Planning

Key Areas Programs and Date of Participants Budget

Activities Implementatio
n
Leaders/Owners Chairman of
regular Meeting the Board
Annual General 2021 Board of TBA
Leadership Assembly Directors
Behavior – Leadership
Leadership Training Camp
Training Program

Management
Talks and 2021 Employees
Performance Seminars TBA
Management – Monthly Checking
Management of Management
Skills Status

28
 Annual Retreat
and Recollection
Training for Team Building Employees
Employee Activities 2021 Chairman of
Engagements – Training and the Board
Employee Seminars for may TBA
Continuous Employees participate
Development Incentives and Board of
Benefits Directors
may also
interact

6.3 Hiring Policy

Manager/Operations Head
 Graduate of any business and accounting course
 At least 25 years of age
 With 2 – 3 years of meaningful experience
 Willing to engage in long term employment with the business
 Must be a computer literate
 Possesses leadership skills and motivate its colleague
 Good communication skill
 Critical thinker and ability to direct people

Cashier
 Graduate of any business course
 At least 25 years of age
 With 1 – 2 years of experience in related work
 Possesses honesty and integrity
 Must be computer literate

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  Patient in all aspect
 Trustworthy in terms of financial responsibility

For Office Clerk

 Graduate of any business and accounting course
 Proficiency in MS OFFICE WORD
 Must have good communication skill
 Must speak fluently in English and pleasing personality
 Honest and business oriented
 At least 21 years of age

For Collectors
 Graduate of any business and accounting course
 Proficiency in MS Office Word
 Computer literate
 Must have a good communication skill
 Honest and trustworthy – specifically possesses integrity
 Good moral character
 At least 25 years of age

CHAPTER VII
FINANCIAL ASPECT

30
7.1 Projected Cost and Source of Funds
The source of funds is solely coming from the contributed capital of the
Incorporators.

Name Contributed capital

Ambrocio, Coleen Jay 300,000
Arsenia, Samantha 300,000
Ballogdajan, Florie Anne 300,000
Maranda, Aljefry 300,000
Nieva, Junuario 300,000
Tacadao, Karen 300,000
Tagle, Nerica 300,000
TOTAL:

7.2 Financial Assumptions

For the purpose of preparing financial statements it is assumed that the project
will start its first year of operation on January 1, 2021.

Initial Capital
 The business project has 2,100,000 starting capital from the incorporators.

Cash & Cash Equivalents

 Petty cash fund of 20,000 is established and replenished every last day of the month.

Supplies
 Purchase of office supplies increase by 1% per year. 75% of office supplies was
consumed per month and increases by 4% per year. 25% remains on hand.

Rent
 The accounting policy of the company treats the lease contract as an operating
lease.
Revenue
 Projected total number of clients for the year is allocated to four quarters.

31
 Projected revenue increases 10% every year. Interest is deducted in advance from
the principal.
 The amount that the company will receive is at a discounted value meaning the fixed
interest rates of 16% for micro-businesses and 10% for salary loans and 10% for
pensioner loans is already deducted.
 The principal amount and the unearned interest income are recorded per quarter.
 80% of the total interest is deducted in advance and 20% will be earned in the
following year.
 Expected collection is 80% per quarter and the remaining 20% will be collected in the
next quarter.

Expenses
 Salaries increases 3% every year.
 An amount of P500 per month is allotted for advertising and promotional purposes.
 Utilities expense increases by 3% per year. 90% are paid. 10% payable for the
following month.
 Fuel consumption increases by 3% per year. All paid in cash.
 Purchase of Office Supplies increases by 1% every year and consumption of it also
increases by 1% every year.
 The SSS, PAG-IBIG and PhilHealth will be paid following month (every 10th day of
the following month).
 As mandated by law, 1/10 of 1% of the paid-up capital shall be paid for the issuance
of a Certificate of Authority to Operate as a Lending Company.
 Equipment, Furniture & Fixtures and Leasehold Improvements is depreciated using
the straight-line method.
 The company will assume 1% for bad debts that will based on the percentage of
loans receivable.
 Income tax is payable 60 days after each quarter.

Dividends

32
 Date of declaration is on every 10th of December, while the date of record is every
15th of December, and the date of payment is every 20th day of December.
 For five consecutive years, the Board of Directors declares dividend at P7 per share.

7.3 Financial Statements

33
 GOLDEN BANTTAM LENDING CORPORATION
Projected Statement of Financial Position
December 31, 2021 - December 31, 2025

Note 2021 2022 2023 2024 2025

ASSETS
Current Assets
Cash & Cash 3,268,30
1
Equivalents 748,132 1,114,455 1,644,500 2,354,814 9
1,752,24 2,565,45
2
Loan Receivable, net 0 1,927,464 2,120,210 2,332,231 5
Office supplies 3 397 798 1,204 1,613 2,026
TOTAL CURRENT 2,500,76 5,835,79
ASSETS 9 3,042,718 3,765,914 4,688,658 0

Non-Current Assets
Property, Plant & 4
Equipment, net 349,369 281,384 213,399 145,414 77,429
TOTAL NON-
CURRENT ASSETS 349,369 281,384 213,399 145,414 77,429

2,850,13 5,913,21
TOTAL ASSETS 8 3,324,101 3,979,313 4,834,072 9

LIABILITIES
Current Liabilities
1,260,19
5
Trade & Other Payables 569,663 707,190 866,411 1,049,965 8
1,260,19
TOTAL LIABILITIES 569,663 707,190 866,411 1,049,965 8

SHAREHOLDER'S EQUITY
2,100,00 2,100,00
6
Share Capital 0 2,100,000 2,100,000 2,100,000 0
2,553,02
7
Retained Earnings 180,475 516,911 1,012,902 1,684,107 1
TOTAL
SHAREHOLDER'S 2,280,47 4,653,02
EQUITY 5 2,616,911 3,112,902 3,784,107 1

TOTAL LIABILITIES
AND
SHAREHOLDER'S 2,850,13 5,913,21
EQUITY 8 3,324,101 3,979,313 4,834,072 9
GOLDEN BANTTAM LENDING CORPORATION
Projected Income Statement
For the Years Ended December 31, 2021 – December 31, 2025

34
 Not
Income e
2021 2022 2023 2024 2025

2,406,00 2,911,26 3,202,38

8
Interest Income 0 2,646,600 0 6 3,522,625

2,406,00 2,911,26 3,202,38

TOTAL INCOME 0 2,646,600 0 6 3,522,625

Expenses

General & Admin. 9 1,442,17 1,496,70 1,537,52

Expenses 9 1,459,977 2 2 1,575,319

Selling Expenses 10 6,000 6,000 6,000 6,000 6,000

1,448,17 1,502,70 1,543,52

TOTAL EXPENSES 9 1,465,977 2 2 1,581,319

1,408,55 1,658,86
INCOME BEFORE TAX 957,821 1,180,623 8 4 1,941,306

Less: Income Tax (287,346) (354,187) (422,567) (497,659) (582,392)

INCOME AFTER 1,161,20

TAX 670,475 826,436 985,991 5 1,358,914

GOLDEN BANTTAM LENDING CORPORATION

Projected Statement of Cash Flows
For the Years Ended December 31, 2021 – December 31, 2025

35
Operating Activities 2021 2022 2023 2024 2025
1,161,20 1,358,91
Income After Tax 670,475 826,436 985,991 5 4
Add: Depreciation
Expense 67,985 67,985 67,985 67,985 67,985
Bad Debts Expense 22,560 2,256 2,482 2,730 3,003
(Increase)/Decrease
Office Supplies Unused (397) (401) (405) (409) (413)
(Increase)/Decrease
Loan Receivable (1,774,800) (177,480) (195,228) (214,751) (236,226)
Increase/(Decrease)
Trade & Other Payables 569,663 137,527 159,221 183,554 210,232
Net Cash provided or
(used) from Operating 1,020,04 1,200,31 1,403,49
Activities (444,514) 856,323 5 4 5

Investing Activities
Acquisition of PPE (417,354) - - - -
Net Cash provided or
(used) from Investing
Activities (417,354) - - - -

Financing Activities
Issuance of share
capital 2,100,000 - - - -
Dividends Paid (490,000) (490,000) (490,000) (490,000) (490,000)
Net Cash provided or
(used) from Financing
Activities 1,610,000 (490,000) (490,000) (490,000) (490,000)

Net Increase/(Decrease) 748,132 366,323 530,045 710,314 913,495

Add: Cash & Cash 1,114,45 1,644,50 2,354,81
Equivalents, beg - 748,132 5 0 4
Cash & Cash 1,644,50 2,354,81 3,268,30
Equivalents, end 748,132 1,114,455 0 4 9

GOLDEN BANTTAM LENDING CORPORATION

Projected Statement of Retained Earnings
For the Years Ended December 31, 2021 - December 31, 2025

Not
e 2021 2022 2023 2024 2025

36
Retained Earnings, beg 6 - 180,47 516,911 1,012,902 1,684,10
5 7

670,47 826,43 1,358,91

Add: Net Income 7 5 6 985,991 1,161,205 4

490,00 490,00
Less: Dividend Paid 0 0 490,000 490,000 490,000
180,47 516,91 2,553,02
Retained Earnings, end 5 1 1,012,902 1,684,107 1

7.4 Notes and Schedules

2021 2022 2023 2024 2025

Not 1 Cash & Cash Equivalents

37
e
Petty Cash Fund 20,000 20,000 20,000 20,000 20,000
Cash on hand 728,132 1,094,455 1,624,500 2,334,814 3,248,309
Total Cash & Cash
Equivalents 748,132 1,114,455 1,644,500 2,354,814 3,268,309

Not
2
e Loan Receivable, net
Loan Receivable 1,774,800 1,952,280 2,147,508 2,362,259 2,598,485
Less: Allowance for Bad
Debts 22,560 24,816 27,298 30,027 33,030
Loan Receivable, net 1,752,240 1,927,464 2,120,210 2,332,231 2,565,455

Not
3
e Office Supplies
Office Supplies, beg - 397 798 1,204 1,613
Purchases 14,300 14,443 14,587 14,733 14,881
Total Office Supplies 14,300 14,840 15,386 15,937 16,494
Office Supplies consumed (13,903) (14,042) (14,182) (14,324) (14,467)
Office Supplies, end 397 798 1,204 1,613 2,026

Not Property, Plant and

4
e Equipment, net
Office Equipment 126,850 126,850 126,850 126,850 126,850
Furnitures & Fixtures 94,504 94,504 94,504 94,504 94,504
Leasehold Improvements 100,000 100,000 100,000 100,000 100,000
Motorcycle 96,000 96,000 96,000 96,000 96,000
Total 417,354 417,354 417,354 417,354 417,354
Accumulated Depreciation -
Office Equipment 25,370 50,740 76,110 101,480 126,850
Accumulated Depreciation -
Furniture & Fixtures 18,901 37,802 56,702 75,603 94,504
Accumulated Depreciation -
Leasehold Improvements 10,000 20,000 30,000 40,000 50,000
Accumulated Depreciation -
Motorcycle 13,714 27,429 41,143 54,857 68,571
Total Accumulated
Depreciation 67,985 135,970 203,955 271,940 339,925
Total Property, Plant and
Equipment, net 349,369 281,384 213,399 145,414 77,429

Not
5
e Trade & Other Payables
SSS, PhilHealth & PAG-
IBIG payable 12,682 13,451 14,004 14,821 15,308
Utilities Payable 3,043 3,135 3,229 3,326 3,425
Income Tax Payable 71,837 160,383 266,025 390,440 536,038
Withholding Tax Payable-
Expanded 902 902 902 902 902
Unearned Interest Income 481,200 529,320 582,252 640,477 704,525
Total Trade & Other 569,663 707,190 866,411 1,049,965 1,260,198

38
 Payables

Not
6 2,100,000 2,100,000 2,100,000 2,100,000 2,100,000
e Total Share Capital

Not
7
e Retained Earnings
Retained Earnings, beg - 180,475 516,911 1,012,902 1,684,107
Add: Net Income 670,475 826,436 985,991 1,161,205 1,358,914
Less: Dividends Paid 490,000 490,000 490,000 490,000 490,000
Retained Earnings, end 180,475 516,911 1,012,902 1,684,107 2,553,021

Not
8 2,406,000 2,646,600 2,911,260 3,202,386 3,522,625
e Interest Income

Not General & Administrative

9
e Expenses
Salaries Expense 760,320 783,130 806,623 830,822 855,747
13th Month Pay 63,360 65,261 67,219 69,235 71,312
SSS, PhilHealth & PAG-
IBIG Contribution 152,184 161,410 168,043 177,854 183,697
Office Supplies Expense 13,903 14,042 14,182 14,324 14,467
Depreciation Expense 67,985 67,985 67,985 67,985 67,985
Utilities Expense 30,433 31,346 32,287 33,255 34,253
Taxes & Licences 7,150 7,025 7,025 7,025 7,025
Rent Expense 216,361 216,361 216,361 216,361 216,361
Fuel Expense 107,923 111,160 114,495 117,930 121,468
Bad Debts Expense 22,560 2,256 2,482 2,730 3,003
Total General &
Administrative Expenses 1,442,179 1,459,977 1,496,702 1,537,522 1,575,319

Not 1
e 0 Selling Expenses
Advertising Expense 6,000 6,000 6,000 6,000 6,000
Total Selling Expenses 6,000 6,000 6,000 6,000 6,000

Not 1
e 1 Income Tax Payable
Income Tax Payable, beg - 71,837 160,383 266,025 390,440
Income Tax 287,346 354,187 422,567 497,659 582,392
Income Tax Paid (215,510) (265,640) (316,926) (373,244) (436,794)
Income Tax Payable, end 71,837 160,383 266,025 390,440 536,038

Schedule 1 – Revenue

MICRO-BUSINESS LOAN

39
Package 1

1st Qtr 2nd Qtr 3rd Qtr 4th Qtr Year-end

Number of Clients 75 65 50 30 220

Loanable Amount 10,000 10,000 10,000 10,000 40,000

Total 750,000 650,000 500,000 300,000 2,200,000

Interest Rate 16% 16% 16% 16%

Total Interest Income 120,000 104,000 80,000 48,000 352,000

Package 2

1st Qtr 2nd Qtr 3rd Qtr 4th Qtr Year-end

Number of Clients 70 55 45

Loanable Amount 20,000 20,000 20,000 60,000

Total 1,400,000 1,100,000 900,000 3,400,000

Interest Rate 16% 16% 16%

Total Interest Income 224,000 176,000 144,000 544,000

Package 3

1st Qtr 2nd Qtr 3rd Qtr 4th Qtr Year-end

Number of Clients 60 50

Loanable Amount 30,000 30,000 60,000

Total 1,800,000 1,500,000 3,300,000

Interest Rate 16% 16%

Total Interest Income 288,000 240,000 528,000

Package 4

40
 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr Year-end

Number of Clients 55

Loanable Amount 40,000 40,000

Total 2,200,000 2,200,000

Interest Rate 16%

Total Interest Income 352,000 352,000

TOTAL INTEREST INCOME 120,000 328,000 544,000 784,000 1,776,000

(MICRO-BUSINESS LOAN)

SALARY LOAN 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr Year-end

Average Client per Quarter 50 30 30 40 150

Average Loanable Amount 30,000 30,000 30,000 30,000 120,000

Interest Rate 10% 10% 10% 10%

Total Interest Income 150,000 90,000 90,000 120,000 450,000

PENSION LOAN 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr Year-end

Average Client per Quarter 35 30 20 35 120

Average Loanable Amount 15,000 15,000 15,000 15,000 60,000

Interest Rate 10% 10% 10% 10%

Total Interest Income 52,500 45,000 30,000 52,500 180,000

GRAND TOTAL INTEREST

INCOME 322,500 463,000 664,000 956,500 2,406,000

41
Schedule 2 – Manner of Collection

2021 2022 2023 2024 2025

Principal 11,280,00 12,408,00 13,648,80 15,013,68 16,515,04
0 0 0 0 8
Balance 2,256,000 2,481,600 2,729,760 3,002,736
forwarded
Manner of
Collection:
80% 9,024,000 9,926,400 10,919,04 12,010,94 13,212,03
Collectible 0 4 8

20% collected 2,256,000

on the
following year
(2022)

20% collected 2,481,600

on the
following year
(2023)

20% collected 2,729,760

on the
following year
(2024)

20% collected 3,002,736

on the
following year
(2025)

TOTAL 9,024,000 12,182,40 13,400,64 14,740,70 16,214,77

COLLECTIO 0 0 4 4
N
Balance 2,256,000 2,481,600 2,729,760 3,002,736 3,303,010

Unearned Interest Income

Total Interest Collected in advance - 4th Qtr 956,500
Total Interest Earned 2/3 of the last
Qtr 637,667
Total Unearned Interest Income 318,833

Note: The unearned Interest Income will be earned in the following year.

80% of the total interest deducted advance for 2022 will be earned and 20% will be earned
in the following year.

42
 2021 2022 2023 2024 2025
Unearned Interest,
beg - 481,200 529,320 582,252 640,477

Total Interest collected 2,406,00 2,646,60

in advance 0 0 2,911,260 3,202,386 3,522,625
1,924,80 2,117,28
Total Interest earned 0 0 2,329,008 2,561,909 2,818,100

Total Interest earned

from prior year - 481,200 529,320 582,252 640,477
1,924,80 2,598,48
Total Interest Earned 0 0 2,858,328 3,144,161 3,458,577
Unearned Interest,
end 481,200 529,320 582,252 640,477 704,525

2021 2022 2023 2024 2025

Loan Receivable 1,774,800 1,952,280 2,147,508 2,362,259 2,598,485

Schedule 3 – Salaries & Deductions

Salaries

no. of Annual Annual Annual Annual

no. of Monthly
months Salary Salary Annual Salary Salary
employees Salary
in a year (2021) (2022) Salary (2023) (2024) (2025)

Manager 1 15,000 12 180,000 185,400 190,962 196,691 202,592

Cashier 1 12,090 12 145,080 149,432 153,915 158,533 163,289

Office Clerk 1 12,090 12 145,080 149,432 153,915 158,533 163,289

Collectors 2 12,090 12 290,160 298,865 307,831 317,066 326,578

TOTAL 5 51,270 760,320 783,130 806,623 830,822 855,747

2021 2022 2023 2024 2025

13th Month Pay 63,360 65,261 67,21 69,23 71,31

43
 9 5 2

SSS Contribution Schedule (2021)

Monthly Annual Contr.

no. of
no. of Monthly Contr. Incl. Incl.
months in Annual Salary
employees Salary Employer's Employer's
a year
Share Share

Manager 1 15,000 12 180,000 1,890 22,680

Cashier 1 12,090 12 145,080 1,510 18,120

Office Clerk 1 12,090 12 145,080 1,510 18,120

Collectors 2 12,090 12 290,160 3,020 36,240

TOTAL 5 760,320 7,930 95,160

SSS Contribution Schedule (2022)

Monthly Annual Contr.

no. of
no. of Monthly Contr. Incl. Incl.
months in Annual Salary
employees Salary Employer's Employer's
a year
Share Share

Manager 1 15,450 12 185,400 1,950 23,400

Cashier 1 12,453 12 149,432 1,570 18,840

Office Clerk 1 12,453 12 149,432 1,570 18,840

Collectors 2 12,453 12 298,865 3,140 37,680

TOTAL 5 783,130 8,230 98,760

44
SSS Contribution Schedule (2023)

Monthly Annual Contr.

no. of
no. of Monthly Contr. Incl. Incl.
months in Annual Salary
employees Salary Employer's Employer's
a year
Share Share

Manager 1 15,914 12 190,962 2,010 24,120

Cashier 1 12,826 12 153,915 1,570 18,840

Office Clerk 1 12,826 12 153,915 1,570 18,840

Collectors 2 12,826 12 307,831 3,140 37,680

TOTAL 5 806,623 8,290 99,480

SSS Contribution Schedule (2024)

Monthly Annual Contr.

no. of
no. of Monthly Contr. Incl. Incl.
months in Annual Salary
employees Salary Employer's Employer's
a year
Share Share

Manager 1 16,391 12 196,691 2,070 24,840

Cashier 1 13,211 12 158,533 1,630 19,560

Office Clerk 1 13,211 12 158,533 1,630 19,560

Collectors 2 13,211 12 317,066 3,260 39,120

TOTAL 5 830,822 8,590 103,080

45
SSS Contribution Schedule (2025)

Monthly Annual Contr.

no. of
no. of Monthly Contr. Incl. Incl.
months in Annual Salary
employees Salary Employer's Employer's
a year
Share Share

Manager 1 16,883 12 202,592 2,130 25,560

Cashier 1 13,607 12 163,289 1,690 20,280

Office Clerk 1 13,607 12 163,289 1,690 20,280

Collectors 2 13,607 12 326,578 3,380 40,560

TOTAL 5 855,747 8,890 106,680

PhilHealth Contribution Schedule (2021)

Monthly Annual Contr.

no. of
no. of Monthly Premium Contr. Incl. Incl.
months in
employees Salary Rate Employer's Employer's
a year
Share Share

Manager 1 15,000 12 3.50% 525 6,300

Cashier 1 12,090 12 3.50% 423 5,078

Office Clerk 1 12,090 12 3.50% 423 5,078

Collectors 2 12,090 12 3.50% 846 10,156

TOTAL 5 2,218 26,611

46
PhilHealth Contribution Schedule (2022)

Monthly Annual Contr.

no. of
no. of Monthly Premium Contr. Incl. Incl.
months in
employees Salary Rate Employer's Employer's
a year
Share Share

Manager 1 15,450 12 4.00% 618 7,416

Cashier 1 12,453 12 4.00% 498 5,977

Office Clerk 1 12,453 12 4.00% 498 5,977

Collectors 2 12,453 12 4.00% 996 11,955

TOTAL 5 2,610 31,325

PhilHealth Contribution Schedule (2023)

Monthly Annual Contr.

no. of
no. of Monthly Premium Contr. Incl. Incl.
months in
employees Salary Rate Employer's Employer's
a year
Share Share

Manager 1 15,914 12 4.50% 716 8,593

Cashier 1 12,826 12 4.50% 577 6,926

Office Clerk 1 12,826 12 4.50% 577 6,926

Collectors 2 12,826 12 4.50% 1,154 13,852

TOTAL 5 3,025 36,298

47
PhilHealth Contribution Schedule (2024)

Monthly Annual Contr.

no. of
no. of Monthly Premium Contr. Incl. Incl.
months in
employees Salary Rate Employer's Employer's
a year
Share Share

Manager 1 16,391 12 5.00% 820 9,835

Cashier 1 13,211 12 5.00% 661 7,927

Office Clerk 1 13,211 12 5.00% 661 7,927

Collectors 2 13,211 12 5.00% 1,321 15,853

TOTAL 5 3,462 41,541

PhilHealth Contribution Schedule (2025)

Monthly Annual Contr.

no. of
no. of Monthly Premium Contr. Incl. Incl.
months in
employees Salary Rate Employer's Employer's
a year
Share Share

Manager 1 16,883 12 5.00% 844 10,130

Cashier 1 13,607 12 5.00% 680 8,164

Office Clerk 1 13,607 12 5.00% 680 8,164

Collectors 2 13,607 12 5.00% 1,361 16,329

TOTAL 5 3,566 42,787

48
PAG-IBIG Contribution Schedule

Monthly Annual
no. of
no. of Monthly Contr. Incl. Contr. Incl.
months
employees Salary Employer's Employer's
in a year
Share Share

Manager 1 15,000 12 600 7,200

Cashier 1 12,090 12 484 5,803

Office Clerk 1 12,090 12 484 5,803

Collectors 2 12,090 12 967 11,606

TOTAL 5 2,534 30,413

December Contributions
(payable next year)
2021 2022 2023 2024 2025
SSS 7,930 8,230 8,290 8,590 8,890
PhilHealth 2,218 2,610 3,025 3,462 3,566
PAG-IBIG 2,534 2,610 2,689 2,769 2,852
TOTAL 12,682 13,451 14,004 14,821 15,308

Summary of
Contributions
2021 2022 2023 2024 2025
SSS 95,160 98,760 99,480 103,080 106,680
PhilHealth 26,611 31,325 36,298 41,541 42,787
PAG-IBIG 30,413 31,325 32,265 33,233 34,230
TOTAL 152,184 161,410 168,043 177,854 183,697

Schedule 4 – Depreciation

49
 No. of Cost per Useful Annual Monthly
OFFICE EQUIPMENT Cost
Units Unit Life Depreciation Depreciation

Computer 3 25,000 75,000 5 15,000 1,250

Printer 2 14,000 28,000 5 5,600 467

Telephone 1 3,800 3,800 5 760 63

CCTV Camera 4 2,500 10,000 5 2,000 167

Vault 1 6,000 6,000 5 1,200 100

Biometric finger scanner 1 4,050 4,050 5 810 68

TOTAL 126,850 25,370 2,114

FURNITURE AND No. of Cost per Useful Annual Monthly

Cost
FIXTURES Units Unit Life Depreciation Depreciation

Office Table 4 2,171 8,684 5 1,737 145

Conferrence Table 1 15,500 15,500 5 3,100 258

Gang Chair 2 6,500 13,000 5 2,600 217

Office Chair 15 1,398 20,970 5 4,194 350

Air Conditioner 1 15,500 15,500 5 3,100 258

Cabinet 3 6,950 20,850 5 4,170 348

Total 94,504 18,901 1,575

No. of Cost per Useful Annual Monthly

AUTOMOBILE
Units Unit Cost Life Depreciation Depreciation

Motorcycle 2 48,000 96,000 7 13,714 1,143

Total 96,000 13,714 1,143

50
 Useful Annual Monthly
Cost Life Depreciation Depreciation

LEASEHOLD
IMPROVEMENTS 100,000 10 10,000 833

100,000 10,000 833

Annual Monthly

TOTAL
DEPRECIATION 67,985 5,665

Schedule 5 – Expenses

Utilities Expense

Januar Februar
Electricity y y March April May June
Estimated kilowatt per day 10 10 10 10 10 10
Rate per kilowatts 9.9131 9.9131 9.9131 9.9131 9.9131 9.9131
No. of Days 24 24 27 24 26 26
Total 2,379 2,379 2,677 2,379 2,577 2,577

Septembe Octobe Novembe Decembe

July August r r r r Total
10 10 10 10 10 10 10
9.9131 9.9131 9.9131 9.9131 9.9131 9.9131 9.9131
27 26 26 26 26 25 307
2,677 2,577 2,577 2,577 2,577 2,478 30,433

Fuel Expense

Fuel Consumption January February March April May June

Estimated fuel per day 3.5 3.5 3.5 3.5 3.5 3.5
no. of motorcycle 2 2 2 2 2 2
Rate per liter 50.22 50.22 50.22 50.22 50.22 50.22
No. of Days 24 24 27 24 26 26
Total 8,437 8,437 9,492 8,437 9,140 9,140
July August Septembe Octobe Novembe Decembe Total

51
 r r r r
3.5 3.5 3.5 3.5 3.5 3.5 3.5
2 2 2 2 2 2 2
50.22 50.22 50.22 50.22 50.22 50.22 50.22
27 26 26 26 26 25 307
9,492 9,140 9,140 9,140 9,140 8,789 107,923

Rent Expense
Januar Februar
y y March April May June
Monthly rental - 18,030 18,030 18,030 18,030 18,030 18,030

Septembe Octobe Novembe Decembe

July August r r r r Total
18,030 18,030 18,030 18,030 18,030 18,030 216,361

Januar Februar
Office Supplies y y March April May June
Office Supplies, beg - 298 372 391 396 397
Purchases 1,192 1,192 1,192 1,192 1,192 1,192
Total 1,192 1,490 1,564 1,583 1,587 1,589
Office supplies consumed (894) (1,117) (1,173) (1,187) (1,191) (1,191)
Office supplies on hand 298 372 391 396 397 397

Septembe Octobe Novembe Decembe

July August r r r r Total
397 397 397 397 397 397 -
1,192 1,192 1,192 1,192 1,192 1,192 14,300
1,589 1,589 1,589 1,589 1,589 1,589 14,300
(1,192) (1,192) (1,192) (1,192) (1,192) (1,192) (13,903)
397 397 397 397 397 397 397

Licenses and Permits 2021 2022 2023 2024 2025

Business Permit 1,500 1,500 1,500 1,500 1,500
Fire Safety 650 650 650 650 650
BIR Annual Registration 500 500 500 500 500
SEC 3,500 4,375 4,375 4,375 4,375
DTI 500 - - - -

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 Barangay Clearance 500 - - - -
7,150 7,025 7,025 7,025 7,025

Bad Debts Expense

2021 2022 2023 2024 2025
2,256,00 2,481,60 2,729,76 3,002,73
Loans Receivable, end 0 0 0 6 3,303,010
Percent of
uncollectibility 1% 1% 1% 1% 1%
Required Allowance 22,560 24,816 27,298 30,027 33,030

Required Allowance 22,560 24,816 27,298 30,027 33,030

Allowance for BD, beg 0 22,560 24,816 27,298 30,027
Bad Debts Expense 22,560 2,256 2,482 2,730 3,003

Advertising Expense
2021 2022 2023 2024 2025
Per month 500 500 500 500 500
Months per year 12 12 12 12 12
TOTAL 6,000 6,000 6,000 6,000 6,000

Rental Withholding Tax-Expanded

January February March April May June

902 902 902 902 902 902
July August September October November December
902 902 902 902 902 902

Schedule 6 – Consideration of MCIT

2021 2022 2023 2024 2025

GROSS INCOME 2,406,000 2,646,600 2,911,260 3,202,386 3,522,625
ALLOWABLE
DEDUCTIONS:
Salaries Expense (760,320) (783,130) (806,623) (830,822) (855,747)
13th Month Pay (63,360) (65,261) (67,219) (69,235) (71,312)
SSS, PhilHealth & (152,184) (161,410) (168,043) (177,854) (183,697)

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PAG-IBIG
Contribution
Office Supplies
Expense (13,903) (14,042) (14,182) (14,324) (14,467)
Depreciation
Expense (67,985) (67,985) (67,985) (67,985) `(67,985)
Utilities Expense (30,433) (31,346) (32,287) (33,255) (34,253)
Taxes & Licenses (7,150) (7,025) (7,025) (7,025) (7,025)
Rent Expense (216,361) (216,361) (216,361) (216,361) (216,361)
Fuel Expense (107,923) (111,160) (114,495) (117,930) (121,468)
Bad Debts
Expense (22,560) (2,256) (2,482) (2,730) (3,003)
Advertising
Expense (6,000) (6,000) (6,000) (6,000) (6,000)
TAXABLE NET
INCOME 957,821 1,180,623 1,408,558 1,658,864 1,941,306

RCIT (30% of NI) 287,346 354,187 422,567 497,659 582,392

MCIT (2% of GI) 0 0 0 0 70,452

7.5 Financial Analysis

Liquidity Ratios
Current Ratio

2021 2022 2023 2024 2025

Current Asset 2,500,769 3,042,718 3,765,914 4,688,658 5,835,790

Current Liabilities 569,663 707,190 866,411 1,049,965 1,260,198

Current Ratio = 4.39 4.30 4.35 4.47 4.63

Acid Test Ratio

2021 2022 2023 2024 2025

Quick Asset 2,500,372 3,041,919 3,764,710 4,687,045 5,833,764

54
 Current Liabilities 569,663 707,190 866,411 1,049,965 1,260,198

Acid Test Ratio = 4.39 4.30 4.35 4.46 4.63

Liquidity ratios determine a company's ability to cover short-term obligations. The

higher the ratio, the better the company’s liquidity position. Here, it is shown that the
company is liquid enough to pay back its current liabilities.

Profitability Ratio
Net Profit Ratio

2021 2022 2023 2024 2025

Net income 670,475 826,436 985,991 1,161,205 1,358,914
Total Interest Income 2,406,000 2,646,600 2,911,260 3,202,386 3,522,625

Net Profit ratio = 0.28 0.31 0.34 0.36 0.39

Return on Sales

2021 2022 2023 2024 2025

Net operating income 957,821 1,180,623 1,408,558 1,658,864 1,941,306
Total Interest Income 2,406,000 2,646,600 2,911,260 3,202,386 3,522,625

Return on sales = 0.40 0.45 0.48 0.52 0.55

Return on Assets

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 2021 2022 2023 2024 2025
Net Income 670,475 826,436 985,991 1,161,205 1,358,914
Average assets 2,850,138 3,087,120 3,651,707 4,406,692 5,373,645

Return on Assets = 0.24 0.27 0.27 0.26 0.25

Return on Equity

2021 2022 2023 2024 2025

Net Income 670,475 826,436 985,991 1,161,205 1,358,914
Average equity 2,280,475 2,448,693 2,864,906 3,448,504 4,218,564

Return on equity = 0.29 0.34 0.34 0.34 0.34

Profitability ratios are a class of financial metrics that are used to assess a
business's ability to generate earnings relative to its revenue, operating costs, balance
sheet assets, and shareholders' equity over time, using data from a specific point in time.
As shown above, it is projected that the profitability of the company will be steadily
progressing through the years.

Solvency Ratio
Debt Ratio

2021 2022 2023 2024 2025

Debt 569,663 707,190 866,411 1,049,965 1,260,198
Assets 2,850,138 3,324,101 3,979,313 4,834,072 5,913,219

Debt Ratio = 0.20 0.21 0.22 0.22 0.21

Debt to Equity Ratio

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 2021 2022 2023 2024 2025
Debt 569,663 707,190 866,411 1,049,965 1,260,198
Equity 2,280,475 2,616,911 3,112,902 3,784,107 4,653,021

Debt to Equity Ratio

= 0.25 0.27 0.28 0.28 0.27

Solvency ratios are concerned with a longer-term ability to pay ongoing debts.
The result of the financial analyses above show that the company is solvent enough to
payback its long term obligations.

Payout Ratio
Dividend Payout Ratio

2021 2022 2023 2024 2025

Dividends 490,000 490,000 490,000 490,000 490,000

Net Income 670,475 826,436 985,991 1,161,205 1,358,914

Dividend Payout
=
Ratio 0.7308 0.5929 0.4970 0.4220 0.3606

Dividend Payout Ratio shows the percentage of a company's earnings paid out
as dividends to shareholders. A low payout ratio can indicate that a company is
reinvesting the bulk of its earnings into expanding operations while a payout ratio over
100% indicates that the company is paying out more in dividends than its earnings can
support. As shown on the table above, the percentage of payout ratio per year is slowly
declining which may signify that the company’s dividend payout program is getting
sustainable throughout the years by paying smaller percentage of its income to
shareholders and investing more in growing the business which will favor the company
and the shareholders in the long run.

Payback Period

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 2,100,00
Total Investment 0
Less: Annual Cash Inflow

2021 2022 2023 2024 2025

670,47 826,43 1,161,20 1,358,91
Net Income 5 6 985,991 5 4
Add: Depreciation 67,985 67,985 67,985 67,985 67,985
Bad Debt expense 22,560 2,256 2,482 2,730 3,003
761,02 896,67 1,056,45 1,231,92 1,429,90
Annual Cash Inflow 0 8 7 0 2

Year Period
This Date To Date Balance to Date s
2021 761,020 761,020 1,338,980 1
1,657,69
2022 896,678 7 442,303 1
1,056,45 2,714,15
2023 7 4 (614,154) 1
1,231,92 3,946,07
2024 0 4 (1,846,074)
1,429,90 5,375,97
2025 2 6 (3,275,976)
3
Payback period = Investment is to be recovered in the 3rd period of operation.

Payback Period refers to the amount of time it takes to recover the cost of an
investment it is the length of time an investment reaches a break-even point.

Present Value of Net Cash Inflow

Annual PV of
Year PVF
Cash Cash
(16%)
Inflow Inflow
2021 761,020 0.8621 656,052
2022 896,678 0.7432 666,377
2023 1,056,457 0.6407 676,827
2024 1,231,920 0.5523 680,378
2025 1,429,902 0.4761 680,795
Total PV of Cash Inflow 3,360,430
Less: Total Cash Of Investment 2,100,000
Net Present Value
= 1,260,430

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Accounting Rate of Return

2021 2022 2023 2024 2025

Net Income 670,475 826,436 985,991 1,161,205 1,358,914

2,100,00
Cost of Investment 0 2,100,000 2,100,000 2,100,000 2,100,000

=
Accounting Rate
of Return 0.3193 0.3935 0.4695 0.5530 0.6471

Accounting Rate of Return (ARR) is the average net income an asset is expected
to generate divided by its average capital cost, expressed as an annual percentage.

Internal Rate of Return

where:
Ct = net cash inflow during the period t
C0 = total initial investment costs
r = discount rate
t = number of time periods

Total Cost of Investment (2,100,000

)
Annual Cash Inflow: 2021 761,020
2022 896,678
2023 1,056,457
2024 1,231,920
2025 1,429,902

Internal Rate of Return = 36.76%

The internal rate of return (IRR) is a metric used in capital budgeting to estimate
the profitability of potential investments. The internal rate of return is a discount rate that
makes the net present value (NPV) of all cash flows from a particular project equal to

59
zero. IRR calculations rely on the same formula as NPV does. The higher a project's
internal rate of return, the more desirable it is to undertake.

Here, the result of the Internal Rate of Return above signifies that this
undertaking is favorable to be accepted as a good investment, assuming that this will be
used as the sole basis of such decision.

Chapter VIII
SOCIAL ASPECT

The contribution of this company to the society and the economy is, primarily, to
satisfy and fulfill the demands of the poor and middle class by making loans for them
easily accessible and available in affordable and reasonable rates.

This business will also be beneficial to the economy because of the job
opportunities it would offer to the unemployed. Once hired, employees will receive salary
and may use that income for their consumption that would be of help to fuel the
betterment of the economy.

Lastly, as mandated by law, owners and the business are very much required to
pay their corresponding tax obligations. Taxes are government-generated funds that will
be utilized for the improvement of public service and government projects.

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 Chapter IX
OPERATIONS OF THE BUSINESS

9.1. Government Requirements for Operation

For this proposed project to be implemented, it must be ensured that all

operations of this business, GOLDEN BANTTAM LENDING CORPORATION, complies
to the Republic Act 11232 otherwise known as the “Revised Corporation Code of the
Philippines”, Republic Act 9474 otherwise known as the “Lending Company Regulation
Act of 2007”, and Republic Act 3765 otherwise known as the “Truth in Lending Act”.

It must also be duly registered to the Securities and Exchange Commission

(SEC), Iloilo City Business and Licensing Office and to Barangay Our Lady of Lourdes.

9.2. Taxation

The Regular Corporate Income Tax (RCIT) rate, which is computed as 30% of
the taxable net income, is applicable to all corporations. However, in the fourth taxable
year immediately following the year in which the corporation commenced its operation,
either the Minimum Corporate Income Tax (MCIT) rate of 2% of the gross income or the
aforementioned RCIT scheme is applied, whichever is higher.

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 Chapter X
EVALUATION

10.1 Summary and Conclusion

The establishment of a lending company in Jaro, Iloilo City that targets micro-
businesses, private employees and pensioners appears to be feasible as shown by the
results of the financial analysis of this study.

According to the research done, Iloilo City is currently one of the cities in the
Philippines that has a fast growing economy. Further survey also revealed that there is a
considerable amount of potential clients in the target market that we can cater our
financial services to.

Bearing the name Golden Banttam Lending Corporation, this proposed business
aims to revolutionize the lending business by making financial borrowing easily
accessible to those who is in need of it. Products offered are bundled with a reasonable
interest rate and minimum documentary requirements.

Prior to the commencement of operations, the company was first registered to

the government agencies required to put up a lending company. All fees were paid on
time in compliance to the policies in setting up this kind of business.

Procurement of essential assets such as supplies, furniture and fixtures, and

equipment, with its present corresponding price were considered in the study.
Conventional depreciation method and realistic usage assumptions were used to
ascertain the reliability of the study.

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 Its manpower is humbly composed of essential workforce that a lending company
usually has. It is made sure that all employees were qualified, well trained and well taken
care of to create a productive and friendly workplace environment.

One of the known dilemmas in this line of business is the risk of clients not
paying the demandable amount, whether delayed or not at all. So to ensure collection
from its clients, the company, through certain policies like scrupulous Credit
Investigation, makes it certain that its potential client is capable of paying back debt.

As shown in the financial statements, there is not a single year that the company
will incur a loss. Expenses were put to a minimum to conserve funds without sacrificing
the efficiency and effectivity of the performance of the company.

Being a corporation, it is only normal to declare dividends for the purpose of

satisfying the shareholders. In the first five years of its operation, it was decided by the
Board of Directors to declare shares at a moderate price to reserve funds just in case
the demand for loans increase and there is a need to cater such demand.

This business is not only setting its sights on profit from its clients but it also
focuses on how it can help them achieve their dreams. Through providing financial
assistance, many problems are solved and dreams are turned into reality. In addition, by
complying to the laws in starting up and operating a lending company, it is setting an
example to others that obtaining a considerable amount of income can be attained
through legal ways and will most likely create harmonious relationships not only to the
stakeholders of the company but to the economy as a whole.

10.2 Recommendations
The proponents of this study recommends that this business, in the future, can
allocate a significant portion of its cash restricted for acquisition of assets that can
generate more cash inflow for it to create a new source of income for the company.

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 Moreover, if the business decides to expand its operations, hiring more
competent employees is highly suggested to improve the effectiveness and efficiency of
the company.

Lastly, as the business grows, better dividend payment programs must be

implemented by the Board of Directors to further satisfy the shareholders and attract
more people to invest in the company.

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