Chapter VII

Investment Property, Property, Plant and Equipment
and Biological Asset



Investment Property is a land or a building - or part of a building - or both held to earn rentals or for capital appreciation, or both, rather than for: (a) use in the production or supply of goods or services, or for administrative purposes; or (b) sale in the ordinary course of operations.

Property, Plant and Equipment (PPE) are tangible items that: (a) are held for use in the production or supply of goods or services, for rental to others, or for administrative purposes; and (b) are expected to be used during more than one reporting period.

Biological Asset is a living animal or plant.

The BT shall act as the Property Officer of the barangay and shall be responsible for the receipt, custody, issuance and physical inventory of barangay property, except for the buildings and other physical structures which shall be under the accountability and responsibility of the PB.

7.1 Specific Policies

Investment Property

7.1.1 Investment property shall be measured initially at cost (transaction costs shall be included in this initial measurement).

7.1.2 Where an investment property is acquired through a non-exchange transaction, its cost shall be measured at its fair value as at the date of acquisition.

7.1.3 The cost model of accounting for investment property shall be used for subsequent measurement after initial recognition. However, the fair value of all items of investment property at the end of each reporting period shall be disclosed in the Notes to FS.

Property, Plant and Equipment/Infrastructure Assets

7.1.1 Infrastructure assets shall form part of the PPE. These assets display some or all of the following characteristics:

- part of a system or network
- specialized in nature and do not have alternative uses
- immovable
- may be subjected to constraints on disposal

7.1.2 Procurement of PPE shall be charged against appropriations for Capital Outlay and included in the APP as required by RA 9184. These items shall be recorded in the appropriate PPE accounts.

7.1.3 Procurement of construction materials for infrastructure projects implemented by administration shall be governed by the applicable guidelines issued by Government Procurement Policy Board (GPPB).

7.1.4 All costs incurred during the construction of infrastructure assets shall form part of the cost of the project. Expenses incurred after its completion shall be charged to the appropriate expense accounts.

7.1.5 Issuances of property and equipment to the end users shall be acknowledged through the Property Acknowledgement Receipt (PAR) as shown in Annex 25 which shall be renewed at least every three years or whenever there is a change in custodianship.

7.1.6 Property/Equipment Card (PEC), see Annex 26.1, shall be maintained for all property and equipment of the barangay by the BT.

7.1.7 Property/Equipment Ledger Card (PELC), see Annex 26.2, shall be maintained by the C/M Accountant as subsidiary ledgers for all property and equipment of the barangay.



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