Financial Statements Notation: Contract of Services

Financial Statements Notation:  Contract of Services

This notation is number 12 in years 2009, 2010 and 2011 then changes to number 14 in 2012.  In the first three years, it only covers Administrative staff and overhead cost.  What is overhead cost?  This is not explained when SGV handled the audit.  In 2012 there is a major change when Diaz handles the audit.  The statement in the notation does not seem to make any sense in 2012.

Where are the Janitorial and Security services in the 2012 Financial Statements?  They were separate items in the previous years.  But in 2012 in the Statements of Comprehensive Income under Expenses a new line named Subcontractor services is stated.  I would assume that this would include services in addition to Administrative.  Of course, administrative services are handled by Century Properties Managements Inc (CPMI).

Why is CPMI services defined as "administration, upkeep and maintenance?"  Does this figure include Janitorial listed separately in the past.  Yes, the endless confusion and lack of information and refusal to present all documents is making the managing of the condominium corporation difficult to follow and increasingly questionable.

Why are the services seen listed in the first three years not clearly defined in the notation much less Statements of Comprehensive Income for 2012?  Who is looking to clarity regarding the Financial Statements?  The Unit Owners who are members of the Soho Central Condominium Corporation are being left in the dark with frustration and confusion.  This is no way to run things.

As for another serious issue regarding the management serviced by CPMI, has anyone read Section 44 of the Corporation Code?  When did the vote take place by Unit Owners, members?  The code says five (5) years and not seven (7) years for a management contract.  Why is the code not being followed?

http://sohocentralcondominium.blogspot.com/2013/03/title-iv-section-44-of-corporate-code.html

 

BATAS PAMBANSA BLG. 68
THE CORPORATION CODE OF THE PHILIPPINES

 

TITLE IV — POWERS OF CORPORATIONS

SECTION 44. Power to enter into management contract. — No corporation shall conclude a management contract with another corporation unless such contract shall have been approved by the board of directors and by stockholders owning at least the majority of the outstanding capital stock, or by at least a majority of the members in the case of a non-stock corporation, of both the managing and the managed corporation, at a meeting duly called for the purpose: Provided, That (1) where a stockholder or stockholders representing the same interest of both the managing and the managed corporations own or control more than one-third (1/3) of the total outstanding capital stock entitled to vote of the managing corporation; or (2) where a majority of the members of the board of directors of the managing corporation also constitute a majority of the members of the board of directors of the managed corporation, then the management contract must be approved by the stockholders of the managed corporation owning at least two-thirds (2/3) of the total outstanding capital stock entitled to vote, or by at least two-thirds (2/3) of the members in the case of a non-stock corporation. No management contract shall be entered into for a period longer than five years for any one term.

The provisions of the next preceding paragraph shall apply to any contract whereby a corporation undertakes to manage or operate all or substantially all of the business of another corporation, whether such contracts are called service contracts, operating agreements or otherwise: Provided, however, That such service contracts or operating agreements which relate to the exploration, development, exploitation or utilization of natural resources may be entered into for such periods as may be provided by the pertinent laws or regulations. (n)

SECTION 45. Ultra vires acts of corporations. — No corporation under this Code shall possess or exercise any corporate powers except those conferred by this Code or by its articles of incorporation and except such as are necessary or incidental to the exercise of the powers so conferred. (n)

2009 - 2010

 

2011

2012

You may see all the Audited Financial Statements and other documents by looking at the right of the blog page.  Yes, the Annual Meetings have not had a good history and various legal issues are going to be dealt with since we need a condominium corporation running well with the ability to correct the past actions acting appropriately in the future.