2014 annual report - port of surigao

PHILIPPINE PORTS AUTHORITY - PMO SURIGAO ANNUAL REPORT 2014

ANNUAL REPORT

MOMENTUM-DRIVEN @ THIRTY SEVEN

2014


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Our Cover At 37 years, the Port Management Office of Surigao rides on the momentum largely driven by the long-running boom in the export of mineral products and the continued growth of the tourism industry.

As such, two icons symbolic of the mining and tourism industries, the “growth engines” driving the upward momentum, are given prominence on the cover design of the 2014 PMO Surigao Annual Report. A recent aerial photo of the Port of Surigao, a commemorative ‘37’ years icon, and the image of a pendulum in action (a familiar symbol of momentum) complements the design dominated by shades of Blue, Red and Yellow on White - the familiar colors of the PPA logo.

Message of the Port Manager 04

Shipping and Trade Performance 09

Physical Infrastructure Development and Maintenance 13

Sustainability, Environment and People 16

Financial Performance 18

Income Statement 20

Notes to Financial Statements 22

Executive Officers 25

Jurisdictional Map 27

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CI am pleased to report that the PORT

MANAGEMENT OFFICE OF SURIGAO

not only continued to remain on track in

meeting its targets and goals but per-

formed strongly in 2014, surpassing its tar-

get income by as much as 23% and topped

the prior year’s revenue by 21%. The PMO

once again posted its highest revenue ever

and came close to reaching half a billion

pesos as total revenue for CY 2014

amounted to PhP495,218,911.18.

Although largely driven by a still bullish lo-

cal mining industry, the sustained efforts of

the PMO’s Terminal Managers, the “Private

Ports Monitoring Team” and its “Internal

Control Unit” in monitoring the financial

performance and operational activities of

private ports tremendously improved col-

lection efficiency and further enhanced the

PMO’s financial position in 2014. Further-

more, the sustained robust growth of the

nation’s economy, and the improved busi-

ness confidence continue to boost trade

and commerce and increased the volume of

transactions at ports under the PMO.

Message of the PORT MANAGER

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C

ognizant of the importance of human resources develop-ment to upgrade the compe-tency of its personnel, the PMO sent employees to vari-ous trainings and scholarships.

In 2014, our then Port Manager Isi-dro V. Butaslac Jr. participated in the “Training of Trainers Workshop on Modern Port Management Course” held at Dublin, Ireland from March 25 to April 3, 2014.

Organized under the Train for Trade Program of the United Nations Con-ference on Trade and Development (UNCTAD), Senior Managers from port communities of the English-speaking network in Africa and Asia are recruited each year to partici-pate in an intensive training of train-ers' workshop and afterwards, serve as local instructors for their respec-tive ports.

Isidro V. Butaslac Jr., former PMO Surigao Port Manager

A total of seven in house Train-ings were attended by sixteen (16) personnel with a total of 120 training hours. Five (5) local In-House Trainings were con-ducted and attended by majori-ty of PMO Surigao personnel. The significant trainings attend-ed were as follows: Critical Inci-dent Management Seminar-Workshop (SW) on MARPOL Ratification, Implementation and Enforcement, Port Re-ceipting System, Orientation Seminar on Microsoft Office 365, SW on Coaching and Men-toring for Division Managers, training on Wellness (Batch 1 & 2), and GAD SW on Responsible Parenthood, Reproductive Health Law, Women Empower-ment and Development and Gender Equality.


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n line with the PPA’s Program on Awards and Incentives for Service Excellence (PRAISE), and to give due recognition to employees who manifested exemplary performance in

2014, the then Port Manager ISIDRO V. BUTASLAC, JR., was nominated by the PMO PRAISE Committee to the 2014 Service Awards given on the occasion of the PPA’s 40th Anniversary Celebra-tion. PM Butaslac was chosen for the “Best Performer Award.”

With only 48 organic personnel out of the 109 plantilla positions allocated under the PPA’s Rationalization Plan, PMO Surigao is practically undermanned. Yet despite the compulsory retirement of the three Division Managers of the Terminal Management Offices (TMOs) of Lipata, Dapa, and Tandag during the last quarter of 2013, the PMO still managed to effectively and efficiently deliv-ered 24/7 service to the public in 2014 under the competent leadership of then PMO Suri-gao Port Manager ISIDRO V. BUTASLAC, JR and continued when the undersigned took over the PMO’s helm on 05 November 2014.

I In compliance with GCG Conditions, PMO Su-rigao has complied with all the requirements by the Governance Commission for Govern-ment Owned and Controlled Corporations (GCG) such as PhilGEPS posting, Transparency Seal, Citizen’s Charter posting/updating, Com-pliance on COA Audit observations and SALN submission.

Moreover, in line with the government’s thrust to eliminate red tape and in conso-nance with RA 9845, the Anti-Red Tape Act of 2007, the Citizen’s Charter is conspicuously posted at PPA premises at the base port and at the terminals. As part of ARTA compliance, monthly ARTA reports were likewise sub-mitted to the Head Office and the Civil Service Commission.

True to its aim at providing the best service, and in compliance with the GCG’s directive on transparency and policy shift to-wards openness in access to government information, PMO Surigao has continued to main-tain its own website where eve-ryone could access online the PMO’s Citizen’s Charter, PMO Directory, Port Tariff, Transpar-ency Seal, Performance High-lights and many others. To visit the PMO Surigao website, www.ppasurigao.weebly.com

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s part of its mandate, and to ensure that all port facili-ties under its jurisdiction maintain their

serviceability and safety through the provision of ade-quate and modern port facili-ties, the PMO, through the Engineering Services Division, completed twelve (12) repair projects and five (5) locally-funded projects in CY 2014. A major development initiative pursued by the PMO in 2014 was the development of port facilities at the Lipata Ferry Terminal which serves as the

n regard to security of lives and properties at our ports, the year 2014 was one challenging year as the PMO enforced heightened security alert to en-sure the safety, security and comfort of port users, passengers and rolling cargoes.

Technology was tapped with the constant use of CCTV Video Recording Cameras, 300 KVA power generating and solar-powered lights set at Baseport and Port of Lipata. The 32 CCTV cameras with 3 Video Recording/Monitoring sets were installed at the strategic areas of Baseport for the securi-ty monitoring/video documentation on the movement of car-goes, vehicles, port users and other activities and the estab-lishment of CCTV Security Monitoring Center.

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hub to three “spoke” ferry terminals, namely the Port of Liloan; the Port of San Ricardo and the recently opened Port of Cabalian. The gateway to Mindanao in the country’s roro termi-nal system, the Lipata Fer-ry Terminal has undergone massive reconstruction and improvement in 2014. The project expanded the port’s back-up area by about half a hectare and constructed additional roro berthing facilities to simul-taneously accommodate two more roro vessels for a total of four roro berths.

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s a Responsible Corporate Citizen,

PMO Surigao shall continue working

towards upholding the highest stand-

ards of corporate governance. We

shall continue to operate and main-

tain ports in accordance with recognized best

practices in the maritime logistics industry, and

establish fair and equitable business relation-

ships beneficial to both port stakeholders and

the government. The PMO shall exert effort to

uplift the lives and provide our personnel with

a work environment that is not just conducive

to increased productivity; but one that also

offer opportunities for career advancement .

A

MILDRED J. PADILLA Acting Port Manager

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long with the improved business climate, the PMO took steps aimed to im-prove the ease of doing business at our ports in 2014. The streamlined and

simplified business processes such as re-ducing documentary requirements for clearances and permits, not just translated to good business but also led to improved customer relations, generated valuable goodwill and projected the image of re-sponsible corporate citizenship.

With the country’s strong and upbeat eco-nomic performance in 2014, operational activities at our ports, particularly in the ex-port of mineral products, mirrored the na-tion’s bullish economy. Cargo traffic handled at our ports in 2014 reached 36 million metric tons or an impressive 12% percent growth from prior year’s cargo throughput. Vessel calls also increased as 752 foreign vessels made calls at various ports under the PMO in 2014, representing a 16% increase from last year’s foreign traffic. On the other hand, pas-senger traffic remained relatively at par with last year’s figures. With increased competition from the airlines offering cheap promotional fares, major shipping lines such as 2Go Group suspended long haul routes connecting Suri-gao to Manila or to other major ports in 2014.

Shipping and Trade

PERFORMANCE

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Cargo

“With the country’s

strong and upbeat economic

performance in 2014, operational activities

at our ports, particularly those

involved in the export of mineral products, mirrored the nation’s

bullish economy.”

I N M E T R I C TO N S

I N M E T R I C TO N S

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“Vessel calls also increased as 752

foreign vessels made calls at various ports

under the PMO in 2014, representing

a 16% increase from total foreign

traffic for the previous year.”

Shipcalls


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Passenger

“Passenger traffic remained relatively at

par with CY 2013 figures. With increased competi-

tion from the airlines offering cheap promo-

tional fares, major ship-ping lines such as 2Go

Group, suspended routes connecting Surigao to

Manila as well as routes to other major ports.”

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PHYSICAL INFRASTRUCTURE

Development and Maintenance

asked to develop, pre-

serve and maintain port

facilities under PMO-

Surigao which covers the provinces

of Surigao Del Norte, Surigao del

Sur and Dinagat Island, the PMO’s

Engineering Services Division had

its hands full in CY 2014.

T Composed mainly of coastal and island communities, the seaports in these provinces

serve as vital infrastructure: bridging the gap between production and consumption

centers as primary maritime access to markets and social services. Hence, the provision

of appropriate and well maintained port facilities is e a necessity to bring about pro-

gress and economic development in these communities.


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Provision of Adequate and Modern

PORT FACILITIES

I n the provision of adequate

and modern port facilities,

the PMO has completed twelve (12)

repair projects and five (5) locally-

funded project for CY 2014. It also

implemented three (3) on-going re-

pair projects and two (2) on-going

locally funded project. Three (3)

capital outlay projects were also im-

plemented by FCMD Head Office,

one of which was already 100%

completed.

New Passenger Terminal Bldg., Port of Del Carmen

Passenger Arrival Facility (extension of existing passenger terminal), Lipata Ferry Terminal

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Preservation and Maintenance of

PHYSICAL FACILITIES

n the preservation and mainte-

nance of Physical Facilities,

PMO-Surigao, managed to complete

the implementation of minor repairs

and preventive maintenance on port

facilities and has completed six (6)

small value contracted projects.

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Repair of Port Lighting System, Lipata Ferry Terminal


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Sustainability, Environment and

PEOPLE

T he year 2014 was one challenging year for the PMO. Throughout the year, the PMO’s Port Police Division enforced heightened security alert to ensure the safety, security and comfort of port users, passengers and rolling cargoes

To address the needs of the riding public and provide valuable assistance especially during passenger season, Passenger Assis-tance Centers/Help Desk were installed at the entrance of PTBs of each ports under PMO-Surigao and manned 24/7 by PMO Volunteers (regular and outsourced per-sonnel), and personnel complement from the Philippine Coast Guard, MARINA, PNP Maritime Command, the Philippine Navy and the various shipping companies.

32 CCTV cameras with 3 Video Recording and Monitoring sets were installed at the strategic areas of Baseport for the security monitoring/video documentation on the movement of cargoes, vehicles, port users and other activities, along with the estab-lishment of a CCTV Security Monitoring Center. Furthermore, the 300 KVA power generating set to sufficiently illuminate the port at nighttime especially during power failures

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he Port Management Office of Surigao is efficiently manned by only 48 organic personnel - which is practically under-

manned - if we take into consideration the 109 plantilla positions under the PPA RATIONALIZATION PLAN.

Despite the compulsory retirement of the three Divi-sion Managers of the terminal ports of Lipata, Dapa, and Tandag during the last quarter of 2013 and 1st quarter of 2014, the PMO remained efficiently man-aged and delivered competent service through a 24/7 hour shift

As a token of appreciation, the PMO recognized 20 employees who has served the PPA for 20 years (and above) and were given token gifts with cash. On the other hand, 24 personnel were recommended, and eventually received, step increments for 2014.

The Administrative Division has continued the imple-mentation of austerity measures as part of its com-mitment to create savings for the PMO. The savings as reflected in 2014 Budget vs Utilization Comparative Presentation, and the negative variance (Actual 2014 vs Actual 2013) were made possible due to the regular monitoring done by the Administration personnel with the support and cooperation of the concerned RCs.

T

Particulars

Actual Actual % 2014 2014 %

2014 2013 Variance Budget Utilization Variance

SUPPLIES & MATERIALS

1,191,805.61 1,125,682.11 6% 1,192,171.00 1,191,805.61 0%

POWER 2,755,352.30 2,868,651.87 -4% 3,471,384.00 2,755,352.30 -21%

WATER 1,785,658.35 2,103,234.61 -15% 4,196,260.00 1,785,658.35 -57%

FUEL 728,049.41 968,381.74 -25% 751,800.00 728,049.41 -3%


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Financial

PERFORMANCE

“PMO Surigao not only continued to remain on track

in meeting its targets and goals but performed strongly in 2014,

surpassing its target revenue by as much as 23% and exceeded the

previous year’s income by 21%. The PMO again posted its highest

revenue ever and came close to reaching half a billion pesos as total

income amounted to PhP496 Million.”

L E G E N D

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Financial HIGHLIGHTS

Gross Earnings at PhP496 Million, up by 21% from prior year’s income and exceeded target by as much as 23%

B U D G E T U T I L I Z AT I O N

Operational Expense 2014 Allocation Utilization

Personal Services 32,556,234.00 27,881,470.85

MOOE 143,085,669.00 123,032,769.47

Increased Net Income by 31% at PhP 296 Million (2013 Net Income: PhP205 Million)

Net Income Ratio is at 60% (Net Income/Gross Revenue) while Collection Efficiency and Liquidation of Cash

Advances are both at 100%

Taxes and Licenses (100%) Fully Paid

Full (100%) Utilization of AFMS Applications


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Port Management Office of Surigao

STATEMENT OF COMPREHENSIVE INCOME For the Year Ended 31 December 2014

Income Statement

CY 2014 CY 2013

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Income Statement

CY 2014 CY 2013


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AGENCY BACKGROUND

The Port Management Office of Surigao officially came to exist on August 1, 1977 when the Philip-pine Ports Authority established its port manage-ment unit in Surigao City and took over the port op-erations, maintenance and related functions from the Bureau of Customs and from the then Bureau of Public Works. Its’ base port, the Port of Surigao, has a long and colorful history that dates back to the arrival of Fer-dinand Magellan in 1521. From the Island of Homonhon, sailing through the strait of Surigao along the coast of Dinagat Island; Magellan’s fleet dropped anchor at Surigao for watering before pro-ceeding to Cebu where he was killed at Mactan. Development of the Port of Surigao under the Fourth IBRD package was bidded on March 12, 1987 and awarded to F.T. Sanchez Construction on April 8, 1987. The contract took effect on September 28, 1987. The project was formally inaugurated on July 9, 1990 thus modernizing the port enhancing its role as a gateway to Mindanao. The PMO has jurisdiction over various ports in the provinces of Surigao Del Norte (including Siargao and Bucas Grande Islands), Surigao del Sur and the Province of Dinagat Islands. Passengers and cargoes from Southern Leyte and even Agusan Del Sur and Norte are handled at Surigao thereby making it the premier port in the Caraga region. Under PMO Surigao’s supervision are the three Ter-minal Management Offices namely Lipata in Surigao del Norte; Dapa in Siargao Islands which also super-vises ports in the Province of Dinagat Islands; and Tandag in Surigao del Sur.

Forms and reports as well the schedules of the differ-ent accounts generated thru the AFMS, developed using Oracle Software were customized to be compli-ant with the requirements of the National Govern-ment Accounting System (NGAS). The PMO’s consoli-dated financial statements include the financial trans-actions of Baseport, TMO Lipata, TMO Dapa and TMO Tandag. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of the Financial Statements The accompanying financial statements were pre-pared using the New Government Accounting System (NGAS) accounts prescribed under COA Circular No. 2004-2, the financial statements have been prepared using the historical cost convention and accrual basis of accounting.

The books and reports generated thru the Accounting and Financial Management System (AFMS), a sub-system of the PPA Computerized system were used as basis in the preparation of the financial report for submission to COA. The system uses the NGAS Chart of Account under COA Circular No. 2008-06. With the recall of the said circular, accounts were mapped to those prescribed in COA Circular No. 2004-002 to generate the required COA reports.

Forms and reports as well the schedules of the differ-ent accounts generated thru the AFMS, developed using Oracle Software were customized to be compli-ant with the requirements of the National Govern-ment Accounting System (NGAS). The PMO’s consoli-dated financial statements include the financial trans-actions of Baseport, TMO Lipata, TMO Dapa and TMO Tandag.

Notes to Financial STATEMENTS

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The financial statements were prepared in conformi-ty with applicable provisions of the following Philip-pine Accounting Standards (PAS) and Philippine Fi-nancial Reporting Standards (PFRS) consistent with previous year’s financial reports: PAS 1 Presentation of Financial Statements PAS 2 Inventories PAS 7 Cash flow Statement PAS 10 Events after the Balance Sheet Date PAS 16 Property, Plant and Equipment PAS 18 Revenue PAS 19 Employee Benefits Statement of Compliance There are no transactions or cases in 2014 that would warrant the application of PAS 8. Accounting Policies, Changes in Accounting Estimates and Errors and PAS 20, Accounting for Government Grants and Disclo-sure of Government Assistance. All other accounting standards, financial reporting standards and financial interpretation issued by the Philippine Interpretation committee were deemed not applicable in ac-counting for the transactions of the Philippine Ports Authority, a government owned and controlled cor-poration. Presentation of Financial Statement Presentation and classification of items in the Bal-ance Sheet, Statement of Income and Expenses, Cash flow Statement and Statement of Changes in Equity are consistent with prior year’s financial statements and generally conform to the provision of PAS 1, Presentation of Financial Statements. Likewise, com-parative information and aggregation of each materi-al class of items, as presented separately, are con-sistent with prior year’s statement. The accounts required to be presented in the face of the Balance Sheet and Income Statement conforms to the provision of the PFRS 1. The financial state-ments were prepared using the accrual principle ex-cept for the Cash flow Statement. Each Material class of similar items is presented separately in the finan-cial statements while dissimilar items whose amounts are considered immaterial were aggregated with prior year’s presentation .

Cash Cash are carried in the balance sheet at cost. For the pur-pose of the Balance sheet presentation, cash consist of Cash on Hand and Cash in Bank, under cash on hand are Cash-collecting Officers, Cash- Disbursing Officers and Petty Cash Fund. Philippine National Bank is the Deposi-tory bank both for current and savings account of the PMO. Receivables Accounts Receivables are recognized and carried at origi-nal invoice amount less an allowance for doubtful ac-counts. An estimate for doubtful accounts is being set up base on the following estimates: Age (days) of Account Rate of Allowance Days 5% 31-90 Days 10% 91-180 Days 20% 181-365 Days 40% Over 365 Days 60% Dormant with Nil Chance 100% Prepayments This account includes the following: Advances to Contractors not exceeding 15% of the total contract price are granted pursuant to Republic Act 9184. The advances, which are repaid thru deductions from progress payments to Contractors, are secured with irrevocable letters of credit of equivalent values from commercial banks, bank guarantees or surety bond. Prepaid Taxes consist of the amounts of expanded or creditable withholding taxes deducted by port users from wharfage, vessel charges, rental of real property and other port facilities. Section 76 of the National Inter-nal Revenue Code allows cash refund of the amount withheld or the use of covering tax credit certificates against future tax. Other Prepayments The account includes advance pay-ment made to suppliers for the use/rental of facility. Other Current Assets This account includes the following: Input-Value Added Tax pertains to the carried over bal-ance of VAT paid by the Authority for acquired goods and services that may be applied as tax credit or deducted from the remittance of Output VAT.


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Deposit on Containers consist of the amount deposited to contractors/suppliers for the use/rental of facility. Property and Equipment Property and equipment are carried at cost less accu-mulated depreciation and impairment in value. Initially, Property and Equipment is measured at its cost, which comprises its purchase price and any direct attributable costs of bringing the asset to working con-dition. Depreciation is computed based on the carrying values of the assets using the straight-line method with 10% salvage value and based on estimated useful lives pro-vided by Head Office Accounts Payable Trade/Business Payables are obligations incurred in the procurement of goods and services from private suppliers and entities arising from the conduct of busi-ness operations. Due to Officers and Employees consist of liabilities set-up for the payment of services rendered by employees i.e, salaries, overtime bonuses, incentives, allowances, reimbursement of official expenses, and other claims due to PPA personnel Payables to Other Government Agencies Inter-Agency Payables This account is comprised of payables involving the mandatory deductions withheld from salaries of personnel that are due for remittance in payment of taxes, employees’ insurance premium contributions and loan amortizations. Also include are liabilities for advances made by other government agencies for specific purpose. Intra-Agency Payables consist substantially of deduc-tions on salaries of personnel for Pantalan Union Dues and Employees Cooperative. Depository Liabilities are deposits other than those required to guaranty the performance of contracts

Other Bonuses and Allowances Bonuses and allowance other than the 13th month pay and cash gift granted to officials and employees as authorized by board in accordance with appropriate legal basis. Office Supplies and Materials Cost of expendable commodities acquired in connection with PPA operation. It also includes, but is not restricted to items (1) normally consumed within one year after being put into use, or (2) converted in the process of manufacture or construction, having a life expectancy of more than one year but which shall have decreased substantially in value after being put into use in only one year. Traveling Expenses Actual and necessary expenses incurred by any official or employees while on official travel and away/absent from official permanent station whether by land, sea or air in-cluding transportation, subsistence, lodging, per diems transportation of personnel baggage and other similar Utility Expenses Cost of water and electricity or gas for illumination, con-sumed in government facilities such as in office buildings and grounds, port structure etc in connection with govern-ment operations and projects. Repairs and Maintenance It consolidates cost of repairing and maintaining port facili-ties such as public buildings, roads, bridges, irrigation sys-tems, river control and sea protection works, artesian wells, water supply systems, telegraph lines, radio stations, wharves and other public structures. Other Professional Services Cost of other professional services contracted by PPA not classified under specific professional services accounts.

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Executive OFFICERS

NELDA R. CANTUTAY Acting Manager, Finance Division

FROILAN U. CATURLA Manager, Port Police Division/Acting Port Services Division Manager

YOLANDA FRANCISCA A. TAN Acting Manager, Administrative Division

ROLANDO C. BUCTON Manager, Engineering Services Division

MILDRED J. PADILLA Acting Port Manager


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VIRGINIA M. CAMPOS Acting Manager, Terminal Management Office of Lipata

JERK E. COMPARATIVO Acting Manager, Terminal Management Office of Dinagat

DEBS G. CONSUEGRA Acting Manager, Terminal Management Office of Tandag

EDNA G. PANTILO Acting Manager, Terminal Management Office of Siargao

Executive OFFICERS

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Jurisdictional MAP


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Produced by:

MARKETING & MEDIA PRODUCTION UNIT Office of the Port Manager

Port Management Office of Surigao

PPA Administration Bldg., Borromeo St., Port Area, Surigao City 8400 PHILIPPINES Tel. Nos. (086) 826-2015 ● 826-5233 ● 231-7742 ● Fax No.: (086)826-5589

Email: [email protected] ● URL: www.ppasurigao.weebly.com

Design and Concept:

NOLE C. NUSOG Bus. Dev’t/Marketing Officer

2014 annual report - port of surigao

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