How to fill in this financial statement
- 1Business name
e.g. Mercado General Merchandise - 2Business address
e.g. Public Market Road, Brgy. Poblacion, San Jose, Nueva Ecija - 3TIN line
e.g. NON-VAT REG. TIN 214-563-870-00000 - 4Period
e.g. For the year ended - 5Period end
e.g. December 31, 2025 - 6Sales
e.g. 2,850,000.00
How the income statement is worked out
Type the figures from your books for the period; the paper does every subtraction. Net sales are sales less returns and discounts. Cost of sales is the inventory you started with, plus what you bought, less what was left at the end count. Gross profit is net sales less cost of sales; take away operating expenses for operating income, add other income, take away income tax, and you have net income.
A service business with no inventory leaves the three inventory lines empty; its cost of sales is then zero, or type its direct costs as purchases.
Figures people most often get wrong
Check these before the owner signs.
- Ending inventory comes from an actual count on the last day, not an estimate.
- Owner's withdrawals are not expenses — they belong in the balance sheet as drawings.
- Depreciation is an expense even though no cash went out; loan principal paid is not an expense, only its interest.
- Taxes and licenses include percentage tax, the mayor's permit and the BIR registration fee; income tax goes on its own line.
Questions people ask
Is this an audited financial statement?
No. It is prepared by management — the owner or the bookkeeper — from the business's own books, and the paper says so. Audited statements carry an independent CPA's report and are signed by the CPA. Use this for a bank or supplier, for your own review, or as the draft your CPA works from.
When does the BIR require audited statements?
Under the Tax Code as amended by the TRAIN law, a business whose gross annual sales or receipts exceed PHP 3,000,000 must attach financial statements audited by an independent CPA to its annual income tax return. Corporations also file with the SEC under its own thresholds. Below PHP 3,000,000, statements certified by the owner are generally accepted — check with your RDO or accountant.
Can a bank use this for a loan?
Many banks and lending companies accept management-prepared statements from small borrowers together with the BIR-stamped income tax return and bank statements. Bigger loans usually need audited ones.
Can I save it and update it next year?
Save it to My Desk. Next period open it, change the figures and the date, and download. Saved papers are encrypted — we never read them.
This page explains common practice and is not legal advice. Offices set their own rules — when in doubt, call ahead or ask your notary or lawyer.