AYALA LAND INC.

Management Audit Approach

Controls

Real Estate *The group’s revenue *Group considers the *We obtained an
Recognition recognition process, significance of the understanding of the Group’s
policies and buyer’s initial revenue recognition process
procedure. These payment (buyer’s
involve application of equity) in relation to (1) For the buyer’s equity, we
significant judgement the total contract evaluated management’s
and estimation price basis of the buyer’s equity by
*Group uses an comparing this to the
(1) Assessment of the output method. This historical analysis of sales
probability that the method measures collections from buyers with
entity will collect the progress based on accumulated payments
consideration from the physical above the collection
the buyer proportion of work threshold
done on the real (2) for the application of the
(2) application of the estate project which output method, in
output method as the requires technical determining real estate
measure of progress determination by the revenue, we obtained an
in determining real Group’s specialists understanding of the Group’s
estate revenue (project engineers) . processes for determining
*Group estimates the percentage of
(3) determination of cost incurred on completion, and performed
the actual costs materials, labor and tests of the relevant controls.
incurred as cost of overhead which have (3) for the cost of sales, we
sales not yet been billed by obtained an understanding of
the contractor the Group’s cost
(4) recognition of cost *Group identifies accumulation process and
obtain to a contract sales commission performed tests of the
after contract relevant controls.
inception as the cost (4)For the recognition of cost
of obtaining the to obtain a contracts, we
contract agreed the basis for
calculating the sales
commission capitalized and
the portion recognized in
profit or loss