Audit Engagement Letter & Management Representation Letter(example)

Honrado, Jarlego, Javier, Latayan, People Support Center, Ayala corner Sen. Gil Puyat Avenue, Makati City, Phils. 02-545-2681 www.hjlassociatescpa.net

November 30, 2011

Mr. Jeronimo U. Kilayko, CEO United Coconut Planters Bank Head Office 7907 Makati Ave. Makati City, Philippines

Dear Mr. Kilayko:  You have requested that we audit the balance sheet of United Coconut Plant Planter ers s Bank Bank as of Dece Decemb mber er 31 20 2011 11,, and and the the rela relate ted d stat statem emen ents ts of  income, cash flows and changes in stockholders’ equity for the year then ending. We are pleased pleased to confirm our acceptance and our understanding understanding of  this engagemen engagementt by means of this letter. letter. Our audit will will be made with the objective of our expressing an opinion on the financial statements. We will will cond conduc uctt our our audit audit in acco accord rdanc ance e with with Ph Phil ilip ippi pine ne Stan Standar dards ds on Auditing. Those Standards require require that we plan and perform the audit and to obta obtain in reas reason onab able le assu assura ranc nce e that that the the fina financ ncia iall stat statem emen ents ts are are free free of  materi material al misst misstate ateme ments nts.. Our audit includ includes es examin examining ing,, on a test test basis, basis, evide videnc nce e su supp ppor ortting ing the the amou amount nts s and and discl isclos osur ures es in the the fina financ nciial statements. Our audit also includes includes assessing the accounting accounting principles used and significant estimates made by management, as well as evaluating the overall financial statements presentation. Beca Becaus use e of the the test test natur nature e and and othe otherr inhe inhere rent nt limi limita tati tion ons s of an audit audit,, togeth together er with with the inher inherent ent limit limitati ations ons of any accoun accountin ting g intern internal al contro controll system, there is an unavoidable risk that even some material misstatements may remain undiscovered. In addition to our report on the financial statements, we expect to provide you with a separate letter concerning any material weaknesses in accounting and internal control systems which come to our knowledge. We remi remind nd you you that that the the resp respon onsi sibi bili lity ty for for the the prep prepar arat atio ion n of fina financ ncia iall statement statements s including including adequate disclosure disclosure is that of the management management of the company. company. This includes includes the maintenan maintenance ce of adequate adequate accounting accounting records records and internal controls, the selection and application of accounting policies, and the safegua safeguardi rding ng of the assets assets of the company company.. As part of our audit audit process, we will request from management written confirmation concerning representations made to us in connection with the audit.

(FOR ACADEMIC USE ONLY)

However, as part of our responsibility as an accredited external auditor of  the Securities and Exchange Commission, we shall report to the Commission any of the following cases which may have been discovered based on generally accepted auditing standards, if the company fails to disclose the same to the Commission under its current reports:

(FOR ACADEMIC USE ONLY)

(FOR ACADEMIC USE ONLY)

Honrado, Jarlego, Javier, Latayan, People Support Center, Ayala corner Sen. Gil Puyat Avenue, Makati City, Phils. 02-545-2681

1. Any material findings involving fraud or error which will reduce the consolidated total assets of the company by five percent (5%). 2. Losses or potential losses the aggregate of which amounts to at least ten percent (10%) of the consolidated total assets of the company; 3. Any findings to the effect that the consolidated assets of the company, on a going concern basis are no longer adequate to cover the total claims of creditors. We look forward to full cooperation with your staff. Also, we trust that they will make available to us whatever records, documentation and other information requested in connection with our audit. Our fees, which will be billed as work progresses, are based on the time required by the individuals assigned to the engagement plus out-of-pocket expenses. Individual hourly rates vary according to the degree of responsibility involved and the experience and skill required.  This letter will be effective for three (3) years unless it is terminated, amended or superseded. Please sign and return the attached copy of this letter to indicate that it is in accordance with your understanding of the arrangements for our audit of  your financial statements.

Very truly yours, Honrado, Jarlego, Javier, Latayan, Lumbres, CPAs

EMIL KENNEDY F. JARLEGO, CPA Managing Partner

Accepted and agreed to by:

 JERONIMO U. KILAYKO Chief Executive Officer United Coconut Planters Bank Head Office

(FOR ACADEMIC USE ONLY) (FOR ACADEMIC USE ONLY)

7907 Makati Avenue Makati City, Philippines Phone: 632 811-9000 Fax: 632 814-2930 www.ucpb.com

 January 20, 2012

HONRADO, JARLEGO, JAVIER, LATAYAN, LUMBRES, CPAS

We are providing this letter in connection with your audit of the balance sheet of United Coconut Planters Bank as of December 31 2011, and the related statements of income, cash flows and changes in stockholders’ equity for the year then ending for the purpose of expressing an opinion as to whether the financial statements present fairly, in all material respects, the financial position, results of operations, and cash flows of United Coconut Planters Bank in conformity with generally accepted accounting principles. We confirm that we are responsible for the fair presentation in the statements of financial position, results of operations, and cash flows in conformity with generally accepted accounting principles. Certain representations in this letter are described as being limited to matters that are material. Items are considered material, regardless of size, if they involve an omission or misstatement of accounting information that, in the light of surrounding circumstances, makes it probable that the  judgment of a reasonable person relying on the information would be changed or influenced by the omission or misstatement. We confirm, to the best of our knowledge and belief, as of December 31 2011 the following representations made to you during your audit. 1. The financial statements referred to above are fairly presented in conformity with generally accepted accounting principles. 2. We have made available to you all— a. Financial records and related data b. Minutes of the meetings of stockholders, directors, and committees of directors, or summaries of actions of recent meetings for which minutes have not yet been prepared. 3. There have been no communications from regulatory agencies concerning noncompliance with or deficiencies in financial reporting practices. 4. There are no material transactions that have not been properly recorded in the accounting records underlying the financial statements. 5. There has been no— a. Fraud involving management or employees who have significant roles in internal control.

(FOR ACADEMIC USE ONLY)

b. Fraud involving others that could have a material effect on the financial statements. 6. The company has no plans or intentions that may materially affect the carrying value or classification of assets and liabilities. 7. The following have been properly recorded or disclosed in the financial statements: (FOR ACADEMIC USE ONLY) a. Related-party transactions, including sales, purchases, loans, transfers, leasing arrangements, and guarantees, and amounts receivable from or payable to related parties. b. Guarantees, whether written or oral, under which the company is contingently liable. c. Significant estimates and material concentrations known to management that are required to be disclosed in accordance with the PICPA’s Statement of Position 94-6, ‘‘Disclosure of Significant Risks and Uncertainties.’’ 8. There are no— a. Violations or possible violations of laws or regulations whose effects should be considered for disclosure in the financial statements or as a basis for recording a loss contingency. b. Unasserted claims or assessments that our lawyer has advised us are probable of assertion and must be disclosed in accordance with Financial Accounting Standards Board (FASB) Statement No. 5, ‘‘Accounting for Contingencies.’’ c. Other liabilities or gain or loss contingencies that are required to be accrued or disclosed by FASB Statement No. 5. 9. The company has satisfactory title to all owned assets, and there are no liens or encumbrances on such assets nor has any asset been pledged as collateral. 10. The company has complied with all aspects of contractual agreements that would have a material effect on the financial statements in the event of  noncompliance.  To the best of our knowledge and belief, no events have occurred subsequent to the balance-sheet date and through the date of this letter that would require adjustment to or disclosure in the aforementioned financial statements.

Very truly yours,

 JERONIMO U. KILAYKO Director, President and CEO United Coconut Planters Bank Head Office

(FOR ACADEMIC USE ONLY)

CESAR A. RUBIO Chief Financial Officer United Coconut Planters Bank Head Office

(FOR ACADEMIC USE ONLY)