Via ODiSy March 22, 2012 PHILIPPINE STOCK EXCHANGE ... - BDO

- 33 -Most changes in deferred tax assets or liabilities are recognized as a component of taxexpense in the statement of income. Only changes in deferred tax assets or liabilitiesthat relate to a change in value of resources or liabilities relate to items recognized inother comprehensive income or directly in equity are recognized in othercomprehensive income or directly in equity.2.28 Earnings Per Share (EPS)Basic earnings per common share is determined by dividing net profit by the weightedaverage number of common shares subscribed and issued during the period, afterretroactive adjustment for any stock dividend declared in the current period.The diluted earnings per common share is also computed by dividing net profit by theweighted average number of common shares subscribed and issued during the period.However, net profit attributable to common shares and the weighted average numberof common shares outstanding are adjusted to reflect the effects of potentially dilutiveconvertible preferred shares and stock option plan granted by BDO Unibank Group tothe qualified officers. Convertible preferred shares are deemed to have been convertedto common shares at the issuance of preferred shares. The stock option plan is deemedto have been converted into common stock in the year the stock option is granted.2.29 Trust ActivitiesBDO Unibank Group commonly acts as trustee and in other fiduciary capacities thatresult in the holding or placing of assets on behalf of individuals, trusts, retirementbenefit plans and other institutions. Assets and income arising thereon are excludedfrom these financial statements, as these are neither assets nor income of BDOUnibank Group.2.30 Event After the Reporting PeriodAny post-year-end event that provides additional information about BDO UnibankGroup’s position at the end of reporting period (adjusting event) is reflected in thefinancial statements. Post-year-end events that are not adjusting events, if any, aredisclosed when material to the financial statements.3. SIGNIFICANT ACCOUNTING JUDGMENTS AND ESTIMATESBDO Unibank Group’s financial statements prepared in accordance with FRSP forbanks require management to make judgments and estimates that affect the amountsreported in the financial statements and related notes. Judgments and estimates arecontinually evaluated and are based on historical experience and other factors, includingexpectations of future events that are believed to be reasonable under thecircumstances. Actual results may ultimately differ from these estimates and thedifferences could be significant.