What are holding companies? Understanding Parent and Subsidiary corporate relationship

 source: http://philippines.starbucks.com

Have you ever thought who owns the Starbucks franchise in the Philippines?

Rustan Coffee which is a subsidiary of Rustan Group owns Starbucks Philippines(need clarification here) which  is the franchisee of Starbucks in the Philippines.

If you look at the relationship between these companies one can clearly see which stands as the parent and which stands as the subsidiary. By definition a subsidiary is a corporation which is controlled by another company while a parent company is a corporation who has control over another company. 

The important term to remember is "control". What is control then?

Basically control is defined as having an influence over another. So in a corporate setting control is achieved if one company owns a majority share in a company thus giving such company the power to make decisions due to the majority voting rights.

The Philippine Stock Exchange have an index named Holding Firms. This index primarily have all the conglomerate that has shareholdings in businesses of various industry. 

To name a few the likes of JGS(JG Summit) of the Gokingwei's, AC(Ayala Corp.) of the Ayala's, SM(SM Investments) of the Sy's, LPZ(Lopez Group) of the Lopez's, and MPI(Metro Pacific Investments) of Manny V. Pangilinan of First Pacific are the known holding firms in the Philippines.

It is possible that a Parent/Holding Company is also a subsidiary of another company. In this case such company will be called the ultimate  parent company.  An ultimate parent company may be a domestic corporation or a foreign corporation. 

In that case the Parent corporation prepares its Financial report with two presentation that is as the corporation by itself and as consolidated report.(This topic will be discuss in another post).

Now why does one need to know such?

This is important because it gives an idea how a stock will be performing. So basically since the earnings of a parent company comes from its subsidiary one can gauge the value of a holding company through its subsidiary. 

An example is AC(Ayala Corp) with the good performance of BPI(Bank of the Philippine  Island) one might think that it is good to buy AC(which is good because AC is considered as a fundamentally sound corporation) but looking at its telecom business GLO(Globe Inc.) which has suffered set back in its operations due to the sluggish telecom industry one might concentrate more on BPI rather than investing its bulk of funds in AC.

At the same time it is also noteworthy to know that though such is interconnected it seems that the subsidiary and the parent are independent from one another.

So one still has to understand the nature of the company and the industry they are in. And it would be of great help knowing the diversified business a company ventures into.

 

What are holding companies? Understanding Parent and Subsidiary corporate relationship

 source: http://philippines.starbucks.com

Have you ever thought who owns the Starbucks franchise in the Philippines?

Rustan Coffee which is a subsidiary of Rustan Group owns Starbucks Philippines(need clarification here) which  is the franchisee of Starbucks in the Philippines.

If you look at the relationship between these companies one can clearly see which stands as the parent and which stands as the subsidiary. By definition a subsidiary is a corporation which is controlled by another company while a parent company is a corporation who has control over another company. 

The important term to remember is "control". What is control then?

Basically control is defined as having an influence over another. So in a corporate setting control is achieved if one company owns a majority share in a company thus giving such company the power to make decisions due to the majority voting rights.

The Philippine Stock Exchange have an index named Holding Firms. This index primarily have all the conglomerate that has shareholdings in businesses of various industry. 

To name a few the likes of JGS(JG Summit) of the Gokingwei's, AC(Ayala Corp.) of the Ayala's, SM(SM Investments) of the Sy's, LPZ(Lopez Group) of the Lopez's, and MPI(Metro Pacific Investments) of Manny V. Pangilinan of First Pacific are the known holding firms in the Philippines.

It is possible that a Parent/Holding Company is also a subsidiary of another company. In this case such company will be called the ultimate  parent company.  An ultimate parent company may be a domestic corporation or a foreign corporation. 

In that case the Parent corporation prepares its Financial report with two presentation that is as the corporation by itself and as consolidated report.(This topic will be discuss in another post).

Now why does one need to know such?

This is important because it gives an idea how a stock will be performing. So basically since the earnings of a parent company comes from its subsidiary one can gauge the value of a holding company through its subsidiary. 

An example is AC(Ayala Corp) with the good performance of BPI(Bank of the Philippine  Island) one might think that it is good to buy AC(which is good because AC is considered as a fundamentally sound corporation) but looking at its telecom business GLO(Globe Inc.) which has suffered set back in its operations due to the sluggish telecom industry one might concentrate more on BPI rather than investing its bulk of funds in AC.

At the same time it is also noteworthy to know that though such is interconnected it seems that the subsidiary and the parent are independent from one another.

So one still has to understand the nature of the company and the industry they are in. And it would be of great help knowing the diversified business a company ventures into.

 

Listed Company Profile: Alliance Global Inc.

source: http://allianceglobalinc.com

Have you ever thought who is the maker of Emperador brandy, owner of Megaworld, master franchisor of McDonald's in the Philippines, and Travellers International Hotel Group, Inc.?

These are Alliance Global Inc.(AGI) core businesses.  Led by Andrew Tan, one of the Philippines leading tycoons, AGI group has grown and is continually making its presence in the Philippine market. 

Below is a excerpt from www.reuters.com/finance

Alliance Global Group, Inc. (AGI) is a holding company presently engaged in the food and beverage business (manufacturing and trading of consumer products), real estate (investment in and development of real estate, lease of properties, hotel operations and tourism-oriented businesses), and quick service restaurant (McDonald’s). 

The Company’s operating businesses are categorized into three segments: Food and Beverage (F&B); Real Estate (RE) and Quick Service Restaurant (QSR). Its subsidiaries include First Oceanic Property Management, Inc, Citylink Coach Services, Inc., Emperador Distillers, Inc., Anglo Watsons Glass, Inc., Golden Arches Development Corporation, Golden Arches Realty Corporation, Alliance Global Brands, Inc. and Emperador International Ltd.

AGI has been performing well from share price of Php 4.00 at the beginning of the year to Php 12.00 at present. Its performance can be seen in this one year candlestick chart

Below is an excerpt from AGI's 17Q report filed with the Philippine SEC

Key Performance Indicators

Presented below are the top five (5) key performance indicators of the Company and subsidiaries as of and for the nine months ended September 30: 2010 2009

o Revenues growth – measures the percentage change in revenues 

   over a designated period of time. Performance is measured both in

   terms of amount and volume, where applicable.
o Net income growth – measures the percentage change in net 

   income over a designated period of time
o Net income rate– computed as percentage of net income to

  revenues-measures the operating efficiency and success of 

  maintaining satisfactory control of costs
o Return on investment [or capital employed] – the ratio of net 

   income to total assets - measures the degree of efficiency in the 

   use of resources to generate net income
o Current ratio – computed as current assets divided by current 

   liabilities – measures the ability of the business to meet its current 

   obligations. To measure immediate liquidity, quick assets [cash, 

   marketable securities, accounts receivables] is divided by current 

   liabilities.

source: http://www.pse.com.ph/html/ListedCompanies/pdf/2010/AGI_17Q_Sep2010.pdf

Listed Company Profile: Alliance Global Inc.

source: http://allianceglobalinc.com

Have you ever thought who is the maker of Emperador brandy, owner of Megaworld, master franchisor of McDonald's in the Philippines, and Travellers International Hotel Group, Inc.?

These are Alliance Global Inc.(AGI) core businesses.  Led by Andrew Tan, one of the Philippines leading tycoons, AGI group has grown and is continually making its presence in the Philippine market. 

Below is a excerpt from www.reuters.com/finance

Alliance Global Group, Inc. (AGI) is a holding company presently engaged in the food and beverage business (manufacturing and trading of consumer products), real estate (investment in and development of real estate, lease of properties, hotel operations and tourism-oriented businesses), and quick service restaurant (McDonald’s). 

The Company’s operating businesses are categorized into three segments: Food and Beverage (F&B); Real Estate (RE) and Quick Service Restaurant (QSR). Its subsidiaries include First Oceanic Property Management, Inc, Citylink Coach Services, Inc., Emperador Distillers, Inc., Anglo Watsons Glass, Inc., Golden Arches Development Corporation, Golden Arches Realty Corporation, Alliance Global Brands, Inc. and Emperador International Ltd.

AGI has been performing well from share price of Php 4.00 at the beginning of the year to Php 12.00 at present. Its performance can be seen in this one year candlestick chart

Below is an excerpt from AGI's 17Q report filed with the Philippine SEC

Key Performance Indicators

Presented below are the top five (5) key performance indicators of the Company and subsidiaries as of and for the nine months ended September 30: 2010 2009

o Revenues growth – measures the percentage change in revenues 

   over a designated period of time. Performance is measured both in

   terms of amount and volume, where applicable.
o Net income growth – measures the percentage change in net 

   income over a designated period of time
o Net income rate– computed as percentage of net income to

  revenues-measures the operating efficiency and success of 

  maintaining satisfactory control of costs
o Return on investment [or capital employed] – the ratio of net 

   income to total assets - measures the degree of efficiency in the 

   use of resources to generate net income
o Current ratio – computed as current assets divided by current 

   liabilities – measures the ability of the business to meet its current 

   obligations. To measure immediate liquidity, quick assets [cash, 

   marketable securities, accounts receivables] is divided by current 

   liabilities.

source: http://www.pse.com.ph/html/ListedCompanies/pdf/2010/AGI_17Q_Sep2010.pdf

Stock market news: IP CONVERGE DATA CENTER, INC.IPO

I got this message  again from my COL account 

Offer Price: P4.20/ share

Minimum Subscription: 1000 shares and thereafter, in multiples of 1000 shares

Offer Period: November 25 to November 30, 2010 - 12:00 Noon

 

COL End of Offer and Payment: November 30, 2010 

12:00 Noon

Tentative Listing Date: December 9, 2010 

Payment Terms: 100% due upon subscription not later

than November 30, 2010 12:00 Noon

INITIAL PUBLIC OFFERING FOR IP CONVERGE DATA 

CENTER, INC.

Please be informed that the Board of Directors of The Philippine Stock Exchange, Inc. approved on October 20, 2010, the application of IP CONVERGE DATA CENTER, INC. (CLOUD or the Company) for the initial listing of 181,866,669 common shares, with a par value of P1.00 per share under the Second Board of the Exchange consisting of the following:

a.136,400,002 common shares, representing the issued and outstanding shares of the Company prior to the Initial Public Offering (IPO) of the Companys shares; and
b.45,466,667 common shares, representing the common shares to be offered to the public on a primary basis.

THE OFFER

Offer Price : Php4.20 per share

Minimum   : 1000 shares, and thereafter in multiples of 

                     1000 shares

COL Offer Period : November 25 to November 30, 2010 

                 12:00 Noon

COL End of Offer and Payment   : November 30, 2010 

                 12:00 Noon

Tentative Listing Date  : December 9, 2010

Payment Terms  : Full payment on or before November

                 30, 2010

Important:

Due to the limited number of shares available,

subscriptions are not guaranteed which may force us 

to raffle minimum lots. We encourage clients to 

subscribe through the Local Small Investors (LSI)

Program, for details, click here.

For interested subscribers, please subscribe online by 

clicking here. Deadline for subscription requests and 

payment is on November 30, 2010 12:00 Noon.

NOTE: COL shall not process subscription requests for

accounts that fail to provide adequate funding given the

deadline of the payment on November 30, 2010.

Please be guided accordingly.

CitisecOnline Helpdesk

 
helpdesk@citiseconline.com

Stock market news: IP CONVERGE DATA CENTER, INC.IPO

I got this message  again from my COL account 

Offer Price: P4.20/ share

Minimum Subscription: 1000 shares and thereafter, in multiples of 1000 shares

Offer Period: November 25 to November 30, 2010 - 12:00 Noon

 

COL End of Offer and Payment: November 30, 2010 

12:00 Noon

Tentative Listing Date: December 9, 2010 

Payment Terms: 100% due upon subscription not later

than November 30, 2010 12:00 Noon

INITIAL PUBLIC OFFERING FOR IP CONVERGE DATA 

CENTER, INC.

Please be informed that the Board of Directors of The Philippine Stock Exchange, Inc. approved on October 20, 2010, the application of IP CONVERGE DATA CENTER, INC. (CLOUD or the Company) for the initial listing of 181,866,669 common shares, with a par value of P1.00 per share under the Second Board of the Exchange consisting of the following:

a.136,400,002 common shares, representing the issued and outstanding shares of the Company prior to the Initial Public Offering (IPO) of the Companys shares; and
b.45,466,667 common shares, representing the common shares to be offered to the public on a primary basis.

THE OFFER

Offer Price : Php4.20 per share

Minimum   : 1000 shares, and thereafter in multiples of 

                     1000 shares

COL Offer Period : November 25 to November 30, 2010 

                 12:00 Noon

COL End of Offer and Payment   : November 30, 2010 

                 12:00 Noon

Tentative Listing Date  : December 9, 2010

Payment Terms  : Full payment on or before November

                 30, 2010

Important:

Due to the limited number of shares available,

subscriptions are not guaranteed which may force us 

to raffle minimum lots. We encourage clients to 

subscribe through the Local Small Investors (LSI)

Program, for details, click here.

For interested subscribers, please subscribe online by 

clicking here. Deadline for subscription requests and 

payment is on November 30, 2010 12:00 Noon.

NOTE: COL shall not process subscription requests for

accounts that fail to provide adequate funding given the

deadline of the payment on November 30, 2010.

Please be guided accordingly.

CitisecOnline Helpdesk

 
helpdesk@citiseconline.com

Corporate News: Jollibee CFO: My job is to prepare the company for all kinds of shocks

source: www.inquirer

                                        

I got this news article from Philippine Daily Inquirer and it gives me a better perspective of JFC and its coming success for the next 2 -5 years. Equally important position in the company is the CFO which handles the financial capabilities of the company. The CFO must be able to foresee the needs of the company and be able to make actions to put the company on track to its goals.

Source: http://business.inquirer.net/money/topstories

Jollibee CFO: My job is to prepare the company for all kinds of shocks

By Doris Dumlao
Philippine Daily Inquirer
First Posted 17:29:00 11/20/2010

MANILA, Philippines—The son of an auto mechanic from a small town in Quezon who worked his way up to become chief finance officer of globally expanding Filipino fast-food giant Jollibee Foods Corp. has been named as the “CFO of the Year” for 2010.
 

Ysmael Baysa reminisces about his humble beginnings during the media briefing announcing him as this year’s recipient of the prestigious annual award jointly given by ING Bank Manila (ING) and the Financial Executives Institute of the Philippines. He shares the honor with his hometown of Sariaya and alma mater Luzonian University of Lucena City in Quezon province.

While most CFOs of top-tier companies are usually bred and schooled in Metro Manila or even abroad, Baysa takes pride in having been raised and educated in his province. “It’s because of this humble beginning that this award has meant so much more,” he says.

To read more about this news article click here.

 

Corporate News: Jollibee CFO: My job is to prepare the company for all kinds of shocks

source: www.inquirer

                                        

I got this news article from Philippine Daily Inquirer and it gives me a better perspective of JFC and its coming success for the next 2 -5 years. Equally important position in the company is the CFO which handles the financial capabilities of the company. The CFO must be able to foresee the needs of the company and be able to make actions to put the company on track to its goals.

Source: http://business.inquirer.net/money/topstories

Jollibee CFO: My job is to prepare the company for all kinds of shocks

By Doris Dumlao
Philippine Daily Inquirer
First Posted 17:29:00 11/20/2010

MANILA, Philippines—The son of an auto mechanic from a small town in Quezon who worked his way up to become chief finance officer of globally expanding Filipino fast-food giant Jollibee Foods Corp. has been named as the “CFO of the Year” for 2010.
 

Ysmael Baysa reminisces about his humble beginnings during the media briefing announcing him as this year’s recipient of the prestigious annual award jointly given by ING Bank Manila (ING) and the Financial Executives Institute of the Philippines. He shares the honor with his hometown of Sariaya and alma mater Luzonian University of Lucena City in Quezon province.

While most CFOs of top-tier companies are usually bred and schooled in Metro Manila or even abroad, Baysa takes pride in having been raised and educated in his province. “It’s because of this humble beginning that this award has meant so much more,” he says.

To read more about this news article click here.

 

What are holding companies?

Have you ever heard of SMC,

Investing word of the day: Leverage

 source: http://www.etftrends.com

Hi it's been quite awhile since I posted some investing words to think about.

So lets start with LEVERAGE.

Investopedia.com defines leverage as :

1. The use of various financial instruments or borrowed capital, such

    as margin, to increase the potential return of an investment.

2. The amount of debt used to finance a firm's assets. A firm with

    significantly more debt than equity is considered to be highly 

    leveraged.

Leverage is most commonly used in real estate transactions through the use of mortgages to purchase a home. 

So basically what does this word mean to us? 

Well leverage is taking advantage of available means to increase profit. To make it simple let's use OPM(Other People's Money). 

For example since Christmas season is around let say you wanted to sell those beautiful parols but right now you don't have enough capital to buy such. So you decided to find the manufacturer to make sure you get it at the cheapest price. So you went to Pampanga and was able to find the manufacturer. 

But even though its cheap at the manufacturer you still don't have enough capital of your own so you ask your brothers and sisters to lend you money. And so you got the money and got the parols. Displayed the parols in your house which is along the busiest road in your subdivision and by week's end you sold all the parols.

So where is leverage there? That is where OPM(Other People's Money) come. Well you were able to make profit even without you shelling out cash to finance your purchase.

By that you were able to increase you earnings by 100% if you fully financed it with borrowed money.


The same principle is used in Larry Gamboa's book Think Rich Pinoy(an adaptation to Robert Kiyosaki's principles in the Philippine setting).

                            source:http://thinkrichpinoy.com

source: http://fireballbooks.com/ThinkRichPinoy/

Larry and his partners scout banks for foreclosed properties that are auctioned at insanely low price. With a required deposit of only Php 25,000.00( this is the minimum I think) they were able to join the auction of foreclosed properties and the bank will even let you pay the property at installment basis.

So Larry Gamboa and company are able to leverage on their buy and sell project because it seems that they didn't even empty their pockets to fund the project because they borrowed the fund they need to the same bank who  sold the property. 

That is what we call leverage or in our Pinoy lingo OPM ;)   or better yet DOING MORE WITH LESS

source: http://www.healthy-holistic-living.com

Investing word of the day: Leverage

 source: http://www.etftrends.com

Hi it's been quite awhile since I posted some investing words to think about.

So lets start with LEVERAGE.

Investopedia.com defines leverage as :

1. The use of various financial instruments or borrowed capital, such

    as margin, to increase the potential return of an investment.

2. The amount of debt used to finance a firm's assets. A firm with

    significantly more debt than equity is considered to be highly 

    leveraged.

Leverage is most commonly used in real estate transactions through the use of mortgages to purchase a home. 

So basically what does this word mean to us? 

Well leverage is taking advantage of available means to increase profit. To make it simple let's use OPM(Other People's Money). 

For example since Christmas season is around let say you wanted to sell those beautiful parols but right now you don't have enough capital to buy such. So you decided to find the manufacturer to make sure you get it at the cheapest price. So you went to Pampanga and was able to find the manufacturer. 

But even though its cheap at the manufacturer you still don't have enough capital of your own so you ask your brothers and sisters to lend you money. And so you got the money and got the parols. Displayed the parols in your house which is along the busiest road in your subdivision and by week's end you sold all the parols.

So where is leverage there? That is where OPM(Other People's Money) come. Well you were able to make profit even without you shelling out cash to finance your purchase.

By that you were able to increase you earnings by 100% if you fully financed it with borrowed money.


The same principle is used in Larry Gamboa's book Think Rich Pinoy(an adaptation to Robert Kiyosaki's principles in the Philippine setting).

                            source:http://thinkrichpinoy.com

source: http://fireballbooks.com/ThinkRichPinoy/

Larry and his partners scout banks for foreclosed properties that are auctioned at insanely low price. With a required deposit of only Php 25,000.00( this is the minimum I think) they were able to join the auction of foreclosed properties and the bank will even let you pay the property at installment basis.

So Larry Gamboa and company are able to leverage on their buy and sell project because it seems that they didn't even empty their pockets to fund the project because they borrowed the fund they need to the same bank who  sold the property. 

That is what we call leverage or in our Pinoy lingo OPM ;)   or better yet DOING MORE WITH LESS

source: http://www.healthy-holistic-living.com

Ways to be debt free: What now?

                                                       source: http://7million7years.com

Its been awhile since I wrote something about this topic. If you haven't read the first part click here.

In my last post we talked about accepting that you are in fact buried in debt. It may sound crazy or something but as any other form of addiction acknowledging your situation is the very first step. Now the next thing one should do is to make an inventory of whatever one has. 

When I say "whatever one has" that includes your assets and your liabilities.

Do you have a car? Do you have a house or a laptop? These things are your assets. Assets are things of value that you own. 

Do you have a credit card loan, a bank loan, a mortgage, or a "utang sa 5/6" ? These things are liabilities. Liabilities are things that you owe.

List these things separately. You could have a notebook with the pages equally divided of which the first half would be your ASSETS and the second your LIABILITIES. Make it a four column page. The first would be your description or name of the asset or liability, the second is the amount related to it, the third is your plan for it, ans the last is where you can either put a tick mark to indicate if the plan for it is done or a date of which you want to achieve such. See  sample below:

Now just like the above examples you have to decide which assets of yours can go away and which one are necessity. I know this would be gory but hey remember you are buried in debt and if you don't get out of it fast the more you will be buried in the pit. Oh these is one of the secrets ... you must get out of debt fast.

On your liability section determined which one are onerous or burdensome.

Lets define onerous, courtesy of wiktionary.org

Etymology

From Latin onerosus (“burdensome”), from onus (“load”).
Pronunciation

    * (UK) IPA: /ˈəʊn.ɜː(ɹ).ʌs/ SAMPA: /"@Un.3:(r).Vs/

Adjective

onerous (comparative more onerous, superlative most onerous)

   1. burdensome; difficult; wearing; tiring

Antonyms

    * gratuitous

Related terms

    * exonerate
    * exoneration
    * onus

Why list liability in the order of burdensomeness? 

As I have said awhile ago the faster you pay your debt the better. So the faster you pay debts or loans with hefty interest the better because you save money paying the interest attached to it. So looking back at the above I guess the Php 650,000.00 bank loan at 15% per annum should be settled or paid first to avoid paying interest.

Now looking at your assets, list them down in the order of greater fair value. Sorry I never told you. Maybe your laptop cost 25,000.00 when you bought it 3 months ago but if you are to sell it  now probably you will only get 10,000.00 to 15,000.00. One has to consider an asset's fair value. 

Wikipedia has this to say about fair value:

A rational and unbiased estimate of the potential market price of a good, service, or asset, taking into account such objective factors as:

    * acquisition/production/distribution costs, replacement
      costs, or costs of close substitutes
    * actual utility at a given level of development of social
      productive capability
    * supply vs. demand

and subjective factors such as

    * risk characteristics
    * cost of and return on capital
    * individually perceived utility

What does this mean? Your assets may have a lower or higher value depending on how much is the accepted fair value at the time of sale. So what can you do to be able to sell your stuff to pay off your debts? I guess these are my only advice in regards to this matter ; first make sure people who are interested to buy see value in your asset and second make sure such are in good shape.

Looking at the two sides you might notice that you have a difference of negative Php 197,500.00

This is what we call Net Worth. To read about my post regarding Net Worth click here.

Having a negative net worth signifies that you are really buried in debt while having a break even or a positive net worth means you are able to leverage your assets and liability to the full potential. 

So what is one of the things that you should do to be debt free? 

You have to list your asset in the order of greater fair value and liabilities in the order of onerousness. Pay first your onerous debts and make sure your assets has greater value so that you can get as much from it.

Ways to be debt free: What now?

                                                       source: http://7million7years.com

Its been awhile since I wrote something about this topic. If you haven't read the first part click here.

In my last post we talked about accepting that you are in fact buried in debt. It may sound crazy or something but as any other form of addiction acknowledging your situation is the very first step. Now the next thing one should do is to make an inventory of whatever one has. 

When I say "whatever one has" that includes your assets and your liabilities.

Do you have a car? Do you have a house or a laptop? These things are your assets. Assets are things of value that you own. 

Do you have a credit card loan, a bank loan, a mortgage, or a "utang sa 5/6" ? These things are liabilities. Liabilities are things that you owe.

List these things separately. You could have a notebook with the pages equally divided of which the first half would be your ASSETS and the second your LIABILITIES. Make it a four column page. The first would be your description or name of the asset or liability, the second is the amount related to it, the third is your plan for it, ans the last is where you can either put a tick mark to indicate if the plan for it is done or a date of which you want to achieve such. See  sample below:

Now just like the above examples you have to decide which assets of yours can go away and which one are necessity. I know this would be gory but hey remember you are buried in debt and if you don't get out of it fast the more you will be buried in the pit. Oh these is one of the secrets ... you must get out of debt fast.

On your liability section determined which one are onerous or burdensome.

Lets define onerous, courtesy of wiktionary.org

Etymology

From Latin onerosus (“burdensome”), from onus (“load”).
Pronunciation

    * (UK) IPA: /ˈəʊn.ɜː(ɹ).ʌs/ SAMPA: /"@Un.3:(r).Vs/

Adjective

onerous (comparative more onerous, superlative most onerous)

   1. burdensome; difficult; wearing; tiring

Antonyms

    * gratuitous

Related terms

    * exonerate
    * exoneration
    * onus

Why list liability in the order of burdensomeness? 

As I have said awhile ago the faster you pay your debt the better. So the faster you pay debts or loans with hefty interest the better because you save money paying the interest attached to it. So looking back at the above I guess the Php 650,000.00 bank loan at 15% per annum should be settled or paid first to avoid paying interest.

Now looking at your assets, list them down in the order of greater fair value. Sorry I never told you. Maybe your laptop cost 25,000.00 when you bought it 3 months ago but if you are to sell it  now probably you will only get 10,000.00 to 15,000.00. One has to consider an asset's fair value. 

Wikipedia has this to say about fair value:

A rational and unbiased estimate of the potential market price of a good, service, or asset, taking into account such objective factors as:

    * acquisition/production/distribution costs, replacement
      costs, or costs of close substitutes
    * actual utility at a given level of development of social
      productive capability
    * supply vs. demand

and subjective factors such as

    * risk characteristics
    * cost of and return on capital
    * individually perceived utility

What does this mean? Your assets may have a lower or higher value depending on how much is the accepted fair value at the time of sale. So what can you do to be able to sell your stuff to pay off your debts? I guess these are my only advice in regards to this matter ; first make sure people who are interested to buy see value in your asset and second make sure such are in good shape.

Looking at the two sides you might notice that you have a difference of negative Php 197,500.00

This is what we call Net Worth. To read about my post regarding Net Worth click here.

Having a negative net worth signifies that you are really buried in debt while having a break even or a positive net worth means you are able to leverage your assets and liability to the full potential. 

So what is one of the things that you should do to be debt free? 

You have to list your asset in the order of greater fair value and liabilities in the order of onerousness. Pay first your onerous debts and make sure your assets has greater value so that you can get as much from it.