BIR Ruling [DA-358-98]

August 04, 1998 BIR RULING [DA-358-98] Joaquin Cunanan & Co. 14th Floor, Multinational Bancorporation Centre 6805 Ayala Avenue Makati City Attention: Mr . George J . Lavadia Principal Tax and Corporate Services Gentlemen : This refers to your letter dated March 27, 1998 requesting in behalf of Columbian Carbon Philippines, Inc. authority to change its accounting method on inventory costing from first-in, first-out (FIFO) to weighted average method effective January 1, 1998. cdt It is represented that Columbian Carbon Philippines, Inc. is a domestic corporation duly registered with the Securities and Exchange Commission with its principal office located at 7/F Royal Match Building 6780 Ayala Avenue, Makati City, engaged in the manufacture of carbon black, of which oil and gas are among the major components or raw materials used; that for 1998, it has adopted a new computerized accounting system; that with such change, the FIFO is no longer compatible; and that it now chose to use the weighted average method of inventory costing, which method is compatible to the new computerized accounting system the corporation has used. In reply, please be informed that for purposes of synchronization with the change of the computerized accounting system the corporation has adopted, and since the FIFO method of inventory costing is no longer compatible with the said computerized accounting system, this office hereby grants authority to CCPI the use of the weighted average method of their inventory costing, pursuant to Section 235 of the Tax Code of 1997. This ruling is issued on the basis of the foregoing representations. However, if upon investigation, it will be disclosed that the facts are different from that as represented, then this ruling shall be considered null and void. LexLib Very truly yours, (SGD.) SIXTO S. ESQUIVIAS IV Deputy Commissioner (Legal & Enforcement Group)