I.

Introduction

Goldilocks Bakeshop, a popular and iconic name in the Filipino food business, was
founded in 1966 by sisters Milagros Leelin Yee and Clarita Leelin Go, as well as their
sister-in-law, Doris Wilson Leelin. The trio's ambition was to open a bakeshop that not only
served exquisite and high-quality cakes and pastries, but also gave its clients a sense of
belonging and tradition. Goldilocks began as a tiny bakery in Makati, Philippines, and has since
evolved to become a household name and icon of Filipino culinary history.

Goldilocks is privately held by the Leelin family, whose love of baking and dedication to
quality have remained at the heart of the company. The name "Goldilocks" was chosen to
express feelings of warmth and familiarity, inspired by the popular fairy tale character known for
her discriminating taste. This moniker accurately describes the bakery's commitment to
providing the ideal mix of taste and quality in its goods. Since its establishment, Goldilocks has
expanded its product offerings beyond cakes and pastries to include a variety of Filipino
delicacies, breads, and ready-made meals. The brand is well known for its iconic products,
including the Mocha Roll, Polvoron, and the legendary Butter Macaroons, which have become
staples in Filipino homes and festivities.

Goldilocks' success is due to its persistent commitment to quality, consistency, and

innovation. The bakeshop uses only the best ingredients and traditional baking processes to
ensure that each product fulfills the high standards established by the founders. Goldilocks has
also embraced current technology and trends, constantly upgrading its menu to meet its
consumers' changing tastes and preferences.In addition to home success, Goldilocks has had a
large international impact. The first worldwide branch was established in the United States in
1976, catering to the Filipino diaspora and exposing Filipino cuisine to a global audience.
Goldilocks now has multiple locations in North America, Canada, and Asia, cementing its status
as a global ambassador of Filipino cuisine.

The corporation also places a high value on corporate social responsibility, actively
participating in a variety of community initiatives and charitable events. Goldilocks' activities
strive to give back to the community by supporting causes that share its ideals, such as
education, health, and environmental sustainability.Goldilocks, with over five decades of
expertise, remains a renowned brand, synonymous with Filipino culture and culinary excellence.
Its dedication to quality, creativity, and community involvement guarantees that it remains a
beloved element of Filipino culture and a source of pride for Filipinos around the world.

II. Synthesis

Introduction to PFRS 15

The Philippine Financial Reporting Standard (PFRS) 15 - Revenue from Contracts with
Customers is a comprehensive framework that governs how businesses report revenue. This
standard, which is consistent with the International Financial Reporting Standard (IFRS) 15,
requires businesses to adopt a five-step methodology to assure uniformity, transparency, and
comparability in revenue reporting. The approach consists of identifying contracts with
consumers, identifying performance requirements, determining transaction prices, allocating
those prices to performance responsibilities, and recognizing revenue when (or as) performance
obligations are met.

Goldilocks Bakeshop, a major participant in the food business, follows PFRS 15 to

protect the integrity of its financial reporting, ensuring that its revenue recognition methods are
transparent, consistent, and in accordance with worldwide standards.

Step 1: Identifying Contracts with Customers

Goldilocks works with consumers on a variety of contracts, from individual retail

transactions to bulk sales for corporate events and gatherings. Each contract, whether explicit
or implicit, is assessed to ensure that it fits the standards established in PFRS 15. These factors
include both parties' permission and commitment, the identification of rights in the commodities
or services to be transferred, and payment arrangements.

Contracts in retail transactions are frequently implicit, made at the moment of sale when
buyers purchase things. Goldilocks guarantees that formal agreements are written for larger
purchases and corporate contracts, including the scope of goods or services, delivery timelines,
and payment terms. This precise documentation aids in correctly recognizing and maintaining
each contract.
 Step 2: Identifying Performance Obligations

Goldilocks' contracts typically require the delivery of baked products, pastries, and
catering services. Each product or service promised to the customer is considered a separate
performance obligation if it can be used independently or in conjunction with other readily
available resources.

For example, a buyer may buy a cake, a dozen pastries, and event catering services all
in one transaction. Goldilocks classifies each of these items as separate performance
responsibilities, acknowledging that the cake, pastries, and catering services are unique and
may be fulfilled independently.

Step 3: Determining the Transaction Price

The transaction price is the amount of money Goldilocks expects to get in exchange for
delivering promised goods or services to a client. This comprises fixed and variable quantities,
as well as any non-cash considerations.

For retail sales, the transaction price is usually straightforward, with fixed costs for
specific items. However, for larger or more sophisticated contracts, such as corporate catering
or bulk orders, Goldilocks may come across variable concerns like as discounts, rebates, and
incentives. The corporation estimates variable considerations using either the expected value
approach or the most likely amount method, whichever best anticipates the amount of
consideration to which it is entitled.

Step 4: Allocating the Transaction Price to Performance Obligations

Once the transaction price has been determined, Goldilocks assigns it to each
performance obligation based on their respective standalone selling values. The solo selling
price is the amount that Goldilocks would charge a consumer for a guaranteed good or service.

For example, if a customer placed a bulk order for cakes, pastries, and catering services,
Goldilocks calculates the individual selling pricing for each of these items. The total transaction
price is then distributed proportionally based on these prices. This guarantees that revenue is
recognized correctly for each performance obligation, reflecting the value provided to the
customer.

Step 5: Recognizing Revenue When (or as) Performance Obligations Are Satisfied

Revenue is generated when Goldilocks fulfills a performance commitment by delivering a

promised good or service to a customer. The transfer is regarded complete when the consumer
gains possession of the product or service, which might happen over time or at a precise point
in time.

Revenue for retail transactions is recognized at the point of sale, when the customer
takes possession of the products. Revenue for catering services and larger orders is recognized
over time, either as the service is delivered or as the customer receives the goods, depending
on the contract terms.

Goldilocks employs the output approach to track progress toward full satisfaction of
performance obligations for services provided over time, such as catering. This strategy relies
on direct measurements of the value transmitted to the consumer, such as the percentage of the
event catered.

Implementation Challenges and Solutions

Goldilocks had various obstacles when implementing PFRS 15, particularly in changing
its accounting systems and processes to comply with the new standard. The company spent in
training for its accounting and finance departments to ensure that they fully understand the
standard and its obligations.

One key problem was navigating changeable concerns in complex contracts. To

overcome this, Goldilocks created robust estimation methodologies and tools for correctly
tracking and updating variable considerations. This technique ensures that revenue recognition
is precise and accurately reflects the actual value provided to customers.

Furthermore, Goldilocks had to review its contracts and performance requirements. To

ensure PFRS 15 compliance, the company reviewed all of its contracts, identifying and
documenting each performance obligation. This thorough methodology helps to ensure the
integrity and trustworthiness of its financial reporting.

Benefits of Adherence to PFRS 15

Goldilocks has gained various benefits from adhering to PFRS 15, including increased
transparency and comparability in its financial reporting. The standardized revenue recognition
process improves the trustworthiness of financial data, giving stakeholders a clear and
consistent picture of the company's financial status.

Furthermore, PFRS 15's emphasis on precise documentation and transparent contract

management has resulted in improved internal controls and more effective contract
management operations. Goldilocks' commitment to compliance reflects its dedication to
upholding high levels of financial integrity and accountability.

III. Conclusion

Goldilocks Bakeshop's use of PFRS 15 - Revenue from Contracts with Customers

demonstrates its commitment to maintaining the highest levels of financial reporting and
transparency. By methodically following the five-step process, Goldilocks guarantees that its
revenue recognition practices are uniform, transparent, and in accordance with worldwide
standards. This dedication not only improves the company's financial integrity, but it also
strengthens its reputation as a trustworthy and dependable player in the food market. Goldilocks
remains well-positioned for long-term growth and success in an ever-changing market thanks to
constant improvement and adherence to regulatory standards.

IV. Recommendation

I strongly urge conducting an academic investigation on Goldilocks Bakeshop's

conformity to PFRS 15 - Revenue from Contracts with Customers. This case study offers vital
insights into the application of difficult accounting standards in a real-world business setting.

Goldilocks, a well-known entity in the Filipino food industry since 1966, exemplifies the
PFRS 15 five-step model: identifying contracts, pinpointing performance obligations,
determining transaction prices, allocating these prices, and recognizing revenue when
obligations are met. This thorough method guarantees that revenue recognition is visible,
uniform, and compliant, while also providing students with a realistic framework for
understanding the complexities of current financial reporting.

Goldilocks' difficulties and answers, such as handling variable concerns and updating
accounting systems, demonstrate the significance of strong financial processes and training.
This course will help students gain a better understanding of contract management,
performance requirements, and revenue recognition, all of which are important skills for future
accountants and financial professionals.

Examining Goldilocks' procedures will provide students with a thorough grasp of PFRS
15's impact on financial integrity and transparency, making it an excellent academic topic.
References

International Financial Reporting Standards (IFRS). (2024). PFRS 15: Revenue from
Contracts with Customers. Retrieved from
https://www.ifrs.org/issued-standards/list-of-standards/ifrs-15-revenue-from-contracts-wit
h-customers/

Goldilocks Bakeshop Inc. (n.d.). Our story. Retrieved from

https://www.goldilocks.com.ph/our-story