Accountancy Act of 2004 Revised

Philippine Accountancy Act of 2004
REVDEVT
by:
Francisco H. Villamin, Jr.
June , 2013

1
Republic Act 9298 is known as Philippine Accountancy

Act of 2004
Repealed PD 692 known as Revised Accountancy Law
Objectives:
The standardization and regulation of accounting

education.
The examination for registration of certified public

accountants.
The supervision, control and regulation of the practice

of accountancy in the Philippines.

2
Practice of Public Accountancy:

- One who in his individual capacity, or as a partner or a staff member
in an accounting or auditing firm
- Holding himself/herself as one skilled in the knowledge, science and
practice of accounting, and as a qualified person to render
professional services as a CPA, or offering or rendering, or both, to
more than one client on a fee basis, or otherwise, services such as:
1)
2)
3)
4)
audit or verification of financial transactions and accounting records

preparation, signing or certification for client of reports of audit
design, installation, review and revision of accounting system
represent s his/her client before government agencies on matters related
to accounting
5) rendition of professional assistance relating to accounting procedures
and the recording and presentation of financial facts or data.
3
Practice in Commerce and Industry:

-
One who is involved in decision making requiring professional knowledge

in the science of accounting, as well as the accounting aspects of finance
or taxation
One who represents his/her employer before government agencies on tax

and other matters related to accounting
One when such employment or position requires the holder to be a CPA

involved in supervision of recording of financial transactions,
preparation of financial statements, coordination with external
auditors for f/s audit provided that the business or company
where such position exists has paid up capital of at least P5M &/or
annual revenue of at least P10M provided that it shall apply to
persons
to be employed after the effectivity of IRR & provided finally, it shall
not deprive employment of incumbents to this position.

4
Practice in Education/Academe:
- One who is in an educational institution which involve teaching of accounting,
auditing, management advisory services, accounting aspect of finance, business
law and taxation, and other related subjects
Provided that members of the Integrated Bar of the Phils. (IBP) may be
allowed
to teach law and taxation subjects, Provided further that the position of either
the dean or department chairman or its equivalent that supervises the BSA
program of an educational institution is deemed to be in practice of accountancy
in the academe/education and therefore must be occupied only by CPA.

5
Practice in Government:
- One who holds or is appointed to, a position in an accounting professional group
in government or in a government-owned and/or controlled corporation, including
those performing proprietary functions, where decision making requires professional
knowledge in the science of accounting
- One where a civil service eligibility as a CPA is a prerequisite.

6
Professional Regulatory Board of Accountancy

(under the supervision and administrative control of the
Professional Regulation Commission)

Composed of a Chairman and six (6) members to be
appointed by the President of the Republic of the Philippines
from a list of three (3) recommendees and ranked by PRC from
a list of five (5) nominees.
Term of office 3 years renewable for another term, lapse of one
(1) year. No person shall serve the Board for more than twelve
(12) years.
.
t

7
Qualifications of the members of the Board:
Must be a natural born citizen and a resident of the Phils.

Must be a duly registered CPA with at least ten (10) years
work experience in any scope of practice of accountancy
Must be of good moral character and must not have been
convicted of crimes involving moral turpitude.
Must not have any pecuniary interest in any school, college, university
or institution offering academic degree
Must not be a director or officer of APO at the time of appointment

8
Powers and Functions of the Board:
1. To prescribe and adopt the rules and regulations necessary for

carrying out the provisions of this Act.
2. To supervise the registration, licensure and practice of accountancy
in the Philippines.
3. To administer oaths in connection with the administration of this Act.
4. To adopt an official seal of the Board.
5. To monitor the conditions affecting the practice of accountancy in
the Philippines.

9
6. To issue, suspend, revoke or reinstate the Certificate of Registration for the

practice of accountancy.
7. To prescribe and/or adopt a Code of Ethics for the practice of accountancy.
8. To conduct an oversight into the quality of audits of financial statements
through a review of the quality control measures.
9. To investigate violations of this Act and the rules and regulations
promulgated hereunder and for this purpose, to issue summons to violators.
10. To issue a cease or desist order to any person, association, partnership or
corporation engaged in violation of any provision of RA 9298, any
accounting or auditing standards promulgated by the Board.

10
11. To punish for contempt of the Board, both direct or indirect, in accordance
with the pertinent provisions of and penalties prescribed by the Rules of
Court.
12. To prepare, adopt, issue or amend the syllabi of the subjects for examinations
in consultation with the academe, determine and prepare questions for the
licensure examination as well as, administer, correct and release the results
of the licensure examination.
13. To ensure, in coordination with the Commission on Higher Education (CHED)
or other authorized government offices, that all higher educational
instruction and offering of accountancy, including accounting review centers
and/or CPE providers offering accounting seminars, comply with the policies,
standards and requirements of the course prescribed by CHED or other
authorized government officer of CPE Council as the case may be.

11
Grounds for Suspension or Removal of Members of the

Board:
1. Neglect of duty or incompetence.
2. Violation or tolerance of any violation of this Act and its
implementing rules and regulations or the Certified Public
Accountants Code of Ethical and technical and professional
standards of the practice for certified public accountants.
3. Final judgment of crimes involving moral turpitude.
4. Manipulation or rigging of the certified public accountants
licensure examination in the examination questions prior to the
conduct of the said examination or tampering of grades .

12
Financial Reporting Standards Council (FRSC)

- Accounting standard setting body
- Composed of 15 members with a Chairman, who had been or previously
a senior accounting practitioner in any scope of accounting practice
and fourteen (14) representatives from the following:
(a) Board of Accountancy .. 1
(b) Securities and Exchange Commission .. 1
(c ) Bangko Sentral ng Pilipinas .. 1
(d) Bureau of Internal Revenue . 1
(d) An major organization composed of
preparers and users of f/s
1
(f) Commission on Audit .. 1
(g) Accredited National Professional Organization
of CPAs
Public Practice.. 2
Commerce and Industry ... 2
Academe/Education 2
Government . 2
8
---------Total
14
===
13
Auditing and Assurance Standards Council (AASC)

- Auditing standard setting body
- Composed of 17 members with a Chairman, who had been or previously
a senior practitioner in public accountancy and sixteen (16)
representatives from the following:
(b) Securities and Exchange Commission .. 1
(c ) Bangko Sentral ng Pilipinas .. 1
(d) An association or organization of CPAs in
active public practice of accountancy 1
(f) Commission on Audit .. 1
(g) Accredited National Professional Organization
of CPAs
Public Practice.. 9
Academe/Education 1
----11
----Total
16
===
14
Education Technical Council (ETC)

- Created by PRC upon recommendation of BOA
- Assist the Board in the attainment of the objective of continuously
upgrading the accountancy education in the Philippines to make the
Filipino CPAs globally competitive.
- Composed of seven (7) members with a Chairman, who had or been
presently a senior accounting practitioner in the academe/education
and six (6) representatives from the following:
(b) Accredited National Professional Organization
of CPAs
Public Practice.. 1
Academe/Education 2
Government . 1
5
---------Total
6
===
- Term is three (3) years renewable for another term.
15
Education Technical Council (ETC)

-
Functions:
(a) Determine a minimum standard curriculum for the study of
accountancy to be implemented in all schools offering accountancy
as an undergraduate degree.
(b) Establish teaching standards, including the qualifications of members
of the faculty of schools and colleges of accountancy.
(c) Monitor the progress of the program on the study of accountancy
and undertaking measures for the attainment of a high quality of
accountancy education in the country.
(d) Evaluate periodically the performance of educational institutions
offering accountancy education.

16
Examination, Registration and Licensure

The Certified Public Accountant Examination
Qualifications of applicants for examination:
1. Is a Filipino citizen.
2. Is of good moral character.
3. Is a holder of the degree of Bachelor of Science in Accountancy
conferred by a school, college, academy or institute duly recognized
and/or accredited by CHED or other authorized government
offices.
4. Has not been convicted of any criminal offense involving
moral turpitude.

17
Examination, Registration and Licensure

The Certified Public Accountant Examination
Documents for submission:
1. Certificate of Live Birth in National Statistics Office (NSO)
Security Paper.
2. Marriage Contract in NSO Security Paper.
3. College Diploma with indication therein of the date of graduation
and Special Order Number unless it is not required.
4. Baccalaureate Transcript of Records with indication therein of
date of graduation and Special Order Number unless it is not required.
5. National Bureau of Investigation (NBI) Clearance.
6. Other documents that the Board may require.
18
Scope of Examination:
1. Theory of Accounts
2. Business Law and Taxation
3. Management Services
4. Auditing Theory
5. Auditing Problems
6. Practical Accounting Problems 1
7. Practical Accounting Problems 2

19
Rating in the Licensure Examination:

Passing
a weighted general average of seventy five percent (75%),

with no grade lower than sixty five percent (65%) in any
given subject.
Conditional a weighted average of seventy five percent (75%) and

above in at least majority of subjects.
Failed
a weighted average of below seventy five (75%).

20
Report of Rating:
- The Board shall submit to the Commission the ratings obtained
by each candidate within ten (10) days after the examination, unless
extended for just cause.

21
Failing candidates to take refresher course

Any candidate who fails in two (2) complete CPA Board
Examination shall be disqualified from taking another set
of examinations unless he/she enrolled in and completed at least
twenty four (24) units of subject given in the licensure
examination.

22
Oath
All successful candidates in the examination shall be required to
take an oath of profession before any member of the Board or
any government official authorized by the Commission or any
person authorized by law to administer oath upon presentation
of proof of his/her qualification, prior to entering upon the practice
of the profession.

23
Certificate of Registration
and
Professional Identification Card
Shall bear the signature of the Chairperson of the Commission
and the chairman and members of the Board, including that
person named therein is entitled to the practice of the profession
with all the privileges appurtenant thereto.

24
Indication of Certificate of Registration, Professional

Identification Card and Professional Tax Receipt
- COR No. & PIC No. with
- Date of Issuance and the Duration of Validity
including PTR No. which the City/Municipal
Treasurer has issued to CPA

25
Refusal to issue Certificate of Registration and

Convicted by a court of competent jurisdiction of
a criminal offense involving moral turpitude or
guilty of immoral and dishonorable conduct
Any person of unsound mind.

26
Suspension and Revocation of Certificates of Registration and

1. Unprofessional or unethical conduct.
2. Malpractice
3. Violation of any provisions of RA9298

27
Reinstatement, Reissuance and Replacement of Revoked

or Lost Certificates
The Board may, after the expiration of two (2) years from the date of
revocation and for reasons deemed proper and sufficient, reinstate the
validity of a revoked certificate of registration and in so doing, may,
in its discretion, exempt the applicant from taking another
examination.

28
Limitation of the Practice of Public Accountancy
Single practitioners
Partnerships

29
Meaningful Experience:
(a) Commerce and industry
tax
Significant involvement in general accounting, budgeting, tax

administration, internal auditing, liaison with external auditors,
representing his/her employer before government agencies on
and matters related to accounting or any other related functions.
(b) Academe/Education
-
Teaching for at least three (3) trimesters or two (2) semesters ,

subjects in either financial accounting, business law and
management services

30
Meaningful Experience:
(c) Government
-
Significant involvement in general accounting, budgeting

and tax administration, internal auditing, liaison with
Commission on Audit or any other related functions.
(d) Public Practice

- One year as audit assistant and at least two years as auditor
in charge covering full audit functions of significant clients.

31
Ownership of Working Papers

All working papers, schedules and memoranda made by a CPA and his staff in the
course of an examination, including those prepared and submitted by the client,
incident to or in the course of examination, by such CPA, except reports submitted by
a certified public accountant to a client shall be treated confidential and privileged
and remain the property of such CPA in the absence of written agreement between
the CPA and the client, to the contrary, unless such documents are required to be
produced through subpoena issued by any court, tribunal or governmental regulatory
or administrative body in accordance with Philippine laws.

32
Seal and Use of Seal

Circular in form with a smaller circle within and in the upper portion
of the space between the circles shall be engraved the name of the
individual CPA, firm and the signing partner of the partnership and in
the middle of the smaller circle shall be engraved the letters CPA.

33
Accredited Professional Organization

Philippine Institute of Certified Public Accountants (PICPA)
- recognized by SEC as APO on October 2, 1975 (Accreditation No. 15)
Requirements:
1) Establishment for the benefit and welfare of CPAs

2) Open membership to all registered CPAs without discrimination
3) Sectoral membership in the public practice, commerce & industry,
academe/education and government.

34
Renewal for Accreditation

- Once every three (3) years after the date of Resolution granting the
petition for re-accreditation and the issuance of said Certificate upon
submission of the requirements.
Cancellation for Accreditation
1) It has ceased to possess any of the qualifications for accreditation
2) It no longer serves the best interest of the CPAs.
3) It did not achieve its plan to enlist into active membership within
three (3) years, majority of the CPAs in the practice of accountancy.

35
Cancellation for Accreditation
4) It has committed acts inimical to its members and to the profession.

5) It has not renewed its certificate of accreditation after a lapse of an
unreasonable period for the date of its scheduled renewal.
6) It has not submitted the required audited financial statements.

36
Accreditation in the Practice of Public Accountancy

Registration valid for three (3) years from the date application for
accreditation is approved.
Renewal
- on or before September 30 on the year of expiry upon

compliance of the requirements.

37

e.g. If the application of registration of ABC Co., CPAs was approved on
April 12, 2012, the registration shall expire on December 31, 2014
and therefore, it shall file for renewal on or before September 30, 2014
for the three year period beginning January 1, 2015.

38

Registered Name:
1) Name of an individual as printed in his/her CPA certificate.
2) Firm firm name appearing in the registration documents issued by
DTI or any other proper government offices.
3) Partnership partnership name as indicated in the current Articles of
Partnership and certificates of registration issued by SEC.

39
A CPA shall practice only under an individual firm or partnership

name allowed in accordance with Philippine laws and shall not
include any fictitious name, indicate specialization or is
misleading as to the type of organization (proprietorship or
partnership).

40
Voluntary Withdrawal of Registration/Reinstatement

- Filing with the Board a petition in writing stating the
reason(s).
- Should be duly authenticated and signed by the individual
CPA or any of his/her staff member, the sole proprietor or
any of the staff members or all the partners of the
Partnership, or any of them or any of the staff member(s)
who are requesting for the voluntary withdrawal of
registration.

41
Voluntary Withdrawal of Registration/Reinstatement

- The Board shall publish the request of the withdrawal of
registration in the principal place/business of the
Individual CPA, Firm or Partnership.
- If there is no opposition to the petition, the Board shall
recommend approval to the Commission.
- Upon approval, the petitioners name shall be removed
from the roll of Individual CPAs, Firms and Partnerships
of duly registered practitioners of public accountancy and
the petitioner shall be notified in writing of the withdrawal
of registration.
42
Quality Review
-
Quality Review Committee (QRC) is a body created by BOA upon

approval of PRC to conduct an oversight into the quality of audit of
financial statements through a review of the quality control measures
instituted by Individual CPAs, Firms or Partnerships in order to ensure
compliance with accounting and auditing standards and practices.
- QRC shall be composed of a seven (7) member body with a chairman,

who had been or presently a senior practitioner in public accountancy and
six representatives from BOA (1) and Accredited National Professional
Organization (5); (2) ACCPAPP, (1) ACPAE, (1) ACPACI, (1)
GACPA.

43
Quality Review Committee

Functions:
1) Conduct quality review on applicants for registration to practice public
accountancy and render a report which shall be attached to the
application for registration.
2) Recommend to the Board the revocation of the Certificate of
Registration (COR) and Professional Identification Card (PIC) of an
Individual CPA, including any of his/her staff members, Firms
including the sole proprietors and any of his/her staff members.

44
Death or Disability of an Individual CPA & Dissolution or

Liquidation of a Firm or Partnership of CPAs
-
Reported to the Board not later than thirty (30) days from the date of
such death, dissolution or liquidation.
The report shall be in the form of an affidavit or by furnishing the Board

with the certified copy of the dissolution or liquidation papers filed
with SEC in the case of Partnership.
Failure to report shall be subjected to penalties.

45
Foreign Reciprocity
Subjects or citizens of foreign countries may be allowed to practice
Accountancy in the Philippines in accordance with the provisions of existing
laws, international treaty obligations including mutual recognition agreements
entered into by the Philippine government with other countries.

46
Coverage of Temporary/Special Permits

1) A foreign CPA called for consultation or for a specific purpose, which in the
judgment of the Board, is essential for the development of the country,
provided, that his/her practice shall be limited only for the particular work
that he/she is being engaged, provided further, that there is no Filipino CPA
qualified for such consultation or specific purpose.
2) A foreign CPA engaged as professor, lecturer, or critic in fields essential to
accountancy education in the Phils. and his/her engagement is confined to
teaching only.

47
Coverage of Temporary/Special Permits

3) A foreign CPA who is internationally recognized expert or with
specialization in any branch of accountancy and his/her service is
essential for the advancement of accountancy in the Philippines.

48
Penal Provision
Fine of not less than fifty thousand pesos

(50,000) or by
Imprisonment for a period not exceeding
two (2) years or
Both

49
Continuing Professional
Education
(CPE) Program

50
Continuing Professional Education

- Refers to the inculcation, assimilation and
acquisition of knowledge, skills, proficiency and
ethical and moral values, after the initial registration
of a professional that raise and enhance the
professionals technical skills and competence.

51
CPE Program Objectives:

1) To provide and ensure the continuous education of a
registered professional with the latest trends in the
profession brought about by modernization and
scientific and technological advancements.
2) To raise and maintain the professionals capability
for delivering professional services.
3) To attain and maintain the highest standards and
quality in the practice of his profession.
4) To promote the general welfare of the public.

52
PRC CPE Council

- Created by BOA upon approval of PRC
- Composed of chairperson and two (2) members.
- The chairperson shall be chosen from among the
members of the Board by the members themselves.
- The first member shall be president or in his/her
capacity, any officer chosen by the Board of
Directors of PICPA.
- The second member shall be president or in his/her
capacity, any officer of the organization of deans or
department heads of schools, colleges or universities
offering the degree requiring licensure examination.
53
PRC CPE Council

Powers and Functions:
1) Accept, evaluate and approve applications for accreditation of
CPE providers.
2) Accept, evaluate and approve applications for accreditation of
CPE programs, activities or sources as to their relevance to the
profession and determine the number of CPE credit units to be
earned on the basis of the contents of the program, activity or
source submitted by the CPE providers.
3) Accept, evaluate and approve applications for exemptions from
CPE requirements.
4) Monitor the implementation by the CPE providers of their
programs, activities or sources.
54
PRC CPE Council

Powers and Functions:
5) Assess periodically and upgrade criteria for accreditation of
CPE providers and CPE programs, activities or sources.
6) Perform such other related functions that may be incidental to
implementation of the CPE programs or policies.

55
Programs, Activities and Sources for

Accreditation and Equivalent Credit Units
1) Seminars
2) Conventions
3) Masteral Degree
4) Doctoral Degree
5) Authorship
6) Self-Directed Learning Package
7) Post Graduate/In-Service Training
8) Resource Speaker

56
Programs, Activities and Sources for Accreditation

and Equivalent Credit Units
9)
Peer Reviewer
10) CPE Provider

11) CPE Programs, Activities or Sources

57
Sixty (60) credit units for three (3) years, provided that
a minimum of fifteen (15) credit units shall be earned
in each year. Any excess credit units in one year may
be carried over to the succeeding years within the
three-year period. Excess credit units earned shall not
be carried over to the next three-year period except
credit units earned for doctoral and masters degrees.

58
Exemptions from CPE Requirements
Permanent Exemption:
- reaching the age of 65 years old.
Upon
Temporary Exemption:
Practicing his/her profession or furthering his/her
studies abroad provided that he/she has been out of the
country for at least two (2) years immediately prior to
the date of renewal.
59
Goal is reached only if the distance is

traveled.
Good luck & God bless.

60

Accountancy Act of 2004 Revised

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Philippine Accountancy Act of 2004

Philippine Accountancy Act of 2004

Republic Act 9298 is known as Philippine Accountancy

The standardization and regulation of accounting

The examination for registration of certified public

The supervision, control and regulation of the practice

Philippine Accountancy Act of 2004

Practice of Public Accountancy:

audit or verification of financial transactions and accounting records

Practice in Commerce and Industry:

One who is involved in decision making requiring professional knowledge

One who represents his/her employer before government agencies on tax

One when such employment or position requires the holder to be a CPA

Philippine Accountancy Act of 2004

Philippine Accountancy Act of 2004

Philippine Accountancy Act of 2004

Professional Regulatory Board of Accountancy

Professional Regulation Commission)

Philippine Accountancy Act of 2004

Qualifications of the members of the Board:

Must be a natural born citizen and a resident of the Phils.

Philippine Accountancy Act of 2004

Powers and Functions of the Board:

1. To prescribe and adopt the rules and regulations necessary for

Philippine Accountancy Act of 2004

Powers and Functions of the Board:

6. To issue, suspend, revoke or reinstate the Certificate of Registration for the

Philippine Accountancy Act of 2004

Powers and Functions of the Board:

Philippine Accountancy Act of 2004

Grounds for Suspension or Removal of Members of the

Philippine Accountancy Act of 2004

Financial Reporting Standards Council (FRSC)

Auditing and Assurance Standards Council (AASC)

Education Technical Council (ETC)

Education Technical Council (ETC)

Philippine Accountancy Act of 2004

Examination, Registration and Licensure

Philippine Accountancy Act of 2004

Examination, Registration and Licensure

Philippine Accountancy Act of 2004

Rating in the Licensure Examination:

a weighted general average of seventy five percent (75%),

Conditional a weighted average of seventy five percent (75%) and

a weighted average of below seventy five (75%).

Philippine Accountancy Act of 2004

Philippine Accountancy Act of 2004

Failing candidates to take refresher course

Philippine Accountancy Act of 2004

Philippine Accountancy Act of 2004

Philippine Accountancy Act of 2004

Indication of Certificate of Registration, Professional

Philippine Accountancy Act of 2004

Refusal to issue Certificate of Registration and

Philippine Accountancy Act of 2004

Suspension and Revocation of Certificates of Registration and

Philippine Accountancy Act of 2004

Reinstatement, Reissuance and Replacement of Revoked

Philippine Accountancy Act of 2004

Limitation of the Practice of Public Accountancy

Philippine Accountancy Act of 2004

Significant involvement in general accounting, budgeting, tax

Teaching for at least three (3) trimesters or two (2) semesters ,