Characteristics/ Attributes of a Profession:

a. Mastery of a particular intellectual skill, acquired by training and education;

b. Adherence by its members to a common code of values and conduct established by its
administering body, including maintaining an outlook which is essentially objective; and
c. Acceptance of a duty to society as a whole (usually in return for restrictions in use of a title or in
the granting of a qualification.

Important Role of CPAs in Society:

The public rely on CPAs for:

a. Sound financial accounting and reporting
b. Effective financial management
c. Competent advice on a variety of business and taxation matters

Regulation of the Accounting Profession:

1. Public Regulation – RA 9298 otherwise known as ―The Philippine Accountancy Act of 2004
(including its Implementing Rules and Regulations)
2. Regulation by the Profession – through the implementation of the Code of Ethics for
professional accountants / CPAs in the Philippines
3. Regulation within the Firm – through implementation of a system of quality control

RA 9298 otherwise known as ―The Philippine Accountancy Act of 2004

Regulatory Government Agencies:

a. Professional Regulation Commission (PRC) – the government agency that administers,

implements and enforces the regulatory policies of the Philippine Government with respect to
the regulation and licensing of the various professions (such as the accountancy profession)
under its jurisdiction

The PRC is the government agency that has overall jurisdiction over the regulatory boards (such
as the Board of Accountancy) in the Philippines.

b. Professional Regulatory Board of Accountancy (BOA) – the government agency empowered to

administer/enforce the Philippine Accountancy Act of 2004 (RA 9298) · BOA is under the
administrative supervision of the PRC

Objectives of the Philippine Accountancy Act:

a. The standardization and regulation of accounting education;
b. The examination for registration of CPAs; and
c. The supervision, control, and regulation of the practice of accountancy in the Philippines.

Scope of Practice of Accountancy:

1. Practice of Public Accountancy - shall constitute in a person, be it his/her individual capacity, or

as a partner or as a staff member in an accounting or auditing firm, holding out himself/herself
as one skilled in the knowledge, science and practice of accounting, and as a qualified person to
render professional services as a certified public accountant; or offering or rendering, or both, to
 more than one client on a fee basis or otherwise.

2. Practice in Commerce and Industry - shall constitute in a person:

a. Involved in decision making requiring professional knowledge in the science of accounting,
(as well as the accounting aspects of finance and taxation); or
b. When the CPA represents his employer before government agencies on tax and other
matters related to accounting
c. When such employment or position requires that the holder thereof must be a CPA.

3. Practice in Education / Academe - shall constitute in a person in an educational institution which

involve teaching of accounting, auditing, management advisory services, finance, business law,
taxation, and other technically related subjects.

CPA is considered to be engaged in the practice of accountancy in education / academe

if he/she is employed in educational institutions as teachers of accounting, auditing, MAS,
(accounting aspects of) finance, business law, taxation and other technically related subjects. ·

Members of the Integrated Bar of the Philippines (IBP) may be allowed to teach business
law and taxation subjects.

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 academic /education and therefore must be occupied only by a duly
registered CPA

4. Practice in Government - shall constitute in a person 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, or where a civil service eligibility as a CPA
is a prerequisite.

The BOA is the official government agency empowered to enforce RA 9298.

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

Composition of BOA: BOA shall be composed of a chairman and 6 members (all of which are to be
appointed by the President of the Philippines). BOA shall elect a vice-chairman from among its members
for a term of 1 year. According to the IRR, the 4 sectors in the practice of accountancy shall as much as
possible be equitably represented in the BOA.
 A. Natural-born citizen and a resident of the Philippines;
B. Duly registered CPA with at least 10 years of work experience in any scope of practice of
accountancy
C. Of good moral character and must not have been convicted of crimes involving moral turpitude
D. Not have any pecuniary interest, directly or indirectly, in any school, college, university or
institution conferring an academic degree necessary for admission to the practice of
accountancy (those that offer BSA degree) or where review classes in preparation for the
licensure examination are being offered or conducted (such as RESA, PRTC and CPAR), nor shall
he/she be a member of the faculty or administration thereof at the time of his/her appointment
to the BOA, and
E. Not be a director/officer of the APO (PICPA) at the time of his/her appointment

Term of office of BOA members:

The Chairman and the members of the BOA members shall hold office for a term of 3 years.

Any vacancy during the term of a member shall be filled up for the unexpired portion of
the term only. Appointment to fill up an unexpired term is not to be construed as a complete term.

No person who has served 2 successive complete terms shall be eligible for reappointment until
the lapse of 1 year.

No person shall serve in the BOA for more than 12 years. (addition under the IRR)

Powers and Functions of the BOA:

The BOA shall exercise the following specific powers, functions and responsibilities:

a. To prescribe and adopt the rules and regulations necessary for carrying out the provisions of this
Act (RA 9298)
b. To supervise the registration, licensure and practice of accountancy in the Philippines;
c. To administer oaths
d. To issue, suspend, revoke, or reinstate the Certificate of Registration for the practice of the
accountancy profession
e. To adopt its own official seal
f. To prescribe and/or adopt a Code of Ethics for the practice of accountancy
g. To monitor the conditions affecting the practice of accountancy and adopt such measures,
including promulgation of accounting and auditing standards, rules and regulations and best
practices as may be deemed proper for the enhancement and maintenance of high professional,
ethical, accounting and auditing standards
h. To conduct an oversight into the quality of audits of financial statements through a review of
the quality control measures
i. To investigate violations of this Act as IRR, to issue summons, subpoena and subpoena ad
testificandum and subpoena duces tecum to violators or witness thereof and compel their
 attendance to such investigation or hearings and the production of documents in connection
therewith
j. The Board may, motu propio in its discretion, make such investigations as it deems necessary to
determine whether any person has violated any provisions of this law, any accounting or
auditing standard or rules duly promulgated by the BOA as part of the rules governing the
practice of accountancy
k. To issue a cease or desist order to any person, association, partnership or corporation engaged
in violation of any provision of this Act, any accounting or auditing standards or rules duly
promulgated by the BOA as part of the rules governing the practice of accountancy in the
Philippines
l. To punish for contempt of the BOA, both direct and indirect, in accordance with the pertinent
provisions of and penalties prescribed by the Rules of Court
m. 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 which shall
strictly be within the scope of the syllabi of the subjects for examinations as well as administer,
correct and release the results of the licensure examinations
n. 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 comply
with the policies, standards and requirements of the course prescribed by CHED or other
authorized government offices in the areas of curriculum, faculty, library and facilities; and
o. To exercise such other powers as may be provided by law as well as those which may be implied
from, or which are necessary or incidental to the carrying out of, the express powers granted to
the BOA to achieve the objectives and purposes of this Act.

Grounds for Suspension or Removal of BOA Members:

The President of the Philippines, upon the recommendation of the PRC may suspend or remove any BOA
member on the following grounds:

a. Neglect of duly or incompetence

b. Violation or tolerance of any violation of RA 9298 and its IRR or the CPA Code of Ethics and the
technical and professional standards of practice for CPAs .

c. Final judgment of crimes involving moral turpitude

d. Manipulation or rigging of the CPA's licensure examination results, disclosure of secret and
confidential information in the examination questions prior to the conduct of the said
examination or tampering of grades

Councils/committee formed to assist BOA:

1. Financial Reporting Standards Council (FRSC) – assists BOA in the establishment and
promulgation of GAAP in the Philippines

2. Auditing and Assurance Standards Council (AASC) – created to assist BOA in the establishment
and promulgation of GAAS in the Philippines
 3. Education Technical Council (ETC) – assists BOA in continuously upgrading accounting education
in the Philippines

4. Quality Review Committee (QRC) – conducts an oversight into the quality of audits of financial
statements through a review of the quality control measures instituted by an Individual CPAs,
Firm or Partnership of CPAs engaged in the practice of public accountancy to ascertain
his/her/its compliance with prescribe professional, ethical and technical standards of public
practice

5. 5. PRC CPE Council – assists BOA in implementing its CPE program.

CPA Examinations:

All applicants for registration for the practice of accountancy shall be required to undergo a
licensure examination to be given by the BOA in such places and dates as the PRC may designate subject
to compliance with the requirements prescribed by the PRC.

Qualifications of Applicants for CPA Examinations:

a. Must be a Filipino citizen

b. Must be of good moral character

c. Must be a holder of the degree of BSA conferred by a school, college, academy or institute duly
recognized and/or accredited by the CHED or other authorized government offices, and

d. Has not been convicted of any criminal offense involving moral turpitude

Scope of examination:

1. Advanced Financial Accounting and Reporting. (AFAR)

2. Auditing
3. Financial accounting and Reporting
4. Management Advisory Services
5. Taxation
6. Regulatory Framework for Business Transactions (RFBT)
7.

The candidates with conditional status shall take an examination in the remaining subjects within 2
years from the preceding examination. If the candidate fails to obtain at least a general average of 75%
and a rating of at least 65% in each of the subjects reexamined, he/she shall be considered as failed in
the entire examination. The original exam and the removal exam are counted as one exam only.
Candidates required to take Refresher Course:

Any candidate who fails in 2 complete CPA exams shall be disqualified from taking another set of
examinations unless he/she submits evidence to the satisfaction of the BOA that he/she
enrolled in and completed a refresher course with at least 24 units of subjects given in the CPA
exams

Oath

All successful candidates in the CPA examination, prior to entering upon the practice of the
profession, shall be required to take an oath of profession before:

a. Any member of the BOA;

b. Any government official authorized by the PRC;

c. Any person authorized by law to administer oaths

Issuance of Certificates of Registration and Professional Identification Card:

Certificate of Registration – a certificate under seal bearing a registration number, issued to an

individual, by the PRC, upon recommendation by the BOA, signifying that the individual has
complied with all the legal and procedural requirements for such issuance including, in
appropriate cases, having successfully passed the CPA licensure examination.

Professional Identification Card – a card with validity of 3 years bearing the registration
number, date of issuance with an expiry date, due for periodic renewal, duly signed by the
Chairperson of the PRC issued by the PRC to a registered CPA upon payment of the annual
registration fees for 3 years

Grounds for Refusal to Issue Certificate of Registration and Professional ID:

a. Convicted by a court of competent jurisdiction of a criminal offense involving moral turpitude

b. Guilty of immoral and dishonorable conduct or
c. Of unsound mind

Causes or Grounds for Suspension/Revocation/Cancellation:

a. Convicted by a court of competent jurisdiction of a criminal offense involving moral turpitude or

b. Guilty of immoral and dishonorable conduct or
c. Of unsound mind
d. Any unprofessional or unethical conduct
e. Malpractice
f. Violation of any of the provisions of this Act and its IRR
g. Violation of the CPA”s Code of Ethics and the technical and professional standards of practice
for CPAs.

Reinstatement, Reissuance and Replacement of Revoked Certificates:

The BOA may, after the expiration of 2 years from the date of revocation of a certificate of
registration and upon application 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.

Prohibition in the Practice of Accountancy:

 Non-CPAs: Are not allowed to practice accountancy in the Philippines cannot use the title
Certified Public Accountant or CPA
 Should not indicate (thru display or use any title, sign, card, advertisement, or other device) that
he practices or offers to practice accountancy or that he is a CPA

Prohibition in the Practice of Accountancy:

Non-Filipino professional accountants/CPAs Are also not allowed to practice accountancy in the
Philippines, unless:

1. Through foreign reciprocity – A person not a citizen of the Philippines may be allowed
to practice accountancy in the Philippines: Where there is foreign reciprocity (in
accordance with provisions of existing laws, international treaty obligations including
mutual recognition agreements entered into by the Philippine government with other
countries) upon presentation of proof that his country admits citizens of the Philippines
to the practice of accountancy without restriction.

2. With valid temporary/special permit duly issued by the BOA and the PRC – Special /
temporary permit may be issued by the BOA subject to the approval of the PRC and
payment of the fees the latter has prescribed and charged thereof to the following
Foreign CPAs:
a. A foreign CPA called for consultation or for a specific purpose which, in the
judgment of the BOA, 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 purposes; A foreign CPA engaged as professor, lecturer
or critic in fields essential to accountancy education in the Philippines and
his/her engagement is confined to teaching only; and
b. A foreign CPA who is an 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.

Limitations of the Practice of Public Accountancy

1. Single practitioners (individual CPAs) and Partnership of CPAs shall be registered CPAs in the
Philippines.
2. The SEC shall not register any corporation organized for the practice of public accountancy. In
other words, corporation form of CPA firm is not allowed.
 3. A certificate of accreditation issued only after showing that the registrant has acquired the
minimum 3 years meaningful experience in any of the areas of accountancy (whether in the
public accountancy, commerce and industry, education/academe and government)

Definition of Meaningful Experience:

Allowed Names for the Practice of Accountancy:

1. Individual CPA: Shall use his/her registered name (the name registered with the BOA and the
PRC and as printed on his/her CPA certificate)
2. Firms: Shall use the duly registered and authorized firm name appearing in the registration
documents issued by the DTI or any other proper government office/s and such firm name shall
include the real name of the sole proprietor as printed in his/her CPA certificate For example:
3. Partnerships: In case of registered partnership – shall use the partnership name as indicated in
the Articles of Partnership and certificate of registration issued by the SEC
In case of unregistered partnership – shall use the partnership name indicated in the Articles of
Partnership .

Prohibition on Use of Name

1. Shall NOT include any fictitious name

2. Shall NOT indicate specialization (such as tax specialist or expert)
3. Shall NOT misleading as to the type of organization

Use of Seal:

All licensed CPAs shall obtain and use a seal of a design prescribed by the BOA bearing the
registrant‘s name, registration number and title. The auditor‘s reports shall be stamped with said seal,
indicating therein his/her current Professional Tax Receipt (PTR) number, date/place of payment when
filed with government authorities or when used professionally.

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 an
examination, by such CPA, except reports submitted by a CPA to a client shall be treated confidential
and privileged and remain the property of such CPA in the absence of a 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 government regulatory or administrative body.

Penal Provision

Any person who shall violate any of the provisions of this Act or any of its IRR shall, upon
conviction, be punished by:

Fine not less than P 50,000.00, or Imprisonment for a period not exceeding 2 years, or Both.

Continuing Professional DEVELOPMENT - 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 professional's technical skills and competence.

REQUIRED CPE UNITS

RENEWAL OF PROFESSIONAL IDENTIFICATION CARD 15 units.

FOR ACCREDITATION ( INITIAL AND RENEWAL) 120 units

Organizations that Affect Public Accounting:

1. Professional Regulation Commission (PRC) – the government agency that administers,

implements and enforces the regulatory policies of the Philippine Government with respect to
the regulation and licensing of the various professions (such as the accountancy profession)
under its jurisdiction · the professional regulation commission of the Philippines created under
RA No. 8981
2. Professional Regulatory Board of Accountancy (BOA) – the government agency empowered to
administer/enforce the Philippine Accountancy Act of 2004 (RA 9298)
3. Securities and Exchange Commission (SEC) – the government agency that regulates the
registration and operations of corporations (whether stock or non-stock), partnerships and
other forms of associations in the Philippines .
4. Bangko Sentral ng Pilipinas (BSP) – regulates and supervises the banking industry.
5. Commission on Audit (COA) – the government agency examines whether government units
handle their funds in compliance with existing laws and regulations and whether their programs
are being conducted effectively, efficiently and economically.
6. Bureau of Internal Revenue (BIR) – government agency that enforce tax laws; the BIR is
empowered to collect taxes to raise revenues for the use and support of the government
7. INSURANCE COMMISIONS- prescribes additional requirements when auditing insurance
companies