Updates From the PRBoA

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Updates from the Updates from the Professional Regulatory Professional Regulatory Board of AccountancyBoard of Accountancy

Hon. Ma. Elenita B. CabreraVice Chairman, PRBOA

Accounting Teachers’ ConferenceGeneral Santos City

April 19, 2010

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Presentation Coverage I. BSA CurriculumII. Accounting Teachers AccreditationIII. CPA Licensure Board ExaminationsIV. The Quality Assurance Review

(Oversight) Program

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On the BSA Curriculum

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On the Accounting Teacher Accreditation

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On the CPA Board Examinations

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Current Composition of the Board of Accountancy

Chairman: Hon. Eugene T. Mateo

Vice Chairman: Hon. Ma. Elenita B. Cabrera

Members: Hon. Rufo R. Mendoza

Hon. Luis A. Cañete

Hon. Jose S. Tayag, Jr.

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BOARD OF ACCOUNTANCY Memorandum

TO : All Schools, Colleges and Universities offering BSA Program, CPA Review Centers and Examinees in the October 2010 and subsequent CPA Licensure Examination

FROM : Eugene T. Mateo, Chairman, Board of Accountancy

SUBJECT : Philippine Accounting Standards (PASs), Philippine Financial Reporting Standards (PFRSs), Philippine Standards on Auditing (PSAs), Philippine Standards on Quality Control (PSQCs), Philippine Auditing Practice Statements (PAPSs), Philippine Standards on Review Engagements (PSREs), Philippine Standards on Assurance Engagements (PSAEs), Philippine Standards on Related Services (PSRSs) to be covered in the October 2010 and subsequent Certified Public Accountants (CPA) Licensure Examination

DATE : February 15, 2010

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NO. TITLE

Introduction to PFRS (approved in January 2007)Preface to PFRSs (approved in January 2007)

Framework for the Preparation and Presentation of Financial Statements (approved in January 2007)

Philippine Accounting Standards (PASs) and Philippine Financial Reporting Standards (PFRSs)

(Including ALL Related SIC, IFRIC and PIC Interpretations and CONSEQUENTIAL AMENDMENTS as a result

of the revision of PASs and PFRSs) Approved as of January 31, 2010

We wish to inform you that the following will be included in the October 2010 CPA Licensure Examination.

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NO. TITLE

PAS 1 Presentation of Financial Statements (Revised 2007) (effective January 1, 2009)

PAS 2 InventoriesPAS 7 Cash Flow Statements

PAS 8 Accounting Policies, Changes in Accounting Estimates and Errors

PAS 10 Events After the Balance Sheet Date

PAS 11 Construction Contracts

PAS 12 Income Taxes

PAS 16 Property, Plant and Equipment

PAS 17 Leases

PAS 18 Revenue

PAS 19 Employee Benefits

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NO. TITLE

PAS 20 Accounting for Government Grants and Disclosure of Government Assistance

PAS 21 The Effects of Changes in Foreign Exchange Rates

PAS 23 Borrowing Costs (Revised 2007) (effective January 1, 2009)

PAS 24 Related Party Disclosures

PAS 26 Accounting and Reporting by Retirement Benefit Plans

PAS 27 Consolidated and Separate Financial Statements (revised 2008)

PAS 28 Investments in Associates

PAS 29 Financial Reporting in Hyperinflationary Economies

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NO. TITLE

PAS 31 Interest in Joint Ventures

PAS 32 Financial Instruments: Disclosure and Presentation

PAS 33 Earnings Per Share

PAS 34 Interim Financial Reporting

PAS 36 Impairment of Assets

PAS 37 Provisions, Contingent Liabilities and Contingent Assets

PAS 38 Intangible Assets

PAS 39 Financial Instruments: Recognition and Measurement

PAS 40 Investment Property

PAS 41 Agriculture

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NO. TITLE

PFRS 1 First-Time Adoption of Philippine Reporting Standards

PFRS 2 Share-Based Payment

PFRS 3 Business Combination (revised 2008)

PFRS 4 Insurance Contracts

PFRS 5 Non-Current Assets Held for Sale and Discontinued Operations

PFRS 6 Exploration for and Evaluation of Mineral Resources

PFRS 7 Financial Instruments: Disclosures

PFRS 8 Operating Segments (effective January 1, 2009)PFRS for SMEs

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Interpretations TITLE

Preface to Interpretations

SIC – 7 Introduction to the Euro

SIC – 10 Government Assistance – No Specific Relation to Operating Activities

SIC – 12 Consolidation – Special Purpose Entities

Amendment to Interpretation SIC – 12 Scope of SIC – 12: Special Purpose Entities

SIC – 13 Jointly Controlled Entities – Non-Monetary Contributions by Venturers

SIC – 15 Operating Leases – Incentives

SIC – 21 Income Taxes – Recovery of Revalued Non- Depreciable Assets

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SIC – 25 Income Taxes – Changes in Tax Status of an Enterprise or its Shareholders

SIC – 27 Evaluating the Substance of Transactions Involving the Legal Form of a Lease

SIC – 29 Disclosure – Service Concession Arrangements

SIC – 31 Revenue – Barter Transactions Involving Advertising Services

SIC – 32 Intangible Assets – Web Site Costs

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Interpretations TITLEIFRIC 1 Changes in Existing Decommissioning,

Restoration and Similar LiabilitiesIFRIC 2 Members’ Shares in Co-operative Entities and

Similar InstrumentsIFRIC 4 Determining Whether an Arrangement Contains

a LeaseIFRIC 5 Rights to Interests arising from

Decommissioning, Restoration and Environmental Rehabilitation Funds

IFRIC 6 Liabilities arising from Participating in a Specific Market - Waste Electrical and Electronic Equipment

IFRIC 7 Applying the Restatement Approach under IAS 29 Financial Reporting in Hyperinflationary Economics

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IFRIC 8 Scope of IFRS 2

IFRIC 9 Reassessment of Embedded Derivatives

IFRIC 10 Interim Financial Reporting and Impairment

IFRIC 11 IFRS 2—Group and Treasury Share Transactions

IFRIC 12 Service Concession Arrangements

IFRIC 13 Customer Loyalty Programmes

IFRIC 14 PAS 19 – The Limit on a Defined Benefit Asset, Minimum Funding Requirements and their Interaction

IFRIC 15 Agreements for the Construction of Real Estate

IFRIC 16 Hedges of a Net Investment in a Foreign Operation

IFRIC 17 Distributions of Non-cash Assets to Owners

IFRIC 18 Transfers of Assets from Customers

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Q&A No. 2006 – 01PAS 18, Appendix, paragraph 9–Revenue recognition for sales of property units under pre-completion contractsQ&A No. 2006 – 02PAS 27.10(d) – Clarification of criteria for exemption from presenting consolidated financial statement

Q&A No. 2007 – 01 (revised)PAS 1.103(a) - Basis of Preparation of Financial Statements If an Entity Has Not Applied PFRSs in FullQ&A No. 2007 – 03PAS 40.27 - Valuation of Bank Real and Other Properties Acquired (ROPA)

PHILIPPINE INTERPRETATIONS COMMITTEE (PIC)PHILIPPINE INTERPRETATIONS COMMITTEE (PIC)QUESTIONS AND ANSWERS (QUESTIONS AND ANSWERS (Q&AsQ&As))

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Q&A No. 2007 – 04PAS 101.7 - Application of Criteria for a Qualifying NPAE(superseded by BOA Resolution No. 23 series of 2010)

Q&A No. 2008 – 02PAS 20.43 - Accounting for government loans with low interest rates under the amendments to PAS 20

Q&A No. 2009 – 01Framework, paragraph 23 and PAS 1.23 - Financial statements prepared on a basis other than going concern

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PSQCsPSQCs, Framework, , Framework, PSAsPSAs, , PAPSsPAPSs, , PSREsPSREs, , PSAEsPSAEs, , PSRSsPSRSs Approved as of January 31, 2010

NO. TITLE

Preface (Dec. 2006)

Preface to the International Standards on Quality Control, Auditing, Review, Other Assurance and Related Services and Preface to the Philippine Standards on Quality Control, Auditing, Review, Other Assurance and Related Services

- Philippine Framework for Assurance Engagements

- Glossary of Terms (December 2002) [amended by PSA 220 (Revised)]

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NO. TITLE

Philippine Standard on Quality Control (PSQC)

1(Redrafted)

Quality Control for Firms That Perform Audits and Reviews of Financial Statements, and Other Assurance and Related Services Engagements

Philippine Standards on Auditing (PSAs)

120 Framework of Philippine Standards on Auditing 200

(Revised and Redrafted)

Overall Objectives of the Independent Auditor and the Conduct of an Audit in Accordance with Philippine Standards on Auditing

210 (Redrafted) Agreeing the Terms of Audit Engagements

220 (Redrafted) Quality Control for an Audit of Financial Statements

230 (Redrafted) Audit Documentation

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NO. TITLE

Philippine Standards on Auditing (PSAs)

240 (Redrafted) The Auditor’s Responsibilities Relating to Fraud in an Audit of Financial Statements

250 (Redrafted) Consideration of Laws and Regulations in an Audit of Financial Statements

260 (Revised and Redrafted)

Communication with Those Charged with Governance

265 Communicating Deficiencies in Internal Control to Those Charged with Governance and Management

300 (Redrafted) Planning an Audit of Financial Statements

315 (Redrafted)

Identifying and Assessing the Risks of Material Misstatements Through Understanding the Entity and Its Environment

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NO. TITLE320 (Revised

and Redrafted)Materiality in Planning and Performing an Audit

330 (Redrafted) The Auditor’s Responses to Assessed Risks402 (Revised

and Redrafted) Audit Considerations Relating to an Entity Using a Service Organization


Evaluation of Misstatements Identified during the Audit

500 (Revised) Audit Evidence501 (Redrafted) Audit Evidence – Specific Considerations for

Selected Items505 (Revised

and Redrafted) External Confirmations

510 (Redrafted) Initial Engagements – Opening Balances520 (Redrafted) Analytical Procedures

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NO. TITLE530 (Redrafted) Audit Sampling


Auditing Accounting Estimates, Including Fair Value Accounting Estimates and Related Disclosures

545 Auditing Fair Value Measurements and Disclosures550 (Revised and

Redrafted)Related Parties

560 (Redrafted) Subsequent Events 570 (Redrafted) Going Concern


Written Representations


Special Considerations – Audits of Group Financial Statements (Including the Work of Component Auditors)

610 (Redrafted) Using the Work of Internal Auditors

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NO. TITLE620 (Revised

and Redrafted)Using the Work of an Auditor's Expert

700 (Redrafted)

Forming an Opinion and Reporting on Financial Statements


Modifications to the Opinion in the Independent Auditor's Report


Emphasis of Matter Paragraphs and Other Matter Paragraphs in the Independent Auditor's Report

710 (Redrafted)

Comparative Information - Corresponding Figures and Comparative Financial Statements

720 (Redrafted)

The Auditor’s Responsibility in Relation to Other Information in Documents Containing Audited Financial Statements


Special Considerations - Audits of Financial Statements Prepared in Accordance with Special Purpose Frameworks

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NO. TITLE


Special Considerations - Audits of Single Financial Statements and Specific Elements, Accounts or Items of a Financial Statement


Engagements to Report on Summary Financial Statements

Philippine Auditing Practice Statements (PAPSs)

1000 Inter-Bank Confirmation Procedures

1000Ph Audit Evidence – Practical Problems in an Audit of Financial Statements

1001Ph Guidance in Dealing with “Tentative Financial Statements”*

1002Ph The Auditor’s Report on General Purpose Financial Statements Prepared in Accordance with a Philippine Financial Reporting Framework Other Than PFRS

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NO. TITLE1003Ph Guidance in Dealing with Reports Required by the SEC

Relating to Increase in Capital Stock of a Corporation1004 The Relationship Between Bangko Sentral ng Pilipinas

(BSP) and Banks’ External Auditors

1005 (Revised)

The Special Consideration in the Audit of Small Entities

1006 Audits of the Financial Statements of Banks 1010 The Consideration of Environmental Matters in the Audit of

Financial Statements 1012 Auditing Derivative Financial Instruments [amended by

PSA 220 (Revised)] 1013 Electronic Commerce – Effect on the Audit of Financial

Statements 1014 Reporting by Auditors on Compliance with International

Financial Reporting Standards

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NO. TITLE

Philippine Standards on Review Engagements (PSREs)2400 Engagements to Review Financial Statements

(amended in 2008)2410 Review of Interim Financial Information Performed by

the Independent Auditor of the Entity (amended in 2008)

Philippine Standards on Assurance Engagements (PSAEs)

3000 (Revised)

Assurance Engagements Other Than Audits or Reviews of Historical Financial Information

3400 The Examination of Prospective Financial Information (previously PSA 810)

Philippine Standards on Related Services (PSRSs)

4400 Engagements to Perform Agreed-Upon Procedures Regarding Financial Information (previously PSA 920)

4410 Engagements to Compile Financial Information (previously PSA 930)

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Revised Code of Ethics for Professional Accountants in the Philippines

(effective June 30, 2008)

Rules on Advertising and Promotion for the Practice of Accountancy in the Philippines

(effective August 9, 2008)

Rules and Regulations for the Accreditation of Accounting Teachers

(effective June 20, 2008)

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The new standards / rules and regulations are available at

www.prboa.comwww.aasc.org.phwww.picpa.com.ph

Please be guided accordingly.

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Insights on the CPA Exams Results based on Items Analysis

Management Services

Very satisfactory performance(1) cost-volume profit relationship involving

determination of contribution margin, incremental sales to bring in additional income in a multi-product firm;

(2) capital budgeting problems applying the net present value concept; and

(3) simple cash budgeting and flexible budgeting problems.

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Management Services

Unsatisfactory performance (1) financing decisions such as availment of loan with

balloon payment and sources of financing short-term requirement;

(2) cost classification (e.g., period costs) and cost behavior;

(3) decision making (such as processing further or selling as is a product; increasing investment on inventory);

(4) use of balanced scorecard; (5) application of basic economic concepts in decision

making such as effect of change in exchange rate of foreign currency, cost of doing business, and effect of increase in government purchases or expenditures on marginal propensity to consume out of disposable income.

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Auditing Theory

Good results (1) overview of auditing; (2) objectives, evidence, and working papers; (3) professional practice; (4) internal control; and (5) professional responsibilities.

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Auditing Theory

Poor performance (1) completing the audit; (2) electronic data processing/computerized

audit; (3) audit process; (4) audit sampling; (5) audit reports; and (6) other services and reports.

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Auditing Problems

Good results (1) financial statement presentation for

companies with incomplete accounting data and will need reconstruction of account balances;

(2) conversion of cash basis to accrual basis of accounting; and

(3) financial statement presentation and classification and determination of adjusted net income.

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Auditing Problems

Poor results(1) auditing cash flows from investing activities; (2) auditing impairment loss in goodwill and

other intangible assets; (3) auditing shareholders’ equity accounts; (4) adjusting liability accounts; and (5) auditing capitalized cost of equipment

constructed for own use.

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Practical Accounting I

Good outcome (1) determination of correct inventory balance; (2) accounting for purchase of investment in available for

sale equity shares;(3) application of current value accounting in land; (4) recording the purchase of property and equipment;

and (5) reporting cash flows from operations.

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Practical Accounting I

Poor performance (1) computation of accrued interest in bonds payable; (2) determination of pension expense; (3) determination of effect of errors on net income; (4) accounting for impairment loss on receivables and

loans; (5) accounting for deferred taxes; (6) computation of diluted earnings per share where there

are options and convertible securities; and (7) financial statement classification of liabilities.

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Practical Accounting II

Good performance (1) accounting for foreign exchange

transactions; (2) accounting for investment of partners in a

partnership; (3) spoilage cost classification; (4) accounting for commercial franchise; and (5) accounting for construction contract costs.

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Practical Accounting II

Poor performance (1) accounting for investment in equity securities, using

the equity method; (2) application of purchase method in business

combination; (3) accounting for joint costs in process costing system; (4) application of proportionate method in consolidation;

and (5) distribution of partnership profit where the remaining

distributable profit is insufficient to meet interest on capital of partners.

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Theory of Accounts

Good performance

(1) accounting and financial accounting concepts;

(2) accounting process; (3) accounting for assets; and (4) accounting for liabilities.

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Theory of Accounts

Poor Performance(1) income recognition; and (2) financial statement presentation

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Business Law

Good performance(1) obligations and contracts; (2) partnership; (3) pledge and mortgages; and(4) sales and agency

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Business Law

Poor performance(1) corporation law; and (2) negotiable instruments

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Taxation

Good results(1) principles of taxation; (2) community tax; (3) interests and surcharges and compromise

penalty (4) income tax; (5) value-added tax;(6) percentage tax; and (7) transfer tax

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Taxation

Examinees performed better in Taxation than in Business Law.

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The QAR Program of the Board of Accountancy

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WHAT IS QUALITY ASSURANCE REVIEW (QAR)?

A study, appraisal or review

by the BOA or its duly authorized representative

of the quality of audit of financial statements (FS) by CPA public practitioners

through a review of the quality control (QC) measures the CPA instituted in his practice

to ascertain compliance with prescribed professional, ethical and technical standards of public practice.

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WHAT IS QUALITY ASSURANCE REVIEW’S RELEVANCE TO ACCOUNTING TEACHERS?

Accounting Teachers who are concurrently in public practice

Accounting Teachers who may want to become Quality Assurance Reviewers or Audit Inspectors

QAR Program would be part of the BSA Curriculum and CPA Licensure Examinations

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BASIS FOR QAR REQUIREMENT

Legal

RA 9298, The Philippine Accountancy Act of 2004- BOA is “to conduct an oversight into the quality of

audits of FS through a review of the QC measures instituted by auditors in order to ensure compliance with accounting and auditing standards and practices”

Professional Regulatory Board of Accountancy Resolution No. 23, Series of 2010, Revision of the Rules and Regulations for the Conduct by the Professional Regulatory Board of Accountancy of Oversight into the Quality of Audits of Financial Statements- Revision of Resolution No. 88, Series of 2009

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Professional

Quality Control and Auditing Standards- PSQC 1, Quality Control for Firms that Perform

Audits and Review of Financial Statements, and Other Assurance and Related Services Engagement

- PSA 220, Quality Control for an Audit of Financial Statements

IFAC Statement of Membership Obligations (SMO) No. 1 on Quality Assurance Review

“Where government, regulators or other appointed authorities perform any of the functions covered in this statement,” PICPA as a member body of IFAC, “should use its best endeavors to encourage those responsible for those functions to follow this SMO in implementing them, and assist them in that implementation where appropriate”

BASIS FOR QAR REQUIREMENT

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PARTIES IN THE IMPLEMENTATION

BOA - Mandated under RA 9298 to implement the QAR

Council for Accreditation and Quality Control of Practicing CPAs

BOA coordinates with and may seek assistance from this Council in the proper implementation of the QAR

Council created under a MOA dated August 12, 2009 by the BOA, SEC, BSP and IC

Quality Assurance Review Department (QARD)

Tasked to implement the QAR

Under supervision of the QAR Executive Committee

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PARTIES IN THE IMPLEMENTATION

Quality Assurance Review Executive Committee

Tasked to set policies and supervise the operation of the QARD

Consists of 2 BOA and 1 PICPA representatives

CPA Practitioners or Individual CPA, Firm or Partnership of CPAs engaged in Public Accountancy

Mandated to enroll in the QAR Program as a prerequisite to accreditation or renewal for accreditation.

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ROLE OF BOA

Assumes full responsibility in the discharge of the oversight function

Sets operating and other implementation policies

Organizes the QAR Department and ensures its independence

Compliance and monitoring

Implementation

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ROLE OF PICPA

Representation in the QAR Executive Committee

Enters into contract of service for personnel

Assists in personnel hiring

Assists in developing operating system and procedures

Provides infrastructure/facilities

QARD office – 4th floor (office and space)

Office furniture and fixtures

Laptops

Telephones/local area network

Training rooms, when needed

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CHIEF INSPECTORAUDIT INSPECTION & ASSISTANTS

CHIEF OF ADMINISTRATIONADMINISTRATION & ASSISTANTS

QAR PLANSPECIFIC QAR INSPECTION PLANQAR INSPECTION REPORTQAR CERTIFICATEQAR ANNUAL REPORTQAR TRAININGIMPLEMENTATION OF QAR POLICIES

ADMINISTRATIONENROLLMENT OF CPAsFUND CUSTODYRECEIPTS & DISBURSEMENTSRECORD KEEPINGCOMMUNICATION & PROMOTION

COUNCIL FOR ACCREDITATION AND

QUALITY CONTROL OF PRACTICING CPAs

( CREATED UNDER MOA DATED AUG 12, 2009 ,

EXECUTED BY BOA, SEC, BSP AND IC )

QUALITY ASSURANCE REVIEW DEPARTMENTQARD HEAD

(CONCURRENTLY , THE CHIEF INSPECTOR FOR GENERAL MANAGEMENT)

BOARD OF ACCOUNTANCY

QAR EXECUTIVE COMMITTEE

•ORGANIZE THE QARD•OPERATING & OTHER POLICIES•INDEPENDENCE OF QARD•COMPLIANCE AND MONITORING•IMPLEMENTATION •QAR REPORTS•CERTIFICATE OF QA COMPLIANCE•ANNUAL REPORTS

QUALITY ASSURANCE REVIEW ORGANIZATION

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Responsibility and Authority (BOA Resolution No. 23, Series of 2010, Section 5)

Full power and authority to set policies and to supervise the operation of QARD

Composition (Sections 5 and 6).

Chairman and Vice-Chairman of the Board or their alternate from any of the incumbent members of the Board

President of the APO or his alternate from any of the incumbent members of Board

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Term of Office.

Co-terminus with their respective term in the BOA/APO not to exceed three (3) years.

Qualification Requirements.

Should possess high degree of competence and objectivity

Should not be in active practice of public accountancy during their incumbency in the QAR Executive Committee.

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QUALIFICATIONS OF QARD PERSONNEL

Chief Inspector/Chief of Administration/Staff Auditors

Of good moral character

Not guilty of violating any professional ,ethical or financial and auditing standards or any accounting or reporting related regulations

Good oral/written communications skills

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QUALIFICATIONS OF QARD PERSONNEL

Additional requirements

Chief Inspector : with current CPA license; senior manager /partner with publicly listed clients; independent from auditee; with 10 years audit experience

Chief of Administration: 5 years administration work experience in supervisory capacity; independent from auditee

Staff auditor: with current CPA license; 5 years auditor or financial accounting or auditing teacher in a CHED recognized educational institution or an accountant with corporate financial reporting or internal auditing function; has not been terminated due to incompetence

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THE QAR PROGRAM

Coverage

All CPAs in the public accounting sector (an individual practitioner, a firm or a partnership)

Mandatory coverage

Enrollment in the QAR program is a pre-requisite for accreditation or renewal of accreditation by BOA

The CPA registration category should be stated in the certificate of accreditation.

Enrollment - Shall be considered by the BOA as compliance with the requirement of mandatory coverage.

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GUIDELINES FOR QAR PROGRAM

QARD - shall conduct the QAR Program, under the oversight responsibility of the Board

Frequency of registration

QAR registration is good only for one year

Renewable annually, as long as the CPA practitioner:- issues audit reports on the FS of clients, and- has not been the subject of sanctions and penalties imposed

by the BOA for violation of the provisions of these rules and regulations.

Precondition to new and subsequent accreditation

Enrollment is precondition to new and subsequent accreditation

Requires continuous compliance and registration, otherwise it can be a subject of fines and other penalties.

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Registration categories - in accordance with the following risk categories and the respective share in the QAR program (annual charge)

Category A – Registration for CPA practitioners handling clients that use full IFRS/PFRS and public-interest entities (listed and not- listed but with public accountability). This category is further broken down into 6 sub categories:

Category CPA Practitioners with: Annual Charge

A (1) over 50 listed clients 350,000 A (2) over 25 to 49 listed clients 250,000A (3) 1 to 25 listed clients 200,000A (4) 50 or more non listed clients 150,000 A (5) over 25 to 49 non listed clients 100,000A (6) 1 to 25 non listed clients 50,000

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Registration categoriesCategory B – Registration for CPA practitioners handling clients that use IFRS/PFRS for small and medium-sized entities (SMEs) This category is further broken down into 4 sub categories:

Category CPA Practitioners with: Annual ChargeB (1) over 200 clients 40,000 B (2) 101 to 200 clients 25,000B (3) 51 to 100 clients 15,000B (4) 1 to 50 clients 8,000

Registration fees - may be subject to adjustment in the succeeding years depending on the practitioners’ share in the expected expense of the QAR Program which should not be construed as limiting the scope of QAR that may be conducted by the QAR Department or Audit Inspection Unit (AIU).

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One registration category

A CPA practitioner can only register in one category (highest sub-category) division.

A CPA practitioner registered under category B can not audit companies that use full PFRS, unless he upgrades his registration to category A; same is true with the other sub-categories.

Information required for application of annual registration (initial and renewal)

Number of clients, classified as to public interest entities using full PFRS / PFRS for SMEs (under oath) to determine practitioner’s appropriate category

Application must be signed by the CPA, or the managing director / head of the firm of partnership- The signatory shall be liable administratively or criminally for any misrepresentations made under oath.

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Penalties - the registration rules may provide for penalties provided:

They do not exceed the penalties under these rules and regulations;

BOA is not precluded from imposing the appropriate penalties under the Philippine Accountancy Act of 2004 .

Confidentiality - Information obtained, work and reports of the AIU:

Strictly confidential and not to be divulged

Except only for purposes of determining whether or not to impose sanctions for violation of these rules and regulations or upon order of a court of competent jurisdiction

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General penalties and sanctions

Fine of not less than Php50,000.00, or

Imprisonment for a period not exceeding 2 years, or both, without prejudice to the imposition of administrative penalties of warning, admonition, fine, suspension or cancellation of the professional license as a CPA.

Administrative penalties and sanctions

Fines imposed on the APO for failure to comply with the requirements, for any violation of the rules: 1st offense, Php 1,000.00/day of violation /

noncompliance2nd offense, Php 2,000.00/day of violation /

noncompliance3rd offense, Php 4,000.00/day of violation /

noncompliance

- Continuing violation - Sufficient ground for suspension and eventual rescission by the BOA of the recognition it granted to the APO.

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Administrative penalties and sanctions

Fines for failure or refusal to timely submit proof of current registration:

Offense / per day of delay_________________________________

Category 1st 2nd 3rd

A1 to A3 1,500 3,000 9,000A4 to A6 1,000 2,000 6,000B1 to B2 500 1,000 2,000B3 to B4 200 500 1,000

- Failure to submit prescribed documents and to settle penalty constitutes sufficient ground for suspension and revocation of accreditation after due notice and hearing .

The first to third offenses must have been committed within the period of 4 years computed from the time of the imposition of the penalty for the first offense.

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THANK YOU!