Accountancy in the Philippines

It was recognized on March 17, 1928 under Act No. 3105 “An Act Regulating the
Practice of Public Accounting; Creating the Board of Accountancy; Providing for
Examination, for the Granting of Certificates, and the Registration of Certified Public
Accountants; for the Suspension or Revocation of Certificates; and for Other Purposes

Notable Certified Public Accountants in the Phillippines

- Don Vicente Fabella, first Filipino CPA in the USA (1915)
- Dr. Nicanor Reyes, founder of Far Eastern University
- Belen Enrile-Gutierrez, first Filiina CPA
- Jaime Hernandez and Paciano Dizon, first and second Auditor Generals on
Commission on Audit
- Manuel Villar, former Senator
- Wahington Sycip, founder of SGV & Co.
- Jose Diokno, former Senator and DOJ Secretary
- Wenceslao Lagumbay, former Senator
- Alberto Romulo, Former Senator and DFA Secretary

Accountancy Act of 2004 or Republic Act of 9298

Scope of practice
1. Public Accountancy. This sector refers to the CPAs whose involve in providing
assurance services to clients. They are more often into the field of auditing.
2. Commerce and Industry. This sector refers to the CPAs who work in private
companies.
3. Education/Academe. This sector refers to the CPAs who are teaching accounting
subjects on tertiary level or graduate studies.
4. Government. This sector refers to the CPAs who are working in the government,
national agencies and other instrumentalities.

Professional Regulatory Board of Accountancy is composed of a chairman and six

members appointed by the President of the Philippines from a list of recommended
submitted by PICPA. The chairman shall preside in all meetings of the Board and in the
event of vacancy, the vice-chairman shall assume such duties and responsibilities until
a chairman is appointed. They oversee the conduct of accountancy practice in the
Philippines. Listed below are the qualifications for PRBOA officers.
- Natural born citizen and resident of Philippines
- Duly registered CPA with 10 years’ work experience
- Good moral character and not been convicted of crimes involving moral
turpitude
- Must not have any interest in any accountancy schools or review classes
- Must not be a director or officer of PICPA
Qualifications of Applicants for CPA Examinations
a. Filipino citizen (PSA Birth certificate photocopy and original, and marriage
certificate for married female)
b. Good moral character
c. Holder of BSA degree (diploma and TOR photocopy and original)
d. Not convicted in any criminal offense involving moral turpitude ( NBI clearance)

Scope of Examinations
1. Financial Accounting and Reporting
2. Advanced Financial Accounting and Reporting
3. Management Advisory Services
4. Taxation
5. Regulatory Framework for Business Transactions
6. Auditing

Rating
A candidate must obtain a general weighted average of 75% with no grades lower than
65% in any subject. If a candidate obtained average of 75% but with one or two subjects
lower than 65%, he/she is given a conditional credit. He/she must retake the subjects
he/she failed and meet the 75% threshold. A candidate who fails two complete CPA
board exams shall be disqualified from taking another set of examination unless he/she
submits evidence to the satisfaction of the Board that he/she enrolled 24 units of
subjects in the CPA exam

*** Lately, PRBOA is considering to have a computerized CPA Licensure Examination

in the near future.

Professional Organization
The Philippine Institute of certified Public Accountants (PICPA) is the integrated national
professional organization of CPAs in the Philippines accredited by BOA and PRC.
- Protect and enhance the credibility of CPA certificate in the public service
- Maintain high standards in accounting education
- Instill ideals of professionalism, ethics and competence among accountants
- Foster unity and harmony among members
-
Accounting Standards in the Philippines

Accounting Standards Council(ASC). PICPA created ASC to establish and improve

accounting standards that will be generally accepted in the Philippines. It was supported
by SEC, BSP, PRC and FINEX.
Financial Reporting Standards Council. (FRSC). It is the accounting standard setting
body.
Core Competencies Framework for Accountants
1. Knowledge
a. General knowledge
- Competency in the English language
- Adaptability to Western business practices
- Level of trainability
- Good capabilities in dealing with foreign partners
b. Organizational and business knowledge
- Administrative capability and efficiency
- Decision modelling
- Risk analysis and management
- Measurement
- Industry and sector perspective
c. Information technology knowledge
d. Accounting knowledge
2. Skills
a. Intellectual
- Analysis
- Problem solving
- Technical skills
b. Interpersonal
- Being a team player
- Persuasion, confidence and diplomacy
- Discreetness, open mind and patience
- Capability for work and ability to respond well to pressure
c. Communication
- Verbally and/or written explain results as a level appropriate to the audience
- Ask clear, concise and relevant questions to obtain desired information to
perform a task
- Negotiate effectively
3. Values
a. Professional ethics
b. Moral values

Ethics is concerned with right and wrong and how conduct should be judged to be good
or bad. Business ethics tells what is right or wrong in a business situation. Professional
ethics tells the same thing about the profession. Ethical dilemma is a situation in which
there is no obvious right or wrong decision but rather a right answer. Listed on the next
page are some of the ethical dilemmas a CPA may face:
- White collar crime. Using the position for fraud and theft
- Whistle-blowing. CPAs reporting to authority about the wrongdoings of a
company
- Conflicts of interests. A CPA has personal interest conflicting with his role in a
company
- Fiduciary responsibilities. CPA serves as confidant of its client.
 - Sexual harassment. Aggressive sexual commentary and advances toward
another person
- Discrimination. Prejudicing someone base on its race, religion, ethnicity,
gender, age, marital status, and etc.

Code of Ethics for Professional Accountants

It was approved by the Board of Directors of PICPA in relation to the mandate of
International Federation of Accountants (IFAC), international body representing all the
major accountancy bodies across the world.

Fundamental Principles
1. Integrity. It implies fair dealing and truthfulness
2. Objectivity. Not allow bias, conflict of interest or undue influence of others to
override professional or business judgments.
3. Professional Competence and Due Care. Responsibility to act in accordance with
the requirements of the profession.
4. Confidentiality. Not disclose any information to third parties without proper
authority unless there is a legal or professional right to do so.
5. Professional behaviour. Comply with relevant laws and regulations and should
avoid any action that discredits the profession

Branches of Accounting
1. Auditing is an examination that ensures the fairness and reliability of the reports
that management submits to users outside the business entity.
2. Bookkeeping is a mechanical task involving the collection of basic financial data.
3. Cost bookkeeping is the process that involves the recording of cost data in books
of accounts. Cost accounting make use of those data once they have been
extracted from the cost book in providing information for managerial planning and
control
4. Financial accounting is focused on the recording of business transactions and
the periodic preparation of reports on financial positions and results of
operations.
5. Financial management sets financial objectives, making plans based on those
objectives, obtain the finance needed to achieve the plans and generally
safeguarding all the financial resources of the entity.
6. Management Accounting incorporates cost accounting data and adapts them for
specific decisions which management may be called upon to make
7. Taxation includes preparation of tax returns and the consideration of tax
consequences of proposed business transactions or alternative courses of action
8. Government accounting is concerned with the identification of the sources and
uses of resources consistent with the provisions of government laws.
 Enrichment:

There are certain requirements an individual must possess before he become a CPAs.
Our institution, CSTC also share the responsibility of ensuring that aspiring accountants
are equipped with the adequate knowledge, skills and attitudes an accountant should
have. In this regard, the School of Business and Accountancy, through its Program
Head of BSA program devised an admission and retention policy. Now that you have
known what is expected from you as an accountant, kindly read the policy on the next
page. If you are interested in pursuing the Bachelor of Science in Accountancy program,
kindly read its content laboriously. Have it signed by you and your parent as part of our
agreement to uphold the accountancy education standards in CSTC. For those who are
not interested, you are not obliged to sign the paper.
I have read the admission and retention policy and I understand that I have to comply with the guidelines
set by this policy. I am fully aware of the consequences of non-compliances with the abovementioned
requirements and expectations.

________________________________ ______________________________________
Signature over Printed Name of Student Signature over Printed Name of Parent/Guardian
Date:__________________________ Date:___________________________
 References

 Ballada, Win Lu (2019). Basic Financial Accounting and Reporting Made Easy.
DomDane Publisher. Manila Philippines
 Cabrera, Ma. Elenita (2018). Financial accounting and Reporting. GIC
Enterprises &Co. Inc. Manila Philippines
 Valencia, Edwin (2015). Basic Accounting. Valencia Educational Supplies Baguio
City Philippines