Chapter 1: The Accountancy Profession

1. CPAs are licensed by

 State government
2. How many CPD units are required for accreditation to practice the accountancy
profession?
 120 units
3. What are the three main areas in the practice of the accountancy profession?
 Public accounting, private accounting and government accounting
4. The most common financial attribute used in measuring financial information is
 Historical Cost
5. This accounting process is the recognition or no recognition of business activities as
accountable events.
 Identifying
6. What are the events that affect the entity and in which other entities participate?
 External events
7. All of the following are represented in FRSC, except
 Department of Budget and Management
8. The important points made in the definition of accounting include all of the following,
except
 Accounting information is both quantitative and qualitative
9. Accounting is a service activity. Its function is to provide quantitative information
primarily financial in nature, about economic activities, that is intended to be useful in
making economic decision. This accounting definition is given by
 Accounting Standards Council
10. What is the primary service of CPAs in public practice?
 Auditing
11. What is the body authorized by law to promulgate rules and regulations affecting the
practice of the accountancy profession in the Philippines?
 Board of Accountancy
12. The Philippine Financial Reporting Standards collectively include

 PFRS corresponding to IFRS

 PAS corresponding to IAS
 Philippine Interpretations corresponding to IFRIC and SIC Interpretations and
Interpretations developed by PIC.
13. What is the measuring component in the definition of accounting?
 The assigning of peso amounts to the accountable economic transactions and
events.
14. GAAP is an abbreviation for
 Generally accepted accounting principles
15. A CPA shall be permanently exempted from renewal of CPA license
 At the age of 65 years
16. What is the overall objective of accounting?
 To provide quantitative financial information about an entity that is useful in
making economic decision.
17. Which is incorrect in relation to an accountable event?
 Sociological and psychological matters are quantifiable.
18. Which statement is incorrect in relation to the practice of public accountancy?
 The Securities and Exchange Commission can register any corporation organized
for the practice of public accountancy.
19. Accounting standard-setting has been characterized as
 Political process
20. The communicating process of accounting includes all of the following, except
 Interpreting
21. All of the following describe accounting, except
 An exact science rather than an art
22. What is the law regulating the practice of accountancy in the Philippines?
 RA 9298
23. What is the standard setting body in the Philippines at the present time?
 Financial Reporting Standards Council
24. It is the area of accountancy profession that encompasses the process of analyzing,
classifying, summarizing and communicating all transactions involving the receipt and
disposition of government funds and property and interpreting the results thereof.
 Government accounting
25. Accountants employed in entities in various capacity as accounting staff, chief
accountant or controller are said to be engaged in
 Private accounting