ACC 103: MODULE 1-10

• IFRS


  A set of accounting standards that are recognized by at least 120 countries (including the Philippines) and provides a guide on how particular types of transactions and other events should be reported in the financial statements
• PFRS


  The Philippines' version of the IFRS with some minor modifications
• PAS


  Accounting standards issued by the PFRS Council (formerly the Accounting Standards Council [ASC]), under the oversight of the BOA
• The PFRS and the PAS are the current set of Generally Accepted Accounting Principles (GAAP) in the Philippines
• Public interest entities that must apply the full PFRS

  • Companies with total assets of more than PHP 350,000,000 (approximately US$8,000,000) or total liabilities of more than PHP 250,000,000 (approximately US$6,000,000)
  • Companies whose securities trade in a public market
  • Companies that are in the process of filing their financial statements for the purpose of issuing any class of instruments in a public market
  • Companies that hold secondary licenses issued by regulatory agencies
• SMEs


  Small and medium enterprises that are permitted to use PFRS for SMEs provided that they do not fall into the categories of public interest entities
• Micro-sized entities


  Entities with total assets and liabilities below PHP 3,000,000 (approximately US$70,000) and that are not otherwise required to file financial statements with the SEC, which have the option to use either income tax basis accounting standards or the PFRS for SMEs
• The Bangko Sentral ng Pilipinas (BSP; the Philippines Central Bank) has required all banks to follow PFRS since 2005
• Philippine Interpretations Committee


  Formed by the FRSC in August 2006 to assist in establishing and improving the financial reporting standards in the Philippines, with the role of issuing implementation guidance on the PFRS
• The Philippine Accountancy Act of 2004 stipulates that the Professional Regulatory Board of Accountancy (BOA), which operates under the supervision of the Professional Regulation Commission (PRC), is responsible for the regulation of professional accountants in the Philippines
• Criteria to be eligible to sit for the accountancy licensure examination

  • Be a Filipino citizen
  • Be of good moral character
  • Be 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 the Commission on Higher Education (CHED) or other authorized government offices
  • Not been convicted of any criminal offense
• Responsibilities of the BOA under the Philippine Accountancy Act

  • Supervising the registration, licensing, and practice of accountancy in the Philippines
  • Maintaining a registry of registered and accredited CPAs
  • Issuing and renewing Certificates of Registration and Accreditation
  • Adopting ethical, accounting and auditing standards, taking into consideration international standards and generally accepted best practices
  • Conducting quality assurance (QA) reviews
  • Investigating violations of rules and regulations and issuing sanctions
  • Preparing and issuing the syllabi of the subjects for examinations in consultation with the academe, preparing questions for the licensing examination, and administering and releasing the results of the examinations
  • Ensuring all tertiary educational providers comply with policies and standards prescribed by the CHED
• Responsibilities of the PICPA

  • Promoting and maintaining high professional and ethical standards among accountants by adopting a Code of Ethics for its members as a task delegated by the BOA
  • Developing and improving the accountancy education
  • Protecting the CPA designation
  • Carrying out the fact-finding component of investigations upon the delegation and approval of the BOA and the PRC
• GAAP


  Generally Accepted Accounting Principles
• 3. What are the three main areas in the practice of the accountancy profession?

  • Public accounting, private accounting and managerial accounting
  • Financial accounting, managerial accounting and corporate accounting
  • Auditing, taxation and managerial accounting
  • Public accounting, private accounting and government accounting