The CPAs Professional Responsibility

RA 9298
1. The objectives of the Philippine Accountancy Act of 2004 are the following, except:
a. Standardization and regulation of accounting education.
b. Integration of accountancy profession.
c. Examination for registration of certified public accountants.
d. Supervision, control and regulation of the practice of accountancy.

2. Practice of Public Accountancy shall constitute in a person:
a. When involved in decision making requiring professional knowledge in the science of accounting, as well as the accounting aspects of
finance and taxation.
b. When he/she is appointed 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
c. When he or she is involved in teaching of accounting, auditing, management advisory services, accounting aspect of finance, business
law, taxation and other technically related subjects.
d. When a person is skilled in the knowledge, science and practice of accounting and as a qualified person to render professional services
as a CPA

3. Any position in any business or company in the private sector which requires supervising the recording of financial transactions,
preparation of financial statements, coordinating with the external auditors for the audit of such financial statements and other related
functions shall be occupied only by a duly registered CPA. Provided
I. That the business or company where the above position exists has a paid-up capital of at least P5,000,000 and/or annual revenue of
at least P10,000,000
II. The above provision shall apply only to persons to be employed after the effectivity of the Implementing Rules and Regulations of
RA 9298
III. The above provision shall not result to deprivation of the employment of incumbents to the position

a. I, II and III c. II and III
b. I and II d. I and III

4. The following statements relate to the Board of Accountancy. Which statement is incorrect?
a. The Board consists of a Chairman and six members
b. The Chairman and members are appointed by the President of the Philippines upon recommendation of PRC
c. No person shall be appointed a member of the Board unless he is a natural-born citizen of the Philippines, a duly registered CPA
and has been in the practice of accountancy for at least ten years
d. The Professional Regulation Commission may remove from the Board any member whose certificate to practice has been removed
or suspended

5. The APO shall submit its nominations with complete documentation to the Commission not later than _____ prior to the expiry of
the term of an incumbent chairman or member.
a. 30 days c. 90 days
b. 60 days d. 120 days

6. Which of the following is incorrect regarding the qualifications of members of the Board of Accountancy?
a. Must be a natural-born citizen and resident of the Philippines
b. Must be a duly registered Certified Public Accountant with at least fifteen (15) years of work experience in any scope of practice of
accountancy
c. Must be of good moral character and must not have been convicted of crimes involving moral turpitude
d. Must not have any pecuniary interest, directly or indirectly, in any school, college, university where review classes in preparation
for the licensure examination are being offered or conducted

7. Which of the following statements is incorrect according to Section 7 of the Philippine Accountancy Act of 2004 (RA 9298)?
a. The Chairman and the members of the Professional Regulatory Board of Accountancy (PRBOA) shall hold office for a term of
three (3) years.
b. No person who has served two (2) successive terms shall be eligible for reappointment until the lapse of one (1) year.
c. Any vacancy occurring within the term of a member shall be filled up for the unexpired portion of the term only.
d. Appointment to fill up an unexpired term is considered as a complete term.

8. No person shall serve the Professional Regulatory Board of Accountancy for more than
a. 3 years c. 9 years
b. 6 years d. 12 years




9. The Board shall exercise the following specific powers, functions and responsibilities:
A. B. C. D.
To supervise the registration,
licensure and practice of
accountancy Yes Yes Yes Yes

To issue, suspend, revoke, or
reinstate the Certificate of
registration for the
practice of accountancy Yes No Yes Yes

To monitor the conditions
affecting the practice of
accountancy Yes Yes No Yes

To conduct an oversight
into the quality of audits of
financial statements Yes No Yes No

To coordinate with CHED Yes Yes No Yes

10. A study, appraisal, or review by the BOA or its duly authorized representatives, of the quality of audit of financial statements
through a review of the quality control measures instituted by an Individual CPA, Firm or Partnership of CPAs engaged in the practice
of public accountancy.
a. Peer review c. Analytical review
b. Quality review d. Administrative review

11. The following were created to assist the BOA in carrying out its powers and functions, except
a. Auditing and Assurance Standards Council c. Education Technical Council
b. Financial Reporting Standards Council d. Accredited National Professional Organization of CPAs

12. The creation of FRSC and AASC is intended to assist the BOA in carrying out its function to
a. To monitor the conditions affecting the practice of accountancy and adopt such measures, rules and regulations and best practices as
may be deemed proper for the enhancement and maintenance of high professional, ethical, accounting and auditing standards.
b. To supervise the registration, licensure and practice of accountancy in the Philippines.
c. To prescribe and adopt the rules and regulations necessary for carrying out the provisions of RA 9298.
d. To prepare, adopt, issue or amend the syllabi of the subjects for examinations.

13. Which of the following is not a ground for suspension or removal of members of BOA?
a. Neglect of duty or incompetence c. Final judgment of crimes, involving moral turpitude
b. Intolerance of any violation of the Act d. Rigging of the certified public accountant licensure examination results

14. Which of the following is not a requisite in applying for the CPA licensure examinations?
a. At least 18 years old. c. Holder of the degree of Bachelor of Science in Accountancy.
b. Good moral character. d. Has not been convicted of any criminal offense involving moral turpitude.

15. The Board, subject to the approval of the Commission, may revise or exclude any of the subjects and their syllabi, and add new
ones as the need arises. Provided that the change shall not be more often than every
a. 2 years c. 4 years
b. 3 years d. 5 years

16. The following statements relate to CPA examination ratings. Which statement is incorrect?
a. To pass the examination, candidates should obtain a general weighted average of 75% and above, with no rating in any subject less
than 65%.
b. Candidates who obtain a rating of 75% and above in at least four subjects shall receive a conditional credit for the subjects passed.
c. Conditioned candidates shall take an examination in the remaining subject within three years from the preceding examination.
d. Candidates who fail in two (2) complete CPA examinations may be allowed to take examinations a third time provided he or she
will comply with Sec. 18 of this Act.

17. The Board shall submit to the Commission the ratings obtained by each candidate within ten (10) calendar days after the
examination, unless extended for just cause.
Any candidate who fails in two (2) complete Certified Public Accountant Board Examination shall be disqualified from
taking another set of examinations unless he/she submits evidence to the satisfaction of the Board that he/she enrolled in and
completed at least twenty-four (24) units of subject given in the licensure examination.
a. True, True c. False, False
b. True, False d. False, True
18. According to Section 20 of the Philippine Accountancy Act of 2004 (RA 9298), a Professional Identification Card bearing
the registration number, date of issuance, expiry date, duly signed by the chairperson of the PRC, shall likewise be issued to every
registrant renewable every
a. one (1) year c. three (3) years
b. two (2) years d. five (5) years

19. The BOA shall refuse the registration of any person who successfully passed the CPA examinations if
a. Convicted by a court of competent jurisdiction of a criminal offense involving moral turpitude
b. Having an unsound mind
c. Guilty of immoral and dishonorable conduct
d. All of the following are grounds for refusal

20. A CPA whose certificate have been revoked may be reinstated if he has acted in exemplary manner and has not committed any
illegal, immoral or dishonorable conduct for a period not less than
a. One year c. Five years
b. Two years d. The period depends on the seriousness of his offense

Revised Code of Ethics
PREFACE
1. Which statement is incorrect regarding the Code of Ethics for Professional Accountants in the Philippines?
a. Professional accountants refer to persons who are Certified Public Accountants (CPA) and who hold a valid certificate issued by the
Board of Accountancy.
b. Where a national statutory requirement is in conflict with a provision of the IFAC Code, the IFAC Code requirement prevails.
c. The Code of Ethics for Professional Accountants in the Philippines is mandatory for all CPAs and is applicable to professional
services performed in the Philippines on or after June 30, 2008.
d. Professional accountants should consider the ethical requirements as the basic principles which they should follow in performing
their work.

INTRODUCTION
2. A profession is distinguished by certain characteristics including
I. Mastery of a particular intellectual skill, acquired by training and education
II. Adherence by its members to a common code of values and conduct established by its administrating body, including maintaining
an outlook which is essentially objective.
III. 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)

a. I, II and III c. III only
b. I and II only d. II and III only

THE PUBLIC INTEREST
3. How did the Code of Ethics define public interest?
a. A distinguishing mark of a profession is acceptance of its responsibility to the public.
b. The accountancy professions public consists of clients, credit grantors, governments, employers, employees, investors, the business
and financial community, and others who rely on the objectivity and integrity of professional accountants.
c. The collective well-being of the community of people and institutions the professional accountant serves.
d. The standards of the accountancy profession are heavily determined by the public interest.

THE CODE
4. Which statement is incorrect regarding the Code of Ethics for Professional Accountants in the Philippines?
a. The objectives as well as the fundamental principles are of a general nature and are not intended to be used to solve a professional
accountants ethical problems in a specific case.
b. The code is divided into two parts, part A and part B
c. Part A refers to general applications
d. Part B applies only to those professional accountants in public practice.

PART A: GENERAL APPLICATION OF THE CODE

Section 100 Introduction and Fundamental Principles
5. In order to achieve the objectives of the accountancy profession, professional accountants have to observe a number of prerequisites
or fundamental principles. The fundamental principles include the following, except
a. Objectivity c. Confidentiality
b. Professional competence and due care d. Confidence

6. Which of the following is not explicitly referred to in the Code of Ethics as source of technical standards?
a. Commission of Audit (COA) c. Securities and exchange Commission (SEC)
b. Auditing standards and Assurance Council (AASC) d. Relevant legislation




7. Professional accountants may encounter problems in identifying unethical behavior or in resolving an ethical conflict.
When faced with significant ethical issues, professional accountants should do the following, except
a. Follow the established policies of the employing organization to seek a resolution of such conflict.
b. Should not consult with those charged with governance of the organization, such as the board of directors or the audit committee.
c. If a significant conflict cannot be resolved, a professional accountant may wish to obtain professional advice from the relevant
professional body or legal advisors, and thereby obtain guidance on ethical issues without breaching confidentiality
d. If, after exhausting all relevant possibilities, the ethical conflict remains unresolved, a professional accountant should, where
possible, refuse to remain associated with the matter creating the conflict.

8. When initiating either a formal or informal conflict resolution process, a professional accountant should consider the following,
either individually or together with others, as part of the resolution process
a. Relevant facts c. Fundamental principles related to the matter in question
b. Ethical issues involved d. All of the above

Section 110 Integrity and Section 120 Objectivity
9. Which of the following statements is (are) correct about objectivity and integrity?
a. The principle of integrity imposes the obligation on all professional accountants to be straightforward and honest in professional and
business relationships. Integrity also implies fair dealing and truthfulness.
b. The principle of objectivity imposes an obligation on all professional accountants not to compromise their professional or business
judgment because of bias, conflict of interest or the undue influence of others.
c. a and b
d. neither a nor b

10. A professional accountant should not be associated with reports, returns, communications or other information that
a. Contains a false or misleading statement
b. Contains statements or information furnished recklessly or without any real knowledge of whether they are true or false.
c. Omits or obscures information required to be submitted and such omission or obscurity would be misleading.
d. All of the above

Section 130 Professional competence and due care
11. Which of the following is incorrect regarding professional competence?
a. Professional accountants may portray themselves as having expertise or experience they do not possess.
b. Professional competence may be divided into two separate phases.
c. The attainment of professional competence requires initially a high standard of general education.
d. The maintenance of professional competence requires a continuing awareness of development in the accountancy profession.

12. Which of the following is the least required in attaining professional competence?
a High standard of general education.
b. Specific education, training and examination in professionally relevant subjects.
c. Period of meaningful work experience.
d. Continuing awareness of development in the accountancy profession.

Section 140 Confidentiality
13. Which of the following is incorrect regarding confidentiality?
a. Professional accountants have an obligation to respect the confidentiality of information about a clients or employers affairs
acquired in the course of professional services.
b. The duty of confidentiality ceases after the end of the relationship between the professional accountant and the client or employer.
c. Confidentiality should always be observed by a professional accountant unless specific authority has been given to disclose
information or there is a legal or professional duty to disclose.
d. Confidentiality requires that a professional accountant acquiring information in the course of performing professional services
neither uses nor appear to use that information for personal advantage or for the advantage of a third party.

14. A professional accountant has a professional duty or right to disclose confidential information in each of the following, except
a. To comply with technical standards and ethics requirements
b. To disclose to BIR fraudulent scheme committed by the client on payment of income tax.
c. To comply with the quality review of a member body or professional body
d. To respond to an inquiry or investigation by a member body or regulatory body.

Section 150 Professional Behavior
15. In marketing and promoting themselves and their work, professional accountants should
a. Not use means which brings the profession into disrepute
b. Not make exaggerated claims for the services they are able to offer, the qualifications they possess, or experience they have gained.
c. Not make disparaging references or unsubstantiated comparisons to the work of others
d. All of the above.