Professional Review and

Training Center (PRTC)

Philippine Accountancy
Act of 2004 (RA 9298)
(AT.2521)

Leomar R. Cabarles
 Overview

• Five Articles (Rules)

I. Title, Declaration of Policy, Objective and
Scope of Practice
II. Professional Regulatory Board of
Accountancy (PRBOA or the “Board”)
III. Examination, Registration and Licensure
IV. Practice of Accountancy
V. Penal and Final Provisions

• 44 sections; three annexes

Rule I
– Title, Declaration of
Policy, Objective and
Scope of Practice
 Section 1 – Short Title

• RA No. 9298

• Philippine Accountancy Act of 2004

 Section 2 – Declaration of Policy

• Competent, virtuous, productive and

well rounded CPAs through:

 Licensure examinations

 Professional growth and

development
 Section 3 – Objectives

• Standardization and regulation of

accounting education

• Examination for registration of CPAs

• Supervision, control, and regulation of

practice of accountancy
 Section 4 – Scope of Practice

1. Practice of Public Accountancy

2. Practice in Commerce and Industry

3. Practice in Education/Academe

4. Practice in the Government

 Practice in Commerce and Industry

• Positions held by CPAs only:

 Recording supervision
 F/S preparation
 External auditors coordination

• At least P5M paid-up capital and/or

P10M annual revenue

• No deprivation of incumbents
 Practice in Academe

• Dean or chair of accountancy program

• shall be a CPA
Rule II
– Professional Regulatory
Board of Accountancy
(PRBOA or the “Board”)
Section 5 – Appointment and Composition
 Section 6 – Qualifications

• Natural-born citizen & resident

• CPA with at least 10 years of work experience

• Good moral character and not convicted of

crimes involving moral turpitude

• No interest in SCU offering accountancy or

CPA review schools

• Not an Officer of APO at time of appointment

 Section 7 – Term of Office

• Three years

• Vacancy filled up for unexpired portion

only (not considered a complete term)

• After two successive complete terms,

no reappointment until lapse of one year

• Not exceed 12 years

Section 8 – Compensation and Allowances

• Comparable to other PRC regulatory

boards

• based on GAA
 Section 9 – Powers and Functions

1. Prescribe rules and regulations

2. Supervise the registration, licensure

and practice of accountancy

3. Administer oaths

4. Issue, suspend, revoke, or reinstate the

Certificate of Registration

5. To adopt an official seal

 Section 9 – Powers and Functions

6. Prescribe a Code of Ethics

7. Monitor conditions of accountancy

practice (measures, standards, rules
and regulations and best practices)

8. Oversight into the quality of F/S audits

9. Investigate violations

10.Issue a cease or desist order

 Section 9 – Powers and Functions

11.Punish for contempt

12.Prepare or amend examination syllabi

13.Ensure that schools comply with the

requirements of CHED

14.Other necessary powers

Require approval of PRC, except

administrative cases
 Section 9 (A) – AASC and FRSC
FRSC AASC
1. Chairman (FRSC: Any sector; AASC: Public Accountancy) 1 1
2. Board of Accountancy 1 1
3. Securities and Exchange Commission 1 1
4. Bangko Sentral ng Pilipinas 1 1
5. Commission on Audit 1 1
6. Bureau of Internal Revenue 1
7. FINEX 1
8. An association of CPAs in public practice 1
APO (PICPA):
9. Public Practice (AASC: Small, medium & big prac.) 2 6
10. Commerce and Industry 2 1
11. Academe/Education 2 1
12. Government 2 1
Total 15 15

• Three years, renewable for another term

Section 9 (B) – Education Technical Council

ETC
1. Chairman 1
2. Board of Accountancy 1
APO (PICPA):
3. Public Practice 1
4. Commerce and Industry 1
5. Academe/Education (Public & Private) 2
6. Government 1
Total 7

• Three years, renewable for another term

Section 10 – Administrative Supervision…

• Under PRC

• All records of the Board under the

custody of PRC

• The PRC shall designate the Secretary

of the Board
 Section 11 – Suspension and Removal

• Neglect of duty or incompetence

• Violation (or tolerance thereof) of RA, Ethics,
and professional standards
• Final judgment of moral turpitude crimes
• Manipulation of CPA exam. results, disclosure
of confidential info. or tampering of grades

Under the power of the President

(recommendation of PRC)
 Section 12 – Annual Report

• At the close of each calendar year

• BOA submits an annual report to the

President through the PRC

• Show activities, accomplishments, and

recommendations
Rule III -
Examination,
Registration and
Licensure
 Section 13 – The CPA Examinations

• Given by the Board

• Places/venues and dates fixed by PRC

 Section 14 – CPA Exam Qualifications

• Filipino citizen

• Good moral character

• Holder of BSA degree

• Not convicted of any criminal offense

involving moral turpitude
 Section 15 – Scope of CPA Exam

May be changed by BOA (PRC approval)

not be more often than every 3 years
 Section 16 – Rating in the CPA Exam

• Passed: GA = 75%; no <65% any subject

• Conditioned: at least 75% in at least

majority of subjects (remaining subjects
to be taken within two years)

• Failed: GA = lower than 75%; lower than

65% in each of the subjects
Rating in the CPA Exam: Illustration
 Section 17 – Report of Ratings

• Within ten (10) calendar days after the

examination (BOA through PRC)

• By mail or during oath taking (PRC)

 Section 18 – Refresher Course

• Two (2) complete failed examinations

• Completion at least 24 units of subjects

given in the licensure examination.

Conditional + Removal
=
One Examination
 Section 19 – Oath

• Required prior to entering into the

profession

• Before BOA or PRC or by law -

authorized government official
 Section 20 – COR and PIC

• COR = Signature of PRC Chairperson

and BOA, with their official seals

• PIC = registration number, date of

issuance, expiry date, duly signed by
the chairperson of the Commission
(valid for three years)
 Section 21 – Roster of CPAs

• Shows names and place of business of

all registered CPAs

• May be delegated to PICPA

Section 22 – Indication of COR, PIC, & PTR

• Signed documents connected with

profession

• Indicate:
 Numbers
 Date of issuance
 Validity
 Section 23 – Refusal of COR & PIC

Except for political offense or non-

disqualifying offense:

• Criminal offense with moral turpitude

• Immoral and dishonorable conduct

• Unsound mind

• Exam application misrepresentation

Sec. 24 – COR&PIC Suspension/Revocation

• Grounds under Section 23

• Unprofessional or unethical conduct,

malpractice, violation of RA No. 9298,
Code of Ethics and professional
standards
Section 25 – Reinstatement, Reissuance…

• Two years from revocation date, subject

to BOA’s decision

• A new CoR to replace lost, destroyed, or

mutilated Certificate may be issued
Rule IV –
Practice of
Accountancy
 Section 26 – Prohibition in Practice

• Use “Certified Public Accountant” or

“CPA”

• Without COR and PIC or valid

temporary/special permit
 Section 27 – Vested Rights of CPAs

• CPAs registered at the time this law

takes effect

• Automatically be registered, subject to

future requirements.
 Section 28 – Public Practice Limitation

• Public practitioners = Registered CPAs

• Certificate of Accreditation = Minimum

of three years meaningful experience

• Partnerships = General or limited

liability

• No corporation
 Section 28 (A) – Meaningful Experience

• Commerce and industry – Significant

involvement accounting, tax, internal
auditing, liaison with external auditors

• Academe/education – Teaching at least

three trimesters or two semesters
accounting related subjects,
accumulated not be less than three
school years
Section 28 (A) – Meaningful Experience

• Government - Significant involvement

in accounting, budgeting, tax, internal
auditing, liaison with COA

• Public practice - At least one year as

audit assistant and at least two years
as auditor in charge of audit
engagement covering full audit
functions of significant clients
Section 29 – Ownership of Working Papers

• CPA’s, in absence of written agreement

• Confidential and privileged

• Unless required to be produced by court

or government body
Section 30 – Accredited Professional Org.

• Known as the PICPA

• SEC-registered non-profit corporation

• Recognized by BOA and PRC on

10/2/1975 per Acc. No. 15. Certificate of
Accreditation (CoA) once every three
years.
Section 31 – Accreditation to Public Prac.

• Individual CPAs, firms and

partnerships, including the partners
and staff members

• Death, disability, dissolution and

liquidation = Report to BOA within 30
days
 Annex B – Name of Practice

TYPE BASIS EXAMPLE

Individual BOA and PRC “Juan de la Cruz,
CPA Registered CPA”
Name
“Juan de la Cruz
Firms DTI Registered and Associates”
Name
“Cruz, Isidro,
Partnerships SEC Registered Martin, and
Name Company"
 Annex B – Name of Practice

• Not allowed names:

 Fictitious
 Indicates specialization
 Misleading as to organization type

• Partnership name allowed not more

than two years after becoming a sole
proprietor
Annex B – Quality Review Committee (QRC)

• Quality review public practice applicants

• Recommends to BOA revocation of COR

and PIC

• Appointed by PRC, recommended by

BOA in coordination with the PICPA

• Three years term renewable for another

Annex B – Quality Review Committee (QRC)

1. Chairman 1
2. Board of Accountancy 1
APO (PICPA):
3. Public Practice 2
4. Commerce and Industry 1
5. Academe/Education 1
6. Government 1
Total 7
Section 32 – Continuing Professional Dev.

• 120 CPD credit units for three years,

minimum of 20 CPD credit units each
year

• Excess credit units not carried over,

except doctoral and master’s degrees
and other specialty trainings
 PRC CPD Council

1. Chairperson (BOA) 1
2. 1st Mem (Officer of PICPA) 1
3. 2nd Mem (Academician) 1
Total 3
 Exemptions from CPD

• Overseas employment

• Medical reasons

• Natural calamity

• Financially handicapped/Unemployed
 Annex “C” – Sanctions to CPAs

• Not allowed to renew licenses

• Delinquent for non-renewal of licenses

for a period of five continuous years
 Section 33 – Seal and Use of Seal

• Prescribed by BOA bearing the name,

registration number and title

• Auditor’s reports shall be stamped with

seal and PTR number

• Seal and signature indicates accounting

and auditing standards compliance
Section 33 – Seal and Use of Seal
 Section 34 – Foreign Reciprocity

• Foreign CPAs under international treaty

• Subject to application and documentary

requirements
 Section 35 – Temporary/Special Permits

• Consultation (no Filipino CPA qualified)

• Professor or lecturer

• Internationally expert essential for

advancement of accountancy
Rule V –
Penal and Final
Provisions
 Section 36 – Penal Provisions

• Not less than P50,000

• Imprisonment not exceeding two years

• Both
 Section 37 – IRR

• Within 90 days after the effectivity of RA

No. 9298

• Effective 15 days following publication

 Section 38 – Interpretation

• Not prevent practice of other legally

recognized profession
 Section 39 – Enforcement

• Primary duty = PRC and BOA

• Other government agencies

• Secretary of Justice = legal adviser

 Section 40 – Funding Provision

• Based on General Appropriations Act

(GAA)
 Section 41 – Transitory Provision

• All graduates with a Bachelor’s Degree,

major in Accounting

• shall be allowed to take the CPA

Licensure Examination

• within two (2) years (or until May 2006)

 Section 42 – Separability Clause

• unconstitutional or invalid parts

• not affect other parts

 Section 43 – Repealing Clause

• Any rule and regulation inconsistent

with this IRR

• are hereby repealed or modified

 Section 44 – Effectivity

• IRR = September 2004

• Within 90 days from the effective date of

RA 9298

• Took effect fifteen (15) days following

publication
Accountancy Practice
-now do the DIY drill-
 DIY Drill Answers

1. C
2. C
3. A
4. B
5. B
 DIY Drill Answers

6. D
7. B
8. A
9. B
10. A
 DIY Drill Answers

11. C
12. C
13. C
14. A
15. D
 end of AT.2521 