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    The Accountancy Profession

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    Beverly Urbase

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    © All Rights Reserved
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    The Accountancy Profession

    Uploaded by

    Beverly Urbase
    7 views3 pages

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    Copyright:

    © All Rights Reserved
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    7 views3 pages

    The Accountancy Profession

    Uploaded by

    Beverly Urbase

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
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    THE ACCOUNTANCY PROFESSION

    Accounting
    ASC: Accounting is a service activity.
    AICPA: Accounting is the art of recording, classifying, and summarizing in a significant manner.
    AAA: Accounting is a process of identifying, measuring, and communicating economic information.
    1. Quantitative information
    2. Financial in Nature
    3. Useful in decision making
    Components
    a. Identifying as analytical component
    b. Measuring as technical component
    c. Communicating as formal component
    Identifying: The recognition or non-recognition of business activities, whether it is “accountable”.
    Only event with an effect in asset, liabilities, and equity will be recognize.
    Economic Activities: The transactions that can be classified into;
    a. External Transaction: Involves an entity and another entity
    b. Internal Transaction: Involves only an entity
    Measuring: Assigning peso amounts to the accountable transactions.
    Communicating: Process of preparing and distributing the accounting reports, and the reason why
    accounting called “the universal language of business”.
    Recording: Journalizing, and the process of systematically maintaining a record of all business
    transactions.
    Classifying: Sorting of similar and interrelated transactions at their respective classes.
    Summarizing: Preparation of Financial Statements
    Republic Act. No. 9298: Law regulating practice of accountancy in the Philippines, “The Philippine
    Accountancy Act. Of 2004”.
    To practice the accountancy profession:

    ● Must finish the degree of BS Accountancy.


    ● Pass the government examination given by BOA
    BOA: Body authorized by law to promulgate rules and regulations affecting the practice of the
    accountancy profession in the Philippines.
    Limitation of the Practice of Public Accountancy

    ● Single practitioners and partnership shall be registered CPA in the Philippines


    ● Certificate of Accreditation shall be issued to CPA, only upon showing in accordance with
    the rules of BOA
    ● Had a 3-year meaningful experience
    ● SEC shall not register any corporation for the practice of accountancy
    Accreditation to practice Public Accountancy

    ● Certificate of Registration is valid for 3 years and renewable every 3 years upon payment of
    required fees.
    Areas of the Profession
    Public Accounting: Composed of individual practitioners, small accounting firms and large
    multinational organizations that render independent and expert financial services to the public.

    ● Auditing: The primary service offered, examine the financial statements of CPA for the
    purpose of expressing an opinion as to the fairness.
    ● Taxation Service: Includes the preparation of annual income tax and determination of tax.
    ● Management Advisory Service: It has no precise coverage, refers to the service to the clients
    on matters of accounting, finance, organizations, etc.
    Private Accounting: To assist management in planning and controlling the entity's operations.
    Employed in various capacity as accounting staff, chief accountant, internal auditor, and controller
    (the highest accounting officer).
    Government Accounting: Involves in the government funds, property, and interpreting thereof.
    Sectors of the Profession
    Commerce and Industry: Area of private accounting.

    ● Association of Certified Public Accountants in Commerce and Industry (ACPACI)


    Public Practice: Area of public accounting

    ● Association of Certified Public Accountants in Public Practice (ACPAPP)


    Government: Area of government

    ● Government Association of Certified Public Accountants (GACPA)


    Education/Academe: private and public education institutions for instruction and research function.

    ● National Association of Certified Public Accountants in Education (nACPAE)


    Continuing Professional Development
    CPD: Refers to the hours or unit required for the renewal of CPA License.

    ● Every 3 years
    ● 15 CPD for the renewal of license
    ● 120 CPD for the renewal of accreditation
    ● Exemption: permanently exempted at the age of 65, but only the license not for the practice
    of accountancy.
    GAAP: represent the "rules, procedures, practice and standards followed in the preparation and
    presentation of financial statements."
    PFRS: The Financial Reporting Standards Council issues its standards in a series of Pronouncements
    called "Philippine Financial Reporting Standards" or PFRS.

    ● PFRS correspond to IFRS


    ● PAS correspond to IAS
    ● PI correspond to Interpretation of IFRIC and SIC, and interpretation develop by PIC
    Purpose: To identify the proper accounting practices for the preparation and presentation of financial
    statements.
    FRSC: The accounting standard body created by PRC to assist the BOA in carrying out its powers
    and functions.

    ● FRSC now replaces the ASC


    ● To establish and improve accounting standard that will be generally accepted in the Ph.
    ● Constitute the “highest hierarchy” of GAAP in the Philippines.
    PIC: It was formed by the FRSC in August 2006 and has replaced the IC formed by ASC in May 2002.

    ● Role: Prepared interpretations of PFRS for approval of FRSC and in the context of Conceptual
    Framework, to provide timely guidance on financial reporting issues not specifically
    addressed in the current PFRS.
    ● Intended to give "authoritative guidance". on issues that are likely to receive divergent or
    unacceptable treatment because the standards do not provide specific and clearcut rules
    and guidelines.
    IASC: Independent private sector, with the objective of achieving uniformity in the accounting
    principles for financial reporting around the world.

    ● Formed in June 1973


    ● Headquartered in London
    Objectives:
    a. Formulate and publish in the public interest accounting standards.
    b. To work for the improvement and harmonization of regulations.
    IASB: publishes its standards in a series of pronouncements called. "International Financial Reporting
    Standards" or IFRS.

    ● Now replaces the IASC


    ● Has adopted the body standards issued by the IASC.
    Accredited Professional Organization

    ● Philippine Institute of Certified Accountants or PICPA is the accredited professional


    organization (APO) of CPAs by the Professional Regulation Commission (PRC).

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