Accountancy Standards and Ethics Quiz

The Board can suspend, revoke, or reinstate the certificate for accountants based on their professional conduct.

The Board ensures that accounting education meets set standards by working with CHED, the Commission on Higher Education, or other authorized government institutions. This includes verifying curriculum, teaching staff, library resources, and facilities.

The Board has the power to punish accountants for disobeying the Board's rules and regulations. This is similar to a court's power to punish people for violating the law.

The Board creates and adopts a code of ethics that outlines the ethical principles and guidelines accountants must follow in their practice.

The Board can issue a cease and desist order to individuals, associations, partnerships, or corporations if they are found to be acting against the law, accounting standards, or rules set by the Board.

A candidate must have a Bachelor of Science in Accountancy (BSA) degree recognized by CHED or other authorized government agencies.

A candidate must not have any criminal convictions involving moral turpitude.

A candidate achieving a general weighted average of 75% or higher passes the CPA exam.

A candidate who fails two complete CPA exams is disqualified from taking the exam again.

A candidate who passes four subjects in one sitting with a combined weight of eight units receives conditional credit for those subjects.

A candidate with conditional credit must retake the remaining subjects within two years.

The Board of Accountancy (BOA) may refuse to issue a CPA certificate to a successful candidate for various reasons, including a lack of qualification.

A candidate who fails to pass all subjects within two years after obtaining conditional credit is considered as failing the entire examination.

Auditing fees are determined by factors like risks, complexity, time, responsibility, and client cooperation.

Flat fees charge a fixed amount regardless of actual work done, while per diem or actual hours charge based on time spent. Maximum fees set an upper limit, and retainer basis requires upfront payment.

Offering significantly lower fees than competitors can create a self-interest threat, as the auditor may feel pressure to please the client.

Contingent fees are based on the outcome of a transaction or work, creating potential self-interest and advocacy threats.

When fees are determined by courts or public authorities, they are not considered contingent fees.

Safeguards for pricing threats include ensuring qualified staff and compliance with standards, while contingent fees generally have no safeguards.

The range of possible fee amounts, variability, basis of determination, review by a third party, and effect on the engagement are all important factors to consider with contingent fees.

By law, positions involving financial transactions, statements, and auditor coordination require a registered CPA, if the business has at least P5M paid-up capital or P10M annual revenue.

The AASC promotes auditing standards, practices, and procedures that accountants in the Philippines should follow.

The AASC helps the Board of Accountancy handle disciplinary cases against accountants who have broken the rules.

The AASC researches new accounting and auditing methods to keep up with changing needs, like technology.

The Board of Accountancy is represented in both the FRSC and AASC.

The Bureau of Internal Revenue (BIR) is not represented in either the FRSC or the AASC.

The Board of Accountancy can reinstate a CPA's license under certain conditions after it's been revoked.

The Professional Regulation Commission (PRC) has the power to remove members of the Board of Accountancy in certain cases.

The Board of Accountancy must publish a list of registered CPAs.

A general partnership, limited liability partnership, or sole proprietorship can practice public accountancy, but a corporation cannot practice unless all its stockholders are CPAs.

A surviving partner can continue practicing under the existing firm name, even if it includes the deceased partner's name, for up to five years.

A CPA firm name cannot be misleading or use fictitious names, but it can include past partners' names.

A CPA firm violates the Philippine Accountancy Act if it includes a deceased partner's name for more than five years.

CPAs, firms, and partnerships practicing public accountancy need to register with the Commission and Board every three years before May 31st.

One of the functions of the Board of Accountancy is to supervise the registration, licensing, and practice of accountancy in the Philippines.

The Board of Accountancy can suspend, revoke, or reinstate the certificates of CPAs based on their professional conduct.

The Board of Accountancy works with CHED to ensure accounting education meets standards, examining curriculum, teaching staff, facilities, and library resources.

The Quality Review Committee (QRC) is responsible for evaluating applications for registration as Certified Public Accountants (CPAs) and for recommending the revocation of CPA licenses for violations of quality control. It consists of seven (7) members, including a chairman, each serving a three-year term, renewable once. The QRC is a vital part of the Board of Accountancy's oversight of the accounting profession.

The chairman of the QRC must be a senior practitioner in public accountancy, either currently or in the past. This requirement ensures that the chair has the necessary experience and expertise to lead the committee effectively.

The QRC has five members representing different sectors within the accounting profession: public practice, academe, commerce, government, and the Board of Accountancy. This diversity ensures representation of various perspectives within the profession.

The QRC's main function is to conduct quality reviews (QR) by examining applicants' credentials and recommending action on their registration based on the findings. This ensures that only qualified individuals are granted CPA licenses.

The QRC's other major function is to recommend the revocation of CPA licenses to the Board of Accountancy when a CPA fails to maintain quality control, potentially putting the public interest at risk.

The QRC's review process involves providing direction and supervision to staff involved in the review, developing an overall audit plan and program, setting time budgets, and comprehensively reviewing all aspects of the work before issuing a report. This ensures a thorough and effective review of the work.

The review process is a critical step in ensuring quality control. It involves an objective assessment of the work performed by the engagement team and any relevant documentation. This ensures that all required procedures have been performed correctly and that the engagement team's conclusions are supported by strong evidence.

The QRC review should be conducted by individuals who are independent from the engagement team and possess a level of competence equivalent to or higher than those who performed the work. This ensures that the review is conducted with objectivity and expertise.