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I. To merit public trust and confidence, the professional person must convince the
public that he will place public service ahead of personal reward.
II. A CPA certificate is evidence of basic competence in the discipline of accounting at
the time the certificate is granted.
III. A code of professional conduct is one of the most important distinguishing
characteristics of a profession.
The government agency tasked by law of implementing and enforcing the regulatory policies of
the national government with respect to the regulation and licensing of the various professions
and occupations under its jurisdiction is
SEC
PRC
BOA
COA
To promulgate auditing standards, practices and procedures that shall be generally accepted
by the accounting profession in the Philippines
To undertake continuing research on both auditing and financial accounting in order to make
them responsive to the needs of the public
To assist the Board of Accountancy in conducting administrative proceedings on
erring CPAs in audit practice
To monitor full compliance by auditors to PSAs
In the absence of pronouncements issued by the AASC and the PICPA, published statements
and guidelines issued by other authoritative bodies like AICPA, IAASB and AFA are the bases
of determining generally accepted auditing standards (GAAS). What effect do these
pronouncements provide in determining the GAAS?
Parallel
Alternative
Persuasive
Authoritative
The chairman and members of the AASC shall have a non-renewable term of 3 years
The chairman and members of the AASC shall be appointed by the President of the Philippines upon the
recommendation of PRC
The AASC shall be composed of 15 members plus a Chairman.
The chairman should have been or presently a senior practitioner in public accountancy
The development and improvement of accounting standards that will be generally accepted in the Philippin
The examination for registration of certified public accountants
The standardization and regulation of accounting education
The supervision, control, and regulation of the practice of accountancy in the Philippines
A candidate who obtains the rating of 75% and above in at least a majority of the subjects shall
receive a conditional credit for the subjects passed. He/she shall take an examination in the
remaining subjects within
Five (5) years from the preceding examination
Two (2) years from the preceding examination
Three (3) years from the preceding examination
One (1) year from the preceding examination
Which of the following shall be issued to examinees who pass the CPA licensure examination?
The following statements relate to the submission of nominations to the Board of Accountancy.
Which is correct?
There should be adequate documentation to show the qualifications and primary field of professional activit
each nominee
The APO shall submit its nomination to the PRC not later than thirty day (30) days prior to the expiry of the
of an incumbent chairman or member
If the APO fails to submit its own nominee(s) to the PRC within the required period, the PRC in consultatio
the BoA shall submit to the president of the Philippines a list of five (5) nominees for each position
The Accredited National Professional Organization of CPAs (APO) shall submit its nominations to the pres
the Philippines not later than Sixty (60) days prior to the expiry of the term of an incumbent chairman or me
Derive their credibility and authority from general recognition and acceptance by the accountancy professio
Derive their credibility and authority from the national government through the SEC
Derive their credibility/authority from legal rulings and court precedents
Are accounting adaptations based on the laws of economic science
According to Section 240 of the Code of Ethics, fees charged for assurance engagements
should be a fair reflection of the value of the work involved. In determining professional fees, the
following should be taken into account, except:
the level of training and experience of the persons necessarily engaged on the work
the skill and knowledge required for the type of work involved
the time necessarily occupied by each person engaged on the work
the outcome or result of a transaction or the result of the work performed
Objectivity
Independence of mind
Professional skepticism
Independence
The Code of Ethics for Professional Accountants in the Philippines defined “practice” as
An entity under common control, ownership or management with the firm or any entity that a reasonable an
informed third party having knowledge of all relevant information would reasonably conclude as being part
firm nationally or internationally
A distinct sub-group, whether organized on geographical or practice lines
A sole proprietor or a partnership of professional accountants which offers professional services to the publ
Any service requiring accountancy or related skills performed by a professional accountant including accou
auditing, taxation, management consulting and financial management services
Dispose of the indirect financial interest in total or dispose of a sufficient amount of it so that the remaining
is no longer material prior to the individual becoming a member of the assurance team.
Discuss the matter with those charged with governance of the assurance client.
Dispose of the direct financial interest prior to the individual becoming a member of the assurance team.
Remove the member of the assurance team from the assurance engagement.
A loan or guarantee of a loan to the firm from an assurance client that is a bank or a
similar institution, to a member of the assurance team or his immediate family,
would not create a threat to independence provided the loan or guarantee is
The communication to the public of facts about a professional accountant which are not
designed for deliberate promotion of that promotional accountant is called?
Advertising
Publicity
Announcements
Solicitation
The following statements related to the provision of legal services to an audit client.
Which is incorrect?
The appointment of a partner or an employee of the firm or network firm as General counsel
for legal affairs to an audit client would create self-review and advocacy threats that are so
significant no safeguards could reduce the threats to an acceptable level
Acting for an audit client in the resolution of a dispute or litigation in such circumstances
when the amounts involved are material in relation to the financial statements of the audit
client would create advocacy and self-review threats to significant no safeguards could
reduce the threats to an acceptable level
The provision of legal services to an audit client involving matters that would not
be expected to have a material effect on the financial statement may create a self-
review threat
Legal services to support an audit client in the execution of a transaction (e.g.
contract support) may create a self-review threat
I and IV only
III and IV only
II and III only
I and II only
Objectivity
Integrity
Confidentiality
Professional competence and due care
Which of the following threats to independence may be created by family and personal
relationships between a member of the assurance team and a director, an officer, or an
employee of the assurance client in a position to exert direct and significant influence
over the subject matter information of the assurance engagement?
Self-interest, familiarity or intimidation threats
Self-interest, advocacy or self-review threats
Advocacy, familiarity or self-review threats
Self-review, familiarity or advocacy threats
If the fee quoted for a professional service is so low, it may be difficult for a CPA to
perform the engagement in accordance with applicable technical and professional
standards for that price. This situation may create a self-interest threat to
Objectivity
Professional competence and due care
Professional behavior
Integrity
Would impair integrity, objectivity or independence, or the good reputation of the profession
Is a violation of the code of ethics
Does not by itself impair integrity, objectivity or independence
Is inconsistent with the practice of public accountancy
The payment or receipt of referral fees or commissions may create threats to which
fundamental principles?
i. Integrity iii. Professional competence and due care
ii Objectivity iv. Professional behavior
I and III
II, III and IV
II and III
I and IV
CPAs should not be liable to any party if they perform their services with:
Regulatory providence
Good faith
Due professional care
Ordinary negligence
Which of the following statements about CPA’s financial interest in a client is incorrect?
Using the same senior personnel on an assurance engagement over a long period of
time may create a familiarity threat. The significance of the threat will least likely
depend upon
Which of the following activities would least likely impair the professional accountant’s
independence?
These following services are considered to be a normal part of the audit process and do
not, under circumstances, threaten independence, except
When threats to independence that are other than those clearly insignificant are
identified, the professional accountant should
A CPA firm should decline an offer to perform consulting services engagement if:
If the problem is not resolved with the immediate superior and the professional accountant determines to go
next higher managerial level, the immediate superior need not be notified of the decision
Follow the established policies of the employing organization to seek a resolution of such conflict
Review the conflict problem with the immediate superior if the organization’s policies do not resolve the et
conflict
Seek counseling and advice on a confidential basis with an independent advisor or the applicable profession
accountancy body or regulatory body to obtain an understanding of possible courses of action
Which statement is correct regarding the Code of Ethics for Professional Accountants in
the Philippines?
Professional accountants should consider the ethical requirements as the ideal principles which they should
in performing their work
All CPAs are expected to comply with the ethical requirements of the Code and other ethical requirements t
may be adopted and approved by IFAC. Apparent failure to do so may result in an investigation into the CP
conduct
It is practical to establish ethical requirements which apply to all situations and circumstances that professio
accountants may encounter
Professional accountants refer to persons who are Certified Public Accountants (CPA) in public practice an
hold a valid certificate issued by the Board of Accountancy