1 Republic of the Philippines

2 Congress of the Philippines

3 Seventeenth Congress

4 First Regular Session

5 Begun and held in Metro Manila, on_____________________________

6 Republic Act No. ______________

7 AN ACT AMENDING CERTAIN PROVISIONS OF REPUBLIC ACT NO. 9298, ENTITLED “AN

8 ACT REGULATING THE PRACTICE OF ACCOUNTANCY IN THE PHILIPPINES,

9 REPEALING FOR THE PURPOSE PRESIDENTIAL DECREE NO. 692, OTHERWISE KNOWN

10 AS THE REVISED ACCOUNTANCY LAW, APPROPRIATING FUNDS THEREFOR AND FOR

11 OTHER PURPOSES,” REVISING THE COMPOSITON OF THE BOARD OF ACCOUNTANCY

12 TO CHAIRPERSON AND EIGHT MEMBERS, CREATING THE ACCOUNTANCY

13 REGULATORY OFFICE AND ACCOUNTING COUNCILS, DEFINING THEIR POWERS AND

14 FUNCTIONS, APPROPRIATING FUNDS THEREFOR, AND FOR OTHER PURPOSES

15 Section 1. Section 1 is hereby amended as follows:

16 Section 1. Short Title. - This act shall be known as the "Revised Philippine Accountancy Act of

17 2016"

18 Section 2. Section 3 is hereby amended as follows:

19 Section 3. Objectives. - This Act shall provide and govern:

20 The standardization and regulation of accounting education;

21 The examination of registration of certified accountants, certified professional

22 accountants and certified public accountants; (hereinafter collectively called as

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23 licensed accountants)and

24 The supervision, control, and regulation of the practice of accountancy in the

25 Philippines.

26 Section 3. Section 4 is hereby amended as follows:

27 Section 4. Scope of Practice. - The practice of accountancy in the Philippines shall only be

28 allowed for Certified Accountants, Certified Professional Accountants and Certified Public

29 Accountants who have passed the applicable licensure examinations prescribed in Section 13

30 of this Act, unless otherwise specifically permitted or excluded in the paragraphs enumeration

31 in this Section, The practice of accountancy shall include, but not limited to, the following:

32 (a) Practice of Public Accountancy - shall constitute a person, be it his/her individual

33 capacity, or as a partner or staff member in an professional partnership of

34 certified public accountants, or as a stockholder, officer or employee of a

35 corporation created for public practice of accountancy ,holding out himself/herself

36 as one skilled in the knowledge, science and practice of accounting, and as a

37 qualified person to render professional services as a licensed accountant; or

38 offering or rendering, or both or more than one client on a fee basis or otherwise,

39 services as such as the audit or verification of financial transaction and

40 accounting records; or the preparation, signing, or certification for clients of

41 reports of audit, balance sheet, and other financial, accounting and related

42 schedules, exhibits, statement of reports which are to be used for publication or

43 for credit purposes, or to be filed with a court or government agency, or to be

44 used for any other purposes; or to design, installation, and revision of accounting

45 system; or the preparation of tax returns when related to accounting procedures;

46 or when he/she represent clients before government agencies on tax and other

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47 matters relating to accounting or render professional assistance in matters

48 relating to accounting procedures and the recording and presentation of financial

49 facts or data; Provided that a person who has been licensed as a Certified

50 Public Accountant shall be the only one who can sign the Auditor Certification

51 or any other similar document that are covered by accounting and auditing

52 standards issued by the Board.

53 (b) Practice in Commerce and Industry - shall constitute in a person involved in

54 decision making requiring professional knowledge in the science of accounting,

55 or when such employment or position requires that the holder thereof must be a

56 certified professional accountant. Provided that the compilation services in the

57 preparation of financial statements of organizations in the private sectors is

58 considered as practice of accountancy in commerce and industry that can be

59 done by a Certified Accountant, Certified Professional Accountant or a Certified

60 Public Accountant.

61 (c) Practice in Education/Academe - shall constitute in a person in an educational

62 institution which involve teaching of accounting, auditing, management advisory

63 services, finance, business law, taxation and other technically related subject:;

64 Provided that Certified Professional Accountants and Certified Public

65 Accountants shall be the only ones who can teach the aforementioned subjects

66 indicated in this paragraph; Provided that persons, who have been certified by

67 organizations which are accredited by the Board and which provide

68 examinations, tests or its equivalence for recognition or certification of

69 accountancy related competencies, shall also be allowed to teach the

70 aforementioned subjects indicated in this paragraph; Provided, that members of

71 the Integrated Bar of the Philippines shall be allowed to teach business law and

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72 taxation subjects; Provided finally, that all those who shall teach shall also

73 comply with the requirements of CHED.

74 (d) Practice in Government - shall constitute in a person who holds, or is

75 appointed to, a position in an accounting professional group in government or in

76 an government-owned and/or controlled corporation, including those performing

77 proprietary functions, where decision making requires professional knowledge in

78 the science of accounting, or where a civil service eligibility as a certified public

79 accountant is a prerequisite

80 ARTICLE II

81 PROFESSIONAL REGULATORY BOARD OF ACCOUNTANCY

82 Section 4. Section 5 is hereby amended as follows:

83 Section 5. The Professional Regulatory Board of Accountancy and its Composition. - The

84 Professional Regulatory Board of Accountancy, (hereinafter referred to as “Board”) under the

85 supervision and administrative control of the Professional Regulation Commission, hereinafter

86 referred to as the Commission, shall be composed of a Chairperson and eight (8) members to

87 be appointed by the President of the Philippines from a list of three (3) recommendees for each

88 position to be submitted by the Commission The Board shall elect a vice-chairperson from

89 among each members. The chairman shall preside in all meetings of the Board and in the event

90 of a vacancy in the office of the chairperson, the vice-chairperson shall assume such duties and

91 responsibilities until such time as a chairperson is appointed.

92 Section 5 Section 6 is hereby amended as follows:

93 Section 6. Qualifications of a members of the Professional Regulatory Board. - A member of

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 94 the Board shall, at the time of his/her appointment, posses the following qualifications:

95 Must be a natural-born citizen and a resident of the Philippines;

96 Must be a duly registered Certified Accountant, Certified Professional Accountant

97 or Certified Public Accountant with at least ten (10) years of work experience in

98 any scope of practice of accountancy;

99 Must be a good moral character and must not have been convicted of crimes

100 involving moral turpitude; and

101 Must not have any pecuniary interest, directly or indirectly, in any school, college,

102 university or institution conferring an academic degree necessary for admission

103 to the practice of accountancy or where review classes in preparation for the

104 licensure examination are being offered or conducted, nor shall he/she be a

105 member of the faculty or administration thereof at a time of his/her appointment

106 to the Board, and/or must not be actively involved in public practice.

107 Section 6. Section 9 is hereby amended as follows:

108 Section 9. Powers and Functions of the Board. - The Board shall exercise the following specific

109 powers, functions and responsibilities:

110 To prescribe and adopt the rules and regulations necessary for carrying out the provisions of

111 this Act;

112 To supervise the giving of the licensure examinations and registration of Certified Accountants,

113 Certified Professional Accountants and Certified Public Accountants in the Philippines;

114 To administer oaths in connection with the administration of this Act;

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115 To issue, suspend, revoke, reinstate the Certificate of Registration for the practice of the

116 accountancy profession;

117 To adopt an official seal of the Board;

118 To prescribe and/or adopt a Code of Ethics for the practice of accountancy;

119 To monitor the conditions affecting the practice of accountancy and adopt such measures,

120 including promulgation of accounting and auditing standards, rules and regulations and best

121 practices as may be deemed proper for the enhancement and maintenance of high

122 professional, ethical, accounting and auditing standards: That domestic accounting and auditing

123 standards rules and regulations shall include the include the international accounting and

124 auditing standards, and generally accepted best practices; That, the special requirements of

125 Micro ,Small and Medium Business Enterprises shall be considered in the promulgation of the

126 standards, rules and regulations., including but not limited, to prescribing the audit or attest

127 thresholds conducted by the Certified Public Accountant

128 To investigate violations of this act and the rules and regulations promulgated hereunder and for

129 the purpose, to issue summons, subpoena and subpoena ad testificandum and subpoena

130 duces tecum to violator or witness thereof and compel their documents in connection therewith:

131 Provided, That the Board upon approval of the Commission may, subject to such rules and

132 regulations that may be promulgated to implement this section, delegate the fact-finding aspect

133 of such investigations to the accredited national professional organization of certified public

134 accountant: Provided, further, That the Board and/or the Commission may adopt their findings

135 of fact as may be seems fit;\

136 The Board may, muto propio in its discretion, may such investigations as it deem necessary to

137 determine whether any person has violated any provisions of this law, any accounting or

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138 auditing standard or rules duly promulgated by the Board as part of the rules governing the

139 practice of accountancy;

140 To issue a cease or desist order to any person, associations, partnership or corporation

141 engaged in violation of any provision of this Act, any accounting or auditing standards or rules of

142 duly promulgated by the Board as part of the rules governing the practice of accountancy in the

143 Philippines;

144 To punish for contempt of the Board, both direct and indirect, in accordance with the pertinent

145 provision of and penalties prescribed by the Rules of Court;

146 To prepare, adopt, issue or amend the syllabi of the subjects for examinations in consultation

147 with the academe, determine and prepare questions for the licensure examination which shall

148 strictly be within the scope of the syllabi of the subjects for examinations as well as administer,

149 correct and release the result of the licensure examinations;

150 To ensure the coordination with the Commission of the Higher Education (CHED) or other

151 authorized government offices that all higher educational instruction and offering of accountancy

152 comply with the policies, standards and requirements of the course prescribed by the CHED or

153 other authorized government offices in the areas of curriculum, faculty, library and facilities;

154 To accredit organizations which provide examinations, tests or its equivalence for recognition or

155 certification of accountancy related competencies

156 To exercise such other powers as may be provided by law as well as those which may be

157 implied from, or which are necessary or incidental to the carrying out of, the express powers

158 granted to the Board to achieve the objectives and purposes of this Act.

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159 The policies resolution, rules and regulations issued or promulgated by the Board shall be

160 subject to review and approval of the Commission. However, the Board's decisions, resolutions

161 or orders rendered in the administrative cases shall be subject to review only if on appeal

162 Section 7. Section 11 is hereby amended as follows:

163 Section 11. Grounds for Supervision or Removal of Members of the Board. - The President of

164 the Philippines, upon the recommendation of the Commission, after the giving the concerned

165 member an opportunity to defend himself in proper administrative investigation to be conducted

166 by the Commission, may suspend or remove any member of the following grounds:

167 Neglect of duty or incompetence;

168 Violation or tolerance of any violation of this Act and it's implementation rules and

169 regulations or the Code of Ethics and the technical and professional standards of

170 practice for licensed accountant;

171 Final judgment of crimes involving moral turpitude; and

172 Manipulation or rigging of the licensed accountant's licensure examination

173 results, disclosure of secret and confidential information in the examination

174 questions prior to the conduct of the said examination or tampering of grades.

175 ARTICLE III

176 EXAMINATION, REGISTRATION AND LICENSURE

177 Section 8. Section 13 is hereby amended as follows:

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178 Section 13. The Licensure Examinations. - All applicants for registration for the practice of

179 accountancy shall be required to undergo the applicable licensure examination to be given by

180 the Board in such places and dates as the Commission may be designate Provided, that the

181 licensure examination shall be two levels, namely the (1) first level Certified Accountant (“CA”)

182 examination and (2) the second level Certified Professional Accountants (“CPA”) and Certified

183 Public Accountants (“CPA”) examination; Provided that the first level CA examination is

184 mandatory for the holders of the Accountancy course or program referred to in Section 14 of this

185 Act who shall practice accountancy; Provided that the second level CPA examination shall be

186 optional for those who (1) have passed the CA examinations and (2) have gained three years

187 of meaningful work experience as may be defined in rules and regulations that shall be issued

188 for this purpose; Provided that there shall be a specific CPA examination that shall be given for

189 each Accountancy course or program accredited by the CHED or other authorized government

190 offices.

191 Section 9. Section 14 is hereby amended as follows:

192 Section 14. Qualifications of Applicant for the Licensure Examinations. - Any person applying for

193 examination shall establish the following requisites to the satisfaction of the Board that he/she:

194 is a Filipino citizen;

195 is of good moral character;

196 is a holder of the degree of Bachelor of Science Accountancy degree or program

197 conferred by the school, college, academy or institute duly recognized and/or

198 accredited by the CHED or other authorized government offices; and

199 has not been convicted of any criminal offence involving moral turpitude.

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200 Provided that person who is not a citizen of the Philippines may be allowed to take the

201 Licensure Examination upon completion of the applicable requirements indicated above and

202 after proving in a manner provided by the Philippine Rules of Court that, by specific provision of

203 law, the country of which he is a citizen, subject, or national allows citizens of the Philippines to

204 take the licensure examination or any other similar process, or to the practice of the profession

205 on terms of strict and absolute equality with citizens, subjects, or nationals of the country

206 concerned. .

207 Section 10. Section 15 is hereby amended as follows:

208 Section 15. Scope of Examination. - The CA and CPA licensure examinations shall include such

209 subjects that may be prescribed by the Board, subject to the approval of the Commission.

210 Furthermore, the Board, with the approval of the Commission, may be allowed to outsource the

211 preparation of some of the questions that shall be used in the licensure examinations.

212 Section 11. Section 16 is hereby amended as follows:

213 Section 16. Rating in the Licensure Examination. – (a) Rating in the Certified Accountant

214 examinations. To be qualified as having passed the licensure examination for Certified

215 Accountant and be considered as a licensed accountant, a candidate must obtain a general

216 average of seventy five percent (75%), with no grade lower than sixty-five percent (65%) in any

217 given subject. In the event a candidate obtains the rating of seventy-five percent (75%) and

218 above in at least a majority of subjects as provided for in this Act, he/she shall receive a

219 conditional credit for the subjects passed: Provided, That a candidate shall take an examination

220 in the remaining subjects within two (2) years from preceding examination: Provided, further,

221 That if the candidate fails to obtain at least a general average of seventy-five percent (75%) and

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222 a rating of at least sixty-five percent (65%) in each of the subjects reexamined, he/she shall be

223 considered as failed in the entire examination.

224 (b) Rating in the Certified Professional or Certified Public Accountant examinations - To be

225 qualified as having passed the licensure examination for Certified Professional Accountant or

226 Certified Professional Accountant and be considered as a licensed accountant, a candidate

227 must obtain a general average of seventy five percent (75%),

228 Section 12. Section 17 is hereby amended as follows:

229 Section 17. Report of Rating. - The Board shall submit to the Commission the rating obtained by

230 each candidate within ten (10) calendar days after the examination, unless extended for just

231 cause. Upon the release of the results of the examination, the Commission shall send by

232 mailing the rating received by each examinee at his/her given address using the mailing envelop

233 submitted during the examination or by other means of transmittal that the Board may

234 recommend to the Commission.

235 Section 13. Section 18 is hereby amended as follows:

236 Section 18. Failing CA Examination Candidates to Take Refresher Course. - Any candidate who

237 fails in two (2) complete CA examinations shall be disqualified from taking another set of

238 examinations unless he/she submit evidence to the satisfaction of the Board that he/she

239 enrolled in and completed at least twenty-four (24) units of subject given in the licensure

240 examination.

241 For purposes of this Act, the CA examination in which the candidate was conditioned together

242 with the removal examination on the subject in which he/she failed shall be counted as one

243 compete examination.

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244 Section 14. Section 21 is hereby amended as follows:

245 Section 21. Roster of Licensed Accountants. - A roster showing the names and place of

246 business of all licensed accountants shall be prepared and updated by the Board,

247 Section 15. Section 22 is hereby amended as follows:

248 Section 22. Indication of Certificate of Registration, Identification Card and Professional Tax

249 Receipt. - The licensed accountant shall be required to indicate his/her certificate of registration

250 number and date of issuance, the duration of validity, including the Professional Tax Receipt

251 number on the documents he/she signs, uses or .

252 Section 16. Section 25 is hereby amended as follows:

253 Section 25. Reinstatement, Reissuance and Replacement of Revoked or Lost Certificates. - The

254 Board may, after the expiration of two (2) years from the date of revocation of a certificate of

255 registration and upon application and for reasons deemed proper and sufficient, reinstate the

256 validity of a revoked certificate of registration and in so doing, may, in its discretion, exempt the

257 applicant from taking another examination.

258 A new certificate of registration to replace lost, destroyed, or mutilated certificate/license may be

259 issued, subject to the rules and promulgated by the Board and the Commission, upon the

260 payment of the required fees.

261 Section 17. Sections 26 to 28 and 30 to 32is hereby amended as follows:

262

263 ARTICLE IV

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264 PRACTICE OF ACCOUTANCY

265

266 Section 26. Prohibition in the Practice of Accountancy. - No person shall practice accountancy

267 in this country, or use the title “Certified Accountant,” Certified Professional; Accountant” or

268 "Certified Public Accountant", or use the abbreviated title “Acct,” “CA,” or "CPA" or display or

269 use any title, sign, card, advertisement or other device to indicate such person practices or

270 offers to practice accountancy, or is a licensed accountant, unless such person shall have

271 received from the Board a certificate of registration/Professional license and be issued a

272 professional identification card or a valid temporary/special permit duly issued to him/her by the

273 Board and the Commission

274 Section 27. Vested Rights. - Certified Public Accountants Registered When This Law is Passed.

275 - All certified public accountants registered at the time this law takes effect shall automatically

276 be registered under the provisions hereof, subject, however, to the provisions herein set forth as

277 to future requirements. Certificate of Registration/Professional license held by such persons in

278 good standing shall have the same license force and effect as though issued after the passage

279 of this Act.

280 Section 28. Forms of Practice of Public Accountancy. - The practice of public accountancy can

281 be in the form of a sole practice; professional partnership, including that with limited liability;

282 and a corporation, the stock holders of which are all licensed accountants. The Board, with the

283 concurrence of the Commission, shall issue the rules and regulations to implement the practice

284 of public accountancy in the form of partnership with limited liability and a corporation.:

285 Section 30. Accredited Professional Organization. - All registered licensed accountants shall be

286 united and integrated though their membership in a one and only registered and accredited

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287 national professional organization of registered and licensed accountants, which shall be

288 registered with the Securities and Exchange Commission as a nonprofit corporation and

289 recognized by the Board subject to the approval by the Commission. The members of the said

290 integrated and accredited national professional organization shall receive benefits and privileges

291 appurtenant thereto upon payment of required fees and dues. Membership in the integrated

292 organization shall not be a bar to membership in any other association of certified public

293 accountants.

294 Section 31. Accreditation to Practice Accountancy. – (a) Accreditation to Practice Public

295 Accountancy . Certified Public accountants, firms partnerships, engaged in the practice of

296 public accountancy including partners and staff members thereof, and corporations, including its

297 stockholders and officers who are certified public accountants, shall register with the

298 Commission and the Board and/or Accountancy Regulatory Office , such registration to be

299 renewed at time intervals to be prescribed by the Board and/or the ARO : Provided, That subject

300 to the approval of the Commission, the Board and/or ARO shall promulgate rules and

301 regulations for the implementation of registration requirements including the fees and penalties

302 for violation thereof. Provided further, that the sole power to regulate the practice of

303 accountancy and accredit Certified Public Accountants, including among others- their

304 categorization/classification to the exclusion of all other government agencies, shall belong to

305 the Board and/or the ARO.

306 (b) Accreditation of Certified Accountants and Certified Professional Accountants in Commerce

307 and Industry, in Education and in Government. The Board and/or the Accountancy Regulatory

308 Office shall have the authority to require the accreditation of the CAs and CPAs in the sectors of

309 Commerce and Industry, in Education and in Government, following the rules and regulations

310 that may be prescribed for this purpose; Provided further, that the sole power to regulate the

311 practice of accountancy in the various sectors, including among others- their

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312 categorization/classification to the exclusion of all other government agencies, shall belong to

313 the Board and/or the Accountancy Regulatory Office.

314 Section 32. Continuing Professional Development (CPD) Program. - All licensed accountants

315 shall abide by the requirements, rules and regulations on continuing professional development

316 to be promulgated by the Board, subject to the approval of the Commission, in coordination with

317 the accredited national professional organization of certified accountants or any duly accredited

318 educational institutional. For this purpose, a CPD Council is hereby created to implement the

319 CPD program.

320 Section 22. Article V is hereby added as follows:

321 ARTICLE V

322 ACCOUNTANCY REGULATORY OFFICE

323 Section 37. Creation of the Accountancy Regulatory Office. - The Accountancy Regulatory

324 Office, ( “ARO”) shall be created. The ARO shall be under the supervision and administrative

325 control of the Professional Regulation Commission or any other government office that the

326 President of the Philippines may designate. The ARO shall be headed by an Executive Director

327 whose salary shall be equivalent to that of the Chairman of the Board of Accountancy.

328 Section 38. Powers and Functions of the ARO. - The ARO shall exercise the following specific

329 powers, functions and responsibilities:

330 To prescribe and adopt the rules and regulations necessary for regulating the accountancy

331 profession and carrying out the provisions of this Act;

332 To supervise the practice of accountancy in the Philippines;

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333 To issue, suspend, revoke, reinstate the Certificate of Accreditation that may be prescribed for

334 the practice of the accountancy profession;

335 To administer and implement the Continuing Professional Development Program

336 To conduct an oversight into the quality of audits of financial statements and operations of

337 certified public accountants though a quality assurance review of the control and practice

338 operationalmeasures instituted by auditors in order to ensure compliance with the accounting

339 and auditing standards, rules, regulations and practices,. For this, the ARO may disclose the

340 results of the review it has conducted to provide feedback to the certified public accountants on

341 their practice of profession

342 To adopt an official seal of the ARO ;

343 To monitor the conditions affecting the practice of accountancy and adopt such measures,

344 including promulgation of, rules and regulations and best practices as may be deemed proper

345 for the effective regulation of the accountancy profession. That, the special requirements of

346 Micro ,Small and Medium Business Enterprises shall be considered in the promulgation of the

347 standards, rules and regulations

348 To investigate violations of this act and the rules and regulations promulgated hereunder and for

349 the purpose, to issue summons, subpoena and subpoena ad testificandum and subpoena

350 duces tecum to violator or witness thereof and compel their documents in connection therewith:

351 Provided, That the ARO upon approval of the Commission may, subject to such rules and

352 regulations that may be promulgated to implement this section, delegate the fact-finding aspect

353 of such investigations to the accredited national professional organization of certified public

354 accountant: Provided, further, That the ARO and/or the Commission may adopt their findings of

355 fact as may be seems fit;\

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356 The ARO may, muto propio in its discretion, may such investigations as it deem necessary to

357 determine whether any person has violated any provisions of this law, any accounting or

358 auditing standard or rules duly promulgated by the ARO as part of the rules governing the

359 practice of accountancy;

360 To issue a cease or desist order to any person, associations, partnership or corporation

361 engaged in violation of any provision of this Act, any accounting or auditing standards or rules of

362 duly promulgated by the ARO as part of the rules governing the practice of accountancy in the

363 Philippines;

364 To punish for contempt of the ARO , both direct and indirect, in accordance with the pertinent

365 provision of and penalties prescribed by the Rules of Court;

366 To implement a Whistleblower Program that will encourage the reporting of instances of

367 violations of the provisions of this Act , standards and implementing rules and regulations

368 To pursue the development and unpliftment of the public practice of the Small and Medium

369 Practitioners (SMP), including but not limited to the consolidation, merger of strengthening of the

370 organization of the SMPs

371 To exercise such other powers as may be provided by law as well as those which may be

372 implied from, or which are necessary or incidental to the carrying out of, the express powers

373 granted to the Board to achieve the objectives and purposes of this Act.

374 The policies resolution, rules and regulations issued or promulgated by the ARO shall be

375 subject to review and approval of the Commission. However, the ARO Board's decisions,

376 resolutions or orders rendered in the administrative cases shall be subject to review only if on

377 appeal:

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378 Section 39. Quality Assurance Review Fund. The ARO is authorized collect fees in the course

379 of regulatory function, where such fees collected will be held in trust as a “Quality Assurance

380 Review Fund” by the ARO in a trust fund, no portion thereof or any of its income shall accrue to

381 the General Fund of the National Government. The fund will partially finance the quality

382 assurance review activities and allowances that shall be paid to the quality inspectors or

383 reviewers who will be conducting the Quality Assurance Review of the ARO.

384 Section 40.. Organization and staffing plan for the ARO. - The organization structure and the
385
386 staffing plan of the ARO shall be prepared by the Board of Accountancy. In the preparation,
387
388 the Board shall consider the requirements to discharge the functions prescribed in Section 38.
389
390 With the concurrence of the Commission, the organization and staffing plan shall be referred to
391
392 the Department of Budget and Management for evaluation and approval thereof.
393
394 Section 23. A new Article VI is hereby added as follows{
395
396 ARTICLE VI
397
398 ACCOUNTANCY COUNCILS
399

400 Section 41. Accountancy Councils. - The Financial Reporting Standards Council, ,the Auditing

401 and Assurance Standard Council, the Public Sector Financial Accounting Reporting Council,

402 the Accountancy Education Council and the Ethics Standards Council (“Accountancy Councils”)

403 are created. These Accountancy Councils shall be under the supervision and administrative

404 control of the Board of Accountancy or any other government office that the President of the

405 Philippines may designate. Each of the Advisory Councils shall be headed by a Technical

406 Director whose salary shall be equivalent to that of the Member of the Board of Accountancy.

407 The composition of the Councils shall come from the representatives of the APO and various

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408 sectoral organizations as may be prescribed by the Board of Accountancy with the concurrence

409 of the Commission,

410 Section 42. Powers and Functions of the Accountancy Councils . - The Accountancy Councils

411 shall exercise the following specific powers, functions and responsibilities:

412 a) Financial Reporting Standards Council, (1) to establish standards for financial reporting
413
414 of entities in the private sector for approval of the Board of Accountancy and, (2) to
415
416 facilitate their adoption and implementation
417
418 b) Auditing and Assurance Standard Council, - (1) To establish standards for auditing,

419 assurance, and other related areas for the approval of the Board of Accountancy, and

420 (2) to facilitate their adoption and implementation

421 c) Public Sector Financial Accounting Reporting Council- (1) To establish standards for the
422
423 preparation of general purpose financial statements by governments and other public
424
425 sector entities for the approval of the Board of Accountancy, and (2) to facilitate their
426
427 adoption and implementation
428
429 d) Accountancy Education Council – (1)To establish standards in the area of accounting

430 education for the approval of the Board of Accountancy, (2) to facilitate their adoption

431 and implementation (3) to coordinate with the Commission of Higher Education and

432 accounting schools on matters on the accounting education, (4) to conduct inspection of

433 accounting schools based on rules and regulations to be issued by the Board of

434 Accountancy with the concurrence of the Professional Regulation Commission,

435 e) Ethics Standards Council –To establish standards in professional ethics and governance

436 for the approval of the Board of Accountancy, and (2) to facilitate their adoption and

437 implementation

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438 Section 43. Organization and staffing plan for the Accoutancy Councils. - The organization

439 structure and the staffing plan of the various Accountancy Councils shall be prepared by the

440 Board of Accountancy. In the preparation,, the Board shall consider the requirements to

441 discharge the functions prescribed in Section 42. With the concurrence of the Commission, the

442 organization and staffing plan shall be referred to the Department of Budget and Management

443 for evaluation and approval thereof.

444 Section 44 Appropriations. - The amount needed for the initial implementation of th ARO and

445 the various Accountancy Councils shall be taken from the current year’s fiscal year’s

446 appropriation of the Professional Regulation Commission. Thereafter, the amount needed for

447 this purpose shall be included in the General Appropriations Act.

448 More ever, nothing in this Act shall prevent the National Government for allocating funds for the

449 operations and capital equipment acquisition of the ARO and the various Accountancy Councils

450 Section 24. A new Article VII is hereby added as follows:

451 ARTICLE Vii

452 SPECIAL PROVISIONS

453 Section 45. Requirement for Licensed Accountant n Audit Committee. The Audit Committee of

454 publicly listed companies in the Philippines shall be required to include at least one Licensed

455 Accountant to be a Chairperson or member of Audit Committees of publicly listed companies in

456 the Philippines.

457 Section 25. Article V is hereby amended as follows:

458 ARTICLE VIII

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459 PENAL AND FIINAL PROVISIONS

460 Section 46 Penal Provision. - Any person, whether accountant or not, who shall commit a

461 violation of any of the provisions of this Act or any of its implementing rules and regulations by

462 himself or through conspiring and abetting with others, shall upon conviction, be punished by a

463 fine of not less than Five Thousand Pesos (5,000.00) and/or imprisonment for a period of not

464 less than six (6)r but not more than six (6) years. Violations include, but are not limited to:

465 a) Illegal practice of profession

466 i. False or fraudulent issuance of an audit or assurance report;

467 ii. False representations in a compilation report;

468 iii. Fraudulent documentation or use of falsified documents as basis for an audit or
469 assurance report;

470 iv. Practice of accountancy profession without a valid and effective license; [or
471 accreditation]

472 b) Gross negligence in the conduct of an audit or assurance engagement

473 c) Violation of the Code of Ethics for Professional Accountants or any rule of professional
474 conduct promulgated by the Board;

475 d) Dishonesty, fraud or deceit in obtaining a license or certificate of accreditation;

476 e) Disclosure of information on administrative and criminal cases filed/decided by the

477 Board.

478 f) Any other violation of this Act or any of its Implementing Rules and Regulations.

479 Section 47. Implementing Rules and Regulations. - Within Ninety (90) days after the effectivity

480 of this Act, the Board, subject to the approval of the Commission and in coordination with the

481 accredited national professional organization of licensed accountants, shall adopt and

482 promulgate such rules and regulations to carry out the provisions of this Act and which shall be

483 effective Fifteen (15) days following their publication in the Official Gazette or in any of the major

484 daily newspaper of general circulation.

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485 Section 48. Enforcement of this Act. - It shall be primary duty of the Commission and the Board,

486 ARO and Accountancy Councils to effectivity enforce the provisions of this Act. All duly

487 constituted law enforcement agencies and officers of national, provincial, city or municipal

488 government or of any political subdivision thereof, shall upon the call or request of the

489 Commission, the Board, ARO and Accountancy Councils , render assistance in enforcing the

490 provisions of this Act and to prosecute any person violating the provisions of the same. Section

491 Section 49. Transitory Provision. - Pending the organization of the Accountancy Regulatory

492 Office and the Accountancy Councils, the Board and any other organizations recognized by the

493 Board shall be responsible for discharging the functions thereof. The Certified Public

494 Accountant licensure examination prescribed in Republic Act No. 9892 shall continue pending

495 the start of the effectivity of the two level licensure examinations upon the issuance of the

496 implementing rules and regulations by the Board with the concurrence of the Commission.

497 Section 50. Separability Clause. - If any clause, provisions, paragraph or parts thereof shall be

498 declared unconstitutional or invalid, such judgment shall not affect, invalidate or impair any other

499 part hereof, but shall be merely confined to the clause, provisions, paragraph or part directly

500 involved in the controversy in which such judgment has been rendered.

501 Section 51. Amendatory Clause. – Republic Act N. 9298 is hereby amended and all other laws,

502 orders, rules and regulations or resolutions or part/s thereof inconsistent with the provisions of

503 this Act are hereby repealed or modified accordingly.

504 Section 26. Transitory Provision. - Pending the organization of the Accountancy Regulatory

505 Office and the Accountancy Councils, the Board and any other organizations recognized by the

506 Board shall be responsible for discharging the functions thereof. The Certified Public

507 Accountant licensure examination prescribed in Republic Act No. 9892 shall continue pending

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508 the start of the effectivity of the two level licensure examinations upon the issuance of the

509 implementing rules and regulations by the Board with the concurrence of the Commission.

510 Section 27. Separability Clause. - If any clause, provisions, paragraph or parts thereof shall be

511 declared unconstitutional or invalid, such judgment shall not affect, invalidate or impair any other

512 part hereof, but shall be merely confined to the clause, provisions, paragraph or part directly

513 involved in the controversy in which such judgment has been rendered.

514 Section 28. Amendatory Clause. – Republic Act N. 9298 is hereby amended and all other

515 laws, orders, rules and regulations or resolutions or part/s thereof inconsistent with the

516 provisions of this Act are hereby repealed or modified accordingly.

517 Section 29. Implementing Rules and Regulations. - Within Ninety (90) days after the

518 effectivity of this Act, the Board, subject to the approval of the Commission and in coordination

519 with the accredited national professional organization of licensed accountants, shall adopt and

520 promulgate such rules and regulations to carry out the provisions of this Act and which shall be

521 effective Fifteen (15) days following their publication in the Official Gazette or in any of the major

522 daily newspaper of general circulation.

523 Section 30. Effectivity. - This Act shall take effect after Fifteen (15) days following its

524 publication in the Official Gazette or in any major daily newspaper of general circulation.

525

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