CHAPTER 4

True or False
# Answer Basis Text/Explanation
1 FALSE Second paragraph, Par. A CPA shall practice only under an individual, firm or
1(c)(ii), Annex “B,” Rules partnership name allowed in accordance with Philippine laws
and Regulations and shall not include any fictitious name, indicates specialization
Implementing RA 9298 or is misleading as to the type of organization (proprietorship or
partnership). A partner surviving the death or withdrawal of all
the other partners in a Partnership may continue to practice under
the Partnership name for a period of not more than two (2) years
after becoming a sole proprietor. XXX
2 FALSE Sec. 3, BOA Resolution no. All CPA’s, regardless of area/sector of practice, shall be required
358 series of 2016 to comply with the one hundred twenty (120) CPD credit units
within a compliance period of three (3) years. XXX
3 FALSE Sec. 28, RA 9298 XXX The Security and Exchange Commission shall not register
any corporation organized for the practice of public accountancy.
4 FALSE Merriam-Webster Dictionary In actual time charges basis, billing is done on the basis of actual
time spent by the staff multiplied by the hourly rates agreed
upon. In retainer fee basis, auditor is paid a fixed pre-determined
fee for all services rendered during a designated period of time
either on a monthly, semi-annual or annual basis
5 TRUE Sec. 10.2a-10.2b, Code of XXX
Ethics (2001) (a) The skill and knowledge required for the type of
professional services involved;
(b) The level of training and experience of the persons
necessarily engaged in performing the professional services;
XXX
6 TRUE Sec. 10.2c-10.2d, Code of XXX
Ethics (2001) (c) The time necessarily occupied by each person engaged in
performing the professional services; and
(d) The degree of responsibility that performing those
services entails.
7 FALSE Sec. 10.3, Code of Ethics Professional fees should normally be computed on the basis of
(2001) appropriate rates per hour or per day for the time of each person
engaged in performing professional services. These rates should
be based on the fundamental premise that the organization and
conduct of the professional accountant in public practice and the
services provided to clients are well planned, controlled and
managed. XXX
8 FALSE Sec. 3, BOA Resolution no. XXX Required minimum units earned from the previous year(s)
358 series of 2016 for license renewal: Zero (0) for 2016 and 2017; Twenty (20)
units earned from the immediately preceding year, and; Twenty
(20) units earned from each of the two immediately preceding
years.
9 FALSE Definitions, Code of Ethics Solicitation - The approach to a potential client for the purpose
(2001) of offering professional services.
10 FALSE Par. 1(a), Annex “B,” Rules XXX The registration shall be valid for a period of three (3)
and Regulations years and may be renewed every three (3) years on or before
Implementing RA 9298 September 30 on the year of expiry upon compliance of the
requirements provided in this revised rules and regulations. XXX
CHAPTER 4
11 FALSE Par. 4, Annex “B,” Rules and The death or disability of an individual CPA and/or the
Regulations Implementing dissolution and liquidation of a Firm or Partnership of CPAs
RA 9298 shall be reported to the board XXX not later than thirty (30) days
from the date of such death, dissolution or liquidation. XXX
12 FALSE Third paragraph, Whereas WHEREAS, any advertising by professional accountants beyond
clause, BOA Resolution no. their name, address, telephone number and membership in
126 series of 2008 professional organizations has been traditionally considered
unethical in the Accounting Profession.
13 TRUE Second paragraph, Par. A24, Effective recruitment processes and procedures help the firm
PSQC 1 select individuals of integrity who have the capacity to develop
the competence and capabilities necessary to perform the firm’s
work and possess the appropriate characteristics to enable them
to perform competently.
14 FALSE Article 1767, Civil Code of By the contract of partnership XXX, with the intention of
the Philippines dividing the profits among themselves.
Two or more persons may also form a partnership for the
exercise of a profession.
15 FALSE Par. 2(a), Annex “C,” Rules The Board, upon approval by PRC, shall create a Council within
and Regulations thirty (30) days from effectivity of this resolution. This shall be
Implementing RA 9298 known as the PRC CPE Council which shall assist the Board in
implementing its CPE program.
16 FALSE Sec. 28, RA 9298 XXX, a certificate of accreditation shall be issued to certified
public accountant in public practice only upon showing, XXX,
that such registrant has acquired a minimum of three (3) years
meaningful experience in any of the areas of public practice
including taxation: XXX
17 FALSE Par. 1(g), Annex “B,” Rules XXX, issue to the applicant the corresponding Certificate of
and Regulations Registration to practice public accountancy. Unless sooner
Implementing RA 9298 revoked, cancelled or withdrawn, said Certificate of Registration
shall be valid for three (3) years XXX, shall be renewable every
three (3) years XXX
18 TRUE Sec. 28, RA 9298 Limitation of the Practice of Public Accountancy. - Single
practitioners and partnerships for the practice of public
accountancy shall be registered certified public accountants in
the Philippines: XXX
19 FALSE First paragraph, Par. 1(c)(ii), XXX In the case of Firms, they shall do business under their
Annex “B,” Rules and respective duly registered and authorized Firm name appearing
Regulations Implementing in the registration documents issued by the Department of Trade
RA 9298 and Industry (DTI) XXX. In the case of registered Partnerships,
they shall do business under their respective Partnership names
as indicated in their current Articles of Partnership and
certificates of registration issued by the Securities and Exchange
Commission (SEC) XXX
20 TRUE Appendix A, BOA 1. Professional Track XXX
Resolution no. 358 series of 2. Academic Track XXX
2016 3. Self-directed (training offered by non-accredited CPD
providers, face-to-face/online) and/or Life-long Learning
4. Such other activities to be recommended by the CPD
Council and approved by the Board of Accountancy and
CHAPTER 4
the Professional Regulation Commission
CHAPTER 4
Multiple Choice Questions

# Answer Basis Text

1 D Sec. 28, RA 9298 XXX The Security and Exchange Commission shall not register
any corporation organized for the practice of public accountancy.
2 B First paragraph, Par. 1(c)(ii), XXX and such Firm name shall include the real name of the sole
Annex “B,” Rules and proprietor as printed in his CPA certificate (i.e. “Juan de la Cruz
Regulations Implementing and Associates”) or other similar Firm names. XXX
RA 9298
3 C Sec. 33, RA 9298 All license certified public accountants shall obtain and use a
seal of a design prescribed by the Board bearing the registrant's
name, registration number and title. XXX
4 D Sec. 22, Rules and The certified public accountant shall be required to indicate the
Regulations Implementing numbers of his/her Certificate of Registration and Professional
RA 9298 Identification Card with its date of issuance and the duration of
validity, including the Professional Tax Receipt Number which
the City/Municipality Treasurer shall issue to the registered CPA
upon presentation of his/her current professional identification
card, on the documents he/she signs, uses or issues in connection
with the practice of his/her profession
5 C American Institute of CPAs XXX
(https://www.aicpa.org/caree Senior Auditor (3-6 years) works under the general direction of
r/careerpaths/publicaccountin an Audit Manager. Responsibilities include the direction of audit
g.html) field work, assignment of detail work to Staff, and review of
their working papers. Also prepares financial statements,
develops corporate tax returns, and suggests improvements to
internal controls.
XXX
6 D Sec. 10.2, Code of Ethics Professional fees should be a fair reflection of the value of the
(2001) professional services performed for the client, taking into
account:
(a) The skill and knowledge required for the type of
professional services involved;
(b) The level of training and experience of the persons
necessarily engaged in performing the professional services;
(c) The time necessarily occupied by each person engaged in
performing the professional services; and
(d) The degree of responsibility that performing those
services entails.
7 D Merriam-Webster Dictionary Maximum Fee - a fee determined on the basis of payment at an
hourly or per diem rate up to but not exceeding an agreed
maximum sum for the entire task
8 C Appendix A, BOA Professional Track: as participant, as resource speaker, as
Resolution no. 358 series of panelist/reactor, as facilitator/moderator, CPD monitor, In-
2016 service training/ on-the-job training
Academic Track: Master’s degree or equivalent, Doctorate
degree or equivalent, Bachelors of law, Professional
Certifications, Foreign Language Certification, Professional
Chair, Internship/Specialty/Sub-specialty program, Fellowship
CHAPTER 4
9 A https://en.wikipedia.org/wiki
/Management_consulting
10 C Par. 4, BOA Resolution no.
58 series of 2012
11 C Sec. 31, RA 9298
12 D First paragraph, Par. 1, BOA
Resolution no. 126 series of
2008
13 D Second paragraph, Par. 1,
BOA Resolution no. 126
series of 2008
Grant, Post-graduate diploma
Self-directed and/or Life-long Learning: as participant, as
resource speaker, as panelist/reactor, as facilitator/moderator, In-
service training/ on-the-job training, program/training module
development, technical paper, Article published in a Refereed /
Peer reviewed Professional journal, pamphlet/ book or
monograph, magazine/newspaper articles relevant to topics in
the Competence areas, study tour ad visits, active committee
membership in FRSC, AASC, PIC, CPD, PICPA
Management consulting is the practice of helping organizations
to improve their performance, operating primarily through the
analysis of existing organizational problems and the
development of plans for improvement. XXX
The 60 units of CPD required for accreditation of CPAs in public
accountancy and accounting education shall be distributed
among five thematic areas as follows:
Enabling Laws, Rules and Obligations
Standards Applicable to Professional Practice
Ethical, Governance, and Quality Principles
Environment of the Practice
Development of the Person as a Professional
Certified public accountants, firms and partnerships of certified
public accountants, engaged in the practice of public
accountancy, including partners and staff members thereof, shall
registered with the Commission and the Board, such registration
to be renewed every three (3) years: XXX
Generally, advertising and publicity in any medium are
acceptable provided:
a. It has as its objective the notification to the public or such
sectors of the public as are concerned, of matters of fact (e.g.,
name, address, contact numbers, services offered) in a manner
that is not false, misleading or deceptive;
b. It is in good taste;
c. It is professionally dignified; and
d. It avoids frequent repetition of, and any undue prominence
being given to the name of the firm or professional accountant in
public practice.
The following however shall not be allowed:
a. Self-laudatory statements
b. Discrediting, disparaging, or attacking other firms or CPA
practitioners
c. Referring to, using or citing actual or purported testimonials
by third parties
d. Publishing and comparing fees with other CPAs or CPA firms
or comparing those services with those provided by another firm
or CPA practitioner
e. Giving too much emphasis on competitive differences
f. Using words or phrases which are hard to define and even
more difficult to substantiate objectively
CHAPTER 4
14 D Par. 6(e), BOA Resolution
no. 126 series of 2008
15 B Pars. 1-6, BOA Resolution
no. 126 series of 2008
16 C Par. 3(b), Annex “B,” Rules
and Regulations
Implementing RA 9298
17 A Par. 3(c), Annex “B,” Rules
and Regulations
Implementing RA 9298
18 D Sec. 35, RA 9298
g. Publishing services in billboard (e.g., tarpaulin, streamers,
etc.) advertisements
A professional accountant may invite clients, staff and other
professional accountants to attend training courses or seminars
conducted for the assistance of the staff. Other persons should
not be invited to attend such training courses or seminars except
in response to an unsolicited request. XXX
1. XXX
2. The use of the name of an international accounting firm
affiliation/correspondence other than a notation that it is a
“member/correspondent firm of that foreign firm” shall
not be allowed so as to imply that the foreign firm is
practicing in the Philippines.
3. No firm or CPA practitioner shall identify the name of a
client or items of a client’s business in advertising, public
relations or marketing material produced to promote his
practice that the client gives its written consent.
4. No firm or CPA practitioner shall use the term
“Accredited” or any similar words or phrases calculated
to convey the same meaning if the claimed accreditation
(BOA, SEC, BSP, IC) has expired.
5. All advertisements must have prior review and approval
in writing by the Risk Management Partner and
Managing Partner on their equivalents.
6. XXX
There is hereby created a Quality Review Committee (QRC) to
conduct an oversight into the quality of audit of financial
statements through a review of the quality control measures
instituted by Individual CPAs, Firms or Partnership in order to
ensure compliance with accounting and auditing standards and
practices, pursuant to Section 9(h), Rule II.
The QRC shall have the following functions:
i. Conduct quality review on applicants for registration to
practice public accountancy and render a report which shall be
attached to the application for registration.
ii. Recommend to the Board the revocation of the
Certificate of Registration and the professional identification
card of an Individual CPA, XXX
Coverage of Temporary/Special Permits. - Special/temporary
permit may be issued by the Board subject to the approval of the
Commission and payment of the fees the latter has prescribed
and charged thereof to the following persons:
(a) A foreign certified public accountant called for consultation
or for specific purpose which, in the judgment of the Board, is
essential for the development of the country: Provided, That
his/her practice shall be limited only for the particular work that
he/she is being engaged: Provided, further, That there is no
Filipino certified public accountant qualified for such
consultation or specific purposes;
CHAPTER 4
19 C Par. 1(a), Annex “B,” Rules
and Regulations
Implementing RA 9298
20 D Par. 6(n), BOA Resolution
no. 126 series of 2008
(b) A foreign certified public accountant engaged as professor,
lecturer or critic in fields essential to accountancy education in
the Philippines and his/her engagement is confined to teaching
only; and
(c) A foreign certified public accountant who is an
internationally recognized expert or with specialization in any
branch of accountancy and his/her service is essential for the
advancement of accountancy in the Philippines.
XXX The registration shall be valid for a period of three (3)
years and may be renewed every three (3) years on or before
September 30 on the year of expiry upon compliance of the
requirements provided in this revised rules and regulations. XXX
A professional accountant may develop and maintain a web site
in the Internet in such suitable length and style which may also
include announcements, press releases, publications and such
other necessary and factual information like firm’s name,
partners/principals’ name and brief description of their
educational attainment, brief listing of services, postal address,
telephone, fax and email addresses. Such website should adhere
to the rules mentioned above.