FINANCIAL ACCOUNTING AND REPORTING

This subject tests the examinee's ability to Financial Assets at Amortized Cost
understand and apply accounting principles and Investments in Associates (equity method of
standards relating to: nature and composition of accounting)
accounts, initial recognition, measurement and Basic Derivatives (excluding Hedge Accounting)
valuation, subsequent events and transactions,
subsequent measurement and recognition of losses NON-FINANCIAL ASSETS (10%)
due to impairment and other causes, related Inventories
party transactions, financial statement presentation Property, Plant and Equipment
and disclosures. Investment Property
Intangibles
New standards and other issuances are included in Biological Assets
the exam if these are in effect for at least 6 months Non-Current Assets Held For Sale
at the date of the exam.
LIABILITIES (10%)
The FAR exam is a 3-hour exam. It consists
of 70 multiple choice questions (Theory and FINANCIAL LIABILITIES
problems) Accounts Payable and Other Trade Payables
Debt Restructuring
DEVELOPMENT OF FINANCIAL
REPORTING FRAMEWORK, STANDARD- NON-FINANCIAL LIABILITIES
SETTING BODIES, REGULATION OF THE Premiums and warranties
ACCOUNTANCY PROFESSION, Unearned revenues for gift certificates and
CONCEPTUAL FRAMEWORK OF subscriptions
FINANCIAL STATEMENTS AND
ACCOUNTING PROCESS (5.71) PROVISIONS AND CONTINGENCIES
Recognition and measurement criteria
Development of Financial Reporting Framework
Standard-Setting Bodies (AASC, FRSC,PIC)
Regulation of the Accountancy Profession EQUITY (14.28%)
Conceptual Framework Share Capital Transactions (PAS 32, PFRS 7)
Accounting Process (Adjusting Entries and Dividends
Accounting Cycle) Retained Earnings
Other Comprehensive Income
PRESENTATION OF FINANCIAL Book Value per share and Earnings per Share
STATEMENTS (14.29%)
OTHER TOPICS (14.29%)
Statement of Financial Position (SFP) Share-based payments (PFRS 2)
Statement of Comprehensive Income Borrowing Costs (PAS 23)
Statement of Cash Flows Leases (PAS 17/ PFRS 16)
Statement of Changes in Equity Income Tax (PAS 12, PFRS 14)
Notes to the Financial Statements Employee Benefits (PAS 19, PAS 26)
Interim Reporting (PAS 34, PAS 24)
ASSETS Segment Reporting (PFRS 8)
Cash to Accrual
FINANCIAL ASSETS (14.29%)
Cash & Cash Equivalents
Loans and Receivables (Financial Assets at SMALL AND MEDIUM SIZED ENTITIES/
Amortized Cost) MICRO ENTERPRISES (5.71%)
Investments in Debt Instruments Small and Medium Sized Entities (Reporting
Financial Assets at Fair Value through Profit or Requirements, Peculiarities, Principles for reporting
Loss (Except Derivatives) Investments in Debt and Equity Securities)
Financial Assets at Fair Value through Other Micro Enterprises
Comprehensive Income

ADVANCED FINANCIAL ACCOUNTING AND REPORTING (AFAR)

This section tests the examinee's knowledge of the of these concepts, techniques and methodology to
concepts and principles in advanced financial problems encountered in practice.
accounting and reporting as well as the application

New standards and other issuances are included in
the exam if these are in effect for at least six 6 months
at the date of the exam.
The exam consists of 70 multiple choice questions
(Theory and problem)
PARTNERSHIP ACCOUNTING (14.29%)
Formation, Operations, Dissolution (Admission,
Withdrawal, Incorporation of a partnership),
Liquidation (Lump-sum method and Installment
Method)
CORPORATE LIQUIDATION (5.71%)
Statement of Affairs, Statement of
Deficiency, Statement of Realization and
Liquidation, Determination of the order of priority
of claimants of company assets subject to
liquidation
JOINT ARRANGEMENTS - PFRS 11 (5.71%)
 Joint Operations
 Joint Venture (equity method)
 Accounting for SME
REVENUE RECOGNITION - PFRS 15
(14.29%)
 Installment Sales (PAS 18/ PFRS 15)
 Long-term Construction Contracts (PAS 11/
PFRS 15)
 Franchise Operations – Franchisor's point of
view (PAS 18/ PFRS 15)
 Consignment Sales (PAS 18/ PFRS 15)
ACCOUNTING FOR HOME OFFICE,
BRANCH AND AGENCY TRANSACTIONS
(5.71%)
ACCOUNTING FOR BUSINESS
COMBINATION -PFRS 3 (8.57%)
 Acquisition of assets and liabilities
(acquisition method);
o Determination of Consideration
Transferred; Recognition of
Acquired Assets and Liabilities;
Recognition and Measurement of
Goodwill and Gain from a Bargain
Purchase; Journal Entries;
 Financial Statement Presentation;
 Accounting for SME
SEPARATE FINANCIAL STATEMENTS -
PAS 27 (5.71%)
 Accounting for Investment in Subsidiary
o at cost, equity method, and in
accordance with PAS 39/PFRS 9
 Accounting for SME
CONSOLIDATED FINANCIAL
STATEMENTS - PFRS 10 (7.14%)
Consolidated Financial Statement in Subsidiary
 Date of acquisition
 Subsequent to date of acquisition
 Determination of:
o Net Income/Total Comprehensive
Income/Equity
 Attribution to Equity Holders
of Parent/Controlling or
Parent’s Interest,
 Non-controlling Interest,
 Consolidated/ Group,
o Retained Earnings/ Common Share /
Dividends
 Attributable to Equity
Holders of Parent
/Controlling or Parent’s
Interest/, Consolidated /
Group,
o Accounting for SME
FOREIGN CURRENCY TRANSACTIONS
(5.71%)
 Without hedging activities (import, export,
lending, and borrowing transactions)
 Hedging Activities: Hedging Foreign
Currency Exposures, Foreign Currency
Forward Contacts
o Hedges that not requires a Hedge
Accounting (undesignated hedges)
o Hedges that requires a Hedge
Accounting (Fair value hedge, Hedge
of a Firm Commitment, Cash flow
hedge, Hedge of a Forecasted
Transaction (purchase or sale
transaction)
o Hedge of a net investment in foreign
entity
o Accounting for SME
TRANSLATION OF FOREIGN CURRENCY
FINANCIAL STATEMENTS - PAS 21/ PAS 29
(4.29%)
 Translation from the functional currency to
the presentation currency (Closing/ Current
Rate Method)
 Remeasurement from a foreign currency to
the functional currency (Temporal Method)
 Restatement of Financial Statements
NOT-FOR-PROFIT ORGANIZATIONS
(2.86%)
 Voluntary health and welfare organizations
(VHWO)
 Hospitals and other health care organizations
 Colleges and universities
 Other not-for-profit organizations such as
churches, museums, fraternity association,
etc.
GOVERNMENT ACCOUNTING – GENERAL
FUND (2.86%)
 Basic Concepts, Budget Process, Journal
Entries – Books of National Government
Agency
OTHER SPECIAL TOPICS (2.86%)
 Insurance Accounting (Insurer)
 Build, Operate, and Transfer (PFRIC 12)
 IFRS for SMEs
COST ACCOUNTING (14.29%)
  System of cost Accumulation or Costing  Accounting for joint and by – products
System  Standard Costing (two-way variance
 Job-order costing system excluding mix and yield variances)
 Process costing system  Service Cost Allocation
 Backflush costing system (JIT system)
 Service Cost Allocation
 Activity-based costing system (ABC
costing)
TAXATION

This subject tests the examinee's knowledge of the o Reconciliation of income under
principles and concepts of taxation and the practical PFRS and income under Tax
application of these principles and concepts. Accounting
 Tax return preparation and filing and tax
New laws, IRRs, jurisprudences, and other issuances payments
are included in the exam if these are in effect for at o Manual filing
least 6 months at the date of the exam. o Electronic filing and E-submission
o Large taxpayers and non-large
Tax rates are provided in the examination. The exam taxpayers
consists of 70 multiple choice questions. o Income tax credits
1. Principles of taxation (11.43%) o Venue and time of filing of tax
 Nature, scope, classification, and essential returns
characteristics o Venue and time of payment
 Principles of sound tax system o Modes of payment
 Limitations on the power of taxation o Use of tax tables
 Tax evasion vs. tax avoidance o Accomplishing of various income
 Situs / place of taxation tax returns and forms
 Double taxation  Withholding taxes (at source, expanded
 Legislation of tax laws or creditable withholding tax, final
 Impact of taxes in nation building withholding taxes and withholding tax on
 Ethical tax compliance and administration government payments)
 Organization of the BIR, BOC, BOI, PEZA, o Time of withholding
and Local Government Tax Collecting units o Income payments subject to
2. Tax remedies (11.43%) withholding
 Remedies of the taxpayer o Year end withholding of tax and
 Remedies of the Government requirements
 Expanded jurisdiction of the Court of Tax o Venue and time of filing of
Appeals withholding tax returns
3. Income taxation (20%) o Venue and time of payment
 Taxpayer and tax base o Modes of payment
o Individuals, Corporations, Partnershi o Time of payment
ps, Joint ventures, Estates and o Use of tax tables and rates
trusts, Co-ownerships, Tax exempt o Use of various withholding tax
individuals and organizations returns and forms
 Gross income  Compliance Requirements
o Inclusions in the gross income o Administrative requirements
o Exclusions/exemptions from gross (registration, issuance of receipts,
income printing of receipts)
o Compensation Income o Attachments to the income tax return
o Business Income o Keeping of books of accounts and
o Passive income subject to final records, including report of
withholding tax inventories
o Capital gain o Prescriptive period of maintain
 Deductions from gross income books of accounts and other
o Itemized deductions accounting records
o Items not deductible 4. Transfer taxes (17.14%)
o Optional standard deduction  Estate Tax
o Deductions allowed under special  Donor's Tax
laws 5. Value added tax and percentage tax (17.14%)
 Accounting periods  Value Added Tax
 Accounting methods  Percentage Tax
6. Documentary stamp tax (2.85%)
 Describe, Analyze and Compute
Documentary Stamp Tax (Definition,
Coverage and Exemptions, Tax Base Rates,
and Time and Manner of Payment)
7. Excise tax (2.85%)
 Describe, Analyze and Compute Excise
Tax (Concept, Applicability, Classification
of Excisable Materials and Rates, Specific
Tax, Ad Valorem Tax, Coverage, Time of
Payment)
8. Taxation under the local government code
(5.73%)
 Scope and different types of local taxes, Tax
base and tax rates, Venue and time of filing
of tax returns and payment).
 Limited to Real Property Tax and Local
Business Tax
9. Preferential taxation (11.43%)
 Senior Citizens Law
 Magna Carta for Disabled Persons
 Special Economic Zone Act (PEZA)
 Omnibus Investments Code (E.O. 226, Book
1)
 Barangay Micro Business Enterprises Act
(BMBE)
 Double Taxation Agreements (DTA)
Tarrifs and Customs Code and Updates on special
concerns have been removed.

AUDITING

The auditing exam tests the examinee's knowledge of  PSA 210 (Redrafted)
the auditing principles and concepts and the practical  PSA 300 (Redrafted)
application of these principles and concepts.  PSA 240 (Redrafted)
 PSA 250 (Redrafted)
New auditing standards and other issuance are  PSA 260 (Redrafted)
included in the exam if these are in effect for at least  PSA 610 (Redrafted)
6 months at the date of the exam.  PSA 620 (Revised and
Redrafted)
The Auditing exam is a 3-hour exam. It consists  Understanding the Entity and its
of 70 multiple choice questions. The exam is divided Environment Including its Internal
into two sections: Auditing Theory and Auditing Control and Assessing the Risks of
problems Material Misstatement
o APPLICABLE STANDARDS:
 PSA 260 (Revised and
AUDITING THEORY (50%) Redrafted)
This section covers the candidates' conceptual  PSA 265 (New)
knowledge and understanding of assurance and  PSA 315 (Redrafted)
related services performed by professional  PSA 320 (Revised and
accountants. The Philippine Standards on Auditing Redrafted)
(PSA) and other regulatory laws and regulations in  Audit Objectives, Procedures, Evidences
effect at the time of examination are applied in all and Documentation
areas of the exam. o APPLICABLE STANDARDS:
 Fundamentals of Auditing and Assurance  PSA 230 (Redrafted)
Services  PSA 330 (Redrafted)
o APPLICABLE STANDARDS  PSA 500 (Redrafted)
 Glossary of Terms  PSA 501 (Redrafted)
(December 2002)  PSA 505 (Revised and
 IAASB – Interim Terms of Redrafted)
Reference (August 2004);  PSA 510 (Redrafted)
Philippine Framework for  PSA 520 (Redrafted)
Assurance Engagement  PSA 530 (Redrafted)
 Preface to International  PSA 540 (Revised and
Standards and Philippine Redrafted)
Standards  PSA 550 (Revised and
 PSA 120 - Framework of Redrafted)
Philippine Standards on  Completing the Audit/ Post-Audit
Auditing Responsibilities
 The Financial Statements Audit - Client o APPLICABLE STANDARDS:
Acceptance, Audit Planning, Supervision  PSA 560 (Redrafted)
and Monitoring  PSA 570 (Redrafted)
o APPLICABLE STANDARDS:  PSA 580 (Revised and
 PSA 200 (Revised and Redrafted)
Redrafted)  Reports on Audited Financial Statements
 o APPLICABLE STANDARDS: Evidence Accumulation and Evaluation –
 PSA 700 (Redrafted) Substantive Tests of Transactions and Balances
 PSA 705 (Revised and
Redrafted) Audit of the revenue and receipt cycle
 PSA 706 (Revised and  Audit of sales and revenue transactions
Redrafted)  Audit of receivable balances
 PSA 710 (Redrafted) Audit of expenditure and disbursement cycle
 PSA 720 (Redrafted)  Audit of acquisitions and purchases
 PSA 800 (Revised and  Audit of payroll transactions
Redrafted)  Audit of inventory balances
 PSA 805 (Revised and  Audit of trade payable balances
Redrafted)  Audit of prepaid expenses and accrued
 PSA 810 (Revised and liabilities
Redrafted) Audit of production cycle
 Auditing in a Computerized Information  Audit of conversion activities
Systems (CIS) Environment  Audit of inventory balances: work-in-
o APPLICABLE STANDARDS: process and finished goods
 PSA 402 (Revised and  Audit of cost of goods sold balance
Redrafted) Audit of the financing cycle
 Other Assurance and Non-assurance  Audit of financing cycle transactions
Services  Audit of non-trade liability balances
o APPLICABLE STANDARDS:  Audit of interest expense and finance cost
 PSA 220 (Revised and balances
Redrafted)  Audit of equity accounts
 Audit of investing cycle
AUDITING PROBLEM (50%) Audit of the financing cycle
This section tests the examinee's proficiency in  Audit of investing transactions
applying auditing standards, techniques, and  Audit of investment account balances
procedures to a typical independent audit of a  Audit of property, plant and equipment
medium-sized service, trading or manufacturing account balances
concern. The examinee must be able to plan  Audit of intangible account balances
and perform an audit, analyze data for possible Audit of cash balances
errors and irregularities, formulate adjusting entries,  Audit of cash receipt transactions balance
resolve audit issues, prepare audit working papers  Audit of cash disbursement transactions
and complete the audit including the preparation of balance
the audit report.

MANAGEMENT ADVISORY SERVICES

This exam tests the examinee's knowledge of the
concepts, methodology and techniques in
management accounting, financial management and
management consultancy.
The MAS exam is a three-hour exam. It consists of
70 multiple choice questions. (Theory and
Problems)
MANAGEMENT ACCOUNTING (50%)
 Objectives, role and scope of management
accounting
 Management accounting concepts &
techniques for planning and control
o Cost Terms, Concepts, and
Behaviour
o Cost Accumulation Methods (Job
Order, Process, ABC)
o CVP Analysis
o Standard costing and variance
analysis
o Variable costing and absorption
costing
o Financial Planning and Budget
o Activity-based costing (ABC) and
activity-based management (ABM)
o Strategic cost managements
 Management Accounting Concepts &
Techniques for
Performance Measurement
o Responsibility Accounting and
Transfer Pricing
o Balanced Scorecard
 Management Accounting Concepts &
Techniques for Decision Making
o Quantitative Techniques
o Relevant Costing and Differential
Analysis
FINANCIAL MANAGEMENT (40%)
 Objective and Scope of Financial
Management
 Financial Management Concepts and
Techniques for Planning, Control and
Decision Making
o Financial Statement Analysis
o Working Capital Finance
 o
Capital Budgeting Management Consultancy practice by CPAs
o
Investment Risks, and Rates of Project Feasibility Studies
Returns ECONOMIC CONCEPTS (5.7%)
o Types and measurement of risks and  Macroeconomics
returns, risk measurement models  Microeconomics
o Capital structure and long-term
financing decision
MANAGEMENT CONSULTANCY (4.3%)

REGULATORY FRAMEWORK FROM BUSINESS TRANSACTIONS (RFBT)

This section tests the examinee's knowledge of the

regulatory framework governing business
transactions and business organizations/
associations, and of business laws including their
legal implications.

The RFBT exam is a three-hour exam. It consists of

100 multiple choice questions.

LAW ON BUSINESS TRANSACTIONS

 Obligations (10%)
 Contracts (10%)
 Sales (7%)
LAW ON CREDIT TRANSACTIONS
 Pledge, Real Mortgage, and Chattel
Mortgage (4%)
NEGOTIABLE INSTRUMENTS AND
BOUNCING CHECKS LAW
 Negotiable Instruments (4%)
 Bouncing Checks (2%)
LAWS ON BUSINESS ORGANIZATIONS
 Partnership (10%)
 Corporations (28%)
o Including: Securities Regulations
Code, Code of Corporate
Governance, and SEC Circulars and
Ordinances on Filling, Fines and
Penalties.
 Cooperatives (10%)
LAWS ON OTHER BUSINESS
TRANSACTIONS
 Philippine Deposit Insurance Corporation
(PDIC) (2%)
 Secrecy of Bank Deposits and Unclaimed
Balances Law (2%)
 Anti-Money Laundering Act (AMLA) (5%)
 Intellectual Property Law (2%) EXCEPT
PART 1 OF R.A. 8293
 Data Privacy Act (2%)
 Electronic Commerce Act (1%)
 Ease of Doing Business Law (1%) NEW
General Banking Laws (GBL), Financial
Rehabilitation and Insolvency Act (FRIA), Updates
on special concern have been removed. Ease of
Doing Business Law (RA 11032) has been added.