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Lib Re

Lib Re

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Published by: Wes Harven Maravilla on Dec 03, 2011
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12/03/2011

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Libre: Poster girl of misunderstood profession By Mel Libre Free Verse SINCE the downfall of the biggest auditing

firm in the world, Arthur Andersen, due to the Enron scandal in 2001 (and the convictions for obstruction of justice for the shredding of documents related to its audit of Enron), government agencies (including the Securities and Exchange Commission and the Bureau of Internal Revenue in the Philippines) have adopted rules and regulations to clamp down on unprofessional conduct among certified public accountants (CPAs).The goal is to ensure that business entities properly report their income not just for computing the correct taxes that is the lifeblood of government but also that stakeholders and prospective investors make proper business decisions. Last December, Estelita Aguirre, former BIR Deputy Commissioner and currently president of Asian Institute of Taxation (AIT), came to visit her daughter in Auckland, New Zealand. I had a chance to invite her to my home in Glen Eden, Waitakere. She told me about her newfound mission of coaching CPAs towards becoming more effective in their work and meeting the challenges of the demands of the profession. In AIT’s webpage, there are testimonies of participants. One said, “It was indeed a great Black Saturday coaching experience for me. I for one feel great and proud to have the AIT Team as our guiding lights in our professional growth and may I say that without you we might not hold long with our profession (kawawa naman di ba?). Thank you for sharing your knowledge with us.”It is good that there are people like Aguirre who are passionate in professional development. But as I understand, there is friction between the Board of Accountancy (BoA), the body that prepares the CPA licensure examinations, and the Philippine Institute of Certified Public Accountants (Picpa), the professional organization that I once headed in 1998. This is because there are just too many other requirements for a CPA to practice the profession.I asked a Cebu practitioner about how things were going in his public practice, to which he replied that it has become very difficult due to additional licenses from many agencies. He thinks that only the bigger auditing firms and their staff can secure the big corporate clients. My friend told me that he intends to let go of his corporate clients, and maintain the small ones.I am of the belief that the regulatory agencies (SEC, BIR and BoA) have over-regulated the profession, putting too much emphasis on making complex basic principles and measuring professionalism based on the hours spent on trainings and seminars. Enter auditor Heidi Mendoza, who has testified about the irregularities in the Armed Forces of the Philippines (AFP). Former Ombudsman Simeon Marcelo speaks of her highly, as “her body of work spoke for herself, and her reputation as a no-nonsense auditor preceded her.” Accountants need a hero, and Mendoza, through honesty, courage and love of country, is definitely the poster girl of this misunderstood profession. What regulatory agencies should focus is values and ethics. For that is what is often lost in the education of CPAs. I had always thought that my generation of CPAs were idealistic, having abhorred the corrupt Marcos regime. But I know of a number of my colleagues who were sucked into the system.“The Filipino CPA Shines” was the theme I used during the 1998 National Convention of CPAs in Cebu. There is still much work to be done to make the slogan true. Published in the Sun.Star Cebu newspaper on February 05, 2011. REACTIONS: Hannah Verano Accountants are very important in a business since they are the ones keeping the records of a company. Their role are not just to that extent, they should also ensure that companies report their income properly and compute their taxes correctly since this also benefits the government because taxes are their lifeblood and not only that, through their a transparent reports they help stakeholders and prospective investors in making the proper decisions. So accountants should be with values and ethics to prevent business downfall, they should be a man of principle to promote justice and fight against fraud. In that way we can be called a “Filipino Accountant that shines”. Justine Aspacio In the article that I have read, I realized that there are some companies who let go of good accountants due to lack or less certificates issued by government agencies. For me, this should not be a great factor especially in hiring an accountant because what matters most is not how many certificates an accountant have but it is about how he handles or does his job. I think this is one of the reasons why some companies are being fraud by their own accountants and auditors that lead to the company's downfall. Siedah Bering Corporate fraud and financial reporting scandals have raised significant questions about accountants' ethics and the accounting profession's ability to perform its role in reducing information risk for investors. If accountants are to regain the public's trust, business entities, professional organizations, public accounting firms, and accounting educators must all search for ways to ensure that accountants are poised to make appropriate ethical choices even in difficult situations. A myriad of factors can affect an individual's ethical choices. The more that is understood about these influences the better the profession can prepare accountants to face ethical challenges.

A firm that audits. and fines connected therewith. It shall also give effect to and administer supervisory and police powers conferred to it by the National Internal Revenue Code and special laws. Insurance Answer: B .a person or group with a direct interest. PCIPA c. It is the body that prepares the CPA licensure exam? a.to take firm action to limit something bad or control somebody doing something bad Stakeholders. an American energy company based in Houston. to prevent fraud and auditing failure. Taxes c.AUDIT MODEL GROUP 1 Key Terms: Auditing Firm. and the dissolution of Arthur Andersen. Shredding. TAYO. or investment in something AIT. including the execution of judgments in all cases decided in its favor by the Court of Appeals and the ordinary courts. Texas. Enron Scandal. penalties. Profit d. and enforcement of all forfeitures. IKAW. In addition to being the largest bankruptcy reorganization in American history at that time.the bankruptcy of the Enron Corporation. Income b. Clamp down. Enron was attributed as the biggest audit failure. BAO Answer: C 2. It is called the lifeblood of the government? a.(Securities and Exchange Commission) A government commission created by Congress to regulate the securities markets and protects investors. involvement. BOA d.(Bureau of Internal Revenue)Assessment and collection of all internal revenue taxes. PICPA b.to reduce a document to unreadable strips in a shredder SEC. An institute that envisions that individual member excel in the field of ACCOUNTANCY through sharing of knowledge and linkages. BIR. Multiple Choice 1. which was one of the five largest audit and accountancy partnerships in the world.(Asian Institute of Taxation) They developed the “BAYANIHAN SPIRIT” giving AIT a new meaning AKO. fees and charges.

Who are the regulating Agencies of the accounting profession? • • • SEC BIR BOA 2. ethics and is dedicated to his profession? A certification is just a mere piece of paper issued by agencies as a proof or a title given to a person who complied with all the requirements of that agency. Values b. . What are often lost in the education of the CPA that regulatory agency should focus? a. we could test he is indeed worthy of the title Certified Public Accountant. But a certification is not enough to prove that he is indeed of good moral and ethics.ENUMERATION 1. We must look at his actions and how he handles the job given to him. I agree that it is one of the assurance that an accountant is of good moral and ethics because he is entitled of what is written in the certificate. Ethics ESSAY: Are the additional certificates issued by many agencies assures that an accountant is of good moral. In that case.

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