You are on page 1of 11

ARTICLE V

ACCOUNTANCY REGULATORY OFFICE
Section 37. Creation of the Accountancy Regulatory Office. - The Accountancy
Regulatory Office, ( “ARO”) shall be created. The ARO shall be under the supervision
and administrative control of the Professional Regulation Commission or any other
government office that the President of the Philippines may designate. The ARO shall be
headed by an Executive Director whose salary shall be equivalent to that of the
Chairman of the Board of Accountancy
Section 38. Powers and Functions of the ARO. - The ARO shall exercise the following
specific powers, functions and responsibilities:
a) To prescribe and adopt the rules and regulations necessary for regulating the
accountancy profession and carrying out the provisions of this Act;
b) To supervise the practice of accountancy in the Philippines;
c) To issue, suspend, revoke, reinstate the Certificate of Accreditation that may
be prescribed for the practice of the accountancy profession;
d) To administer and implement the Continuing Professional Development
Program
e) To conduct an oversight into the quality of audits of financial statements and
operations of certified public accountants though a quality assurance review
of the control and practice operational measures instituted by auditors in
order to ensure compliance with the accounting and auditing standards, rules,
regulations and practices,. For this, the ARO may disclose the results of the
review it has conducted to provide feedback to the certified public
accountants on their practice of profession
f) To adopt an official seal of the ARO ;
g) To monitor the conditions affecting the practice of accountancy and adopt
such measures, including promulgation of, rules and regulations and best
practices as may be deemed proper for the effective regulation of the
accountancy profession. That, the special requirements of Micro ,Small and
Medium Business Enterprises shall be considered in the promulgation of the
standards, rules and regulations
h) To investigate violations of this act and the rules and regulations promulgated
hereunder and for the purpose, to issue summons, subpoena and subpoena
ad testificandum and subpoena duces tecum to violator or witness thereof
and compel their documents in connection therewith: Provided, That the ARO
upon approval and concurrence of the Commission may, subject to such
rules and regulations that may be promulgated to implement this section,
delegate the fact-finding aspect of such investigations to the accredited
national professional organization of certified public accountant: Provided,
further, That the ARO and/or the Commission may adopt their findings of fact
as may be seems fit; The ARO may, muto propio in its discretion, may such

Organization and staffing plan for the ARO. . resolutions or orders rendered in the administrative cases shall be subject to review only if on appeal: Section 39. any accounting or auditing standards or rules of duly promulgated by the ARO as part of the rules governing the practice of accountancy in the Philippines.The organization structure and the staffing plan of the ARO shall be prepared by the Board of Accountancy. partnership or corporation engaged in violation of any provision of this Act. With the concurrence of the Commission. the organization and staffing plan shall be referred to the Department of Budget and Management for evaluation and approval thereof. where such fees collected will be held in trust as a “Quality Assurance Review Fund” by the ARO in a trust fund. in accordance with the pertinent provision of and penalties prescribed by the Rules of Court. In the preparation. the ARO Board's decisions. The policies resolution. no portion thereof or any of its income shall accrue to the General Fund of the National Government. k) To implement a Whistleblower Program that will encourage the reporting of instances of violations of the provisions of this Act . Section 40. the express powers granted to the Board to achieve the objectives and purposes of this Act. i) To issue a cease or desist order to any person. . standards and Implementing Rules and Regulations l) To pursue the development and upliftment of the public practice of the Small and Medium Practitioners (SMP). However. merger of strengthening of the organization of the SMPs m) To exercise such other powers as may be provided by law as well as those which may be implied from. both direct and indirect.investigations as it deem necessary to determine whether any person has violated any provisions of this law. The fund will partially finance the quality assurance review activities and allowances that shall be paid to the quality inspectors or reviewers who will be conducting the Quality Assurance Review of the ARO. Quality Assurance Review Fund. j) To punish for contempt of the ARO . The ARO is authorized collect fees in the course of regulatory function. associations. or which are necessary or incidental to the carrying out of. any accounting or auditing standard or rules duly promulgated by the ARO as part of the rules governing the practice of accountancy. rules and regulations issued or promulgated by the ARO shall be subject to review and approval of the Commission. including but not limited to the consolidation. the Board shall consider the requirements to discharge the functions prescribed in Section 38..

what's the difference? These terms are often used interchangeably. not your employer focus on learning from experience. It's to do with learning how to do something specific. It's not a tick-box document recording the training you have completed. Training can be as simple as using a PC application and as complex as learning how to be a pilot. managing projects or organising information. The term is generally used to mean a physical folder or portfolio documenting your development as a professional. review and document your learning and to develop and update your professional knowledge and skills. It involves progression from basic know-how to more advanced. It can help you to reflect. Training and development . reflective learning and review help you set development goals and objectives include both formal and informal learning. A subpoena ad testificandum is a court summons to appear and give oral testimony for use at a hearing or trial. a CPD needs to:      be a documented process be self-directed: driven by you. though there is a distinction. mature or complex understanding. The key features of the CPD process To justify the name. knowledge and experience that you gain both formally and informally as you work. A subpoena duces tecum (pronounced /səbˈpiːnəˌduːsəsˈteɪkəm/) (or subpoena for production of evidence) is a court summons ordering the recipient to appear before the court and produce documents or other tangible evidence for use at a hearing or trial. It's a record of what you experience. It refers to the process of tracking and documenting the skills. giving you the tools to do a range of things and relating to capability and competency. It's function is to help you record. It's broader than that. training is formal and linear. learn and then apply. review and reflect on what you learn. What will it do for you? A CPD may be a requirement of membership of a professional body. It is also very useful to:         provides an overview of your professional development to date reminds you of your achievements and how far you've progressed directs your career and helps you keep your eye on your goals uncovers gaps in your skills and capabilities Opens up further development needs provides examples and scenarios for a CV or interview demonstrates your professional standing to clients and employers helps you with your career development or a possible career change. This article is about CPD as a process of recording and reflecting on learning and development. What is it for? The CPD process helps you manage your own development on an ongoing basis. Development is often informal and has a wider application. beyond any initial training.What does CPD mean? CPD stands for Continuing Professional Development. As a rule of thumb. Some organisations use it to mean a training or development plan. The use of a writ for purposes of compelling testimony originated in the Ecclesiastical . which I would argue is not strictly accurate. Alternatively it can be about widening your range of transferable skills like leadership. relating to skill and competence.

are believed to employ the majority of professional accountants working in practice. in many areas of the world.and medium-sized entities (SMEs). commonly referred to as engines of growth and innovation. especially in England. Furthermore.Courts of the High Middle Ages. The use of the subpoena writ was gradually adopted over time by other courts in England and the European Continent. Mergers and Acquisitions: Valuation Matters By Ben McClure . Small.and medium-sized practices (SMPs) are a critically important part of the profession: they constitute the vast majority of accountancy practices worldwide and. SMPs typically serve small.

. Mergers and Acquisitions: Introduction 2. In order to do so. Mergers and Acquisitions: Definition 3. Naturally.1. they must ask themselves how much the company being acquired is really worth. both sides of an M&A deal will have different ideas about the worth of a target company: its seller will tend to value the company at as high of a price as possible. Mergers and Acquisitions: Conclusion Investors in a company that are aiming to take over another one must determine whether the purchase will be beneficial to them. Mergers and Acquisitions: Doing The Deal 5. while the buyer will try to get the lowest price that he can. Mergers and Acquisitions: Break Ups 6. Mergers and Acquisitions: Why They Can Fail 7. Mergers and Acquisitions: Valuation Matters 4.

people and ideas .With the use of this ratio.A key valuation tool in M&A. Replacement Cost . The acquiring company can literally order the target to sell at that price. while being aware of the price-to-sales ratio of other companies in the industry. Naturally. an acquiring company makes an offer that is a multiple of the earnings of the target company. suppose the value of a company is simply the sum of all its equipment and staffing costs.With this ratio.There are. or it will create a competitor for the same cost. Comparative Ratios .are hard to value and develop. Looking at the P/E for all the stocks within the same industry group will give the acquiring company good guidance for what the target's P/E multiple should be. discounted cash flow analysis determines a company's current value according to its estimated future cash flows. many legitimate ways to value companies. but deal makers employ a variety of other methods and tools when assessing a target company. Here are just a few of them: 1. again. the acquiring company makes an offer as a multiple of the revenues. Forecasted free cash flows (net income + depreciation/amortization .The following are two examples of the many comparative metrics on which acquiring companies may base their offers:  Price-Earnings Ratio (P/E Ratio) .capital expenditures . acquire property and get the right equipment. For simplicity's sake.In a few cases. This method of establishing a price certainly wouldn't make much sense in a service industry where the key assets . 2. Discounted Cash Flow (DCF) .  Enterprise-Value-to-Sales Ratio (EV/Sales) . The most common method is to look at comparable companies in an industry. 3.change in working capital) are discounted to a present value using the company's weighted . it takes a long time to assemble good management. however. acquisitions are based on the cost of replacing the target company.

regardless of what pre-merger valuation tells them. Let's face it.asp#ixzz4LiWb5AB u Follow us: Investopedia on Facebook . Synergy: The Premium for Potential Success For the most part. a merger benefits shareholders when a company's post-merger share price increases by the value of potential synergy. DCF is tricky to get right. but few tools can rival this valuation method. it would be highly unlikely for rational owners to sell if they would benefit more by not selling. the premium represents part of the post-merger synergy they expect can be achieved.com/university/mergers/mergers2. The equation solves for the minimum required synergy: Read more: Mergers and Acquisitions: Valuation Matters | Investopedia http://www. acquiring companies nearly always pay a substantial premium on the stock market value of the companies they buy. Admittedly.average costs of capital (WACC). That means buyers will need to pay a premium if they hope to acquire the company. that premium represents their company's future prospects. The following equation offers a good way to think about synergy and how to determine whether a deal makes sense. For sellers. For buyers.investopedia. The justification for doing so nearly always boils down to the notion of synergy.