Auditing theory
1. Professional Accountant
He or she is an individual who holds a valid
certificate issued by the Board of Accountancy (i.e.,
Certified Public Accountant), whether he/she be in
public practice, industry, commerce, the public
sector or education.
Scope of Practice of Professional Accountants
3. Practice of Public Accountancy
This shall constitute in a person, be it in
his/her individual capacity, or as a partner or a staff
member in an accounting or auditing firm, holding
out himself/herself as one skilled in the knowledge,
science and practice of accounting, and as a
qualified person to render professional services as
a certified public accountant.
4. Practice in Commerce and Industry
This shall constitute in a person involved in
decision making requiring professional knowledge
in the science of accounting, or when such
employment of position requires that the holder
thereof must be a certified public accountant.
5. Practice in Education or Academe
This shall constitute in a person in an
educational institution which involve teaching of
accounting, auditing, management advisory
services, finance, business law, taxation and other
technically related subjects.
6. Practice in the Government
This shall constitute in a person who holds,
or is appointed to, a position in the accounting
professional group in government or in a
government-owned and/or controlled corporation,
including those performing proprietary functions,
where decision making requires professional
knowledge in the science of accounting, or where a
civil service eligibility as a certified public
accountant is a prerequisite.
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7. Certified Public Accountant
He or she is a person who, after obtaining
the required education passes an extensive
examination and is licensed by the country to
practice as a professional accountant.
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Regulatory Government Agencies
9. Professional Regulation Commission (PRC)
PRC administers, implements and enforces
the regulatory policies of the National Government
with respect to the regulation and licensing of
various professions under its jurisdiction including
the maintenance of professional standards and
ethics and the enforcement of the rules and
regulations relative thereto.
10. Professional Regulatory Board of Accountancy
(BOA)
This board, consisting of a chairman and six
members, is the agency that is empowered to
administer the Accountancy Law. As a licensing
agency of the government, the board is the only
body that may issue and revoke CPA certificates
and grant licenses to practice.
11. Securities and Exchange Commission (SEC)
This is the government agency that
regulates the registration and operations of
corporations, partnerships and other forms of
associations in the Philippines.
12. Commission on Audit (COA)
This is the agency that audits or determines
whether government units handle their funds
according to existing laws and whether their
programs are being conducted efficiently and
economically.
13. Bureau of Internal Revenue (BIR)
The BIR is responsible for enforcement of
the tax laws, rules and regulations.
Professional Organization
15. Philippine Institute of Certified Public
Accountants (PICPA)
PICPA is the accredited national
professional organization of CPAs. It serves all
members in the different sectors of the accounting
profession. Year-round professional development
programs and regular fellowship and sport
activities are sponsored by the association for its
members.
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Auditing theory
16. Sectoral Professional Organizations
a. Association of CPAs in Public Practice
(ACPAPP)
b. Association of CPAs in Education
(ACPAE)
c. Association of CPAs in Commerce and
Industry (ACPACI)
d. Government Association of CPAs
(GACPA)
Standard Setting Bodies
18. International Federation of Accountants (IFAC)
IFAC has as its mission the development
and enhancement of the profession to enable it to
provide services of consistently high quality in the
public interest. It is a non-profit, non-governmental,
non-political international organization of
accountancy bodies.
19. International Accounting Standards Board
(IASB)
The Board is committed to developing, in the
public interest, a single set of high quality, global
accounting standards that require transparent and
comparable information in general purpose
financial statements.
20. Financial Reporting Standards Council (FRSC)
As the successor of Accounting Standards
Council (ASC), FRSC’s main function is to establish
generally accepted accounting principles (GAAP) in
the Philippines.
21. International Auditing Practices Committee
(IAPC)
The IAPC is a standing committee of the
Council of IFAC and is responsible for the
development and issuance on behalf of the Council,
standards and statements on a variety of audit and
attests functions in order to improve the degree of
uniformity of auditing practices and related
services throughout the world.
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22. Auditing and Assurance Standards Council
(AASC)
The AASC is the body authorized to
establish and promulgate generally accepted
auditing standards (GAAS) in the Philippines.
Philippine Standards Issued by AASC
24. Philippine Standards on Auditing (PSAs)
These standards are applicable to the audit
of historical financial information.
25. Philippine Standards on Review Engagements
(PSREs)
These standards are applicable to the
review of historical financial information.
26. Philippine Standards on Assurance
Engagements (PSAEs)
These standards are applicable to
assurance engagements dealing with subject
matters other than historical financial information.
27. Philippine Standards on Related Services
(PSRSs)
These standards are applicable to related
services such as compilation engagements,
engagements to apply agreed-upon procedures to
information and other related services
engagements as specified by the AASC.
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28. Philippine Standards on Quality Control (PSQC)
These standards are to be applied for all
services falling under the AASCs engagement
standards.
29. Philippine Auditing Practice Statements
(PAPSs)
These provide interpretative guidance and
practical assistance to professional accountants in
implementing Philippine Standards and promote
good practice.
30. AASC Bulletins and AASC Alerts
These refer to a regular publication issued
by the AASC to provide guidance to auditors in the
application of PSAs. These are not part of PSAs and
do not change the requirements of relevant PSAs.