1.

Under SEC SRC Rule 68, as amended, Group B regulated entities include
I. Brokers and Dealers of securities
II. Investment Companies
III. Government Securities Eligible Dealers (GSEDs)
IV. Universal Banks Registered as Underwriters of Securities
V. Investment Company Advisers
VI. Clearing Agency and Clearing Agency as Depository
VII. Stock and Securities Exchange/s
VIII. Special Purpose Vehicles and Corporations
IX. Other companies mandated by other regulatory agencies to have an independent
auditor accredited by the Commission
a. I, II, III, IV, V, VI, VII, VIII, and IX
b. I, II, III, IV, V, VI, VII, and VIII
c. I, II, III, IV, V, VI, and VII
d. I, II, III, IV, V, and VI

2. The following statements relate to the accreditation requirements of independent auditors of

regulated entities under Securities and Exchange Commission (SEC) Securities Regulations
Code (SRC) Rule 68, as amended. Which is incorrect?
a. The applicant shall be accredited with the BOA of PRC.
b. At the time of application, the applicant shall have an experience of at least 5 years in
external audit as an in-charge, manager, partner or its equivalent.
c. The applicant must have adequate policies and procedures related to the elements of the
system of quality control provided under PSQC 1.
d. The applicant need not have sufficient knowledge on the regulatory requirements,
operations and functions of companies for which he is applying for accreditation.

3. Statement 1: The independent auditors or in the case of auditing firm, the signing partner,
of the regulated entities under SEC SRC Rule 68, shall be rotated after every 5 years of
engagement.

Statement 2: A two-year cooling off period shall be observed in the re-engagement of the
signing partner or individual auditor who was rotated.
a. True, true c. False, true
True, false d. False, False
4. For stock corporations filing under Part I of SRC Rule
68 (and therefore not covered by Part II), the independent auditors shall issue a stating that
the company has a total number of stockholders owning one hundred (100) or more shares
each.
a. Supplemental written statement
b. Supplemental management letter
c. Supplemental auditor’s report
d. Supplemental management report

5. In addition to the requirements prescribed under Part I of Rule 68, as amended, Part II of the
Rule prescribes special requirements on the financial statements required to be filed with the
SEC by
I. An issuer which has sold a class of its securities pursuant to a registration under Section 12
of the SRC
II. An issuer with a class of securities listed for trading on an Exchange
III. An issuer with assets of a least P50,000,000 and has 200 or more holders, each holding at
least 100 shares of a class of its equity securities as of the first day of the issuer’s fiscal
year.
a. I only c. I and II only
b. II and III only d. I, II and III

6. The financial statements to be filed with the SEC shall be presented in comparative form. The
audited balance sheets of statements of financial position shall be as of the end of each of the
most recently completed fiscal years.
a. 2 c. 4
b. 3 d. 5

7. Under Part II of SRC Rule 68, for the registrant and its subsidiaries, audited statement of
comprehensive income in a comparative format for each of the most recent completed fiscal
year
a. two
b. three
c. four
d. five

8. The financial statements—which should have at least a Statement of Financial Position (Balance
Sheet) or a Statement of Fund Balance, Income Statement (or a Statement of Receipts and
 Disbursements) and applicable explanatory notes—of companies not covered by SRC Rule 68
(e.g., stock corporations with less than P50,000 paid up capital stock) should be accompanied
by a
a. Certification under oath by the company’s Treasurer or Chief Finance Officer
b. Certification by the company’s Treasurer or Chief Finance Officer
c. Independent auditor’s report
d. Certificate of Compilation

Cooperative Development Authority (CDA)

9. In accordance with Cooperative Development Authority (CDA) MC No. 2009-03, the external
auditor shall disclose to CDA Extension Office where the cooperative is registered the auditor’s
adverse findings (e.g., material fraud) within after discovery.
a. 10 calendar days
b. 15 calendar days
c. 30 calendar days
d. 45 calendar days
10. In accordance with Cooperative Development Authority (CDA) MC No. 2009-03, the external
auditor shall disclose to CDA Extension Office where the cooperative is registered the auditor’s
termination or resignation before audit completion and discovery of material breach of
cooperative laws or rules and regulations within after the occurrence.
a. 10 calendar days
b. 15 calendar days
c. 30 calendar days
d. 45 calendar days