BRANCHES OF

ACCOUNTING
Chapter 2
 According to Republic Act 9298 on Accounting Practice in the
Philippines;
Republic Act No. 9298 – “An Act regulating the practice of Accountancy in the
Philippines, repealing for the purpose Presidential Decree No. 692, otherwise known
as The revised Accountancy Law, appropriating funds therefore and for other
purposes”.
 
 
Art 1. Sec. 3. Objectives

The standardization and regulation of accounting education;

The examination for registration of certified public accountants; and
The supervision, control and regulation of the practice of accountancy in the Philippines.
Sec. 4. Scope of Practice

a. Practice of Public Accountancy

shall constitute in a person, be it his/her individual
capacity, or as a partner or as 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;
b. Practice in Commerce and Industry – shall
constitute in a person involved in decision making
requiring professional knowledge in the science of
accounting, or when such employment or position
requires that the holder thereof must be a certified public
accountant.
c. Practice in Education/Academe – 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: Provided, that members of
the Integrated Bar of the Philippines may be allowed to
teach business law and taxation subjects.
D. Practice in the Government – shall constitute in a
person who holds, or is appointed to, a position in an
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.
 The Accounting Profession
The success of the accountant in the accounting
profession depends on how well he or she
understands the accounting procedures and
principles, and on how clearly the accurately he
or she can communicate financial information to
the users of the statements.
 
Classification in the Field of Accounting
 
 1. Public accountants – are those who serve the
general public and collect professional fees for their work
such as what Doctors and Lawyers do. Their work
includes auditing, income tax planning and preparation
and management consulting. Those public accountants
who have certain professional requirements are
designated as CPAs.
 2. Private accountants - work for a single business.,
e.g. PLDT, Meralco, Jollibee among others. Charitable
organizations, educational institutions, and government
employed public accountants.
 
 
1
CERTIFIED PUBLIC ACCOUNTANT
 

IS A PROFESSIONAL ACCOUNTANT WHO

EARNS HIS TITLE THROUGH A
COMBINATION OF EDUCATION,
QUALIFYING EXPERIENCE, AND AN
ACCEPTANCE SCORE IN THE WRITTEN
NATIONAL EXAMINATION GIVEN BY THE
BOARD OF ACCOUNTANCY
CPAs in Specialized Areas
1. Forensic Accounting - provide the detective work needed to
investigate and examine evidence of white-collar financial crimes such
as stealing and fraud. They often act as expert witnesses in legal
proceedings and prepare evidence to be presented in court.

2. Information Technology Services - businesses often seek individuals

who can design and implement customized software systems. CPAs
who possess strong skills in information technology can work with e-
commerce ventures and consult with others to determine which
decisions are the most financially and technologically sound for a
company.
3. Environmental Accounting. CPAs involved in
environmental accounting to determined how companies
can be both profitable and environmentally responsible.
They do environmental compliance audits and set up
preventative systems to ensure compliance and avoid
future environmental related claims or disputes.

4. International Accounting. Are knowledgeable in

international trade rules and regulations, international
mergers, governmental regulations, tax laws, and
overseas transactions. CPAs who work in this area often
travel abroad and can speak and understand different
languages.
 
 BRANCHES OF
ACCOUNTING
GOVERNMENT
ACCOUNTING

PUBLIC ACCOUNTING PRIVATE

ACCOUNTING ACCOUNTING

ACCOUNTING
EDUCATION
1. Public Accounting
the accountant performs or offers to perform any
activity that will result to the issuance of an attest
report that is in accordance with professional
standards such as consulting services, preparation of
tax returns, advice on tax matters for free and
personal financial planning services. Some of the
public accounting firms are SyCip Gorres Velayo &
Co, Isla Lipana & Co., Punongbayan & Araullo,
R.G. Manabat & Co. among others.
Examples of public accounting services
1. External Auditing - In external auditing, public accounts
examine the financial statements in order to express an opinion
on whether statements have been fairly presented or not.
2. Tax Preparation and Planning Services - offer tax services
wherein they advise and help their clients in tax planning and
preparing tax returns.
3. Management Advisory Services – Management consulting
is an area in public accounting that involves financial planning
and control, and the development of accounting and computer
systems.
 
 2. PRIVATE ACCOUNTING

Private accounting involves setting up systems of recording

business transactions that are aggregated into financial
statements. It includes the development and interpretation of
accounting information intended to assist management in
operating the business.
A private accountant is a salaries employee who deals with
the company’s day-to-day accounting needs. He/She is trained in
the processing of accounting transactions such as billings and
account payables. His or her knowledge may be limited to the
areas of accounting for which they are responsible.
 Branches of accounting under
private accounting
 Financial accounting – provides economic and financial
information for investors, credits and other external users. It uses
a system of reporting designed to meet the information needed. It
government by an established body, (GAAP) of standards and
principles. It ends in the preparation and presentation of financial
statements.
Cost accounting - focuses on accumulating manufacturing costs
for financial reporting and decision-making purposes. It covers the
reporting of financial information relevant to manufacturing
operations. The primarily role of a cost accountant is to determine
the inventory cost for financial reporting purposes.
● Budgeting - provides a detailed collection and reporting of
expenditures and revenues involved in a business or company
operations. It tracks the financial details of the firm, including the
money taken in and the money spent by the company and the staff.
● Accounting Information System - collects and processes
transaction data. It also disseminates information to interested
parties. It involves the designing of both manual and computerized
data processing system
● Tax Accounting - it deals with the preparation of various
tax returns and doing tax planning for the business. This
is similar to the tax services done in public accounting.
● Internal Accounting - it reviews business operation to
check if they are complying to management policies. It
also evaluates the efficiency of business operations.
Normally, an internal auditor is a hired employee of a
company.
3. Government Accounting
● Is a system used in government offices to record and report financial transactions. It is
the systematic process of collecting, recording, classifying, summarizing, and
interpreting the financial transactions relating to the revenues and expenditures of
government offices.
● Government accounting reveals how public funds have been generated and utilized. It
is employed in both national and local governments.
● CPAs are needed in all levels of government. He or she could be a provincial
accountant, a Commission on audit (COA) auditor to various government agencies, a
BIR examiner to local and national businesses, a budget officer of the DBM, or a bank
examiner of BSP.
 
Accounting Education
● Is responsible for training future accountants. It engages in teaching
accounting, financial management, taxation and other related business
course.

● As per Commission on Higher Education (CHED) Memorandum Order

(CMO) No. 3 Series 2007, a CPA in accounting education should
possess the educational qualifications, professional experience,
classroom teaching ability, computer literacy, scholarly research
productivity, and other attributes that are essential for the successful
conduct of a professional accounting program.
Accounting RESEARCH

involves conducting a careful and diligent study aimed at discovering and intrepreting facts,
revising accepted theories in the light new facts, or the practical application of such new or
revised theories for the generation of a new knowledge. It includes collection information
about a particular subject in order to decide and implement new standards in accounting,
presenting current events that might affect the profession, or discovering new theories that
will have an impact on existing accounting knowledge.
Modern Accounting
● Today’s accounting follows the general rule made by Pacioli. Financial reports and statements were
prepared according to these basic principles. The formal accounting profession (Chartered Accountant)
was created in United Kingdom in the 19 th century after the grant of a Royal Charter to recognize the
profession. Different institutes then emerged in Europe from Edinburgh to London and all over the
European continent.

● With the rise of different institutes all over the world, accounting treatments have differed across borders.
This led to the formation of a standard setting board whose authority will be recognized by member
countries in the application of rules of accounting. From the basic principles, specialized standards and
pronouncements were then made to cater specific issues concerning accounting treatments and
applications.

● There are two accounting standard-setting bodies widely known today – one which originated in Europe
and the other one in the US.
THANK YOU!!!