Far Eastern University Manila

ACCOUNTING 5903

1)S1: A professional accountant in public practice earns either monthly or semi-monthly salary.

S2: A position where a civil service eligibility as a certified public accountant is a prerequisite is considered as a practice of accountancy in the government sector.

 

2. S1: Any position in any business or company in the private sector which requires supervising the recording of financial transactions, preparation of financial statements, coordinating with the external auditors for the audit of such financial statements and other related functions shall be occupied only by a duly registered CPA.

S2: CPAs in the Treasurer’s Office of Far Eastern University, an educational institution in Manila, are considered CPAs in

Education/Academe.

 

3. S1: As far as the Academe sector is concerned, members of the Integrated Bar of the Philippines may be allowed to teach business law and taxation subjects.

S2: CPAs who serve as dean or department heads of the program of accountancy of academic/educational institutions are deemed practicing in the Education/Academe sector.

 

4. S1: The Board of Accountancy (The Board or BOA) shall be composed of a chairman and six (6) members to be appointed by the Professional Regulation Commission.

S2: The APO shall submit its nominations for BOA membership/chairmanship with complete documentation to the Commission not later than (90) days prior to the expiry of the term of an incumbent chairman or member of the Board.

 

5. S1: One of the qualifications for the appointment to the Board is that the candidate must be a Filipino citizen.

S2: The Chairman of PRC, after giving the concerned BOA member an opportunity to defend himself in a proper administrative investigation to be conducted by the Commission, may suspend or remove any member on grounds of neglect of duty or incompetence, violation or tolerance of any violation of this Act, final judgment of crimes involving moral turpitude and rigging of CPA Board Exams.

 

6. S1: The Chairman and members of the Board shall hold office for a term of three (3) years. Any vacancy occurring within the term of a member shall be filled up for the unexpired portion of the term only.

S2: No person shall serve the Board (BOA) for more than twelve (12) years.

 

7. S1: The Chairman of Financial Reporting Standards Council (FRSC) shall be a senior accounting practitioner from any sector of accountancy practice.

S2: Members of accounting and standard setting bodies must all be CPAs.

 

8. S1: Members of existing standard setting bodies may not become part of the new standard setting bodies created by the PRC by virtue of the IRR to RA 929

S2: The chairman of FRSC must be a senior accounting practitioner of accountancy from any sector of accountancy practice.

 

9. S1: Category A auditors may audit financial statements of both public interest entities using full PFRS and entities using PFRS for SMEs.

S2: The Quality Assurance Review (QAR) program of the BOA covers all CPAs in practice.

 

10. S1: In Education Technical Council (ETC), the APO shall distribute the representation of the Academe/Education sector among the private and public schools offering BSA degree.

S2: A certain Mr. Excited, a fresh university graduate, who recently passed the October 2017 CPA Licensure examination may obtain full accreditation for accounting teacher from BOA and teach in a university of his choice immediately.

 

11. S1: To be qualified as having passed the licensure examination for accountants, a candidate must obtain a general average of seventy-five percent (75%), with no grades lower than sixty percent (60%) in any given subject.

S2: Any person applying for examination shall establish the following requisites to the satisfaction of the Board that he/she: (a) is a Filipino citizen; (b) is of good moral character; (c) is a holder of the degree of Bachelor of Science in Accountancy conferred by a school, college, academy or institute duly recognized and/or accredited by the CHED or other authorized government offices; (d) has not been convicted of any criminal offense involving moral turpitude.

 

12. S1: Any candidate who fails in two (2) complete Certified Public Accountant Board Examinations shall be disqualified from taking another set of examinations unless he/she submits evidence to the satisfaction of the Board that he/she enrolled in and completed at least 18 units of subjects given in the licensure examination.

S2: The Board, subject to the approval of the Commission, may revise or exclude any of the subjects and their syllabi, and add new ones as the need arises. Provided, That the change shall not be more often than every five (5) years.

 

13. S1: In the event a candidate obtains the rating of seventy-five percent (75%) and above in at least a majority of subjects as provided for in this Act, he/she shall receive a/an absolute credit for the subjects passed.

S2: For purposes of this Act, the examination in which the candidate was conditioned together with the removal examination on the subject in which he/she failed shall be counted as two (2) separate examination/s.

 

This study source was downloaded by 100000826397460 from CourseHero.com on 05-22-2021 21:45:27 GMT -05:00

14. S1: The subjects covered by the CPA licensure examination include Financial Accounting and Reporting, Advanced Financial Accounting and Reporting, Auditing, Management Advisory Services, Regulatory Framework for Business Transactions and Taxation.

S2: The Board shall submit to the Commission the ratings obtained by each candidate within fifteen (15) calendar days after the examination, unless extended for just cause.

 

15. S1: All successful candidates in the examination shall be required to take an oath of profession before any member of the Board or before any government official authorized by the Commission or any person authorized by law to administer oaths.

S2: The two (2) CPA Credentials a CPA will receive upon passing the CPA Board Exam are Certificate of Registration and Professional Identification Card.

 

16. S1: The CPA shall be required to indicate the numbers of his/her Certificate of Registration, and Professional Identification Card with its date of issuance and the duration of validity, including the Professional Tax Receipt Number which the City/Municipal Treasurer shall issue to the registered CPA on the documents he/she signs, uses or issues in connection with the practice of his/her profession.

S2: Malpractice of the profession is one of the grounds why a successful candidate in the CPA Licensure Exam shall be refused to issue his/her CPA credentials.

 

17. S1: No person shall practice accountancy in this country, or use the title “Certified Public Accountant”, or use the abbreviated title “CPA” or display or use any title, sign, card, advertisement, or other device to indicate such person practices accountancy unless such person shall have received Certificate of Registration from the Board.

S2: All working papers, schedules and memoranda made by a CPA and his staff in the course of an examination, including those prepped and submitted by the client incident to the CPA’s examination, except reports submitted by a CPA to a client shall be treated confidential and privileged and remain the property of such CPA.

 

18. S1: All registered CPAs shall obtain and use as seal of a design such CPA chooses to be stamped in the auditor’s reports to be issued by such CPA.

S2: Generally, a person who is not a citizen of the Philippines shall not be allowed to practice accountancy in the Philippines.

 

19. S1: Any person who shall violate the RA 9298 or its IRR shall be punished by a fine of not less than fifty thousand pesos (P50,000) or by imprisonment for a period not exceeding two (2) years or both.

S2: The Philippine Institute of Certified Public Accountants (PICPA) is the current Accredited National Professional Organization (APO) of accountancy profession in the Philippines.

 

20. S1: Continuing Professional Education (CPE) refers to the inculcation, assimilation an acquisition of knowledge, skills, proficiency and ethical and moral values during the CPAs formal education.

S2: The Board, upon approval of PRC, shall create a Council which shall assist the Board in implementing its CPE program to be known as PICPA CPE Council.

 

21. S1: CPD can only be earned by attending seminars and conventions.  S2: BoA can mete out sentence of imprisonment for erring CPAs.

 

22. S1: A CPA must earn at least 120 units of CPD over three years as a condition precedent to renew his or her professional license.

S2: The Certificate of Registration issued by the Board to the CPA is valid until it is revoked.

 

23. S1: No CPA can practice public practice under his/her own name until he/she secures first a Certificate of Accreditation from the Board.

S2: Affixing the CPA seal by the CPA to his or her reports means that the CPA is compliant with requisite auditing and accounting standards and rules.

 

24. S1: Boyong, male, recently married Maricar right after their graduation from university. Now, in applying for CPA licensure examination, Boyong needs to secure NSO Marriage Certificate to be eligible to take the CPA Board Exam.

S2: Selena has the following results in her recently concluded CPA licensure examination: FAR – 83; AFAR – 72; Auditing – 88; MAS – 74; RFBT – 77; Taxation – 66. Selena passed the CPA Licensure Examination.

 

 

The following statements relate to the accounting profession:

1. I. To merit public trust and confidence, the professional person must convince the public that he will place public service ahead of personal reward.
   2. A CPA certificate is evidence of basic competence in the discipline of accounting at the time the certificate   is granted.
   3. A code of professional conduct is one of the most important distinguishing characteristics of a profession.

 

State whether the foregoing statements are  or .

1. All of the statements are .
2. Only two of the statements are .
3. Only one of the statements is .
4. All of the statements are .

2. Any position in any business or company in the private sector which requires supervising the recording of financial transactions, preparation of financial statements, coordinating with the external auditors for the audit of such financial statements and other related functions shall be occupied only by a duly registered CPA. Provided (choose the incorrect one)

1. That the business or company where the above position exists has a paid-up capital of at least P5,000,000 and/or an annual revenue of at least P10,000,000.
2. The above provision shall apply only to persons to be employed after the effectivity of the Implementing Rules and Regulations of RA 9298.
3. The above provision shall not result to deprivation of the employment of incumbents to the position.
4. None of the above.

 

3. The following statements relate to RA 9298. Which statement is ?

1. The Professional Regulation Commission has the authority to remove any member of the Board of Accountancy for negligence, incompetence, or any other just cause.
2. Insanity is not a ground for proceeding against a CPA.
3. A person shall be considered to be in the professional practice of accounting if, as an officer in a private enterprise, he makes decisions requiring professional accounting knowledge.
4. After three years, subject to certain conditions, the Board of Accountancy may order the reinstatement of a CPA whose certificate of registration has been revoked.

 

4. The president of the Philippines appoints the members of the Board of Accountancy based on the recommendation submitted to the office of the president. Which of the following is an incorrect statement about the submission of nominations?

1. The Accredited National Professional Organization of CPAs shall submit the names of its nominees to the PRC not later than 60 days prior to the expiry of the term of an incumbent chairman or member.
2. There should be an adequate documentation to show the qualifications and primary field of professional activity of each nominee.
3. The Accredited National Professional Organization of CPAs shall submit the names of its nominees to the PRC not later than 45 days prior to the expiry of the term of an incumbent chairman or member.
4. If the Accredited National Professional Organization of CPAs fails to submit its own nominee(s) to the PRC within the prescribed period, the PRC, in consultation with the Board of Accountancy shall submit to the president of the Philippines a list of three nominees for each position.

 

5. The primary duty to enforce the provisions of RA 9298 and its IRR rests with

1. The PRC
2. The BOA
3. The PRC and BOA
4. The AASC

 

6. A member of the BOA shall, at the time of his/her appointment, possess the following qualifications, except

1. Must be a natural-born citizen and resident of the Philippines.
2. Must be a duly registered CPA with more than ten (10) years of work experience in any scope of practice of accountancy.
3. Must be of good moral character and must not have been convicted of crimes involving moral turpitude.
4. Must not be a director or officer of the APO at the time of his/her appointment.

 

7. The following statements relate to the term of office of the chairman and members of the Board of Accountancy. Which of them is incorrect?

1. The chairman and members of the Board of Accountancy shall hold office for a term of three years.
2. Any vacancy occurring within the term of a member shall be filled up for the unexpired portion of the term only.
3. Appointment to fill up an expired term is not to be considered as a complete term.
4. The Board of Accountancy member who has served two successive complete terms as chairman or member shall be eligible for reappointment until the lapse of three years.

 

8. Which of the following is not represented in the Auditing and Assurance Standards Council?

1. Board of Accountancy
2. Commission on Audit
3. Bureau of Internal Revenue
4. Securities and Exchange Commission

 

9. Which of the following is not a function of the Board of Accountancy as specified in the Philippine Accountancy Act of 2004?

1. To investigate violations of the Accountancy Law and the rules and regulations promulgated therewith.
2. To look from time to time into the conditions affecting the practice of the accountancy profession.
3. To create and direct accrediting agencies that are entrusted the functions of reviewing higher educational institutions’

policies and practices leading to accreditation/reaccreditation of BSA program.

4. To determine and prescribe minimum requirements leading to the admission of candidates to the CPA licensure examination.

 

 

10. Individual CPAs, Firms or Partnerships of CPAs, including partners and staff members thereof shall register with the BOA and the PRC. If the application for registration of AB and Co., CPAs was approved on August 30, 2014, the registration will expire on

a.    Sept. 30, 2016

b.    Dec. 31, 2017

c.     Dec. 31, 2016

d.    Aug. 30, 2016

 

11. The Financial Reporting Standards Council which is the accounting standards setting body is composed of a chair and:

1. Fourteen members
2. Fifteen members
3. Sixteen members
4. Seventeen members

 

12. Which of the following mostly describes the function of AASC?

1. To monitor full compliance by auditors to PSAs.
2. To promulgate auditing standards, practices and procedures that shall be generally accepted by the accounting profession in the Philippines.
3. To assist the Board of Accountancy in conducting administrative proceedings on erring CPAs in audit practice.
4. To undertake continuing research on both auditing and financial accounting in order to make them responsive to the needs of the public.

 

13. A study, appraisal, or review by the BOA or its duly authorized representatives, of the quality of audit of financial statements through a review of the quality control measures instituted by an Individual CPA, Firm or Partnership of CPAs engaged in the practice of public accountancy.

1. Peer review
2. Quality assurance review
3. Analytical review
4. Administrative review

 

14. Which of the following is not a requisite in applying for the CPA licensure examinations?

1. Natural-born citizen of the Philippines
2. Good moral character
3. Holder of the degree of Bachelor of Science in Accountancy
4. Has not been convicted of any criminal offense involving moral turpitude

 

15. Which statement is correct regarding AASC?

1. The AASC shall be composed of 15 members plus a Chairman.
2. The chairman and members of the AASC shall be appointed by the President of the Philippines upon the recommendation of PRC.
3. The chairman and members of the AASC shall have a non-renewable term of 3 years.
4. The chairman should have been or presently a senior practitioner in public accountancy.

 

16. Which one of the following is not a logical function of a CPA in public accounting practice?

1. Attest function.
2. Supervision of internal audit staff.
3. Tax practice.
4. Management consulting services.

 

17. Who are required to apply for accreditation with the Professional Regulation Commission if the applicant is a partnership of Professional Accountants?

1. Managing partner only
2. All partners only
3. Partners and staff members
4. Partners, principals, and staff members

 

18. Which of the following is are grounds for suspension or removal of members of BOA?

1. Neglect of duty or incompetence.
2. Violation or tolerance of any violation of the CPA’s Code of Ethics.
3. Final judgment of crimes involving moral turpitude.
4. Rigging of the certified public accountants licensure examination results.

1. I, II, III and IV
2. I, II and III
3. III and IV
4. I, III and IV

 

 

19. The Board, subject to the approval of the Commission, may revise or exclude any of the subjects and their syllabi, and add new ones as the need arises. Provided that the change shall not be more often than every (SEC 15)

1. 2 years
2. 3 years
3. 4 years
4. 5 years

 

20. The following statements relate to CPA examination ratings. Which of the following is incorrect? (SEC 16)

1. To pass the examination, candidates should obtain a general weighted average of 75% and above, with no rating in any subject less than 65%.
2. Candidates who obtain a rating of 75% and above in at least four subjects shall receive a conditional credit for the subjects passed.
3. Candidates who failed in four complete examinations shall no longer be allowed to take the examinations the fifth time.
4. Conditioned candidates shall take an examination in the remaining subjects within two years from the preceding examination.

 

21. A document under seal issued to an individual by the Professional Regulation Commission signifying that he has complied with all the legal and procedural requirements for such issuance including the passing of the licensure examination for Certified Public Accountants.

1. Certificate of Accreditation
2. Professional Identification Card
3. Certificate of Registration
4. Professional Seal

 

22. Which of the following is not included in the seal of a professional accountant?

1. Tax identification number
2. Name of the professional accountant
3. Title of the profession
4. Registration number

 

23. The following is deemed a practice of accountancy, except:

1. Appointment to a position in the government that requires a CPA license as a prerequisite.
2. Employment as budget officer in a local government unit regardless of the officer being a holder of a CPA license or not.
3. Teaching professional subjects in a collegiate program leading to the degree of Bachelor of Science in Accountancy.
4. Representing his clients before government agencies on tax and other matters related to accounting.

 

24. The Accountancy Law provided that a CPA certificate may be suspended or revoked on grounds except

1. Immoral or dishonorable conduct.
2. Gross negligence or incompetence in the practice of profession.
3. Refusal to accept an audit engagement with a government corporation.
4. Conduct discreditable to the accounting profession.

 

25. Indicate whether the following functions would be performed by: P – Partner S – Senior

M – Manager AS – Audit Assistant

1. Supervises two or more concurrent audit engagements
2. Performs detailed audit procedures
3. Overall responsibility for audit
4. Signs audit report

(1)	(2)	(3)	(4)
a.    P	AS	S	M
b.    M	S	M	P
c.     M	AS	P	P
d.    P	AS	S	M

 

26. Pursuant to the AICPA rules of conduct, if a partner in a two member partnership dies, the surviving partner may continue to practice as an individual under the existing firm title which includes the deceased partner’s name

1. For a period of time not to exceed five years.
2. For a period of time not to exceed two years.
3. Indefinitely.
4. Until the partnership payout to the deceased partner’s estate is terminate

 

 

 

27. The amount of audit fees depend largely on the

1. Size and capitalization of the company under audit.
2. Amount of profit for the year.
3. Availability of cash.
4. Volume of audit work and degree of competence and responsibilities involve

 

28. What are the changes made by the Board to the existing subjects of the CPA Licensure examination pursuant to BOA Resolution no. 262 Series of 2015 (choose the exception)?

1. Reducing the CPA Licensure examination subjects from seven (7) to six (6).
2. Merging “Auditing Theory” and “Auditing Problems” in one subject, “Auditing”.
3. Splitting “Business Law and Taxation” into two separate subjects, “Taxation” and “Regulatory Framework for Business Transaction”.
4. Removal of the subject “Management Advisory Services”.

 

29. Under this method of billing a client, the external auditors charges on the basis of time spent by principals/partners, supervisors, seniors and juniors at predetermined rates agreed upon with the client

1. Maximum fee basis
2. Flat sum basis
3. Retainer basis
4. Per diem basis

 

30. The certified public accountant shall be required to indicate which of the following numbers on the documents he/she signs, uses or issues in connection with the practice of his/her profession? (SEC 22)

		a	b	c	d
His/her Certificate of Registration Professional Identification Card	Yes Yes		Yes Yes	Yes Yes	No Yes
Professional Tax Receipt	Yes		Yes	No	Yes
Telephone	Yes		No	No	No

 

31. Which of the following is not one of the grounds for proceedings against a CPA?

1. Gross negligence or incompetence in the practice of his profession.
2. Engaging in public practice while being employed in a private enterprise.
3. Insanity.
4. Immoral or dishonorable conduct.

 

32. In accordance with BOA Resolution No. 126 Series of 2008, Adoption of the Rules and Regulations on Advertising for the Philippine Accountancy Profession, generally, advertising and publicity in any medium are acceptable provided:

1. It has as its objective the notification to the public or such sectors of the public as concerned, of matters of fact in a manner that is not , misleading or deceptive.
2. It is in good taste.
3. It is professionally dignified and avoid repetition of, and any undue prominence being given to the name of the firm or professional accountant in public practice.
4. All of the above.

 

33. A person whose CPA certificate has been revoked

1. Can no longer be reinstated as a CPA
2. Is automatically reinstated as a CPA after two years if the has acted in an exemplary manner
3. May be reinstated as a CPA by the Board of Accountancy after two years if he has acted in an exemplary manner
4. May be reinstated by the PRC after two years if he has acted in an exemplary manner

 

34. Below are the names of three CPA firms and pertinent facts relative to each firm. Unless otherwise indicated, the individuals named are CPAs and partners, and there are no other partners. Which firm name and related facts indicates a violation of the IRR of RA 9298?

1. Jonna, Patricia and Paula, CPAs (Jonna died about 10 years ago, Patricia and Paula are continuing the firm)
2. Fred and Maggie, CPAs ( the name of Luke a third active partner is omitted in the firm name)
3. Victor and Victorina, CPAs (Victor died 25 months ago, Victorina is continuing the firm as a sole proprietor)
4. Art and Angel, CPAs (Angel died 3 years ago, Aboy was admitted into the partnership 2 months after Angel’s death.)

 

35. In relation to revised Rules on Advertising adopted by BOA, which of the following statements is :

1. The use of the name of an international accounting firm affiliation/correspondence other than a notation that it is a “member/correspondent firm of that foreign firm” shall not be allowed so as to imply that the foreign firm is practicing in the Philippines.
2. No firm or CPA practitioner shall identify the name of a client or items of a client’s business in advertising, public relations

or marketing material produced to promote his practice provided that the client gives its written consent.

3. No firm or CPA practitioner shall use the term “Accredited” or any similar words or phrases calculated to convey the same meaning if the claimed accreditation (BOA, SEC, BSP or IC) has expired.
4. All advertisements must have prior review and approval in writing by the Board of Accountancy.