Accountancy Law

REPUBLIC ACT NO. 9298 MAY 13, 2004

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 THEREFOR AND FOR OTHER PURPOSES
This act shall be known as the "Philippine Accountancy
Act of 2004"
Objectives.
1)The standardization and regulation of accounting
education;
2) The examination of registration of certified public
accountants; and
3) The supervision, control, and regulation of the practice of
accountancy in the Philippines.
 Scope of Practice. - The practice of accountancy shall
include, but not limited to, the following:
Practice of Public Accountancy - shall constitute a
person, be it his/her individual capacity, 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; or offering or rendering, or both or more
than one client on a fee basis or otherwise, services as
such as the audit or verification of financial transaction
and accounting records; or the preparation, signing, or
certification for clients of reports of audit, balance sheet, and
other financial, accounting and related schedules, exhibits,
statement of reports which are to be used for publication or for
credit purposes, or to be filed with a court or government agency,
or to be used for any other purposes; or to design, installation,
and revision of accounting system; or the preparation of income
tax returns when related to accounting procedures; or when
he/she represent clients before government agencies on tax and
other matters relating to accounting or render professional
assistance in matters relating to accounting procedures and the
recording and presentation of financial facts or data.
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.
Practice in Education/Academe - shall constitute in a person
in an educational institution which involve teaching of
accounting, auditing, management advisory services, fiancé,
business law, taxation and other technically related subject:
Provided, That members of the Integrated Bar of the
Philippines may be allowed to teach business law and
taxation subjects.
Practice in Government - shall constitute in a person who
holds, or is appointed to, a position in an accounting
professional group in government or in an 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.
PROFESSIONAL REGULATORY
BOARD OF ACCOUNTANCY
 its Composition
 shall be composed of a Chairman and six 6) members (to be
appointed by the President of the Philippines from a list of
three (3) recommendees for each position and ranked by the
Commission from a list of five (5) nominees for each position
submitted by the accredited national professional
organization of certified public accountant. The Board shall
elect a vice-chairman from among each members for a term
of one (1) year. 
 Qualifications of a members of the
Professional Regulatory Board.
Must be a natural-born citizen and a resident of the Philippines;
Must be a duly registered Certified Public Accountant with at
least ten (10) years of work experience in any scope of practice of
accountancy;
Must be a good moral character and must not have been
convicted of crimes involving moral turpitude; and
Must not have any pecuniary interest, directly or
indirectly, in any school, college, university or
institution conferring an academic degree necessary
for admission to the practice of accountancy or where
review classes in preparation for the licensure
examination are being offered or conducted, nor shall
he/she be a member of the faculty or administration
thereof at a time of his/her appointment to the Board.
Term of Office.
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. No person who has served two (2)
successive complete terms shall be eligible for
reappointment until the lapse of one (1) year. Appointment
to fill up an expired term is not to be considered as a
complete term.
Powers and Functions of the Board. 
To prescribed and adopt the rules and regulations necessary
for carrying out the provisions of this Act;
To supervise the registration, licensure and practice of
accountancy in the Philippines;
To administer oaths in connection with the administration of
this Act;
To issue, suspend, revoke, reinstate the Certificate of
Registration for the practice of the accountancy
profession;
To adopt an official seal of the Board;
To prescribe and/or adopt a Code of Ethics for the
practice of accountancy;
To monitor the conditions affecting the practice of accountancy
and adopt such measures, including promulgation of accounting
and auditing standards, rules and regulations and best practices
as may be deemed proper for the enhancement and maintenance
of high professional, ethical, accounting and auditing standards:
That domestic accounting and auditing standards rules and
regulations shall include the international accounting and
auditing standards, and generally accepted best practices;
To conduct an oversight into the quality of audits of financial
statements though a review of the quality control measures
instituted by auditors in order to ensure compliance with the
accounting and auditing standards and practices,
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 Board
upon approval 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 Board and/or the
Commission may adopt their findings of fact as may be seems fit.
The Board may, muto propio in its discretion, may
such investigations as it deem necessary to
determine whether any person has violated any
provisions of this law, any accounting or auditing
standard or rules duly promulgated by the Board as
part of the rules governing the practice of
accountancy;
To issue a cease or desist order to any person, associations,
partnership or corporation engaged in violation of any provision of
this Act, any accounting or auditing standards or rules of duly
promulgated by the Board as part of the rules governing the practice
of accountancy in the Philippines;
To punish for contempt of the Board, both direct and indirect, in
accordance with the pertinent provision of and penalties prescribed
by the Rules of Court;
To prepare, adopt, issue or amend the syllabi of the subjects for
examinations in consultation with the academe, determine and
prepare questions for the licensure examination which shall strictly
be within the scope of the syllabi of the subjects for examinations as
well as administer, correct and release the result of the licensure
examinations;
To ensure the coordination with the Commission of the Higher
Education (CHED) or other authorized government offices that all
higher educational instruction and offering of accountancy comply
with the policies, standards and requirements of the course
prescribed by the CHED or other authorized government offices in
the areas of curriculum, faculty, library and facilities; and
To exercise such other powers as may be provided by law as well as
those which may be implied from, or which are necessary or
incidental to the carrying out of, the express powers granted to the
Board to achieve the objectives and purposes of this Act.
Grounds for Supervision or Removal of
Members of the Board. 
Neglect of Duty or incompetence;
Violation or tolerance of any violation of this Act and it's
implementation rules and regulations or the Certified Public
Accountant's Code of Ethics and the technical and professional
standards of practice for certified public accountant;
Final judgment of crimes involving moral turpitude; and
Manipulation or rigging of the certified public accountant's licensure
examination results, disclosure of secret and confidential information
in the examination questions prior to the conduct of the said
examination or tampering of grades.
EXAMINATION, REGISTRATION
AND LICENSURE
Qualifications of Applicant for Examinations. - Any person applying for
examination shall establish the following requisites to the satisfaction of the
Board that he/she:
is a Filipino citizen;
is of good moral character;
is a holder of the degree of Bachelor of Science in Accountancy conferred by the
school, college, academy or institute duly recognized and/or accredited by the
CHED or other authorized government offices; and
has not been convicted of any criminal offence involving moral turpitude.
Scope of Examination.
The licensure examination for certified public accountants shall cover, but are not limited to, the
following subjects:
Theory of Accounts
Business Law and Taxation
Management Services
Auditing Theory
Auditing Problems
Practical Accounting Problem I
Practical Accounting Problem II
Rating in the Licensure Examination.
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 grade lower than sixty-five percent
(65%) in any given subject. 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
conditional credit for the subjects passed: Provided, That a
candidate shall take an examination in the remaining subjects within
two (2) years from preceding examination: Provided, further, That if
the candidate fails to obtain at least a general average of seventy-five
percent (75%) and a rating of at least sixty-five percent (65%) in each
of the subjects reexamined, he/she shall be considered as failed in
the entire examination.
Report of Rating. –
The Board shall submit to the Commission the rating
obtained by each candidate within ten (10) calendar days
after the examination, unless extended for just cause. Upon
the release of the results of the examination, the
Commission shall send by mailing the rating received by
each examinee at his/her given address using the mailing
envelop submitted during the examination.
Failing Candidates to Take Refresher Course. - 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 submit evidence to the satisfaction of the Board that he/she
enrolled in and completed at least twenty-four (24) units of subject given in the licensure
examination.
 A certificate of registration shall be issued to examinees who pass the licensure examination
subject to payment of fees prescribed by the Commission. The Certificate of Registration shall
bear the signature of the chairperson of the Commission and the chairman and members of the
Board, stamped with the official seal of the Commission and of the Board, indicating that the
person named therein is entitled to the practice of the profession with all the privileges
appurtenant thereto. The said certificate shall remain in full force and effect until withdrawn,
suspended or revoked in accordance with this Act.
A Professional Identification Card bearing the registration number date of issuance, expiry date,
duly signed by the chairperson of the Commission, shall likewise be issued to every registrant
renewable every three (3) years.
Indication of Certificate of Registration, Identification Card and Professional Tax Receipt. - The
certified public Accountant shall be required to indicate his/her certificate of registration
number and date of issuance, the duration of validity, including the Professional Tax Receipt
number on the documents he/she signs, uses or issues in connection with the practice of
his/her profession.
Suspension and Revocation of Certificate of Registration and Professional Identification Card
and Cancellation of Special Permit. - The Board shall have the power, upon the notice and
hearing, to suspend or revoke the practitioner's certificate of registration and professional
identification card or suspend his/her from the practice of his/her profession or cancel his/her
special permit for any of the causes or ground mentioned under Section 23 of this Act or any of
the provisions of this Act, and its implementing rules and regulations, the certified Public
Accountant's Code of Ethics and the technical and professional standards of practice for certified
public accountants.
Reinstatement, Reissuance and Replacement of Revoked or Lost Certificates. - The Board may,
after the expiration of two (2) years from the date of revocation of a certificate of registration
and upon application and for reasons deemed proper and sufficient, reinstate the validity of a
revoked certificate of registration and in so doing, may, in its discretion, exempt the applicant
from taking another examination.
A new certificate of registration to replace lost, destroyed, or mutilated certificate/license may
be issued, subject to the rules and promulgated by the Board and the Commission, upon the
payment of the required fees
Limitation of the Practice of Public Accountancy. - Single practitioners and partnerships for the
practice of public accountancy shall be registered certified public accountants in the Philippines:
Provided, That from the effectivity of this Act, a certificate of accreditation shall be issued to
certified public accountant in public practice only upon showing, in accordance with rules and
regulations promulgated by the Board and approved by the Commission, that such registrant
has acquired a minimum of three (3) years meaningful experience in any of the areas of public
practice including taxation: Provide, further, that this requirement shall not apply to those
already granted a certificate of accreditation prior to the effectivity of this Act. The Security and
Exchange Commission shall not register any corporation organized for the practice of public
accountancy.
Ownership of Working Papers. - All working papers, schedules and memoranda made by a
certified public accountant and his staff in the course of an examination, including those
prepared and submitted by the client, incident to or in the course of an examination, by such
certified public accountant, except reports submitted by a certified public accountant to a client
shall be treated confidential and privileged and remain the property of such certified public
accountant in the absence of a written agreement between the certified public accountant and
the client, to the contrary, unless such documents are required to be produced though
subpoena issued by any court, tribunal, or government regulatory or administrative body.
Accreditation to Practice Public Accountancy. Certified public accountants, firms and
partnerships of certified public accountants, engaged in the practice of public accountancy,
including partners and staff members thereof, shall registered with the Commission and the
Board, such registration to be renewed every three (3) years: Provided, That subject to the
approval of the Commission, the Board shall promulgate rules and regulations for the
implementation of registration requirements including the fees and penalties for violation
thereof.
Continuing Professional Education (CPE) Program. - All certified public accountants shall abide
by the requirements, rules and regulations on continuing professional education to be
promulgated by the Board, subject to the approval of the Commission, in coordination with the
accredited national professional organization of certified public accountants or any duly
accredited educational institutional. For this purpose, a CPE Council is hereby created to
implement the CPE program.
Seal and Use of Seal. All license certified public accountants shall obtain and use a seal of a
design prescribed by the Board bearing the registrant's name, registration number and title. The
auditors reports shall be stamped with the said seal, indicating therein his/her current
Professional Tax Receipt (PTR) number, date/place of payment when filed with government
authorities or when used professionally.
Foreign Reciprocity. - Subject or citizen of foreign countries may be allowed to practice
accountancy in the Philippines in accordance with the provisions of existing laws, international
treaty obligations including mutual recognition agreement entered into by the Philippines
government with other countries. A person who is not a citizen of the Philippines shall not be
allowed to practice accountancy in the Philippines unless he/she can prove, in the manner
provided by the Rules of Court that, specific provision of law country of which he/she is a citizen,
subject or national admits citizens of the Philippines to the practice of the same profession
without restriction.
Coverage of Temporary/Special Permits. - Special/temporary permit may be issued by the
Board subject to the approval of the Commission and payment of the fees the latter has
prescribed and charged thereof to the following persons:
a) A foreign certified public accountant called for consultation or for specific purpose which, in
the judgment of the Board, is essential for the development of the country: Provided, That
his/her practice shall be limited only for the particular work that he/she is being engaged:
Provided, further, That there is no Filipino certified public accountant qualified for such
consultation or specific purposes;
b) A foreign certified public accountant engaged as professor, lecturer or critic in fields essential
to accountancy education in the Philippines and his/her engagement is confined to teaching
only; and
c) A foreign certified public accountant who is an internationally recognized expect or with
specialization in any branch of accountancy and his/her service is essential for the advancement
of accountancy in the Philippines.
Penal Provision. - Any person who shall violate any of the provisions of this Act or any of its
implementing rules and regulations as promulgated by the Board subject to the approval of the
Commission, shall upon conviction, be punished by a fine of not less than Fifty Thousand Pesos
(50,000.00) or by imprisonment for a period not exceeding two (2) years or both.