AUDITING THEORY

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RA 9298 PHILIPPINE ACCOUNTANCY ACT OF 2004
(Multiple Choice Questions)

1. The
objective
of
the
Philippine
Accountancy Act of 2004 includes:
a. The standardization and regulation of
accounting education.
b. The examination for registration
of certified public accountants.
c. The
supervision,
control,
and
regulation of the practice of
accountancy in the Philippines.
d. All of the above
2. The Philippine Accountancy Act of 2004
shall provide for and govern:
a. The
supervision,
control,
and
regulation of the practice of
accountancy in the Philippines.
b. The standardization and regulation of
accounting education.
c. The examination for registration
of certified public accountants.
d. All of the above
3. The document that contains the norm and
principles governing the practice of the
accountancy profession in the highest
standards of ethical conduct
a. RA 9298
b. Code of Ethics for CPAs in the
Philippines
c. IRR to RA 9298
d. PSA 220 on Quality Control
4. The following statements relate to some of
the provisions of RA 9298. Which is
correct?
a. Audit working papers are generally
the property of the company whose
financial statements were audited.
b. After three (3) years, subject to
certain conditions, the Board of
Accountancy may order the
reinstatement of
a
CPA
whose
certificate
of
registration has been revoked.
c. The penal provision (Sec. 36) of RA
9298 applies only to the violation of
any of the provisions of RA 9298
because its Implementing Rules and
Regulations are unenforceable.
d. It shall be the primary duty of the
PRC and the BOA to effectively
enforce the provisions of RA
9298.
5. Which of the following organization has
been recognized by the Commission on
October 2, 1975 per Accreditation No. 15,
As Accredited Professional Organization?
a. Board of Accountancy (BOA)
b. Association of CPA's in Public Practice
(ACPAPP)
c. Association of CPAs in Education
(ACPAE)
d. Philippine
Institute
of
CPAs
(PICPA)
6. The area of practice of accountancy
namely public accountancy, commerce

and industry, academe / education and

government are called:
a. Sectors
b. Scope of practice of accountancy
c. Section
d. Segment

7. As used in RA 9298, this term refers to the

area of practice of accountancy:
a. Segment
b. Line
c. Sector
d. Section
8. A Certified Public Accountant or CPA is:
a. A person who holds a valid Certificate
of Registration issued by the PRC
b. A
person
who
holds
a
valid
professional Identification Card issued
by the PRC
c. A person who holds a valid
Certificate of Registration and a
valid Professional Identification
Card issued by the PRC
d. A person who is engaged in the
practice of public accountancy
9. A CPA is in public accounting practice
when he/she:
a. Holds, or is appointed to, in an
accounting professional group in
government or in a governmentowned and/or controlled corporation
where
decision
making
requires
professional knowledge in the science
of accounting.
b. Represents his/her clients before
government agencies on tax and
other
matters
related
to
accounting.
c. Represents his/her employer before
government agencies on tax and other
matters related to accounting.
d. Teaches
accounting,
auditing,
management
advisory
services,

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knowledge, science and practice of

accounting and as a qualified person to
render professional services as a CPA
to more than one client.

b. A person is appointed as a
marketing director of a
government
owned
and
controlled corporation.
c. A person in educational institution
teaching accounting, auditing,
business law, taxation or other
technically related subjects.
d. A person representing his/her
employer before government
agencies on tax and other
accounting related matters.
12. Which of the following statements
concerning the practice of accountancy in
the academe/education is incorrect?
a. Members of the Integrated
Bar of the Philippines are not
allowed to teach business
law and taxation subjects.
b. The position of either the Dean or the
Department Chairman or its
equivalent that supervises the
Bachelor of Science in Accountancy
program of an educational institution
is deemed to be in practice of accountancy in the academe/education.
c. CPAs are allowed to teach business
law subjects.

accounting aspect of finance, business

law, taxation, and other technically
related subjects.
10. Which of the following statements
concerning the practice of accountancy in
commerce and industry is incorrect?
a. A CPA is in the practice of
accountancy in commerce and
industry when he/she is involved in
decision making requiring
professional knowledge in the science
of accounting, as well as the
accounting aspects of finance and
taxation.
b. A CPA is in the practice of
accountancy in commerce and
industry when he/she renders
professional services as a
Certified Public Accountant to
more than one client on a fee
basis.
c. A CPA is in the practice of
accountancy in commerce
and
industry
when
he/she
represents his/her employer before
government agencies on tax and
other
matters
related
to
accounting.
d. A CPA is in the practice of
accountancy in commerce and
industry when such employment or
position requires that the holder
thereof must be a Certified Public
Accountant.
11. Which of the following does not constitute
a practice of accountancy?
a. A person holding out himself as one
skilled in the
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d. The position of either the Dean or the
Department Chairman or its
equivalent that supervises the
Bachelor of Science in Accountancy
program of an educational institution
must be occupied only by a duly registered CPA.
13. Which of the following statements
concerning the practice of accountancy is
correct?
a. A CPA is in the practice of
accountancy in the government when
he/she is involved in the audit or
verification of financial transactions
and accounting records of his/her
clients.
b. A CPA is in public accountancy
when he/she renders his/her
professional services as a CPA to
more than one client on a fee
basis in the design, installation,
review, and revision of accounting
systems and controls.
c. A CPA is in the practice of
accountancy in the
academe/education when he/she is
in an educational institution
teaching any of the subjects
included in the BSA curriculum.
d. A CPA is in the practice of
accountancy in commerce and
industry when his/her position

requires civil service eligibility as a

Certified Public Accountant.
14. Which is not permitted by RA 9298 to
practice public accountancy?
a. A CPA in individual capacity.
b. A sole proprietorship.
c. A general partnership.
d. A
corporation,
whose
stockholders are all CPAs.
15. Which is permitted by RA 9298 to practice
public accountancy?
a. A corporation whose stockholders are
all CPAs
b. A corporation whose some of
stockholders are CPAs
c. Limited liability partnership
d. A non-stock corporation whose
members are all CPAs

16. The names under which a CPA practices

the profession must:
a. Indicate any specialization.
b. Contain more than three name.
c. Include one fictitious name.
d. Not misleading as to form of
organization.
17. A certificate of accreditation shall be
issued to CPA's in public practice only
upon showing, in accordance with rules
and regulations promulgated by the BOA
and approved by the PRC, that such
registration has acquired a:
a. Minimum of 3 years meaningful
experience in any of the areas of
practice of accountancy including
taxation.
b. Minimum of 3 years meaningful
experience in any of the areas of
practice of accountancy.
c. Minimum of 3 years meaningful
experience in any of the areas of
public practice including taxation.
d. Minimum of 3 years meaningful
experience in any of the areas of
public practice excluding taxation.
18. The minimum meaningful experience in
public accountancy as required by RA
9298 shall include:
a. At least one year as audit assistant
and at least one year as auditor in
charge.
b. At least one year as audit
assistant and at least two years
as auditor in charge.
c. At least two years as audit assistant
and at least two years as auditor in
charge.
d. At least two years as audit assistant
and at least one year as auditor in
charge.
19. 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 if the business or
company
where the above position exists has
a. An annual revenue of at least
P5,000,000.00
b. A total asset of at least P10,000,000
c. A paid-up capital of at least
P10,000,000.00
d. A paid-up capital of at least
P5,000,000.00
20. Individual CPAs, Firms or Partnerships of
CPAs, including partners and staf
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, 2005, the
registration will expire on
a. Sept. 30, 2007
b. Dec. 31, 2007
c. Dec. 31, 2008
d. Aug. 30, 2007

21. CPAs, firms and partnerships of CPAs

engaged in the practice of public
accountancy including partners and staf
members thereof, shall register with the
PRC and the BOA, such registration to be
renewed every
a. Three years on or before December 31

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partner(s) continue to practice under the

partnership name after becoming a sole
practitioner?
a. 1 year
b. 2 years
c. 3 years
d. Indefinite period of time
23. Which of the following is not one of the
qualifications of the members of the Board
of Accountancy?
a. He/She must not be a director or
officer of PICPA at the time of his
appointment.
b. He/She must be a natural-born
citizen and a resident of the
Philippines.
c. He/She must be a duly
Certified Public Accountant
with at least ten years of
experience in practice of
public accountancy.
d. He/She must not have any direct or
indirect pecuniary interest in any
school, college, university, or
institution ofering a BS
Accountancy course or institution
conducting review classes in
preparation for the licensure
examination at the time of his
appointment to the Board.
24. Which of the following is not one of the
qualifications of the members of the Board
of Accountancy?
a. Must be a natural-born CPA and a
resident of the Philippines.
b. Must be a duly registered Certified
Public Accountant with at least ten
years of experience in practice of
accountancy.
c. Must be of good moral character.
d. Must not have been convicted of
crimes involving moral turpitude.
25. No person shall serve the Professional
Regulatory Board of Accountancy for more
than:
a. 3 years
b. 6 years
c. 9 years
d. 12 years
26. The President of the Philippines, upon the
recommendation of the Commission, may
suspend or remove any member of the
Board of Accountancy. Which of the
following is not a valid ground for
suspension or removal of members of the
Board of Accountancy?
a. Neglect of duty or incompetence
b. A
member
of
the
Board
manipulated the CPA licensure
examination results.

b. Three
years
on
or
before
September 30
c. Two years on or before December 31
d. Two years on or before September 30
22. Based on R.A. 9298, how many years can
a partner who survived the death or
withdrawal of other

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c. A member of the Board has
been sued of crimes involving
moral turpitude.
d. A member of the Board has violated
RA 9298.
27. Which statement is correct regarding the
term of office of the chairman and the
members of the Board of Accountancy
(BOA)?
a. A person may serve in the Board
of Accountancy for eight
consecutive years.

b. No person who has served three (3)

successive complete terms shall be
eligible for reappointment until the
lapse of one (1) year
c. Appointment to fill up an unexpired
term is to be considered a complete
term.
d. No person shall serve in the Board for
more than 10 years.
28. Which of the following is not one of the
functions of

the Board of Accountancy specifically

provided under the RA 9298?
a. To monitor the conditions afecting
the practice of accountancy and
adopt such measures deemed proper
for the enhancement and
maintenance of high professional,
ethical, accounting and auditing
standards.
b. To make investigations as it deems
necessary to determine whether any
person has violated any provisions of
this law or any standards
promulgated by the Board as part of
the rules governing the practice of
accountancy
c. To delegate its power and
function to determine and
prepare test questions for the
CPA licensure examination.
d. To conduct an oversight into the
quality of audits of financial
statements through a review of the
quality control measures.
29. Which is the least function of the Board of
Accountancy?
a. To prepare, adopt, issue or amend
syllabi at the subjects for
examinations in consultation with the
academe.
b. To investigate violations of the RA
9298
c.

To prepare questions for the CPA

licensure examination which shall
strictly within the scope of the syllabi of
the subjects for examination.

d. To supervise PICPA.
30. The following statements relate to the RA
9298. Which statement is true?
a. The Professional Regulation
Commission has the authority to
remove any member of the Board of
Accountancy for negligence,

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b. Incompetence. the lapse of two (2)

years.
c. Violation of the CPAs Code of Ethics.
d. Pending case involving moral
turpitude.40.
The
Board
of
Accountancy shall elect a vicechairman

incompetence, or any other just

cause.
b. No person shall be appointed as a
member
of
the
Board
of
Accountancy unless he has been in
the practice of accountancy for at
least 10 years, among others.

c.

Insanity is not a ground for proceeding

against a CPA.
d. 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.
31. Which of the following is not a function of
the Board of Accountancy?
a. To supervise the registration,
licensure
and
practice
of
accountancy in the Philippines
b. To prescribe and/or adopt a code of
ethics
for
the
practice
of
accountancy
c. To issue, suspend, revoke, or
reinstate the certificate of
registration for the practice of the
accountancy profession
d. To adopt an official
seal
of
the
Commission.
32. The person authorized to remove a
member of BOA on valid grounds and after
due process is:
a. The Commissioner of the PRC.
b. The Chairman of BOA, unless he
is the one under investigation.
c. The President of the Philippines.
d. Congress of the Philippines.
33. The following are the grounds for
suspension or removal of members of
BOA, except
a. Neglect of duty.

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vacant position.

35. Who has the power to suspend or remove any

member of the Board of Accountancy?
a.
The Chairman of the
b.
The Chairman of the
c.
The Chairman of the
d.
The President of th

34. Which of the following statements about the

composition of the Board of Accountancy is
36. This standard setting body shall have a chairman
incorrect?
a. The Board shall be composed of a chairman and who had been or presently a senior accounting
six members. practitioner in any of the scope of accounting
b.
The members ofpractice.
the Board shall be appointed by
a. Philippines from a list of
PICPA
the President of the
b.
ACPAPP
three recommendees for each position and
c.
FRSC
ranked by the Commission from a list of five
d.
AASC
nominees for each position submitted by
Accredited Professional Organization or PICPA.
37. This
standard
setting
body shall have a chairman
c.
The Board shall
elect
a chairman
from
who
had
been
or
presently
among its members to serve for a term ofa senior accounting
practitioner in public accountancy.
one year.
BOA
d.
If the APO fails toa.submit its nominees within 60
b.
AASC
days prior to the expiry of the term of an
c.
FRSC
incumbent chairman or member, the Commission
d.
ACPAE
in consultation with the Board shall submit to the
president a list of three nominees for each

52. Which of the following statements about

Accounting Standard Setting Council is
false?
a. The accounting standard setting
body is to be known as Financial
Reporting Standards Council (FRSC).
b. The Accounting standard setting body
shall be
composed of a chairman and
39. The following statements relate to the term of office
fourteen members.
of
the Chairman andmembers
of the and members of
c. The chairman
Accountancy (BOA). Which is false?
the standard setting council shall
be appointed
byBOA
the shall
Commission
a.
The Chairman and members
of the
upon
the recommendation
of the
hold office for a term
of three
(3) years.
Board
in coordination
with APO.
b.
Any vacancy occurring
within
the term of a
The
practice is
member shall bed.filled
uppublic
for the accounting
unexpired
the
sector
that
is
most
portion of the term only.
represented in the accounting
c.
Appointment to fill up an unexpired term is not
standard setting council.
to be
considered as
a Educational
complete term.
53.
Technical Council (ETC) difers
d.
No person whofrom
has served
two and
successive
accounting
auditing standard
complete terms
as
chairman
or
member
setting councils in that
shall be eligible
reappointment
a. for
The
chairman and until
members
of ETC are appointed by the
Commission.
b. The chairman of ETC must have
AT RA 9298
been or presently a senior
(AASC)
accounting practitioner in
Academe/Education.
49. Which of the following statements about
c. ETC is composed of 15
Accounting Standard Setting Council is
members with a chairman.
false?
d. The chairman and members of ETC
a. The accounting standard setting
have a three year term renewable for
body is to be known as Financial
another term.
Reporting Standards Council (FRSC).
b. The Accounting standard setting body
54. Which of the following is not one of the
shall be composed of a chairman and
functions of
fourteen members.
c. The public accounting practice is
the
sector
that
is
most
represented in the accounting
standard setting council.
d. The chairman and members of the
standard setting council shall be
appointed by the Commission upon
the recommendation of the Board
in coordination with APO.
38. The Chairman and the members of the FRSC and
AASC shall have a term of
a.
1 year
b.
3 years
c.
5 years
d.
6 years

50. The sector that is most represented in the

AASC is the:
a. Commerce and Industry
b. Academe
c. Public Practice
d. Government
51. Which of the following statements is
correct about AASC?
a. The AASC shall be composed of a
chairman and six members.
b. The chairman and members of the
AASC shall be appointed by the
President of the Philippines from a list
of three recommendees ranked by the
Commission from the list of 5
nominees for each position submitted
by APO.
c. The chairman and members of
the AASC shall have a term of
three years renewable for
another term.
d. The AASC shall elect a ViceChairman
from
among
its
members for a term of one year.

ETC?
a. Determine a minimum standard
curriculum
for
the
study
of
accountancy to be implemented in
all schools ofering BS Accountancy.
b. Establish teaching standards,
including the qualifications of the
members of the faculty of schools
and colleges of accountancy.
c. Monitor the progress of the program
on the study of accountancy and
undertaking measures for the
attainment of a high quality
accountancy education in the country.
d. Recommend to the BOA the
revocation of the Certificate of
Registration and the professional
identification card of an
individual CPA or CPA firm
including any of their members
who have not observed the
quality control measures or who
have not complied with the
standards of quality prescribed
for the practice of public
accountancy.
55. Which of the following is not a requisite in
applying
for
the
CPA
licensure
examinations?
a. Good moral character
b. Natural-born
citizen
of
the
Philippines
c. Holder of the degree of Bachelor of
Science in Accountancy
d. Has not been convicted of any criminal
ofense involving moral turpitude
56. An applicant for the CPA licensure
examination
should be
I. A Filipino citizen
II. Of good moral character
III. A holder of the degree of Bachelor of
Science in Accountancy

AT RA 9298

c.

d.

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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 twenty-four
(24) units of subjects given in
the licensure examination.
The examination in which the
candidate was conditioned and the
removal examination oh the subject in
which he/she failed shall be counted
as two (2) complete examinations.
The
refresher
course
should
be
completed within two (2) years from the
preceding examination.

60. Which of the following shall be issued to

examinees who passed the CPA licensure
examination?
a. Certificate of accreditation
b. Personal identification card
c. Certificate of full compliance and PRC
ID.
d. Certificate of registration and
professional identification card

a.
b.
c.
d.

I and II only
I and III only
II and III only
I, II, and III

57. The
following
documents
shall be
submitted by applicants for the CPA
licensure examination, except
a. Certificate of Live Birth in
National Statistics Office (NSO)
security paper.
b. Marriage
contract
in
NSO
security paper for married
male applicants.
c. NBI clearance.
d. Transcript of records with indication
therein of date of graduation and
Special Order number unless it is
not required.
58. A candidate who obtains the rating of
seventy-five percent (75%) and above in
at least a majority of the subjects shall
receive a conditional credit for the
subjects passed. He/she shall take an
examination in the remaining subjects
within
a. One (1) year from the preceding
examination.
b. Two (2) years from the
preceding examination.
c. Three (3) years from the preceding
examination.
d. Five (5) years from the preceding
examination.
59. Which of the following statements is
correct?
a. Any candidate who fails in two (2)
complete CPA board examinations will
no longer be allowed to take another
set of examinations.
b. Any candidate who fails in two (2)
complete CPA board examinations
shall be

Page 5
61. To be qualified as having passed the CPA
licensure examination:
a. The candidate must have a general
weighted average of at least 75%.
b. The candidate must not have a grade
lower than 65% in any given subject.
c. A and B
d. Neither A nor B
62. Any candidate who fails in 2 complete CPA
Board Examinations shall be disqualified
from taking another set of examination
unless he or she submits evidence to the
satisfaction of the Board that
a. He/She
enrolled
in
and
completed at least 24 units of
subjects given in the licensure
examination.
b. He/She enrolled the subjects given in
the CPA Board Examination in the
regular course ofering.
c. He/She is ready to take
another set of examination.
d. He/She enrolled in an educational
institution ofering or conducting
review classes in preparation for
CPA Board Examination.

63. The following statements relate to CPA

examination ratings. Which of the
following is incorrect?
a. To pass the examination, candidates
should obtain a general weighted
average of 75% and above, with no
rating in any subject less than 65%.
b. Conditioned candidates shall take an
examination in the remaining subjects
within two years from the preceding
examination.
c. Candidates who obtain a rating of 75%
and above in at least four subjects
shall receive a conditional credit for
the subjects passed.

he/she shall receive a conditional

credit for the subject passed.
c. A candidate who receives a
conditional credit shall take an
examination on the remaining
subjects within two years from the
preceding examination.
d. A candidate who gets a
conditional credit and takes an
examination on the remaining
subjects must get an average of
at least 75% on the subjects
reexamined and at least 65% in
each of the subjects reexamined.
65. The following are grounds for the
suspension or revocation of certificate of
registration and professional identification
card, except:
a. Unprofessional or unethical conduct.
b. Practice in more than one field of
accountancy.
c. Possession of unsound mind.
d. Conviction of a criminal ofense
involving moral turpitude.
66. The following are grounds for refusal to
issue a certificate of registration and
professional identification card to any
successful examinee except:
a. Guilty of immoral and dishonorable
conduct.
b. Conviction for a political offense.
c. Unsound mind.
d. Conviction of a criminal ofense
involving moral turpitude.
67. A CPA whose certificate has been revoked:
a. Has committed a crime
involving moral turpitude.
b. Is required to take the CPA Board
Licensure examinations before
reinstatement.
c. May be reinstated by the BOA
after the expiration of 2 years
from the date of revocation.
d. Can no longer be reinstated as a CPA.
68. The Board of Accountancy may issue
certificate of registration and professional
identification card to any successful
examinee:
a. Of unsound mind
b. Convicted by a court of political
offense.
c. Guilty of immoral or dishonorable
conduct.
d. Who
has
falsely
represented
himself/herself in his/her application
for examination.

69. The Board of Accountancy may, after the

expiration of ____ years from the date of
revocation of a certificate of registration,
reinstate the validity of a
revoked certificate of
registration. a. 2 b. 3 c. 4
d. 5
d. Candidates who failed in four
CPA licensure examination. Identify the incorrect
complete
statement.
examinations shall no longer be
a. A candidate must have a general weighted
allowed to70. It involves a study or
average of at least 75% with no grades lower
appraisal by the Board or its
than 65% in any given subject in order to pass
take the examinations the fifth time.
the CPA licensure examination.
b. In the event a candidate obtains a rating of 75%
64. The following statements relate to the rating in the
and above in at least a majority of the subjects,

AT RA 9298
of the quality of audit of financial
statements by reviewing the firms quality
control is known as:
a. Quality Review Committee (QRC)
b. Financial Reporting Standards Council
(FRSC)
c. Auditing
and
Assurance
Service
Council (AASC)
d. Educational Training Committee (ETC)
72. Which of the following is one of the
functions of the QRC?
a. To promulgate accounting and
auditing standards that will be
generally accepted in the
Philippines.
b. To evaluate periodically the
performance of educational
institutions ofering accountancy
education.
c. To prescribe and or/ adopt a Code of
Ethics
for
the
practice
of
accountancy.
d. To conduct a review on applicants
for registration to practice public
accountancy and render a report
which shall be attached to the
application for registration.
73. All CPAs who are considered in the
practice of accountancy shall abide by the
requirements, rules and regulations on
continuing professional education. For this
purpose, it is required that all registered
CPAs must complete a number of CPE
units equivalent to
a. 60 credit units in three years
b. 45 credit units in three years
c. 30 credit units in three years
d. 15 credit units in three years
74. For every CPE seminars or conventions
attended, participant CPAs shall get a CPE
credit equivalent to
a. One credit unit per hour.
b. Two credit units per hour.
c. Three credit units per hour.
d. Five credit units per hour.
75. Unless otherwise exempted, registered
CPAs in the practice of accountancy who
have not completed the CPE requirements
shall
a. Be dropped from the roster of CPAs.
b. Not be allowed to renew their
professional licenses.
c. Present evidence to the satisfaction of
the Board that they have the
necessary knowledge, skills and
experience to discharge their
professional responsibility.
d. Submit a letter addressed to the
Board indicating the reasons for not
complying with the CPE requirements.
76. Which of the following statements is
correct about the PRC CPE Council?
a. The Council shall be composed of six
members and a chairperson.
b. The members of the Board shall
choose a
chairperson from
among themselves.
c. The members of the Council shall be
appointed by the Commission upon

recommendation of the Board in

coordination with APO.
d. The chairperson and members of
the Council shall have a term of
three years renewable for another
term.
77. How many CPE credit units must be
accumulated by
a registered
accounting
professional
within the 3-year period?

a.
b.
c.
d.

15 credit units
45 credit units
60 credit units
90 credit units

78. The following statements relate to CPE

credit units. Which is incorrect?
a. The total CPE credit units for
registered accounting professionals
shall be sixty (60) credit units for three
(3) years, provided that a minimum of
fifteen (15) credit units shall be earned
in each year.
b. Any excess credit units in one year
may be carried over to the
succeeding years within the threeyear period.
c. Excess credit units earned may
be carried over to the next
three-year period including
credit units earned for doctoral
and master's degrees.
d.

One credit hour of CPE program,

activity or source shall be equivalent to
one (1) credit unit.

79. The following statements relate to the

exemption from CPE requirements. Which
is false?
a. A registered professional shall
be permanently exempted from
CPE requirements upon reaching
the age of 60 years old.
b. A registered professional shall be
permanently exempted from CPE
requirements upon reaching the age
of 65 years old.
c. A registered professional who is
working or practicing his/her
profession abroad shall be temporarily
exempted from compliance with CPE

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chairperson and two (2) members.

b. The Chairperson shall be
chosen from among the
members of the BOA by the
PRC.
c. The first member shall be the
President or, in his/her absence or
incapacity, any officer chosen by the
Board of Directors of PICPA.
d. The second member shall be the
President or, in his/her absence or
incapacity, any officer of the
organization of Deans or Department
Heads of schools, colleges or
universities ofering the degree
requiring licensure examination.
83. A registered CPA who is working or
practicing his/her profession or furthering
abroad shall be temporarily exempted
from compliance with CPE requirements
during the period of his/her stay abroad,
provided that prior to the date of renewal
he/she has been out of the country for at
least
a. Four years
b. Three years
c. Two years
d. One year

requirements during the period of

his/her stay abroad provided that
he/she has been out of the country for
at least two years immediately prior
to the date of renewal.
d. A registered professional who is
furthering his/her studies abroad shall
be temporarily exempted from
compliance with CPE requirements
during the period of his/her stay
abroad provided that he/she has been
out of the country for at least two
years immediately prior to the date of
renewal.
80. A
registered
professional
shall
be
permanently
exempted
from
CPE
requirements upon reaching the age of
a. 55 years old
b. 65 years old
c. 60 years old
d. 70 years old
81. As defined in Annex "C" of the IRR, this
refers to the inculcation, assimilation and
acquisition
of
knowledge,
skills,
proficiency and ethical and moral values,
after the initial registration of a
professional that raise and enhance the
professional's
technical
skills
and
competence.
a. Professional Development
b. Continuing Professional Education
c. Continuing Professional Development
d. Professional Growth and Development
82. The PRC CPE Council shall assist the BOA
in implementing its CPE program. Which of
the following statements is incorrect
concerning the Council's composition?
a. The PRC CPE Council shall be
composed of a

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84. Rodz, CPA is applying for renewal of his
professional license. He is exempted from
the CPE requirements
a. If he is at least 65 years old
b. If he is working abroad and he has
been out of the country for at least
two years immediately prior to the
date of renewal.
c. Either A or B
d. Under no circumstances
85. Special/temporary permit may be issued
by the Board to the following persons
except:
a. A foreign CPA engaged as a professor
or lecturer in the fields essential to
accountancy education in the
Philippines.
b. A foreign CPA called for consultation
or specific purpose which is essential
for the development of the country
and that there are no Filipino CPAs
qualified for such consultation or
specific purpose.
c. A foreign CPA with specialization in
any branch of accountancy and
his/her service is essential for the
advancement of accountancy in the
Philippines.
d. A foreign CPA who can prove
that the country of which he or
she is a citizen admits citizens

of the Philippines to the

practice of the same
profession without restriction.
86. Which of the following statements
concerning the issuance of Certificates of
Registration and Professional Identification
Cards to successful examinees is correct?
a. The Certificate of Registration
issued to successful examinees is
renewable every three
(3) years.
b. The Professional Identification Card
issued to successful examinees
shall remain in full force and efect
until withdrawn, suspended or
revoked in accordance with RA
9298.
c. The BOA shall not register and
issue a Certificate of Registration
and Professional Identification
Card to any successful examinee
of unsound mind.
d. The BOA may, after the expiration of
three (3) years from the date of
revocation of a Certificate

of Registration, reinstate the

validity of a revoked Certificate
of Registration.
87. Which of the following statements
concerning ownership of working papers is
incorrect?
a. All working papers made by a CPA
and his/her staf in the course of an
examination remain the property of
such CPA in the absence of a written
agreement between the CPA and the
client to the contrary.
b. Working papers include reports
submitted by a CPA to his/her
client.
c. Working papers include schedules
and memoranda prepared and
submitted by the
client of the CPA.
d. Working papers shall be treated
confidential and privileged unless
such documents are required to be
produced through subpoena issued
by any court, tribunal, or
government regulatory or
administrative body.
88. The following statements relate to the use
of seal by registered CPAs. Which is
incorrect?
a. The seal should be of a design
prescribed by the Board bearing the
CPA's name, registration number, and
title.
b. A registered CPA shall obtain and
use a seal of a design that will
suit his/her taste.
c. The auditor's reports shall be
stamped with the CPA's seal,
indicating therein his/her current
Professional Tax Receipt (PTR)
number, date/place of payment
when filed with government
authorities or when used
professionally.
d. The seal of a CPA shall be circular in
form.
89. A special/temporary permit may be issued
by the Board of Accountancy (BOA) to the
following persons, except
a. A foreign CPA engaged as professor,
lecturer or critic in fields essential to
accountancy education in the
Philippines and his/her engagement is
confined to teaching only.
b. A foreign CPA called for
consultation or for a specific
purpose which, in the judgment
of the BOA, is essential for the
development of the country
regardless of whether there are
Filipino CPAs who are qualified
for such consultation or specific
purposes.
c. A foreign CPA who is an
internationally recognized expert or
with specialization in any branch of
accountancy and his/her service is
essential for the advancement of
accountancy in the Philippines.
d. A foreign CPA called for consultation
or for a specific purpose which, in
the judgment of the BOA, is
essential for the development of the

country and that there is no Filipino

CPA qualified for such consultation
or specific purposes.
90. Section 34 of the IRR provides that a
foreign CPA shall not be allowed to
practice accountancy in the Philippines

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concerning foreign reciprocity is incorrect?

a. A foreign CPA should submit an
authentic or authenticated copy of
the law on reciprocity of his/her
country/state officially translated in
the English language.
b. If the letter/document and the copy
of the law submitted by a foreign
CPA are satisfactory to the BOA,
he/she shall be allowed to practice
accountancy in the Philippines but
has to apply for accreditation to do
so.
c. A foreign CPA who desires to
practice accountancy in the
Philippines shall present/submit a
letter or any document signed and
under official seal by the appropriate official of his/her
country/state requesting the
Chairman of the PRC to allow
him/her to practice accountancy in
the Philippines.
d. By express provision of the law of a
foreign CPA's country/state, Filipino
CPAs are allowed to practice
accountancy in his/her country/state
on terms of strict and absolute
equality with the citizens or subjects
of said country or state.
91. The following documents are to be
submitted by a foreign applicant whose
letter/document and the copy of the law
on
foreign
reciprocity
of
his/her
country/state are satisfactory to the BOA,
except
a. The original or certified copy of any
official documents issued by the
Bureau of Immigration and
Deportation allowing the applicant to
enter and reside in the Philip
pines.
b. Certificate of Registration or its
equivalent stating that the foreign
applicant is duly registered or
licensed CPA or its equivalent in
his/her country/state.
c. Certificate of Religious Affiliation.
d. Original or authenticated copy of
transcript of records or equivalent
document of the course for licensure
examination where he/she studied
duly authorized or accredited by
his/her country/state.
92. Any person who shall violate any of the
provisions of the Philippines Accountancy
Act or any of its IRR promulgated by the
Board of Accountancy subject to the
approval of the PRC, shall upon conviction,
be punished by
a. Lethal injection
b. A fine of not more than P50,000
c. Imprisonment for a period not
exceeding two years

unless he/she can prove, in the manner

provided by the rules of court that, by
specific provision of law, the country of
which he/she is a citizen, subject or
national admits Filipino citizens to the
practice of the same profession without
restriction. Which of the following
statements

Page 8
d. A fine of not less than P50,000
or by imprisonment for a period
not exceeding two years or both
93. The following statements relate to roster
of CPAs. Identify the incorrect statement.
a. A roster showing the names and place
of business of all registered CPAs shall
be prepared and updated by the
Board.
b. Copies of the roster shall be made
available to any party as may be
deemed necessary.
c. The Board, upon approval of the
Commission, may delegate the
preparation of this roster to the
APO.
d. The publication of the roster in the
official gazette or in any major
news paper of public circulation
shall be deemed

compliance with the

requirement of RA 9298.
94. The PICPA shall renew its certificate of
accreditation once every:
a. Two years
b. Three years
c. four years
d. five years
95. Affixing the CPA's seal and signature on
the auditor's report is an indication of:
a. CPA's
acceptance
of
responsibility for the financial
statements audited.
b. Compliance by the CPA of the
requisite
accounting
and
auditing standards and rules.
c. CPA's
accreditation
to
practice
public
accountancy.
d. Fair
presentation
of
financial
statements audited.
96. The following statements relate to the
submission of nominations to the Board of
Accountancy. Which is correct?
a. The Accredited National Professional
Organization of CPAs (APO) shall
submit its nominations to the
President of the Philippines not later
than sixty (60) days prior to the
expiry of the term of an incumbent
chair
man or member.
b. The APO shall submit its nominations
to the PRC not later than thirty (30)
days prior to the expiry of the term of
an incumbent chairman or member.
c. If the APO fails to submit its own
nominee(s) to the PRC within the
required period, the PRC in

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The board may after the expiration

of 2 years from the date of
revocation of Certificate of
registration may reinstate the
revoked certificate.
d. All graduates with bachelors degree
major in Accounting shall be allowed
to take the CPA Licensure examination
within two years from the efectivity
of RA 9298 or until May 2006.

consultation with the Board of

Accountancy shall submit to the
President of the Philippines a list of
five (5) nominees for each position.
d. There should be adequate
documentation to show the
qualifications and primary field of
professional activity each
nominee.
97. Which of the following statements about
working paper is correct?
a. Working papers prepared by a
CPA including those prepared and
submitted by the client are the
personal property of the auditor
and the client has no right to
these working papers.
b. Working papers may substitute
the client's accounting records.
c. Working papers should not serve as a
reference source for the clients
accounting records.
d. Working papers are subject to
confidentiality rules and they cannot
be shown to third parties in any
circumstances.
98. The following statements relate to RA
9298. Identify the incorrect statement.
a. Implementing rules and regulations
shall take efect 15 days following
its publication in the official gazette
or in any daily newspapers of
general circulation.
b. Any person who shall violate any
of the provisions of RA No. 9298
or the IRR shall upon conviction,
be punished by a fine of not more
than P50,000.00 or by
imprisonment for a period not
exceeding 2 years or both.

Page 9
d. Independent Quality Control Review
104.
The operation of the Quality Assurance
Review Department (QARD) of the PICPA
shall be supervised by a/an
a. Oversight Committee
b. Executive Committee
c. Supervisory Board
d. Accountability Board

105.
The Head of the QARD who will be
99. The following statements relate to RA
appointed by the Executive Committee is
9298. Which statement is true?
the
a. The
Professional
Regulation
a. Chief Inspector
Commission has the authority to
b. Chief of Administration
remove any member of the Board of
c. Chief Auditor
Accountancy
for
negligence,
d. Chief Quality Assurance Reviewer
incompetence, or any other just cause.
b. Insanity is not a ground for proceeding
against a CPA.
c. A person shall be considered to be in the106.Which of the following is an incorrect
100.
Section 36 (Penal Provision) of RA
professional
practice
of
accounting if, as an officer in a
9298 states
private enterprise, he makes
that any
decisions requiring professional
provisions
accounting knowledge.
of its implementing rules and regulations
d. After three years, subject to certain
shall, upon conviction, be punished by
conditions, the Board of Accountancy
a. A fine of not less than P50,000.
may order the reinstatement of a CPA
b. Imprisonment for a period not
whose certificate of registration has
exceeding two (2) years.
been revoked.

c.

A fine of not less than P50,000 or by

imprisonment for a period not
exceeding two (2) years.
d. A fine of not less than P50,000
or by imprisonment for a period
not exceeding two (2) years, or
both.
101.
The death or disability of an individual
CPA and/or the dissolution and liquidation
of a firm or partnership of CPAs shall be
reported to the BOA not later than days
from the date of such death, dissolution or
liquidation.
a. 15
b. 30
c. 60
d. 90
102.
Which of the following has the power
to conduct an oversight into the quality of
audits of financial statements through the
review of the quality control measures
instituted by auditors?
a. Bureau of Internal Revenue
b. Securities and Exchange Commission
c. Board of Accountancy
d. Insurance Commission
103.
In the exercise of its power to conduct
an oversight into the quality of audits, the
BOA organized the Department of the
Philippine Institute
of Certified Public Accountants (PICPA) to
conduct an independent study, appraisal,
or review of the quality of audit of
financial statements.
a. Quality Control Review
b. Quality Assurance Review
c. Independent Quality Assurance Review

qualification of the Chief Inspector of the

QARD?
a. Must have at least 5 years
experience in the practice of
public accountancy.
b. Must be of good moral character.
c. Must not have been found guilty of
violating any professional, ethical and
regulatory auditing standards.
d. Must have reached the level of senior
manager or partner of an accounting
firm that has among its clients,
publicly listed entities.
107.
Who is responsible for the nontechnical aspect of the QAR program?
a. Chief Inspector
b. Chief of Administration
c. Assistant to the Chief Inspector
d. Chairman of the Executive Committee
108.
a.
b.
c.
d.

The QAR program covers all CPAs in

Public Accounting
Government
Education/Academe
Commerce and Industry

109.
What is the required minimum number
of CPE credit units that an accounting
teacher shall earn in each year prior to
renewal of accreditation?
a. 15 units
b. 20 units
c. 10 units
d. No minimum number of credit units
required
110.
The Certificate of Accreditation issued
by the PRC to an accounting teacher shall
a. Be valid for 2 years and
renewable every 2 years.
b. Be valid initially for 3 years and
renewable annually.
c. Remain in full force and efect
unless
revoked,
cancelled
or
withdrawn.
d. Be valid
for
3
years
and
renewable every 3 years.

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