Brcncnn, bec marr AUDITING (Quiz 001-Phil Accountancy Aet 1. The objectives ofthe Philippine Accountancy Act of 2004 are the following except fandardization and regulation of accounting education. Examination for registration of CPAS. Supervision, control and regulation ofthe practice of accountancy, Integration of accountancy pratession. The Philippine Accountaney Act of 2004 i also known 35 Reputlie Act Philippine Accountancy Act of 2008 was approve by then President 2. Joseph € Estrada (® Gloria Macapagal Aroyo © FidetV. Rams 4. Corazon Aquino ‘ThePhilppine Accountancy Act of 2008 was finaly approved on —_e C08 February 6 2008 4. February 7, 2008 “he practice of accountancy, 35 provided bythe Phipine Accountancy Act of 2004, includes Public aceeuntancy b. Commerce and industry Eduction @ Alofthe above 6. Which ofthe folowing statements not true as to the qualifications of the members ofthe AccountacyPrfessonal Regulatory Board ‘ant. AFlipinoetizen Must beaduly registered Certified Pubic Accountant with at east ten (10) years of work experience in any scope af practice of accountancy. & Must bea good moral character andl must nat have been eenvitel ferme valving mol turpitude. (& Must oot have any pecuniary interest, directly or indectly, in any schooi, college, universy or institution conferring an _academic degree necessary fr admission tothe practice of accountancy or where review classes in preparation for he licensure examination ae being offered or conducte, nor shall he/she be a member ofthe faculty or administration there at tiie of his/her appointment tothe Board, 7. Which ofthe following statements is false regarding the quaifation of candidates to the CPA examinations? es Anatura torn ae resident ofthe Phipps. 1b, Of good moral character Solder ofthe 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 )_Not been convicted of any criminal offence involving moral turpitude, ny candidate wha fis in two (2} complete Certified Public Accountant Board Examinations shal be dsquafied fom taking another set of examinations unless heJshe submit evidence athe satisfaction nf the Boat that he/she enrolled in and eompletel at iast Twelve (12) units of subject given in the licensure examination, renty four (24) units of subject given inthe leensure examination. ‘Another reiew classes. 6 person who shal violate any ofthe provisions ofthe Accountancy Actor any ofits implementing rules and regulations as promulgated by the Board subject tothe approval ofthe Comission, shall upon conviction, be punishedby afine of 4 Not ess than Twenty Five Pesos (25,000.00 or by imprisonment for a petiod nat exceeding two(2] years o both, Not less than Fifty Thousand Pesos 50,000.00) or by mprsonment for a period not exceeding three (3) years or both, No iess than Fifty Thousand Pesos (50,000.00) or by mprisonment for a peri not exceeding two (2) years or both “4. _ Not less than Fifty Thousand Pesos (50,000.00) or by mprisonment for a period not exceeding three (3) years or both, The Philippine Accountancy Act of 2008 provides that all working papers made during an aut be the property af the autor. These ‘working papers shalinclude the folowing, except a, Schedules of memoranda made by the CPA and his staff. {© Working papers repare and submited bythe cent. Excerpts of copes of documents furnished tothe audtor Wo.) Reports submited by the CPALo the client b 10,PACASON, Hricmark 2% UNIT TESTIN AUDITING: The Professional Accountant | °9 ()4 4 1 Gost ea tari oT I RE ccs ‘A.CPAis in public accountancy when he/she renders his/her professional services as a CPA to more than one ellent on a fee basis in the design, installation, review, and revision of accounting systems and controls b. ACPA\sin the practice of accountancy in the ‘academe/education when he/she is an educational Institution teaching any ofthe subjects included inthe SA curriculum, & ACPAIsin the practice of accountaney in commerce and industry when his/her position requires civil service eligibility as 3 CPA, dd. ACPA\sin the practice of accountancy in the ‘government when he/she is involved in the audit or ification of financial transactions and accounting records of his/her clients Jef, Joy and Jai, CPAs, a newly formed partnership, applied for registration withthe Commission and the Board which was approved on June 30, 2004 The partnership should apply for renewal ofits registration on or before ‘September 30, 2011, September 30, 2012. & smber 31, 2013, etn ‘Which of the following statements concerning the use of firm fr partnership name is correct? 3. Inthe case of an individual CPA, he/she shall do business lunder his/her registered name with the BOA and the PRC and as printed in his/her CPA cenficate. For example, Joy Aguilar, PA, b. Inthe case ofa firm, i shall do busindss under its duly registered and authorized firm name appearing in the registrations decumants ised by the Department of ‘Trade and industry and ather government offices and such firm name shall include the real name ofthe sole proprietor as printed in his/her CPA certificate. For ‘example Jai Andre and Associates. ln the cate of a registered partnorthip, it hall do business under its name as indicated in its current [Asticles of Partnership and Certificate of Registration Issueld by the Securities and Exchange Commission. For example, left, oy & Jai, CPAs. ACPA shall practice only under an individual, firm, oF partnership name in accordance with Philippine laws and shal not include any fictitious name but may Indicate specialization 4. The following statements relate to CPE credit units. Which is Incorrect? ‘a. The total CPE units for registered accbunting professionals shall be 60 credit unis for 3 years, provided thet a minimum of 15 credit units shall be earned each year, ‘Any excess credit units in 1 year may be carried over to ‘the succeeding years within the 3-year period. Excess credit units earned may be carried over to the ext 3-year period including credit units earned for octaral and master’s degrees. 4. One credit hour of CPE program, activity or source shall be equivalent to 1 credit unit. 5,/ Which ofthe following statements concerning a CPA's disclosure of confidential client information is ordinarily © © correct? 3) Disclosure may be made to any party on consent ef the client. Disclosure should not be made even ifsuch disclosure will protect the CPA's professional interests i legal proceedings €. iselosure should be made only if there is a legal or professional duty to make the disclosure aa Te operations ofthe Cuality Assurance Revlew Department ofthe PICPA shall be supervised by a/an @ Executive Commitee 3. Supervisory Board ._Oyeright Commitee countably Board >As Tn public practice are required to register with the unity Assurance Review program under the prescribed category, Thove whose clients are publicintrest enties ~ listed and not-lste but with public accountability should reeister under 5) Category atepory ‘Thete are rules to observe In connéction with the registration of CPA practitioners withthe Quality Assurance Review program. Which is incorrect? a ACPA practitioner wil register in only 3 category division. © Change in registration isnot allowed. ‘Change in registration sub-category due tothe change in the numberof clients should be done upon renewal of reelstration within the fist 2 manths of each calendar ~ year 4, Al applications for registration must include information ‘2610 the number of clents classed as to publicinterest eptities using full IFS and small and medium-sized Kis ig to Se Fhe following securities are exempted from the registration requirement under Subsection 8.1 of the Securities fegulation Code, except S)Abank’s own shares of stock “Any secunty issued or guaranteed by the Government of the Philippines ‘& Any security sued by the government of any cuntry ‘with whieh the Philipines maintains diplomatic relations on the bass of reciprocity. 4. Any security orits derivatives, the sale or transfer of hich, bylaw, is under supervision and regulation ofthe Office of the Insurance Commission, Housing and Land Regulatory Board, or the Bureau of Internal Revenue. 19 AAecording to the Code of Ethics, professional competence may be avided into 2 phases: attainment of professional ‘competence and maintenance of professional competence ‘The attainment of aatessional competence requires the following, except : a Initisly high standard of education, . Specific education, training, and examination in professionally relevant subjects Whether prescribed or nat, a period of work experience ‘continuing awareness and an understanding of fant technical professional and business developments cording 1 Section 240 ofthe Cade of Ethie, fes charged for assurance engagements should be 2 faireflection of the valu ofthe work involved, in determining profesional fes, the following should be taken into account, except 2, The time necessaiy occupied by each person engaged onthe wo (© Trecuicome or re of wansacion othe est of theworkperormed These trowidge required forthe rp of wrk Ino, Totevel ot raiigand excerence of the persons eesarly eng othe wrk 32, Which of the following would not, in itself, create a network?UNIT TEST IN AUDITING: The Professional Accountant 2011 @ arersuctte where teenies within the structure share costs that are limited only to those costs related to the development of audit methodologies, manl of traning courses 8. larger structure that aimed at cooperation and the tntiies within the stiture sare common ownership, Control or management. larger structure that s aimed at cooperation and the entities within the stuctre share common quality Contrl poles and procedures ‘largesrocture that ame at cooperation ants cleat aimed at pratt or cot sharing amon the ents within the structure, 13, Aselintrest eat created farm has materia finanealintezesin an entity that hae conralng interest n an asurance cent that nota ancl statement aud let. Which ofthe followings he only acton ppropriate {0 permit the femto perform the asauranee engagement? @_ Discuss the matter with those charged with governance, such athe aut committee Inve an dtinal profesional accountant who dd ‘not take part in the assurance engagement to review the work done by the assurance team, 6 Nosateguars ned be applied because he threats clear insignia Either dispore ofthe financial interest in total or dispose only a sufficient amount of it so that the remaining interest in no longer material 14, Thefolowing statements relat to the provlon of taxation, internal audit or IT Systems services to audit clients. Which is fae? SSH. Tesation services, including compliance, planning, provision of formal taxation opinion, and assistance the resolution of tax dupes may erate 8 threat A self-review threat may be created when a firm, or network frm, provides internal aut series oan aut cht He provision of services by afm ornetworktirm to an audit cen thatinvolve the design and implementation of financial information technology systems that ae used to generate information forming part of a client's cy financial statements may create a set revew tvest, @ The proision a series in connection vith the assesment, design, and implementation of iter Accounting contol and rs management cotrel does not create a threat to independence provided that firm ed, iccording to the Code, legal services encompass a wide and diversified range of areas including both corporate and commercial services to clients ~ such as contract support, litigation, mergers, and acquisition advice and support, and the provision of assistance to a client's internal legal department, The provision of legal services by a firm, or ‘network firm, to an audit client may create a. Selfinterest threat. Selfréview and advocacy threats. {vocacy and intimidation threats. Familiarity and intimidation threats. hich ofthe following is nat a factor to consider in determining the professional fee of a professional accountant In public practice? . 2. The skill and knowledge required far the type of professional services involved. The result ofthe assurance work. ‘6 The level of training and experience ofthe persons necessarily engaged in performing the professional 4d, The time necessarily occupied by each person engaged in performing the professional services. 27. The following statements relate tothe provisions ofthe Code Of Ethics that deal withthe professional accountant's ‘marketing of professional services. Which s false? 2, When 2 professional aécountant in public practice solets new work through advertising or other forms of marketing, a self interest threat to compliance withthe principe of profesional behaviour may be crested. ©) The professional accountant should be honest and truthful when marketing professional services Advertising and publicity are generally unacceptable. = d. When marketing professional services, the professional accountant should not make exaggerated claims for services offered, qualifications possessed and experience azine 38. Which ofthe following statements concerning publicity is Incorrect? a, Booklets and ather dacuments bearing the name of a professional accountant and giving technical information for the assistance of staff or clients may be issued to such persons, other professional accountants or other Interested parties. Professional accountants who autho! books or articles on professional subjects may state their name and professional qualifications; give the name of their ‘organization; and give any information as to the services ‘that the firm provides. Appropriate newspapers or magazines may be used to inform the public ofthe establishment of a new practice, lof changes in the composition of a partnership of professional accountants in public practice, or hy alteration in the address ofa practice. {A professional accountan: may develop and maintain = website in the internet in such suitable length and style Which may also include announcements, press releases, publications and such other necessary and factual information, 18. Which ofthe following are elements of a CPA firms quality ‘contral that should be considered in establishing its quality control policies and procedures? 2. Human resources Ethical requirements Ethical requirements, human resources and engagement performance 4. Engagement performance 20_AMG engagement partner should take responsibilty for the direction, supervision, and performance ofthe aut engagement in compliance with professional standards and regulatory nc legal requirements, an forthe auditor's ‘report that issued tobe appropriate inthe circumstances Supervision includes the following, except 4. Tracking the progress of the ait engagement. b. Addressing significant issues arising during the audit engagement, considering their significance, nd modifying the planned approach appropriately. © Informing the members ofthe engagement team of their 4 @ responsibilities, ‘demtifying matters for consultation ar consideration by ‘more experienced engagement team members during. ‘the audit engagement. ay Aostanes a5 9 Gen nclcies of stone escape so aa eA Se tena ee ae sz Poel ney tout tndevahtah seal et wo © warranting the infallibility of the work performed. SE consulting ethers i atonal technical information i fas 2