UPDATES ON GOVERNMENT

REPORTORIAL REQUIREMENTS
PROFESSIONAL REGULATIONS COMMISSION BOARD OF
ACCOUNTANCY (PRC-BOA)
PHILIPPINE SECURITIES AND EXCHANGE COMMISSION (SEC)
PROFESSIONAL REGULATION
COMMISSION BOARD OF
ACCOUNTANCY (PRC- BOA)
1. BOA Resolution No. 3-2016 (Compilation
Certificate)
a. Details
b. Coverage and Effectivity Date
c. Subsequent Amendments
d. Answer to Frequently Asked Questions
2. Accreditation of CPAs in Commerce and
Industry
a. Application Forms
b. List of Requirements
3. Accreditation of CPAs in Academe
a. Application Forms
b. List of Requirements
BOARD OF ACCOUNTANCY :
BOA RESOLUTION NO. 03 - 2016
Requiring the submission of Compilation Certificate by the responsible
Certified Public Accountants on the Compilation Services for the
preparation of financial statements and notes thereto.
Covers companies ( non-stock , non-profit) which Annual Gross Sales
exceeding 10M
CPA Compiler must accredited by the Board of Accountancy.
CPA Compiler should be other than your external auditor
BOA RESOLUTION NO. 03-2016:
MANAGEMENT RESPONSIBILITY VS. AUDITORS
RESPONSIBILITY

Responsible for the preparation Conduct audit of financial

and fair presentation of financial statements in accordance with
statements in accordance with Philippine Standards of Auditing
Philippine Financial Reporting (PSA)
Standards ( PFRS)
PSA requires the compliance to
Responsible to design, implement ethical standards. Require the
and maintain internal controls auditor to maintain objectivity
relevant to the preparation and fair and independence
presentation of financial Based on audit express opinion
statements whether the financial
statements are presented fairly
in accordance with PFRS
BOA RESOLUTION NO. 03-2016 : WHO CAN BE A COMPILER?

CPA EMPLOYEE Prepares CONTRACTED CPA

Financial
Statements

Notes to
Financial
Statement

A CPA employed by the Company A CPA contracted by the Company

as Chief Accountant, General to do the Compilation Services
Accountant or Comptroller Issues
Certificate
of Accredited by BOA as a CPA in
Accredited by BOA as a CPA in Compilation Public Practice
Commerce and Industry
BOA RESOLUTION NO. 03-2016 : COMPILER vs. AUDITOR

COMPILATION SERVICES AUDIT / ASSURANCE SERVICES

Contracted CPA External Auditor

CPA Employee

Prepares Financial Statements in Conducts audit in accordance with

accordance with Philippine Financial Philippine Standards in Auditing (PSA)
Reporting Standards (PFRS)
Issues Audit Certificate
Issues Certificate of Compilation
BOA RESOLUTION UPDATES :
AMENDMENTS
BOA Res. No.
BOA Res No. BOA Res. No.
115-2016
03-2016 68-2016 (First
(Latest
(Original) Amendment)
Amendment)
Date of Issue 19-Jan-2016 21-Mar-2016 25-April-2016

Annual Gross Annual Gross

Covered Entities Sales exceeding Sales exceeding Under - review
10M 10M

FS Ending
FS ending March FS Ending June
Covered Period December 31,
31, 2016 30, 2016
2016
Deadline of
Accreditation by 29-Feb-16 30-Apr-16 31-Dec-16
CPA Employee
FREQUENTLY ASKED QUESTIONS:
BOA Resolution 3-2016 and other related
issuances
FAQS ON BOA RESOLUTION 3-2016 AND OTHER RELATED ISSUANCES

Rationale for the issuance of BOA resolution 03-2016

The requirements prescribed are intended to address the following:

the self-review threats or risks in external audit of FS,

need to have professional competence in the preparation of the FS,

to pinpoint responsibility in the compilation services in the preparation of the FS as

allowed and required under the Accountancy Law and the Code of Ethics of the CPAs.
Furthermore, this new rule will help in the further enhancement of the reliability of the
annual statutory FS being submitted to the SEC and the BIR.
With the signing of this Certificate by the CPA who is responsible for the preparation of the
FS, accountability on the part of the CPA will be pinpointed and his/her obligation to do
diligent work will further be reinforced
FAQS ON BOA RESOLUTION 3-2016 AND OTHER RELATED ISSUANCES
Who are covered by this requirement of submission of the Certificate for compilation
services for the preparation of FS?

Organizations (including stock, for profit, non-stock and/or non-profit organizations) and
persons which/who:

1. Are required to submit annual statutory FS to the BIR and/or SEC, and
2. Have annual gross sales/receipts/ revenues of over P10Million

What is included in the determination of the over P10Million threshold of gross

sales/receipts/revenues reported in the FS that will subject said FS to these rules?

These include all receipts or revenues/sales from all sources reported in the FS, including,
but not limited to, gross receipts or revenues/sales from operations, non-recurring activities,
passive income and others
FAQS ON BOA RESOLUTION 3-2016 AND OTHER RELATED ISSUANCES
What does the over 10Million threshold provision in Section 3 of Resolution 3-2016 cover?

The provision on Section 3 of the Board Resolution 03-2016 pertaining to the over P10Million
threshold of annual revenues and receipts shall only apply to the preparation and submission of
the Certificate by the CPA.

The same over P10Million threshold shall apply to the requirement that only CPA who are duly
accredited with the PRC/BOA shall be authorized to prepare the FS for all companies and
persons submitting statutory annual reports. In other words, those companies whose gross
annual sales/receipts/revenues do not exceed P10Million are not required to have CPAs
prepare their FS.

However, once companies exceed the over P10Million threshold, the requirement that
only accredited CPAs preparing the FS shall apply and will continue thereafter.
 FAQS ON BOA RESOLUTION 3-2016 AND OTHER RELATED ISSUANCES

Has BOA coordinated with SEC and BIR regarding this BOA requirement of attachment of
the Certificate in the annual statutory FS filed with the SEC & BIR?

The BOA has advised the Department of Finance, BIR and SEC on this new Resolution and
requested the SEC and BIR to monitor the compliance of submission of the Certificate in
the filing of the annual statutory FS in the BIR and SEC.

How will the BOA monitor the compliance of the submission or attachment of the
Certificate in the annual statutory FS submitted to the BIR and SEC?

The BOA has requested the BIR and SEC to assist in dissemination of the Resolution and in
the monitoring the compliance of those submitting the annual statutory FS.
 FAQS ON BOA RESOLUTION 3-2016 AND OTHER RELATED ISSUANCES
What are the sanctions that may be imposed for violations or non-compliance with the
provisions of the Resolution? Who will be penalized, the CPA issuing the Certificate or the
External Auditor?

Violations or non-compliance such as:

1. The CPA preparer of FS of a covered company filing its FS with the SEC and BIR without
attaching the Certificate,
2. The application for accreditation of the CPA not being approved/denied because of
oversight/negligence/failure to comply with the accreditation requirement after the FS
has been issued;
3. The auditor of an organization is the one doing the compilation services for the
preparation of the FS and notes of his/her audit client
4. Failure of the external auditor to monitor the compliance of audit clients
5. Failure of the external auditor to report to BOA the cases of omissions or non-
compliance of clients on the measures of the resolutions
6. Other cases, will result in sanctions that will be imposed on either CPA and/or External
Auditor
FAQS ON BOA RESOLUTION 3-2016 AND OTHER RELATED ISSUANCES

Sanctions that may be imposed:

1. Reprimand the CPA

2. Suspension of license of the CPA
3. Imposition of fines and penalties on the CPA
4. Revocation of license of the CPA, and/or
5. Requirement for submission or re-submission of a corrected or valid Certificate to
replace the defective Certificate previously issued with the imposition of the
corresponding sanctions on the erring CPA
FAQS ON BOA RESOLUTION 3-2016 AND OTHER RELATED ISSUANCES

When shall the CPA preparing the FS of a company/person complete the FS and
notes thereto for presentation to the external auditor?

CPAs preparing the FS shall complete the FS and notes thereto for presentation to the external
auditor/s to use in their audit not later than 2 months of the closing of the accounting
period or year of the company.

This deadline is required to give ample time for the completion of the subsequent audit work of
the external auditor and the submission of the statutory report before the statutory deadlines.
HOW TO BE AN ACCREDITED CPA? FOR 2016 Initial
Application only
CPA IN COMMERCE AND INDUSTRY

Application Form;

Certificate of Employment;

Detailed description of work experience

Photocopy of updated PRC ID

Certificate of Membership in Good Standing from the current Accredited Integrated Professional
Organization (AIPO) for the accountancy profession;

Certificates for CPD credit units;

Payment of accreditation fee

Short Brown Envelope for the Certificate of Accreditation;

Set of documentary stamps

HOW TO BE AN ACCREDITED CPA? Starting 2017 Initial
Application onwards
CPA IN COMMERCE AND INDUSTRY

ADDITIONAL REQUIREMENTS:

Sworn statement by the CPA, stating that he/she:

Has undergone adequate and effective training (from organizations duly accredited by the Board or by its duly authorized representatives) on all the
current accounting and auditing standards, code of ethics, laws and their implementing rules and regulations, circulars, memoranda their respective
codes of good governance and other related documents to ensure professional, ethical and technical standards;
Is of good moral character; and
Has not been found guilty by any competent court and/or administrative body of an offense involving moral turpitude and/or any act constituting unethical
practices.

Copy of CPA Integrity Pledge

HOW TO BE AN ACCREDITED CPA? FOR 2016 Initial
Application only
CPA IN ACADEME

Application Form;

Certificate of Employment / Appointment as Faculty Member from the educational institution the CPA applicant is currently teaching,;

Photocopy of updated PRC ID

Certificate of Membership in Good Standing from the current Accredited Integrated Professional Organization (AIPO) for the accountancy profession;

Certificates for CPD credit units earned;

Payment of accreditation fee

Short Brown Envelope for the Certificate of Accreditation;

Set of documentary stamps.

HOW TO BE AN ACCREDITED CPA? Starting 2017 Initial
Application onwards
CPA IN ACADEME

ADDITIONAL REQUIREMENTS:

A sworn statement by the individual CPA that he has at least three (3) years of meaningful experience in any of the areas of the practice of accountancy with
a detailed description of such work experience

Photocopy of CPA Board Certificate;

Certified copy of diploma / transcript of records of the relevant graduate degree program
 PHILIPPINE SECURITIES AND
EXCHANGE COMMISSION
SEC Reminder on Strict Compliance of Financial
Reporting Obligations
Audit Requirement
Sworn Statement for Foundation
Sworn Statement for Non-stock, Non- profit
organizations
New Cover sheet
General Information Sheet
 SEC UPDATES: REMINDER FOR STRICT COMPLIANCE OF
FINANCIAL REPORTING OBLIGATIONS (SRC 68)
Corporations financial statements are the responsibility of their respective
management as reflected in the SMR.
Management should provide a complete set of financial statements including
schedules and reconciliations forming part the financial statements.
The external auditor must not create template format of financial statements
for mere accomplishment by the management
The management should provide schedules, computations, projections, reports,
analysis and such additional information the auditor may request from management
The management shall provide unrestricted access to records and personnel of
the entity from whom the auditor deems it necessary to obtain audit evidence.
SEC ISSUES A REMINDER FOR STRICT COMPLIANCE OF
FINANCIAL REPORTING OBLIGATIONS
PFRS VS. PFRS FOR SME

PFRS (Full PFRS for

PFRS) SMES

Assets over 350M 3M to 350M

Liabilities over 250M 3M to 250M

SEC UPDATES : LIST OF AUDIT
REQUIREMENTS
1. Unaudited Complete Set of Financial Statements (SALF,
SRD,SFB, CFS, NFS)
2. Unaudited Trial Balance
3. Books of Accounts ( GL, CDB,CRB,SB,GJB)
4. Subsidiary Records (DCR, Budget)
5. Accounting Records (OR, SI, CV, JV, paid check, deposits slips)
6. Articles and By Laws, GIS, Board Resolutions, Minutes of
Meeting, Organizational Chart, Duties and Responsibilities
7. Contracts and agreements
8. Documents and Schedules to support Balance Sheet Accounts
SEC UPDATES : LIST OF AUDIT REQUIREMENTS
DOCUMENTS AND SCHEDULES SUPPORTING BALANCE SHEET
ACCOUNTS
1. CASH ON HAND list of cash on hand/ cash count sheet
2. CASH EQUIVALENTS - bank recon statement, passbook, bank
statement, certificate of deposit, bank confirmation,
3. RECEIVABLES Schedule Receivables, Aging of Receivables,
Receivable Confirmation. Schedule of Advances to Officers and
Employees
4. PREPAYMENTS Schedule of prepayments
5. INVENTORIES Inventory Sheet
SEC UPDATES : LIST OF AUDIT
REQUIREMENTS
DOCUMENTS AND SCHEDULES SUPPORTING BALANCE SHEET
ACCOUNTS
5. PROPERTY AND EQUIPMENT - Lapsing Schedule, Inventory of Property
and Equipment
6. INVESTMENTS Schedules of Investment, Investment Contract or
documents
7. PAYABLES Schedule of Payables , Payable Confirmation
8. LOAN PAYABLES - Loan agreement
9. OTHERS Schedule of Fees, Schedule of Donations
SEC SWORN STATEMENT (MC NO. 4 SERIES OF 2013)
The following documents shall be filed with the annual audited
financial statements and in the interim financial statements, if
required herein
A. Non-Stock and Non-Profit Organizations
A Sworn Statement of the organizations President and Treasurer
on the accuracy and completeness of the following schedules:
1. Schedule of Receipts or Income Other than Contributions and
Donations. Provide nature and amount of each item
2. Schedule of Contributions and Donations
3. Schedule of Disbursements according to sources and activities.
SEC SWORN STATEMENT (MC NO. 4 SERIES OF 2013)
The following documents shall be filed with the annual audited
financial statements and in the interim financial statements, if
required herein
B. Foundations
A Sworn Statement of the organizations President and Treasurer on the accuracy and
completeness of the following schedules:
1. Schedule of Sources of Funds other than Contributions and Donations. Provide
nature and amount of each item
2. Schedule of Contributions and Donations
3. Schedule of Disbursements according to sources and activities.
SEC SWORN STATEMENT (MC NO. 4 SERIES OF 2013)
The following documents shall be filed with the annual audited
financial statements and in the interim financial statements, if
required herein contd
B. Foundations
4. Schedule of application of funds with the following information on activities
accomplished, on-going and planned:
a. Complete name, address and contact number of project officer-in-charge;
b. Complete address and contact number of project office.
5. Supporting documents such as:
a. Copies of the Certification on the Existence of the subject program or activity in
the locality on which it exercises jurisdiction. Which may come from either of the
following:
i. Office of the Mayor;
ii. Head of Department of Social Welfare and Development;
iii. Head of Department of Health
 SEC Sworn Statements

For Non-Stock Non-Profit

For Foundations Microsoft Excel Microsoft Excel
Worksheet Organizations Worksheet

SEC Cover Sheet

For Audited Financial For Registration For Amendment
Statements
Foxit Reader PDF Foxit Reader PDF Foxit Reader PDF
Document Document Document

General Information Sheet (GIS) Microsoft Excel

97-2003 Worksheet