ACREV 426 – RA 9298 AND CODE OF ETHICS AT-03303
1. The following are qualifications of the members of the Board of
Accountancy, except:
A. Natural-born citizen and resident of the Philippines.
B. Duly registered CPA with at least 5 years of work experience in any scope
of practice of accountancy.
C. Good moral character, not convicted of crimes involving moral turpitude
D. No direct, or indirect pecuniary interest in any school, college, university
or institution conferring the B.S. Accountancy degree or providing CPA
Review classes
2. The Accredited National Professional Organization (APO) shall submit
its nominations for the Board of Accountancy (with complete
documentation) to the Commission
A. Not later than sixty (60) days prior to the expiry of the term of an
incumbent chairman or member.
B. On the date of expiry of the term of an incumbent chairman or member.
C. After the 60th day from the expiry of the term of an incumbent chairman
or member.
D. Upon request by the Commission for the submission of nominations.
3. The following are among the powers and functions of the Board of
Accountancy, except:
A. To prescribe and adopt the rules and regulations necessary for
implementing RA9298.
B. To prescribe and/or adopt a Code of Ethics for the practice of
accountancy.
C. To ensure, in coordination with the DECS that all higher educational
instruction and offering of accountancy comply with prescribed policies,
standards and requirements of the course.
D. To conduct an oversight into the quality of audits of financial
statements.
4. Which of the following statements is correct?
A. The chairman and members of the Board shall receive compensation
and allowances comparable to that being received by the Chairman and
the members of the existing regulatory boards under the PRC as provided
for in the General Appropriations Act.
B. No person shall serve in the Board for more than nine years.
C. The BOA Chairman has the sole power to administer oaths in
connection with the administration of the Accountancy Law.
D. The Board shall be under the administrative supervision of the PICPA.
5. The following are grounds for suspension or removal of members of the
Board of Accountancy, except:
A. Neglect of duty or incompetence.
B. Violation or tolerance of any violation of RA9298 and its IRR, or the Code
of Ethics and technical and professional standards of practice for CPAs.
C. Pending case on a crime involving moral turpitude.
D. Manipulation or rigging of the CPA licensure examination results.
6. Who is the person that has the authority to suspend or remove a
member of the BOA, on valid grounds and after due process?
A. The President of the Republic of the Philippines
B. The Chairman of the Professional Regulatory Board of Accountancy,
unless he is the one who is under investigation
C. The Commissioner of the Professional Regulation Commission
D. None of them.
7. This organization administers, implements and enforces the regulatory
policies of the Philippine Government with respect to the regulation and
licensing of the various profession under its jurisdiction, one of which is
accountancy.
A. BOA
B. PICPA
C. COA
D. PRC
8. According to the IRR, this council is tasked to assist the BOA in
continuously upgrading accountancy education in the Philippines to
make the Filipino CPAs globally competitive.
A. Quality Review Committee
B. Education Technical Council
C. CPE Council
D. Commission on Higher Education
9. The Education Technical Council shall be composed of
A. Six members.
B. Seven members with a Chairman.
C. Seven members with a Chairman and a vice-chairman.
D. Eight members with a Chairman, a vice-chairman, and a secretary.
10. S1 The Philippine Institute of Certified Public Accountants is registered
with the SEC as a nonprofit corporation and recognized by the BOA,
subject to the approval by the PRC.
S2 Membership in the PICPA shall be a bar to membership in any other
association of certified public accountants.
A. True, true
B. True, false
C. False, true
D. False, false
11. Unless there is a valid reason to have additional representation, the
PICPA shall have how many national directors?
A. 12
B. 14
C. 15…..
D. 20
12. The PICPA national directors shall be apportioned according to four
geographic sectors based on the ratio of latest available number of
members in good standing from those areas. Which of the following is
NOT a geographic sector?
A. Luzon
B. NCR
C. Mindanao
D. CAR
13. A PICPA director can only represent a sector in a region if he/she has
been a member in good standing in such sector in the region for at least
___ years at the time of his/her nomination:
A. Two years
B. Three years
C. Four years
D. Five years
14. PICPA shall renew its certificate of accreditation once:
A. Annually
B. Every 3 years
C. Every 4 years
D. Every 5 years
15. Sectoral organizations have been established to promote the interests
of groups of professional accountants. Which of the following is the
sectoral organization for CPAs in Public Practice?
A. GACPA.
B. ACPAPP.
C. ACPACI.
D. ACPAE.
16. The PRC CPE Council shall be composed of:
A. A chairperson and three members
B. A chairperson, vice-chairperson and two members
C. A chairperson and two members
D. A chairperson, vice-chairperson and three members
17. The Chairpersons of the FRSC and the AASC shall be appointed by:
A. The President of the Republic of the Philippines.
B. The Professional Regulatory Board of Accountancy.
C. The Professional Regulation Commission.
D. The Philippine Institute of Certified Public Accountants.
18. This committee is created to conduct an oversight into the quality of
audits of financial statements through a review of the quality control
measures instituted by Individual CPAs, Firms, or Partnerships.
A. Quality Review Council
C. Quality Review Committee
B. Quality Control Committee
D. Engagement Quality Control Review
19. The QRC shall have the following functions:
A. Conduct quality control review on applicants for registration to practice
public accountancy and render a report on such quality review
B. Revoke the certificate of registration and professional ID of an individual
CPA, firm, or partnership of CPAs who have not observed quality control
measures.
C. All of the answers
D. None of the answers
20. The Constitution of the Philippines requires this Office to “keep the
general accounts of the Government and for such period as may be
provided by law, preserve the vouchers pertaining thereto.”
A. National Accounting Office
C. Commission on Audit
B. Ministry of Finance
D. Accounting Units
21. The following are the duties of the Commission on Audit (COA), except:
A. Define the scope of its audit and examination
B. Promulgate accounting rules and regulations
C. Keep the general accounts of the government
D. Assume fiscal responsibility for the Government and its instrumentalities
22. Who appoints the members of the COA?
A. The Commissioner of the Professional Regulation Commission
B. The Chairman of the Professional Regulatory Board of Accountancy
C. The President, with the concurrence of the Commission on
Appointments
D. The Chairman of the Auditing and Assurance Standards Council
23. Which of the following is a correct qualification of the Chairman and
Two Commissioners of the COA?
A. A naturalized citizen of the Philippines
B. At least 40 years of age upon appointment
C. CPAs with no less than 5 years of auditing experience or members of the
Philippine bar who have been engaged in law practice for at least 5 years
D. Must not have been candidates for any elective position preceding
appointment
24. Which of the following statements best describes why the CPA
profession has deemed it essential to promulgate a code of professional
ethics and to establish a mechanism for enforcing observation of the
Code?
A. A distinguishing mark of a profession is its acceptance of responsibility
to the public.
B. A pre-requisite to success is the establishment of an ethical code that
primarily defines the professional’s responsibility to clients and colleagues.
C. A requirement of most state laws calls for the profession to establish a
code of ethics.
D. An essential means of self-protection for the profession is the
establishment of flexible ethical standards by the profession.
25. S1 Professional accountants refer to persons who are registered in the
PRC as CPAs and who hold a valid certificate issued by the BOA, whether
they be in any sector of practice of accountancy.
S2 The Code of Ethics for Professional Accountants in the Philippines is
mandatory for all CPAs.
A. True, false (X)
B. False, true
C. True, true
D. False, false (X)
26. In the few instances where the domestic laws are in conflict with the
IFAC Code,
A. Both are applied simultaneously.
B. The IFAC Code requirement prevails
C. The local law prevails
D. There will be no ruling for that particular requirement.
27. The fundamental principle of integrity requires a CPA to
A. Be straightforward and honest in performing professional services.
B. Be fair and should not allow prejudice or bias, conflict of interest or
influence of others to override objectivity.
C. Perform professional services with due care, competence and diligence.
D. Act in a manner consistent with the good reputation of the profession
and refrain from any conduct which might bring discredit to the
profession.
28. This fundamental principle requires a CPA not to use or disclose
information acquired during the course of performing professional
services without proper and specific authority:
A. Objectivity
C. Professional Behavior
B. Professional Competence and due Care
D. Confidentiality
29. The following steps are part of the conceptual framework approach to
the Code of Ethics. Set the steps in proper order.
I. Address threats which are other than clearly insignificant through the
application of safeguards.
II. Evaluate the significance of threats to compliance with fundamental
principles.
III. Identify threats to compliance with the fundamental principles.
A. I, II, III
B. II, III, I
C. III, I, II
D. III, II, I
30. If a CPA cannot implement appropriate safeguards, the professional
accountant should do the following, except:
A. Decline the specific professional service involved.
B. Discontinue the specific professional service involved.
C. Resign from the client or the employing organization, as necessary.
D. Issue an adverse opinion on the subject matter of the engagement.
31. An inadvertent violation of the Code of Ethics, depending on the nature
and significance of the matter, may not compromise compliance with the
fundamental principles provided, once the violation is discovered,
A. The CPA withdraws from the specific professional service involved.
B. A disclaimer of opinion is issued to the client as a result of the violation.
C. The violation is corrected promptly and any necessary safeguards are
applied.
D. The engagement is promptly transferred to another, non-violating
professional accountant.
32. Compliance with fundamental principles may potentially be threatened
by a broad range of circumstances. These are known as:
A. Fraud risk factors.
C. Threats to independence.
B. Threats to fundamental principles
D. Safeguards to threats.
33. These are policies and procedures designed to eliminate or to reduce
threats to fundamental principles to an acceptable level.
A. Internal controls
C. Safeguards
B. Control activities
D. Segregation of duties
34. Certain safeguards may increase the likelihood of identifying or
deterring unethical behavior. Such safeguards, which may be created by
the accounting profession, legislation, regulation or an employing
organization, include, but are not restricted to:
I. Effective, well publicized complaints systems operated by the employing
organization, the profession or a regulator, which enable colleagues,
employers and members of the public to draw attention to unprofessional
or unethical behavior.
II. An explicitly stated duty to report breaches of ethical requirements.
A. I only
B. II only
C. I and II
D. Neither I nor II
35. When initiating either a formal or informal conflict resolution process,
a CPA should consider the following, either individually or together with
others, as part of the resolution process:
I. Relevant facts
II. Ethical issues involved
III. Fundamental principles related to the matter in question
IV. Established internal procedures
V. Alternative courses of action
A. I, II, III, and V.
C. I, II, V.
B. I, III, IV, and V.
D. I, II, III, IV, V.
36. In ethical conflict resolution, if the matter remains unresolved, the CPA
should
A. Consult with other appropriate persons within the firm or employing
organization for help in obtaining resolution.
B. Consider consulting with those charged with governance of the
organization, such as the board of directors or the audit committee.
C. Document the substance of the issue and details of any discussions
held or decisions taken,concerning that issue, as necessary.
D. All of the above.
37. Under the Revised Code, which fundamental principle is explicitly
mentioned to be safeguarded even as the CPA consults with relevant
professional bodies and legal advisors?
A. Technicality
B. Confidentiality
C. Integrity
D. Objectivity
38. Tisha, CPA, has exhausted all relevant possibilities in an ethical conflict
which she is trying to resolve. The conflict remains unresolved.
Accordingly, the revised Code allows which of the following steps to be
taken by Tisha?
I. Refuse to remain associated with the matter creating the conflict.
II. Withdraw from the engagement team or specific assignment.
III. Resign from the engagement
IV. Resign from the firm or the employing organization
A. I and II
C. II, III and IV
B. III and IV
D. I, II, III and IV
39. A CPA should not be associated with reports, returns, communications
or other information where they believe that the information:
A. Contains a materially false or misleading statement.
B. Contains statements or information furnished recklessly.
C. Omits or obscures information required to be included where such
omission or obscurity would be misleading.
D. All of these
40. Objectivity in the Code refers to a CPA’s ability:
A. To maintain an impartial attitude on all matters which come under the
CPA’s review.
B. To independently distinguish between accounting practices that are
acceptable and those that are not.
C. To be unyielding in all matters dealing with auditing procedures.
D. To independently choose between alternate accounting principles and
auditing standards.
41. A CPA should maintain objectivity and free of conflicts of interest when
performing:
A.Audits, but not any other professional services.
B.All attestation services, but not other professional services.
C. All attestation and tax services, but not other professional services.
D. All professional services.
42. Which of these phrases describe attainment of professional
competence?
A. A high standard of general education followed by specific education,
training and examination in professionally relevant subjects, and whether
prescribed or not, a period of work experience.
B. A continuing awareness and an understanding of relevant technical
professional and business developments.
C. The responsibility to act in accordance with the requirements of an
assignment, carefully, thoroughly and on a timely basis
D. Making clients, employers or other users of the professional services
aware of limitations inherent in the services to avoid the misinterpretation
of an expression of opinion as an assertion of fact
43. Competence as a CPA includes all of the following, except:
A. Having the technical qualifications to perform an engagement.
B. Possessing the ability to supervise and evaluate the quality of staff work.
C. Warranting the infallibility of the work performed.
D. Consulting others if additional technical information is needed.
44. After beginning an audit of a new client, Sydney, CPA, discovers that
the professional competence necessary for the engagement is lacking.
Sydney informs management of the situation and recommends another
CPA, and management engages the other CPA. Under these
circumstances:
A. Sydney’s lack of competence should be considered to be a violation of
generally accepted auditing standards.
B. Sydney may request compensation from the client for any professional
services rendered to it in connection with the audit.
C. Sydney’s request for a commission from the other CPA is permitted
because a more competent audit can now be performed.
D. Sydney may be indebted to the other CPA since the other CPA can
collect from the client only the amount the client originally agreed to pay
Sydney.
45. Samuel Commercial Inc. engages the services of Rita Ube, CPA, to
make a project study on the expanded food vending operations of the
corporation with the corresponding staffing and compensation package
for its executive staff. Rita, however, has primarily auditing expertise and
only in general merchandising operations. Ms. Ube may properly:
A. Accept the engagement and carry it out consistent with GAAS.
B. Accept the engagement but exercise due professional care.
C. Accept the engagement and acquire the necessary competence or
consult with established authorities.
D. Decline the engagement for lack of experience or competence in an
entirely new line of specialization.
46. S1 A CPA should maintain confidentiality even in a social environment.
S2 A CPA should also maintain confidentiality of information disclosed by
a prospective client or employer.
A. True, false
B. False, true
C. True, true
D. False, false
47. A CPA shall not disclose any confidential information obtained in the
course of a professional engagement except with the consent of the client.
This rule should be understood to preclude a CPA from responding
from an inquiry made by:
A. The trial board of the Code of Professional Ethics.
B. An investigative body of a CPA society.
C. A CPA-shareholder of the client corporation.
D. A Code of Professional Conduct voluntary quality review body.
48. In which of the situations given below would disclosure by a CPA be in
violation of the Code?
A. Disclosing confidential information in order to properly discharge the
CPA’s responsibilities in accordance with his profession’s standards.
B. Disclosing confidential information in compliance with a subpoena
issued by a court.
C. Disclosing confidential information to another accountant interested in
purchasing the CPA’s practice.
D. Disclosing confidential information in a review of the CPA’s professional
practice by the PICPA Quality Review Committee.
49. In deciding whether to disclose confidential information, professional
accountants should consider the following points:
A. Effect of the disclosure on the interests of the client, the CPA, and third
parties, even if consent of the client was given.
B. Knowledge and substantiation of all relevant information, to the extent
practicable.
C. Type of communication that is expected and to whom it is addressed.
D. All of the above are considered.
50. In marketing and promoting themselves and their work, CPAs should
NOT
B. Bring the profession into disrepute.
C. Make exaggerated claims for the services they are able to offer, the
qualifications they possess, or
experience they have gained.
D. Make disparaging references or unsubstantiated comparisons to the
work of others.
E. All of the above.
51. A CPA in public practice should NOT:
A. Engage in any business, occupation or activity aside from his/her public
accounting practice.
B. Engage in any business, occupation or activity that impairs or might
impair integrity, objectivity or the good reputation of the profession
C. Engage in teaching or provision of accounting instruction while still in
public practice, since this would cause a division of time and effort,
resulting to impairment of the quality of service provided to clients.
D. Engage in non-accounting related activities which also involve members
of the companies that comprise his/her audit clients.
52. The nature and significance of threats may differ depending on
whether they arise in relation to the provision of services to a client. In
which of the following types of clients would the Revised Code provide
the strictest set of requirements regarding independence?
F. A financial statement audit client.
G. A non-financial statement audit assurance client.
H. A non-assurance client.
I. A non-client.
53. Client issues that, if known, could threaten compliance with the
fundamental principles include the following, except:
A. Client involvement in illegal activities (such as money laundering) /
B. Dishonesty /
C. Questionable financial reporting practices /
D. Conservative basis in determining accounting estimates
54. Appropriate safeguards during client acceptance may include:
A. Obtaining knowledge and understanding of the client
B. Obtaining knowledge and understanding about the client’s owners,
managers and those responsible for its governance and business
activities
C. Securing the client’s commitment to improve corporate governance
practices or internal controls.
D. All of these.
55. S1 A CPA in public practice should agree to provide only those services
that the CPA in public practice is competent to perform. S2 Acceptance
decisions need not be periodically reviewed for recurring client
engagements.
A. True, false
B. False, true
C. True, true
D. False, false
56. S1 An existing accountant is bound by confidentiality. S2 Written client
permission is required when initiating communication with an existing
accountant.
A. True, false
B. False, true
C. True, true
D. False, false
57. Regarding conflicts of interest, the following safeguards are applicable
(select the exception):
A. Notifying the client of the firm’s business interest or activities that may
represent a conflict of interest, and obtaining their consent to act in such
circumstances.
B. Notifying all known relevant parties that the CPA in public practice is
acting for two or more parties in respect of a matter where their respective
interests are in conflict, and obtaining their consent to so act.
C. Notifying the client that the CPA in public practice does not act
exclusively for any one client in the provision of proposed services and
obtaining their consent to so act
D. Clear guidelines for members of the client personnel on issues of
security and confidentiality.
58. Which fundamental principle may be threatened when the CPA in
public practice is asked to provide a second opinion on the application of
accounting, auditing, reporting or other standards or principles to
specific circumstances or transactions by, or on behalf of a company or
entity that is not an existing client?
A. Integrity
B. Professional competence and due care
C. Confidentiality
D. Professional behavior
59. A client seeking a second opinion does not permit the CPA to
communicate with the existing accountant. In such cases, the CPA should:
A. Issue a disclaimer of opinion due to a significant client-imposed scope
limitation.
B. Consider whether, taking all the circumstances into account, it is
appropriate to provide the opinion sought.
C. Consider whether to issue a qualified opinion or disclaimer of opinion
due to a significant client- imposed scope limitation.
D. Communicate the client’s refusal directly to the existing accountant.
60. In which of the following situations would a CPA be in violation of the
rules of professional ethics in determining professional fees?
A. A fee based on appropriate rates per hour or per day for the time of
each person engaged in performing professional services.
B. A fee which is lower compared to the fee charged in the prior year for
similar services.
C. A fee based on appropriate rates per hour, where the appropriate rate is
based on the fundamental premise that the organization and conduct of
the CPA and the services provided to clients are well planned, controlled
and managed.
D. A fee that is based on 10% of the client’s adjusted net income for the
current year.
61. Professional fees should be a fair reflection of the value of the
professional services performed for the client, taking into account:
A. The skill and knowledge required for the type of profes11sional services
involved.
B. The level of training and experience of the persons necessarily engaged
in performing the professional services
C. The time necessarily occupied by each person engaged in performing
the professional services
D. The degree of responsibility and urgency that performing those services
entails
E. All of the answers
62. Contingent fees are widely used for certain types of non-assurance
engagements. They may, however, give rise to threats to compliance with
the fundamental principles, especially the principle of:
A. Objectivity
C. Confidentiality
B. Professional competence and due care
D. Professional behavior
63. The Code of Ethics would be violated if a CPA represents that specific
consulting services will be performed for a stated fee and it is apparent at
the time of the representation that the
A. Actual fee would be substantially higher.
B. Actual fee would be substantially lower than the fees charged by other
professional accountants for comparable services.
C. Fee was a competitive bid.
D. CPA would not be independent.
64. A CPA in public practice should not pay or receive a referral fee or
commission, unless the CPA in public practice has established:
A. Internal controls designed to scientifically compute the referral fee or
commission.
B. That explicit approval to pay or receive commissions has been obtained
from the Securities and Exchange Commission.
C. Safeguards to eliminate or reduce threats to fundamental principles to
an acceptable level.
D. Another company as recipient, whose name does not include the name
of the CPA in public practice.
65. The payment or receipt of referral fees or commissions may create
threats to which fundamental principles?
I. Integrity
II. Objectivity
III. Professional competence and due care
IV. Professional behavior
A. I and III
B. I and IV
C. II, III and IV
D. II and III
66. The receipt of gifts and hospitality from a client may create threats to
fundamental principles. Which of the following is a correct combination of
threat and fundamental principle created by this situation?
A. Self-interest threat – professional competence and due care.
B. Intimidation threat – integrity
C. Self-interest threat – objectivity
D. Advocacy threat – objectivity
67. Which statement is incorrect regarding custody of clients’ assets?
A. Client’s assets should not be held by the CPA if there is reason to believe
that the assets were obtained from, or are to be used for, illegal activities.
B. Custody of clients’ assets may create a self-interest threat to objectivity
and professional behavior.
C. No safeguards are applicable to reduce threats created by having
custody of clients’ assets.
D. Fees due from a client may be drawn from client’s monies, subject to
client approval.
68. The state of mind that permits the provision of an opinion without
being affected by influences that compromise professional judgment,
allowing an individual to act with integrity, and exercise objectivity and
professional judgment.
A. Professional skepticism
C. Objectivity
B. Integrity
D. Independence of mind
69. The avoidance of facts and circumstances that are so significant a
reasonable and informed third party, having knowledge of all relevant
information, including any safeguards applied, would reasonably
conclude a firm’s, or a member of the assurance team’s, integrity,
objectivity or professional skepticism had been compromised.
A. Principle of segregation
C. Functional integrity
B. Independence in appearance
D. Preemptive estoppel
70. If the firm had a material financial interest, whether direct or indirect,
in the assurance client, the self-interest threat created:
A. Can be reduced by the application of appropriate safeguards as
mentioned in Section 290.32 of the Revised Code.
B. Would be insignificant if the financial interests are disposed of within the
most practicable time (i.e., within three months from the date of
acceptance of the engagement).
C. Must be eliminated by written disclosure to the BOA, the SEC, and the
AASC of such material financial interest, provided such disclosure is made
within sixty (60) days from the date of acceptance of the engagement.
D. Would be so significant no safeguard could reduce the threat to an
acceptable level.
71. Certain entities may be of significant public interest because, as a
result of their business, their size or their corporate status they have a
wide range of stakeholders. Examples of these entities include (select
the exception):
A. Non-listed companies
C. Insurance companies
B. Credit institutions
D. Pension funds
72. A CPA in business may be:
A. a salaried employee.
B. a partner, director (whether executive or non-executive) or an owner
manager.
C. a volunteer or another working for one or more employing organization.
D. Any of these.
73. S1 The legal form of the relationship with the employing organization, if
any, has no bearing on the ethical responsibilities incumbent on the
professional accountant in business. S2 A professional accountant in
business has a responsibility to further all the business aims of their
employing organization.
A. True, false
B. False, true
C. True, true
D. False, false
74. CPA in business should maintain information for which he/she is
responsible in a manner that:
A. Describes clearly the true nature of business transactions, assets or
liabilities.
B. Classifies and records information in a timely and proper manner.
C. Represents the facts accurately and completely in all material respects.
D. All of these.
75. When a CPA in business is pressured to become associated with
misleading information or to become associated with misleading
information through the actions of others, what kinds of threats might
arise?
A. Self-interest and self-review threats
B. Self-interest and intimidation threats
C. Familiarity and self-review threats
D. Self-review and advocacy threats
76. Circumstances that threaten the ability of a professional accountant in
business to perform duties with the appropriate degree of professional
competence and due care include the following, except:
A. Insufficient time for properly performing or completing the relevant
duties.
B. Incomplete, restricted or otherwise inadequate information for
performing the duties properly.
C. Sufficient experience, training and/or education.
D. Inadequate resources for the proper performance of the duties.
77. Examples of circumstances that may create self-interest threats
include, but are not limited to situations where the CPA in business or an
immediate or close family member (select the exception):
A. Holds a direct or indirect financial interest in the employing
organization and the value of that financial interest could be directly
affected by decisions made by said CPA
B. Is eligible for a profit related bonus and the value of that bonus is not
directly affected by decisions made by the said CPA
C. Holds, directly or indirectly, share options in the employing organization,
the value of which could be directly affected by decisions made by the said
CPA
D. May qualify for share options in the employing organization or
performance related bonuses if certain targets are achieved
78. A CPA in business or an immediate or close family member may be
offered an inducement or pressured to offer inducements. Inducements
may take various forms, including
A. Gifts and hospitality
B. Preferential treatment
C. Inappropriate appeals to friendship or loyalty.
D. Any of these
79. The term assurance team includes:
A. All professionals participating in the assurance engagement
B. All others within a firm who can directly influence the outcome of the
assurance engagement
C. In the case of an audit client, all those within a network firm who can
directly influence the outcome of the audit engagement
D. All of these.
80. The lead engagement partner is the partner responsible for signing
the report:
A. on the consolidated financial statements of the audit client.
B. on the financial statements, when no consolidated financial statements
are prepared.
C. in respect of any entity whose financial statements form part of the
consolidated financial statements and on which a separate stand-alone
report is issued, where relevant.
D. All of these.
81. The primary duty to enforce the provisions of RA 9298 and its IRR rests
with
a. PRC
b. BOA
c. PRC and BOA
d. AASC
82. The following are the objectives of the R.A. No. 9298, except
a. The standardization and regulation of accounting education
b. The examination for registration of certified public accountants
c. The development of virtuous, productive and well-rounded certified
public accountants
d. The supervision, control, and regulation of the practice of accountancy
in the Philippines
83. It is the area of practice of accountancy namely public accountancy,
commerce and industry, academe/education and government.
a. Scope of Services
b. Field
c. Area
d. Sector
84. A person who holds a valid Certificate of Registration and a valid
Professional Identification Card issued by the Commission upon
recommendation by the Board to those who have satisfactorily complied
with all the legal and procedural requirements for such issuance,
including in appropriate cases, having passed the CPA licensure
examination
a. Professional Accountant
c. Certified Public Accountant
b. Practitioner in Public Accounting
d. Board Passer
85. An organization engaged in the practice of public accountancy,
consisting of a sole proprietor, either alone or with one or more staff
member(s).
a. Individual CPA
b. Firm
c. Partnership
d. Sole Proprietor
86. A certified public accountant engaged in the practice of public
accountancy under his/her name, by himself/herself only or with one or
more staff member(s).
a. Individual CPA
b. Firm
c. Partnership
d. Sole Proprietor
87. A CPA is in public practice when he/she
a. Represents his/her employer before government agencies on tax and
other matters related to accounting.
b. Represents his/her clients before government agencies on tax and other
matters related to accounting.
c. Teaches accounting, auditing, management advisory services,
accounting aspect of finance, business law and other technically related
subjects.
d. Holds, or is appointed to, in an accounting professional group in
government or in a government-owned and/or controlled corporation
where decision making requires professional knowledge in the science of
accounting.
88. Any position in any business or company in the private sector which
requires supervising the recording of financial transactions, preparation
of financial statements, coordinating with the external auditors
for the audit of such financial statements and other related functions
shall be occupied only by a duly registered CPA. Provided (choose the
incorrect one)
a. That the business or company where the above position exists has a
paid-up capital of at least P5,000,000 and/or an annual revenue of at least
P 10,000,000.
b. The above provision shall apply only to persons to be employed after
the effectivity of the Implementing Rules and Regulations of RA 9298.
c. The above provision shall not result to deprivation of the employment of
incumbents to the position.
d. That the business or company where the above position exists has an
annual revenue of at least P5,000,000 and/or paid-up capital of at least P
10,000,000.
89. A meaningful experience shall be considered as satisfactory
compliance with the requirements of Section 28 of RA 9298 if it is earned in
(Choose the incorrect one)
a. Commerce and industry and shall include significant involvement in
general accounting, budgeting, tax administration, internal auditing,
liaison with external auditors, representing his/her employer before
government agencies on tax and matters related to accounting or any
other related functions.
b. Academe/education and shall include teaching for at least three (3)
trimesters or two (2) semesters subjects in either financial accounting,
business law and tax, auditing problems, auditing theory, financial
management and management services.
c. Government and shall include significant involvement in general
accounting, budgeting, tax administration, internal auditing, liaison with
the Commission on Audit or any other related functions.
d. Public practice and shall include at least two years as audit assistant
and at least one year as auditor in charge of audit engagement covering
full audit functions of significant clients.
90. Which of the following is defined as “the integrated national
professional organization of Certified Public Accountants accredited by
the Board and the Commission per PRC Accreditation No. 15 dated
October 2, 1975” by R.A. 9298?
a. Accredited National Professional Organization of Certified Public
Accountants or APO
b. Financial Reporting Standards Council or FRSC
c. Association of CPA’s in Parlor Operations or ACPAPO
d. Philippine Institute of Certified Public Accountant or PICPA
91. A study, appraisal, or review by the Board or its duly authorized
representatives, of the quality of audit of financial statements through a
review of the quality control measures instituted by an Individual CPA,
Firm or Partnership of CPAs engaged in the practice of public
accountancy to ascertain his/her/its compliance with prescribed
professional, ethical and technical standards of public practice.
a. Quality Review
c. Peer Review
b. Quality Control
d. Advancement and Quality Compliance Oversight
92. Documents showing the outline embodying topics and concepts of
major subjects prescribed in specific course of study to serve as the basis
for test questions in the CPA licensure examinations.
a. Syllabus
c. Candidates’ Body of Knowledge (CBOK)
b. Curriculum
d. Syllabi
93. The Professional Regulatory Board of Accountancy of
a. a chairman and 6 members
b. a chairman and 6 members appointed by PRC
c. a chairman and 6 members appointed by the President of the
Philippines
d. 6 members of Independent Auditing Firms
94. A member of the BOA shall, at the time of his/her appointment,
possess the following qualifications, except
a. Must be a natural-born citizen and resident of the Philippines.
b. Must be a duly registered CPA with more than ten (10) years of work
experience in any scope
of practice of accountancy.
c. Must be of good moral character and must not have been convicted of
crimes involving moral turpitude.
d. Must not be a director or officer of the APO at the time of his/her
appointment.
95. Which statement is incorrect regarding the term of office of the
chairman and the members of the Board of Accountancy (BOA)?
a. The Chairman and members of the Board shall hold office for a term of
three years.
b. No person who has served two (2) successive complete terms shall be
eligible for reappointment until the lapse of one (1) year.
c. A person may serve the BOA for not more than twelve years.
d. A member of the BOA may continuously serve office for more than nine
years.
96. The Commission upon the recommendation of the Board shall within
ninety (90) days from the effectivity of the IRR, create an accounting
standard setting body to be known as the
a. Accounting Standards Council
b. Financial Reporting Standards Council
c. Financial Reporting Standards Committee
d. Accounting Standards Committee
97. The Commission upon the recommendation of the Board shall within
ninety (90) days from the effectivity of the IRR, create an auditing standard
setting body to be known as the
a. Auditing, Assurance and Practices Council
b. Auditing and Assurance Standards Council
c. Auditing and Assurance Standards Committee
d. Auditing Standards and Practices Committee
98. The creation of FRSC and AASC is intended to assist the BOA in
carrying out its function to
a. To monitor the conditions affecting the practice of accountancy and
adopt such measures, rules and regulations and best practices as may be
deemed proper for the enhancement and maintenance of high
professional, ethical, accounting and auditing standards.
b. To supervise the registration, licensure and practice of accountancy in
the Philippines.
c. To prescribe and adopt the rules and regulations necessary for carrying
out the provisions of RA 9298.
d. To prepare, adopt, issue or amend the syllabi of the subjects for
examinations.n
99. The PRC upon the recommendation of the Board of Accountancy (BOA)
shall create a council to assist the BOA in carrying out its powers and
functions and in attaining its objective of continuously upgrading the
accountancy education in the Philippines to make the Filipino CPA
globally competitive. This council is to be known as the
a. CPAs in Education Council
b. Education Technical Council ?
c. Council of CPAs in Education
d. CPAs in the Academe Council
100. Which of the following does not fall under the admission requirements
for CPA examinations?
a. A Filipino citizen
b. Is of good moral character
c. At least twenty one years of age - at least 18 to 21 y/o
d. Has not been convicted of any criminal offense involving moral
turpitude
101. Under foreign reciprocity, special/temporary permit may be issued by
the Board subject to the approval of the Commission and payment of the
fees the latter has been prescribed and charged thereof to the following
persons except
a. A foreign CPA called for consultation or for a specific purpose which, in
the judgment of the Board, is essential for the development of the country.
/
b. A foreign CPA engaged as a professor, lecturer or critic in fields essential
to accountancy education in the Philippines /
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 advancement of accountancy in the Philippines /
d. A foreign certified public accountant who visits the Philippines to study
additional learning in the field of computer system and design. (UNDER
ART. 4 SEC. 35 OF PHILIPPINE ACCOUNTANCY ACT OF 2004)
102. The following were the ratings of examinees who took the easy but
tricky CPA Board Examination on May 2013.
• Examinee 1 - All subjects garnered a rating of 95%. X PASSED
• Examinee 2 - All subjects garnered a rating of 75%. X PASSED
• Examinee 3 - One subject garnered a rating of 81% and the other six
garnered a rating of 74%. X PASSED
• Examinee 4 - One subject garnered a rating of 64% and the other six
garnered a rating of 85%. X FAIL
• Examinee 5 - Three subjects garnered a rating of 75% and the other four
garnered a rating of
74%. X PASSED
• Examinee 6 - All subjects garnered a rating of 74%. X FAIL
• Examinee 7 - Four subjects garnered a rating of 95%, one with 73% and
other 2 with 64%. X
• Examinee 8 - Three subjects garnered a rating of 95%, one with 74% and
other three with 73%. PASSED
Of the ratings presented above, how many examinees obtain a conditional
status in the Board Exam?
a. 4
b. 2
c. 3
d. 1?
103. A CPA certificate is evidence of
e. Independence as a professional.
a. Basic competence at the time of certification.
b. Membership in the accredited association.
c. Completion of continuing professional education program.
104. The Board shall submit to the Commission the ratings obtained by
each candidate within
a. 2 calendar days after the examination
b. 5 calendar days after the examination
c. 10 calendar days after the examination
d. 15 calendar days after the examination
105. Which of the following statement is incorrect in accordance with Sec
18 Failing Candidates to Take Refresher Course?
a. any candidate who fails two complete CPA Board Examinations shall
take the Refresher Course /
b. must be enrolled in and completed at least twenty four units of subjects
given in the licensure examination /
c. the examination in which the candidate was conditioned together with
the removal examination on the subject in which he/she failed shall be
counted as two complete examinations /
d. the examination in which the candidate was conditioned together with
the removal examination on the subject in which he/she failed shall be
counted as 1 complete examination
106. Which of the following is not one of the grounds for proceedings
against a CPA?
a. Gross negligence or incompetence in the practice of his profession.
b. Engaging in public practice while being employed in a private
enterprise.
c. Insanity.
d. Immoral or dishonorable conduct.
107. A certificate of accreditation shall be issued to certified public
accountants 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 how many years of
meaningful experience in any of the areas of public practice?
a. One
b. Two
c. Three
d. Four
108. It 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. Quality Review
c. Continuing Professional Education
d. Continuous Professional Education
109. Which statement is correct regarding CPE requirements for renewal of
professional license?
a. The total CPE credit units required for CPAs shall be sixty (60) units for
three (3) years, provided that a minimum of twenty (20) credit units shall be
earned in each year.
b. A registered professional shall be permanently exempted from CPE
requirements upon reaching the age of 60 years old.
c. A registered professional who is working abroad shall be temporarily
exempted from compliance with CPE requirement during his/her stay
abroad, provided that he/she is has been out of the country for at least
one year immediately prior to the date of renewal.
d. Those who failed to renew professional licenses for a period of five (5)
continuous years from initial registration, or from last renewal shall be
declared delinquent.
110. A registered professional who is working or practicing his/her
profession or furthering his/her studies abroad shall be temporarily
exempted from compliance with CPE requirement during the period of
his/her stay abroad, provided that he/she has been out of the country for
at least
a. one year immediately prior to the date of renewal
b. two years immediately prior to the date of renewal
c. three years immediately prior to the date of renewal
d. five years immediately prior to the date of renewal
111. A registered professional shall be permanently exempted from CPE
requirements upon reaching the age of
a. 55 years old
b. 60 years old
c. 65 years old
d. 70 years old
112. Who is not permitted by law to practice accountancy?
a. A partnership of CPAs
b. An individual CPA practitioner
c. A corporation whose stockholders are all
CPAs
d. A partnership of CPAs with some non-CPA staff
113. 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
114. Below are the names of three CPA firms and pertinent facts relative to
each firm. Unless otherwise indicated, the individuals named are CPAs
and partners, and there are no other partners. Which firm name and
related facts indicates a violation of the IRR of RA 9298?
a. Joyce, Ara and Angela, CPAs (Joyce died about 10 years ago, Ara and
Angela are continuing the firm)
b. Lupin and Fujico, CPAs ( the name of Goymon a third active partner is
omitted in the firm name)
c. Hugo and Pugo, CPAs (Hugo died 25 months ago, Pugo is continuing the
firm as a sole proprietor)
d. Bubu and Bibi, CPAs (Bibi died 3 years ago; Bobot was admitted into the
partnership 2 months after Bibi's death.)
115. Any person who shall violate any of the provisions of RA 9298 or any of
its implementing rulesand regulations as promulgated by the Board
subject to the approval of the Commission, shall, uponconviction, be
punished by
a. A fine of not less than fifty thousand pesos (P50,000.00) or by
imprisonment for a period not exceeding two (2) years or both.
b. A fine of not less than one hundred thousand pesos (P100,000.00) or by
imprisonment for a period not exceeding two (2) years or both.
c. A fine of not less than fifty thousand pesos (P50,000.00) or by
imprisonment for a period not exceeding three (3) years or both.
d. A fine of not less than one hundred thousand pesos (P100,000.00) or by
imprisonment for a period not exceeding three (3) years or both.
116. Those charged with the governance of an entity, regardless of their
title, which may vary from country to country.
A. Director or officer
c. Board of directors
B. Governors
d. Committee on sustainability
117. The communication to the public of information as to the services or
skills provided by CPAs in public practice with a view to procuring
professional business.
A. Publicity
B. Advertising
C. Solicitation
D. Information
118. A CPA in public practice currently holding an audit appointment or
carrying out accounting, taxation, consulting or similar professional
services for a client.
A. Existing accountant
C. Successor auditor
B. Employed professional accountant
D. Professional accountant
119. A receiving accountant may accept referrals for audit, accounting,
taxation, consulting or similar engagements, from which of the following
parties?
A. The existing accountant.
C. Either a or b.
B. The client of the existing accountant.
D. Neither a nor
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6SIrI1ir-hz1LtP9pbVw/edit?usp=drive_web&ouid=103204630701011384931
120. The term related entity is defined under the Code of Ethics to include
any of the following relationships with the client, except:
A. An entity that has direct or indirect control over the client provided the
client is material to such entity.
B. An entity over which the client has direct or indirect control.
C. An entity wi777th a direct financial interest in the client even though
such entity has no significant influence over the client provided the
interest in the client is material to such entity.
D. An entity which is under common control with the client (referred to as a
“sister entity”) provided the sister entity and the client are both material to
the entity that controls both the client and
sister entity.