GOVERNING THE PRACTICE OF PUBLIC ACCOUNTANCY, PROVIDING FOR THE REGISTRATION OF FIRMS AND PARTNERSHIP OF CPAS, INCLUDING PARTNERS AND STAFF MEMBERS THEREOF: AND PRESCRIBING PENA…

WHEREAS, Section 27 of Presidential Decree No. 692 provides that
firms or partnerships of certified public accountants, including
partners and staff members thereof, shall register with the Professional
Regulation Commission and the Board of Accountancy, such registration
to be renewed every three years;

WHEREAS, said Section 27 of PD 692 further provides further provides
that, subject to the approval of the Professional Regulation Commission,
the Board of Accountancy shall promulgate rules and regulations for the
implementation of registration requirements including the fees and the
penalties for violation thereof;

WHEREAS, Section 5, par. (c) of PD 692 provides that one of the
functions of the Board of Accountancy is to look from time to time into
the conditions affecting the practice of the accountancy profession and
whenever necessary, adopt such measures as may be deemed proper for the
enhancement and the maintenance of high professional, ethical, and
technical standards;

WHEREAS, Section 6, par. (a) of Presidential Decree No. 223 vests
upon the Board the power to adopt such measures as may be deemed proper
for the enhancement of the profession or occupation and/or the
maintenance of high professional, ethical, and technical standards;

WHEREAS, the registration of firms and partnership of CPAs engaged in
public accountancy, including partners and staff members thereof, will
enable the Board of Accountancy to more effectively formulate and
implement rules and regulations for the enhancement and maintenance of
high professional, ethical, and technical standards of the accounting
profession;

WHEREAS, there is a need to protect the public against fraud,
deception, or the consequences of ignorance and incapacity in the
practice of public accountancy;

WHEREAS, registration will help the Professional Regulation
Commission and the Board of Accountancy to indentify and impose
corresponding sanctions and penalties on firms and partnerships,
including partners and staff members thereof, who are not authorized by
law to practice public accountancy, or who violate the rules and
regulations of the Board of Accountancy, or fail to adhere to the
professional, ethical, and technical standards of the accounting
profession;

NOW THEREFORE, be it resolved, as it is hereby resolved, to require
the registration of firms and partnerships of certified public
accountants, including partners and staff members thereof, with the
Board of Accountancy and the Professional Regulation Commission, in
accordance with Section 27 of PD No. 692 and the implementing rules and
regulations set forth hereunder;

BE IT FURTHER RESOLVED, to promulgate the following rules and
regulations implementing Section 27, PD 692, governing the practice of
public accountancy, providing for the registration of firms and
partnerships of CPAs, including partners and staff members thereof, and
prescribing penalties for violations hereof.

ARTICLE I
Definition of Terms

SECTION 1.       When used in these implementing rules and regulations, the following terms have the meanings indicated:

(a)     Practice of public accountancy
means the offering or rendering, or both, to more than one client on a
fee basis or otherwise, services such as the audit or verification of
financial transactions and accounting records; the preparation, signing
of reports of audit of financial statements and other financial,
accounting, and related schedules, analyses, exhibits, or reports which
are to be used for publication or for credit purposes, or to be filed
with a court or government agency, or to be used for any other purpose;
the installation and revision of accounting system, the preparation of
income tax returns when related to accounting procedures; or the
representation of clients before government agencies on tax matters
related to accounting or the rendition of professional assistance in
matters relating to accounting procedures and the recording and
presentation of financial facts or date.

(b)     Board means the Board of Accountancy established under Presidential Decree No. 692.

(c)     Commission means the Professional Regulation Commission established under Presidential Decree No. 223.

(d)     Firm means an organization
engaged in the practice of public accountancy, consisting of a sole
practitioner and/or one or more staff members.

(e)     Partnership means a professional
partnership engaged in the practice of public accountancy whether or not
duly registered as such with the Securities and Exchange Commission.

(f)      Staffmember
means a member of a firm or partnership engaged in the practice of
public accountancy as defined in Sec. 1(a) below the rank of partner or
sole practitioner.

(g)     Certified Public Accountant (CPA)
means a person who holds a valid certificate of registration issued by
the Board of Accountancy to those who have satisfactorily passed the CPA
licensure examination and complied with other requirements of the
Board.

(h)     Certificate of Registration means
a statement in writing and under seal, issued by the Professional
Regulation Commission upon recommendation of the Board of Accountancy,
attesting that a firm or partnership of CPAs, including the partners and
staff members thereof, is duly registered to practice accountancy in
the Philippines.

( i)      Quality Review means a study,
appraisal, or review by the Board of Accountancy or its duly authorized
representatives, of one or more aspects of the professional work of a
firm or partnership engaged in the practice of public accountancy.

ARTICLE II
Registration

SECTION 2.       Within six (6) months from the effective
date of these rules and regulations, firms and partnerships of CPAs,
including sole practitioner/partners and staff members thereof, already
engaged in the practice of public accountancy, shall register with the
Board and Commission in the manner provided for in Section 4 hereof.

SECTION 3.       Firms and partnerships of CPAs organized
after the effective date of these rules and regulations shall, including
the sole practitioner/partners and staff members thereof, register with
the Board and the Commission in the manner provided for in Section 4
hereof, and shall not commence the practice of public accountancy until a
valid certificate of registration has been issued in accordance with
Section 6 hereof.

SECTION 4.       The application for registration shall be
accomplished in the form prescribed by the Board, in triplicate, and
duly signed by the sole practitioner or authorized partner of the
applicant partnership.  The application form for registration shall
contain such information as may be required by the Board including, but
not limited to, the following matters:

(a)     Name of firm or partnership;

(b)     Full name(s) of sole practitioner or partner(s) together with the number of their CPA certificates;

(c)     Certificate of registration with the Securities and Exchange Commission, if any;

(d)     Complete address of principal office and branch( es) or sub-Office(s), if any;

(e)     Correspondent relationship with foreign CPA firms, if any;

(f)      Staff member(s) who are CPAs together with the number of their CPA certificate.

SECTION 5.       Any change with respect to the matter
enumerated in Section 4 should be reported in writing to the Board, copy
furnished the Commission, within sixty (60) days from such change.
Renewals of registration shall indicate changes that have taken place
since the last registration.

SECTION 6.       The Board shall duly authenticate all
applications for registration received in proper form, and after having
passed upon such applications shall, not later than thirty (30) days
after the application is filed, recommend approval or denial of the
application to the Commission.

SECTION 7.       No firm or partnership of CPAs duly
registered under these rules and regulations shall have as its sole
practitioner or partner any foreign CPA unless he qualifies to practice
in the Philippines under the foreign reciprocity provision of Section
18, PD No. 692, or other relevant laws.

SECTION 8.       The Commission shall, upon favorable
recommendation of the Board, issue to the applicant the corresponding
certificate of registration to practice public accountancy.  Unless
sooner revoked, cancelled or withdrawn, said certificate of registration
shall be valid for three years; and shall be renewable every three
years thereafter, upon payment of fees in accordance with Section 16,
hereof.

ARTICLE III
Voluntary Withdrawal of Registration Reinstatement

SECTION 9.       Firms or partnerships of CPAs, including
sole practitioner/partners and staff members duly registered to engage
in the practice of public accountancy may voluntarily withdraw their
registration by filing with the Board a petition in writing stating the
reason(s) therefor.  The petition should be duly authenticated and
signed by all the partners of the partnership, or the sole practitioner
of the firm, or the individual partner(s) or staff member(s) requesting
voluntary withdrawal.

SECTION 10.    At the expense of the petitioners, the Board
shall publish or cause the publication of the request for withdrawal of
registration once in a newspaper of general circulation in the principal
place of business of the firm or partnership.  If there is no
opposition to the petition, the Board shall recommend approval thereof
to the Commission.  Upon approval, the petitioner’s name shall be
removed from the rolls of duly registered partnerships and firms,
including partners and staff members thereof, and the petitioner shall
be notified in writing of the withdrawal of the registration.

SECTION 11.    Upon recipt from the Board of written notice
of the withdrawal of registration, the petitioner shall cease to engage
in the practice of public accountancy.

SECTION 12.    The Commission shall publish the list of
firms or partnerships, including partners or staff members whose
registration has been cancelled or withdrawn and shall furnish copies of
the list to the pertinent government regulatory agencies.

SECTION 13.    A firm or partnership or any of its partners
which has voluntarily withdrawn its registration, may register anew by
filing an application in accordance with Section 4 hereof.

ARTICLE IV
Quality Reviews

SECTION 14.    The Board may require on a uniform basis as a
condition to registration, that sole practitioner and partnerships
undergo quality reviews in such manner as the Board may specify:
Provided, however, That any such requirement (1) shall be promulgated
reasonably in advance of the time when it is first required to be met,
and (2) shall include reasonable provision for compliance by a
registrant showing that it has undergone a satisfactory quality review
performed for other purposes which is substantially equivalent to
quality reviews and shall be made applicable to all firms and
partnerships without discrimination.

ARTICLE V
Dissolution of Firm or Partnership of CPAs

SECTION 15.    The dissolution of a firm or partnership of
CPAs shall be reported to the Board of Accountancy by the sole
practitioner or managing partner thereof not later than thirty (30) days
from the date of such dissolution.  The report shall be made in the
form of an affidavit, or by furnishing the Board with a certified copy
of the dissolution papers filed with the Securities and Exchange
Commission. Failure to notify the Board of such dissolution shall
subject the principal or managing partner(s) of the firm or partnership
to the penalties provided herein.

ARTICLE VI
Fees and Penalties

SECTION 16.    Application for initial registration, renewal and request for reinstatement, shall be accompanied by a fee of P300.00.

SECTION 17.    Subject to review by the Commission and
depending on the gravity of the offense(s), the Board shall suspend or
revoke the CPA certificates of a sole practitioner, partner or staff
member: Provided, that if the act or acts committed constitutes a
criminal offense punishable under Section 22, PD 692, and other existing
penal laws, the party or parties responsible shall be proceeded against
criminally, independent of any action herein provided.

SECTION 18.    Violations of these implementing rules and
regulations shall include, but shall not be limited to the following
acts by a firm or partnership, its sole practitioner, partners, or staff
members:

(a)     Engaging in public accounting practice without first registering with the Board and the Commission;

(b)     Continuing to engage in the practice of public accountancy after the expiration of the registration;

(c)     Continue to engage in the practice of public accountancy
after the suspension, revocation, or withdrawal of the registration;

(d)     Giving any false information, data, statistics, reports or
other statement which tend to mislead obstruct, or secure the
registration of a firm or partnership under these rules and regulations;

(e)     Giving any misrepresentation to the effect that registration was secured when in truth and in fact, it was not secured;

(f)      Failure/refusal to undergo quality reviews specified in Section 14, hereof;

(g)     Failure to comply with the requirements provided under Section 4, hereof.

ARTICLE VII
Remission of Fines or Lifting of Sanctions Imposed

SECTION 19.    Subject to the approval of the Professional
Regulation Commission, the Board may, for justifiable reasons, lift
sanctions imposed on any firm, partnership, its partner and staff
members.

ARTICLE VIII
Effectivity

SECTION 20.    These rules and regulations implementing the
registration of firms and partnerships, including partners and staff
members thereof, shall, upon approval by the Commission, take effect
fifteen days after publication in the Official Gazette.

Adopted: 19 Feb. 1990 .

(SGD.) HERMOGENES P. POBRE        Chairman	(SGD.) LUPO S. RAMOS Vice-Chairman
(SGD.) PURIFICACION A. UNTALAN   Member	(SGD.) GUILLERMO A. CRUZ Member
(SGD.) JESUS A. CASIÑO Member	(SGD.) ALEJANDRO C. REYES Member
(SGD.) EDUARDO B. DE GUIA Member

Approved as part of the rules and regulations governing the practice
of the accountancy profession, this 19th day of February, 1990 in the
City of Manila .

(SGD.) JULIO B. FRANCIA, JR.              Commissioner	(SGD.) ROSALINDA A. VICENTE Associate Commissioner
(SGD.) MARIANO A. MENDIETA Associate Commissioner