Check your ITRs and audited FS before filing
- Maria Teresita Dimaculangan
- 8 hours ago
- 3 min read
THE recent extension of filing deadlines by the Bureau of Internal Revenue and the Securities and Exchange Commission provides a welcome opportunity for businesses to pause and reflect. The annual income tax return deadline has been moved to May 15, 2026, and that for the submission of audited financial statements to June 15, 2026, and this should not be viewed as a mere extension of compliance but rather as an opportunity to strengthen financial accountability.
For many entrepreneurs, particularly those managing small and medium enterprises, the preparation and filing of financial statements and tax returns often become routine processes. Documents are prepared, reviewed briefly, signed and submitted. However, beneath this routine lies a fundamental principle that is sometimes overlooked: the ultimate responsibility for the accuracy and completeness of these reports rests with management, not the auditor.
This responsibility is clearly embodied in the Statement of Management’s Responsibility. Far from being a procedural requirement, it is a formal declaration that the financial statements fairly present the company’s financial position in accordance with applicable standards and regulations. While auditors provide an independent opinion, they do not own the numbers. They rely on the data and representations provided by management.
Failure to carefully review financial statements and tax returns before filing exposes businesses to significant risks. Errors in reporting, inconsistencies between financial statements and tax returns and incomplete disclosures may not only result in regulatory scrutiny but also lead to penalties and reputational damage. Regulatory bodies such as the BIR and SEC routinely cross-check submitted documents and any discrepancy may trigger further investigation.
Another common challenge arises from delays in providing necessary documents to auditors. Financial statements cannot be completed without accurate and timely submission of trial balances, schedules, and supporting documents. When these are delayed, the entire audit process is affected, increasing the likelihood of late filings and corresponding penalties. In many cases, the bottleneck lies not with the auditors but within the organization itself.
Equally concerning is the misconception that tax obligations can be influenced by preference rather than determined by actual financial performance. Some business owners attempt to dictate the amount of tax to be reported, disregarding the principles governing tax computation. Such practices undermine compliance and may lead to serious consequences, including assessments, surcharges and possible legal implications.
A thoughtful review of financial statements and tax returns need not require deep technical expertise. Rather, it calls for a sense of ownership and a willingness to understand the financial position of the business. Management should be able to reconcile reported figures with internal records, ensure that disclosures are complete and consistent and confirm that tax computations align with reported results. Open communication with auditors is essential and technical matters should be clarified in a manner that is understandable to decision-makers.
Beyond compliance, this process reflects stewardship. It demonstrates that management exercises due diligence in overseeing the financial affairs of the organization. It also provides valuable insights into business performance, enabling leaders to identify risks, improve operations and make informed strategic decisions.
The extension of filing deadlines should, therefore, be seen as an opportunity to reinforce good governance practices. By taking the time to review and understand financial reports, businesses not only ensure compliance but also build credibility with regulators, investors, and other stakeholders.
Ultimately, the act of signing financial statements and tax returns carries weight. It signifies accountability, transparency and integrity. Business owners and management must move beyond treating compliance as a routine obligation and instead embrace it as a critical aspect of leadership.
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Maria Teresita Zúñiga-Dimaculangan serves as a member of the Professional Regulation Commission Board of Accountancy and chairperson for accountancy under the Philippine Qualifications Framework–Coordinating Council.
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