AMONG the recent and crucial developments in the practice of the accountancy profession in the Philippines is the implementation of the Quality Assurance Review (QAR) for CPAs in Public Practice.
CPAs are certified public accountants.
Since last year, the Professional Regulation Commission (PRC) Board of Accountancy has been actively pursuing continuous education in the hope that practitioners appreciate the objective of quality audit work.
As a declaration of policy, Section 2 of Republic Act (RA) 9298, known as the "Philippine Accountancy Act of 2004," states: "The State recognizes the importance of accountants in nation-building and development. Hence, it shall develop and nurture competent, virtuous, productive and well-rounded professional accountants whose standard of practice and service shall be excellent, qualitative, world class and globally competitive through inviolable, honest, effective and credible licensure examinations, and through regulatory measures, programs and activities that foster their professional growth and development."
CPAs teaching in colleges and universities offering four- to five-year BS Accountancy Programs are expected to have developed competence and embedded ethical values to their students, and be able to provide quality, world-class professionals who will further develop their craft through continuous professional development programs.
In line with the near implementation of the QAR program, I cannot help but wonder if the Board of Accountancy has also considered establishing quality-related programs for our colleagues in the commerce and industry, government and education sectors.
The scope of practice of CPAs in the Philippines are enumerated in Section 4 of RA 9298. "The practice of accountancy shall include, but not limited to, the following:
(a) Practice of public accountancy — shall constitute a person, be it in his/her individual capacity, or as a staff member in an accounting or auditing firm, holding out himself/herself as one skilled in the knowledge, science and practice of accounting, and as a qualified person to render professional services as a certified public accountant; or offering or rendering, or both or more than one client on a fee basis or otherwise, services as such as the audit or verification of financial transaction and accounting records; or the preparation, signing or certification for clients of reports of audit, balance sheet, and other financial, accounting and related schedules, exhibits, statement of 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 purposes; or to design, installation and revision of accounting system; or the preparation of income tax returns when related to accounting procedures; or when he/she represent clients before government agencies on tax and other matters relating to accounting or render professional assistance in matters relating to accounting procedures and the recording and presentation of financial facts or data.
(b) Practice in commerce and industry — shall constitute a person involved in decision-making requiring professional knowledge in the science of accounting, or when such employment or position requires that the holder thereof must be a certified public accountant.
(c) Practice in education/academe — shall constitute in a person in an educational institution, which involve teaching of accounting, auditing, management advisory services, finance, business law, taxation and other technically related subject: Provided, That members of the Integrated Bar of the Philippines may be allowed to teach business law and taxation subjects.
(d) Practice in government — shall constitute in a person who holds, or is appointed to, a position in an accounting professional group in government or in a government-owned and/or -controlled corporation, including those performing proprietary functions, where decision-making requires professional knowledge in the science of accounting, or where a civil service eligibility as a certified public accountant is a prerequisite."
Back in college, I would always hear my professors say: "The work of the auditor starts when the work of the accountant ends." I believe the objective of quality audit work would always depend on the quality of information made available to auditors by the general accountants in coordination with the internal auditors of companies being audited, if any.
It is the dream of every public practitioner engaged in assurance services to be able to perform quality audit work that stems from quality financial statements prepared by our colleagues in the commerce and industry sector.
Financial statements and reports can only be prepared by accountants that have gone through quality accounting education and skills training mentored by industry-immersed CPAs from the academe.
The quality of the financial statements prepared also depend on clear and simplified regulations, and standards formulated and with advisory or guidance by CPAs in government agencies such as the Bureau of Internal Revenue, Securities and Exchange Commission, and the Insurance Commission.
This is the reason why I believe a set of quality practice standards must be put in place not just for those in public practice but across all sectors of the profession.
Because at the end of the day, we only have one profession. Auditors need not feel burdened by the implementation of the QAR as we are assured that our peers from the other sectors are equally monitored by the PRC Board of Accountancy in terms of quality performance in their respective line of work.
Because quality matters.
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Merilyn Gomez-Cheng, CPA, MBA is the managing owner of Merilyn Gomez-Cheng Accounting Office and a member of Acpapp. The views expressed herein do not necessarily reflect the opinion of these institutions.
