Accounting in the Philippines – Raising the Standards

The Philippines is a country that is progressing and expanding and the standards are being raised in every department of the business sector to reflect this growth. Indeed, 2015 saw many changes in the accounting industry that indicate that the Board of Accountancy (BoA) is determined to do everything it can in order to increase the quality of service in this field.

It revised the syllabus for the Certified Public Accountant (CPA) exams by overhauling the subjects in order to ensure that they meet global standards and that they are more current and relevant. There was a reduction in the number of examination subjects from seven to six by amalgamating some of the previous subjects and then adding a new one entitled the Regulatory Framework for Business Transactions, and there will be a shift towards an outcome-based education with a focus on effective communication.

It has also implemented new rules on accreditation, as well as in the preparation of financial statements, by tightening up the procedures and enforcing stricter guidelines. It will also soon put in place changes in the Continuing Professional Development (CPD) which are aimed at improving the quality of certified accountants in the country. While certain rules may prove costly and burdensome to some, they are necessary in order to improve the quality control in the industry.

The major changes include the increase, year-on-year, in the number of CPD units that have to be completed, from the current number of 60 to 80 for the end of 2016, then 100 for 2017 and 120 for 2018; the establishment of clearer rules on how to secure CPD credits for self-directed learning activities, while also encouraging more online courses to be made available; a more efficient and restructured monitoring of the CPD units by using the BoA’s IT tracking system, and the firm shift of the categories studied in order to align them with the International Education Standards.

There are also a few other less important changes, and it all goes to show the willingness and single-mindedness of the BoA to take whatever steps are necessary in order to improve the standards within the industry and the quality of CPAs. What should be noted, though, is that, while this is a good thing, there may be a downside in that it may make it very difficult for sole practitioners to continue working independently due to the costly requirements, leaving the field open only to the big firms.

However, the end result should be that there will be a better regulation of the accountancy profession, which will bring about more trust from the general public, as well as the international business community at large.

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