03212025Q

What is the primary purpose of accounting as defined by the Philippine Institute of Certified Public Accountants (PICPA)?

• To record financial transactions for taxation purposes

• To provide financial information for decision-making

• To ensure businesses pay the correct amount of taxes

• To monitor cash inflows and outflows

The Accountancy Law of 1923 was enacted to:

• Establish taxation policies for businesses in the Philippines

• Provide a legal basis for accounting practices in government institutions

• Regulate the accounting profession and CPA licensure in the Philippines

• Introduce computerized accounting systems in the country

What is the main difference between PFRS and IFRS?

• PFRS is used only for public companies, while IFRS is for all businesses

• PFRS has additional guidelines specific to Philippine economic conditions

• IFRS applies only to non-profit organizations, while PFRS is for businesses

• There is no difference; they are identical in application

What is the primary role of the Board of Accountancy (BOA) in the Philippines?

• To manage tax compliance of businesses

• To oversee financial reporting for government agencies

• To regulate and monitor the CPA licensure process

• To create financial policies for corporations

Which of the following branches of accounting focuses on examining financial records for fraud and legal cases?

• Financial Accounting

• Managerial Accounting

• Forensic Accounting

• Government Accounting

The Mutual Recognition Arrangement (MRA) for Accountancy Services under ASEAN 2015 allows:

• CPAs from the Philippines to work in any ASEAN country without additional certification

• Financial reporting standards to be fully merged among ASEAN nations

• The automatic recognition of business models across ASEAN nations

• Government financial audits to be conducted by foreign accountants

Which of the following best represents the historical evolution of accounting in the Philippines?

• Spanish period → American period → ASEAN integration

• Taxation → Bookkeeping → Digital accounting

• Manual record-keeping → GAAP adoption → IFRS integration

• Community Treasury → PICPA establishment → CPA Licensure Exam

A Filipino CPA wants to work in Singapore. What must they do under the ASEAN Mutual Recognition Arrangement (MRA)?

• Retake the CPA licensure exam in Singapore

• Apply for recognition of qualifications and meet additional local requirements

• Obtain a separate financial management certificate

• Join the Singaporean Institute of Accountants as a student

A company follows the Going Concern Assumption in financial reporting. What does this imply?

• The company is guaranteed to make profits

• The business intends to continue operations indefinitely

• The company is preparing for liquidation

• The financial records are not audited

Why do businesses apply the Accrual Concept instead of recording transactions only when cash is received?

• To comply with tax regulations

• To provide a more accurate picture of financial performance

• To match transactions to government audits

• To ensure better payroll management