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WorksheetsThe Accounting Profession
Total questions: 54
Worksheet time: 27mins
The body authorized by law to promulgate rules and regulations affecting the practice of the accountancy profession in the Philippines.
ACCOUNTING STANDARDS COUNCIL
BOARD OF ACCOUNTANCY
PROFESSIONAL REGULATION COMMISSION
FINANCIAL REPORTING STANDARDS COUNCIL
Accounting is a service activity and its function is to provide quantitative information, primarily financial in nature, about economic entities, that is intended to be useful in making economic decisions. This accounting definition is given by_________.
ACCOUNTING STANDARDS COUNCIL
BOARD OF ACCOUNTANCY
Financial Reporting Standards Council
PROFESSIONAL REGULATION COMMISSION
The law regulating the practice of accountancy in the Philippines.
R.A No. 9892
PHILIPPINE ACCOUNTANT ACT OF 2004
PHILIPPINE ACCOUNTANCY ACT OF 2004
This accounting process is the recognition or nonrecognition of business activities as accountable events.
MEASURING
INTERPRETING
IDENTIFYING
COMMUNICATING
The assigning of peso amounts to the accountable events.
MEASURING
IDENTIFYING
INTERPRETING
COMMUNICATING
The most common financial attribute used in measuring financial information.
PRESENT VALUE
CURRENT COST
HISTORICAL COST
FAIR VALUE
The standards-setting body in the Philippines at the present time.
ACCOUNTING STANDARDS COUNCIL
FINANCIAL REPORTING STANDARDS COUNCIL
BOARD OF ACCOUNTANCY
PROFESSIONAL REGULATION COMMISSION
Single practitioners for the practice of public accountancy shall be registered CPAs in the Philippines.
TRUE
FALSE
The overall objective of accounting is to provide qualitative information about an entity that is useful in making economic decision.
TRUE
FALSE
The communicating process of accounting includes recording, classifying, summarizing and interpreting.
TRUE
FALSE
Accounting is a service activity.
TRUE
FALSE
The three main areas in the practice of the accountancy profession are Public accounting, private accounting, and managerial accounting.
TRUE
FALSE
An event is accountable when it has an effect on asset, liability, or equity.
TRUE
FALSE
Accounting is an information system.
TRUE
FALSE
The subject matter of accounting is the measurement of economic resources and obligations.
TRUE
FALSE
Accounting is a universal language of business.
TRUE
FALSE
Partners of partnerships formed for the practice of public accountancy shall be registered CPAs in the Philippines.
TRUE
FALSE
Accounting is an exact science rather than an art.
TRUE
FALSE
Only economic activities are emphasized and recognized in accounting.
TRUE
FALSE
The Securities and Exchange Commission can register any corporation organized for the practice of public accountancy.
TRUE
FALSE
Accounting information is both quantitative and qualitative.
TRUE
FALSE
Accounting information is financial in nature.
TRUE
FALSE
Accounting information is useful in decision making.
TRUE
FALSE
Sociological and psychological matters are quantifiable.
TRUE
FALSE
CPAs are licensed by PICPA.
TRUE
FALSE
GAAP is an abbreviation for “Generally accepted auditing principles”.
TRUE
FALSE
All of the following are represented in FRSC, except
Commission on Audit
Board of Accountancy
Department of Budget and Management
Securities and Exchange Commission
The Philippine Financial Reporting Standards collectively include
PFRS corresponding to IFRS
All of these are included in Philippine Financial Reporting Standards.
PAS corresponding to IAS
Philippine Interpretations corresponding to IFRIC and SIC Interpretations and Interpretations developed by PIC.
Accounting standard-setting has been characterized as
A legal process
Pure deductive reasoning
Using scientific method
A political process
What is the primary service of CPAs in public practice?
Auditing
Taxation
Managerial accounting
Controllership
Accountants employed in entities in various capacity as accounting staff, chief accountant or controller are said to be engaged in
Government accounting
Private accounting
Public accounting
Financial accounting
It is the area of the accountancy profession that encompasses the process of analyzing, classifying, summarizing and communicating all transactions involving the receipt and disposition of government funds and property and interpreting the results thereof.
Internal auditing
Government accounting
External auditing
Private auditing
The Continuing Professional Development is required for
Accreditation to practice the accountancy profession.
Renewal of CPA license.
Both renewal of CPA license and accreditation to practice the accountancy profession.
Neither renewal of CPA license nor accreditation to practice the accountancy profession.
A CPA shall be permanently exempted from renewal of CPA license.
When studying abroad
When working abroad
When practicing the profession abroad
At the age of 65 years
The International Accounting Standards Board was formed
To enforce IFRS in foreign countries
To develop a single set of high quality IFRS
To establish accounting standards for multinational entities
To develop accounting standards for countries that do not have their own standard-setting bodies.
The International Accounting Standards Board
Has its headquarters in Geneva.
Can overrule the USA GAAP when their policies disagree.
Was the predecessor to the IASC.
Promotes the use if high-quality and understandable global accounting standards.
The IASB declared that the merits of proposed standards are assessed.
From a position of materiality
From a position of neutrality
Based on possible impact on behavior
Based on arguments of lobbyist
The standard-setting process includes in the correct order
Research, discussion paper, exposure draft and accounting standard.
Discussion paper, research, exposure draft and accounting standard.
Exposure draft, research, discussion paper and accounting standard.
Research, exposure draft, discussion paper and accounting standard.
Research, exposure draft, discussion paper, and accounting standard.
Enables interested parties to express their own views on issues under consideration.
Is an efficient system for collecting dues from members.
Identifies the accounting issues that are the most important.
Requires that all CPAs must receive a copy of IFRS.
What is the due process in standard-setting body by IASB?
IASB operates in full view of the public
Public hearings are held on proposed standards
Interested parties can make their views known.
All of these are part of due process in standard-setting.
The standards published by IASB are called
International Accounting Standards
International Financial Reporting Standards
Financial Reporting Standards
Statement of Financial Accounting Standards
What is a possible danger if politics plays too big a role in developing IFRS?
User groups become active.
Individuals may influence the standards.
Financial reporting standards are not truly generally accepted.
The IASB delegates its authority to elected officials.
Accounting standard-setting
Is based solely on research and empirical findings.
Is based solely on research and empirical findings.
Can be described as a political process which reflects political actions of various interested user groups as well as a product of research and logic.
Is democratic in the sense that a majority of accountants must agree with a standard before it becomes enforceable.
IFRIC Interpretations issued by IASB
Cover newly identified financial reporting issues not specifically addressed.
Cover issues where unsatisfactory or conflicting interpretations have developed.
All of these are true about IFRIC Interpretations.
Financial accounting is concerned with
General purpose reports on changes in share prices.
General purpose reports on financial position and financial performance.
Specific reports for inventory management.
Specific reports for income tax computation
Financial accounting can be broadly defined ad the area of accounting that prepares
General purpose financial statements to be used by parties internal to the entity.
Financial statements to be used by investors.
Financial statements to be used primarily by management.
General purpose financial statements to be used by parties both internal and external to the entity.
Financial accounting emphasized reporting to
Creditors and investors
Management
Regulatory bodies
Internal auditors
Managerial accounting emphasizes
Developing accounting information for use within an entity
Reporting to the SEC
Reporting to the BIR
Developing accounting information for use within an entity
Which statement is true regarding managerial and financial accounting?
Managerial accounting is generally more precise.
Managerial accounting has a future focus.
Managerial accounting need not follow generally accepted accounting principles while financial accounting must follow GAAP.
The emphasis on managerial accounting is relevance and the emphasis on financial accounting is timeliness.
Generally accepted accounting principles
Are accounting adaptations based on law.
Derive their credibility and authority from legal rulings and court precedents.
Derive their credibility and authority from general recognition and acceptance by the accountancy profession.
Derive their credibility and authority from a government regulatory authority.
Which statement best describes GAAP?
The accounting principles have been developed on the basis of such factors as usage and practical necessity.
The accounting principle have been formulated in the public sector.
The accounting principles are same as laws.
The accounting principles do not apply to small and medium-sized entities.
Proper application of accounting principles is most dependent upon
Existence of specific guidelines
Oversight of regulatory bodies
Professional judgment of the accountant
External audit function
Once an accounting standard has been established
The principle of consistency requires that no revisions ever be made to the standard.
The task of reviewing the standard is given to the national accounting organization.
The standard is not reviewed unless a regulatory authority makes a complaint.
The standard is continually reviewed to see if modification is necessary.
The primary responsibility for properly applying GAAP lies with
External auditor
Management
Internal auditor
National accounting association
