Legal basis and amended act
- Commonwealth Act No. 342 amends Act No. 105, entitled “AN ACT REGULATING THE PRACTICE OF PUBLIC ACCOUNTANCY; CREATING A BOARD OF ACCOUNTANCY; PROVIDING FOR EXAMINATION FOR THE GRANTING OF CERTIFICATES AND THE REGISTRATION OF CERTIFIED PUBLIC ACCOUNTANTS; FOR THE SUSPENSION OR REVOCATION OF CERTIFICATES, AND FOR OTHER PURPOSES”.
- Prior amendments referenced include Acts Nos. 3264, 3322, 3401, and 3411 as they relate to the amended sections.
- Commonwealth Act No. 342 also ties trade-name use to compliance with Act No. 3883.
Authorized public accountant title
- A certificate of qualification issued by the Board authorizes the holder to style himself and be known as a “Certified Public Accountant”.
- Holders may use the abbreviated title “C. P. A.” once they have received the certificate as provided by law.
Eligibility for certificate applicants
- Applicants for certificates must be citizens of the Philippine Islands or citizens of the United States, or of foreign countries granting similar privileges to citizens of the Philippine Islands.
- Applicants must be over twenty-one years of age and of good moral character.
- Applicants must be graduates of high schools having a four years course or have an equivalent education.
- Applicants must have at least three years practical experience in professional accounting or three years of study in accounting and commercial subjects, as certified by a college or university recognized by the Government.
Board waiver of examination
- The Board may waive the examination for a person who is of competent age, of good moral character, and holds a lawful holder status of a certified public accountant certificate or similar certificate under Act No. 3264 or foreign law.
- The waiver applies to certificates issued under the law of any state or territory of the United States, the District of Columbia, or any foreign country.
- The waiver applies only if the issuing state or territory, the District of Columbia, or the country extending the chartered accountant or similar certificate extends similar privileges to Certified Public Accountants of the Philippine Islands.
- The waiver also applies where the applicant holds a certificate as a chartered accountant or other similar certificate, provided the reciprocity condition is met.
Registration by prior professional engagement
- A person engaged in professional accountancy work in the Philippine Islands for five years or more before the application date is entitled to registration as a certified public accountant.
- The registrant must hold certificates as a certified public accountant, chartered accountant, or other similar certificates or degrees in the country of his nationality.
- Registration entitlement is conditioned on the foreign country or state not restricting the right of Filipino certified public accountants to practice therein.
- Registration entitlement is further conditioned on reciprocal rights to Filipinos being granted by the foreign country or state.
- The application for registration must be filed with the Board not later than December 31, 1938.
Unauthorized practice and confidentiality duties
- A person who represents himself to the public as having received the certificate required by the Act, or who assumes practice as a certified public accountant or uses “C. P. A.” or similar words or letters, without having received the certificate, is punishable.
- A person who assumes to practice as a public accountant without having received the required public accountant’s certificate is punishable.
- A person who uses the certificate when thereafter deprived of its use by temporary suspension or revocation is punishable.
- The penalty for each such offense is a fine not exceeding five thousand pesos (PHP 5,000) or imprisonment not exceeding two years, or both, at the court’s discretion.
- Each day that the person practices or holds himself out as a certified public accountant is treated as a separate offense.
- A certified public accountant or a person employed by a public accountant must not disclose or divulge the contents of communications from the person employing him to examine, audit, or report on books, records, or accounts.
- A certified public accountant or a person employed by a public accountant must not disclose any information derived from books, records, or accounts when rendering professional service.
- Disclosure is allowed only by order of the court or express permission of the person employing him, or of the heirs, personal representatives, or successors.
- Violations of the confidentiality rule carry the same penalty as the first paragraph (fine up to PHP 5,000, imprisonment up to two years, or both), for each offense.
- A certified public accountant who willfully falsifies any report or statement bearing on any examination, investigation, or audit made by him or under his direction is subject to the same penalty as the first paragraph.
- The confidentiality and penalty provisions apply to all active resident members of partnerships or corporations engaged in behalf of such partnerships or corporations in the practice of accountancy in the Philippine Islands, and they do not apply to non-resident members.
Trade name entitlement for accountancy practice
- Any person, partnership, or corporation engaged in the practice of accountancy in the Philippine Islands is entitled to adopt, acquire, and use a trade name in connection with such practice.
- Trade name use is conditioned on compliance with Act No. 3883.
- Trade name use is also conditioned on proper qualification and registration of the names of all partners or members with the Board of Accountancy.
Effect of the amendments
- Commonwealth Act No. 342 amends the specified provisions of Act No. 105 by replacing the stated text of Sections 1, 4(b), 11, 12, and 16.
- Commonwealth Act No. 342 inserts Section 16-A immediately after Section 16 of Act No. 105, establishing the trade-name rule for accountancy practice.