New Bill aims to empower RP's board of accountancy

CEBU, Philippines - To give more power to the board of accountancy, Cebu fifth district representative Ramon “Red” Durano VI is pushing for the development of the accounting profession in the country through the passage of the Accountancy Bill.

“The accounting profession in the Philippines has grown tremendously, not only in terms of membership, but in scope of activities for the last 47 years since its official recognition through Act No. 3105, the law which created the Board of Accountancy, on March 17, 1923,. Since then, several amendatory legislations had been passed. The most recent is Republic Act No. 9298, the Revised Accountancy Act of 2004,” Durano said.

Over the years, the accounting profession has attained progress as compared to other professions in the country and gained the confidence and respect of all sectors of the society.

With this new Bill, Durano said it will empower the Board of Accountancy (BOA) to police their members against illegal practices.

The Cebuano representative, who was the chairman for the economic affairs in the 14th Congress said that in the recent past, “our attention was captured by the scandals which rocked corporations worldwide, and these scandals brought to fore the crucial role player by accountants and auditors in curbing corporate abuses.”

In the Philippines Durano said “we have had our share of scandals such as he BW Resources and educational pre-need companies including Pacific Plans and College Assurance Plans, which have long defied public trust and confidence due to mismanagement of their respective funds and resources.”

Durano added that the GSIS (Government Social Insurance System) and SSS (Social Security System) are likewise being questioned in terms of their capability to sustain funds to pay back their members.    

It is also apparent that large sums of money that are expended by unscrupulous businessmen for alleged “kickbacks” to government officials would not go unnoticed if auditors are zealous in the performance of their functions, he said.

“There could be no other source for these “kickbacks” than the revenues derived from government contracts which should have been properly reported. It is of interest to inquire into the ‘bona fides’ of the auditors who gave their ‘imprimatur’ to the financial statements of firms who have contracts with the government,” he said.

Under the present law, RA 9298, one of the powers of the Board of Accountancy is to conduct an oversight into the quality of audits of financial statements through a review of the quality control measures instituted by auditors in order to ensure compliance with accounting and auditing standards and practices (Sec. 9h).

Considering the present financial crisis and its impact on the Philippine economy, as well as the collateral damage upon investment and employment opportunities that may arise out of any accounting and auditing scandal that may rock the profession, it is now opportune to have a second look at the powers of the Board of Accountancy.

Durano said it should be provided with more tools in its kit of regulatory powers, ability to impose sanctions in order to ensure compliance, grant of measures of fiscal autonomy to enable it to effectively shield the country from any future accounting and auditing scandals.

“In so doing, we have not only “put the license in order” in so far as the accounting profession is concerned, but we have put in place a mechanism to strengthen investor protection. This will reinvigorate the investments climate as investor confidence sets in and this will propel the economy to higher levels of growth,” Durano concluded.