Professional Documents
Culture Documents
The International Accounting Standards Board (IASB) is an independent, privately funded accounting standard-setter based in
London, England.
The IASB was founded on April 1, 2001 as the successor to the International Accounting Standards Committee (IASC). It is
responsible for developing International Financial Reporting Standards (the new name for International Accounting Standards issued
after 2001), and promoting the use and application of these standards.
Foundation. On January 25, 2001, the International Accounting Standards Foundation (IASF) was incorporated as a tax-exempt
organization in the US state of Delaware.[1] On February 6, 2001, the International Financial Reporting Standards Foundation was
also incorporated as a tax-exempt organization in Delaware.[2] The IFRS Foundation is the parent entity of the International
Accounting Standards Board (IASB), an independent accounting standard-setter based in London, England.[3]
On 1 March 2001, the IASB assumed accounting standard-setting responsibilities from its predecessor body, the International
Accounting Standards Committee (IASC). This was the culmination of a restructuring based on the recommendations of the report
Recommendations on Shaping IASC for the Future.
The IASB structure has the following main features: the IFRS Foundation is an independent organization having two main bodies,
the Trustees and the IASB, as well as a IFRS Advisory Council and the IFRS Interpretations Committee (formerly the IFRIC). The
IASC Foundation Trustees appoint the IASB members, exercise oversight and raise the funds needed, but the IASB has responsibility
for setting International Financial Reporting Standards (international accounting standards).
Members. The IASB has 15 Board members, each with one vote. They are selected as a group of experts with a mix of experience
of standard-setting, preparing and using accounts, and academic work. [4] At their January 2009 meeting the Trustees of the
Foundation concluded the first part of the second Constitution Review, announcing the creation of a Monitoring Board and the
expansion of the IASB to 16 members and giving more consideration to the geographical composition of the IASB.
The IFRS Interpretations Committee has 14 members. Its brief is to provide timely guidance on issues that arise in practice. [5]
A unanimous vote is not necessary in order for the publication of a Standard, exposure draft, or final "IFRIC" Interpretation. The
Board's 2008 Due Process manual stated that approval by nine of the members is required.[6]
The members (as of July 2011) are representatives from: Netherlands, UK, France, Sweden, USA, Germany, Japan, South Africa,
and China.
Due process
The IASB Handbook describes the consultative arrangements of the IASB. [6] The Board also publishes a brief guide on how standards
are developed.
Funding. The IFRS Foundation raises funds for the operation of the IASB.[9] Most contributors are banks and other companies
which use or have an interest in promoting international standards. In 2008, American companies gave 2.4m, more than those of
any other country. However, contributions fell in the wake of the financial crisis of 20072010, and a shortfall was reported in 2010.
The Philippine Institute of Certified Accountants or PICPA is the accredited professional organization (APO) of CPAs by the
Professional Regulation Commission (PRC) and has been awarded twice as PRC most outstanding APO from among other
professional organizations. PICPA was founded in November 1929 by a group of illustrious pioneers in the accounting profession.
Mission of PICPA
To promote, uphold, and maintain high standards in the accountancy profession; to serve the best interest of the members and the
stakeholders; and to contribute to the attainment of the national and global goals.
These can be achieved through a responsive organizational structure, committed leadership, effective professional development
programs, strict implementation of professional ethics, promotion of high standards of accounting education, and advocacy of and
participation in relevant national concerns.
The Financial Reporting Standards Council (FRSC) was established by the Board of Accountancy (BOA or the Board) in 2006 under
the Implementing Rules and Regulations of the Philippine Accountancy of Act of 2004 to assist the Board in carrying out its power
and function to promulgate accounting standards in the Philippines. The FRSCs main function is to establish generally accepted
accounting principles in the Philippines.
The FRSC is the successor of the Accounting Standards Council (ASC). The ASC was created in November 1981 by the Philippine
Institute of Certified Public Accountants (PICPA) to establish generally accepted accounting principles in the Philippines. The FRSC
carries on the decision made by the ASC to converge Philippine accounting standards with international accounting standards issued
by the International Accounting Standards Board (IASB).
The FRSC consists of a Chairman and members who are appointed by the BOA and include representatives from the Board of
Accountancy (BOA), Securities and Exchange Commission (SEC), Bangko Sentral ng Pilipinas (BSP), Financial Executives Institute
of the Philippines (FINEX), Commission on Audit (COA) and Philippine Institute of Certified Public Accountants (PICPA). The FRSC
has full discretion in developing and pursuing the technical agenda for setting accounting standards in the Philippines. Financial
support is received principally from the PICPA Foundation.
The FRSC monitors the technical activities of the IASB and invites comments on exposure drafts of proposed IFRSs as these are
issued by the IASB. When finalized, these are adopted as Philippine Financial Reporting Standards (PFRSs). The FRSC similarly
monitors issuances of the International Financial Reporting Interpretations Committee (IFRIC) of the IASB, which it adopts as
Philippine InterpretationsIFRIC. PFRSs and Philippine InterpretationsIFRIC approved for adoption are submitted to the BOA and
PRC for approval.
The FRSC formed the Philippine Interpretations Committee (PIC) in August 2006 to assist the FRSC in establishing and improving
financial reporting standards in the Philippines. The role of the PIC is principally to issue implementation guidance on PFRSs. The
PIC members are appointed by the FRSC and include accountants in public practice, the academe and regulatory bodies and users
of financial statements. The PIC replaced the Interpretations Committee created by the ASC in 2000.
The FRSC formed the Philippine Interpretations Committee (PIC) in August 2006 to assist the FRSC in establishing and improving
financial reporting standards in the Philippines. The role of the PIC is principally to issue implementation guidance on PFRSs. The
PIC members were appointed by the FRSC and include accountants in public practice, the academe and regulatory bodies and
users of financial statements. The PIC replaced the Interpretations Committee created by the ASC in 2000.
Philippine Interpretations - IFRIC. These correspond to Interpretations of the International Financial Reporting
Interpretations Committee (IFRIC) of the IASB.
Philippine Interpretations - SIC. These correspond to Interpretations of the Standing Interpretations Committee (SIC) of
the IASC.
PIC Q&As. These are Interpretations developed by the Philippine Interpretations Committee (PIC).
Effective
PFRS Title
Date
PFRS 1
First-time Adoption of Philippine Financial Reporting Standards 07/01/09
(revised)
Amendment to PFRS 1: Limited Exemption from Comparative PFRS 7 Disclosures for First-
07/01/10
time Adopters
PFRS 5 Non-current Assets Held for Sale and Discontinued Operations 01/01/05
Effective
PAS Title Date
Amendments to PAS 32 and PAS 1: Puttable Financial Instruments and Obligations Arising
01/01/09
on Liquidation
Amendments to PAS 19: Actuarial Gains and Losses, Group Plans and Disclosures 01/01/06
PAS 20 Accounting for Government Grants and Disclosure of Government Assistance 01/01/05
PAS 27 Consolidated and Separate Financial Statements [superseded by PAS 27 (revised)] 01/01/05
Amendments to PAS 32 and PAS 1: Puttable Financial Instruments and Obligations Arising
01/01/09
on Liquidation
Amendments to PAS 39: Transition and Initial Recognition of Financial Assets and
01/01/05
Financial Liabilities
Amendments to PAS 39: Cash Flow Hedge Accounting of Forecast Intragroup Transactions 01/01/06
Amendments to Philippine Interpretation IFRIC9 and PAS 39: Embedded Derivatives 06/30/09
Effective
Annual Improvements to PFRSs
Date
Amendments to PAS 1, PAS 16, PAS 19, PAS 20, PAS 23, PAS 27, PAS 28, PAS 29, PAS 31, PAS 36, PAS 38,
01/01/09
PAS 39, PAS 40, PAS 41
Amendments to PFRS 2, PAS 38, Philippine Interpretation IFRIC9, Philippine Interpretation IFRIC16 07/01/09
Amendments to PFRS 5, PFRS 8, PAS 1, PAS 7, PAS 17, PAS 36, PAS 39 01/01/10
Amendments to PFRS 3, PAS 1, Transition requirements for amendments to PAS 21, PAS 28 and PAS 31 made
07/01/10
as a result of PAS 27 (revised)
13 INVENTORIES
14 INVESTMENTS IN ASSOCIATES
16 INVESTMENT PROPERTY
20 LEASES
23 REVENUE
Appendix - Examples of revenue recognition under the principles in Section 23
24 GOVERNMENT GRANTS
25 BORROWING COSTS
26 SHARE-BASED PAYMENT
27 IMPAIRMENT OF ASSETS
28 EMPLOYEE BENEFITS
29 INCOME TAX
31 HYPERINFLATION
34 SPECIALISED ACTIVITIES
Effective
No. Title
Date
Philippine
Introduction of the Euro 01/01/05
Interpretation SIC7
Philippine
Government Assistance - No Specific Relation to Operating Activities 01/01/05
Interpretation SIC10
Philippine
Consolidation - Special Purpose Entities 01/01/05
Interpretation SIC12
Philippine
Jointly Controlled Entities - Non-Monetary Contributions by Ventures 01/01/05
Interpretation SIC13
Philippine
Operating Leases - Incentives 01/01/05
Interpretation SIC15
Philippine
Income Taxes - Changes in Tax Status of an Enterprise or its Shareholders 01/01/05
Interpretation SIC25
Philippine
Evaluating the Substance of Transactions Involving the Legal Form of a Lease 01/01/05
Interpretation SIC27
Philippine
Disclosure - Service Concession Arrangements 01/01/05
Interpretation SIC29
Philippine
Revenue - Barter Transactions Involving Advertising Services 01/01/05
Interpretation SIC31
Philippine
Intangible Assets - Web Site Costs 01/01/05
Interpretation SIC32
MULTIPLE CHOICE
1. The legal basis of the Philippine Accountancy Act of 2004
a. RA 9298 b. PD 692 c. Senate Bill No. 2748 d. House Bill No. 6678
2. The Philippine Accountancy Act of 2004 became a law in what particular month of 2004?
a. February b. March c. April d. May
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3. The body mandated by law promulgates rules and regulations affecting the practice of Accountancy.
a. Professionals Regulation Commission (PRC)
b. Professional Regulatory Board of Accountancy (BoA)
c. Philippine Institute of Certified Public Accountants (PICPA)
d. Accounting Standards Council (ASC)
4. A body created by PICPA to formalize the accounting standards-setting function and establish generally accepted
accounting principles in the Philippines.
a. Accounting Standards Council (ASC)
b. Associations of CPAs in Education (ACPAE)
c. Association of CPAs in public Practice (ACPAPP)
d. Professional Regulatory Board of Accountancy (BoA)
6. The number of members (including the chairman) in the Accounting Standards Council.
a. 5 b. 8 c. 9 d. 10
8. According to the Implementing Rules and Regulations (IRR) of the Philippine Accountancy Act of 2004, the
Accounting Standards Council (ASC) was replaced by the
a. Auditing and Assurance Standards Council (AASC)
b. Financial Reporting Standards Council (FRSC)
c. Education Technical Council (ETC)
d. PICPA Education Task Force
9. The number of members (including the chairman) in the Financial Reporting Standards Council.
a. 12 b. 13 c. 14 d. 15
10. One of the following is not a member of the Financial Reporting Standards Council.
a. Commission on Audit (CoA)
b. Bureau of Internal Revenue (BIR)
c. Professional Regulatory Board of Accountancy (BoA)
d. Financial Executives Institute of the Philippines (FINEX)
11. Under the IRR, the chairman and members of FRSC shall have a renewable term of how many years?
a. 2 b. 3 c. 4 d. 5
12. These arte standards and interpretations adopted by the Financial Reporting Standards Council. They
compromise (a) Philippine Financial Reporting Standards (PFRS), (b) Philippine Accounting Standards (PAS),
and (c) Interpretations of PFRS and PAS.
a. Philippine Financial reporting Standards (PFRS)
b. Philippine Accounting Standards (PAS)
c. Interpretations of PFRS
d. Interpretations of PAS
13. Final concurrence of a duly approved Philippine Financial Reporting Standards (PFRS) rest with
a. Professionals Regulations Commission (PRC)
b. Financial Reporting Standards Council (FRSC)
c. Philippine Institute of certified Public Accountants (PICPA)
d. Government Association of Certified public Accountants (GACPA)
14. There are four (4) sectors of the accountancy profession in the Philippines. The branch of accounting related with
the sector Association of CPAs in Commerce and Industry (ACPACI) is
a. Public accounting b. Private accounting c. Government accounting d. Accounting education
15. It is an independent private sector body formed in 1973, with the objective of achieving uniformity the accounting
principles that are used by business and other organizations for financial reporting around the world.
a. International Accounting Standards Committee (IASC)
b. International Accounting Standards Board (IASB)
c. Financial Accounting Standards Board (FASB)
d. World trade Organization (WTO)
16. Under the 2001 IASC organizational structure, one of the following is not associated with the IASC.
a. Standards Advisory Council (SAC)
b. International financial Reporting Interpretation Committee (IFRIC)
c. International Accounting Standards Board (IASB)
d. Financial Reporting Standards Council (FRSC)
9
17. The exact IASC counterpart that drafts and approves International Financial Reporting Standards (IFRSC) under
the new organizational framework of its 2001 constitution is the
a. IAS Foundation
b. IAS Board (IASB)
c. Standards Advisory Council (SAC)
d. International Financial Interpretations Committee (IFRIC)
18. Which of the following correctly describes the Standards Advisory Council Based on the 2001 IASC structure?
a. It is an independent, not-for-profit foundation based in the United States, whose trustees appoint members of
the IASBA, SAC and IFRIC
b. It is responsible for developing and issuing new international standards to be known as International Financial
Reporting Standards (IFRS)
c. It is to advise the IASB on what particular topics or accounting issues the Board should be looking at.
d. It is to come up with guidelines known as Interpretations for FS users in case new problems arise and /or
existing standards are being interpreted in unsatisfactory or conflicting ways.
19. Which of the following statements relating to the FRSC and standard setting process in the Philippines is (are)
true?
I. Members of the FRSC who are recommended by PICPA as the representatives of the four sectors of
the accountancy profession should be CPAs.
II. The Financial Reporting Standards Council (FRSC), Board of Accountancy (BoA), the Philippine
Institute of CPAs (PICPA), the Philippine Interpretations Committee (PIC), the Professional
Regulations Commission (PRC) are all involved in the standard setting process, PRC as the final
approving authority.
III. Members of the accountancy profession may participate in the accounting standard setting process
by responding to invitations to comment on the Exposure Drafts issued by the accounting standard-
setters.
a. I is true b. I and II are true c. I and III are true d. I, II, and III are true.
20. As an assistance to the FRSC and the Philippine accountancy profession and the public it serves, which of the
following should the Philippine Interpretations Committee (PIC) consider issuing an interpretation?
I. Newly identified financial reporting issues in the Philippines not specifically addressed in PFRSs.
II. Narrow, industry-specific issues.
III. Philippine accounting and reporting issues where unsatisfactory or conflicting interpretations have
developed, or seem likely to develop.
a. I and II only b. II and III only c. I and III only d. I, II, and III.
21. Which of the following is NOT part of the financial reporting standard setting process in the Philippines?
a. Creation of a task force by the standard setting body to study the proposed accounting standard.
b. Distribution of the Exposure Draft for comment to CPA professionals and other interested parties.
c. Approval by the Financial Reporting Standards Council (FRSC) and eventually by the Professional
Regulations Commission (PRC).
d. Publication in the PRC Official Gazette and in a newspaper of general circulation.
22. Which one of the following bodies is responsible for reviewing accounting issues that are likely to receive
divergent or unacceptable treatment in the absence of authoritative guidance, with a view to reaching consensus
as to the appropriate accounting treatment?
a. International Financial Reporting Interpretations Committee (IFRIC)
b. Standard Advisory Council (SAC)
c. International Accounting Standards Board (IASB)
d. International Accounting Standards Committee Foundation (IASC Foundation)
23. The Association of Realtors in the Philippines is seeking permission to use PAS 11 Construction Contracts rather
than PAS 18, Revenue Recognition, in accounting for the selling transactions of small condominium builders. The
body responsible for addressing this accounting issue to reach a consensus as to the appropriate accounting
treatment is the
a. IFRIC b. FRSC c. PIC d. IASB
24. What is due process in the context of standard setting at the IASB?
a. Interested parties can make their views known.
b. IASB and FASB operates in full view of the public.
c. Public hearings are held on proposed accounting standards.
d. All of the above.
25. The following published documents are part of the due process system used by the IASB in the evolution of a
typical IASB Standard
1. Exposure Draft 2. IASB Standard 3. Discussion Paper
The chronological order in which these items are released is as follows:
TOA-2-14 IASB/PFRSC-001