Introduction to Accounting:

The Nature
Environment
The Standards
The Assumptions and Principles

Brought to you by:

July 24, 2021

Learning Objectives:
After studying this chapter, you should be able to:

• Define accounting and explain its role in business.

• Have a fair knowledge of the evolution of accounting and find how it affected accounting
pedagogy, policy and practice.

• Discuss the basics of ASEAN 2015 and recognize how it will affect accountancy practice in
the region.

• Describe the fundamental business model and find how it is applied to the various types of
businesses.

• Distinguish between the different forms and activities of business organizations.

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• Explain the importance of the purpose and phases of accounting.
Learning Objectives:
• Ascertain the need to adapt Fra Luca Pacioli's system for the modern times.

• Explain the fundamental ačcounting concepts and principles.

• Summarize the salient features of the Accountancy Act of 2004, the Core Competencies
Framework and the Code of Ethics for Professional Accountants and harness them to attain
professional advancement.

• Explain why ethics are crucial in accounting.

• Identify and discuss the career opportunities open to accountants. 

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Learning Objectives:
• Summarize and relate the functions of bodies within the IASB Structure.

• Detail the standard-setting process used to develop Standards. 3. Explain the necessity for IAS.

• State the purpose of a conceptual framework.

• Explain the objective of general purpose financial statements and the stewardship of management.

• Identify the users of accounting information and illustrate their information needs. 

• Explain the qualitative characteristics of useful financial information.

• Expound on the going concern assumption.

• Identify the elements of financial statements.

• Recognize the various bases for measuring the elements of financial statements. 

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 Let’s try to know...
DENNIS RODMAN
 Dennis Rodman is born in Dallas, USA and deserted by
his father (who is incidentally residing here in the
Philippines) at age three. His mother, Shirley, raised
Rodman in a housing project. At 20, he was working as a
janitor at the Dallas Airport for $5.0 an hour, but a year
later he was arrested there for stealing fifty watches: the
charges were dropped when the authorities were able to
recover the goods. Rodman had given them to
friends. Then, when he was 21, a local junior college
basketball scout suggested that Rodman, who had grown
a good half-foot since high school, to try basketball. He
tried and failed at first try but on second try at
Southeastern Oklahoma State, he made All-American and
the grades required to stay in school. Rodman was 25 –
ancient for rookie – when he finally landed in the
National Basketball Association (NBA). 5
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Let’s try to know...

 Though Rodman proved his talent as a pivotal Detroit

Pistons, it took him a long time to catch up one of the
league's best rebounders, grabbing and he never earned more
than $2.5 million in a single year. 

 During the 1995 playoffs, on a day off (at that time he’s
playing for the San Antonio Spurs), Rodman was sitting in
his kitchen pondering his financial woes with Manley.
Manley is his best friend and agent. His $3,800 Ferrari was
more than a week late. A $9,000 alimony check to ex-wife
Annie was looming. And to make matters worse, a half-
million dollars he'd borrowed from the Pistons to buy his first
house years  earlier  had gone unpaid for five years now, had
ballooned to $745,000 including interest. There are still other
dues. All told, Rodman was close to $1.0 million in debt
.Turning to his friend, he said plainly, "I need you to make
me some money, Bro." 
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Let’s try to know...

 Manley's first move was to line up Rodman in autograph

sessions for $50 per signature. He negotiated with Rodman's
creditors, telling them if they wanted to get paid in full they'd
have to wait awhile, and if they wanted cash today, they could
take a discount. And he put together a seven-figure deal to
publish Rodman's autobiography, Bad As I Wanna Be
(Delacorte, 1996), which became an instant bestseller. 

 Rodman agreed to be placed by Manley on $1,000 weekly

allowance. He exchanged his American Express card for a debit
card. In the midst of Rodman's financial makeover, another
lucky break: Rodman was traded to the Chicago Bulls. At first,
he was not up to the idea. But Manley convinced Rodman that
playing with Michael Jordan and Scottie Pippen was the best
conceivable way to boost his marketing muscle. 

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Let’s try to know...

 By the end of the 1996 NBA season, Rodman had $1.0
million in the bank, a chunk of it from the $150,000 bonus
he earned for helping the Bulls make their way to the NBA
Championship. He was on track to hit $2.0 million by the
end of the year. Plus, he now has a sizeable investment
portfolio (in mutual funds, tech stocks, a controlling
interest in a $10 million in sales excavation company). He
made a killing in Oakley-maker of the sunglasses he wears
"everyday" 

 In 1997, according to the Chicago press, Rodman signed

an $8.0 million deal with the Bulls. He has endorsement
deals with Kodak, Converse and Carl's Jr. among others.
He  did a movie with Jean Claude Van Damme. He has two
more books in production and more scripts than he can
count. Appearances in MTV and in wrestling. Romantic
episodes with Madonna, Carmen Electra and other
celebrities. Rodman, who spends $100 to change his hair
from blue to orange to white to whatever, is now out of the
NBA of his eccentricities nonetheless he's come very far. 8
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Now let’s see this…

What role does accounting play in the life of Dennis
Rodman?

Rodman, through the efforts of his friend, Manley, used

accounting information in one form and another.
• His manager used budgeting to help Rodman with his
finances.
• Manley used his financial sense in the idea of “wait
awhile to be paid or cash today but with a discount”
• Financial analysis through strategic investments and
endorsement deals

Manley needed and relied on accounting information to

guide him in his dealings for Rodman, in order to save
Rodman in the brink of bankruptcy to possible financial
prosperity. 9
 ACCOUNTING
Accounting has evolved, as in the case of medicine and law,
in response to the social and economic needs of society. As
business and society become more complex, accounting
develops new concepts and techniques to meet the ever-
increasing needs for financial information. Without such
information, many complex economic developments and
social programs may never have been undertaken. 
 Accounting is relevant in all walks of life, and it is
absolutely essential in the world of business.
Accounting is the system that measures business
activities, processes that information into reports
and communicates the results to decision-makers.
Accounting quantifies business communication. the
language of business. For this reason, accounting is
called the language of business
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DEFINITIONS OF ACCOUNTING

Accounting is defined, as follows:

Accounting as Service Activity Accounting as an Information

System

 Accounting is a service activity. Its function is  Accounting is an information system that

to provide quantitative information, primarily measures, processes and communicates
financial in nature, about economic entities financial information about an economic
that is intended to be useful in making entity (Statement of Financial Accounting
economic decisions (Statement of Financial Concepts No. 1, "Objectives of Financial
Accounting Standards No. 1, "Basic Concepts Reporting by Business Enterprises”
and Accounting Principles Underlying Financial (Norwalk, Conn.: Financial Accounting
Statements of Business Enterprises" (Manila: Standards Board, 1978), par. 9). 
Accounting Standards Council, 1983), par. 1).  11
DEFINITIONS OF ACCOUNTING
Accounting is defined, as follows:

Accounting as a Process Accounting as an Art

 Accounting is the process of identifying,  Accounting is the art of recording,

measuring and communicating economic classifying and summarizing in a significant
information to permit informed judgments and manner and in terms of money, transactions
decisions by users of the information (American and events which are, in part at least, of a
Accounting Association, "A Statement of Basic financial character, and interpreting the
Accounting Theory" (Evanston, III.: American results thereof (American Institute of
Accounting Association, 1966), par. 1; Accounting Certified Public Accountants, "Review and
Principles Board, Statement No. 4, "Basic Resume”, Accounting Terminology Bulletin
Concepts and Accounting Principles Underlying No. 1 (New York: AICPA, 1953), par. 9). 
Financial Statements of Business Enterprises”
(New York: AICPA, 1970), par. 40).  12
EVOLUTION OF ACCOUNTING 
Accounting history is important to accounting pedagogy, policy and practice. It makes it possible to better
understand our present and to forecast our future. Accounting history is the "study of the evolution in
accounting thought, practices and institutions in response to changes in the environment and societal needs.
• Primitive Accounting
• Middle Ages
• The Florentine Approach
• The Method of Venice
• The development of Double-entry Bookkeeping by Frater Luca Bartolomes Pacioli or Luca Pacioli, that changed
accounting throughout the history.
• Savary and Napoleonic Commercial Code
• Industrial Revolutions, Corporate Organizations, Railroads, United States Steel
• Schmalenbach and the Model Chart of Accounts
• Imposition of Income Tax and Conflicts with Financial Accounting
• Information Age
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THE FUNDAMENTAL BUSINESS MODEL

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TYPES OF BUSINESS
Type Activity Structure Examples
   
Services Selling professional services, any Hiring skilled staff and selling their Software development
type of service  time 
Accounting
   
Legal 
 
Trader Buying and selling products  Wholesaler Retailer  Buying a range of raw materials and manufactured goods and
consolidating them, making them available for sale in
     
locations near to their customers or online for delivery 
 
 

Manufacture Designing products, aggregating Taking raw materials and using Vehicle Assembly
components and assembling finished equipment and staff to convert them
  Construction Engineering
products  into finished goods 
Electricity
   
Water
Food and drink
Chemicals
Media
Pharmaceuticals 
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TYPES OF BUSINESS
Type Activity Structure Examples
   
Raw materials Growing or extracting raw materials  Buying blocks of land and using them to Farming
provide raw materials 
    Mining 
 
Oil 
 

Infrastructure Selling the utilization of infrastructure  Buying and operating assets (typically Transport (airport operator, airlines, trains, ferries, buses) Hotels
large assets); selling occupancy often in
  combination with services  Telecoms

  Sports facilities
Property management 
 

Financial Receiving deposits, lending and Bank Investment house  Accepting cash from depositors and paying them interest; using
investing money  the money to provide loans to borrowers, charging them fees and
    a higher rate of interest than the depositors receive 
 
 

Insurance Insurance  Pooling premiums of many to meet claims Collecting cash from many customers; investing the money to
of a few  pay the losses experienced by a few
   
 
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FORMS OF BUSINESS ORGANIZATIONS 
Sole Proprietorship
• This business organization has a single owner called the proprietor who generally is also the manager.
Sole proprietorships tend to be small service-type (e.g. physicians, lawyers and accountants) businesses
and retail establishments. The owner receives all profits, absorbs all losses and is solely responsible for
all debts of the business. From the accounting viewpoint, the sole proprietorship is distinct from its
proprietor. Thus, the accounting records of the sole proprietorship do not include the proprietor's
personal financial records. 
Partnership
• A partnership is a business owned and operated by two or more persons who bind themselves to
contribute money, property, or industry to a common fund. with the intention of dividing the profits
among themselves. Each partner is personally liable for any debt incurred by the partnership.
Accounting considers the partnership as a separate organization, distinct from the personal affairs of
each partner 
Corporation
• A corporation is a business owned by its stockholders. It is an artificial being created by operation of
law, having the rights of succession and the r e attributes and properties expressly authorized by law or
incident to its existence. The stockholders are not personally liable for the corporation's debts. The
corporation is a separate legal entity. 

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MICRO, SMALL AND MEDIUM ENTERPRISES 
On May 23, 2008, Republic Act No. 9501 was signed into law by President Gloria Macapagal-Arroyo. This law seeks
to address problems facing MSMEs, particularly the lack of capital and access to credit. Under the law, banks and
lending institutions are now required to allocate at least 10% of their total loan portfolio to MSMEs, broken down
as follows: 8% to micro and small enterprises, and 2% to medium enterprises. The old law provided only for a total
of 8%. 

The new law also gives the Small Business Corporation, the government financial institution created to assist
MSMEs, more financial muscle by increasing its authorized capital stock to P10.0 billion. 

The law also updated the definitions of MSMEs by increasing the net assets threshold.

• Micro enterprises are those with assets, before financing, of P3.0 (before P1.5 million) or less and employ not
more than nine workers.

• Small enterprises are those with assets, before financing, of above P3.0 (before P1.5 million) to P15 million and
employ 10 to 99 workers.

• Medium enterprises have assets, before financing, of above P15 million to P100 million and employ 100 to 199
workers. 18
ACTIVITIES IN BUSINESS ORGANIZATIONS 
Many types of decisions are made in business organizations. Accounting provides
important information to make these decisions. The three types of organizational
activities are as follows: financing, investing, and operating. 

Financing Activities
• Organizations require financial resources to obtain other resources used to
produce goods and services. They compete for these resources in financial
markets. Financing activities are the methods an organization uses to obtain
financial resources from financial markets and how it manages these resources.
Primary sources of financing for most businesses are owners and creditors, such
as banks and suppliers. Repaying the creditors and paying a return to the owners
are also financing activities.  19
ACTIVITIES IN BUSINESS ORGANIZATIONS 
(Continued..)

Investing Activities 
• Managers use capital from financing activities to acquire other resources used
in the transformation process-that is, to transform resources from one form
to a different form, which is more valuable, to meet the needs of the people.
Having the right mix of resources is essential to efficient and effective
operations. 

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ACTIVITIES IN BUSINESS ORGANIZATIONS 
(Continued..)

Operating Activities
• Operating activities involve the use of resources to design, produce,
distribute, and market goods and services. Operating activities include
research and development. design and engineering, purchasing, human
resources, production, distribution, marketing and selling, and servicing.
Organizations compete in supplier and labor markets for resources used in
these activities. Also, they compete in product markets to sell the goods and
services created by operating activities. 

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 PURPOSE AND PHASES OF ACCOUNTING 

The accounting function is part of the broader business system, and

does not operate in isolation. It handles the financial operations of
the business but also provides information and advice to other
departments. Business transaction are the economic activities of a
business. Recording these historical events is a significant function
of accounting Accounts are produced to aid management in planning,
control and decision-making and to comply with regulations. 

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 PURPOSE AND PHASES OF ACCOUNTING 

Before the effects of transactions can be recorded, they must be measured. In order that
accounting information will be useful, it must be expressed in terms of a common financial
denominator-money. Money serves as both a medium of exchange and a measure of value. 

To measure a business transaction, the accountant must decide when the transaction occurred
(recognition issue), what value to place on the transaction (valuation issue) and how the
components of the transaction should be classified (classification issue). 

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 PURPOSE AND PHASES OF ACCOUNTING 

By simply measuring and recording transactions, the resulting information will be

of limited use. To be useful in making decisions, the recorded data must be
classified and summarized. Classification reduces the effects of numerous
transactions into useful groups or categories. Summarization of financial data is
achieved through the preparation of financial statements. These summarize the
effects of all business transactions that occurred during some period. 

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 PURPOSE AND PHASES OF ACCOUNTING 

After going through the preceding phases, it is imperative that the

result of the summarization phase be interpreted or analyzed to
evaluate the liquidity, profitability and solvency of the business
organization. Accounting provides the decision-makers with
information to make reasoned choices among alternative uses of
scarce resources in the conduct of business and economic activities. 

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 PURPOSE AND PHASES OF ACCOUNTING 

After going through the preceding phases, it is imperative that the

result of the summarization phase be interpreted or analyzed to
evaluate the liquidity, profitability and solvency of the business
organization. Accounting provides the decision-makers with
information to make reasoned choices among alternative uses of
scarce resources in the conduct of business and economic activities. 

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PACIOLI'S DOUBLE-ENTRY BOOKKEEPING
AND ITS EVOLUTION 
Will be discussed next week…

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Fundamental Concepts of
Accounting

• Entity Concept
• Periodicity Concept
• Stable Monetary Unit Concept

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 ENTITY CONCEPT

The most basic concept in accounting is the entity concept. An accounting entity is
an organization or a section of an organization that stands apart from other
organizations and individuals as a separate economic unit. Simply put, the
transactions of different entities should not be accounted for together. Each entity
should be evaluated separately. 

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 PERIODICITY CONCEPT

An entity's life can be meaningfully subdivided into equal time periods for reporting
purposes. It will be aimless to wait for the actual last day of operations to perfectly
measure the entity's profit. This concept allows the users to obtain timely
information to serve as a basis on making de For the purpose of reporting to
outsiders, one year is the usual accounting period. 

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 STABLE MONETARY UNIT CONCEPT

The Philippine peso is a reasonable unit of measure and that its purchasing power
is relatively stable. It allows accountants to add and subtract peso amounts as
though each peso has the same purchasing power as any other peso at any time.
This is the basis for ignoring the effects of inflation in the accounting records. 

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CRITERIA FOR GENERAL ACCEPTANCE
OF AN ACCOUNTING PRINCIPLE 

Accounting practices follow certain guidelines.

GAAP, which stands for generally accepted
accounting principles, encompass the conventions,
rules and procedures necessary to define accepted
accounting practice at a particular time.

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CRITERIA FOR GENERAL ACCEPTANCE OF AN ACCOUNTING PRINCIPLE (continued..)

The general acceptance of an accounting principle usually depends on how well it

meets three criteria: relevance, objectivity and feasibility. 
A principle has relevance to the extent that it results in information that is meaningful and useful to
those who need to know something about a certain organization. 

A principle has objectivity to the extent that the resulting information is not influenced by the
personal bias or judgment of those who furnish it. Objectivity connotes reliability and
trustworthiness. It also connotes verifiability, which means that there is some way of finding out
whether the information is correct. 

A principle has feasibility to the extent that it can be implemented without undue complexity or cost.
These criteria often conflict with one another. In some cases, the most relevant solution may be the
least objective and the least feasible. 

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CRITERIA FOR GENERAL ACCEPTANCE OF AN ACCOUNTING PRINCIPLE (continued..)

The general acceptance of an accounting principle usually depends on how well it

meets three criteria: relevance, objectivity and feasibility. 
A principle has relevance to the extent that it results in information that is meaningful and useful to
those who need to know something about a certain organization. 

A principle has objectivity to the extent that the resulting information is not influenced by the
personal bias or judgment of those who furnish it. Objectivity connotes reliability and
trustworthiness. It also connotes verifiability, which means that there is some way of finding out
whether the information is correct. 

A principle has feasibility to the extent that it can be implemented without undue complexity or cost.
These criteria often conflict with one another. In some cases, the most relevant solution may be the
least objective and the least feasible. 

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BASIC PRINCIPLES
• Objectivity
• Historical Cost
• Revenue Recognition Principle
• Expenses Recognition Principle
• Adequate Disclosure
• Materiality
• Consistency
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 Objectivity Principle

Accounting records and statements are based on the most reliable data available so
that they will be as accurate and as useful as possible. Reliable data are verifiable
when they can be confirmed by independent observers. Ideally, accounting records
are based on information that flows from activities documented by objective
evidence. Without this principle, accounting records would be based on whims and
opinions and is therefore subject to disputes. 

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 Historical Cost

This principle states that acquired assets should be recorded at their

actual cost and not at what management thinks they are worth as at
reporting date. 

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 Revenue Recognition Principle

Revenue is to be recognized in the accounting period when goods are

delivered or services are rendered or performed. 

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 Expense Recognition Principle

Expenses should be recognized in the accounting period in which goods

and services are used up to produce revenue and not when the entity
pays for those goods and services. 

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 Adequate Disclosure

Requires that all relevant information that would affect the user's
understanding and assessment of the accounting entity be disclosed in
the financial statements. 

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 Materiality

Financial reporting is only concerned with information that is significant

enough to affect evaluations and decisions. Materiality depends on the
size and nature of the item judged in the particular circumstances of its
omission. In deciding whether an item or an aggregate of items is
material, the nature and size of the item are evaluated together.
Depending on the circumstances, either the nature or the size of the
item could be the determining factor. 

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 Consistency Principle

The firms should use the same accounting method from period to
period to achieve comparability over time within a single enterprise.
However, changes are permitted if justifiable and disclosed in the
financial statements 

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ACCOUNTANCY IN THE
PHILIPPINES 

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 Some of the known professionals…
• Don Vicente Fabella, in 1915, became the first Filipino CPA in the United States (passed the Milwaukee,
Wisconsin CPA Board Exams), and founder of Jose Rizal University (JRU) in 1919

• Dr. Nicanor Reyes, founder and first President of the Far Eastern University (started in 1928 as the Institute
of Accountancy, which later became the Institute of Accounts, Business and Finance, and then registered as
the Far Eastern University in Jan. 31, 1934 (the official birthday, though, is Nov. 5, 1933]), Mr. FEU died a
hero during WWII

• Belen Enrile-Gutierrez, first Filipina CPA and one of the seven original trustees of FEU in 1933

• Jaime Hernandez and Paciano Dizon, the first and second Filipino Auditor Generals of the Commission on
Audit

• Manuel Villar, Filipino tycoon, former Speaker of the House of Representatives, Senate President, and 2010
Presidential candidate of the Nacionalista Party

• Washington SyCip, past president of the International Federation of Accountants, the only Asian who has
held the position and Founder and Past Chairman of SGV & Co., the leading accountancy firm in the country
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ACCOUNTANCY ACT OF 2004

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 Any person applying for examination shall establish the following
requisites to the satisfaction of the Board that he/she:

• is a Filipino citizen

• is of good moral character

• is a holder of the degree of Bachelor of Science in Accountancy conferred by

a school, college, academy or institute duly recognized and/or accredited by
the Commission on Higher Education (CHED) or other authorized government
offices
• has not been convicted of any criminal offense involving moral turpitude. 

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CODE OF ETHICS FOR PROFESSIONAL
ACCOUNTANTS IN THE PHILIPPINES 

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ACCOUNTING STANDARDS IN
THE PHILIPPINES 

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 INTRODUCTION TO IASB

• The International Accounting

Standards Board (ASB) is an
independent private sector body. Its
objective is to achieve convergence
in the accounting principles that are
used by businesses and other
organizations for financial reporting
around the world. 
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Standards IASB publishes its Standards in a series of
pronouncements called International Financial Reporting
Standards (IFRS). It has also adopted the body of Standards
issued by the of the International Accounting Standards
Committee (1973-2001). Those pronouncements continue to
be designated "International Accounting Standards (IAS)" 

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WHAT ARE ACCOUNTING
STANDARDS?

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Accounting standards are authoritative statements of how
particular types o transaction and other events should be
reflected in financial statements. Accordingly, compliance
with accounting standards will normally be necessary for the
fall presentation of financial statements. 

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IS IT MANDATORY?

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A set of financial statements can only be described as
complying with IFRSs if they comply with all existing
IFRSs and IFRICs, plus all exiting IASs and SICs

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IASB has no authority to require compliance with its
accounting standards because it is not a government
institution

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 IF IT IS NOT REALLY
MANDATORY, THEN WHY DO WE
NEED TO ADHERE TO IT?

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Companies and/or securities legislation in many countries requires
management and directors of publicly-traded companies (and, in
many cases, all enterprises) to prepare financial statements in
accordance with IFRS that present fairly (or give a true and fair
view of) the financial position of the enterprise at the end of
the financial year and the results of its operations and cash
flows for the year. 

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THE NEED OF INTERNATIONAL
ACCOUNTING STANDARDS

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At present, financial reports prepared for owners or shareholders and other users
involve principles and procedures that can vary widely from country to country,
and sometimes even within a country. Accounting reports, therefore, can lack
comparability. From the viewpoint of company management, this is highly
unsatisfactory because: 
• It can cause preparation costs for financial reports that are much higher than
necessary
• and businesses will want to have a uniform system for assessing financial
performance in their operations in different countries

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 REASONS WHY PHILIPPINES
ALSO ADAPTED THE
INTERNATIONAL ACCOUNTING
STANDARDS
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 IASB CONCEPTUAL
FRAMEWORK FOR FINANCIAL
REPORTING

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 The objective of the conceptual framework project is to create a
sound foundation for future accounting standards that are principles-
based, internally consistent and internationally converged.

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 The Framework describes the basic concepts that underlie the
preparation and presentation of financial statements for external users.
The Framework serves as a guide to the IASB in developing future
ACCOUNTING STANDARDS and as a guide to resolving accounting issues
that are not addressed directly in an International Accounting Standard
or International Financial Reporting Standard or Interpretation.

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 IASB CONCEPTUAL
FRAMEWORK FOR FINANCIAL
REPORTING

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Framework addresses:
• the objective of financial reporting

• the qualitative characteristics of useful financial information

• the reporting entity

• the definition, recognition and measurement of the elements from which

financial statements are constructed
• concepts of capital and capital maintenance 

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USERS OF THE FINANCIAL
STATEMENTS/FINANCIAL
INFORMATION

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USERS OF FINANCIAL INFORMATION
• Employees

• Customers

• Government and their Agencies

• General Public
• Investors
• Lenders
• Suppliers
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FUNDAMENTAL QUALITATIVE
CHARACTERISTICS

• RELEVANCE
• FAITHFUL
REPRESENTATION

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69
RELEVANCE

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FAITHFUL REPRESENTATION

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ENHANCING QUALITATIVE
CHARACTERISTICS

• COMPARABILITY
• VERIFIABILITY
• TIMELINESS
• UNDERSTANDABILITY

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ENHANCING QUALITATIVE CHARACTERISTICS

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UNDERLYING ASSUMPTION IN
ACCOUNTING

GOING CONCERN
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WHAT ARE THE THINGS NEEDED
FROM ACCOUNTANTS?

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 CORE COMPETENCIES FRAMEWORK FOR ACCOUNTANTS 

In recent years, there has been a growing clamor for professional

bodies and the academe to bridge the gap between the requirements
of the workplace and the academic preparation of our professionals. A
competency-based approach to the preparation of professionals offers
a systematic and effective way of bridging this gap. 
• KNOWLEDGE
• SKILLS
• VALUES
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 KNOWLEDGE

General Knowledge
Organizational and Business Knowledge
Information Technology (IT) Knowledge 
Accounting Knowledge

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 SKILLS

Intellectual 
Interpersonal
Communication

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 VALUES

Professional Ethics
Moral Values

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 CODE OF ETHICS

• INTEGRITY
• OBJECTIVITY
• PROFESSIONAL COMPETENCE AND DUE CARE
• CONFIDENTIALITY
• PROFESSIONAL BEHAVIOR
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BRANCHES OF ACCOUNTING

81
AUDITING

BOOKKEEPING

COST ACCOUNTING

FINANCIAL ACCOUNTING

FINANCIAL MANAGEMENT

MANAGEMENT ACCOUNTING

TAXATION

GOVERNEMENT ACCOUNTING

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CAREER OPPORTUNITIES

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Commerce and Industry
Accountants employed in this area vary widely in their scope of activities
and responsibilities. Sample Entry-level jobs: Financial Accounting and
Reporting Staff, Management Accounting Staff, Tax Accounting Staff,
Internal Audit Staff, Financial Analyst, Budget Analyst, Credit Analyst,
Cost Accountant; Middle-level positions: Comptroller, Senior Information
Systems Auditor, Senior Fraud Examiner, Senior Forensic Auditor;
Advanced positions: Chief Financial Officer, Chief Information Officer. 

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Government Service
Accountants may be hired by the following: Congress of the
Philippines, Commission on Audit (COA), Bureau of Internal
Revenue (BIR), Department of Finance, Department of Budget
and Management, Bangko Sentral ng Pilipinas (BSP) and the
local government units (e.g. provincial, city or municipal
governments). 

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Education/Academe
This area guarantees the continued development of the profession by
endeavoring to clarify and address emerging issues through research
and sharing the results obtained with their colleagues. Considered as
modern day heroes, they make others understand the body of
accounting knowledge. In addition, they painstakingly prepare
candidates for the tough CPA exams. With the advent of information
technology, this sector is being challenged to focus accounting
education from the "transfer of knowledge" approach to the more
effective "learning to learn" approach. 
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QUESTIONS?
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THANK
YOU!
KUYA LUIS
TINAGSA
Email
[email protected]