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Application for Inclusion in the List of Accredited/Selected External Auditors - Individual and Auditing Firm
All corporations with secondary licenses with the Commission shall have independent auditors accredited by the Commission under the appropriate category. The accreditation of independent auditors and auditing firm serves as a quality control mechanism or quality assurance review by the Commission on the work of the accredited external auditors. Said accreditation prescribes higher standard of qualifications and audit quality to ensure reliability and integrity of financial reports being submitted by covered companies.
| Classification: | Highly Technical | ||
| Type of Transaction: | G2C – Government to Citizen G2B – Government to Business |
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| Who may avail: | Auditing Firms Individual practitioners/External Auditors |
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| CHECKLIST OF REQUIREMENTS | WHERE TO SECURE | ||
| INDIVIDUAL | |||
| 1. Fully accomplished application form for external auditor (Application for inclusion in the list of Accredited/Selected External Auditors-Individual) and pre-evaluation notice (1 original, 2 photocopies) | Securities and Exchange Commission official website (https://www.sec.gov.ph/forms-and-fees/accreditation/) (https://www.sec.gov.ph/accountants-information/forms/) |
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| 2. For sole practitioners, Certificate of Registration as public practitioner issued by BOA. For applicant-partners, PRC/BOA Certification containing the list of registered partners of the firm (1 original, 2 photocopies) | Professional Regulation Commission/Board of Accountancy | ||
| 3. Quality Assurance Manual (for sole practitioner) (1 original, 2 photocopies) | Applicant | ||
| 4. Notarized certification that the applicant has fundamental knowledge of the regulatory requirements on each of the secondary licensees of the Commission and compliance with the required 120 CPD units (1 original, 2 photocopies) | Applicant | ||
| 5. Notarized complete list of corporate clients detailing among others the total assets of each (1 original, 2 photocopies) | Applicant | ||
| 6. For initial application, certification from managing partner or signing partner (current and/or former) indicating the detailed participation of the applicant in the audit of the firm’s corporate-clients and various positions held in the firm (1 original, 2 photocopies) | Applicant | ||
| AUDITING FIRM | |||
| 1. Fully accomplished application form for auditing firm (Application for inclusion in the list of Accredited/Selected External Auditors-Auditing Firm) and pre-evaluation notice (1 original, 2 photocopies) | Securities and Exchange Commission official website (https://www.sec.gov.ph/forms-and-fees/accreditation/) (https://www.sec.gov.ph/accountants-information/forms/) |
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| 2. Certificate of Registration issued by BOA to the firm which is current and effective including its registered partners (1 original, 2 photocopies) | Professional Regulation Commission/Board of Accountancy | ||
| 3. Quality Assurance Manual (1 original, 2 photocopies) | Applicant | ||
| 4. Notarized complete list of corporate clients detailing among others the total assets of each (1 original, 2 photocopies) | Applicant | ||
| CLIENT STEPS | AGENCY ACTIONS | FEES TO BE PAID | PROCESSING TIME | PERSON RESPONSIBLE |
| Pre-Evaluation Procedures | ||||
| 1. Secures checklist of requirement from the OGA. | 1. Provides client a checklist of requirements with instructions. | None | 5 minutes | Officer of the day Office of the General Accountant |
| 2. Presents application and supporting documents. | 2. Pre-evaluates and authenticates application and supporting documents. | None | 1 hour | Officer of the day Office of the General Accountant |
| 2.1.1. If application and supporting documents are not complete, the same are returned to applicant with list of requirements not complied with. | ||||
| 2.1.2. If application and supporting documents are complete, the “Officer of the Day” forwards the application to the Executive Assistant. | ||||
| 2.2. Checks contents and stamps and receives the three (3) sets of application document. | 10 minutes | Executive Assistant | ||
| 2.3. Returns one (1) copy of the application document to the client. | ||||
| 2.4. Inputs application to Index Tracking System and forwards the same to the Assistant Director for assignment. | ||||
| 2.5. Selects AFS to be reviewed thru risk based approach from the notarized complete list of clients submitted and forwards documents to assigned personnel with attached copy of completed Pre-Evaluation Sheet. | 3 days | Assistant Director | ||
| 2.5.1. For BSP and/or IC applications: Forwards/Refer to BSP and/or IC applications for accreditation. | ||||
| 2.6. Downloads selected AFS and reviews AFS supporting documents using the OGA’s Evaluation Sheet. | 7 days | Assigned Personnel Office of the General Accountant |
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| 2.7. Prepares comment letters and Memorandum to operating departments to inquire pending case of client-corporations and status of AFS referrals. | 1 hour | Assigned Personnel Office of the General Accountant |
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| 2.8. Reviews comment letter and Memorandum and returns to Assigned Personnel to effect corrections. GO TO STEP 2.7. | 20 minutes | Assistant Director | ||
| 2.8.1. If draft letter/ Memorandum is already acceptable, forwards the same to General Accountant for approval and signature. | ||||
| 2.9. Approves and signs comment letter and Memorandum (applicant will be advised to pay the required processing fee prior to the release of the comment letter). | 20 minutes | General Accountant | ||
| 2.10. Prepares Payment Assessment Form (PAF) and instructs applicant to process payment at Cashier for issuance of official receipt. | 10 minutes | Executive Assistant | ||
| 3. Presents the PAF at the Cashier and settles the required fee. | 3. Processes payment and issues O.R. |
SEC ACCREDITATION Auditing Firm Group B Group C Annual Fee** Group B – PHP2,000.00 per accredited partner + PHP15,000.00 for the firm Group C – PHP1,500.00 per accredited partner + PHP5,000.00 for the firm Individual Applicant-Practitioner Group B Group C Annual Fee** Documentary Stamp PHP 30.00/application BSP ACCREDITATION Auditing Firm External Auditor IC ACCREDITATION Auditing Firm External Auditor * Legal Research Fee is equivalent to 1% of the Filing Fee but not less than PHP10.00. ** Deferred until further notice |
10 minutes *Subject to the prescribed processing of the Cashier Treasury Division, FMD |
Teller Financial Management Department (FMD) |
| 4. Presents the PAF at the Cashier and settles the required fee. | 4. Forwards the PAF to the Assigned Personnel. | None | 5 minutes | Executive Assistant Office of the General Accountant |
| Processing Procedures | ||||
| 5. Submits letter explanation on noted findings in receiving department. | 5. Acknowledges receipt of letter explanation and forwards the same to the Assistant Director for assignment. | None | 10 minutes | Executive Assistant Office of the General Accountant |
| 5.1. Forwards documents to assigned personnel with attached copy of completed Pre-Evaluation Sheet for evaluation. | 10 minutes | Assistant Director Office of the General Accountant |
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| 5.2. If no compliance is made within the prescribed period or compliance is not fully compliant with the requirements: | ||||
| 5.2.1. Prepares a letter denying the application for failure to comply with the requirements. | 1 day | Assigned Personnel Office of the General Accountant |
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| 5.2.2. Reviews letter and returns to Assigned Personnel to effect corrections. | 20 minutes | Assistant Director Office of the General Accountant |
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| 5.2.3. If draft letter is already acceptable, forwards the same to General Accountant for approval and signature. | ||||
| 5.3. If applicant meets threshold to qualify for accreditation but has noted material findings in the reviewed clients’ AFS: | ||||
| 5.3.1. Prepares an assessment letter and/or directive to submit amended AFS. | 2 days | Assigned Personnel Office of the General Accountant |
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| 5.3.2. Reviews letter and returns to Assigned Personnel to effect corrections. | 20 minutes | Assistant Director Office of the General Accountant |
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| 5.3.3. If draft letter is already acceptable, forwards the same to General Accountant for approval and signature. | ||||
| 5.4. Approves and signs letter. | 20 minutes | General Accountant | ||
| 5.5. Prepares letter for mailing. | 20 minutes | Index Tracking Personnel Office of the General Accountant |
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| 6. Presents assessment letter. | 6. Prepares Payment Assessment Form (PAF) for penalty and instructs applicant to process payment for penalty at the Cashier for issuance of official receipt. | The assessed penalty is based on SEC MC Nos. 8 and 13/ Revised SRC Rule 68. | 10 minutes | Executive Assistant Office of the General Accountant |
| 7. Presents the PAF at the Cashier and settles the required penalty | 7. Processes payment and issues O.R. | None |
10 minutes *Subject to the prescribed processing of the Cashier Treasury Division, FMD |
Teller Financial Management Department (FMD) |
| 8. Submits the machine- validated PAF to OGA | 8. Records penalty collected and forwards PAF to Assistant Director. | None | 5 minutes | Executive Assistant Office of the General Accountant |
| 8.1. Forwards documents to assigned personnel to form part of application documents | 5 minutes | Assistant Director Office of the General Accountant |
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| 8.2. If applicant fully complies with the requirements and the operating departments have already provided a Memo-reply: | 3 days | Assigned Personnel Office of the General Accountant |
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| 8.2.1. For Group A/B, prepares Memorandum to Commission En Banc, Evaluation Sheet and other supporting documents, i.e., working paper, matrix of findings, google searches on top ten (10) clients for any pending case/issues on them including the concurrence of BSP and/or IC on their approval/denial of the applications (through Supervising Com- missioner) then GO TO STEP 8.3, 8.4 and 8.7. | ||||
| 8.2.2. For Group C, finalizes evaluation sheet and other supporting documents, i.e., working paper, matrix of findings, google searches on reviewed client-corporations for any pending case/issues on them including the concurrence of BSP and/or IC on their approval/denial of the applications for submission to General Accountant, then GO TO STEP 8.5, 8.6 and 8.7. | ||||
| 8.3. Reviews Memorandum, Evaluation Sheets and other supporting documents and returns to Assigned Personnel to effect corrections. | 20 minutes | Assistant Director | ||
| 8.3.1. If Memorandum and other documents are already acceptable, forwards the same to General Accountant for approval and signature. | ||||
| 8.4. Approves and signs Memorandum, Evaluation Sheets and other supporting documents. Forwards application folder to Supervising Commissioner for approval/clearance for presentation to Commission en Banc. | 20 minutes | General Accountant | ||
| 8.5. Reviews Evaluation Sheets and other supporting documents and returns to Assigned Personnel to effect corrections. | 20 minutes | Assistant Director | ||
| 8.5.1. If Evaluation Sheet and other documents are already acceptable, forwards the same to General Accountant for approval and signature | ||||
| 8.6. Approves and signs Evaluation Sheets and other supporting documents. Forwards the same to the Supervising Commissioner for final approval. | 20 minutes | General Accountant | ||
| 8.7. Reviews Memorandum/ Evaluation Sheet and other documents. | 2 days | Supervising Commissioner Office of the Supervising Commissioner |
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| 8.7.1. For Group A/B, if application is already acceptable, signs document for presentation by General Accountant to Commission En Banc. | ||||
| 8.7.2. For Group C, if application is already acceptable, signs Evaluation Sheet and returns application folder to OGA for preparation of certificate (GO TO STEP 9). | ||||
| 8.8. Presents Memorandum to the Commission En Banc for consideration (after clearance from Supervising Commissioner). | 50 minutes | General Accountant | ||
| 8.9. Receives advice of the resolution of the Commission En Banc on the application. | 1 day | Assigned Personnel | ||
| 8.9.1. If approved, GO TO STEP 9. | ||||
| 8.9.2. If denied/ deferred: | ||||
| 8.9.2.1. Denial: Notifies the applicant of the denial and reasons thereof. | ||||
| 8.9.2.2. Deferment: Notifies the applicant of the deferment and requirement to be complied with or necessary action to correct the deficiency. | ||||
| 8.10. Reviews letter and returns to Assigned Personnel to effect corrections | 20 minutes | Assistant Director | ||
| 8.10.1. If draft letter is already acceptable, forwards the same to General Accountant for approval and signature. | ||||
| 8.11. Approves and signs letter. | 20 minutes | General Accountant | ||
| 8.12. Prepares letter for mailing. | 20 minutes | Index Tracking Personnel Office of the General Accountant |
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| 9. Presents authority to receive the certificate | 9. Prepares Certificates of Accreditation: | None | ||
| 9.1. Prints two (2) copies | 10 minutes | Executive Assistant Office of the General Accountant |
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| 9.2. Checks details and Initials on copies | 5 minutes | Assigned Personnel Office of the General Accountant |
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| 9.3. Checks details and Initials on copies | 5 minutes | Assistant Director | ||
| 9.4. Signs certificates | 5 minutes | General Accountant | ||
| 9.5. Notifies applicant that the Certificate may be picked up (in case of representative, subject to presentation of authorization letter) | 5 minutes | Executive Assistant | ||
| 9.6. Releases Certificate of accreditation and forwards duplicate file to clerk | 10 minutes | Executive Assistant | ||
| 9.7. Logs in registry of Accredited Appraisal Companies; informs Index Tracking Personnel of the issuance of the certificate. | 10 minutes | Executive Assistant | ||
| 9.8. Provides MIS with updated list | 30 minutes | Executive Assistant | ||
| 9.9. Updates tracking system | 30 minutes | Index Tracking Personnel Office of the General Accountant |
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SEC ACCREDITATION Auditing Firm Group B Group C Annual Fee** Group B – PHP2,000.00 per accredited partner + PHP15,000.00 for the firm Group C – PHP1,500.00 per accredited partner + PHP5,000.00 for the firm Individual Applicant-Practitioner Group B Group C Annual Fee** Documentary Stamp PHP30.00/applicationBSP ACCREDITATION Auditing Firm External Auditor Auditing Firm External Auditor * Legal Research Fee is equivalent to 1% of the Filing Fee but not less than PHP10.00. ** Deferred until further notice |
20 days | |||
Notes:
● Processing time is exclusive of time allotted for the AFS evaluation and response period from first comment letter. The above processing time commences upon actual receipt of letter explanation from the applicant on the noted findings on the AFS evaluation.
● The above processing time only includes the period of time wherein the application is within the Office of the General Accountant. It likewise excludes extensions, requirements to amend the audited financial statements, additional procedures/documents that the Supervising Commissioner/Commission en banc may require as deemed necessary and period of time to receive the concurrence of BSP and/or IC on the approval/denial of the applications.
● Additional processing time of 20 days shall be added from the total processing time if the assigned personnel requested supplemental information due to insufficiency of the applicant’s explanation on noted findings. Such supplemental shall be requested before the original processing time lapse.
● The Commission may either grant a five (5) audit year SEC accreditation or a conditional accreditation for a period of one (1) audit year subject to the result of the review. The applicant may only avail or be granted conditional accreditation on the same level up to three (3) times only.
● In the event that the application is denied due to applicant’s failure to meet the required audit quality, such applicant can only re-apply for accreditation after six (6) months from said denial for the same category.
● Existing accredited external auditors under Group A & B can only apply for upgrading after one (1) year from the grant of their accreditation.