Draft Proposal for Accreditation of External Auditor_0

7/23/2019 Draft Proposal for Accreditation of External Auditor_0

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DR FT PROPOS L FOR THER FT PROPOS L FOR THE

CCREDIT TION OF

CCREDIT TION OF

EXTERN L UDITORXTERN L UDITOR


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EVERY COOPERATIVE SHALL DRAW

UP AN ANNUAL REPORT OF ITS

AFFAIRS AS OF THE END OF EVERY

FISCAL YEAR WHICH INCLUDE

FINANCIAL REPORTS


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ANNUAL SUBMISSION OF FINANCIAL

STATEMENTS, DULY AUDITED BY

A CERTIFIED PUBLIC ACCOUNTANT


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ARTICLE 81 RA 6938

COOPERATIVE UNDER THIS CODE SHALL

BE SUBJECTED TO ANNUAL AUDIT BY AN

AUDITOR WHO SATISFIES ALL THEFOLLOWING QUALIFICATIONS:

(1) HE IS INDEPENDENT OF THE

COOPERATIVE BEING AUDITEDAND ANY SUBSIDIARY OF THE COOP

(2) HE IS A MEMBER OF ANY RECOGNIZEDPROFESSIONAL ACCOUNTING OR

COOPERATIVE AUDITORS ASSOCIATION

WITH SIMILAR QUALIFICATIONS


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DEVELOPMENT OF STANDARD

AUDIT SYSTEM FOR COOPERATIVES

TO ENCOURAGE PRACTIONER TO TAKE

A LOOK AT COOPERATIVES AS ENTITIES

REQUIRING THEIR SERVICES

TO FAMILIARIZE PRACTIONERS ON THE

PECULIARITIES OF COOPERATIVES

TOOL TO GUIDE AUDITOR AND COOPSIN THEIR AUDITING WORK


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CDA MEMORANDUM CIRCULAR 2000-06

FULL IMPLEMENTATION OF THE STANDARDAUDIT SYSTEM FOR COOPERATIVES BY END

OF FISCAL YEAR 2002

MEMORANDUM CIRCULAR 2000-07

ORGANIZATION, COMPOSITION AND

FUNCTION OF THE COOPERATIVE

EXTERNAL AUDITORS RECOGNITIONBOARD


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MEMORANDUM CIRCULAR 2003-03

RULES AND REGULATIONS IMPLEMENTING

CDA MEMORANDUM CIRCULAR NO. 2000-07,ESTABLISHING THE COOPERATIVE EXTERNAL

AUDITORS RECOGNITION BOARD IN EVERY

CDA EXTENSION OFFICES

IMPLEMENTED FROM JUNE 2003 TO MARCH 2005


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PARALLEL INITIATIVES UNDERTAKEN DEVELOPMENT OF THE STANDARD

CHART OF ACCOUNTS FOR CREDIT

COOPERATIVES AND OTHER TYPES

WITH LENDING OPERATION

DEVELOPMENT OF PERFORMANCESTANDARDS FOR CREDIT AND

OTHER TYPE WITH CREDIT SERVICES

DEVELOPMENT OF STANDARD CHARTOF ACCOUNTS FOR OTHER TYPES

OF COOPERATIVES


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MANUAL OF RULES AND REGULATION

FOR CREDIT AND OTHER TYPE OFCOOPERATIVES WITH CREDIT

SERVICES


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PROVISIONS IN THE MANUAL OF RULES

REGULATIONS, PERTAINING TO

EXTERNAL AUDITOR

SCCs SHALL ENGAGE THE SERVICES OF AN

INDEPENDENT CERTIFIED PUBLICACCOUNTANT DULY RECOGNIZED/

ACCREDITED BY THE CDA TO AUDIT THEIR

BOOKS OF ACCOUNT AT LEAST ONCE AYEAR


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THE SAME INDIVIDUAL EXTERNAL AUDITOR,

WHETHER ON HIS INDIVIDUAL CAPACITY ORAS PARTNER OF A FIRM, SHALL NOT UNDER-

TAKE THE EXTERNAL AUDIT OF THE CONCERN

COOPERATIVE FOR MORE THAN THREE (3)CONSECUTIVE YEARS

A SCCs SHALL NOT ENGAGE THE SERVICES OF

AN EXTERNAL AUDITOR WHOSE PARTNER OR

AUDITOR-IN-CHARGE OF THE AUDIT ENGAGEMENT

DURING THE PRECEDING YEAR HAS BEEN HIRED

OR EMPLOYED BY THE COOPERATIVE AS CEO,

CHIEF FINANCIAL OFFICER, CHIEF ACCOUNTING

OFFICER OR ANY POSITION OF EQUIVALENT RANK


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IT SHALL NOT ALSO ENGAGE THE SERVICES OF

AN EXTERNAL AUDITOR WHO IS A MEMBER,

OFFICER OF THE SCC TO WHICH HE BELONGS

TO OR OF ANY FEDERATION/UNION TO WHICH

THE SCC IS AFFILIATED

THE EXTERNAL AUDITOR SHALL NOT BE RELATED

TO ANY OFFICER AND EMPLOYEE OF THE SCCs UP

TO THE FOURTH DEGREE OF CONSANGUINITY OR

AFFINITY


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WHEN WARRANTED, THE AUTHORITY MAY,

AT THE EXPENSE OF THE SCC REQUIRE THE

EXTERNAL AUDITOR TO UNDERTAKE A

SPECIFIC REVIEW OF A PARTICULAR ASPECTOF THE OPERATIONS OF THE SCC. THE

REPORT SHALL BE SUBMITTED TO THE

AUTHORITY AND TO THE SCC SIMULTANEOUSLY,WITHIN THIRTY (30) CALENDAR DAYS AFTER

THE CONCLUSION OF THE REVIEW


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DISCLOSURE OF EXTERNAL AUDITORS

FINDINGS

WITHIN THIRTY (30) CALENDAR DAYS AFTER

DISCOVERY OF THE FOLLOWING:

ANY MATERIAL FINDINGS INVOLVING

FRAUD OR DISHONESTY (INCLUDINGCASES THAT WERE RESOLVED DURING

THE PERIOD OF AUDIT)

ANY POTENTIAL LOSSES THEAGGREGATE OF WHICH AMOUNTS TO

AT LEAST ONE PERCENT (1%) OF THE

PAID-UP SHARE CAPITAL


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INABILITY OF THE AUDITOR TO

CONFIRM THAT THE CLAIMS OFTHE CREDITORS CAN STILL BE

COVERED BY THE SCCS ASSETS


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WITHIN FIFTEEN (15) CALENDAR DAYS OF THEOCCURRENCE OF THE FOLLOWING:

TERMINATION OR RESIGNATION ASEXTERNAL AUDITOR, PRIOR TO THE

EXPIRATION OF THE CONTRACT,

STATING THE REASON THEREOF

DISCOVERY OF A MATERIAL BREACH OF

COOPERATIVE LAWS OR THE RULES AND

REGULATIONS SUCH AS, BUT NOT

LIMITED TO:


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1. NET WORTH TO RISK ASSET RATIO

2. LOANS AND OTHER RISK ASSETS

REVIEW AND CLASSIFICATIONUSING PORTFOLIO AT RISK

3. FINDINGS ON MATTERS OFCOOPERATIVE GOVERNANCE THAT

MAY REQUIRE URGENT ACTION

BY THE AUTHORITY


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PROPOSED CRITERI

IN THE SELECTION OF

EXTERN L UDITORS

ND INCLUSION IN THE CD LIST


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Statement of Policy

It is the policy of the CDA to promote

high ethical and professional standardsin public accounting practice and to

encourage coordination and sharing ofinformation between external auditors and

the Authority to ensure effective

supervision of cooperativesand to avoid unnecessary duplication

of efforts.


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In furtherance of this policy and to ensure

that reliance by regulatory authorities and

the public on the opinion of externalauditors is well placed, the following

rules and regulations shall govern theselection, appointment, and delisting

for external auditors of cooperatives


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pplication Requirements

All applicants for accreditation shallsubmit the following documents

to the Authority:


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1. For Individual CPAs

WRITTEN APPLICATION ADDRESS TO

THE EXTERNAL AUDITOR RECOGNITION

BOARD AT THE EXTENSION OFFICES OFCDA WHERE SUCH CPA IS BASED, WITH

THE FOLLOWING :

A CERTIFIED TRUE COPY OF CURRENT

PROFESSIONAL LICENSE ISSUED BY

THE PROFESSIONAL REGUATORYCOMMISSION (PRC)


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CERTIFIED TRUE COPY OF THE CERTIFICATE

OF REGISTRATION WITH PRC/BOARD OFACCOUNTANCY (BOA)

CERTIFIED TRUE COPY OF CURRENTPRIVILEGE TAX RECEIPT (PTR) ISSUED

BY THE LOCAL GOVERNMENT WHERE

HE RESIDES

CERTIFIED TRUE COPY OF THE CERTIFICATE

OF MEMBERSHIP IN GOOD STANDING WITHHIS PICPA CHAPTER


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CERTIFIED TRUE COPY OF CERTIFICATE

OF COMPLETION OF TRAINING ON THE

SASC OR FIVE YEARS EXPERIENCE INCOOPERATIVE AUDIT USING SASC

CERTIFIED TRUE COPY OF CERTIFICATE OF

TRAININGS CREDITED FOR SIXTEEN (16)HOURS FOR EVERY THREE (3) YEARS ON

COURSES/TOPICS RELEVANT TO

COOPERATIVE OPERATION


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For partnership / FIRMS

CERTIFIED TRUE COPY OF THE FIRM/

PARTNERSHIP CERTIFICATE OF

REGISTRATION WITH THE PRC/BOA

CERTIFICATION THAT AT LEAST ONE (1)PARTNER HAVE THE REQUIRED TRAINING

ON SASC AND REPRESENTS THE

PARTNERSHIP WITH REGARDS TO THE

AUDIT REPORTS FOR COOPERATIVES


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LIST OF AUDIT STAFF INVOLVED IN

COOPERATIVE AUDIT

CERTIFIED TRUE COPY OF THE CURRENT

PROFESSIONAL LICENSE ISSUED BY THE

PRC FOR THE PARTNER/AUDIT SUPER-

VISOR IN CHARGE OF COOPERATIVE

AUDIT


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CERTIFIED TRUE COPY OF CURRENT

PRIVILEGE TAX RECEIPT OF THE FIRM/PARTNERSHIP ISSUED BY THE LOCAL

GOVERNMENT

CERTIFIED TRUE COPY OF CERTIFICATE OF

TRAININGS CREDITED FOR SIXTEEN (16)

HOURS FOR EVERY THREE (3) YEARS ONCOURSES/TOPICS RELEVANT TO

COOPERATIVE OPERATION


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PROCESSING FEE

INDIVIDUAL P 1,000.00

PARTNERSHIP/FIRM 5,000.00


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THANK YOU

Documents

Draft Proposal for Accreditation of External Auditor_0