This report is an update assessment of accounting and auditing practices in the Philippines as a continuation of the joint initiative of the World Bank and the International Monetary Fund (IMF) to prepare Reports on the Observance of Standards and Codes (ROSC). The assessment focuses on the strengths and weaknesses of the accounting and auditing environment that influence the quality of corporate financial reporting for private sector entities. It involves a review of both mandatory requirements and actual practices. It uses International Financial Reporting Standards (IFRS) and International Standards on Auditing (ISA) as benchmarks, and draws on international experience and good practices in the field of accounting and audit regulation. This ROSC accounting and auditing report sketches policy recommendations to enhance the quality of corporate financial reporting and seeks to foster a financial reporting platform conducive to increased tax collection, private sector growth, foreign direct investment and reduced financial system instability. This ROSC does not include in its scope accounting and auditing matters affecting public sector entities. Under the Philippine Constitution, it is the Commission on Audit, the Philippines' Supreme State Audit Institution, that has the exclusive authority to promulgate accounting and auditing rules applicable to public sector entities, including government-owned and controlled corporations.
