Draft Proposal for Accreditation of External Auditor_0
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Transcript of 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