BIR and accountants

Unknown except for the top bracket of the country corporate structure, a crisis has been brewing these past few weeks between the government and the country’s accountants on the professional tax.

The culprit is a recent revenue memorandum order issued by BIR Commissioner Kim Henares that would require accountants and the accounting firms to submit to the BIR all the contracts of their clients with other firms.

The second point is that all accountants are now required to submit to the BIR their original Income Tax Returns. Not the copies but the original itself.

The talk among the country’s accountants is that the situation may end with only regular bookkeepers authorized or accredited later to submit reports and papers to the BIR and not the country’s accountants.

One accountant, interviewed by this writer, considered the Henares RMD unprecedented and oppressive as well as counter-productive.

Take the case of the accountants submitting to the BIR all the contracts between their clients and outside interest. That had never been done before. Besides there is the dubious question of ethical standards being violated.

In short, if all the contracts have to be submitted to the BIR before they are acted upon, that could mean a major problem for both parties – the accountants in accounting firms and the BIR.

And why? Does this mean that BIR must first go over the contracts before they are approved?

And what is the intent of the submission of the original ITR by the accountants? Does it mean that the BIR no longer trust the accountants and their accounting firms?

In short, with such restrictions to their rights and powers, what is going to happen soon will be that only the bookkeepers would be able to be accepted by the BIR to practice as accountants.

That means the bulk of the country’s accountants will no longer be accredited by the government when they are granted such accreditation by the Professional Regulations Commission.

That was the situation as of the weekend. And there have been questions on the BIR’s move with no concrete resolution yet offered to solve the impasse.

But some of the country’s top accountancy firms are reportedly supposed to meet Henares to thresh out the details of her revenue memorandum order and its provisions.

Meanwhile, the clients of these accountants and accountancy offices are just virtually unaware of the serious threats to their accountants and themselves.

If things are not properly addressed, soon we may have only bookkeepers authorized by the BIR to submit reports to the government agency and not one of the country’s PRC-authorized professionals.*

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