Non-audit and Examination Pawnshop's Books of Accounts

February 20, 1958 BIR RULING NO. 112-58 Mr. Felipe A. David 1036 Rizal Avenue Manila S i r : In answer to your letter of the 17th ultimo, I have the honor to inform you that, pursuant to Section 334 of the National Internal Revenue Code, in relation to Section 8-A of Revenue Regulations No. V-1, only corporations, companies, partnerships, or persons whose gross quarterly sales, receipts, or output exceed P25,000.00 are required, among other things, to have their books of accounts audited and examined by independent certified public accountants. Accordingly, and as loans given by pawnshops are not embraced within the meaning of "sales, earnings, receipts, or output", you need not, as pawnshop owner, have your books of accounts audited and examined by an independent certified public accountant even if the total amount of the loans given by you during any quarter of a given year exceeded P25,000.00 However, it may be stated that, should the amount of interest realized by you from your loans, plus the amount of your sales of unredeemed jewelries minus the amount for which they were pawned, and al other income, earnings or receipts derived by you from your operations exceed P25,000.00 during any given quarter, you must have your books of accounts audited and examined in accordance with the aforesaid law and regulations. Very truly yours, (SGD.) JOSE ARAAS Commissioner of Internal Revenue