BIR Ruling No. 173-61

May 18, 1961 BIR RULING NO. 173-61 Messrs. Sycip, Gorres, Velayo & Co. Certified Public Accountants P. O. Box 589, Manila Gentlemen : With reference to your letter dated May 13, 1960, as supplemented by that dated September 24, 1960, relative to the question of independence of certified public accountants, I have the honor to inform you that, after a study of the matter and as approved by the Secretary of Finance, B.I.R. Ruling No. 130 (s. 1960) is hereby modified as follows: LLpr 1. An accountant may not audit the books of a taxpayer in which a member of his family, consisting of his spouse, descendants, ascendants, and brothers and sisters living in the family home and dependent upon him for support, owns more than 10% of the capital paid or committed to be acquired. 2. An accountant may not audit and certify the financial statements of a company controlled and/or owned by his family consisting of his spouse, descendants, ascendants, and brothers, and sisters living in the family home and dependent upon him for support. 3. An accountant may not audit the books of a company of which an immediate member of his family (spouse or child living with him) is either president, manager or director. 4. An accountant is not independent if he keeps the books of accounts as an independent certified public accountant and then certifies the financial statements drawn from the same books kept by him. 5. An accountant may not be retained as an external auditor of a company and at the same time its stock and transfer agent. prll Very truly yours, (SGD.) MELECIO R. DOMINGO Commissioner of Internal Revenue By: (SGD.) MISAEL P. VERA Deputy Commissioner of Internal Revenue