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April 23, 2025
Home » How to File Audited Financial Statements with the SEC in the Philippines

In the Philippines, submitting audited financial statements to the Securities and Exchange Commission (SEC) is a cornerstone of corporate compliance, ensuring financial transparency and business accountability. Governed by stringent regulations, this process demands meticulous preparation, professional certification, and adherence to the SEC and the Bureau of Internal Revenue (BIR) deadlines. This article offers a detailed roadmap for businesses to successfully submit audited financial statements in the Philippines, covering essential steps, regulatory requirements, and best practices. Tailored for Philippine-based companies, it highlights the significance of financial statement audits and the pivotal role of expert services like BusinessRegistrationPhilippines.com in simplifying this intricate obligation.

Defining Audited Financial Statements and Their Importance

Audited financial statements are comprehensive reports that detail a company’s financial performance, position, and cash flows, independently verified by a certified public accountant (CPA) to ensure accuracy and compliance with regulatory standards. In the Philippines, these statements are mandatory for certain entities to uphold transparency, protect stakeholders, and maintain confidence in financial markets. Governed by the Revised Securities Regulation Code (SRC) Rule 68 and the National Internal Revenue Code (NIRC), the requirement underscores the need for businesses to grasp their scope and purpose to achieve compliance.

  • Components and Structure: These statements encompass the balance sheet, income statement, cash flow statement, and statement of changes in equity, supplemented by detailed notes and an auditor’s report. They provide a clear picture of a company’s financial standing.
  • Regulatory Requirements: The SEC mandates audited financial statements for stock and non-stock corporations with assets or liabilities of PHP 600,000 or more and foreign branches with assets or revenues exceeding PHP 1,000,000. The BIR requires them for entities with gross annual sales above PHP 3,000,000.
  • Objective of Audits: Audits verify the absence of material misstatements, enhancing the reliability of financial data for investors, creditors, and regulators while helping to identify fraud.
  • Building Stakeholder Confidence: Certified financial statements demonstrate a company’s commitment to accountability, strengthening trust among shareholders, lenders, and other parties.
  • Consequences of Non-Compliance: Failure to file audited financial statements can lead to SEC penalties, fines, or rejection of submissions, potentially disrupting operations.

Who Is Responsible for Preparing Audited Financial Statements?

Preparing audited financial statements in the Philippines involves collaboration between a company’s internal accounting team and an independent, SEC-accredited CPA. The CPA conducts a financial statement audit to ensure compliance with Philippine Financial Reporting Standards (PFRS) and Philippine Standards on Auditing (PSAs). The SEC and BIR enforce strict criteria for auditors, emphasizing the importance of expertise and proper credentials. Selecting a qualified auditor is critical to avoid compliance issues.

  • Company’s Role: The internal accounting team compiles financial records, including ledgers, invoices, and transaction logs, ensuring they are complete and accurate for audit preparation.
  • CPA’s Responsibilities: An accredited CPA examines the financial data, performs audit tests (e.g., reconciliations, third-party verifications), and issues a report certifying the statements’ accuracy.
  • Auditor Qualifications: Auditors must be accredited by the Board of Accountancy (BOA) and, for SEC submissions, by the SEC. Specialized industries like banking may require additional certifications from bodies like the Bangko Sentral ng Pilipinas (BSP).
  • Independence Requirement: To ensure objective reporting, the CPA must maintain impartiality and be free from financial or personal connections to the company.
  • Risks of Non-Compliance: Statements signed by non-accredited auditors may be rejected, resulting in fines or delays in SEC filings.

Why Audits Are Essential for Financial Statements

Audits of financial statements are conducted to confirm their accuracy, ensure regulatory compliance, and enhance their credibility for stakeholders. In the Philippines, audits are a key component of corporate governance, mandated to protect investors and maintain the financial system’s integrity. Beyond meeting legal requirements, audits provide strategic advantages, such as identifying operational inefficiencies and strengthening financial controls. Companies that invest in thorough audits often gain a competitive edge in securing funding and partnerships.

  • Verifying Accuracy: Audits identify errors, discrepancies, or fraudulent entries, ensuring financial statements accurately reflect the company’s performance.
  • Ensuring Compliance: Audits confirm adherence to PFRS, PSAs, and SEC/BIR regulations, minimizing the risk of penalties or legal challenges.
  • Boosting Trust: Audited statements are more credible to banks, investors, and regulators, facilitating access to loans, investments, or business opportunities.
  • Strengthening Controls: Auditors often suggest improvements to accounting systems, enhancing financial management and risk mitigation.
  • Supporting Strategy: Accurate financial data from audits enables management to make informed decisions about growth, budgeting, or cost optimization.

When Are Audited Financial Statements Mandatory?

The obligation to submit audited financial statements in the Philippines hinges on thresholds defined by the SEC and BIR and the company’s fiscal year. Timely filing is required to avoid penalties, with deadlines varying based on the company’s SEC registration number, fiscal year-end, and whether it is publicly listed. Businesses must align their audit and filing schedules to meet these requirements, primarily through the SEC’s Electronic Filing and Submission Tool (eFAST).

  • SEC Criteria: Stock and non-stock corporations with assets or liabilities of PHP 600,000 or more and foreign branches with assets or revenues of PHP 1,000,000 or more must file audited financial statements annually.
  • BIR Criteria: Entities with gross annual sales, earnings, or receipts exceeding PHP 3,000,000 must include audited financial statements with their Annual Income Tax Return (AITR).
  • Deadlines for Calendar Year-End: The BIR deadline for fiscal years ending December 31 is April 15 of the following year. The SEC employs a staggered schedule based on the SEC registration number, typically beginning in April.
  • Non-Calendar Year-End: Companies with different fiscal year-ends must submit within 120 days from the fiscal year-end for SEC filings or by the 15th day of the fourth month for BIR submissions.
  • Publicly Listed Entities: Companies listed on the Philippine Stock Exchange (PSE) or under Section 17.2 of the SRC must file within 105 days after their fiscal year-end, attached to SEC Form 17-A.
  • Exemptions and Late Filings: Entities audited by the Commission on Audit (COA) may have adjusted deadlines with proper documentation. Late SEC filings are accepted from July 8, with penalties based on the original due date.

Steps to Prepare Audited Financial Statements for SEC Filing

Preparing audited financial statements for SEC submission requires careful planning, collaboration with an accredited CPA, and adherence to PFRS. The process involves compiling financial data, conducting the audit, securing certifications, and filing through the SEC’s eFAST platform. Given the technical nature of the task, businesses must maintain robust bookkeeping and engage professionals to ensure accuracy. The following steps guide companies through the preparation process.

  • Keep Detailed Records: Record all financial transactions throughout the fiscal year, including revenues, expenses, and liabilities, by PFRS. Accounting software can streamline this process.
  • Hire an Accredited CPA: Select a CPA accredited by the BOA and SEC to audit the financial statement. Verify their credentials to ensure compliance.
  • Draft Financial Statements: Prepare the balance sheet, income statement, cash flow statement, and statement of changes in equity, including comprehensive notes on key financial items.
  • Facilitate the Audit: The CPA conducts audit procedures, such as document reviews and third-party confirmations, to validate the financial statements. Management should review and approve any adjustments.
  • Obtain Certifications: Secure a Statement of Management’s Responsibility (SMR) signed by authorized officers, confirming the statements’ accuracy. The CPA provides an audit report.
  • Include Supporting Documents: Attach required SEC disclosures, such as equity and retained earnings details, and the general form for financial statements per Revised SRC Rule 68.
  • File with BIR First: Ensure the audited financial statements are stamped “received” by the BIR or include a Transaction Reference Number from the e-AFS system before SEC submission.
  • Submit via eFAST: Register on the SEC’s eFAST platform, upload the audited financial statements and supporting documents, and file within the deadline. Physical submissions are no longer accepted.

Overcoming Challenges in SEC Submission with Professional Support

Submitting audited financial statements to the SEC is complex, with challenges ranging from regulatory nuances to tight deadlines. Errors in preparation, non-compliance with PFRS, or using non-accredited auditors can lead to rejections, penalties, or operational delays. Given these hurdles, professional assistance from BusinessRegistrationPhilippines.com is invaluable for ensuring compliance and efficiency. As a trusted provider in the Philippines, BusinessRegistrationPhilippines.com offers expert services to navigate this intricate process seamlessly.

  • Navigating Regulations: The SEC and BIR impose specific requirements, such as unique disclosures and certifications, which can be challenging without specialized knowledge.
  • Meeting Deadlines: Staggered SEC schedules and BIR deadlines demand precise coordination, particularly for companies with complex transactions or non-standard fiscal years.
  • Auditor Accreditation Issues: Using a non-accredited CPA can result in rejected filings, necessitating costly corrections and delays.
  • Avoiding Errors: Incomplete disclosures, formatting issues, or inaccurate data can lead to SEC rejections, requiring time-consuming revisions.
  • Resource Limitations: Small and medium enterprises (SMEs) often lack the expertise or staff to effectively manage audited financial statement preparation.
  • Why BusinessRegistrationPhilippines.com: Accessible via its website, BusinessRegistrationPhilippines.com provides tailored accounting and compliance services, ensuring accurate preparation and timely SEC and BIR filings. Their experienced CPAs simplify the process, reducing risks and saving businesses valuable time.

Wrapping Up

Submitting audited financial statements to the SEC in the Philippines is a critical task that requires precision, expertise, and strict adherence to regulatory standards. By understanding the process, engaging qualified auditors, and leveraging professional support, businesses can confidently meet their compliance obligations. The benefits of proper submission extend beyond avoiding penalties, enhancing credibility, and building stakeholder trust. Expert assistance is necessary for companies aiming to streamline their annual financial statement filings in the Philippines.

Is Assistance Available? 

Yes, BusinessRegistrationPhilippines.com, a trusted provider of compliance and accounting services, can guide your business through the complexities of audited financial statement submission. Reach out today to schedule an initial consultation with one of our experts. 

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In the Philippines, submitting audited financial statements to the Securities and Exchange Commission (SEC) is a cornerstone of corporate compliance, ensuring financial transparency and business accountability. Governed by stringent regulations, this process demands meticulous preparation, professional certification, and adherence to the SEC and the Bureau of Internal Revenue (BIR) deadlines. This article offers a detailed roadmap for businesses to successfully submit audited financial statements in the Philippines, covering essential steps, regulatory requirements, and best practices. Tailored for Philippine-based companies, it highlights the significance of financial statement audits and the pivotal role of expert services like BusinessRegistrationPhilippines.com in simplifying this intricate obligation.

Defining Audited Financial Statements and Their Importance

Audited financial statements are comprehensive reports that detail a company’s financial performance, position, and cash flows, independently verified by a certified public accountant (CPA) to ensure accuracy and compliance with regulatory standards. In the Philippines, these statements are mandatory for certain entities to uphold transparency, protect stakeholders, and maintain confidence in financial markets. Governed by the Revised Securities Regulation Code (SRC) Rule 68 and the National Internal Revenue Code (NIRC), the requirement underscores the need for businesses to grasp their scope and purpose to achieve compliance.

  • Components and Structure: These statements encompass the balance sheet, income statement, cash flow statement, and statement of changes in equity, supplemented by detailed notes and an auditor’s report. They provide a clear picture of a company’s financial standing.
  • Regulatory Requirements: The SEC mandates audited financial statements for stock and non-stock corporations with assets or liabilities of PHP 600,000 or more and foreign branches with assets or revenues exceeding PHP 1,000,000. The BIR requires them for entities with gross annual sales above PHP 3,000,000.
  • Objective of Audits: Audits verify the absence of material misstatements, enhancing the reliability of financial data for investors, creditors, and regulators while helping to identify fraud.
  • Building Stakeholder Confidence: Certified financial statements demonstrate a company’s commitment to accountability, strengthening trust among shareholders, lenders, and other parties.
  • Consequences of Non-Compliance: Failure to file audited financial statements can lead to SEC penalties, fines, or rejection of submissions, potentially disrupting operations.

Who Is Responsible for Preparing Audited Financial Statements?

Preparing audited financial statements in the Philippines involves collaboration between a company’s internal accounting team and an independent, SEC-accredited CPA. The CPA conducts a financial statement audit to ensure compliance with Philippine Financial Reporting Standards (PFRS) and Philippine Standards on Auditing (PSAs). The SEC and BIR enforce strict criteria for auditors, emphasizing the importance of expertise and proper credentials. Selecting a qualified auditor is critical to avoid compliance issues.

  • Company’s Role: The internal accounting team compiles financial records, including ledgers, invoices, and transaction logs, ensuring they are complete and accurate for audit preparation.
  • CPA’s Responsibilities: An accredited CPA examines the financial data, performs audit tests (e.g., reconciliations, third-party verifications), and issues a report certifying the statements’ accuracy.
  • Auditor Qualifications: Auditors must be accredited by the Board of Accountancy (BOA) and, for SEC submissions, by the SEC. Specialized industries like banking may require additional certifications from bodies like the Bangko Sentral ng Pilipinas (BSP).
  • Independence Requirement: To ensure objective reporting, the CPA must maintain impartiality and be free from financial or personal connections to the company.
  • Risks of Non-Compliance: Statements signed by non-accredited auditors may be rejected, resulting in fines or delays in SEC filings.

Why Audits Are Essential for Financial Statements

Audits of financial statements are conducted to confirm their accuracy, ensure regulatory compliance, and enhance their credibility for stakeholders. In the Philippines, audits are a key component of corporate governance, mandated to protect investors and maintain the financial system’s integrity. Beyond meeting legal requirements, audits provide strategic advantages, such as identifying operational inefficiencies and strengthening financial controls. Companies that invest in thorough audits often gain a competitive edge in securing funding and partnerships.

  • Verifying Accuracy: Audits identify errors, discrepancies, or fraudulent entries, ensuring financial statements accurately reflect the company’s performance.
  • Ensuring Compliance: Audits confirm adherence to PFRS, PSAs, and SEC/BIR regulations, minimizing the risk of penalties or legal challenges.
  • Boosting Trust: Audited statements are more credible to banks, investors, and regulators, facilitating access to loans, investments, or business opportunities.
  • Strengthening Controls: Auditors often suggest improvements to accounting systems, enhancing financial management and risk mitigation.
  • Supporting Strategy: Accurate financial data from audits enables management to make informed decisions about growth, budgeting, or cost optimization.

When Are Audited Financial Statements Mandatory?

The obligation to submit audited financial statements in the Philippines hinges on thresholds defined by the SEC and BIR and the company’s fiscal year. Timely filing is required to avoid penalties, with deadlines varying based on the company’s SEC registration number, fiscal year-end, and whether it is publicly listed. Businesses must align their audit and filing schedules to meet these requirements, primarily through the SEC’s Electronic Filing and Submission Tool (eFAST).

  • SEC Criteria: Stock and non-stock corporations with assets or liabilities of PHP 600,000 or more and foreign branches with assets or revenues of PHP 1,000,000 or more must file audited financial statements annually.
  • BIR Criteria: Entities with gross annual sales, earnings, or receipts exceeding PHP 3,000,000 must include audited financial statements with their Annual Income Tax Return (AITR).
  • Deadlines for Calendar Year-End: The BIR deadline for fiscal years ending December 31 is April 15 of the following year. The SEC employs a staggered schedule based on the SEC registration number, typically beginning in April.
  • Non-Calendar Year-End: Companies with different fiscal year-ends must submit within 120 days from the fiscal year-end for SEC filings or by the 15th day of the fourth month for BIR submissions.
  • Publicly Listed Entities: Companies listed on the Philippine Stock Exchange (PSE) or under Section 17.2 of the SRC must file within 105 days after their fiscal year-end, attached to SEC Form 17-A.
  • Exemptions and Late Filings: Entities audited by the Commission on Audit (COA) may have adjusted deadlines with proper documentation. Late SEC filings are accepted from July 8, with penalties based on the original due date.

Steps to Prepare Audited Financial Statements for SEC Filing

Preparing audited financial statements for SEC submission requires careful planning, collaboration with an accredited CPA, and adherence to PFRS. The process involves compiling financial data, conducting the audit, securing certifications, and filing through the SEC’s eFAST platform. Given the technical nature of the task, businesses must maintain robust bookkeeping and engage professionals to ensure accuracy. The following steps guide companies through the preparation process.

  • Keep Detailed Records: Record all financial transactions throughout the fiscal year, including revenues, expenses, and liabilities, by PFRS. Accounting software can streamline this process.
  • Hire an Accredited CPA: Select a CPA accredited by the BOA and SEC to audit the financial statement. Verify their credentials to ensure compliance.
  • Draft Financial Statements: Prepare the balance sheet, income statement, cash flow statement, and statement of changes in equity, including comprehensive notes on key financial items.
  • Facilitate the Audit: The CPA conducts audit procedures, such as document reviews and third-party confirmations, to validate the financial statements. Management should review and approve any adjustments.
  • Obtain Certifications: Secure a Statement of Management’s Responsibility (SMR) signed by authorized officers, confirming the statements’ accuracy. The CPA provides an audit report.
  • Include Supporting Documents: Attach required SEC disclosures, such as equity and retained earnings details, and the general form for financial statements per Revised SRC Rule 68.
  • File with BIR First: Ensure the audited financial statements are stamped “received” by the BIR or include a Transaction Reference Number from the e-AFS system before SEC submission.
  • Submit via eFAST: Register on the SEC’s eFAST platform, upload the audited financial statements and supporting documents, and file within the deadline. Physical submissions are no longer accepted.

Overcoming Challenges in SEC Submission with Professional Support

Submitting audited financial statements to the SEC is complex, with challenges ranging from regulatory nuances to tight deadlines. Errors in preparation, non-compliance with PFRS, or using non-accredited auditors can lead to rejections, penalties, or operational delays. Given these hurdles, professional assistance from BusinessRegistrationPhilippines.com is invaluable for ensuring compliance and efficiency. As a trusted provider in the Philippines, BusinessRegistrationPhilippines.com offers expert services to navigate this intricate process seamlessly.

  • Navigating Regulations: The SEC and BIR impose specific requirements, such as unique disclosures and certifications, which can be challenging without specialized knowledge.
  • Meeting Deadlines: Staggered SEC schedules and BIR deadlines demand precise coordination, particularly for companies with complex transactions or non-standard fiscal years.
  • Auditor Accreditation Issues: Using a non-accredited CPA can result in rejected filings, necessitating costly corrections and delays.
  • Avoiding Errors: Incomplete disclosures, formatting issues, or inaccurate data can lead to SEC rejections, requiring time-consuming revisions.
  • Resource Limitations: Small and medium enterprises (SMEs) often lack the expertise or staff to effectively manage audited financial statement preparation.
  • Why BusinessRegistrationPhilippines.com: Accessible via its website, BusinessRegistrationPhilippines.com provides tailored accounting and compliance services, ensuring accurate preparation and timely SEC and BIR filings. Their experienced CPAs simplify the process, reducing risks and saving businesses valuable time.

Wrapping Up

Submitting audited financial statements to the SEC in the Philippines is a critical task that requires precision, expertise, and strict adherence to regulatory standards. By understanding the process, engaging qualified auditors, and leveraging professional support, businesses can confidently meet their compliance obligations. The benefits of proper submission extend beyond avoiding penalties, enhancing credibility, and building stakeholder trust. Expert assistance is necessary for companies aiming to streamline their annual financial statement filings in the Philippines.

Is Assistance Available? 

Yes, BusinessRegistrationPhilippines.com, a trusted provider of compliance and accounting services, can guide your business through the complexities of audited financial statement submission. Reach out today to schedule an initial consultation with one of our experts.