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PFRS ACCOUNTING PRACTICE QUESTIONS AND
ANSWERS FOR FIRST TIME ADOPTERS AND BEYOND-
2026 LATEST VERSION
1. An entity that presents its first PFRS financial statements is referred to under
PFRS 1 as a
a) first-timer.
b) first-time adopter.
c) PFRS novice.
d) first-time PFRSer.
2. PFRS 1 requires an entity to prepare and present an
a) opening PFRS financial statements
b) opening PFRS statement of financial position.
c) opening PFRS statement of profit or loss and other comprehensive income.
d) opening notes to the financial statements.
3. The date to transition to PFRSs is
a) the beginning of the earliest period for which an entity presents full
comparative information under PFRSs in its first PFRS financial statements.
b) the end of the earliest period for which an entity presents full
comparative information under PFRSs in its first PFRS financial statements.
c) the beginning of the first PFRS reporting period.
d) the end of the first PFRS reporting period.
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4. The statement of financial position of ABC Co. as of January 1, 20x4 included an
allowance for bad debts computed using the “aging of accounts receivable”
method. The “over 120 days” category in the aging schedule included a ₱200,000
receivable which was actually written off on January 5, 20x4 (the 20x3 financial
statements were
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authorized for issue on March 1, 20x4). ABC Co. could not have foreseen this
event on December 31, 20x3. Does ABC Co. need to revise its previous estimate of
bad debts as of January 1, 20x4 (date of transition) on December 31, 20x5 (end of
first PFRS reporting period)?
a) No. The receipt of the information on January 5, 20x4 is accounted
for prospectively as a non-adjusting event after the reporting period.
b) Yes. The receipt of the information on January 5, 20x4 is accounted
for retrospectively as an adjusting event after the reporting period.
c) No. The event should be ignored because it is within the scope of the
previous GAAP and not the PFRSs.
d) Yes. Although, PFRS 1 does not require the adjustment, other PFRSs do.
5. Under PFRS 1, the early application of PFRSs that have not yet become effective
as of the current reporting period
a) is required.
b) is permitted, but not required.
c) is required, but not permitted.
d) is prohibited.
6. PFRS 1 requires a first time adopter to do which of the following in the opening
PFRS statement of financial position?
a) Recognize all assets and liabilities whose recognition is required by PFRSs.
b) Not recognize items as assets or liabilities if PFRSs do not permit such
recognition.
c) Reclassify items that it recognized in accordance with previous GAAP as one
PFRS ACCOUNTING PRACTICE QUESTIONS AND
ANSWERS FOR FIRST TIME ADOPTERS AND BEYOND-
2026 LATEST VERSION
1. An entity that presents its first PFRS financial statements is referred to under
PFRS 1 as a
a) first-timer.
b) first-time adopter.
c) PFRS novice.
d) first-time PFRSer.
2. PFRS 1 requires an entity to prepare and present an
a) opening PFRS financial statements
b) opening PFRS statement of financial position.
c) opening PFRS statement of profit or loss and other comprehensive income.
d) opening notes to the financial statements.
3. The date to transition to PFRSs is
a) the beginning of the earliest period for which an entity presents full
comparative information under PFRSs in its first PFRS financial statements.
b) the end of the earliest period for which an entity presents full
comparative information under PFRSs in its first PFRS financial statements.
c) the beginning of the first PFRS reporting period.
d) the end of the first PFRS reporting period.
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4. The statement of financial position of ABC Co. as of January 1, 20x4 included an
allowance for bad debts computed using the “aging of accounts receivable”
method. The “over 120 days” category in the aging schedule included a ₱200,000
receivable which was actually written off on January 5, 20x4 (the 20x3 financial
statements were
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authorized for issue on March 1, 20x4). ABC Co. could not have foreseen this
event on December 31, 20x3. Does ABC Co. need to revise its previous estimate of
bad debts as of January 1, 20x4 (date of transition) on December 31, 20x5 (end of
first PFRS reporting period)?
a) No. The receipt of the information on January 5, 20x4 is accounted
for prospectively as a non-adjusting event after the reporting period.
b) Yes. The receipt of the information on January 5, 20x4 is accounted
for retrospectively as an adjusting event after the reporting period.
c) No. The event should be ignored because it is within the scope of the
previous GAAP and not the PFRSs.
d) Yes. Although, PFRS 1 does not require the adjustment, other PFRSs do.
5. Under PFRS 1, the early application of PFRSs that have not yet become effective
as of the current reporting period
a) is required.
b) is permitted, but not required.
c) is required, but not permitted.
d) is prohibited.
6. PFRS 1 requires a first time adopter to do which of the following in the opening
PFRS statement of financial position?
a) Recognize all assets and liabilities whose recognition is required by PFRSs.
b) Not recognize items as assets or liabilities if PFRSs do not permit such
recognition.
c) Reclassify items that it recognized in accordance with previous GAAP as one
