• In a significant reversal of its own previous rulings, the Supreme Court, acting on a second motion for reconsideration, upheld the authority of the Securities and Exchange Commission (SEC) to require the accreditation of external auditors for publicly-listed companies and other regulated entities. The Court ruled that this power, while not expressly stated, is implied and incidental to the SEC's mandate under the Securities Regulation Code (SRC) and the Revised Corporation Code (RCC) to protect investors and ensure market integrity. It clarified that this accreditation complements, rather than usurps, the licensing power of the Professional Regulatory Board of Accountancy (BOA).

• The Assailed Regulations: The SEC issued Rule 68 of the SRC's Implementing Rules and Regulations and Memorandum Circular No. 13, Series of 2009, which required Certified Public Accountants (CPAs) acting as external auditors for certain regulated corporations (those issuing registered securities, etc.) to be accredited by the SEC.
• The Challenge: The 1Accountants Party-List and several individual CPAs challenged these regulations, arguing that they were unconstitutional and *ultra vires* (beyond the SEC's powers). They contended that only the Professional Regulatory Board of Accountancy (BOA) has the authority to regulate the practice of accountancy under the Philippine Accountancy Act of 2004.

• RTC Ruling: The RTC declared the SEC regulations null and void for being contrary to the Accountancy Act.
• Initial Supreme Court Rulings (2022 & 2023): The Supreme Court initially denied the SEC's petition and first motion for reconsideration, affirming the RTC's decision.
• Second Motion for Reconsideration: Citing the far-reaching implications of the case, the Supreme Court granted the SEC's rare motion for leave to file a second motion for reconsideration, leading to the present decision.

• Does the SEC have the legal authority to require accreditation for CPAs who act as external auditors for specific corporations under its regulation?
• Does such a requirement encroach upon the exclusive power of the Board of Accountancy to regulate the accountancy profession?

The Supreme Court GRANTED the SEC's second Motion for Reconsideration, REVERSED its previous decisions, and declared the assailed SEC regulations VALID.

• SEC Has Implied and Incidental Authority: The Court held that the SEC's power to accredit external auditors is implied from, necessary, and incidental to its express powers under the SRC and RCC to protect investors, ensure full disclosure, and promote corporate governance.
• Regulation of an Activity, Not the Profession: The accreditation requirement does not regulate the accountancy profession itself, but only the specific activity of auditing SEC-regulated entities. It serves as a quality control mechanism complementary to the BOA's licensing function.
• State Policy and International Standards: The requirement is consistent with the state policy of allowing financial sector regulators (like the BSP and Insurance Commission) to accredit auditors and aligns with international best practices for investor protection.
• No Curtailment of Right: The practice of a profession is a privilege, not an absolute right. The accreditation is a condition on this privilege for a small, specialized subset of practice and does not prevent unaccredited CPAs from serving the vast majority of corporations.

• Implied and Incidental Powers: A government agency's authority is not limited to its express powers but includes those which are necessarily implied or incidental to carrying out its mandate.
• Complementary Regulation: A specialized regulator (like the SEC) can impose additional requirements (like accreditation) on a profession for activities within its specific jurisdiction, provided it does not conflict with the primary regulator's (like the BOA) licensing power.
• Practice of Profession as a Privilege: The practice of a profession is not an absolute right but a privilege burdened by conditions imposed by the State for the public good.
• Statutory Interpretation (RCC): The phrase "Except as otherwise provided... in the rules issued by the Commission" in Section 177 of the Revised Corporation Code grants the SEC the authority to set additional requirements for auditors of corporate financial statements.