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BANGKO SENTRAL NG PILIPINAS
OFFICE OF THE GOVERNOR

CIRCULAR No. 1208

Series of 2025

Subject: Amendments to Regulations on Reporting Governance Framework for

Pawnshops

The Monetary Board. in its Resolution No. 1363 dated 28 November 2024. a roved the
following amendments to the relevant sections of the Manual of Regulations for Non-Bank
Financial Institutions (MORN B F1). The amend merits set forth the Ba rig ko Sentral's expectations
on Pawnshops to establish an effective reporting system with adequate governance rocess
that enables the generation and timely submission of reports in accordance with the Ban ko
Sentral's reporting standards.

Section I. Section 161-P of the MORNBFl is hereby retitled as "Reporting Governance

Framework. " The first paragraph and provisions u rider "Maintenance of Records" and "Re ortin
Obligations to the Bangko Sentral" thereof are hereby deleted. The provisions u rider "Re ort on
Crimes/Losses (RCL)" shall be tra nsferred u rider the new Section 163-P on "Reports" as presented
in Section 4 of this Circular. The retitled and amended Section 161-P of the MORNBFlshall now
read as follows

161-P REPORTING GOVERNANCE FRAMEWORK'

Policy Statement. It is the thrust of the Bangko Sentral to exercise effective

supervision over pawnshops. To facilitate such effective su pervision. the Bangko Sentral
adopts this reporting governance framework for pawnshops. Complete. accu rate.
consistent. reliable and timely su binission of required information concerning a
pawnshop's operation a rid management. fina ncial condition. and results of o perations
are critical for effective supervision over pawnshops. They also support the Bangko
Sentral's determination and formulation of a ppropriate and responsive regulator
policies. supervisory tools. approaches and interventions. and the pawnshop
operator/management's business decision-making process.
It is incumbent upon the pawnshop proprietor/partner/board of directors and
senior management or officers to implement an effective reporting system to generate
complete. accurate. consistent. reliable and timely reports to the Bangko Sentral.
Pawnshops are expected to capitalize on available information technology in
establishing an effective reporting system that is appropriate for their size and
complexity of operations. The Bangko Sentral shall prescribe reasonable reporting
standards. which shall consider the cost of reporting relative to the expected benefits.

Transitory provi^ion. All Pawnshops are given one U ) year from the effectivity of this Circular. to make the necessary
preparations to their systems and processes. This will ensure full compliance with the establishment of an effective
reporting system and the remaining provisions of this Section. This period of preparation shall be treated as
observation period

Imposition of applicable sanctions for non-compliance with the reporting standards shall commence vJith re orts
falling due after the end of the observation period.

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Reporting Standards. Reports submitted to the Bangko Sentral must be

complete. accurate. consistent. reliable and timely to be considered compliant with the
Bangko Sentral reporting standards. It follows that the report shall conform to the
prescribed submission guidelines and reporting templates issued b the Ban ko
Sentral. Conversely. reports with incomplete schedules or attachments shall be
considered non-compliant with the reporting standa rds. Reports should be reviewed
and validated by the pawnshop prior to submission to the Bangko Sentral to ensure
their completeness and correctness. Adequate internal controls should likewise be in
place to ensure adherence to reporting standards.

To comply with these reporting standards, a pawnshop must have a re ortin

system in place that has at least the following functional ities under both business~as-
usual and stressed conditions:

a. Generates accurate. complete and reliable information as required by the

Bangko Sentral and other regulatory bodies;
b. Aggregates all material data across various business lines/services/activities
and entities (belonging to a group) that are relevant to regulatory reporting:
and
c.
Produces in a timely manner. regular. on-demand and ad hoc reports
particularly those required by the Bangko Sentral and other regulatory
bodies.

For this Section. stressed conditions shall refer to emergency conditions for
pawnshops. These include crises. national or public health emergencies. or disasters
caused by natural or human-induced calamities that disrupt operations or result in
abru pt CIOsu re or relocation of offices/branches.

Governance Process. The proprietor/partner/board of directors shall be

responsible for establishing an effective reporting system and performing ade uate
oversight on the implementation thereof by senior management/officers to ensure the
pawnshop's adherence to the reporting standards set by the Bangko Sentral.
An effective reporting system shall include:

a
A management information system coinmensurate to the nature and
operational complexity of the pawnshop's business activities that:
a ) fully su pports the pawnshop's reporting requirements:
(2 ) allows internal review a rid validation prior to the su binission of re ports;
(3) facilitates the electronic transmission of data and reports;
(4) is capable of securing client information and adhering to data privacy
laws and regulations; and
(5) reliably maintains database and/or records. and complies with the
minimum period of storing information

b. Written policies and procedures duly-approved by the pawnshop's

governing body. These shall set forth the standards and processes In
generating quality internal and external reports: and

c. Timely and periodic independent review of reporting standards and

processes to ensure continuing reliability and effectiveness

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Sanctions for Non-compliance with the Reporting Standards. The foll

guidelines shall govern the imposition of sanctions on a pawnshop for non-coin Iian
with the reporting standards:

a. Deftmt^^n of terms

(7) Erroneous report- A report submitted within the prescribed deadline. but
is found to be non-compliant with the Bangko Sentral reportin
standards described in this Section shall be classified as 'Erroneous".
Submission of an Erroneous Report shall be considered as willful failure
to comply with a regulation. For electronically-transmitted reports.
"E rroneou s"
or failed submission shall include, among others: failure to
use prescribed filenames. correct file format. prescribed subject line or
reporting date. officially registered e-mail add resses; and su binission of
reports with incorrect or incom PIete attachments

121 Delayed report- A report that was able to coin ply with the Ba rig ko Sentral
reporting standards after the submission deadline for said report. but
before the report is considered as "Unsubmitted" as defined in the next
paragraph. shall be classified as 'Delayed". Submission of a coin Iiant
report after the submission deadline shall be considered as willful dela
in the submission of reports.

(3) Unsubmi'tted report - A report that was not submitted. transmitted to

incorrect/wrong e-mail addresses. or was submitted but not able to
comply with the Bangko Sentral reporting standards. by the time the
next report becomes due or upon the lapse of thirty (30) business days
from the report's submission deadline. whichever comes first. shall be
classified as "Unsubmitted". See Table 2 as reference for the defined
number of business days after submission deadline for a report to be
considered "Unsu binitted". Unsubmitted reports amount to willful
refusal to comply with the regulation. Further. a report submitted to the
Bangko Sentral u rider the sig natu re of an officer who is not authorized in
accordance with the requirements in this Section shall also be
co nsidered as "U nsu binitted".

b. Monetary Penalties

The applicable monetary penalty shall be based on a prescribed fine for

each occu rrence (in case of Erroneous reports ) or for each day of delay (in case of
Delayed or Unsu binitted reports ). Monetary penalties shall accuinulate until
such time the report has been determined compliant with the prescribed
reporting standards as provided in Table I: Prov/'ded, That reports considered
"Unsubmitted" shall be subject to the limit on the number of calendar da s with
monetary penalty computation as provided in Table 2.

Table I - Prescribed fines_fg. r. _reportin violations

Pawnsho T e Prima Re orts Seconda Re orts
A P 300 P 60
B 400 150
C and D 500 300

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The list of reports classified as Primary (Category A and its su b-categories)

and Secondary (Category B) are provided under Appendix P-7.

Erroneous - For a report initially considered Erroneous but subsequently

complied with the reporting standards within the prescribed deadline. the
penalty shall be computed by multiplying the prescribed fine by the number of
times the subject report was submitted before being considered compliant.

Delayed - For Delayed reports. the penalty shall be computed by

multiplying the prescribed fine by the number of calendar days delayed.
Erroneous and Delayed - If the report initially considered Erroneous was
able to comply with the reporting standards but after the prescribed deadline
(i. e. . Delayed). the penalty shall be based on the sum of the penalty for being
Erroneous and the penalty for being Delayed

Unsubm/'tted - For reports classified as Unsubm/'tted (regardless if said

report was not submitted or was previously submitted but remains non-
compliant as described under this Section on Sarict/bns for Non-compliance
with the Report/hg Standards). the monetary penalty shall be three times (3x)
the number of days applied for determining such classification. as provided in
Table 2:

Table 2 - Defined number of days for penalty computation for reports

considered Unsu binitted
(Column A) (Column B) (Column C)
Reporting defined # of business # of days for penalty
Frequency days after submission computation for
deadline to be reports considered
considered "U nsu binitted "
"Unsu binitted "
(A) (B). (A multi lied b 3)
M o n tb_!){'~
Quarterly --~~ '
Seinestral/Semi-Annual 30 90
Annual
Event-Based*

'This rel^;;Is to reports that the Pawnshops are requ/'red to subm/'t upon the
occurrence of an evenlyincident or upon request by the appropriate superunsing
department of the Bangko Sentra/ for the purpose of conduct/hg surveillance of
the Pawnshop Industry

In the event that a compliant report is received after it has been

considered Unsubm/'tted. the applicable penalty shall be based on the number
of days provided in Column C of Table 2. This will be the case even if the actual
number of business days delayed is less than the constant number of days
provided in said Column C.

Failure to submit a report on time due to fortuitous events such as fire

and other natural calamities. public disorders including strike and lockout
affecting a pawnshop as defined in the Labor Code or of a national emergency
affecting the operation of pawnshops shall not be considered as willful delay in

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submission of reports foe/ayed) or willful failure IErroneous) or refusal

funsubm/'tted) to comply with a regulation

In cases of reports falling due in a period affected by a fortuitous event or

within a regulatory relief period. said reports should comply with the reportin
standards of the Bangko Sentral within fifteen (15) business days after the end of
the said fortuitous event or regulatory relief. Otherwise. they shall be considered
"Unsubm/'tted' and imposed with a monetary penalty equivalent to the
applicable fine prescribed in Table I multiplied by forty-five (45) days (i. e. . three
times [3x] fifteen 1151 days).

A pawnshop is still required to submit a compliant report even after said

report has been classified as " Unsubm/'tted'

c. Implementation

The submission deadline is considered moved to the next business da

whenever it falls on a non-working day in the locality where the pawnsho is
situated or on a working day where business operations in government offices
are suspended due to fortuitous events.

The submission of reports to the appropriate supervising department of

the Bangko Sentral shall be done electronically. unless otherwise specified in a
Circular or Memorandum of the Bangko Sentral. The date when the report was
successfully sent electronically shall be considered as the date of filing. If the
specified mode of submission in a Circular or Memorandum is via re istered
mail/courier or through messengerial services. the date of mailing postmarked
on the envelope or the date of receipt from the messengeriai service. as the case
may be. shall be considered as the date of filing

Assessment of Reporting System. The Bangko Sentral shall conduct an

assessment of the quality of a pawnshop's reporting system to determine the integrity
of reports being su binitted and the root cause of persistent submission problems. if a n .
Consistent with the Bangko Sentral Supervisory Enforcement Policy under Sec. 002-P.
the Bangko Sentral may deployits range of supervisory actions coinmensurate with the
level of deficiencies/concerns in the pawnshop's reporting system. This is to promote
adherence to standards and principles set forth in this Section. bring about timel
corrective actions and compliance with Bangko Sentral directives. all with the end in
view of ensuring that pawnshops operate in a sound. lawful and orderly manner.
Failure of the proprietor/partner/board and senior management of the
pawnshop to implement the required corrective measures within the specified time
frame shall be grounds to subject the pawnshop including its proprietor/partner/board.
senior in a nagement and other responsible official/s to a ppropriate enforcement actions
provided in the Bangko Sentral's Supervisory Enforcement Policy under Sec. 002-P.

The foregoing is without prejudice to imposition of sanctions provided under

applicable regulations and laws. such as but not limited to. Sections 34.35. and 36 of
Republic Act (R. A. ) No. 7653 (The New Central Bank Act). as amended by R. A. No. 1/211.
and Section 18 of Presidential Decree (P. D. ) No. 1/4.

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 Section 2. Section 162-P on "Audited Financial Statements" of the MORNBFl is hereb
renumbered and transferred to Section 164-P. A new Section 162-P on "Financial Records" shall
be added to read as follows:

162-P FINANCIAL RECORDS

Pawnshops shall have a true and accurate account. record or statement of their
daily transactions. For this purpose. "records" shall refer to information. whether in its
original form or otherwise. including docu merits. sig natu res. seals. texts. images. sou rids.
speeches. or data compiled. recorded or stored. as the case may be: a) in written form
on a ny material; (2 ) on film. negative. tape or other medium so as to be capa ble of being
reproduced; or (3) by means of any recording device or process. computer or other
electronic device or process; and regardless of whether theseinformation are stored and
kept by the pawnshop or another entity duly authorized by the pawnshop (e. g. .
technology service provider). Records shall also include audio. photographic. and video
evidence of events. acts. or transactions of the pawnshop. including all records of
communication. oral (e. g. . voice recordings) or written (e. g. . letters) of officers and
employees of the pawnshop: Provided. That the recording was madein connection with
the performance of the official functions of the concerned officers or em 10 ees and
cou rsed th rough BSFl-issued coin puters. telephones. mobile phones. and similar
devices.

The making of any false entry or the willful omission of entries relevant to an
transaction is a ground for the imposition of administrative sanctions under Section 37
of R. A. No. 7653. as amended. in relation to Section 17 of P. D. No. 114. otherwise known as
Regulating The Establishment And Operation Of Pawnshops. This is without re'udice
to criminal liability of the proprietor/partner/director and/or officer or person
responsible u rider Sections 35 and 36 of R. A. No. 7653. as a mended. and Section 18 of P. D.
No. 1/4 and/or the applicable provisions of the Revised Penal Code.

Records shall be retained for a period of at least five (5) years, unless otherwise
required by law or other regulations. or as directed by the Bangko Sentral to be retained
for a longer period. However. records which are the subject of. or are pertinent to. an
issue that has been raised during a Bangko Sentral examination shall be preserved until
such time that the issue has been fully resolved with finality by the Bangko Sentral.
Pawnshop records. ledgers. books and documents (including those in electronic media)
shall have backup ha rd and/or soft copy to allow reconstruction of records in case of loss
or destruction due to fire and other fortuitous events and shall be made available for
Ba rig ko Sentral examination upon request.

Adoption of the Manual of Accounts. Pawnshops shall strictly adopt the Manual
of ACcou nts prescribed by the Bangko Sentral for recording daily tra nsactions includin
reportorial and publication requirements. The Manual of Accounts for Pawnshops is
provided in Item 'A" of Appendix P-6.

Philfy, pine Financial Reporting Standards (PFPSyPhi/4:7pine Accounting

Standards PAS). All records and reports of pawnshops shall conform to the PFRS/PAS.

The accounting records of pawnshops shall consist of records of original ent

and books of final entry. The records of original entry shall consist of pawn tickets. official
receipts. vouchers and other supporting documents. The books of final entry shall
consist of the general ledger. subsidiary ledgers and registers of loans extended and
loans paid

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 A pawnshop that uses a computerized system may record its loan transactions
in individual loan extended vouchers which shall contain the same information and/or
equivalent controls necessary to comply with Section 11 of P. D. No. 1/4 in lieu of the loans
extended and loans paid registers. The Description of Loan Registers of Pawnshops
provided in Item "B" of Appendix P-6 shall be followed.

Section 3. The title and reference section provided in Appendix P 6 of the MORNBFlis
hereby amended to read, as follows

MANUAL OF ACCOUNTS AND DESCRIPTION OF LOAN REGISTERS OF PAWNSHOPS

44ppend/:x' to 162-P on FINANCIAL RECORDS)
XXx

Section 4. . Section 163-P of the MORNBFlis hereby added to read. as follows:

163-P REPORTS

Pawnshops shall submit to the appropriate supervising department of the

Bangko Sentral the reports listed in Appendix P-7 in such frequency and within
deadlines indicated therein. In the preparation of said reports. pawnsho s shall use and
strictly follow the forms prescribed by the Bangko Sentral.

In line with the policy direction of R. A. No. 8792 (Electronic Commerce Act of
2000). electronic submission of reports is highly encouraged by the Bangko Sentral.
Only electronic submissions originating from officially registered e-mail
address/es of the pawnshops shall be recognized and accepted by the Bangko Sentral.
The official e-mail address refers to the same e-mail address/es used by pawnshops in
securing authority to operate from the Bangko Sentral. or such updated official e-mail
address/es as subsequently submitted to the Bangko Sentral. duly supported by
certification from the proprietor/partner/board of directors.

SIg'"atones of Reports. For primary reports. the proprietor. managing partner.

President/Chief Executive Officer (CEO). officer holding equivalent rank and function or
the duly designated representative. shall sign the reports required to be submitted to
the Bangko Sentral: Provided. That in case of duly designated representatives. the
pawnshop operator shall retain responsibility for the accuracy and timeliness of the
report. Reports submitted in electronic media shall be subject to the same requirements
or equivalent controls. For secondary reports. reports shall be signed by duly designated
officers or their alternates. unless otherwise specified by the Bangko Sentral.
A report submitted to the Bangko Sentral under the signature of an officer who
is not authorized in accordance with the requirements in this Section shall be
considered as unsubmitted.

The designated signatories of reports including their specimen signatures shall

be contained in a signed certification from the proprietor or a resolution approved b
the board of directors or partners. A copy of the proprietor's certification or
board/partners resolution covering the initial designation and subsequent change(s) in
signatories as well as specimen signatures of the signatories and alternates shall be
made available for inspection by the Bangko Sentral examiners and submitted to the

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Bangko Sentral upon request of the appropriate supervising department of the Bangko
Sentral.

Deadline for submission offeports.

a. Regular reports. Unless otherwise specified. the deadlines for submission of

reports enumerated in Appendix P-7. shall be reckoned on the basis of business
days. For this purpose. business days shall be understood to mean Monda
through Friday or business days of the Bangko Sentral.

b. Call Reports. The deadline of submission of call reports shall be s ecified in the
letter calling for the report.

Report on Crimes/tosses IRCL). Pawnshop Operators shall electronically su binit

an RCL within ten (10) calendar days from knowledge of the crime/incident.

a. Pawnshop Operators shall report on the following matters to the Bangko Sentral

a ) Crimes whether consLimmated. frustrated or at tern pted against

property/facilities (such as robbery. theft. swindling or estafa. forgery and other
deceits) and other crimes involving loss/destruction of property of the pawnshop
when the amount involved in each crime is P20.000 or more.

Crimes involving Pawnshop personnel. regardless of amount and whether or not

such crimes resulted in the loss/destruction of property of the pawnshop. shall
likewise be reported to the Bangko Sentral.

(2) Incidents involving material loss. desti'uction or damage to the pawnshop's

property/facilities. other than arising from a crime. where the amount involved
per incident is P20.000 or more

(3) Crimes and/or incidents other than crimes involving loss, destruction or damage
to the pawnshop's pawned articles. regardless of amount.

(4) Deft/71't/'on of tellns. For the purpose of this regulation, the following definitions
shall apply:

(a) Swindling (Estai5a) - a crime committed by a person who defrauds another

causing the latter to suffer damage by any of the following means
(i) with unfaithfulness or abuse of confidence:
(ii) by false pretenses or fraudulent acts executed prior to or
simultaneously with the commission of the fraud; or
(iii) through other fraudulent means and other forms of swindling. under
Articles 315 to 317 of the Revised Penal Code. as amended

(b) 7/7eft - a crime coinnfitted by a person who. with intent to gain but without
violence against orintimidation of persons nor force upon things, shall take
personal property of another without the latter's consent pu rsuant to Article
308 a rid other pertinent provisions of Chapter 111. Title X of the Revised Penal
Code. as amended

IC ) Robbery- a crime coin mitted by a person who. with intent to gain. shall take
any personal property belonging to another. by means of violence against o1'

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intimidation of any person. or using force upon anything pursuant to Article

295 and other pertinent PIOvisions of Cha pter I. Title X of the Revised Penal
Code. as amended.

(d ) Fa/SII^at/'on - a crin\e committed by a person who falsifies a document by

(i) Counterfeiting orimitating any handwriting. signature or rubric;
(ii) Causing it to appear that persons have participated in any act o1.
proceeding when they did not in fact so participate;
(iii) Attributing to persons who have participated in an act or proceeding
statements other than those in fact made by them;
(iv) Making unti'uthfulstatementsin a narration of facts;
(v) Altering true dates;
(vi) Making any alteration or intercalation in a genuine doeument which
changes its meaning;
(vii) Issuing in an authenticated form a document purporting to be a copy
of an original document when no such original exists. or including in
such a copy a statement contrary to. or different from. that of the
genuine original; or
(viii) Intercalating any instrument or note relative to the issuance thereof in
a protocol. registry. or official book and other acts falling under Articles
169,171.172 a rid 178 of the Revised Penal Code. as amended

(e ) Credit-card related cr/fries - crimes a rising throug h the use of credit ca rds

(f) Other crimes that may cause loss to the Pawnshop - crimes committed that
cannot be appropriate Iy classified u rider a ny of the above classifications.

(g) Neg//^ence - the failure to exercise the care which an ordinarily prudent
person would use under the circumstances in the discharge of the duty then
resting upon him

(h) Non-crime related/OSs-Incidents that may cause the Pawnshop to suffer a

loss arising from fortuitous events

(1) Iris/'der - person involved includes proprietor/partners/directors, officers and

employees of the Pawnshop.

co Outsider- persons involved other than an insider

(k) Perpetrator- a person. whether an insider or outsider. who is responsible for

the commission of crime either by direct participation. inducement or
cooperation. including accom PIices and accessories as defined u rider
Articles 18 and 19 of the Revised Penal Code. as amended

(1) Victim - an insider or outsider other than the perpetrator. who is the
aggrieved party to the crime and may as a result of the incident. suffered the
loss.

(in ) A ttempted crime - a crime is attern pted when the perpetrator commences
the commission of the crime directly by overt acts and does not perform all
of the acts of execution which should produce the crime by reason of some
cause or accident other than his own desist ance under Article 6 of the
Revised Penal Code. as amended

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(n) Frustrated cr/'me - a crime is classified as frustrated, when the perpetrator

performs all the acts of execution which would produce the crime as a
consequence but which. nevertheless. do not produce it by reason of causes
independent of the will of the perpetrator under Article 6 of the Revised
Penal Code. as amended.

(0) Consummated cri'n7e - a crime is consummated when all the acts necessa
for the execution and accomplishment of the crime was performed. As a
result. the Pawnshop may have suffered a loss. the recoverable portion of
which should be deducted to arrive at the probable loss incurred b the
Pawnshop.

(p) Term/'nation of the Ihvest/:gat/'on - an investigation is said to be terminated

when all the material facts/information which are sufficient to support a
conclusion relative to the matters involved have already been gathered and
a finding/conclusion may be made based on the gathered information.
b.
The following guidelines shall be observed in the preparation and submission of the
report:

(1) The Branch or Head Office's PCL shall be submitted electronically to the Ban ko
Sentral to the e-mail address to be provided by the appropriate supervisin
department of the Ba rig ko Sentral, within ten (10 ) calendar days from knowledge
of the crime or incident th rough the Pawnshop's Head Office and shall be certified
correct by the Coin PIia rice Officer or officer of eq uivalent re n k a rid fu nction. When
the deadline falls on a non-business day. the report shall be submitted on the
immediately following business day

Supporting documents (e. g. . (i) Notarized list of lost pawned articles. indicating
the pawn ticket number. name of the pawner. date loan granted. brief descri tion
of pawn. and amou nt of loan; (ii) Police report on the investigation of the incident;
(iii) Proof of notification in writing to all pawners concerned about the incident:
and (iv) Proof of settlement of pawner's claim for lost pawned items due to the
reported incident/crime) shall be made readily available by the pawnshop during
Bangko Sentral examination or as requested by the Bangko Sentral.

(2 )Where a thorough investigation and evaluation of facts are necessa ry to complete

the report. an initial report electronically submitted to the e-mail address to be
provided by the appropriate supervising department of the Bangko Sentral.
within the said deadline of ten (10) calendar days may be accepted: Provided. That
a complete report is electronically submitted to the e-mail address to be
provided by the appropriate supervising department of the Bangko Sentral not
later than twenty (20) calendar days from termination of investigation
Moreover. an RCL with incomplete information shall be considered as erroneous
report. and the Pawnshop concerned shall be required to submit an amended re ort.
subject to applica ble sa nctions.

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Section 5. A new paragraph shall be inserted in the renumbered Section 164-P of the
MORNBFl on "Audited Financial Statements" to read as follows:

164-P AUDITED FINANCIAL STATEMENTS

The Bangko Sentral recognizes that external auditors play a vital role in
contributing to the conduct of effective supervision and sustaining the confidence of
the public in the financial system. In this light, the regulations on financial audit aim to
enhance the quality of information channeled to the supervisory process and ultimateI
promote fairness. tra nsparency and accu racy in fina ncial reporting.
The following rules shall govern the submission of audited financial statements
(AFS) of pawnshop operators

For purposes of this Section. AFS shall include the balance sheets, income
statements. statements of changes in equity. statements of cash flows. notes to fina ncial
statements. and the opinion of the external auditor. The AFS of pawnshop o erators
with subsidiaries shall be presented side by side on a solo basis (parent) and on a
consolidated basis (parent and subsidia ries).

Financial Audit. Pawnshop operators shall cause an annual financial audit b an

external auditor. who will render an opinion on the fairness of the pawnshop operator's
financial statements.

Financial audit of the following pawnshop operators shall be rendered by an

external auditor included in the List of Selected External Auditors for BSFls not later than
thirty (30 ) calendar days after the close of the calendar year
a
Pawnshop business with corollary remittance activity req uiring Ba rigko
Sentral Registration. with or without money changing/foreign eXchange
dealing (Type C License): and

b. Virtual pawnshop operators. or those engaged in pawnshop business

through electronic pawning (e-pawning which refers to systems and
processes that enable customers to pawn their personal property through
electronic channels) (Type D License).

The aforementioned pawnshop operators shall su binit their AFS. accompa nied
by the documentary requirements as enumerated under Appendix P-78, to the
appropriate supervising department of the Bangko Sentral. not later than 120 calendar
days after the close of the calenda r year

The external auditor shall be required by the proprietor/partners/board of

directors to submit a Letter of Comments (LOC) indicating any material weakness or
breach in the institution's internal control and risk management systems not later than
120 calendar days after the close of the calendar yea r. If no material weakness or breach
is noted to warrant the issuance of an LOC. a certification under oath stating that no
material weakness or breach in the internal control and risk management system was
noted in the course of the audit of the pawnshop shall be submitted in its stead.
together with the AFS

Material weakness shall be defined as a significant control deficienc . or

combination of deficiencies. that results in more than a remote likelihood that a
material misstatement of the financial statements will not be detected or prevented b

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the institution's internal control A material weakness does not mean that a material
misstatement has occurred or will occur. but that it could occur. A control deficienc
exists when the design or operation of a control does not allow inaria ement
employees, in the normal course of performing their assigned functions. to prevent or
detect misstatements on a timely basis. A significant deficiency is a control deficienc .
or combination of control deficiencies. that adversely affects the institution's abilit to
initiate. authorize. record. process. or report financial data reliably in accordance with
generally accepted accou nting principles. The phrase "more than remote likelihood"
shall mean that future events are likely to occur or are reasonably possible to occur

The proprietor/partners/board of directors, in a regular or special meeting, shall

consider and act on the AFS and the LOC and shall submit, not later than 120 calendar
days after the close of the calendar year. a copy of its resolution' (containing the date of
receipt of the AFS and LOC by the proprietor/partners/board of directors) to the
appropriate supervising department of the Bangko Sentral. The resolution shall show
the action(s ) taken on the AFS and the findings a rid recommendations stated in the LOC.
if any.

The AFS required to be submitted shall in all respect be Phili ine Financial
Reporting Standards (PFRS)/Philippine Accounting Standards (PAS ) compliant. The
guidelines under Sec. 162-P IF/hanc/t, / Records)shall be adopted.

Pawnshop operators. as well as external auditors. shall strictly observe the

requirements in the submission of the AFS and reports required to be submitted under
Appendix P-78

Pawnshop operators. other than those listed in Items 'a"and 'b"above. however.
are not required to submit to the Bangko Sentral their AFS and the document ar
requirements enumerated under Append/Ix' P-78, and their annual financial audit may
be conducted by an external auditor other than those included in the List of Selected
External Auditors for BSFls: Provided. That the AFS and the aforementioned
documentary requirements shall be made readily available to the Bangko Sentral
du ring examination. or whenever req uested.

The reports and certifications of institutions concerned. schedules and

attachments required under this Section shall be considered Category 8 re orts.
delayed submission of which shall be subject to the penalties under Sec. 161-P
(Sanctions for Non-coinp/^^rice WITh the Reporting Standards).

Posting of audited financial statements. Pawnshop operators shall OSt in

conspicuous places in their head offices. all their branches and other offices. as well as
in their respective websites. their latest AFS

Disclosure requirements to the audited financial statements. Pawnsho

operators shall disclose the information prescribed under Annex B of Appendix P-18in
the AFS.

Section 6. Appendix P-7 of the MORNBFl on List of Reports Required from Pawnsho s
is hereby amended. as shown in Annex A of this Circular.

' Proprietor may instead issue a certification or report on the action taken

Page12 on3
 Section 7. Section 131-P of the MORNBFlis hereby amended to read, as follows:

131-P DEFINITIONS. QUALIFICATIONS, AND DUTIES AND RESPONSIBILITIES OF

PROPRIETOR/PARTNERS/DIRECroRs/OFFICERS

XXX

Definitions. xxx

xxx

General Qualifications. Any person can be a proprietor, partner, or director,

president or officer of equivalent rank and function, and over-all head of the pawnshop
operation and the head of the compliance unit of pawnshops provided he/she:

a. Must have complied with the Anti. Money Laundering (AML)/Combating the
Financing of Terrorism (CFr) training as prescribed under Sec. 103-P
111.7andato, y tra/hing requ/Iement/ and
b. Must not be included in the Bangko Sentral Watchlist Files.

An NBl clearance shall also be required for any newly

accepted/elected/appointed partner. director, president or officer of equivalent rank
and function. and over-all head of the pawnshop operation and the head of the
compliance unit of pawnshop.

Pawnshops shall submit to the appropriate supervising department of the

Bangko Sentral annually a complete list of proprietor/partners/directors and officers as
defined in Section 131-P, within twenty (20) business days from date of annual
election/re-election/appointment/promotion of directors/partners/officers, and any
changes' thereto such as resignation or retirement. in accordance with Appendix P-7
and using the format under Appendix Q. 59.

132-P DISQUALIFICATION AND WATCHLisriNC OF DIRECTORS AND OFFICERS

XXX

Section 8. E"^c'tivity'. This Circular shall take effect fifteen (15) calendar days after its
publication either in the Official Gazette orin a newspaper of general circulation.

FOR THE MONETARY BOARD:

Digitally signed by ER M. Reinolona Jr

^^..... ^,^. (-~~~ Date: 2025.01,1514:4732 +08'00'

ELI M. REMOLONA. JR.

Governor

3
For any changes in ownership requiring prior Bangko Sentral approval. please refer to Section 122-P for the
documentary requirements.

Page, 3 orris
 Appendix P-7

LIST OF REPORTS REQUIRED FROM PAWNSHOPS

1:4ppendi, r to Sec. 163-P on Reports)

The list includes reports to be submitted periodically (i. e. . monthly. quarterly. semi-annually. or annually) and reports and
notification requirements as tra nsactions/incidents occu r

^negQn, EQ^ MQR_Ref Re^ Fr^y Sub^

Proc^

Ran^
REPORTS

A-2 BSP 7-26-02C Sec. 163-P Statement of Condition (SOC ) Annually 30-April sdc-
IHead office with no branch) pawnshop@bsp. gov. ph

Consolidated Statement of Condition - d o- -do- -do-

IHead office and branches)

A's Unnuin be red Sec. 1/4-P (Reportorial EPFS Transactions and Indicators Monthly. 15th business day after d sanbfi-
Requirements I applicable for end of reference epfs@bsp. gov. ph
those with month
authority to offer
EPFS

A's Unnuin be red Sec. 114-P (Reportorial Changes and Enhancements in EPFS Semi-Annually 15th business day after dsanbfi-
Req uirements) applicable for end of reference epfs@bsp. gov. ph
those with semester
authority to offer
EPFS

A-3 BSP 7-26-DSC Sec. 163-P Statement of Income and Expenses Annually 30-April sdc-
IHead office with no branch) pawnshop@bsp. gov. ph

Consolidated Statement of Income and - d o- - d o- - d o-

Expenses
IHead office and branches)

A-2 Unnumbered Sec. 501-P. in relation to Pepo rt on Suspicious Transactions As transaction next business/Working Anti-Money Laundering
the AMLA. as amended occu rs day from date of Council
occurrence or
establishment that the

Pagel of 4

Classification: GENERAL
 Category EQm^ MQR_^t Re^ ^rigy SI^
pro^un

transaction Is
SUSPICIOUS

A-2 Unnumbered Sec. 501-P. in relation to Report on Covered Transactions - d o- 5th business day from Anti- Money Laundering
the AMLA. as amended date of transaction/ Council
occu rrence

A-3 Un nuin be red Sec. 163-P Report on Borrowings of Bangko Sentral Quarterly 15th business day after DSA
Person nel end of reference
quarter

A-2 Unnuin be red Sec. 163-P List of Operating and Closed Pawnshop Seinestral 10th business day after Appropriate supervising
Offices' end of reference department of the
semester Bangko Sentral
A-2 Unnumbered Sec. 131-P List of Proprietor/Partners/Directors and Annually and as 20th business day Appropriate supervising
Officers' changes occur from date of annual department of the
election/re- Bangko Sentral
election/appointment/
promotion of
directors/partners/
officers and any
changes thereto
S^ON^
REE^

B Unnuin be red Sec. 164P Audited Financial Statements IAFS) Annual Not later than 120 dsapawns ho p-
(no prescribed together with attachments listed in calendar days after the afs@bsp. gov. ph
formj Appendix P-18 close of the calendar
year

B Unnuin be red Sec. 163-P Report on Crimes/Losses As Soft copy to the

crime/incident a ppropriate su pervising
occurs department of the
Bangko Sentral
- Initial Within ten (10)
calendar

' The Entity shall maintain records to establish the fitness and propriety of the directors/officers. These shall be made available upon request of the Bangko Sentral
The appropriate supervising department of the Bangko Sentralshallissue the submission guidelines and prescribed reporting template for this report

Page 2 of 4

Classification: GEN ERAL

 gate^ EQ^ Moanet Re^ Ergq^ ^ion
pro^un

days from knowledge

of the crime/incident

- Final Within twenty (20)

calendar days from
termination of
Investigation

B U rinuin be red Sec. 142-P IT Profile Report Annually Within twenty-five (25) d sa ribfi-
calendar days from the it profile@bs p. gov. ph
end of reference year

B Unnum be red Secs. 142-P and 147-Q Reportable Major Cyber-Related As incidents Within two (2) hours trisd@bsp. gov. ph
Incidents occur upon discovery

Within twenty-four (24) trisd@bsp. gov. ph

hours from discovery

B Unnuin be red Secs. 142-P and 147-Q Disruptions of financial services and As disruptions Within two (2) hours trisd@bsp. gov. ph
operations occur upon discovery

Within twenty-four (24) trisd@bsp. gov. ph

hours from discovery
B Unnuin be red Sec. 106-P Commencement of Pawnshop As 5th business day Appropriate supervising
Operations transaction from the actual start of department of the
occurs operations Bangko Sentral

B 01-001 Sec. 103-P Reclassification of Pawnshop License - d o- n/a -do-

B 2P Sec. 122-P and Transfer of Ownership - d o- 10th business day - d o-

Appendix P-2 before transferring the
ownership of the
pawnshop business

B 3P Sec. 105-P Change of Registered/Business Name -do- 10th business day - d o-

before effecting such
change

B 4P Sec. 171-P and Appendix Surrender of Pawnshop Operator - d o- 30th calendar day - d o-
P-3 License Due to Closure of Business prior to the intended
closure of business

Page 3 of 4

Classification: GENERAL
 GategQr>! EQrnLNo. MQR. ^L ^Tit^ E^y ^b^
^Mre

B 5P Sec. 104-P Establishment of Additional Branch - d o- 5th business day from -do-
end of month of start
of operations of new
branch/es

B 6P Sec. 108-P Transfer of Business Location/Change - d o- 5th business day after -do-
of Branch Name effectivity of
transfer/change

B 7P Sec. 108-P Voluntary Closure of Pawnshop -do- 5th business day after - d o-
Office/Branch effectivity of closure
B Unnuin be red Sec. 1/3-P Engaging in allowed corollary -do- 5th business day from - d o-
business activitiesIe. g. . inc n ey the date of actual
changing. remittance agent. bills engagement in such
payment. etc. ) business activity

^.

,
Page 4 of 4

Classification: GEN ERAL