PRESIDENTS’ STATEMENT
The year 2000 saw the crystalisation of the strategic plans for change to move the
Association forward to the new millennium. The challenges ahead of us cannot be
understated. We are entering an era ruled by the forces of globalisation, liberalisation and
advancing technology and these forces will bring about unprecedented changes in the
environment in which the profession operates. We need to ensure that the profession moves
with the trends and that CPAs are well equipped to face the challenges.
In 1996, the Council appointed a task force headed by the President to undertake a study of
the value of the CPA qualification and the future direction of the Association’s education
function. Following consultations with various interest groups, the task force recommended a
new education strategy for the Association. The main objectives are to position CPA as a
premier post graduate professional qualification, to ensure the continuing relevance of the
CPA qualification to business, and to provide an effective system of professional education
and training that meets the needs of employers, both in business and in practice.
As a first step towards the implementation of the new education strategy, the Foundation
Examination was discontinued in 1999. The CPA qualification now consists of two levels of
Professional Examinations and the minimum entry requirement is a recognised degree or a
tertiary level diploma. This change was prompted by the new trend in general education
resulting from the tremendous increase in opportunities for tertiary studies provided by both
public and private institutions of higher education. Since 1996, the Association’s new intake
of students comprised predominantly degree holders. The new admission requirement has the
benefit of ensuring that prospective CPAs have acquired a stronger academic foundation for
building on their professional education and training.
A task force was appointed by the Council to undertake a comprehensive review of the
Association’s membership and examination structure and its training programme. The initial
proposal submitted to the Council entailed restructuring the Association’s membership into
two colleges with distinction among members in terms of qualification and extent of
involvement in public accounting service. A new examination structure and requirements for
membership admission to the two proposed colleges were also recommended. After
consultations with the professional firms and education institutions, the Council has decided
to retain the current membership structure. However, the Council has adopted the changes to
the examination structure, assessment methods and training schemes recommended by the
task force. The proposals aim to train future CPAs as business professionals; to increase the
accessibility to the CPA qualification and at the same time assess students’ knowledge and
skills on a more comprehensive basis; and to introduce greater flexibility for employers and
students in meeting the practical experience requirements.
The proposed new CPA qualification comprises two levels of examinations. The first level, a
Professional Stage Examination, consists of six subjects covering the concepts and principles
underpinning accountancy in all its disciplines. This is followed by an Advanced Stage
Examination consisting of three independent modules of one paper each, which emphasises
the technical and strategic business skills relevant to the needs of modern business.
A new assessment method will be introduced for the Advanced Stage Examination,
consisting of two assessment components. A student’s performance in an examination
module will be determined by his participation in workshop sessions conducted by trained
group leaders and his results in a final written examination. The new assessment method aims
to enhance students’ inquiry and research capabilities as well as communication skills
through participation in workshop sessions. The final module examination will test students’
mastery and application of technical knowledge and skills, aimed at enhancing their problemsolving and intellectual skills.
The various options of training under the current system will be streamlined into two streams.
The traditional route, training in the office of a CPA in public practice under a training
contract, will be retained for those who plan to build a career in public accountancy practice.
Students who wish to seek a career in commerce, industry or the public sector will not be
required to enter into a training contract. Practical experience may be obtained under the
supervision of a member of MACPA or one of the professional bodies approved by MACPA
and the student is required to maintain a training log book as a record of his practical
experience.
Practical training is a vital component of the CPA qualification process. While greater
flexibility is provided to employers and students in meeting the practical experience
requirements, the quality of training must be maintained. A review of the practical
experience guidelines will be undertaken to reinforce quality control and to emphasise handson IT training and training in other professional skills.
The Council has also proposed to introduce a new qualification, a Professional Certificate in
Accountancy (PCA), which will be awarded to those who have completed the prescribed
modules of the Advanced Stage Examination, without the requirement for practical
experience. The PCA is intended to be a qualification in its own right to meet the needs of
persons who want a qualification beyond an academic degree or diploma. It also provides
flexibility in the attainment of the CPA qualification. A PCA holder is given the option to
start a career in a commercial, industrial or public sector organisation which is not currently
training CPA students, and continue to study and qualify as a CPA at a later stage of his
career.
As part of the consultation process, I have held a series of dialogue sessions with members
across the country. I am pleased to report that the feedback from members showed
considerable support for the new CPA examination and training programme. The Council is
in the process of finalising the detailed syllabuses for the new examination, which will be
posted on the MACPA website by end of June 2001 for members’ comment. The Council has
also started negotiations with a professional publisher to develop study materials for the new
examination. The new CPA qualification is expected to be implemented in November 2002.
The Council is prepared to commit a heavy investment in the education and training process
to ensure that the CPA designation remains a mark of quality and technical excellence.
However, the success of the new CPA qualification will depend very much on members’
support not only in terms of contribution of technical resources to the education and training
process but also in implementing the CPA programme within their organisations.
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The implementation of the new CPA qualification will require appropriate amendments to the
Association’s Memorandum and Articles of Association and bye-laws to put into effect the
proposed changes in the admission requirements and methods of training. The Council took
the opportunity to carry out a comprehensive review of the Association’s constitution. The
Council has proposed that the name of the Association be changed to The Malaysian Institute
of Certified Public Accountants to more appropriately reflect its role and functions. Apart
from the changes affecting student’s training and admission requirements, the Council has
also proposed amendments to the provisions relating to professional conduct with a view to
improving the effectiveness of the Association’s disciplinary process. New provisions were
also proposed for the formation of a Practice Review Committee to serve as a self regulatory
process to assist members maintain consistently high quality of service, and the establishment
of an Advisory Board to provide ideas and advice to the Council on matters affecting the
Association. The proposed amendments will be submitted for members’ consideration at an
extraordinary general meeting to be held on June 23, 2001, immediately after the
Association’s 43rd Annual General Meeting.
The Council has also initiated a review of the Association’s Code of Professional Conduct
and Ethics, particularly relating to publicity and advertising and issues connected to
providing professional services in multi jurisdictions. Whilst the Council has been conscious
of the need for members to market and promote their professional work and services in the
context of a highly competitive marketplace, it is unable to revise the ethical requirements as
the Accountants Act 1967 prohibits a public accountant from any form of advertising. This
restriction has been removed in the recent amendment to the Accountants Act. The Council
has appointed a task force to undertake the review exercise.
The past year has also seen unprecedented changes in the regulatory framework governing
the Malaysian capital market, aimed at enhancing transparency and the standards of corporate
governance. As members of the profession, we have an important role to play in the
achievement of this national objective. Investors, creditors, employers as well as Government
and the public at large rely on us for sound financial accounting and reporting, effective
financial management and competent advice on a variety of business and taxation matters.
We can play a vigilant role in enhancing the standards of corporate governance and
transparency in the various functions that we perform. Quite apart from complying with
statutory requirements, it is incumbent upon us to adhere to the highest professional
standards, which are built on our core values of integrity and objectivity.
We also play a vital role in building a strong body of financial accounting and reporting
standards for Malaysia, which is the cornerstone of a successful disclosure-based regime that
our capital market is now in. Prior to the establishment of the Malaysian Accounting
Standards Board (MASB) in 1997, the Association had been the primary moving force in the
development and promulgation of accounting and reporting standards in Malaysia, which
were aligned to International Accounting Standards. Our initiatives provided a strong
foundation for MASB to take off its standard setting role. The Association continues to form
an important part of the national agenda to enhance the standards of accounting and
disclosure by participating in the MASB standard setting process and monitoring members’
compliance with the standards.
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I must highlight that Malaysia’s approach in subscribing to harmonisation with international
accounting standards has placed Malaysia in good stead in the face of rapid globalisation of
markets. This is particularly so in view of the fact that the International Organisation of
Securities Commissions (ISOCO) has in May 2000, endorsed International Accounting
Standards (IAS) as suitable for purposes of cross-boarder listing. We are in fact ahead of
many jurisdictions which are now embarking on a programme of aligning their standards
with IAS.
Development and enforcement of auditing standards are, of course, one of our core activities.
The recent legislative reforms undertaken by Government to strengthen the regulatory
framework governing fund-raising activities and to enhance standards of corporate
governance have resulted in higher standards of responsibility being placed on our members
engaged in reporting functions. In addition, globalisation and the pervasive use of technology
in business increase our exposure to audit risks. We need to continually review and revise the
standards on auditing to address these emerging issues.
At the professional front, 2000 can be said to be a watershed year for the accountancy
profession. An Amendment Bill was submitted to Parliament in July 2000, setting out
significant changes to the Accountants Act 1967 including the designation of MIA members,
the constitution of the MIA Council and the functions of MIA. The Bill has been passed and
published in the gazette in February 2001, although its effective date has not been determined
yet.
Under the Accountants (Amendment) Act 2001, a new designation, Chartered Accountant
will be used by all MIA members. The existing MIA Council, consisting of the Accountant
General and 14 elected members, will be increased to not more than 30 members. The new
Council will comprise the Accountant General, the President of MACPA, 10 elected
members and not more than 18 members appointed by the Minister of Finance who will
include representatives from the public universities and professional accountancy bodies
recognised in the Accountants Act. MIA will no longer undertake the examination function
and a MIA Qualifying Examination will be introduced to enable persons whose qualifications
are not recognised in the Accountants Act, to gain admission to MIA. The Qualifying
Examination will be conducted by MACPA and approved universities, under the regulation
of MIA.
The Council supports the amendments to the Accountants Act. The Council believes that the
wider representation on the MIA Council will ensure that the views of all parties involved in
the development of the accountancy profession are taken into account in the formulation of
policies and decisions affecting the profession. The Association can expect its education and
examination activities to expand with its involvement in the MIA Qualifying Examination.
I would like to take this opportunity to thank members for supporting my election to the MIA
Council in September 2000. I am proud to be President of the two major accountancy bodies
in Malaysia. This is a unique opportunity and I can assure you that I will use my best
endeavours to achieve greater co-operation and harmonisation in the profession for the
benefit of all members.
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Finance
The financial statements for the year 2000 showed a net operating deficit of RM149,059,
compared with a deficit of RM76,210 for the previous year.
Total revenue increased marginally by RM58,059 or 2.7%. Revenue from student sources
dropped by 15% due to a decline in student enrolment. This was compensated by higher
revenue generated by other activities, particularly CPA programmes and sale of publications.
Total expenses rose by RM212,381 or 63%. The substantial increase was due mainly to the
cost of printing and amortization of the initial development cost of MACPA study manuals.
As I have highlighted in last year’s annual report, the fee income contributed by members and
students was insufficient to cover the cost of services provided to them. The shortfall has
existed since 1993 and has become increasingly more significant each year. The Council has
proposed a revision to the fees payable by members and students in order to keep the income
at a level that will meet the related expenses.
Membership
During the year, membership of the Association grew by 3.9% to reach 2,822 at December
31, 2000. A total of 148 new members were admitted. However, after taking into account
members who resigned or were excluded from membership for failure to pay the annual
subscriptions/practising certificate fees, a net increase of 105 members was recorded.
Of the new admissions, 125 members were admitted under Article 3(a), having completed the
Association’s examinations and fulfilled the prescribed practical experience requirements.
The balance of the new admissions were under Article 3(b) who are full members of
approved overseas accountancy bodies and have either passed the Association’s examination
in company law and advanced taxation or have been granted exemption from the examination
on the basis that they have had adequate working experience in the relevant fields after
qualifying as an accountant.
There has been a slight change in the membership profile. The number of members employed
in practising firms decreased by 4%, to 53% of the total membership at December 31, 2000.
Of the members in this category, 15% hold practising certificates. A total of 42% of the
members worked in commerce, industry and financial institutions, representing an increase of
4% as compared to the previous year. The number of members employed in the public sector
remained at 2% while 3% were retired members.
During the year, a total of 72 female members were admitted, constituting 48% of the total
new admissions. The proportion of female members increased marginally from 31% in the
previous year to 32% at end of 2000.
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MEMBERSHIP STATISTICS
As at December 31
2000
1999
Net Increase /
(Decrease)
415
417
(2)
Not in Practice
2,407
2,300
107
Total
2,822
2,717
105
In Practice
Provisional Members
A total of 32 new provisional members were admitted during the year. These are “graduate
members” who have completed the Association’s examinations but have not yet fulfilled the
practical experience requirement for admission as full members. Provisional members enjoy
the full range of membership services and all other privileges of a qualified member with the
exception of the right to vote on the Association’s policy matters, the right to carry out any
duty reserved to members of the Association, and the right to hold himself out as a principal
or partner of an accounting firm.
Services to Members
An important task of the Council is to ensure that the Association continues to provide
relevant services that meet the needs of different segments of the membership.
This function is carried out with the help of committees and working groups formed by the
Council to identify and serve the specific needs of members involved in different areas of
work. These include the Commerce and Industry Committee, Insolvency Practice Committee,
Public Practice Committee, Taxation Working Group and Public Sector Working Group. Ad
hoc task forces are also appointed to address emerging issues of concern. On top of these, the
Accounting and Auditing Technical Committee and the Education & Training Committee
provide constant technical updates and continuing professional education to assist members
keep abreast of current changes in the work environment.
The new MACPA website, which became operational in October 2000, aims to improve the
delivery of products and services to members. The website contains an electronic information
centre with access to a searchable database of accounting and auditing standards, changes in
laws and regulations affecting members’ work and technical updates. It provides members
on-line access to the Association’s technical resources.
It is also the intention of the Council to use the IT network as the main vehicle of
communication with members. The Secretariat is in the process of compiling a directory of
members’ e-mail addresses. When the task is completed, the Internet will be used as the main
channel of communication and delivery of information to members.
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The Council is keenly conscious that members work in a fast-changing environment. It
constantly undertakes initiatives to improve the services provided to members to ensure that
CPAs in any sector preserve their technical excellence.
Continuing Professional Education
It cannot be disputed that there is no alternative to a commitment to continuing professional
education as the means for maintaining and improving our technical knowledge and
professional skills, to meet public expectations about the quality of our work.
To assist members in meeting their CPE requirements, a series of seminars, workshops,
evening talks and public forums were held throughout the year. A wide range of topics were
covered including updates of accounting pronouncements, corporate governance, ecommerce, risk management, public listing requirements, operation of the Malaysian capital
market, changes in tax legislation and even effective negotiating skills.
The Association also participated in a number of CPE events jointly organised with other
professional bodies. The most significant was the 2000 National Conference on Internal
Auditing jointly organised with the Institute of Internal Auditors Malaysia (IIAM). The 2-day
Conference deliberated on a number of topical issues related to the theme, Auditing in the
New Millennium – Governance, Control and Assurance. A keynote address was also
delivered by Yg Bhg Datuk Ali Tan Sri Abdul Kadir, Chairman of the Securities
Commission. The Association, jointly with IIAM and the Malaysian Institute of Accountants
(MIA), conducted a “roadshow” in all major towns to explain the requirements of the
Statement of Internal Control – Guidance for Directors of Public Listed Companies. The
Statement, jointly developed by KLSE and IIAM, provides useful guidance to directors in
complying with KLSE’s requirement on reporting on the state of the company’s internal
control in its annual report. The three bodies, in association with CPA Australia, also
organised a one-day seminar on the Revamped KLSE Listing Rules. In addition, the
Association supported a 2-day National Conference on Going Public, organised by the
Malaysian Institute of Corporate Governance (MICG) and the Federation of Public Listed
Companies (FPLC) in association with other organisations.
The requirement for CPE is not only emphasised in the accountancy profession, as the
regulatory authorities have also made CPE a mandatory requirement for capital market
participants. Under the revamped KLSE listing rules, all directors of PLCs are required to
attend continuing training programmes prescribed by the Exchange. The Securities
Commission has also made attendance at CPE a condition for renewal of licence by licensed
market intermediaries. In this regard, I am pleased to note that some of the courses conducted
by MACPA have been accredited by the Securities Industry Development Centre as approved
CPE courses. The Association has also been approved as a training provider by the Human
Resources Development Council (now known as Pembangunan Sumber Manusia Berhad)
under the Ministry of Human Resources.
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Public Practice
The major project undertaken by the Public Practice Committee during the year was the
development of the new MACPA website, macpa.com.my. The new website was launched by
Yg Bhg Datuk Ali Tan Sri Abdul Kadir, Chairman of the Securities Commission and a past
President of the Association, on October 24, 2000 in conjunction with the Association’s 42nd
Anniversary Commemorative Lecture.
The website contains a public area with general information on the profile of the Association,
its major activities, the CPA qualification and admission requirements, and news releases.
The website also contains an electronic information centre with a searchable database of
accounting and auditing standards and other information and publications pertinent to
members and students. An on-line library service is being developed to provide search on
books, articles and other publications available from the Association’s library and for making
on-line requests. The information centre is only accessible by members and registered
students of the Association using passwords. Non-members will have to register as a
subscriber to the website by paying an annual fee in order to access the information centre.
I am confident that members and students will benefit from the new website as they are now
able to access the Association’s technical resources on-line. It also improves the method of
information delivery and communication with members and students.
Members’ usage of the advisory service provided the Technical Reference Panel continued to
grow, especially among the smaller practitioners. Enquiries may be made by phone or in
writing relating to interpretation/application of accounting and auditing standards, company
and securities laws, tax legislation and ethical rulings. An increasing number of enquiries
have been received via e-mail and a number have made use of the one-line enquiry board on
the MACPA website.
There has been little progress on the new project relating to the development of a set of
sample audit working paper (AWP) to assist small practitioners in the conduct of an audit.
The Committee had focused its priority on the development of the new website.
Publication of the annual Budget Commentary and Ready Reference continued to be a highly
successful project. From a print-run of 5,000 copies when the first edition was published in
1993, it has grown to 29,000 copies for the 2000 edition. A copy of the publication was sent
to all members as part of membership service.
The Committee organised an informal gathering of members in March 2001 to provide a
forum for exchange of ideas and for fostering closer relationship among practitioners. A talk
on Forensic Accounting was presented at the gathering.
Commerce and Industry
Members in commerce and industry currently constitutes 42% of the total membership. They
are engaged in different management functions in various industries and commercial
organisations.
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The Commerce and Industry Committee is responsible for undertaking activities that are
relevant to this segment of the membership. To better serve the needs of this diversified
group of members, the Committee has formed three working groups – internal audit, financial
reporting and compliance and information systems. The Committee has invited the Institute
of Internal Auditors Malaysia (IIAM) and the Information Systems Audit and Control
Association (ISACA), Malaysia Chapter to participate in the working groups to promote
exchange of views on issues of common interest. As reported earlier, the Association joined
forces with IIAM in organising a National Conference on Internal Auditing focusing on
topics such as the role of internal auditors in a knowledge economy, corporate governance
and risk management. The Association also assisted ISACA in promoting its CPE
programmes to our members.
As part of CPE for members in commerce and industry, an evening talk on The Malaysian
Bond Market was held. The Committee is in the process of organising an e-business forum,
scheduled to be held in July 2001.
The Committee has also initiated a joint venture with the Asian Strategy and Leadership
Institute (ASLI) to organise a high level conference for chief finance officers. The conference
is intended to focus on the impact of e-business and globalisation on the finance function and
business growth. A panel of experts in the field will be invited to address the conference,
which is tentatively scheduled for November 2001.
The Committee continued to undertake review of International Management Accounting
(IMA) Practices Statements and Studies issued by IFAC. These publications provide useful
guidance on various aspects of financial management and management accounting which
may be suitable for application in members’ work. A commentary on each new IMA
Practices Statement and Study issued by IFAC will be published in the Association’s journal,
The Malaysian Accountant. Copies of the publications are provided free to members on a
request basis.
The Committee has reviewed a booklet entitled Setting Strategic Directions in Small and
Medium Enterprises: A Guide for Professional Accounting Advisors. The SME guide
provides a conceptual framework that accountants can refer to when assisting SMEs in
determining strategic directions and in implementing strategic initiatives. The framework is
supported by a series of 36 templates comprising questions and prompts for use in probing
and bringing to light strategic issues during discussions with management. The purpose of the
guide is to assist the SMEs to flourish in today’s fast-paced world and provide the
professional advisor/accountant with a structured approach that can be understood and
implemented easily. In view that SMEs form a vital part of the Malaysian economy, a copy of
the IFAC publication was extended to the Ministry of International Trade and Industry for
information.
The Committee also undertakes to review the articles of merit resulting from an annual
competition held by IFAC under an award programme for distinguished contribution to
management accounting. Where suitable, the articles will be reproduced in The Malaysian
Accountant for members’ reading.
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Government Relations
One of the important activities of the Council is to maintain effective liaison with
Government. I am pleased to note that the Association’s input has frequently been sought by
various Government and regulatory bodies on issues of significance. This is an
acknowledgement of the professional skills of our members.
The process of legislative reform relating to the operation of the capital market, governance
of companies and the income tax system continued in 2000. The Association participated
actively in the reformatory process by providing prompt feedback on proposed changes to the
various laws and regulations.
The Association continued to take part in dialogue sessions held by Government and its
agencies with the private sector. The Association was represented at the annual dialogue with
the Ministry of Domestic Trade and Consumer Affairs. A number of proposals relating to
protection of consumer interest in e-commerce, incentive for venture capital and provision of
business advisory service to small and medium enterprises were submitted to the Ministry.
The Association was also represented at the half-year meetings of the consultative panel
between the Royal Customs and Excise Department and the private sector.
Regular dialogues and technical level meetings were held with the Inland Revenue Board,
Bank Negara Malaysia and the securities regulators to discuss issues relating to compliance
and changes to their rules and regulations. This consultative process enables any practical
issues to be resolved before new rules and regulations are implemented. It also provides the
Association an opportunity to represent members’ views to the authorities.
Technical Activities
The Association is committed to developing high quality standards and guidelines to assist
members discharge their professional duties competently. This responsibility has become
even more important in the light of Government’s move to establish a capital market that
operates in a disclosure-based regulatory (DBR) framework. The key to achieving a
successful DBR is high standards of disclosure, which is dependent on the existence of a
body of high quality standards.
The Association’s technical work spans over a number of areas. Development and review of
auditing standards are a core activity. This involves not only review of International
Standards on Auditing for application in Malaysia but also the reporting responsibilities of
auditors and accountants under the various laws and regulations. The Association provides
constant updates to members on any changes in auditing and reporting standards and
statutory requirements.
The Association also participates actively in the standard setting process of the MASB. Many
of the members of our Accounting and Auditing Technical Committee are involved in
various MASB accounting projects. The Association itself also participates in MASB’s due
process by providing comments on MASB exposure drafts and discussion documents. In
addition, the Association undertakes to issue MASB standards promptly to our members for
application and monitor their compliance through a review process.
10
Apart from the traditional accounting and auditing functions, many of our members are
involved in financial management, business advisory service, information technology and
insolvency practice. The Association has formed specific committees to develop practice
notes and guidance to assist members in every sector performing their services effectively.
In addition to our internal agenda, the Association is regularly invited by the regulatory
authorities to review and participate in debates on their policies and guidelines relating to
corporate disclosure and governance.
In carrying its wide range of technical activities, the Association relies heavily on members’
involvement. In fact, members’ technical inputs are the single most important factor that has
enabled the Association to maintain its pre-eminent position as a professional body with
technical excellence.
Accounting and Auditing Standards
The Accounting and Auditing Technical Committee has a heavy work programme for the
year. Apart from its routine agenda, three major initiatives were undertaken during the year.
A Public Sector Working Group was appointed to undertake the review of International
Public Sector Accounting Standards (IPSAS) issued by the International Federation of
Accountants (IFAC). The objective is to determine their applicability in Malaysia and
whether there are any areas which are inconsistent with MASB standards. The Working
Group comprises representatives from accounting firms, the Accountant General Department,
the Auditor General Department and academia to ensure that all relevant constituencies
participate in the review process. The Working Group has achieved an impressive record
during its first year of operation. It completed the review of the first eight IPSAS and seven
exposure drafts issued by IFAC. Its comments on the exposure drafts have been duly
submitted to IFAC.
The Association will be having a meeting with the Accountant General Department and
Auditor General Department to discuss the Government’s stance on the adoption of IPSAS.
In the meantime, comments on IPSAS 1 – 8 and ED 9 – 15 have been posted on the MACPA
website for members’ information.
Following the completion of the revision of Model Holdings Berhad – Specimen Financial
Statements, a working group was formed to revise the specimen financial statements for
insurance companies, Model Insurance Holdings Berhad. The revision exercise, undertaken
in consultation with Bank Negara Malaysia (BNM), incorporated the requirements of MASB
Standards, current BNM guidelines and the Insurance Act 1996. The revised specimen
financial statements have been submitted to BNM for approval and issuance to the insurance
industry for application.
Under the revamped KLSE Listing Requirements, the board of directors of public listed
companies are required to make a statement in the company’s annual report about the state of
internal control of the company, and the statement is to be reviewed by auditors. The AATC
has appointed a joint working group with MIA to develop guidance for auditors in conducting
a review of the directors’ report on the state of internal control.
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The AATC’s work in the area of auditing standards has intensified with Malaysia’s
appointment to the International Auditing Practices Committee in May 2000. As the
profession is now part of the world standard setting process, we are obliged to devote
technical resources to support IAPC’s work. Specifically, Malaysia is assigned to three IAPC
projects:
Revision of ISA 240, Fraud and Error. The exposure draft of the revision of ISA 240, The
Auditor’s Responsibilities to Consider Fraud and Error in an Audit of Financial Statements
has been issued in April 2001 for comment.
Development of a new International Auditing Practice Statement (IAPS), Electronic
Commerce Using the Internet and Other Public Networks – Effect on the Audit of Financial
Statements.
Revision of ISA 220, Quality Control for Audit Work.
The AATC has also reviewed and submitted its comments on the exposure draft of the
revision of IAPS 1006, The Audit of International Commercial Banks and of IAPS 1004, The
Relationship between Bank Supervisors and External Auditors.
Within the Association, the AATC has undertaken a revision of the sample auditor’s reports
attached to ISA 570, Going Concern and ISA 700, Auditor’s Report on Financial Statements.
The AATC is also in the process of updating the MACPA Statement on Model Holdings
Berhad – Specimen Financial Statements to take into account the requirements of new
MASB Standards issued since the Statement was published in November 2000.
The AATC continued to review and provide responses on discussion documents and
exposure drafts issued by MASB from time to time. During the year under review, MASB
has issued 11 approved accounting standards, 2 statements of principles and 5 exposure
drafts. The Association has issued MASB 14 – 24 and SOP 1 as supplements to Members
Handbook. The effective dates of the new MASB standards are as follows:
MASB 14 – 16
MASB 17 – 21
MASB 22 – 24
Accounting periods beginning on or after July 1, 2000
Accounting periods beginning on or after July 1, 2001
Accounting periods beginning on or after January 1, 2002
Arising from an amendment to the SC’s guidelines on the format of submission of proposals
for initial public offerings and rights issue, the AATC has revised the specimen accountant’s
reports on profit/cash flow forecasts for inclusion in such submissions. The specimen
accountant’s reports will soon be submitted to the SC for endorsement.
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Company and Securities Law
The most significant regulatory reform was the implementation of the Securities Commission
(Amendment) Act 2000, which made far-reaching changes to the regulatory framework
governing fund-raising in Malaysia. The Act resulted in positioning the Securities
Commission as the sole regulator for such activities. It also requires issuers of securities to
provide sufficient and accurate disclosure of all material information to enable investors and
their advisors to evaluate the risks and merits of their investment. A new provision on civil
remedy is also introduced enabling investors to recover loss and damages arising from false
or misleading information contained in a prospectus. It is evident that the new legislative
framework requires higher standards of disclosure of information and enhances investor
protection.
Another major reform was the implementation of the revamped KLSE Listing Requirements
in January 2001, which brought into effect the Malaysian Code on Corporate Governance.
The new listing rules aim at enhancing disclosure of information by public listed companies,
raising the standards of conduct of directors and improving internal control mechanisms.
The amendments have significant impact on our members, particularly in their role as
auditors or professional advisors. The Association had deliberated on the amendments during
the consultation stage and provided its feedback to the regulatory authorities.
The Association also participated regularly in consultation meetings with the Securities
Commission to review various proposed new regulations/guidelines and amendments to
existing ones. These include amendments to the Malaysian Code on Take-over and Mergers,
regulations on shelf registration scheme and guidelines on prospectus, issuance of private
debt securities and asset backed securities.
The Association is a member of the Company Law Form, an informal group formed by the
Registry of Companies, the Bar Council, the Malaysian Institute of Directors, the Federation
of Public Listed Companies, MAICSA, MIA and MACPA. The Forum serves as a useful
platform for discussion of practical issues arising from the application of company law as
well as review of existing principles of corporate law. The Association undertook a review of
the proposed amendments to the Companies Act 1965 and submitted its comments to the
Forum for discussion.
Insolvency
The Insolvency Practice Committee is represented by all relevant interest groups – MACPA,
the Bar Council, the Associations of Banks, Finance Companies and Merchant Banks, and the
Official Receivers Office. The Committee serves as a useful forum for the discussion of
practical issues arising from insolvency management and administration. It also promotes
mutual understanding and harmonisation in approach and procedures.
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One of the major activities undertaken by the Committee during the year was the review of
the model insolvency law, a project sponsored by the United Nations Commission in
International Trade Law (Uncitral), to determine its applicability in Malaysia. The purpose of
the Model Law is to provide effective mechanisms for dealing with cases of cross-border
insolvency. It is procedural in nature and does not purport to affect the substantive domestic
law of insolvency applied in the country adopting the Model Law.
The Committee is of the view that it is in the interest of Malaysia to take steps to adopt the
Model Law. However, its implementation should not be effected until the country’s legal
infrastructure for insolvency administration has been strengthened and the Government is
satisfied that other countries with which Malaysia has significant trading relations have also
adopted or will adopt the Model Law so as to ensure reciprocity. The Committee’s
comments on the Model Law will be submitted to the Attorney General of Malaysia for
information.
The Committee is proceeding with the project on insolvency law reform. The project will be
undertaken in two stages. Firstly, to evaluate the current state of insolvency law in Malaysia
in comparison with that of Australia, UK and selected Asian countries. Secondly, to propose
a framework for an Insolvency Bill for Malaysia and if positive response is received from
Government, to prepare a draft bill.
The Committee plans to organise regular insolvency interest forums. The objective is to bring
together insolvency practitioners, lawyers, bankers and officers from the Official Receiver’s
Office and Attorney General’s Office to discuss topical issues in insolvency law and practice.
The forums will also serve as a venue for fostering closer co-operation and understanding
between the practitioners and Government.
The Committee, as a special interest group, is a member of INSOL international, an
international federation of insolvency professionals. This affiliation offers an opportunity for
update on significant developments in international insolvency laws and issues.
Taxation
The Taxation Working Group has had another busy year. Considerable resources were
dedicated to issues connected with the implementation of the new tax system.
The year 2000 saw the implementation of the current year basis of assessment and the
introduction of self assessment for companies, effective 2001. A number of dialogues were
held with the Inland Revenue Board (IRB) to resolve administrative and technical issues
arising from the implementation of the new tax regime. In addition, the Association also
participated in a technical consultative working group formed by the IRB to address practical
issues arising from self assessment. These activities are expected to continue until the self
assessment system is fully implemented in the year 2004, covering the other categories of
taxpayers.
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The Taxation Working Group continued to represent the Association at the dialogue between
the IRB and the major professional bodies involved in taxation to discuss and agree on the
2001 programme for filing income tax return forms. Resulting from representations made by
the Association and the other professional bodies, concessions were granted by the IRB in
terms of filing deadlines. A number of administration issues pertaining to the filing of return
forms by companies under the self assessment system were also raised for discussion.
A special dialogue was held in November 2000 to discuss tax issues arising from the 2001
national budget and the Income Tax (Amendment) Act 2000. Some of the most significant
issues arising from the proposed Amendment Act related to changes in the determination of
the basis period of a company and computation of deduction of tax from dividends (section
108).
The Taxation Working Group also participated actively in the IRB’s consultation process
relating to the development of Public Rulings. These Rulings are for the purpose of providing
guidance to the public as well as officers of the IRB on the interpretation of the Director
General of Inland Revenue in respect of a particular provision in the tax law, and the policy
and procedure that should be applied. To date, a total of 15 Public Rulings have been issued
by the Director General. The Association welcomes this initiative as it will assist taxpayers in
the application and compliance with the law.
As highlighted in last year’s annual report, the Working Group initiated an arrangement with
McGraw-Hill (Malaysia) Sdn Bhd, a well established publisher, to undertake the annual
publication of the CPA Tax and Investment Review. The publication contains updates on tax
laws and regulations; Government policies and guidelines on investment and incentives; the
procedures for incorporation of companies; guidelines on foreign investment and other
relevant information on doing business in Malaysia. It also provides a summary of recent tax
cases and current amendments to the tax law.
The inaugural edition of the publication was launched by the Minister of Domestic Trade and
Consumer Affairs, YB Tan Sri Dato’ Muhyiddin bin Hj Mohd Yassin, at the 42nd Annual
Dinner of the Association held on June 23, 2000.
The Taxation Working Group continued to represent the Association at the half-yearly
meetings of the Consultative Panel between the Royal Custom & Excise Department and the
private sector.
Communications and Public Relations
The Association’s public relations activities continued to focus on positioning the
Association as the pre-eminent professional body with technical excellence and promoting
the distinctive value of the CPA brand. In an environment faced with increasing competition,
even in the students recruitment market, adopting a focused marketing strategy is essential to
achieve our objectives.
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During the year, special emphasis was placed on promoting the CPA qualification. A series
of media interviews were held with the President of the Association and CPAs in various
professional fields. The media message is quite clear that the Association constantly places
emphasis on producing top calibre business professionals and that the CPA designation
stands for quality and technical excellence.
The Association also participated actively in career exhibitions and education fairs held
across the country. Regular career talks were presented to students at both secondary and
tertiary education institutions. The Association’s new video, The World of a CPA, has been a
helpful tool to enhance students’ perception of CPA as a high status qualification that opens
up to many business career possibilities.
Media liaison is an essential means to reach the wider community. Press releases were issued
from time to time on the Association’s major events. Media commentary was also provided
on issues of importance to the profession, business or society. The highlight of the year was
public relations activities held relating to the Budget Day. The Association participated in a
pre-budget and post budget commentary organised by a leading newspaper. A panel
interview with the media was held immediately after the Budget Speech was delivered by the
Minister of Finance on October 27, 2000. The Association also took part in a radio “talkshow” and contributed articles on the budget proposals to newspapers.
There is no doubt that constant media coverage of the Association’s opinions and activities
contributes significantly to reinforcing the Association’s professional profile.
MACPA Excellence Awards
The annual MACPA Excellence Awards Presentation Ceremony was held on October 28,
2000 in Kuala Lumpur. This is a special occasion for accountancy students as it is held to
give honour and public recognition to students who have performed with excellence in their
pursuit of an accountancy qualification. The awards are also intended to stimulate greater
inspiration amongst young accounting graduates and CPA students to strive for excellence.
This year’s presentation ceremony was officiated by YB Dato’ Seri Ong Ka Ting, Minister of
Housing and Local Government. The function was witnessed by over 300 students, their
family members, friends and guests of MACPA.
A total of Six Excellence Awards were presented to the Best Accounting Graduates from
UIA, UKM, UM, UPM, USM and Universiti Teknologi MARA (UiTM). The second
category of the Excellence Awards, the Most Outstanding CPA Student Award, was
presented to a CPA Student who has achieved all-round excellence – high distinction in the
MACPA examinations, exemplary career development and outstanding personal qualities. A
Certificate of Meritorious Achievement was presented to all the finalists for the Excellence
Awards.
Our students who passed the November 1999 and May 2000 MACPA examinations also
shared the limelight. A total of sixteen Gold and Silver medals were presented to the top
scorers and all successful students in these two examination sessions had the honour of
receiving the examination certificates from the President of the Association.
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42nd Anniversary Commemorative Lecture
In keeping with tradition, the Association’s 42nd Anniversary was marked by a
Commemorative Lecture, which was held on October 24, 2000 at the Renaissance Hotel,
Kuala Lumpur.
This year’s Lecture was delivered by our very own past President, Yg Bhg Datuk Ali Tan Sri
Abdul Kadir, who is currently Chairman of the Securities Commission. The topic chosen for
the Lecture, Beyond the Asian Financial Crisis – Challenges and Perspectives for the
Malaysian Capital Market, was most relevant. It provided an insight on the challenges that
the Malaysian capital market would face and the measures that need to be implemented to
strengthen and develop the market in the years ahead. Datuk Ali also highlighted that the
Securities Commission was in the process of drawing up a Capital Market Masterplan to
provide a comprehensive strategic “road-map” for the longer term development of the
Malaysian capital market.
New MACPA Website
The new MACPA web site represents a major initiative by the Council to expand the use of
technology as the primary mechanism for communication and delivery of services to
members and Students. The website will also serve as a platform for the Association to
promote the CPA qualification and its technical services to the wider community.
Members and students will be able to receive on-line services such as updates of technical
pronouncements, enquiries, registration for Association activities and access to a searchable
database of accounting and auditing standards, and other technical information. It also
provides convenient links to the websites of relevant Ministries, Government agencies,
Regulatory authorities, and national and international professional bodies to facilitate
information search.
The Malaysian Accountant
The Malaysian Accountant, a bi-monthly journal, is intended to serve both as a source of
reference on current developments in the profession and business, as well as a channel of
communication with members. Its content includes feature articles on current topics relating
to accounting, taxation, information technology, education and the national economy; regular
updates on IASC and IFAC; reports on corporate law cases and international news on
business and professional developments contributed by our overseas correspondent.
The journal continued to provide a medium for academics to disseminate their research
interests and findings.
Continuous efforts are taken to improve both the content and layout of the journal. The
editorial board welcomes members’ suggestions and contributions of articles.
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National Annual Corporate Report Awards
The National Annual Corporate Report Awards, or better known by its acronym NACRA, is
an annual event dedicated to promoting excellence in the presentation and reporting of
information by organisations to their stakeholders.
Jointly sponsored by the Kuala Lumpur Stock Exchange (KLSE), the Malaysian Institute of
Management (MIM), MIA and MACPA, NACRA has been a driving force in the continual
improvement of the quality of annual reporting in Malaysia.
When NACRA was first launched in 1990, compliance with approved accounting standards
and statutory disclosure requirements was given heavy emphasis to encourage all
organisations to meet these formal requirements. Over time as the capital market becomes
more sophisticated, so are the expectations from annual reports. The criteria for NACRA
have been reviewed and updated each year with a view to encouraging the improvement of
communications by organisations. Responding to the call by the capital market regulators that
public listed companies must maintain high standards of corporate governance, an additional
criteria was introduced relating to the disclosure of information on corporate governance.
Recognising the need to reflect important emerging trends, an Environmental Reporting
Award was introduced in 2000 to encourage best practices in the reporting of environmental
initiatives and issues.
The presentation ceremony for NACRA 2000 was held on November 8, 2000 at the Palace of
the Golden Horses, Kuala Lumpur. Officiated by YB Tan Sri Dato’ Muhyiddin bin Hj Mohd
Yassin, Minister of Domestic Trade and Consumer Affairs, the function was attended by over
900 guests and NACRA participants. This large gathering clearly indicated the significance
of the event.
In his speech, the Minister echoed NACRA’s objective in encouraging companies to use the
annual reports as the vehicle for communication with their shareholders, potential investors,
major customers, employees and other stakeholders about the company’s business strategy,
management style, future prospects and other corporate information.
Kumpulan Guthrie Berhad emerged as the top winner for the third consecutive year. The
company won the Overall Excellence Award for the Most Outstanding Annual Report of the
Year and the NACRA Challenge Trophy. It also walked away with the Award for Best
Annual Report in Bahasa Malaysia, while Island & Peninsular won the Best Designed Annual
Report Award.
The new award titled Best Annual Report in Environment Reporting, is intended to promote a
“green and fair view” in corporate reporting. The objective of the Award is to enhance
awareness that environment is an integral part a company’s decision-making process and to
give due recognition to efforts undertaken by companies towards preserving the environment
and promoting sustainable development. Golden Pharos Bhd emerged as the winner of this
inaugural Award.
A Certificate of Merit was presented to 17 finalists in recognition of the commendable high
quality of their annual reports.
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Professional Conduct
Financial Statements Review
The Financial Statements Review Committee undertakes the important task of monitoring
members’ professional conduct with regard to compliance with technical and professional
standards and statutory requirements in carrying out their professional work. This is done
through an on-going programme of review of published financial statements audited by
members. Any deficiencies noted by the Committee will be communicated to the members
responsible and explanations sought for the occurrence. In cases of significant departures,
follow-up reviews will be carried out to ensure that these have been rectified.
The review process is also a valuable feedback tool on whether there are any difficulties
encountered by members in the interpretation or application of particular standards.
It is pleasing to note that members have viewed the review process as a means to maintaining
high standards of financial reporting in Malaysia.
Investigation and Disciplinary
During the year, the Investigation Committee considered three cases of complaints. Of these,
one case was referred to the Disciplinary Committee. In the other two complaints, the
Committee determined that a prima facie case had not been made out against the members
concerned and thus, no further action was taken. No new complaints were received at the
time of this report.
The Disciplinary Committee received one case of complaint during the period and hearing of
the case was pending.
International Relations
I am pleased to report that in May 2000, two of our Council members were appointed to the
Committees of the International Federation of Accountants (IFAC). Yg Bhg Dato’ Abdul
Halim Mohyiddin, Chairman of the Association’s Education and Training Committee, was
appointed to IFAC’s Education Committee while Mr Sukanta Dutt was appointed to the
International Auditing Practices Committee. The appointments provide Malaysia an
opportunity to be directly involved in the world standard setting process.
As a member of IFAC and the International Accounting Standards Committee (IASC), the
Association supports their objectives in promoting international harmonisation of the
profession in two ways. The Association has actively promulgated the application of
International Accounting and Auditing Standards in Malaysia. The Association also
participates in the due process for setting standards by providing input on discussion papers
and exposure drafts of proposed standards issued by IFAC and IASC. Through the initiatives
of the Association, International Accounting and Auditing Standards have been adopted or
adapted for application in Malaysia since the first standards were issued in 1975.
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Apart from auditing standards, IFAC also develops standards and guidelines in other areas
including public sector accounting and financial reporting, education, ethics, financial
management, management accounting and information technology. These standards and
guidelines serve as useful guidance and benchmarks for setting Malaysian standards. The
Council has appointed a Public Sector Working Group to review International Public Sector
Accounting Standards issued by IFAC to determine their applicability in Malaysia. The
Association has also used the International Education Guidelines as the benchmark for setting
the Association’s education standards.
With increasing globalisation and inter-penetrability of capital markets, the need to conform
with international standards has became more critical than before. This is particularly so in
view of the World Trade Organisation’s (WTO) move to liberalise trade in services. To
ensure our strong position in any negotiations for reciprocity in the provision of accounting
services and mutual recognition of professional qualifications under WTO, our accounting,
auditing as well as educational standards must be at par with the international benchmarks.
At the regional level, the Association maintains its membership with two regional bodies, the
Confederation of Asian and Pacific Accountants (CAPA) and the Asean Federation of
Accountants (AFA).
Registered Students
During the year, the Association registered a total of 170 students comprising predominantly
graduates with accounting degrees. As compared to 1999, there had been a drop in new
student intake by 16%. After taking into account 82 students who were excluded from the
register of students for non-payment of annual fees, 139 students who terminated their
registration and 115 students who were admitted as members or provisional members, the
total number of registered students stood at 1,198 at December 31, 2000. This represented a
decline in student population by 12% as compared to the previous year.
The Council is concerned with the continued decline in student enrolment. A dialogue was
held with the major training offices to determine the cause for the decline. A major
contributory factor is the increasing competition in the students recruitment market as more
options for professional training are offered by various overseas bodies. There is a clear trend
that graduates with foreign degrees would pursue a professional qualification offered by the
accountancy body from the respective country.
The Council has taken these factors into consideration in re-structuring the Association’s
examination and training programme. The Council is confident that the new CPA
qualification, to be introduced at end of 2002, will be able to attract a large number of quality
graduates.
The Association provides for three main streams of student registration. Stream I is for
students who are serving a training contract in a firm of public practice; Stream II for those
who are serving a training contract in an approved training organisation in commerce,
industry or the public sector; and Stream III for those who have elected to follow a full-time
course of study to prepare for the MACPA examination and to undergo the practical training
at a later stage.
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A special stream of registration is also available for graduates with an approved degree in
accountancy from a local university. Classified as Special Stream III, it permits eligible
graduates to register as a student of the Association without having to sign a training contract
with a MACPA member for the first two years of their registration. Upon completing the
final part of the MACPA examination, they will be entitled to become provisional members
of the Association while undergoing the necessary practical training to meet the requirement
for admission as a full member. The purpose of this stream of registration is to encourage
accounting graduates to sit for the MACPA examination immediately upon completing their
degree programmes. It continued to be a popular option and accounted for 23% of the total
new admissions in 2000.
Stream II – Training Outside Public Practice
The Stream II training scheme offers the students the option to obtain their practical
experience in an approved training organisation (ATO) in commerce, industry or the public
sector. However, like in Stream I, they are required to serve a 3-year training contract under
the supervision of a member of MACPA.
Currently, there are 94 ATOs under Stream II. The number of students registered under this
stream totalled 102 at December 31, 2000.
The Council recognises that the current regulation may restrict the opportunities for training
under Stream II as some organisations do not have CPAs in their employ. This issue has been
addressed in the restructuring of the Association’s examination and training system. Under
the proposed new CPA qualification, students in Stream II will not be required to enter into a
training contract. Work experience may be obtained under the supervision of a member of
MACPA or one of the professional bodies approved by MACPA and the student is required
to maintain a training log book as a record of his work experience. The Council hopes that the
flexibility provided will encourage more employers to join the CPA training scheme.
Examination
A total of 1039 examination entries were received from registered students for the May and
November examinations in 2000. Of these, 102 entered for Professional Examination I and
937 for Professional Examination II. In addition, 122 candidates sat for the company law and
advanced taxation papers for the purpose of gaining admission to membership under Article
3(b).
The total number of examination candidates had decreased by 15% as compared to 1999, due
to a decline in student enrolment. The significant drop in the number of candidates sitting for
Professional Examination I was a consequence of a continued shift towards intake of students
with accounting degrees who were eligible for direct admission to Professional Examination
II.
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Enrolment for MACPA Examinations
No of Candidates
2000
1999
Professional Examination I
Module 3
41
57
Module 4
61
117
Module 5
407
489
Module 6
530
560
Article 3(b) candidates
122
148
Professional Examination II
Education and Training
The Education and Training Committee was preoccupied with two major tasks –
development of the detailed syllabuses for the proposed new CPA examination and
evaluation of diploma/degree courses as entry qualifications to the CPA programme.
The proposed new CPA qualification consists of two levels of examinations. The first level, a
Professional Stage Examination, is intended to provide a sound grounding on the concepts
and principles of accounting and business management for the development of advanced
learning. It consists of six subjects covering financial accounting and reporting, taxation,
auditing, company law, management information, and business finance and management.
The second level, the Advanced Stage Examination, emphasises the technical and strategic
business skills required of new CPAs. It consists of three subjects covering advanced aspects
of financial accounting and reporting, taxation and business management.
The Committee appointed three subject working groups to prepare the detailed syllabus
content for each subject. Members of the working groups are drawn from the institutions of
higher education, public practice and industry. The first draft of the syllabuses was completed
in September 2000 and submitted to the Council for comment. The syllabuses are currently
being revised to take into consideration the views of the Council. It is expected to be finalised
by end of June 2001 for comment by members and relevant interest groups.
The next task of the Committee will be to undertake a review of the 3-year practical
experience component required for membership admission. The focus will be to reinforce
hands-on IT training for students and to provide guidance to principals/training supervisors in
monitoring the students’ practical training.
The Committee continued to undertake the evaluation of diploma/degree courses conducted
by both public and private institutions of higher education as entry qualifications to the CPA
programme. The outcome of the evaluation will also form the basis for determining the extent
of exemption that may be granted from Professional Examination I.
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During the year, the Committee completed the evaluation of the Bachelor of Accounting
degrees offered by Multimedia University and Universiti Tenaga Nasional (UNITEN). These
two degrees have been approved by the Council as entry qualifications to the CPA
programme and for partial exemption from Professional Examination I. Evaluation of a
number of diploma/degree courses are in progress. These include the MBA (Accountancy)
degree from Universiti Malaya, Diploma/Advanced Diploma in Business Studies
(Accounting) from Kolej Tunku Abdul Rahman, Bachelor of Accounting (Information
Systems) from Universiti Utara Malaysia, Bachelor of Management (Accounting) from
Universiti Teknologi Malaysia and a number of degree programmes (with concentration in
accounting) conducted by private colleges under twinning arrangements with overseas
universities. The Committee views the evaluation as an essential process for ensuring that we
have a steady stream of high quality young graduates joining the profession.
The year saw the production of the complete set of study manuals for the Association’s
examination, undertaken by a professional publisher that specialises in accountancy and
financial training. The study manuals were launched in August 2000 by the President of the
Association. The Council hopes that the study manuals will serve as effective tutorial
assistance for the MACPA examination.
The Committee continued to provide other examination assistance programmes to students.
These include weekend tutorial courses, pre-examination intensive revision courses and free
copies of past examination questions and suggested answers.
Another core function of the Committee is to provide continuing professional education to
members. In this regard, the Committee has worked in co-operation with other committees,
particularly the Accounting and Auditing Technical Committee, Public Practice Committee
and Commerce & Industry Committee to ensure that the CPE needs of various segments of
the memberships are taken into account.
MACPA Educational Trust Fund
The MACPA Educational Trust Fund (ETF) was founded in 1981 by the Council of the
Association to promote education and research in accountancy and related fields.
The ETF continued to offer scholarships to assist young Malaysians with outstanding
academic record but were financially handicapped to pursue a higher accountancy
qualification. A total of three scholarships, each worth RM4,500 per annum, were awarded in
2000. Presently, a total of 9 students are under the ETF scholarship scheme pursuing the
Bachelor of Accountancy degree at public universities.
The ETF has commissioned a research team from the Faculty of Business and Accountancy,
Universiti Malaya to undertake a research study in the following areas:

Rotation of auditors – to investigate the perception of auditors, auditees and regulators on
rotation of auditors and the implications on independence of auditors and effectiveness of
audit performance.

A comparative study of the factors influencing the determination of auditors’ fees.
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Restoration of the ETF building has been delayed due to non-approval of the plan for
structural alteration to the ETF building by Dewan Bandaraya Kuala Lumpur (DBKL). A
revised plan has been submitted to DBKL for approval.
Acknowledgement
It is a great honour for me to serve as your President for a second term and to lead the
Association into the next millennium. The past year has been both challenging and
demanding, especially as I take on the additional responsibility as President of MIA.
I am very much indebted to my colleagues on the Council for their sound advice, unfailing
support and dedication. Serving on the Council demands sacrifices of time and energy, and
that has been given so unstintingly by our Council members.
At the heart of the Association’s activities is, of course, the active involvement of members. I
wish to acknowledge the significant contributions made by so many members to the
Association’s committee work. It is the input of their technical knowledge and expertise that
has enabled the Association to maintain the highest standards of excellence.
I would like to extend particular appreciation to Ms Tan Shook Kheng and her Secretariat
team for their hardwork and commitment. The Secretariat provides invaluable support to the
Council and committees in carrying out their agenda. They are also the frontline people
providing services to members and students.
We have an exciting year ahead of us in view of the many important changes that will be
implemented within the Association and of the new developments in the profession. I am
confident that with the continued support and commitment of members, the Association will
be able to achieve its new goals with success.
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