Question

What are the perceptions of professional accountants in Malaysia, Singapore, and Indonesia of the role of societal institutions such as governments, the media, and professional accounting bodies in the adoption of the IFRS?

Answer 1

The main thrust of our recommendation is to revamp the governance structure of the accountancy profession, replacing the MIA with a new structure with better checks and balances including better clarity in the reporting lines to the Minister of Finance and creating specific structures which will address the key issues of the accountancy profession. The relationship between the new regulatory body with other stakeholders such as the professional accountancy bodies and institutions of higher learning are clarified. We envisage that the new structure will take some time to develop further strategies to bring the accountancy profession forward. Hence, the CSAP takes this opportunity to provide recommendations in areas where the profession can be further strengthened; especially to increase the number of professional accountants and ensure specific competencies and skills are made available to support the demands of corporate and public sectors While some of the measures undertaken in the past have placed the Malaysian accountancy profession at its current level, future success will depend on how the whole profession is set up to take on the challenges of future.

The key thrusts of the recommendation herein are: • Introduce a new regulatory structure which will strategise and develop the accountancy profession while promoting public interests through the formulation and enforcement of professional standards; • Ensure adequate supply of professional accountants for the economy that fulfills market expectations in terms of knowledge, skills and values; • Improve the effectiveness and efficiency of the disciplinary structure for the enforcement of professional standards to ensure protection of public interest; • Ensure financial support for education, research and capacity building for the accountancy profession; • Create a conducive and inclusive environment to attract students to pursue professional accountancy profession; • Foster support to MIA members to enhance their skills and competency to match market expectations;

It is recommended that a new regulatory body (hereinafter referred to as “NRB”) be established in Malaysia. The objective of the NRB is to ensure that the accountancy profession is effectively regulated. The NRB will also be tasked to develop the accountancy profession and ensure key issues pertaining to the profession are dealt with appropriately with no duplication of efforts. All accountants in Malaysia will need to be registered with the NRB. The NRB will consist of a Supervisory Board and three operational boards focusing on professional conduct, standard setting and education. The Supervisory Board will be responsible to oversee the overall development of the accountancy profession in Malaysia. In doing so, it would consider strategies, operational activities and the budgets of the three boards under its supervision. It should have adequate power to enforce professional standards and other rules within the purview of the NRB. Upon its establishment, the Supervisory Board is expected to formulate a detailed blueprint to develop the Malaysian accountancy profession across all critical areas. Members of the Supervisory Board will be appointed by and report to the Minister of Finance. It will have its own governance structure such as the Nomination Committee and Audit Committee. The Supervisory Board will appoint the members of the other boards under its supervision. The Supervisory Board will be supported by a management team led by a chief executive. The management team will also be responsible to support the operations of the other boards within the NRB structure, such as conducting investigations, supervising accountants in public practice and leading accountancy research. This will enable the NRB to consolidate all regulatory roles relating to the accountancy profession under the ambit of NRB.