THE YEAR UNDER REVIEW

It has been another year of great challenges and opportunities for the Institute and the accountancy profession in Malaysia. The Institute, in facing up to the challenges, has continued to chalk up milestones towards achieving its vision to be a globally recognised and respected business partner committed to nation-building. The Institute has strenuously pursued its mission to develop the full potential of the accountancy profession in this country through various programmes, activities and projects for the benefit of the members as well as the community and nation.

The Institute has a heavy responsibility to bear and I am glad to report that with the support of members, regulatory authorities and other stakeholders, and the Secretariat, we have made major strides to achieve the Institute's vision and mission. I would especially like to thank the Accountant-General and his officers for their tremendous support.

The Institute continues to be guided by its Strategic Blueprint - Implementation Phase (SBIP) document. To translate the strategic initiatives into operational terms and for effective performance measurement, the Balanced Scorecard system has been adopted by Council and a firm of consultants is guiding and assisting the Institute to develop the corporate strategy map and scorecards. Another major operational project on the Institute's infrastructure currently being undertaken is the e-MIA Total Management System. Due to new enhancements and extensive testing, there has been some delay in its implementation. The project is however back on track and the major phases of the project including the new web portal, will be completed soon.

Members will note that the format of the Report of the Council for 2004 has been changed in line with the Motion adopted by members at the Institute's 17th Annual General Meeting last year. Members would be able to gauge the progress and development of the Institute according to the functions entrusted to it under the Accountants Act 1967.

I would like to highlight some of the major achievements of the Institute. This would include ongoing programmes and new initiatives.

Practice Review Programme

The Institute has during the year continued to develop and refine the various aspects of the practice review programme. 25 panel reviewers have been appointed and training was conducted for them as well as for the internal reviewers. Notifications of review were sent to randomly selected audit firms, field reviews were conducted and as at 30 June 2004, the review of four audit firms have been completed.

MIA Qualifying Examination

Since the launch of the MIA Qualifying Examination (QE) last year, two examination sittings have been successfully conducted. The response to the MIA QE, which provides an alternative pathway for graduates who do not possess a qualification recognised by the Institute to be admitted as members of the Institute, has been encouraging and two candidates have fully completed the MIA QE.

Accountants Today

The Institute's magazine, Accountants Today, has received encouraging feedback from members since it was revamped in July 2003.

Progressive Liberalisation of Trade in Services

The Institute continued to be actively engaged in promoting the interests of the profession in Malaysia by participating in dialogues and enhancing co-operation and collaboration with the various countries and accounting bodies at international and regional levels. To ensure that the interests of member and member firms are not compromised in the face of external pressures arising from the liberalisation of trade in services, the Institute has continued to work closely with the Ministry of International Trade and Industry (MITI), National Economic Action Council (NEAC), National Professional Services Action Council (NAPSEC) and the Professional Services Development Corporation (PSDC). A comprehensive strategy document, contained in a booklet entitled "Globalisation and Liberalisation of Trade in Services - Challenges and Directions for the Malaysian Accountancy Services Sector" was published by the Institute and distributed to all member firms and other key stakeholders. It is also available on the Institute's website.

In view of the difficulty of achieving multilateral agreements among ASEAN countries in the accounting sector, the Institute had proactively pursued bilateral negotiations with fellow ASEAN countries. This has resulted in the signing of a Memorandum of Understanding (MOU) with the Indonesian Institute of Accountants (IAI), a first for both nations.

New Initiatives and Collaborative Efforts

To achieve its vision and mission, the Institute is fully aware that it cannot work alone but requires the support and co-operation of other stakeholders such as the regulatory authorities, professional bodies and universities.

Two new awards to promote the profession were launched during the year. The inaugural National Award for Management Accounting (NAfMA) Best Practice is organised jointly with The Chartered Institute of Management Accountants (CIMA), Malaysia Division while the Best Internal Audit Practice Award (BIAPA) is being organised jointly with the Institute of Internal Auditors Malaysia (IIAM).

The Institute has always strived to work closely with the regulators and other government agencies for the benefit of members as well as to uphold public interest. Among many new initiatives, the Institute has submitted a proposal to the Small and Medium Industries Development Corporation (SMIDEC), and met with SMIDEC to discuss the definition of small and medium practices and the types of facilities that could be offered to members.

Last year, the Institute had issued an Exposure Draft on a proposed new By-law on Professional Independence which was based on Section 8 of the International Federation of Accountants Code of Ethics. After taking into account the comments from members, regulatory authorities and other public interest groups, amendments were made and the new By-law was issued this year. This new By-law is benchmarked against international standards whilst taking into account national laws and local circumstances. To assist members with the compliance of this new By-law, a series of nation-wide briefings has been organised.

The Anti-Money Laundering Act 2001 (AMLA) will soon be extended to accountants and company secretaries. To assist our members in understanding and complying with the new obligations under the AMLA, a detailed Guidance on Anti-Money Laundering for accountants and company secretaries who are members of the Institute was drafted and issued to members. In addition, a series of nation-wide programmes to create awareness and provide information on the AMLA has been organised. In this respect, the Institute has worked very closely with Bank Negara Malaysia (BNM).

Going Forward

The year has been a tremendously challenging one for the Institute as we tackled and managed both internal and external challenges. However, with the continuing support of our members, stakeholders and associates, together with the unfaltering commitment and dedication of the Secretariat staff, we have overcome the challenges and made considerable progress. To all of them, I wish to extend my heartfelt thanks.

I look forward to another outstanding year for the Institute as we continue the journey towards our shared vision of excellence and integrity in the profession for the benefit of all.



DATUK DR ABDUL SAMAD BIN HAJI ALIAS
President
Malaysian Institute of Accountants