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THE YEAR UNDER
REVIEW
 The financial year ended 30 June 2007 had
been formative both for the profession and the Institute and we have grown in
stature. When I assumed the Presidency of MIA two years ago, I was committed to
advancing the strategies established by the previous Council and to facilitate
even greater achievements for the profession and the Institute. With the support
of Council and members, we achieved most of the various initiatives and
objectives as underlined in the Institute’s Strategic Blueprint. The Institute’s
Strategic Blueprint which was developed to ensure the effective execution of the
functions entrusted to the Institute under Section 6 of the Accountants Act,
1967 and was translated into a corporate strategy map, has proven to be an
effective tool in the implementation of the strategic initiatives and
performance management.
The Institute has over the past year focused on several critical areas, which
are among others: (1) Proposed Amendments to the Accountants Act 1967; (2)
Globalisation and its challenges and (3) Strengthening linkages at professional,
national and international levels and forming alliances with those who share our
concerns for enhancing the profession.
This annual report describes our initiatives in each of these areas. I would
like to highlight some of them.
STRENGTHENING THE PROFESSION
Amendments to the Act
The Institute has proposed the amendments to the Accountants Act 1967, which
last saw major changes six years ago, to ensure that the Act remains relevant
and dynamic to meet the challenges and requirements of the accountancy
profession in Malaysia. It is vital and tremendously important that the
professionalism, competencies and ethical values and attitudes of accountants
are of high standard and in accordance with global benchmarks. A major component
of the review has been to look at the way the accountancy profession is
currently governed and to consider the improvements that should be made to
ensure a more effective system. The review has resulted in proposals covering
various issues such as improving the regulatory and compliance processes and
managing issues related to education and globalisation.
The Institute has initiated a public consultation exercise to seek comments on
the proposed consultative document. The Consultative Document sets out a
discussion on ways to improve the regulation of the profession and other matters
which will contribute to the enhanced performance of the members of the
Institute. The public consultation on the Consultative Document will end on
September 15, 2007. I would like to take this opportunity to express my sincere
hope that the stakeholders and members will provide valuable comments and
insights through active participation in the consultation exercise.
Globalisation and Challenges
Much as we would like to remain protective, international pressures have been
gaining momentum for total liberalisation of trade for us to remain relevant
particularly as we are a signatory of the General Agreement on Trade & Services
(GATS) and a member of the World Trade Organisation (WTO). Trade in services is
undergoing global metamorphosis that would eventually traverse national
boundaries completely.
As new opportunities are created through a more open and internationalised
economy and society, we will definitely be exposed to new risks. To maintain our
global competitiveness, we must keep pace, or we will be left behind. I would
like to urge members to brace themselves and form a strategic integration of our
profession in the business and economic sector, thus, making us indispensable to
our country both in the local and international context.
As Malaysia seeks to attract and establish global businesses and investments,
our accounting standards have to be internationally recognised and be responsive
as well as relevant to a rapidly changing business environment. The Institute
views the Mutual Recognition Agreements (MRA) between MIA and Ikatan Akuntan
Indonesia, and MIA and CPA Australia as a very favourable step that is geared
towards the betterment of the profession. I certainly hope that these MRAs will
further enable our members and give them a stronger footing in the global
marketplace.
Moving forward, the Institute continues to keep pace with international best
practices and standards and at the same time stay anchored to its core values of
integrity and independence. We should all work together to contribute to the
economic growth and stability while serving the public interest. Indeed, once
political stability is proven in any country, it is professionals like us who
then become the trusted third party facilitating the creation of business
relations and investment. The credibility of the professionals therefore has an
impact on the financial markets and this leaves indelible marks on the success
or otherwise of our economy.
Financial Reporting Standards Implementation Committee (FRSIC)
The Malaysian capital market embraced the FRS issued by the Malaysian Accounting
Standards Board (MASB) effective from 1 January 2006. The new standards which
are in line with the International Financial Reporting Standards (IFRS) issued
by the International Accounting Standards Board (IASB), facilitates the
convergence of accounting standards globally.
FRSIC is another initiative by the Institute to provide assistance to members on
matters of common interest relating to financial reporting standards by way of
providing implementation guidance to both preparers and auditors. The Institute
is committed through collaboration with the professional bodies, standard
setters and regulators to ensure our implementation guidance represents
international best practice.
However, the main reason for having implementation guidelines is not to provide
a cookbook solution to every practice-related problem, but to aid in the
implementation process for situations that involve financial statements
reporting. Preparers and auditors will encounter situations in their jobs that
will need guidelines to handle them effectively. These guidance notes will
become best practices which MIA members should follow. However, in carrying out
their responsibilities as professionals, members should exercise sensitive
professional and moral judgement in all their activities.
MOVING FORWARD
World Congress of Accountants 2010
The Institute is already working hard to ensure that the 18th World Congress of
Accountants (WCOA) which will be held in Kuala Lumpur in November 2010 will be a
success. The Institute is presently involved in promotional and publicity
efforts as well as preparing itself to ensure the outstanding success of the
event. The permanent WCOA 2010 Steering Committee will comprise people who are
instrumental in ensuring the success of the event. Equally important, this
committee should possess a strong sense of continuity to maintain the momentum
that has been built for the congress. In addition, the Government has given its
full support towards the organising of the congress and has provided a RM10m
grant. The congress will certainly put Malaysia in a global spotlight and will
serve as a strategic platform to springboard the Malaysian accountancy
profession into the world market.
40 Years of Walking the Values
The Institute celebrates its 40th Anniversary in 2007 which includes the
affirmation “MIA: 40 Years of Walking the Values.” It is a time to celebrate a
milestone as well as to reflect on the past and where we are today. Looking
back, the Institute and the profession have had several good men who built a
firm foundation for the profession through steadfast character, integrity and
selflessness. They were the quintessence of the all-rounder with incredible
skills and firm believers of these values -integrity, independence, honesty and
objectivity. They gave their time and talents without complaint, not just to the
Institute and the profession but to many other worthy causes. Forty years after
MIA’s establishment, the Institute and the accountancy profession has kept along
that same trail of footprints left by these pretty good bunch of fellows. All
these are being well documented in the MIA’s 40th Anniversary Commemorative
Book.
Membership
With the fast economic growth of the country, accountants are highly sought
after and well respected. However, I would like to emphasize that much as we
wish to increase the number of our members to meet the demands of the nation, we
do not compromise on the quality of members admitted. The Institute currently
has a total membership of over 23,000 and probably the largest number of
professionals as compared to other professional institutions. But the strength
of a professional body is not measured by its size. Rather, it is measured by
its ability to lead the profession to respond to changes, to shape public
opinion on key issues, to contribute to international development, and to chart
new frontiers.
I would like to say that accountants are about persons and personalities who
possess the right traits, specialised skills and live by a code of ethics and
integrity. To carry the title ‘Accountant’, one must assume the tremendous
weight and responsibility that comes with it. This means that when called upon,
we can do the job without fear or favour. We speak our mind and give our views.
When faced with absolute wrong, we can firmly disagree and walk away. Similarly,
the Institute continues to embrace the emergence of members who are visionaries
with steel in their backbones, compassion in their hearts and who will be
prepared to put their hands to the plough, for the interest of the profession.
Corporate Social Responsibility
As the saying goes ‘To educate a person in mind and not in morals is to educate
a menace in society’. One way of helping accounting students to inculcate good
values and have strong character is to expose them to relevant working
experience or internship. With its mission to be a respected business partner
committed to nation building, the Institute launched its MIA e-Career in
November 2006 which aims at ‘matchmaking’ the potential employers, who are the
MIA member firms with the accounting graduates. It is hoped that the current
trend where accounting graduates venture into different career fields upon
graduation, as a result of lack of knowledge, can be improved.
I strongly believe that students who are the next generation must be taught
those values that the profession lives up with and not be left to acquire them
by chance. Working with the member firms should provide students with an
authentic learning environment for character education. I am sure these students
will have picked up useful lessons on hard work and values.
ACKNOWLEDGEMENTS
I wish
that the accounting fraternity, standard setters and regulators could continue
to collectively join our efforts to ensure the most effective solutions are
applied to overcoming the challenges ahead. I believe, if we do this
successfully, we will all share the results of our efforts and our profession
will have the cutting edge and the stakeholders’ confidence will be restored.
On behalf of the Council, I wish to thank our stakeholders whose support and
cooperation extended to us have assisted the Institute tremendously in advancing
the profession. My thanks also goes to the Accountant-General, Dato’ Mohamad
Salleh Mahmud for his invaluable support in bringing the Institute and the
profession to greater heights.
Finally, I would like to extend my heartfelt thanks to my fellow Council Members
who have demonstrated their fullest commitment to the betterment of the
Institute and the profession. Their leadership and the dedication of the
Registrar, Encik Mohammad Abdullah and the Executive Director, Ms Ho Foong Moi,
as well as the Institute’s Management Centre have been fundamental in enabling
us to achieve meaningful changes that position our profession better to fulfill
its vision and continue to grow from strength to strength.
Abdul Rahim Abdul Hamid |