Guarding the standards of the accounting and auditing profession.

 

Kuala Lumpur, 15 October 2010

The convergence of Malaysian Financial Reporting Standards (FRS) to International Financial Reporting Standards (IFRS) is vital in attracting more foreign investment to Malaysia. Increasing foreign investment is in line with our economic plan to transform Malaysia into a developed and high-income economy. Full adoption of IFRS will help with this plan by increasing the transparency and credibility of financial reporting in our country.

April Mackenzie, Global Head of Public Policy and External Affairs for Grant Thornton International said, “After the corporate scandals from recent years, the pressure and demand for transparency in corporate financial reporting has increased; therefore it is crucial for companies in Malaysia to grow competitively by being more transparent especially with respect to financial reporting.”

When asked about the cost of convergence, April said, “There will be an initial cost of convergence to IFRS, but in the long run the costs should not be significant. The Malaysian Accounting Standards Board and the Malaysia Institute of Accountants should invest in organising a good channel of delivering proper and adequate knowledge of the new standards to the profession. Investments will also be performed in schools and universities. With education, graduates will be equipped with proper knowledge on the new financial reporting standards.”

Apart from the adoption of the world language of IFRS, effective regulation of the audit profession is important to the reliability of financial reports. A key change in the regulation of the audit profession in recent years is the establishment of independent audit regulators in countries around the world. In this particular area, the Audit Oversight Board in Malaysia has recently been established.

When asked about her views on the roles of the Audit Oversight Board (AOB) and corporate scandals, April said, “The creation and existence of the AOB is a very positive step for Malaysia and is in line with global best practices. However, independent audit oversight is just one aspect of combating corporate scandals. It is also very important for companies to have strong corporate governance standards, and the integrity of directors and management is another critical pillar in sound financial reporting. Each piece of this system plays its part; should any part break, corporate scandals may happen.”

“The AOB can also play its role in boosting market confidence of audit quality by performing unbiased and constructive inspections of audit firms and by working collaboratively to seek improvements in audit quality in Malaysia,” she continued.

For us at Grant Thornton, it is important to remain active in the accounting and auditing profession by contributing to the discussions of how the capital markets should function. Our global reach and resources allow us to focus on the quality of financial reporting and audit, which is most crucial to us. Grant Thornton is a growing, dynamic organization, and we look forward to working with organizations that show the same quality.

 
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For further information please contact:
Charmane Koh
Corporate Affairs Executive
T +603 2692 4022
E charmanekoh@gt.com.my

Notes to editors:

About April Mackenzie:
April Mackenzie is Global Head of Public Policy and External Affairs for Grant Thornton International and is currently based in New York. Prior to joining Grant Thornton, Ms Mackenzie spent 10 years in an executive management role at the New Zealand Institute of Chartered Accountants as Divisional Director of Policy. She has also played a key role in the initial development of international public sector accounting standards through her role as Technical Advisor to the chair of the International Federation of Accountants public sector accounting standards board.

In her current role with Grant Thornton International, Ms Mackenzie is responsible for developing and maintaining relationships with key regulators and international standard setters; representing Grant Thornton International on the Global Public Policy Committee of the six largest global auditing networks; and is a member of the International Accounting Standards Board Standards Advisory Council.

About SJ Grant Thornton:
SJ Grant Thornton is a member firm within Grant Thornton International Ltd and provides assurance, tax, corporate finance, corporate restructuring and management consulting services.
The firm operates from its main office in Kuala Lumpur and its other offices in Penang, Johor and Kuantan.

About Grant Thornton International:

Grant Thornton International is one of the world's leading organisations of independently owned and managed accounting and consulting firms providing assurance, tax and specialist advisory services to privately held businesses and public interest entities. Clients of member and correspondent firms can access the knowledge and experience of more than 2600 partners in over 100 countries and receive the same distinctive, high quality and personalised service wherever they choose to do business.