Is MIA a regulator or a country club?
This had been the perennial question even when I was involved in the leadership of the Malaysian Institute of Accountants (MIA).
There are two schools within MIA when it comes to this issue. One who feels MIA should be protecting public interests and exerts its powers on accountants across the board to ensure they maintain professionalism and create value for their employers, clients and other stakeholders.
The other group, mainly practitioners, wants MIA to be more like a country club where the interests of members should be paramount over others.
I don't have any problem for MIA to be a country club if it is just like any other professional bodies where people join them to be recognised and enjoy benefits they offer. MIA on the other hand is a body created by a statute where its membership is compulsory. Why? So that only competent individuals are recognised as accountants and they are regulated to serve public interests.
However, the unique feature of MIA as a regulator is that a third of the Council members are elected by the members at large instead of being appointed by the government unlike the Board of Engineers or the Malaysian Medical Council. This is akin to have the cab drivers electing who should be on the board of SPAD to regulate them! This feature creates confusion, even to some of the MIA Council members themselves.
Whenever there is election to elect Council members, there would be campaigns, although not as low as those in politics, by aspiring candidates. Guess what would be their core promises? Members interests!
This conflict of role was best demonstrated when the Companies Commission solicited views on audit exemption for small companies, MIA fought tooth and nail to retain mandatory audit across the board even when it knew that audit exemption is practically implemented in most countries in the world to make life simpler for budding businesses until they reach the stage where the risks they pose to the society is significant.
At the same time, MIA appears reluctant to be more assertive on auditors who keep on failing their practice review. Even the whole framework can be questioned. Why have practitioners making decisions on practice review outcomes when their conflict of interests in that subject is very clear? In the era of modern audit regulation, having practitioners on decision making structure of audit regulators is a big no, no.
As at 30 June 2016, 681 out of 1,487 audit audit firms registered with MIA had been reviewed. The results certainly are not giving confidence to the public. Only 7% of those firms obtained the Satisfactory level, 45% had "assurance of compliance" while 48% needed "follow up". Needed follow up means the work of these firms had not been up to the professional standards set by MIA. Just imagine close to 50% of the cars in showrooms may have major defects!
MIA also shared on its website that it did 29 follow-up reviews on firms which were reviewed earlier. Based on my understanding of the report, 16 firms or 55% of them still were not been able to achieve the quality of work expected out of audit firms.
MIA cannot avail itself from responsibilities regarding audit quality amongst audit firms which are registered with it. I am aware that for auditors to get their approvals renewed by the Minister of Finance, they need the support from MIA. I wonder whether those firms which failed their second review are still supported by MIA? Such support, if given, is a clear breach of public trust given to MIA. MIA also has an obligation to IFAC to ensure its audit supervision work is effective. That is a tall order.
The MIA Council must remember MIA is not a country club. They have the responsibilities to make MIA a respected regulator. Why should MIA’s membership be made compulsory if there are no serious efforts to weed out members who failed to uphold MIA’s own standards? The auditors only deserve their rice bowls if their behaviours are consistent with public interests.
I feel MIA's structure has to be clarified once and for all. As a regulator, MIA has to be focused on ensuring accountants perform their duties as promised and uphold professional values as all time and all cost. If this is not the primary duty of MIA, then it should become a real country club so that those joining it is clear that the main purpose of joining it to have fun.
*Nik Hasyudeen Yusoff is a former President of MIA
**The views expressed are of the author's and do not necessarily reflect the position of Astro AWANI
Nik Hasyudeen Yusoff
Fri Aug 18 2017
The author feels MIA's structure has to be clarified once and for all. - MIA's website
Pasaran Kerja | MOSTI sasar 5,000 peluang pekerjaan tahun hadapan
Kementerian Sains, Teknologi dan Inovasi (MOSTI) mampu mencipta sekurang-kurangnya 5,000 peluang pekerjaan tahun depan menerusi pelbagai program dan inisiatif yang bakal dijalankan.
Belanjawan 2022 | PH harap cadangan pembangkang dipertimbang kerajaan
Jawatankuasa Ekonomi Pakatan Harapan (PH) berharap cadangan pembangkang kepada Menteri Kewangan berkenaan Bajet 2022 akan diberi pertimbangan penuh oleh kerajaan. Menurut PH dalam satu kenyataan, cadangan yang telah dibentangkan kepada Tengku Datuk Seri Zafrul Tengku Abdul Aziz pada 21 September lalu bersesuaian dengan kerangka kerja 'Pemulihan, Ketahanan dan Pembaharuan' Bajet 2022.
Vaksin COVID-19 | 43 peratus masyarakat Orang Asli lengkap vaksinasi
Seramai 74,096 daripada 144,180 masyarakat Orang Asli di seluruh negara telah lengkap divaksinasi setakat Jumaat.
RMK-12 | Fokus pemulihan ekonomi rakyat, negara - Muhyiddin
Pengerusi Majlis Pemulihan Negara (MPN), Tan Sri Muhyiddin Yassin menjelaskan Rancangan Malaysia Ke-12 (RMK-12) dan Bajet 2022 yang akan dibentangkan bakal memfokus ke arah pemulihan ekonomi rakyat terkesan COVID-19.
Syor tubuh Majlis Pemulihan Negeri - Muhyiddin
Langkah itu bagi memudahkan segala bentuk usaha pemulihan yang dilaksanakan kerajaan dapat diterima di peringkat akar umbi dengan lebih berkesan dan pantas.
Rakyat terjejas ekonomi bakal dapat manfaat dalam RMK-12, Bajet 2022 - Muhyiddin
Pengerusi Majlis Pemulihan Negara (MPN), Tan Sri Muhyiddin Yassin berkata, negara berdepan dengan situasi yang amat mencabar dalam tempoh empat tahun akan datang.
Rumah yang menjadi inspirasi filem 'The Conjuring' dijual pada harga AS$1.2 juta
Filem The Conjuring dihasilkan berdasarkan pengalaman keluarga Perron yang pernah mendiami rumah berkenaan pada tahun 1970-an.
Berbasikal: Amarjit menang besar Pilihan Raya UCI 2021
Amarjit berjaya mempertahankan jawatan Ahli Jawatankuasa Pengurusan UCI selepas memperoleh 38 undi daripada keseluruhan 43 delegasi.
Wanita warga Indonesia jadi buruh paksa diselamatkan
Majikan dipercayai mengeksploitasi mangsa dengan ugutan yang beliau bukan pekerja sah.
Belum ada individu dipanggil kes video, mesej lucah babit pendakwah
Polis masih menjalankan siasatan berhubung video dan mesej lucah yang tular di aplikasi Telegram dikaitkan dengan seorang pendakwah.