KUALA LUMPUR: There is a dire need for greater ethical and professional conduct by auditors and those in top management if we are to achieve financial reporting excellence, according to MIA president Christine Foo.
She said Malaysians, especially directors and accounting professionals, should adopt a stronger corporate culture of ethical behaviour at all levels.
“But it’s really up to the individual to behave ethically in business and no amount of regulations imposed will come to anything,” Foo, who was also the moderator, said at the Audit Oversight Board (AOB) and Malaysian Institute of Accountants (MIA) session on Corporate Governance: Steering Capital Market Towards Financial Reporting Excellence yesterday.
MIA council member and Ernst & Young partner Stephen Oong, a guest speaker, said the attainment of financial reporting excellence was necessary.
However, he said, with the introduction of the new Financial Reporting Standards (FRS 139) to take account of the risk companies undertake in the course of doing business, it had made it tougher but not impossible to achieve financial reporting excellence.
“Auditors now have to take account many intangibles and factor them into the books to reflect the true financial position of the company, including the risks undertaken,” he said, adding that the job was further complicated by the use of too much accounting jargon.
IJM Land Bhd director Boey Tak Kong concurred with Oong that achieving financial reporting excellence was imperative for Malaysian companies as many fund managers, especially foreign ones, looked upon local companies that acted ethically, had good corporate governance and adhere to international accounting reporting stardards more favourably.
AOB executive chairman Nik Mohd Hasyudeen said auditors now had to adhere to more stringent standards of reporting in the interest of shareholders, in view of the recent slew of companies that went burst locally and abroad.
“With this in mind, the establishment of the AOB is timely to assist auditors in the course of discharging their duties as professionals,” he said.