KUALA LUMPUR: Malaysia’s audit framework has been acknowledged by the European Commission as being on par with international and best practices, with its rules pertaining to public oversight, quality assurance, investigation and penalty systems for auditors and audit, equivalent to theirs.
“With such recognition, Malaysian audit firms can provide audit services to companies from the European Union (EU) without additional regulation,” Audit Oversight Board (AOB) executive chairman Nik Hasyudeen Yusof said in a statement yesterday.
With the recognition, AOB and the EU auditor regulators may conclude cooperative agreements to rely on each other’s work on the supervision of auditors and audit firms.
The acknowledgement validated Malaysia’s ongoing efforts in warranting independent audit oversight over public interest entities, consequently attesting to the country’s regulatory framework for auditors as being on par with international standards and best practices.
According to the statement by the Securities Commission, an assessment had been conducted by the European Commission last year with the assistance of the European Group of Auditors’ Oversight Bodies.
The outcome of the assessment accredited Malaysia alongside nine other countries, namely, Abu Dhabi, Brazil, Dubai, Guernsey, Indonesia, Isle of Man, Jersey, Taiwan and Thailand as countries to have met and followed similar standards pertaining to public oversight, quality assurance, investigation and penalty systems for auditors and audit entities as set out in the European Commission audit framework.
AOB was set up in 2010 to oversee the auditors of public interest entities, protect investors’ interest and promote confidence in the quality and reliability of these entities’ audited financial statements. It was admitted as a member of the International Forum of Independent Audit Regulators in the same year, making Malaysia the second country from Asean to be admitted.