Self testing kits
SELF-testing kits for the Covid-19 virus are becoming more popular globally. This is a step in the right direction as quicker, faster and cheaper testing should help stem the spread of the virus.
A few public-listed companies have jumped into the space. It is a business that is bound to grow quickly, as companies and individuals rush out to buy these kits. But supply is coming in fast and there are already indications that the kits that were difficult to obtain a month ago, are now becoming more available and at cheaper prices too.
So as more self test kits hit the market and their prices come down, so too will the profit margins of companies getting into the distribution business of such products.
What is also hoped for is that the Malaysian authorities would speed up the approval of self-testing kits by different producers, but of course those kits have to meet the required standards.
Business groups such as the SME Association of Malaysia have welcomed the availability of these tools in the market, which can enable the early detection of Covid-19 cases and good internal control for companies.
It’s been said that with more testing and isolation, Covid-19 can be defeated and it is likely that self-testing kits will play a big role in fighting the pandemic.
It already is in Europe where employees entering the office on a daily basis go through simple covid testing before they enter their workplace.
Over in Singapore, it was recently reported that all households will receive Covid-19 self-test kits, as the island state scales up its testing regimen and works to live with the coronavirus.
The Straits Times reported that as these kits are being distributed, the country will also be looking to roll out other ways of testing for the virus. These include breathalyser tests in Parliament before each sitting, in addition to similar tests at the country’s checkpoints.
Believing the numbers
THE history of companies on Bursa Malaysia is peppered with companies that have run afoul with accounting issues.
Often the end result is painful for shareholders. There is always the sell-first reaction and see what transpires next.
The worst-case scenario is a complete fraud that has led to companies vanishing from the bourse in time with great loss to shareholders. Directors get hauled to court and the entire episode is a terrible stain on the stock exchange.
Accounting issues have also blown up abroad and it will happen again in the future. It is nearly impossible to prevent but the solution is to ensure it is minimised as much as possible.
That came via a reminder on Thursday when the Securities Commission’s (SC) Audit Oversight Board (AOB) urged auditors to be more vigilant and diligent in the execution of their duties during the current period of economic uncertainties due to the Covid-19 pandemic.
The SC highlighted that during the prolonged uncertainties arising from the pandemic, it is even more important now for auditors to exercise appropriate professional scepticism in conducting their audits.
The SC chairman says that high quality audits promote integrity and ensure investor protection whilst contributing to better corporate governance in public interest entities.
The accuracy of any accounts is what stands between what a company is telling and what investors have to go by.
Accountants then play a stewardship role in ensuring that those accounts are accurate as there is no other way investors have to verify whether what a company is reporting is the truth or not.
In the statement, it notes that the AOB observed a significant increase in the percentage of audit engagements which required further evaluation and investigation, from 44% in 2019 to 88% in 2020.
There is going to be pressure during this pandemic where companies will remain under the pressure to report positive earnings. But is handling those expectations, the internal auditors have to know that any tweaking of the numbers, if caught out, will have far greater ramifications once the good times return.
Plus external auditors too will be well aware that their reputation too is under greater scrutiny that before.