Welcoming the blessed month of Ramadhan

By today, all Muslims around the world would be observing the annual fasting with the appearance of Ramadhan. For a month, they will refrain from eating or drinking and other acts which would nullify the fast. This is also the month where Muslims are reminded to distance themselves from bad behaviours such as lying and back biting and encouraged to do good deeds such as donating to the poor. The ultimate aims for all these act of submission to Allah are blessings, forgiveness and safety from the hellfire.

A part from fasting, Ramadhan has many other significant to Muslims. This was the month when the first verse of the Quran was revealed. This was also the month when the Battle of Badr was fought, when 300 odd believers persevered over their 1000 odd opponents. This battle is considered the turning point for Islam.

Ok, let's look as the reality around us. Even before Ramadhan appears, you may have heard people discussing about food and stuff that they wish to eat in breaking their fast. Restaurants and other eating outlets had been advertising about buffets, and Ramadhan bazaars will mushroom around cities, towns and villages. Unfortunately, Ramadhan has been turned into a month of eating and feasting.

Midway through Ramadhan, the Hari Raya Aidil Fitri songs will be played and the shopping centres would be the centre of attraction, instead of mosques and suraus. While Allah has promised bounties of blessings and forgiveness through Lailatul Qadar, which will come in one of the last 10 nights of Ramadhan, many Muslims are looking the other way, shopping and eating.

Aidil Fitri is the day when Muslims celebrate their return to the original state the day they were born. This is the ultimate aim of Ramadhan, for the Muslims to attain blessings, forgiveness and safety from hellfire. This will be based on their efforts in fasting and doing other deeds. How could this be achieved if they are distracted by food, shopping and music?

Since today is the first day of Ramadhan, it would be great for all Muslims to plan how they would achieve the objectives of Ramadhan. How can the quality of the ways Ramadhan are observed this year would be different and better compared to previous years.

Let's make this year a better year.

The Audit Oversight Board 2012 annual report

The Audit Oversight Board 2012 annual report could be downloaded here.

Many Shades of Truth

I heard about a Cambodian produced film winning at the Cannes Film Festival over BFM while I was driving this morning. What attracted my attention was when the winning director of the film The Missing Picture,  Rithy Panh, was quoted to have said that, 'Cinema is not truth. Even when you make documentary films, you can choose to show this shot and not the other shot _ this side and not the other side. In cinema there's one truth _ not 'the truth'. 

The Missing Picture is about Rithy Panh's personal articulation of the dark episode in Cambodia when the Khmer Rouge lead by Pol Pot came into power in 1975 and the atrocities it committed towards fellow Cambodians. Having visited some of the scary sites in Phnom Penh myself, I wonder how human could fell so low that taking life and causing pain were considered the right thing to do. This had happened in many other part of the world and are ongoing, whether sanctioned by the state or otherwise. You can read an interview with Rithy Panh by the Bangkok Post here.

While history is supposed to be the narration of facts that occurred in the past, how history is told could be subjected to manipulation. As Churchill used to say, "History is written by the victors". Why is this so? Put it simply, those who are in the position to control information and the shape of information that goes out to the mass would be able to frame facts or even fiction in ways which purportedly reflecting truths. Even present events are susceptible to such manipulation. Hence, what is truth or otherwise would be based on the honesty of people who have the ability to shape other's views.

Of course, we may also wonder why people who could be so low in their morality are given the ability to decide what others should or shouldn't believe in the first place? Well, in certain cases in the past, they came into power by force. However, in many other situations, they simply reflect the values of the society itself. When people do not care to do the right thing but are more concern about fulfilling the selfishness, don't blame others when people with low morality are in the positions to influence our lives. 

Has the evolution of social media re-shaped such situation? Well, some may argue that when a group of people are no longer able to dominate "truth", then  the ground has to a certain extend changed. Platforms such as Facebook and Twitter could spread information very fast. While this could be welcomed, our ability to handle such vast information, which may not necessarily true as well, could also shape the truth in our minds. Maybe we need new skills in distilling information from many sources to enable us to figure out the real messages behind them.

So, be careful in analysing information that is fed to us by many sources and medium. Do not simply swallow them as truth, even when conveyed by your closest friends. Think and reflect. At the end of the day, we will have to live with the "truth", whether we like it or not. An easy way to deny the truth is to claim that it is merely a perception!

The Flowers of Keukenhof

The Netherlands is synonymously associated with tulips. For the visitors who wish to see for themselves the blooming flowers during spring in the Netherlands, Keukenhof is the place to be. Unfortunately, this place is only open from March until June. This year alone, close to 850,000 people visited this wonderful place.

The Tulip were originally a wild flower growing in the Central Asia and were first cultivated by the Turks as early as 1,000 AD. The flower were introduced in the westen Europe and the Netherlands in the 17th century by Carolus Clusius, a famous biologist from Vienna. In the 1590’s he became the director of the Hortus Botanicus in Leiden, the oldest botanical garden of Europe, founded in 1587. He was hired by the University of Leiden to research medicinal plants and while doing so he got some bulbs from Turkey from his friend Ogier Ghiselain de Busbecq, the ambassador of Constantinople (presen-day Istanbul). He had seen the beautiful flower, called tulip after the Turkish word for turban, grow in the palace gardens and sent a few to Clusius for his garden in Leiden. He planted them and this was the start of the amazing bulb fields we can see today. More.

The system works

When you are travelling the last thing that you want is to waste time waiting for your transport. In many cities around the world, public transportation system such as trains, buses and taxis are critical elements of integrated networks which serve their population. Reliability, safety and affordability would determine the quality of public transportation system.

Singapore, consistent with its image as an efficient city state, offers an integrated network of public transportation system which enables millions of people to find their ways around the city effectively. While the Metropolitant Transport System or MRT is comparable with many other cities, I find the taxi services to be very good. Just hail the taxi, hop into them, tell the where you want to go and you'll be charge a fare based on the meter. Sound very basic but you may not get such predictability in Kuala Lumpur.

The Marina Bay Sands in one of the tourist attractions which attracts thousands of visitors every day. Just imagine you are there on a Saturday evening after a laser and bubble show. Many will be queuing for taxis and, yes, the queue could be really long. This is when the magic happens. The queue moves slowly but surely, nobody tries to jump queue, there will be enough taxis for everybody and no haggling is necessary. Try that in Kuala Lumpur and your blood pressure may shoot up.

I always consider the quality of the taxi service as an indicator of the quality of the city. It reflects the values of the people, their maintenance culture, commitment towards a service culture and how the society values others who may not be familiar with the place. So, whatever we feel about if taxi service in Kuala Lumpur, it may be a reflection of ourselves.

We may want to argue that Singapore is a fine city, where people will be fined for any breach of laws or rules, but the system works.

P/S The school holidays start next week in Singapore and parents will bring their children abroad. To get the economy going, The Great Singapore Sales will kick in to bring Malaysian and Indonesian bargain hunters to the island ~ as told by one of the taxi drivers.

Malay heritage in Singapore

When I was small I kept on hearing about Arab Street whenever my relatives were discussing about Singapore. Now I realised they were referring to many textile outlets located in the area. They were talking about shopping.

However, Arab Street is located within the Kampung Gelam, a heritage area associated with the Malays and their culture. This may not be exactly true as Malays and Islam, like in Malaysia, are used interchangeably. 

In fact I would say the influence of Muslims originating from the Middle East are stronger. Well, that is not the topic of this posting but this is an issue which could create perceptions and mis-perceptions in many other places when a particular group of people is blanketly associated with a particular believe or practice.

The Sultan Mosque is also located in Kampung Gelam, adjacent to the Kampung Gelam Malay Heritage Complex. Within that area, we could find many Halal eating outlets with variety of foods from many parts of the Islamic world. 

One of the famous outlets here is Zam Zam Restaurant where you could have among the best murtabak in the world in addition to the Beryani that it serves. One can have a choice of lamb, beef or deer murtabak. Many Malaysians bring back the murtabaks.

Coming back to the textile outlets, this is also a great place for shopping, especially for those who want to prepare early for Hari Raya! Oppss, my wife is with me and she could think the same as well.

I want to be a teacher

Honestly, that is what I believe what I really want to do right now.

My father was a teacher and so was his father. He started teaching in Machang, a district in Kelantan, in the 60's. I could not remember which year but I was born there in 1965. My mother was a dental staff nurse and we lived in the quarters allocated to her.

I believe my father served at Sekolah Rendah Hamzah, Machang, for more than twenty years before he was transferred back to Kota Bharu in the 80's. He last post there was the headmaster. In those days, being a headmaster is more than just that. To a certain extent, that position is looked up with respect by the society. When people ran out of cash, they will appear in front of the house with their land titles and hope my father could figure out some ways to address their problems. This was the reason why many teachers ended up in politics. When the fruit season came, there would be plenty of fruits for us to enjoy as people who appreciated what my father did would be very generous in bringing the fruits that they planted to our home.

In the early days in Malaysia, many smart people did not have the opportunity to explore many opportunities as we have nowadays. I am not sure whether my father went into teaching out of love for the profession but he was offered to further his studies in England. However, given that his brother went to England and ended up marrying Auntie Jackie, my grandparents were not that keen for my father to follow the foot steps of my uncle. So, my father ended up in Penang Teachers College and I suspect there was where he met my mother who went for her training in Penang as well.

I can't recall that much how my father performed as a head master but I could just mention his name, Cikgu Nik Soh, many people from Machang, especially the more senior ones, would share many nice stories about him, which makes me feel very proud. He was known to be a very strict teacher and there are many stroies of how he used the cane on his students. Surprisingly, many of them including their parents ended up thanking him, not going to the police or instituting legal actions as what many of us may do nowadays.

This aspect is very important. As teachers nurture our future talents, we need the best and the brightest to be in that role. I am quite concern when observing that it may not necessarily be the case nowadays. The last thing that we want is when people go into teaching when their qualification and performance would not allow then to do other jobs. If this is happening, we will have a situation where our budding talents are brought up by people who may not experience success and high performance. 

This is not an issue at schools only but at universities as well. If university lecturers could not understand or appreciate what is happening in the industry, they could be teaching our future graduates their personal world views, which may not coincide with the realities out there.

The closest for me to teaching is by being an adjunct professor at the Business and Accountancy School, University of Malaya. I love to share my experience with students and their lecturers. However, because universities are demanding lecturers to do more research, in areas where sometimes I myself may not appreciate, I am not able to spend time with them in as mush as what I was hoping for. 

Hopefully, I will be able to continue with the family tradition of being teachers. In my own ways, perhaps.

Happy Teachers Day to all my teachers whom I may not able to name each and every of them. I really appreciate the knowledge, wisdom and values imparted by them and I pray that Allah will place them in the best of positions.

Accountancy action plan will detail demand and supply, and how the profession should be regulated

By ERROL OH
errol@thestar.com.my

PETALING JAYA: Malaysia's accountancy sector is expected to get a much-needed action plan by the year-end. The document will contain recommendations that mainly address the demand and supply of accountants in the country for the next several years, and how the profession should be regulated.

Led by the Securities Commission (SC), the multi-agency committee working on the project had recently agreed on the initiatives to pursue and the relevant timelines. The committee will next gather input from the many stakeholders in the public and private sectors.

The Committee to Strengthen the Accountancy Profession is chaired by SC executive director Nik Mohamed Hasyudeen Yusoff, who is also executive chairman of the Audit Oversight Board and a former president of the Malaysian Institute of Accountants (MIA).

The other members represent the Finance Ministry, Bank Negara, the Companies Commission of Malaysia, the Accountant General's Department and MIA.

Nik Hasyudeen told StarBiz that one of the committee's primary tasks was to assess the country's demand for accountants, particularly in light of the various developmental plans that had been launched in the past couple of years, such as the Capital Market Masterplan 2, the Financial Sector Blueprint 2011-2020 and the SME Masterplan (2012-2020).

In addition, the projects under the Economic Transformation Programme (ETP) are expected to boost the need for accounting services.

“There's a need to look at the demand for accountants as we head towards 2020, and the competencies required to sustain the development,” he added, pointing out that it was not just about the numbers.

“We must recognise that the skill-set and competencies demanded of accountants may change as the country progresses.” Nik Hasyudeen said.

After working out the projected demand, the committee would then focus on the supply of accountants, including reviewing the training and qualification framework in Malaysia.

On the regulatory aspects that the committee would examine, Nik Hasyudeen said the aim was to identify regulatory impediments that might affect the efforts to boost the profession in Malaysia.

“We expect to complete our work by the end of the year and we will come up with recommendations to the Government on what needs to be done,” he added.

The committee was set up in response to the World Bank's assessment of the accounting and auditing environment in Malaysia. According to Nik Hasyudeen, after the World Bank issued the report in February 2012, the SC proposed to the Finance Ministry that a committee be formed to follow up on the findings.

Among other things, the report said there should be an independent review of the MIA's governance structure so as to find ways to improve its structure and operations. The report also recommended a review of the local university accounting degree programmes.

The World Bank said the recommendations in the report offered “the groundwork for the preparation and implementation of a country action plan geared toward the further strengthening of the regulatory framework in what is already a strong and cohesive financial reporting and auditing system in Malaysia”.

In a media briefing on March 14, in conjunction with the release of the SC's Annual Report 2012, chairman Datuk Ranjit Ajit Singh said that an implementation committee had been established “to formulate a country action plan on accounting and auditing”.

The regulator's website has a page providing information on the committee.

It says: “The Committee to Strengthen the Accountancy Profession has been set up to formulate and recommend strategies and measures to strengthen the accountancy profession and improve the contribution of the profession in enhancing the competitiveness of the country in line with the Government's transformation agenda.”

Of late, there has been concern within the accounting fraternity and among policymakers that Malaysia is not moving fast enough to expand the economic contribution of the accountancy sector, although the ETP roadmap talked about opportunities for Malaysia to export accountancy services.

In December 2008, the Singapore government set up the Committee to Develop the Singapore Accountancy Sector, which in April 2010 came up with an 82-page final report on how to transform Singapore into a leading global accountancy hub for the Asia-Pacific region by 2020.

Sorry, I can't remove the advertisements

I am sure the visitors will notice the kind of advertisements which have been appearing at this blog in the recent weeks. During this period of time, people in Malaysia are being persuaded to decide in one way or another. Given the time and age, such persuasion could appear in the form of web advertisements  at websites which are linked to search engines such as Google. This blog included. 

While such arrangements helps the websites to be visible, the website owners are not in control of the kind of advertisements which will be appearing. Just imagine advertisements regarding alcoholic drinks appearing on Islamic related websites!

While such confusion exists, it demonstrates the state of play where information on its own does not create value. It has to be contextualised. Given many of us are still anchored at the days and times where the powerful will bombard the powerless with all sort of information, rubbish or otherwise, as a symbol of power and control, such practice is not unexpected.

However, the audience has many more options nowadays. Many of us consider news on the internet as their main stream media. The effectiveness of the old "main stream media" such as radio, television and printed newspaper has to a certain extent diminished, especially where people have easy access to the web and has a bit of intellectual capacity. Notwithstanding this, the old media serves as a platform to make the powerful feel good as observable domination is certainly comforting.

This posting is meant to extend my apologies to those of you who are not interested with the kind of advertisements which appear here. I am not in control of them but I trust you are here because of the content. If you don't like the advertisements, just do the opposite when it matters!

MIA’s response to ‘Who audits the auditors?’

AS THE statutory body responsible for the regulation of the country’s accountancy and auditing profession, the Malaysian Institute of Accountants (MIA) would like to express deep concern over Datuk Shireen Muhiudeen’s article titled, “Who audits the auditors?”(StarBizWeek, April 20, 2013).

The article has questions and commentaries that we feel need to be clarified in the public interest.

In it, Shireen highlights, among others, that auditors of a company have committed errors in the disclosures in a company’s audited financial statements. We have written to the writer to seek information on the company and their auditors to enable us to investigate this matter.

The MIA has always cooperated with other relevant regulatory bodies such as the Audit Oversight Board, Bursa Malaysia, the Securities Commission, Bank Negara and the Companies Commission of Malaysia to ensure that the integrity and professionalism of the accountancy profession is upheld.

In any circumstances where the public has knowledge of any form of misconduct or misdemeanour of any member of the accountancy profession – in this case, it would be the auditors of this company – it is highly advisable and prudent for the public to come forward and lodge a complaint with the MIA, to enable appropriate action to safeguard public interest.

The points raised in the article also seem to blur the distinction between the roles and responsibilities of the preparers of financial statements and those of the auditors.

The Companies Act 1965 clearly provides that the directors are responsible for the preparation and fair presentation of the financial statements, while the duty of the auditors is to form opinions on the financial statements.

The financial statements are performed by the company’s finance function, which should be staffed by professionally qualified accountants well-versed in current accounting standards and the operations of the company. In our view, they should not be merely “book-keepers” and should play an important role in the company’s governance.

The auditors’ responsibility is to express an opinion on the financial statements. They conduct an audit on the financial statements to obtain reasonable assurance as to whether the financial statements as a whole are free from material misstatement.

Accordingly, they express an opinion on whether the financial statements are prepared, in all material respects, in accordance with the applicable financial reporting framework.

It is also important to note that the auditors are not supposed to be involved in the preparation of financial statements, which would otherwise affect their independence (as provided for in MIA’s by-laws).

We wish to emphasise that the integrity of financial statements and the efficacy of financial reporting are dependent on effective board of directors, senior management, internal auditors and external auditors who are fully cognisant of their respective roles and responsibilities within Malaysia’s legislative and corporate governance framework.

The MIA, as the regulator of the accountancy profession, will do our part in ensuring that the integrity of the financial reporting will not be compromised.

Datuk Mohd Nasir Ahmad

President

Malaysian Institute of Accountants

Competitor moves further ahead

If one visits the Asiatique night market in Bangkok, one could observe that Thailand is strengthening its position as a tourist destination a notch higher. This place stretches the concept of night market a notch higher.

The overall concept, layout, products sold and people at this huge tourist spot is not easily duplicated elsewhere. The strong Thai small and medium enterprise community is one of its pillars of the strength of its economy. You can't set up a huge market like this unless you are a key supply chain player. The availability of competitively priced labour is another pillar.

The choice and quality of products here appear to be slightly different from those offered at places such as MKT. Is Thailand moving away from the cheap imitation goods image that many of us usually think of?

While I may not have made a correct analysis, Asiatique is certainly a place where I will bring my family to and I am sure they will be enjoying themselves.

Off course, the famous Bangkok traffic jam seems to be the problem that they need to work on.

Malaysia sets up accounting training centre

By INTAN FARHANA ZAINUL
intanzainul@thestar.com.my

PETALING JAYA: Malaysia has kicked off the Institute of Chartered Accountants in England & Wales (ICAEW)Regional Centre of Accountancy Training Excellence that will offer students from the country as well as the region to be qualified as chartered accountants.

This would be the first accounting training excellence centre in the region.

It is a collaboration between ICAEW, TalentCorp Malaysia Bhd, Sunway-TES, Sunway Group and five accounting firms - BDO Malaysia, Deloitte, Ernst & Young, KPMG and PwC.

This is the first such public-private partnership in the region and supports the government's aim of establishing Malaysia as an education hub for Asean and provide the needed skilled talent to effect Malaysia'sEconomic Transformation Programme (ETP).

Speaking at the launch, TalentCorp chief executive officer Johan Mahmood Merican said the initiative was in line with the Talent Roadmap 2020 and it would be a critical step in building a world-class workforce.

“In order to achieve this, we would need to reach the talent available in the region and through this partnership, it would ensure us to tap upon an elite group of individuals who wants to work in Malaysia and contribute to our economic transformation,” he said.

“Under the ETP, we want to create a cycle of having more investments attracting and retaining more talents which would further drive more investments to our economy,” Johan said

Business services makes up one of the ETP's 12 National Key Economic Areas and the accountancy sector has been identified as a business opportunity.

Sunway-TES director Lee Weng Keng said the programme would enable students from all over the region to be qualified as chartered accountants, offer career opportunities and increase the skills and talent pool in the country.

“Talentcorp would be the facilitator to get the employment pass for the international students to be able to work here,”he told StarBiz.

He expected other accounting firms, banks and businesses to participate as the programme matures, perhaps by next year.

“This year we are targeting to have 30 international students to participate in the programme and additional 70 by next year,” he added.

Lee noted that BDO had already recruited five students from Vietnam (2), Indonesia (2) and China (1).

Malaysia Institute of Accountants chief executive officer Ho Foong Moitold StarBiz that Malaysia currently faced a shortage of accountants.

“The need for accountants is in tandem with the economy growth and there is also a great demand for accountants in the region.

“We think this is a good initiative and we believe this would help to build a pool of accountants both in Malaysia as well as in the region,” she added.

ICAEW chief executive Michael Izza told reporters that Malaysia was chosen to be the training hub in region for ICAEW because of Sunway's track record to produce the best accounting students with six World Prize winners for individual papers so far.

“Besides the good track record, we also like with the support by various parties such as the educational institutions, employers and the government,” he added.

Conversations with Global Thought Leaders

I met two global thought leaders in the recent weeks. The first was Lord Hastings of Scarisbrick, the KPMG Global Head of Corporate Citizenship. He was the speaker at the CPA Australia CEO luncheon and he spoke about whether corporate philanthropic is a reflection of good corporate behaviour. 

According to Lord Hastings, what is more important is the overall behaviour of a corporation in ensuring its conducts are in line with social expectations and do not compromise our environment. Hence, doing one or two corporate social responsibility activities is not a substitute for good corporate citizenship.

We sort of agreed that in ensuring good corporate behaviour, the people within the organisation matters and we should leverage on their beliefs to encourage them to do the right thing. This is somewhat neglected in Europe and America as religion is purposely ignored, especially in the corporate world.

I also had the opportunity to meet Michael Izza, the CEO of the Institute of Chartered Accountants in England and Wales. Michael was in town recently to launch the ICAEW Regional Centre of Accountancy Training Excellence.

In sharing the development of the capital market and where accountants can play their roles, Michael spoke about the important of ethics. When I asked about the role of values in instilling integrity, Michael responded that organisations such as ICAEW are becoming more concerned in sending messages that what is legally right is not necessarily acceptable. He cited the example of global companies which are paying very minimum taxes based on business structures which are perfectly legal.

I suppose moving forward, the issue of values and good citizenship would be more debated and considered based on our present understanding of how greed and selfishness drove the recent global financial crisis.

Given the importance of ensuring persons to be given responsibilities should be selected based on their merits, values and ethical conducts, we should not be blinded just because of impressive historical financial performance or promise offered. The crisis had certainly educated us that anything that is not built on a solid foundation will eventually crumble. The question is who is going to pick up the pieces and pay the bill. You and me or our children and their children?