LATEST NEWS

MY BUSINESS IN ASIA

Accounting requirements in Malaysia

Legal requirements, accounting standards, penalties and sanctions:

Accounting and other records in Malaysia
Section 167 of the Companies Act 1965 requires every company and its directors and managers to keep such accounting and other records so as to explain the transactions and financial position of the company. The accounts must show a true and fair view of the company’s financial position to enable financial statements to be conveniently and properly audited.

All transactions must be recorded within 60 days of completion. These accounting and other records must be kept at the company’s registered office in Malaysia. The records are to be retained for seven years.

Financial Reporting Framework in Malaysia.
The Malaysian Accounting Standards Board (MASB) approved accounting standards comprise:
 

  • Malaysian Financial Reporting standards (MFRS) ;
  • Financial Reporting Standards (FRS) ;
  • Malaysian Private Entities Reporting standards (MPERS) 

MASB has issued the MFRS framework, which are equivalent to the International Accounting Standards Board for entities other than private entities, for the year commencing on or after 1st January 2012.

Only private entities can apply the PERS or MPERS standards. A private entity is defined as a private company, incorporated under the Companies Act 1965.

Private entities apply the MPERS for financial statements for the year commencing on or after 1 January 2016.

Financial statements and Audit Requirement
Directors of a company must present financial statements to the shareholders in a general meeting within 18 months of incorporation and, subsequently, at least once in every financial year at intervals of not more than 15 months. The financial statements must be prepared in accordance with approved accounting standards by MASB, and the provisions of the Companies Act 1965 and audited by an approved auditor. All amounts shall be presented in Ringgit Malaysia (“RM”).

An approved auditor must be a member of the Malaysian Institute of Accountants (MIA) under the Chartered Accountant category, for at least one year and hold an audit license issued by the Minister of Finance. The audit is conducted in accordance with the Malaysian approved audit standard which is based on the International Standards of Auditing (ISA).

First auditors are usually appointed by the directors of a company and thereafter by the shareholders at each annual general meeting (AGM) to hold office until the next AGM.

See also http://mybusiness-asia.com/en/structuring/accounting-for-my-business-in-asia​

​January 2016
Any further inquiries, please contact us.