The review of financial statements is carried out by the Financial Statements Review Committee (FSRC), a committee established by the Council of the Institute under the Accountants Act 1967.
The primary objective of the FSRC is to monitor the quality of financial statements and reports that are prepared by or within the responsibility of members of the Institute, for the purpose of determining compliance with statutory and other requirements, approved accounting standards and approved auditing standards in Malaysia.
Common findings arising from the reviews are shared with members with a view to improve the quality of financial reporting.
The FSRC works closely with other regulators with an aim to promote high quality standards in financial reporting. The FSRC also looks into matters referred to it by other regulators and may review those financial statements where there are public interest issues.
In addition, the FSRC monitors the media as part of a proactive surveillance approach on potential accounting, irregularities and reporting deficiencies in public listed companies and public interest entities.
Where necessary, should a member be found to have breached any Institute’s By-Laws and/or other statutory requirements in the preparation of and reporting on the financial statements, appropriate action will be taken. The action to be taken depends on the types of penalty tariffs issued that are determined based on the findings of the reviewed financial statements.