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Showing posts with label Accountants. Show all posts
Showing posts with label Accountants. Show all posts

Tuesday, February 12, 2019

Integrity should be no compromise! Malu apa, bro! Queries over credentials, Wee presses on quizzing Lim

Weighing in: (Clockwise from top left) Ramon, Marina, Hassan, Anas and Marimuthu

‘There should be no compromise on integrity’

Honesty and integrity should take centre stage in the debate that is swirling over the legitimacy of certain university degrees of politicians.

Asli’s Centre for Public Policy Studies chairman Tan Sri Ramon Navaratnam said good political leaders need not be graduates but some academic credentials would be an asset to them.

“What we need are politicians with keen critical thinking, dedication and sincerity to serve the rakyat,” he said yesterday.

Ramon said that politicians who had “cheated” should confess and let the people decide if they still want them to carry on serving or quit their posts.

Several politicians have come under fire after their academic qualifications were questioned by the public.

Deputy Foreign Minister Datuk Marzuki Yahya found himself in hot water following the controversy over his “Cambridge University” degree.

Others included Finance Minister Lim Guan Eng, Defence Minister Mohamad Sabu, Housing and Local Government Minister Zuraida Kamaruddin, Johor Mentri Besar Datuk Osman Sapian and Perak state executive councillor Paul Yong Choo Kiong.

Several Barisan Nasional leaders too had their qualifications scrutinised in the past. Among them were former prime minister Datuk Seri Najib Tun Razak and Human Resources Minister Datuk Seri Richard Riot.


Former UiTM vice-chancellor Emeritus Prof Datuk Dr Hassan Said said in other countries, leaders would have been asked to resign or they would voluntarily quit if they were found using dubious credentials.

“Honesty and integrity values are more important to those who are dealing with public trust and responsibility.

“The nation will collapse if its leaders are not honest or have integrity,” he said.

Educationist Prof Tan Sri Dr T. Marimuthu said politicians must come clean about their academic credentials as they are serving the public.

“Otherwise, how else can you serve the people?

“If you ask someone to write your thesis for you or use dubious ways to earn your credentials, you are just being dishonest to yourself and the public,” he said.

Moderation advocate Anas Zubedy concurred, saying that there should be no compromise when it comes to leadership and integrity.

“No matter how brilliant, knowledgeable or successful you are, a lack of integrity disqualifies any and all talent for any leadership position. We must check their track record for any propensity to lie, practise double standards, or to say one thing and do the other.

“New Malaysia must not compromise on integrity,” he said.

Writer and social activist Datin Paduka Marina Mahathir said it was better to own up in not possessing a degree than to pretend to have one.

“No, it’s not a crime nor is it essential to serve in the government but it’s a matter of trust. If you can misrepresent this, what else can you misrepresent?” she asked.

G25 group of eminent Malays said it is best to be honest about one’s academic credentials so that doubts are not raised on their integrity.

“A politician who lies about his personal details to win an election or get a ministerial position will raise doubts about his integrity. He will also create a bad image for the government and the country,” it said in a statement.

Najib asked whether it was the national news agency Bernama or officers of the ministers that had misrepresented the academic credentials of Pakatan Harapan ministers.

“But what is more strange is that the false news that the ministers were graduates came from the biodata published from Bernama in its infographics and was spread when they were appointed as ministers about nine months ago.

“As far as I know, normally Bernama would request the biodata from the special aides or the press secretaries of ministers when they are appointed to be published in its reports,” he said on Facebook.

Reports by Star team: TARRANCE TAN, HEMANANTHANI SIVANANDAM, RAHIMY RAHIM, NURBAITI HAMDAN, RASHVINJEET S.BEDI and SARBAN SINGH


Malu apa, bro!

WE seem to be heading towards a dangerous edge. There is now an emerging culture of shamelessness.

Datuk Seri Najib Tun Razak may have been slapped with countless charges of corruption and money laundering, but his campaign, Malu apa, bossku (“Why the shame, boss?” in Bahasa Malaysia), has surprisingly attracted millions of likes on social media.

The scandal-smeared former prime minister has traded in his tailored suits, impeccable English and political elite-aristocratic crowd for the Mat Rempit and Malay working class.

As part of his makeover, he is now decked in black parka, black jeans and black sneakers.

He is even hanging out with the young Mat Rempit and posting wefies with them. He is also happily showing off a black-and-red Yamaha Y15ZR 150cc moped that is all the rage with the youths of today.

And the registration plate on his bike is 8055KU, which insinuates “BOSSKU”, and to these newfound supporters, Najib is called Boss kita! (Our Boss.)

The key phrase here is Malu apa bossku, and while many learned Malaysians are cringing over this new culture, it barely seems wrong for our embattled former PM, who is basking in it and promoting the malaise.

But a similar show is also surfacing on the other side of the political divide.

One Pakatan Harapan leader after another is having his or her dubious education credentials exposed after Deputy Foreign Minister Marzuki Yahya was questioned over his.

Johor Mentri Besar Osman Sapian’s education history has come under the spotlight with the allegation that he didn’t obtain a degree from Universiti Putra Malaysia (UPM), as claimed.

Housing and Local Government Minister Zuraida Kamaruddin’s social science degree from the National University of Singapore (NUS), as reported when she became a minister, has also come into question. Now, she’s washed her hands of ever having had one.

DAP Assemblyman from Tronoh Paul Yong Choo Kiong claimed to have a masters in business administration from Akamai University – an alleged degree mill in Hawaii – among his academic qualifications.

None of these politicians have apologised for not correcting these errors when they were revealed, but now, they have conveniently shrugged off the news reports, claiming no knowledge of such revelations.

Worse, Marzuki passed the buck to Prime Minister Tun Dr Mahathir Mohamad, saying it is now up to his boss to decide. The Johor MB chose to remain silent, hoping that the storm would blow over.

The central issue here isn’t whether an elected representative should have a tertiary education – the point here is, should we put our trust in anyone who lies to themselves?

If some of these individuals buy dubious online diplomas, they are only cheating themselves. Worse, the electorate has also fallen for this charade hook, line and sinker.

Instead of working hard, like most university students, these individuals apparently chose the easy way out. Are we expected to believe them when they talk about accountability and integrity from now on?

What’s worse is, most Pakatan leaders have chosen to look the other way or have lamely justified these dishonest transgressions.

If they were in the private sector, the sack would be a foregone conclusion, but then they are “Yang Berhormat”, despite these dishonourable acts.

Apa nak malu, YB! Aku ada SPM aje, bro!

And of course, that’s not the end. PAS leaders have found themselves in unfamiliar waters.

With their turbans and goatees, they like to appear pious and holier than thou. However, they are now seeing their names flying on social media, associated with a taste for sports cars and bikes, and not just under their names, but those of their children and spouses.

A report filed with the Malaysian Anti-Corruption Commission (MACC) over allegations of PAS leaders getting RM90mil from Umno under the previous administration involved “a list of expensive cars”, properties, high-powered motorcycles and “the purchase of number plates at exorbitant prices”, it has been widely reported.

According to the report, several PAS leaders were accused of using these funds to acquire the cars and properties.

The cars include BMW, Mini Cooper, Toyota Vellfire, Range Rover, Porsche Cayman, Audi Q7, Audi A6, Toyota Camry, Toyota Fortuner, Volkswagen Passat, Mercedes Benz, and a BMW motorcycle, according to a report.

“As for the properties, this includes a bungalow in Bangi worth RM3mil,” says a report. The only item missing is camel ownership.

PAS Mursyidul Am (spiritual leader) Datuk Hashim Jasin has admitted to owning a Porsche Cayman, but said his son was the real owner, who was entitled to an Approved Permit (AP) when he served as the Arau MP between 1998 and 1999.

Every one of them has branded these accusations as part of some grand political conspiracy, pleading innocence and insisting they are virginal and pure instead.

But we are sure they will be okay, and they will continue to preach accountability and transparency, and possibly continue to look – invoking race, religion and God – to their faithful followers, who will readily give away their savings and, brave the rain and scorching sun to support them.

Malu Apa Bossku? Tatap Sokong Boss (as the Sabahans will say).


by Wong Chun Wai



Queries over credentials

DEPUTY FOREIGN MINISTER DATUK MARZUKI YAHYA

It was reported by Bernama that Marzuki pursued a Bachelor’s degree in business administration, majoring in logistics via a long-distance learning programme at the University of Cambridge.

Response: “When I was asked by the media, I clearly said that I was from Cambridge International University (CIU) in US and not the University of Cambridge in UK.”

FINANCE MINISTER LIM GUAN ENG

MCA president Datuk Seri Dr Wee Ka Siong questioned Lim's credential as a qualified professional accountant

Response: Lim's political secretary Tony Pua rebutted the allegations by producing Lim’s degree certificate from Monash University, Australia on April 11, 1984, together with a copy of his “Certificate of Membership” in the Australian Society of Accountants dated Feb 21, 1984.

DEFENCE MINISTER MOHAMAD SABU

Accused of faking a degree in culinary arts.

Response: “Some people say I have a degree in culinary arts. I never said that. Truth is, I never completed my studies at UiTM. They kicked me out.”

But Mohamad was quick to add that despite this, he was still a “good cook”.

HOUSING AND LOCAL GOVERNMENT MINISTER ZURAIDA KAMARUDDIN

A Twitter user claimed he could not find her name on the National University of Singapore’s online degree verification portal.

Response: “I have never claimed or held myself to be a graduate of NUS and I have never authorised anyone else to do so,” she said.

JOHOR MENTRI BESAR DATUK OSMAN SAPIAN

A Facebook page questioned the validity of his UPM Bachelor in Accounting obtained in 1985.
Response: He has yet to comment on the matter.

TRONOH ASSEMBLYMAN PAUL YONG CHOO KIONG


Yong was questioned over his Masters in Business Administration (MBA) from Akamai University, United States by MCA’s Dr Wee.

Response: Yong said he felt calm and had nothing much to comment as his certificate is real and he had a convocation 16 years ago.

“My main interest now is to do the best for my voters,” said Yong.

FORMER PRIME MINISTER DATUK SERI NAJIB TUN RAZAK

DAP highlighted a video circulating online alleging that Najib never completed his studies at UK’s Nottingham University in the 70s.

Response: “Of course my degree is legitimate.”


FORMER HUMAN RESOURCES MINISTER DATUK SERI RICHARD RIOT

Riot was questioned in 2013 over his Bachelor of Business Administration from the Chartered Insitute of Business Administration (Ireland) and a Masters in Business Administration from Preston University in the United States.

Response: “As (former) prime minister, he (Datuk Seri Najib Tun Razak) has used his wisdom to find out whether I am fit to be a minister, and that includes my academic qualification, by tasking me to be in charge of the human resources portfolio, which is a very a challenging ministry with 13 agencies.

“There is a difference between fake degree and qualifications from unrecognised universities. I worked very hard for it because I believe in life-long learning”, he said.


Wee presses on quizzing Lim

Wee: No evidence showing that Lim ever worked in any accounting firms.
Wee: No evidence showing that Lim ever worked in any accounting firms.
KUALA LUMPUR: Despite threats of being sued, MCA president Datuk Seri Dr Wee Ka Siong continues to raise questions on Finance Minister Lim Guan Eng’s credentials as an accountant.

Dr Wee said that “Lim is far from even being a certified or a chartered accountant”.

The Ayer Hitam MP, while referring to documents released by Lim’s political secretary Tony Pua yesterday, pointed out that Lim’s membership into the Australian Society of Accountants on Feb 21, 1984, merely stated that he was admitted as a provisional member.

A provisional membership, Dr Wee said, was one of the steps required to enrol into programme modules and examination in order to qualify as an accountant, and to qualify for a full membership into the Australian Society of Accoun­tants.

Therefore, a provisional membership is far from being a fully certified chartered accountant or even an accountant.

“You cannot call yourself using either designation,” said Dr Wee in a Facebook posting yesterday.

The Australian Society of Accoun­tants is now known as CPA Australia (Certified Practicing Accountant).

Checks online showed that a full membership is only awarded to individuals if they have successfully passed the CPA examination – which also requires a bachelor’s degree in accounting and a year of supervised working experience under a CPA licence holder.

At the same time, Dr Wee, in the same Facebook posting, pointed out that Lim was quoted by news portal MalaysiaKini in a report on March 2012 as saying that he was a failed accountant and had spent less than a week in an accounting firm in Malaysia before he was sacked.

Dr Wee said there was no evidence showing that Lim ever worked in any accounting firms, or having enrolled for any necessary education requirements to qualify as a certified accountant or a chartered accountant.

“In fact, online checks with the Malaysian Institute of Accoun­tants (MIA) does not show Lim as being a member.

“In Malaysia, you cannot misrepresent yourself as an accountant unless you are a member of MIA.

“It is a criminal offence under Section 25(e) of the Accountants Act 1967 for any individual or organisation to call himself or herself an accountant unless he or she is registered with the MIA,” said Dr Wee.

At the same time, Dr Wee said that a report by New Straits Times in June 2018 also pointed out that Lim had claimed to be a former accountant.

Meanwhile, Dr Wee also said that DAP’s website had misrepresented Lim as a certified accountant.

“Neither MCA nor myself have any interest in pursuing this matter any further as the declining economy right now is a more important issue to address.

“We leave it to DAP and the rakyat to judge if a legal offence has been committed,” said Dr Wee.

Lim’s qualification in accounting is the latest to come under scrutiny after a series of alleged false education credentials involving Pakatan Harapan leaders, including Deputy Foreign Minister Datuk Marzuki Yahya, Johor Mentri Besar Datuk Osman Sapian and Tronoh assemblyman Paul Yong Choo Kiong. - The Star.

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https://youtu.be/s6nOmgkJXx4

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Monday, February 11, 2019

Malaysia Finance Minister Lim Guan Eng's credentials as an accountant questioned

On Malaysia Finance Minister Lim Guan Eng's website, it is stated in his biodata that he graduated from Monash University, Australia, with a Bachelor of Economics degree and was a qualified professional accountant by 1983.PHOTO: ST FILE
 
PETALING JAYA (THE STAR/ASIA NEWS NETWORK) - Malaysian Finance Minister Lim Guan Eng's qualification in accounting is the latest to come under scrutiny following a series of alleged false education credentials involving Pakatan Harapan leaders.

Malaysian Chinese Association (MCA) president Wee Ka Siong, in questioning Mr Lim's credentials as an accountant, said according to Monash University's website, Mr Lim obtained his Bachelor of Economics in 1984.

(MCA) president Wee Ka Siong
"I have no doubt over his degree qualification. However, I wonder how he became a qualified professional accountant in 1983 before he even graduated (in economics)?" he asked in a Facebook posting on Sunday (Feb 10).

On Mr Lim's website: https://limguaneng.com/ , https://limguaneng.com/index.php/biodata/ , it is stated in his biodata that he graduated from Monash University, Australia, with a Bachelor of Economics degree and was a qualified professional accountant by 1983.

Datuk Seri Wee, who is the Ayer Hitam MP, also wanted to know how Mr Lim's qualification as a "qualified professional accountant" was accredited.

"Was it by a local or foreign institution? Which country accepts an economics graduate to pass as a 'qualified professional accountant'?

For a minister who always stresses on the concept of Competency, Accountability and Transparency, please explain and don't keep quiet," he added.

Dr Wee also described as "suspicious" Johor Mentri Besar Osman Sapian avoiding questions from the media on his supposed UPM Bachelor in Accounting obtained in 1985.

"UPM's official website stated that the course was introduced in 1985. How is it possible that there could be such a super-fast graduate produced in the same year!

"If Osman fails to prove the genuineness of his academic credentials, will he still have the dignity to lead the state? This is a question of integrity among leaders," he said.

Citing examples of several world leaders who resigned or were sacked for having fake academic credentials, Dr Wee questioned if the Pakatan Harapan leadership would remain quiet and behave as if nothing happened.

"Or will they respond with the standard Pakatan answer, that a person's academic qualifications have nothing to do with political position," he added.

In Teluk Intan, Bernama reports Perak DAP chairman Nga Kor Ming as backing Tronoh assemblyman Paul Yong Choo Kiong who comes under public scrutiny for his dubious Masters in Business Administration (MBA) from Akamai University, United States, claiming that he had obtained it "legitimately".

This is despite the fact that DAP adviser Lim Kit Siang had labelled the university as a degree mill in 2005.

Mr Yong, 48, was also questioned by Dr Wee as to how he could do his MBA without having a first degree.

The Perak executive councillor has in his biodata listed his primary and secondary school education followed by his MBA.

Responding to the controversy, Mr Yong claimed that his way to enhance his self worth has been blown out of proportion.

He, however, did not reveal how he obtained his MBA.

"What is the relationship between this and politics?" asked Mr Yong.

Sources: https://www.straitstimes.com/asia/se-asia/malaysia-finance-minister-lim-guan-engs-credentials-as-an-accountant-questioned and
https://www.thestar.com.my/news/nation/2019/02/11/lims-credentials-as-an-accountant-questioned/

 
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Tuesday, September 18, 2018

Revolutionising accounting for a new era

The field of accounting is in need of a new breed of professionals who can contribute more than a quantifiable value to companies.

Increasingly, accountants in business are given the opportunity to be less involved in automated operations and focus more on bigpicture strategies, which gives a clear indication of the type of skills required in the near future. Bryan Chung, FCPA



WHEN talking about the Industrial Revolution, images that often come to mind include the extensive use of steam power, the birth of heavy machinery and ironworks, and bleak factories in England.

However, two more industrial revolutions have since passed and the 21st century is paving its way for the Fourth Industrial Revolution (IR 4.0), which is seeing the rise of autonomous decision making of cyber-physical systems and machine learning through cloud technology.

In simple words, IR 4.0 is the usage of artificial intelligence (AI) and the Internet to transform age-old processes and operating procedures across all industries.

With such change taking place, what does this mean for the accounting industry and where do accountants find their relevance in an era that looks to automate everything?

Calculating assets

In an interview with international education provider Kaplan, Malaysian Institute of Accountants’ (MIA) chief executive officer Dr Nurmazilah Datuk Mahzan said, “Among the current trends that are creating waves in the accountancy profession are big data and analytics.

“Companies of all sizes create massive structured, unstructured and semi-structured data every day. Organisations harnessing big data would be able to find new insights and discover unique patterns of their customer behaviour or even create new businesses that were previously not possible.”

Echoing her sentiments is Bryan Chung, Fellow of CPA Australia (FCPA), divisional councillor at CPA Australia (Malaysia), who believes that even though AI is good at matching patterns and automating processes – making technology useful to many functions in companies in the process – accountants still play a vital role.

He says, “While there is a lot of hype surrounding blockchain and AI in accountancy with more firms taking steps to increase or experiment with their use, it is unlikely that accountants (or auditors) will be out of a job anytime soon.

“It is likely that most of the administration process will be the first to be introduced to AI. Increasingly, accountants in business are given the opportunity to be less involved in automated operations and focus more on big-picture strategies, which gives a clear indication of the type of skills required in the near future.”

The challenge, however, is turning the current workforce in the accounting field into professionals who truly understand the implications of IR 4.0, not just in terms of their personal skills but also movements within the industry.

Discovering market potential

Gone are the days when sales numbers, website traffic and KPIs were sufficient information to measure monthly net profits.

In the same Kaplan interview, the organisation’s global professional accountancy head Tanya Worsley said, “Businesses today depend on their accountants beyond purely checking financial figures and balancing books.

“Financial professionals are expected to be able to provide their clients with actionable insights that can add value to the organisation’s overarching strategic goals.”

The changing role of accountants in the digital economy is what prompted MIA to launch the Digital Technology Blueprint in July this year, a document that outlines the five driving principles to help guide Malaysian accountants to respond appropriately to digital technology.

These principles are related to digital technology trends, the identification of capabilities, harnessing of digital technology, funding and governance.

Accountants who fail to stay updated with the latest trends and knowledge will cause their employers to lose out in the long run, while competing firms take advantage of the evolving cloud system.

For these reasons, upskilling and obtaining professional qualifications from MIA or accountancy bodies such as CPA Australia, Association of Chartered Certified Accountants, Institute of Chartered Accountants in England and Wales or Chartered Institute of Management Accountants should be considered a necessity instead of mere steps for higher management.

As most professional accountancy bodies require members to undergo regular training to maintain their memberships, these certified professionals are expected to be fully prepared for IR 4.0 and, by and large, artificial intelligence experts.

Chung adds, “IT knowledge is no longer an option. Lest we aim erroneously, it is not how extensive the IT knowledge is (as this is available in abundance and can be acquired easily), but the ability to understand the evolution of the profession and apply the knowledge appropriately.”

Explaining that accountants must use technology in their favour to elevate companies to new heights, he gives the example of successful tech businesses that used e-platforms to achieve massive scalability and visibility within a short time, despite having owners or founders who were not IT graduates.

“In the same way, accountants should be more strategic, make sense of the vast data available and deliver services based on the twin pillars of speed and quality,” he continues.

Eliminating liabilities

When combining this piece of information with the future route of total automation for jobs that are repetitive, rule-based and involve limited or well-defined physicality, the traditional job scope of accountants is coming to an end.

Employers are bemoaning the skill gaps currently present in the knowledge of digital technologies, forcing companies to spend resources retraining and reskilling their employees.

At the other end of the spectrum, constant news reports highlight the more pressing issue of employers having difficulty finding good graduates who can hit the ground running upon entering the workforce.

These situations highlight the dire need for a new breed of accountants who can provide more all-inclusive corporate reporting, which tells less about the numbers and more about the narrative of a company.

The Malaysian education system, for one, must move towards becoming an ecosystem for continuous upgrading of skills, working together with employers, be they officials from the Government, small business entrepreneurs or industry experts from professional organisations.

Colleges and universities need to continue reviewing their course offerings so that graduates have an accurate understanding of the evolving industry while being trained to adapt to new technologies and autonomous changes at the workplace.

However, it is not all doom and gloom. Chung points out, “There are now many initiatives being undertaken by various professional organisations and associations to provide education to accountants to increase awareness of the changes taking place.

“There are efforts now by professional bodies, corporates and academia to come together to address the disconnect between what’s being studied at universities and what’s relevant in the business world.”

Given how the financial technology space has demonstrated the willingness of companies to use innovative methods, Chung is optimistic about the future as the accounting profession can not only make positive inroads but ride on the back of this momentum to accelerate the learning and adoption of technologies as the nation moves into a new era of automation.

Credit: Bryan Chung, FCPA

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Thursday, August 23, 2018

Probe on ‘Big 2’ accounting firms: KPMG and Deloitte still on over 1MDB accounts


KPMG and Deloitte being investigated over 1MDB accounts


KUALA LUMPUR: The Malaysian Institute of Accountants (MIA) is investigating KPMG and Deloitte, the two accounting firms involved in signing off the accounts of the controversial 1Malaysia Development Bhd (1MDB).

The investigations are on whether the auditors in question who handled the accounts had breached the Accountants Act when signing off 1MDB’s accounts between 2009 and 2014.

The MIA has the power to regulate the accounting profession in Malaysia.

“There are complaints lodged against KPMG and Deloitte and we are investigating the auditors in question. The complaints are on the auditors and it is ongoing,” MIA’s chief executive officer Nurmazilah Mahzan told StarBiz in an interview.

Nurmazilah said it could not be determined at this stage when the investigations would be completed.

“The results of the investigations will be studied by a committee. The process is continuing but we have not got the final verdict yet. We cannot predict how long it will take at this point in time. If the auditors are found guilty or if there is a basis to these complaints then we have to wait for the judgement of the disciplinary committee,” she added.

MIA’s executive director for surveillance and enforcement Datuk Muhammad Redzuan Abdullah said the investigations were at the disciplinary committee level now and investigations had started since mid-2016.

The scandal-riddled 1MDB that had accumulated debts of RM42bil over the five years between 2009 and 2014, has had four auditors since its inception. They are Parker Randall, Ernst & Young, KPMG and Deloitte.

1MDB appointed Ernst & Young as its auditor when it was set up in mid-2009. However Ernst & Young resigned in 2010 without signing off the accounts of the fund that was set up by the previous government headed by Datuk Seri Najib Tun Razak.

KPMG stepped in to take over from Ernst & Young and signed off the accounts for the financial years ended March 31 in 2010, 2011 and 2012. The accounts were signed off without any qualification from the auditors.

Deloitte took over the auditing in December 2013 after 1MDB contended that KPMG could not “conclude” its 2013 accounts.

1MDB had also said in May 2015 that Deloitte had signed off 1MDB’s accounts for 2013 and 2014. When questions arose as to why KPMG could not conclude the accounts for 2013, 1MDB stated in 2015 that Deloitte had signed off the accounts without any qualification.

Nevertheless, resignations by Ernst & Young and KPMG as auditors then had raised questions over the fund. In the accounting world, a firm rarely leaves a job half-done, especially more so when it involves big and prominent clients such as 1MDB.

After KPMG left, 1MDB obtained an extension of six months to submit its accounts for end-March 2013.

It was reported then that KPMG had relinquished its role as auditor. Deloitte then came in and managed to close the books within the extended period of six months.

Earlier reports quoting sources said the primary reason why KPMG could not give an opinion on 1MDB’s accounts was because it was not able to make a fair assessment of the value of the assets backing the fund’s US$2.3bil investment placed with a Hong Kong-based asset management company.

Subsequently Deloitte managed to complete the books wherein the fair value of the investments was put at RM7.18bil based on the assessment done by a third party engaged by the fund administrator.

Recent reports said KPMG which had then signed off on three unqualified audit reports for 1MDB, had informed its board of directors that the audited financial statements did not reflect a true and fair view of the company.

It was also reported that Deloitte in 2016 also said its audit reports on 1MDB’s financial statements issued on March 28, 2014, and Nov 5, 2014, for the financial years ending 2013 and 2014 should no longer be relied upon.

Credit: Daniel Khoo The Staronline


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Saturday, January 16, 2016

School grades don't matter much?

Accounting firms PwC and EY start a trend in recruitment to help business and society
Big Four

WE all know that good grades in school won’t necessarily land you that first job. They do however go a long way towards convincing a potential employer that you’re likely to perform well if hired. That’s why you’re routinely asked to produce certificates and transcripts during the application process. How else can the employer get a quick reading on the discipline, intelligence, diligence and knowledge of a school-leaver or a fresh graduate?

But what if an employer decides that your grades shouldn’t matter as much? How will that change things?

For the answer to that, we ought to be watching the Big Four accounting firms in Britain.

Starting in June last year, PricewaterhouseCoopers (PwC) stopped using the UCAS tariff as an entry criterion for most of its undergraduate and graduate recruitment schemes. Developed by the Universities and Colleges Admissions Service, the tariff is the British system for allocating points to those seeking undergraduate placements.

The system applies to a long list of entry qualifications — for example, A levels, City & Guilds diplomas, and music examinations — and the points for each qualification are worked out based on the levels of achievement.

Before this, a person usually must have a minimum number of UCAS points before PwC would consider his job application, even if he’s a graduate. This is apparently a common practice in Britain. With the policy change, the accounting firm can now overlook mediocre A-level results if the candidate has gone on to soar in his degree programme.

PwC says the reduced emphasis on UCAS points is because it’s important to be a progressive and socially inclusive employer, and because it wants to reach the broadest range of talented students.

“There’s strong correlation that exists in Britain between social class and school academic performance. This data suggests that by placing too much emphasis on UCAS scores, employers could miss out on key talent from disadvantaged backgrounds, because they may perform less well at school. That’s why, from an academic perspective, we’re focusing on your degree,” it explains on its website.

And then in August, Ernst & Young (EY) announced that it would remove academic qualifications from the entry criteria for its 2016 graduate, undergraduate and school-leaver programmes. Instead of insisting on certain standards for UCAS points and degree classification, the firm relies on “a new and enhanced suite of online “strengths” assessments and numerical tests to assess the potential of applicants”.

In other words, EY recruits by evaluating the candidates’ strengths and promise, not just their past performance.

This decision came after talent management firm Capp had studied EY’s student selection process over 18 months. The analysis found that EY’s strengths-based approach in recruitment, introduced in 2008, is a robust and reliable indicator of a candidate’s potential to succeed in his role in EY.

“At EY, we are modernising the workplace, challenging traditional thinking and ways of doing things. Transforming our recruitment process will open up opportunities for talented individuals regardless of their background and provide greater access to the profession,” says Maggie Stilwell, the managing partner for talent.

“Academic qualifications will still be taken into account and indeed remain an important consideration when assessing candidates as a whole, but will no longer act as a barrier to getting a foot in the door.”

“Our own internal research of over 400 graduates found that screening students based on academic performance alone was too blunt an approach to recruitment. It found no evidence to conclude that previous success in higher education correlated with future success in subsequent professional qualifications undertaken.”

It’s interesting that Stillwell describes an overriding dependence on academic qualifications as a blunt approach. Stephen Isherwood, the chief executive of Britain’s Association of Graduate Recruiters, has a similar view. The PwC press release on the firm’s move to drop the UCAS points entry criteria, quotes Isherwood: “Using a candidate’s UCAS points to assess his potential is a blunt tool and a barrier to social mobility. This is an innovative step by one of the most significant graduate recruiters in Britain. Other graduate employers should follow its lead.”

PwC definitely sees itself as a trendsetter, saying its new recruitment assessment process could drive radical change across its industry. However, these radical changes haven’t happened yet. So far, Deloitte and KPMG, the other two firms in the Big Four, are still sticking to their minimum academic requirements in Britain.

It’s too soon to conclude that the recruitment changes by PwC and EY are a failed experiment.

The war for talent is intense among accounting firms. Businesses can’t stay at the top without thinking out of the box, taking bold steps, and being caring. It should be no different when it comes to how they hire people.

By Errol Oh Optimistically cautious viewpoint

Executive editor Errol Oh joined an accounting firm right out of school. That doesn’t happen in Malaysia anymore.

Related:

Big Four Corporation
The Big Four are the four largest international professional services networks, offering audit, assurance, tax, consulting, advisory, actuarial, corporate finance, and legal services. Wikipedia