Malaysia’s External Auditing: The Case of The Better Tool For Analysis

Azham Md. Ali
Faculty of Accountancy, Universiti Utara Malaysia
Kedah Darul Aman, Malaysia
Stuart Turley
Manchester School of Accountancy and Finance
University of Manchester, Manchester, England

Abstract:
Various rationales for external auditing appear to have limited application in the context of Malaysia where the auditors exist in an environment marked by little publicity and little public clamour for needed changes although the same environment is tarnished by numerous cases of corporate illegality, unaccountability and the use of questionable business practices. This situation is in marked contrast to that confronted by auditors in Anglo-Saxon countries and their counterparts from other developing countries in Asia such as India, South Korea and Singapore.  Therefore, to appreciate "how" the social role of auditors is determined or "why" audit is executed in Malaysia, it is necessary to situate the interaction between "society" and the audit function within a proper "context" that includes history and environmental factors. It is accordingly suggested that a research conducted by applying the political economic theory - introduced by Tinker (1980) and refined by Cooper & Sherer (1984) to explain accounting experiences - driving an enlarged exogenous analytical framework of processual change analysis - developed by Smith (1973) and adapted to accounting by McKinnon (1986) - which in turn is supported by the qualitative case study research strategy that stresses the use of oral and documented evidence should be the more appropriate vehicle.  

Volume: 7 No: 1

The Knowledge Gap And Deficient Performance Gap Between Auditors and Corporate Managers: An Empirical Study in The Context of Malaysia

Teck Heang Lee
Faculty of Accountancy and Management
Universiti Tunku Abdul Rahman
Azham Md. Ali
School of Accountancy, Universiti Utara Malaysia

Abstract:
This paper reports the findings of a questionnaire survey of “knowledge gap” and “deficient performance gap” conducted in Malaysia on auditors and corporate managers. A total of 47 auditors and 72 corporate managers in Klang Valley responded to the survey. The aims of the study are two folds. Firstly, it ascertains the knowledge of the auditors and corporate managers on the duties of auditors as required by the Malaysian Companies Act 1965 and the Malaysian Approved Standards on Auditing. Secondly, it elicits the perceived performance of auditors in relation to these required duties. The results of the study indicate the existence of “knowledge gap” and “deficient performance gap” between auditors and corporate managers. Overall, the results indicate that: i) the auditors in Malaysia are knowledgeable about their duties and ii) the corporate managers have limited knowledge about auditors’ duties and they are less satisfied with some of the duties of performed by the auditors.

Volume: 7 No: 1

Shariah’s Claim Againts Claims Settlement

Mohd Abdul Samad
Director Al Nouf Inc.Hyderabad, India
SK Safiudin
Dept of Commerce and Business Management, MANU University Hyderabad


Abstract:
The sole aim of this research paper is to fight the proponents of the conventional insurance system and also that of the present financial system as a whole which is based on the pillars of Interest (Riba), Uncertainty (Gharar) and Maisir (gambling). We need to fight the proponents on their own turf by bringing out the ill effects of the conventional insurance system. Therefore this research paper aims at providing a general view about the conventional insurance status and focus on benefits of Islamic Insurance system (Takaful). This research paper also aims at offering an integrated basis for promoting international policy dialogue among stakeholders towards fostering an orderly development of an efficient, sound, resilient and sustainable conventional insurance system in the rapidly changing global market, technological and regulatory environments. Insurance in the financial services industry is supposed to play a very vital role in addressing perennial human development and socio-economic problems and achieving sustainable economic development and just social progress by efficiently and equitably channeling financial resources towards productive opportunities and employment generation. Insurance is all about protection and it is important to protect ourselves and our possessions against damage and harm from unforeseen events.  We need to see whether the present conventional insurance is really meeting the expectations of the policy holders at large (as there is no justification to have a system which keeps a handful happy by depriving a vast majority of their hard-earned earnings). Ultimately taking above considerations into account some hard core critics of the present conventional insurance system have stated that ‘life insurance contract keeps one poor all the life, so that one die’s rich’. Rather it should be like ‘Security is about…cementing the weak link, as ‘the future will be not be more of the same……we need to be ready’.

Volume: 7 No: 1