CPA Australia and MIA collaborate to improve understanding of company annual reports

KUALA LUMPUR, MALAYSIA – Media OutReach – 1
September 2021 – CPA Australia and the Malaysian Institute of
Accountants (MIA) have collaborated to update two important resources for improving
the financial literacy of Malaysian investors and businesses; “A Guide to
Understanding Annual Reports: Malaysian Listed Companies” and “A Guide to
Understanding Auditing and Assurance: Malaysian Listed Companies.”

The two guides have been updated to reflect
developments in reporting over the past seven years, including changes in
non-financial reporting (such as the Malaysian Code of Corporate Governance
2021 and International Integrated Reporting Framework) and auditor reporting requirements.

CPA Australia
Malaysia Country Head Priya Terumalay said the growing complexity of annual
reports and auditor’s reports highlights the importance of educating users so
that they can extract meaning and value from these documents.

“The ability to understand the financial health
of a company is a vital skill for investors, entrepreneurs, managers and other
business stakeholders. It enables them to identify promising opportunities and
avoid undue risks, resulting in more strategic economic decisions.

“The framework for
reporting and the requirements for auditing and assurance have evolved in
tandem with an increasingly complex global business environment. These guides provide much needed clarification
and explanation of annual reports and auditor’s reports,” said Priya.

MIA Chief Executive Officer Dr. Nurmazilah Dato’ Mahzan prioritised the
growing need for financial literacy to support sustainable economic
development. “As the national accountancy body that puts
nation building at the forefront, MIA recognises the need to educate
shareholders and other providers of capital who are not conversant in financial
reporting standards, auditing and assurance matters as well as certain rules
and regulations affecting the financial statements.”

To
further improve corporate reporting towards enhanced business sustainability,
Dr. Nurmazilah highlighted the key new development of value reporting, which is
the formation of the Value Reporting Foundation and ongoing work on the
convergence of integrated reporting and sustainability reporting.

“The
end result of value reporting will be more comparable, consistent and reliable
information that enables more holistic decision making by businesses and
investors. The move towards value reporting will also facilitate adoption and
disclosure of environmental, social and corporate governance (ESG) matters,
including climate change risks which are emerging as the biggest future risk to
the sustainability and survival of businesses and society,” Nurmazilah said.

The 2021 edition of the “Guide to
Understanding Annual Reports: Malaysia Listed Companies” provides an overview
of financial statements and a glossary of financial terminology, among other
insights. This is particularly relevant during company reporting season when
investors are reviewing their investments and making decisions based on their
ability to read what’s behind the numbers.

The 2021 edition of
the “Guide to Understanding Auditing and Assurance: Malaysian Listed Companies”
is a plain language guide for shareholders and other stakeholders who are not
experts in auditing and assurance, to help them better understand information
they receive from auditors about their companies.