Discuss the Role of Malaysian Aob

Discuss the role of Malayan AOB ( scrutinise Oversight Board) When was the AOB mickle up? The Audit Oversight Board (AOB) is leavened to a lower place get down IIIA of the Securities deputation Act 1993 (SCA) which came into force on 1 April 2010 to promote and smash an effective scrutinise c be frame throw and to promote confidence in the flavour and reliability of take stocked financial statements in Malaysia. The chronology of events of establishing AOB in Malaysia is as constitute September to October 2007 Budget 2008 Announcement by YAB PM Government impart establish a Public Companies Accounting Oversight Board down the stairs the auspices of the SC.Consultations held with industry groups and regulators. January to April 2008 Appropriate audit oversight framework for Malaysia Securities way (Amendment) Bill 2009 which contains the founding and functions of the AOB passed in both Houses of Parliament. December 2009 Securities Commission (Amendment) Bill 2009 which contains the establishment and functions of the AOB passed in both Houses of Parliament. 1 April 2010 objet dart IIIA Securities Commission (Amendment) Act 2010 came into force. (Establish of Audit Oversight Board) What is it supposed AOB to do?Under Part IIIA of the SCA 1993, AOB is responsible to 5 major functions in order to assist the credential Committee (SC), which listed as below (i)Standard setting AOB has the causality to direct the Malaysian Institute of Accountants (MIA) to establish, adopt, amend, modify, alter or by any combined ways, the auditing and good standards to be applied by interpreted meeters. It is also responsible to implement policies and programmes in ensuring an effective audit oversight system in Malaysia. (ii)Registration Auditors of public entertain entities (PIEs) must register and recognized by AOB to ensure the auditing process is equip and proper.It is an offence for non-registration. (iii)Sanctions AOB has the power to impose approp riate sanctions against registered meeters who fail to comply with auditing and ethical standards. (iv)Inspection In accordance with Section 31V(1) of Part IIIA of the SCA, the registered audit firm and attendee give be subject to critical reviews by the AOB to assess the degree of ossification withthe auditing and ethical standards by the attender and the quality of the audit reports prep atomic number 18d by the attendant relating to the audited financial statements of the PIEs. v)Inquiry Section 31W of the SCA on the opposite hand empowers AOB to exonerate an inquiry if there is a reason to believe that any auditor has contravened any provisions of Part IIIA of the SCA, any condition imposed under section 31O(4) of the SCA or any written nonice or guidelines issued by the SC. Why do we need an AOB? The need of audit oversight control panel (AOB) is to make sure all audit procedure is follow in all likelihood by the auditor. By doing this it is means that AOB is the on e who check the work of audit.In other way it as act audit oversight framework in Malaysia. It is important to have AOB is because by doing so, audit work ar much real. alike that, AOB needed to promote confidence in the quality and reliability of audited financial statements in Malaysia. There are legion(predicate) cases which involve the quality of audited reported such as Enron, Parmalat, World Com, Transmile and etc. By having a more independent party the AOB, which promote more confidence and reliable report. Thus create interest for investor to invest in Malaysia market.What is the AOB achieved so farthermost? Based on the news of AOB on The Edge magazine on 4 October 2012. AOB has formed an official collaboration in audit oversight with the Japan Financial Services Authority and the Certified Public Accountants Audit Oversight Board (CPAAOB). This collaboration would facilitate audit regulators to oversee go after border audits towards enhancing the soundness of the se curities markets and investor protection in the respective(prenominal) countries, said by chairman Nik Mohd Hasyudeen YusoffThe SC said the collaboration was the AOBs first positioning with other regulators outside the Asean region. The official cooperation will allow the audit regulators to ploughshare information upon request, with respect to foreign audit firms that fall within the respective regulatory jurisdiction. This will, eventually, promote the confidence of overseas users in using the audited reports in Malaysia. What are the findings and consequences of AOB so far? After the establishment of AOB, there are a certain major change in the audit field.All audit firm are require to register their company with AOB in Malaysia. The register of audit firm is need for AOB to continue measuring the audit work of the firm. Based on AOB, every company partner will be measure their work every few year. Audit partner licenses will also be forfeit if found their work are not in tit h e correct procedure. This action, have cause many auditor to do more work or more running(a) paper. By doing so, much cost will be incurred to the audited firm.The reason auditor doing so is to search for more audit evidence and also to bar being sack as an auditor. On 16 July 2012, there are partner being penalized by AOB after few year of establishment of AOB. The senior partner of a mid-tier business relationship firm is the first auditor to be penalized for breaching a condition imposed when he registered with the board. Last Thursday, Alvin lay Guan Pian of UHY Malaysia was reprimanded for failure to comply with the relevant requirements of the recognized auditing standards in Malaysia i. . the International Standards on Auditing. ( Enrol Oh, Starbiz, 2012) Audit oversight board is also given the power to penalized a auditor if found misstatement in audit report. By doing so, the auditor report are more reliable to external user due(p) to there is another independent body which is the AOB involve in the Malaysia audit field. In a whole, the establish of AOB had promote more advantage to the audit firm compare to disadvantage. It is similar to what other countries have experienced?Malaysia are not the first artless which establish AOB, but Malaysia are the second country in ASEAN country and top 10th is Asian country which establish AOB. This has show that Malaysia auditing practices are following the improvement of international standard. Besides that, also show Malaysia is concern about the change in accounting standard to other country. AOB in other countries which have already establish are similarly same in their function of standard setting, registration, sanctions, inspection and inquiry.