MICPA COVID-19 Resource & Support

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COVID-19 has gone global and World Health Organisation declared a pandemic. While the impact of this pandemic on people’s health is paramount, its effect on the world economy is going to be monumental. It is having an effect on individuals, businesses and the public at large. MICPA is closely monitoring the development of COVID-19, to share information with members on a timely basis as well as to ensure we are taking the appropriate action to protect the wellbeing of our members, stakeholders and employees.

Our members, both professional accountants in business and in public practice, have an important role amidst and post-pandemic, as they provide advice and support to businesses facing the economic backlash of COVID-19. These resources, along with the latest information from the Malaysian Government and regulatory bodies, will provide support to our members and their clients in navigating these unprecedented times.

Institute Updates

Movement Control Order 2.0

In line with the Government’s announcement on January 11, 2021 to implement a Movement Control Order in Penang, Selangor, Federal Territories (Kuala Lumpur, Putrajaya & Labuan), Melaka, Johor and Sabah from January 13 – 26, the Institute’s office will remain closed during this period with staff working from home.   All meetings and events are to be held virtually.

Should you need to reach us, here are the email addresses of our key services:

Technical: technical@micpa.com.my
CPD: cpd@micpa.com.my
Membership: membership@micpa.com.my
Student Affairs: jess@micpa.com.my
Examination: exam@micpa.com.my
Finance: ksl.acc@micpa.com.my
Other Matters: micpa@micpa.com.my

Technical Updates

Our Technical team continues to monitor any developments or updates from our local regulators, and will be issuing urgent circulars to our members on Tuesdays, on top of the usual Friday email blasts.

Advice & Support

MICPA Technical Insight

COVID 19 Determining Materiality

COVID-19 is having a profound effect on many businesses and we can expect to see this continue into future financial reporting periods. Whether businesses are experiencing a temporary downturn as a result, or more radical changes, COVID-19 is likely to impact how materiality in audits is determined by auditors and the choice of benchmarks used.

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Accounting Considerations due to the Impact of COVID-19

While businesses are facing negative impacts on the Malaysian economy, entities would also need to assess the impact of the COVID-19 pandemic on financial reporting. In Malaysia, most of the entities are required to limit or suspend their business operations in view of the introduction of the Movement Control Order. In fact, this poses a significant impact on Malaysian financial markets, resulting in accounting implications for many entities.

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Audit Considerations in respect of Going Concern due to the Impact of COVID-19

The uncertainty in the economy arising from the COVID-19 has also created an impact on the entities that have not been encountered before. This may result in significant financial reporting implications for preparers of financial statements. The same also impacts the work of auditors. In view of this, the Institute wishes to highlight to auditors a specific matter relating to the going concern concept, arising from COVID-19.

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Mitigating the Impact of COVID-19: Learning Points

Economically, this year is shaping up to be the worst year since the Great Depression of the 1930s. The relentless spread of the coronavirus disease (COVID-19) has resulted in over a million infected, tens of thousands killed, wrecked global supply chains, and laid low many economies. It has been a bloodbath in the stock markets.

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IAASB

Auditor Reporting in the Current Evolving Environment Due to COVID-19

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Review Engagements on Interim Financial Information in the Current Evolving Environment Due to COVID-19

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Auditing Accounting Estimates in the Current Evolving Environment Due to COVID-19

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Guidance on Auditor Considerations Relating to Subsequent Events in Light of Changing Environment Due to the Covid-19 Pandemic

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Guidance on Auditor Considerations Relating to Going Concern in Light of Changing Environment Due to the COVID-19 Pandemic

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Highlighting Areas of Focus in an Evolving Audit Environment Due to the Impact of COVID-19

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Government Directives

Ministry of Finance (MoF)

To cushion the current economic onslaught of COVID-19, the Malaysian Government has rolled out several stimulus packages to support the Nation:

1) 2020 Economic Stimulus Package

2) PRIHATIN Rakyat Economic Stimulus Package

3) PRIHATIN Rakyat Economic Stimulus Package (Additional)

4) PENJANA Short-Term Economic Recovery Plan

5) Special Announcement on Kita Prihatin

6) Special Announcement on PERMAI Assistance Package NEW

7) Program Strategik Memperkasa Rakyat dan Ekonomi (PEMERKASA) NEW

Federal Gazette

Ministry of International Trade and Industry (MITI)

Following the Movement Control Order (MCO) announced by the Government on January 11, 2021, the Ministry of International Trade and Industry (MITI) has issued a statement in a media release on January 12, 2021 confirming the five (5) essential economic sectors that are allowed to operate during the MCO period in the six (6) affected states, namely Selangor, Penang, Melaka, Johor, Sabah and the Federal Territories (Kuala Lumpur, Labuan and Putrajaya).

The five (5) essential economic sectors have been determined as follows:
• Manufacturing sector (under the oversight of MITI)
• Construction
• Services
• Trade and distribution sectors
• Plantations and commodities

Resources:

Regulatory Response

Bank Negara Malaysia (BNM)

Bursa Malaysia (The Exchange)

Companies Commission of Malaysia (SSM)

Inland Revenue Board (IRB)

Royal Malaysian Customs Department (RMCD)

1) Operations and Services during MCOs

2) FAQ on Indirect Tax Initiatives Announced during the Short-Term Economic Recovery Plan (PENJANA)

3) FAQ (Bil. 2/2020)

4) Penalty in MySST System for Late Payment of Taxes on Taxable Period Included in the Movement Control Order Period

5) Others

Securities Commission (SC)

Malaysian Accounting Standards Board (MASB)

Perbadanan Insurans Deposit Malaysia (PIDM)

International Updates

IFRS Foundation

International Federation of Accountants (IFAC)

International Accounting Standards Board (IASB)

International Organisation of Securities Commission (IOSCO)

The World Bank

World Bank provides US$5.1m for Samoa COVID-19
East Asia and Pacific: Countries Must Act Now to Mitigate Economic Shock of COVID-19
Macroeconomic Policy in the Time of COVID-19: A Primer for Developing Countries (NEW)

International Ethics Standards Board for Accountants (IESBA)

International Public Sector Accounting Standards Board (IPSASB)