Malaysian Institute of Certified Public Accountants

In Malaysia, the Audit Oversight Board (AOB) and the Malaysian Institute of Accountants (MIA) are responsible for establishing and operating quality assurance (QA) review systems in the jurisdiction. The AOB oversees auditors of Public Interest Entities and schedule funds, while MIA operates the Practice Review Programme for firms registered with the Institute. MIA states that the Practice Review Programme forms part of its fulfillment of SMO 1 obligations.

Membership in the Malaysian Institute of Certified Public Accountants (MICPA) is voluntary and MICPA is not the body legally responsible for mandatory QA reviews of audit firms. MICPA members who are registered auditors are also members of MIA and are therefore subject to the QA review systems operated by MIA and, where applicable, the AOB. At the same time, MICPA continues to support audit quality through voluntary review and quality enhancement initiatives for its members.

To support implementation of the quality management standards, MICPA has issued dedicated ISQM 1 resources and continues to provide related training and implementation support. MICPA’s recent reports list the ISQM 1 Guide and Illustrative Manual, the Audit Guide for Practitioners, and Illustrative Audit Working Papers among its key technical resources supporting audit quality. MICPA has also continued to update its practitioner support materials over time.

Since 2016, MICPA has collaborated with MIA on the Quality Assessment Programme, a structured review and capacity-building initiative for small and medium-sized practices. The programme involves review work performed by reviewers appointed by MICPA, including review of a firm’s compliance with ISQM 1 and review of completed audit engagement documentation. Recent MIA and MICPA materials indicate that this collaboration remains active.

Accordingly, MICPA has demonstrated an ongoing process to support the implementation of quality management standards, assist members in improving audit quality, and maintain its level of fulfillment of SMO 1 obligations through continuous support and collaboration with MIA.

Current Status: Sustain

In Malaysia, Initial Professional Development (IPD) and Continuing Professional Development (CPD) requirements for professional accountants are established independently by the two professional accountancy organizations in the jurisdiction: the Malaysian Institute of Accountants (MIA) and the Malaysian Institute of Certified Public Accountants (MICPA).

MICPA is responsible for establishing IPD and CPD requirements for its candidates and members. Under its longstanding collaboration with Chartered Accountants Australia and New Zealand (CA ANZ), formalized through a Memorandum of Understanding, MICPA administers the MICPA x CA ANZ Qualifying Programme, which adopts the CA ANZ professional qualification framework while retaining the Malaysia-specific taxation component administered by MICPA to assess local knowledge.

MICPA has also established practical experience requirements and continuing professional development obligations for its members, which it reports are aligned with the latest International Education Standards (IES). Members are required to submit annual declarations of CPD fulfillment and maintain records of completed CPD activities. Compliance is monitored through periodic audit and random sampling processes. MICPA’s training calendar and CPD offerings continue to be maintained on its website.

To keep members informed of developments in professional standards and education requirements, MICPA regularly disseminates technical updates and educational resources from IFAC, CA ANZ, and other relevant international standard-setting and education bodies. MICPA also continues to organize seminars, forums, and CPD programs related to financial reporting, auditing, ethics, and broader professional practice matters.

MICPA has maintained flexible delivery of its education and CPD activities, including online examinations, virtual CPD programs, student mentoring initiatives, and candidate-focused communications and technical newsletters to support learning and professional development.

MICPA has demonstrated a well-established and ongoing process to fulfill its obligations under SMO 2 and continues to maintain and improve its education and professional development framework.

Current Status: Sustain

Under Part IIIA of the Securities Commission Malaysia Act 1993, the Audit Oversight Board (AOB) is given legislative authority to establish or adopt auditing standards applicable to auditors of Public Interest Entities and schedule funds. This responsibility is exercised through the Malaysian Institute of Accountants (MIA), whose Auditing and Assurance Standards Board (AASB) adopts the pronouncements issued by the International Auditing and Assurance Standards Board (IAASB) without modification.

MICPA continues to be actively involved in the local standard-setting and consultation process in collaboration with MIA. The Institute reviews and deliberates IAASB exposure drafts with practitioners from firms of various sizes, as well as non-practitioners, and uses the feedback from these discussions to contribute to comment letters submitted to the IAASB.

To support implementation of the standards among members, MICPA organizes ongoing training courses and continuing professional development programs on the requirements of IAASB pronouncements, including ISQM 1, ISQM 2, ISA 220 (Revised), ISA 315 (Revised), ISA 540 (Revised), and ISRS 4400 (Revised). MICPA also continues to support firms in addressing areas frequently highlighted in AOB inspection findings, including fraud, sampling, going concern, group audits, and key audit matters.

MICPA has maintained and updated its Audit Guide for Practitioners and Illustrative Audit Working Papers to reflect newly issued and revised ISA and quality management standards. These resources continue to support smaller firms and small and medium-sized practices in implementing current auditing standards.

To support implementation of the quality management standards, MICPA launched its ISQM 1 Guide and Illustrative Manual in September 2022 and continues to provide workshops and implementation support for practitioners.

MICPA has demonstrated an ongoing and well-established process to support the adoption and implementation of IAASB standards and continues to maintain its level of fulfillment with SMO 3 through continuous technical support, training, and guidance.

Current Status: Sustain

In Malaysia, ethical requirements for professional accountants are established by the two professional accountancy organizations: the Malaysian Institute of Accountants (MIA) and the Malaysian Institute of Certified Public Accountants (MICPA), within the broader regulatory framework that includes oversight by the Audit Oversight Board (AOB) for auditors of Public Interest Entities and schedule funds.

MIA’s By-Laws (On Professional Ethics, Conduct and Practice) are substantially based on the International Code of Ethics for Professional Accountants (including International Independence Standards) issued by the International Ethics Standards Board for Accountants (IESBA) and are updated on an ongoing basis to incorporate revisions to the international Code. The most recent national update was issued in November 2024, effective 15 December 2024, with subsequent 2025 updates also reflected in the national framework.

MICPA continues to align its ethical requirements and member guidance with the national framework and the latest IESBA developments. The Institute actively supports implementation through technical programmes, ethics-related continuing professional development, and dissemination of updates relevant to members in public practice and business.

To support ongoing alignment with international developments, MICPA participates in the international standard-setting process by reviewing and responding to exposure drafts issued by the IESBA, including recent consultations on sustainability-related ethics standards and other revisions to the Code.

MICPA has demonstrated a well-established and ongoing process to maintain its fulfillment of SMO 4 obligations and continues to support continuous improvement in ethical awareness and implementation among its members.

Current Status: Sustain

The Department of the Accountant General of Malaysia, established in 1946, is responsible for the accounting functions of both the federal and state governments in Malaysia and for the development and maintenance of the Malaysian Public Sector Accounting Standards (MPSAS) framework.

Public sector financial reporting requirements are established by the Government Accounting Standards Advisory Committee (GASAC) and the Accountant General’s Department. MPSAS are accrual-basis national standards adapted from and substantially aligned with the International Public Sector Accounting Standards (IPSAS). The Department continues to maintain and update the MPSAS Handbook, with the most recent 2023 edition publicly available.

MICPA does not have direct responsibility for defining public sector financial reporting requirements. However, the Institute continues to support public sector standard-setting and implementation through its representation on the relevant advisory and consultative structures and through technical engagement with the Accountant General’s Department.

MICPA has been an active participant in Malaysia’s transition from modified cash-basis accounting to accrual-basis MPSAS, including contributing technical expertise to the development and implementation of the government’s accrual accounting roadmap. MICPA has also supported IPSAS and MPSAS implementation through technical discussions, review of consultative documents and exposure drafts, and the provision of training and capacity-building activities for ministries and state accounting departments.

MICPA continues to promote IPSAS-aligned public sector financial reporting and has demonstrated an ongoing process to maintain its fulfillment of SMO 5 obligations through continuous engagement, technical support, and public sector capacity-building initiatives.

Current Status: Sustain

The Malaysian Institute of Certified Public Accountants (MICPA) is responsible for establishing and maintaining an investigative and disciplinary (I&D) mechanism for its members and continues to operate a formal system to execute this process.

MICPA reports that it has reviewed its I&D system and that it incorporates the requirements of Statement of Membership Obligation 6 (SMO 6). The system includes both an Investigation Committee and a Disciplinary Committee. The Investigation Committee is responsible for reviewing complaints and referring matters, where appropriate, to the Disciplinary Committee for further action and decision-making.

MICPA reports that, upon admission to membership, individuals are provided with the Institute’s Constitution and By-Laws, which include the relevant provisions and procedures relating to investigation and discipline. The Institute also coordinates with other bodies, including the Malaysian Institute of Accountants (MIA), in cases involving suspected serious misconduct, offences, or breaches of professional obligations.

MICPA has continued to maintain the operation of its I&D framework, including through virtual and hybrid procedures where appropriate, with the relevant amendments incorporated into its Constitution and By-Laws and approved by the Companies Commission of Malaysia.

MICPA maintains well-established ongoing processes to fulfill its obligations under SMO 6 and continues to review and improve its framework as part of its commitment to continuous improvement.

While MICPA’s own I&D framework is aligned with the requirements of SMO 6, the Institute should continue to advocate with MIA and relevant regulators for broader jurisdiction-level alignment of all I&D systems with SMO 6 requirements, including stronger coordination across regulatory bodies, transparency of sanctions, and alignment of appeals and referral processes.

Current Status: Sustain

Under the Financial Reporting Act 1997, the Malaysian Accounting Standards Board (MASB) was established as an independent authority to develop and issue accounting standards for the preparation of financial statements in Malaysia.

Accounting standards for entities other than private entities are the Malaysian Financial Reporting Standards (MFRS), while private entities apply the Malaysian Private Entities Reporting Standard (MPERS). The MFRS Framework is maintained as word-for-word identical to IFRS Accounting Standards and is updated on an ongoing basis. MPERS is based on the IFRS for SMEs Accounting Standard, with limited jurisdiction-specific modifications, including for real estate-related requirements.

The Malaysian Institute of Certified Public Accountants (MICPA) continues to support the implementation of MFRS and IFRS through technical guidance, participation in the local standard-setting process, and capacity-building for its members.

MICPA reviews consultation documents and exposure drafts issued by MASB and contributes to the standard-setting process through participation in MASB working groups, task forces, and other consultative forums.

In addition, MICPA participates in the Malaysian Institute of Accountants’ Financial Reporting Standards Implementation Committee, where implementation issues related to MFRS and IFRS are discussed and technical guidance is developed.

MICPA also supports implementation through technical updates, training programmes, seminars, and technical assistance for members to facilitate the proper application of MFRS and IFRS requirements.

At the international level, MICPA continues to participate in the standard-setting process by reviewing and responding to International Accounting Standards Board (IASB) exposure drafts and other consultative documents.

MICPA maintains well-established ongoing processes to fulfill its obligations under SMO 7 and continues to support continuous improvement in the adoption and implementation of IFRS Accounting Standards in Malaysia.

Current Status: Sustain