IFAC Education Committee Meeting Agenda Item 21.1

March 2005 – New York, United States

IFAC EDUCATION COMMITTEE MEETING

NEW YORK ■ MARCH 2005

COUNTRY REPORT – MALAYSIA

1.Forum and Focus Group Discussion on IES

1.1The MIA and MICPA jointly organised a Forum on International Education Standards for Professional Accountants in September 2004 to provide an insight on the objective and requirements of IES, to assess the current curriculum of accountancy qualifications in Malaysia and to discuss the issues associated with the implementation of IES in Malaysia. The Forum also deliberated on the impact and challenges of globalization on accounting education and the capability of accountants in meeting market demands. Mr Warren Allen, former chairman of the Education Committee, was one of the speakers at the Forum

1.2As a follow-up on the Forum, the MIA and MICPA hosted a Roundtable Discussion on IES, which was held on February 3, 2005. The purpose was to provide an opportunity for the stakeholders of accounting education to examine in greater depth, and for the exchange of views, on the requirements of IES, the current curriculum of accountancy qualifications in Malaysia, and the potential issues that may arise from the implementation of IES. The Roundtable Discussion was participated by senior faculty members from both public and private universities, education sponsoring bodies, employers as well as principal officers of MIA and MICPA.

1.3The Roundtable Discussion focused on the following areas:

  • Overview of International Education Standards (IES)
  • An Assessment of the AccountancyDegree Curriculum −Does It Meet the IES Requirements?
  • Education Excellence : Quality Issues and Global Benchmarks

1.4Dato’ Abdul Halim Mohyiddin presented an overview of the objectives and requirements of IES 1 to IES 7. This was followed by an assessment of the current education and training curriculum for professional accountants in Malaysia against the IES requirements by Asso Prof Dr Susela Devi from University of Malaya. Prof Dato’ Dr Sharifah Hapsah from the Ministry of Education highlighted the initiatives undertaken by the Malaysian government to enhance the quality of higher education in the country.

2.Application of IES in Malaysia

2.1Qualification Framework for Professional Accountants

Generally, the qualification framework for professional accountants in Malaysia have met the essential elements of education,including practical experience, prescribed in IES, as depicted by the following diagrams:

2.2Entry Requirements

2.2.1IES 1prescribes that the entry requirements to a program of professional accounting education leading to membership of an IFAC member body should be at least equivalent to that for admission to a recognised university degree programme or its equivalent.

2.2.2The minimum education requirements for admission to membership of MIA and MICPA have met the requirements of IES 1, as shown below:

  • MIA – An accredited 4-year degree program in accountancy
  • MICPA –An accredited 3 or 4 year degree program with concentration in accountancy or other disciplines or a tertiary level diploma in accountancy and pass the CPA certification program

2.3Professional Education Programme

2.3.1IES 2prescribes that:

  • A programme of professional accounting study should be long enough and intensive enough to permit students to gain the professional knowledge required for professional competence.
  • Students should pursue a degree in accounting, or a professional qualification to gain their knowledge.
  • The content of professional accounting education should consist of:

− accounting, finance and related knowledge

− organisational and business knowledge

− information technology knowledge and competence

2.3.2IES 3 prescribes the professional skills that professional accountants should acquire, including:

  • intellectual skills
  • technical and functional skills
  • personal skills
  • interpersonal and communication skills
  • organizational and business management skills

2.3.3IES 4 prescribes that a program of professional accounting education should provide potential professional accountants with a framework of professional values, ethics and attitudes for exercising professional judgement and for acting in an ethical manner that is in the best interest of society and the profession.

2.3.4The accounting degree programmes accredited by MIA for admission to membership consist of 4 years of full-time study and the curriculum covers broadly all the subject areas prescribed in IES 2. However, there is insufficient emphasis on the learning of professional values, ethics and attitudes, and development of professional skills.

2.3.5The CPA program provided by the MICPA is designed to enhance the technical knowledge and professional skills of potential members. CPA candidates at the Advanced Stage are required to attend workshop sessions where they are expected to participate in discussions, make presentation of group projects and problem solving, before they are eligible to sit for the written examinations. The candidates are also exposed to problems involving professional values, ethics and attitudes in their study as well as to situations of possible ethical implications during their practical experience.

2.3.6The following key issues were highlighted at the Roundtable discussion:

  • Lack of clear definition of the learning outcomes for each subject or module in the education programme so as to ensure that potential professional accountants have acquired the necessary professional capabilities and competence through the process of education.
  • In the degree programs, there is tendency towards a surface approach to learning knowledge across a broad range of subjectswith insufficient emphasis on understanding, application and evaluation.
  • There is a need for the accounting faculties to be trained in teaching methods that will encourage and develop problem solving, analytical and communication skills among students.
  • There is a need for more effective methods of teaching the fundamental principles of professional condust, professional values, ethics and attitudes.
  • There is a need for the accounting faculties to establish alliances with accounting firms, industry and the business community so as to bring in business professionals into the education process. Such alliances will bring education to the real world andequip the students with the necessary capabilities and competence that are required by the changing marketplace

2.4Practical Experience

IES 5prescribes that practical experience should be apart of the pre-qualification program and that the period should be at least 3 years.

Both MIA and MICPA require their potential members to obtain a minimum of three years of relevant practical experience before admission to membership. In addition, the MICPA requires all students to gain their practical experience under the supervision of an experienced member, and students who plan to work in public practice firms are required to serve a 3-year training contract with a member in practice.

2.5Competence Assessment

IES 6 prescribes that the professional capabilities and competence of potential professional accountants should be formally assessed before qualification. It also prescribes that the final assessment should cover the whole range of professional knowledge, professional skills and professional values, ethics and attitudes, and that the assessment is made as near as practicable to the end of the pre-qualification program.

The following key issues were highlight at the Roundtable Discussion:

  • There is a need for closer interaction between the stakeholders of professional accounting education, viz. the government, professional accounting bodies, accounting educators and employers in the education process to identify the competence and capabilities required of potential professional accountants, that are relevant to the needs of business and the community.
  • There is also a need to translate these competence and capabilities into learning outcomes for each discipline in the professional education programme.
  • Going forward, there is a need to develop and implement competence based approach to assessment. The challenge is to identify the performance outcomes and capabilities professional accountants need to achieve competence.
  • There is a need to restructure the education and training curriculum in order to comply with the requirement that the final assessment is made towards the end of the pre-qualification program.

2.6Continuing Professional Education

IES 7 prescribes that member bodies should implement mandatory CPD requirement to ensure that all professional accountants develop and maintain competence relevant to their work and professional responsibilities. It also prescribes that member bodies operating an input-based approach should require the professional accountants to compete at least 120 hours or equivalent learning units of relevant CPD activity in each rolling 3-year period.

Currently, it is mandatory for members of MIA to attain a prescribed quantum of CPD each year. The MICPA intends to implement IES 7 with effect from 2006. Both bodies do not foresee any major problem in meeting the requirements of IES 7.

3.Initiatives of Government

3.1The Malaysian Higher Education Council has recently introduced a Malaysian Qualifications Framework to safeguard and enhance the quality of higher education. The Framework is intended to ensure that all qualification awarded by approved and certified institutions operate within the boundary of transparent criteria, standards, policies and procedures. These include academic, professional and vocational institutions in both public and private sectors, and covers formal, informal and non-formal education. Each qualification is required to be described by learning outcomes, field, nature or purpose of the qualification and the credit or academic load. This will enhance public confidence in the qualification and facilitate determination of the equivalency and recognition of qualifications.

3.2The Framework also provides guidance on domains of learning outcomes, measurement of learning effort or volume of learning (in terms of credits) a student must undertake to achieve a defined group of learning outcomes, methods of assessment and the quality system. The Framework would help to address some of the key issues highlighted above through the total education process.

IFAC/Edcom/Gen/Edcom.Rpt.March05

Prepared by: Claire Egan (February 2005) Page1of 6