Audit & Assurances
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| Our Services of Auditing Function Including : |
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| Statutory financial audit of financial statements required by Companies Act 1965, ("New" Companies Act 2016, effective 31/1/2017) |
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| Licensed manufacturing warehousing ("LMW") audit |
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| Special physical sighting of fixed assets of a manufacturing company |
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| Special audit on specific class of transactions or areas of interests as required |
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Special half end review
or audit |
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Compilation of
Financial Report
(for example used in Singapore for small medium enterprise exempted from audit) |
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| Internal control review |
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| Due diligence audit |
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| Solicitor's certification & accountant report |
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| Income tax field audit & investigation assessment |
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SST field
audit assessment |
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| Other types of assurance services tailored to your needs |
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| Audit exemption |
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Audit is our core business and the founder of J. K. Tan & Co has obtained the approved company auditors’ license from the Ministry of Finance Malaysia (MOF). We are a firm, registered with the Malaysian Institute of Accountants (MIA) based in Johor Bahru. With the changes of stakeholders’ expectation, we are target to provide the competent and professional services in order to better meeting the investors expectation to provide the completeness, accuracy and fair presentation of information in the audited financial statements.
Our firm is focus on high level of quality of auditing services, in line with the International Standards of Quality Control (“ISQC 1”) compliance. We are in compliance with approved applicable accounting standards issued by the Malaysian Accounting Standard Board (“MASB”) either for private entities or other than private entities. We are in compliance with 36’s Clarified International Standards of Auditing. We are to apply the MIA by-Laws, The International Ethics Standards Board for Accountants (IESBA's) Code of Ethics for Professional Accountants. And we are independence and adopt professional skepticism in every audit engagements we undertaken. |
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What's Audit?
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According to International Standard of Auditing (ISA) 200, “Overall Objectives of the Independent Auditor and the Conduct of an Audit in accordance with the International Standards of Auditing”,
“The objective of an audit is to obtain a reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, thereby enabling the auditor to express an opinion on whether the financial statements are prepared, in all material respects, in accordance with an applicable financial reporting framework”
“To report on the financial statements, and communicate as required by the ISAs in accordance with the auditor’s findings.” |
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Audit in Malaysia, auditors express opinion whether financial statements give a true & fair view in accordance with approved accounting standards issued by the Malaysian Accounting Standards Board ("MASB") and requirements of the Companies Act 2016, in Malaysia.
The applicable accounting standards are Malaysia Financial Reporting Standards ('MFRS") or Financial Reporting Standards ("FRS") or Malaysia Private Entities Reporting Standards ("MPERS"). MFRS or FRS is use for entities other than private; on the other hand, MPERS which came into effect on 1 January 2016 for private entities. |
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Why Need Audit?
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In Malaysia, auditing profession is required for every Companies incorporated under the Companies Act 2016. It serves as a check and balance to better enhance the reliability and creditability of audited financial statements, in which various stakeholders used it as a source for reference.
In additions, in the course of audit, our audit procedures also able to help detecting any internal control weaknesses encountered and suggest recommendations for both present and future challenges. We will communicate to the Board of Directors or Audit Committee (listed company) of any deficiency in internal control.
Auditors reports have been widely used as reference to apply bank loans facilities as it is certified by an independent third party. The reliability is more than management accounts which is subject to certain manipulation in general or errors due to incompetent account assistants. |
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Frequently Ask
Questions on Auditors:
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| Who is the company auditors? |
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The company auditor is licensed from Ministry of Finance ("MOF"), and normally would set up firm under the partner's name, registered with the Malaysian Institute of Accountants ("MIA"), under the AF - Audit Firm.
To be an approved company auditor in Malaysia, MIA members are required to apply to the Minister charged with the responsibility for finance to be approved as a company auditor pursuant to Section 263 of the Companies Act 2016.
When applying to become an approved company auditor, apart from fulfilling the necessary working experience and other mandatory requirements, the applicant is required to go through an interview conducted by the Interview Panel at the Accountant General’s Office. |
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| What is the difference between accountants & auditors? |
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| Accountant is someone that has gained 3 years experienced to admit as MIA members, but an auditor is someone who sit & passed for the license interview set of MOF, panel by Suruhanjaya Syarikat Malaysia, Bank Negara Malaysia, Securities Commission of Malaysia, and MIA. |
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| Why need the independence of accountants & auditors? |
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| An audit is an external 3rd parties, independent verify, testing, collecting evidence and expressing opinion on Company financial statements whether is true & fair and has no material misstatement. The credibility of financial statements are useful for bank loan, apply foreign workers, tenders and etc. Therefore, it is important to choose an approved company auditors. |
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| Businesses see audit as an extra costs as compare to corporate taxation. Is it correct? |
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| No, management accounts are prepared by account staff (human), cannot avoid errors in entering transactions. A good auditor can detect the errors in double entries, significant fluctuation in figures, and detect irregularity. The important in selecting auditor with high integrity & follow the rules & regulations. Pay the right tax. Tax is a form of contribution for country growth. |
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| Why some audit firm didn’t perform audit physical stock observation but my auditors want to come checking? |
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| According to ISA 501, when the stock is material, auditors need to attend the physical stocktake observation. During the stocktake, auditor will pick the sample & test-check including recount if correct. This is to ensure the all stock has been taken in & no third parties/ obsolete stock counted. |
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| I do not want to provide provision for doubtful debts even though more than 1 year of debtor due to non deduction according to tax. |
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| There are no standard guidelines on how long need to provide provision for non collection. But, general is based on financial reporting which exceed the credit term, shall provide. A minimum of subsequent payment after financial year-end the debts been collected or the directors should confident of collection. |
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| My auditor sent me management letter, but I don’t understand what is it? |
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| Management letter is a form a formal communication which auditors wrote to client regarding on deficiencies in internal control weaknesses & recommendation on how to improve. Client normally need to answer auditors how want to improve for future audit. |
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| My friend told me his auditor is charging very cheap & can finish within 1 week, shall I change? |
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The audit fee charge is quite standard, have a standard table to follow (for example fee guideline), but can adjust according to time spent.
On the whole time spent for audit, a simple trading company needs approximately 2-3 weeks, including manager review. As such, one week can mean just simply draft report without checking, it defeat the purpose of audit. In conclusion, audit is mean to check errors due to human data entry but as long as the whole financial statements are still reliable, a clean report will be issued. |
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| My auditors give me unmodified opinion audit report, is it mean any issues of my report, according to English grammar? |
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| According to ISA, an unmodified report is a report without any modifications or qualified statement to highlight to the user of financial statements, thus simply mean clean report. |
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When to
Appoint Auditors?
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The first directors can appoint an auditor at any time before the first Annual General Meeting (“AGM”) to hold office until the conclusion of that AGM. The reappointment of auditor is from an AGM until the conclusion of the next AGM.
Where there is a causal vacancy arises from disqualification, removal or resignation of an auditor before the end of his term of office, the directors or members may appoint a new auditor, provided the auditor is qualified and has not been previously disqualified from acting as an auditor. |
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Statutory Rights &
Obligations of Auditors
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| Right to Remuneration |
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| An auditors’ remuneration is fixed by a Company in a general meeting, it is common practice, at the same meeting, to give directors authorization to fix the remuneration. |
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| Right to Access Information |
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Sec 174(4) CA1965
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- Auditors unrestricted right to access books, accounts and vouchers of clients at all time.
- Auditors to obtain information and explanation from the officers of the company necessary for the performance & completion of audit.
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Sec 174(3) CA1965
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- Auditors must stated clearly in audit report whether they have, the best of knowledge and belief.
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Legitimate Approved
Company Auditors
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| Members of the Public are reminded that under the Accountants Act 1967, no person shall practise or hold himself out as a Chartered Accountant or Licensed Accountant providing public practise services unless the person is registered with MIA. |
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| To get audit license, candidates must accumulated relevant years of experiences + apply & passed the audit license interview by Ministry of Finance Malaysia (MOF). |
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| View Morearrow |
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Statutory audit should be done by Malaysian
Institute of Accountants member firms. |
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| View Morearrow |
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Testimonial
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"I am Pier from Island Paradise, 20 years tour agent company in Johor Bahru. We used J.K.Tan & Co for 6 years, the Co. has a co-operative team & managed to complete our account submission timely.
Also, they advise us on our account matters, discover any omission of invoices such as purchases or expenses. They form good understanding with our account personnel to prepare a proper and compliance accounts. Thus, I highly recommend J.K.Tan & Co as your auditor & tax agent" |
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| Pier Chea |
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Island Parade Tour &
Travel Sdn. Bhd. |
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