The ongoing Covid-19 crisis is having an unprecedented impact on accountants and businesses as the Malaysian economy grinds to a standstill in the wake of the Government’s Movement Control Order which restricts economic and social activities to flatten the infection curve.
On 16 March 2020, the Malaysian Government issued the Movement Control Order (MCO) stretching from 18th – 31st March under the Prevention and Control of Infectious Diseases Act 1988 and the Police Act 1967. This MCO has since been extended to 14 April 2020. Under the Order, all government and private premises remain closed from 18 March to 14 April 2020, except for those providing essential services as defined by the National Security Council e.g. supermarkets and banks.
Understandably, the controls have hit the economy and profession hard. Individuals fear losing their jobs and livelihoods and many companies especially SMEs and micro-businesses are at risk of going bankrupt, which would of course have a detrimental knock-on effect on jobs.
To mitigate the hardship and comfort the people while defending the economy, the Government on 27 March 2020 announced an unprecedented stimulus package valued at RM250 billion that would ensure that “nobody would be left behind.” For its part, the Malaysian Institute of Accountants (MIA), as the developer and regulator of the accountancy profession in Malaysia, continues to extend our fullest support to our members and stakeholders in managing this crisis.
How MIA Helps Members and Stakeholders
Since the MCO was announced on 18 March 2020, MIA has done its best to keep members and stakeholders updated on the implications of the MCO as well as the impacts of the RM250 billion Economic Stimulus Package (ESP). As the voice of the accountancy profession representing the interests of many employers and professionals, MIA also submitted its proposals for economic stimulus to the Government prior to the announcement of the ESP.
Since this MCO is unprecedented, many were confused on their responsibilities. To clarify the impacts especially with regards to permission to operate as well as regulations and compliance deadlines, MIA communicates extensively with the Government, relevant Ministries and agencies as well as our fellow regulators.
For example, many of our practitioners were confused whether MIA Member Firms fall within the definition of “Finance” under essential services, and hence could keep operating throughout the MCO. MIA wrote to the National Security Council and received confirmation that MIA member firms are not defined as “Finance” essential services. Therefore, MIA advised all members and member firms to comply strictly with the MCO by closing their premises from 18 to 31 March 2020 and subsequently to 14 April 2020. “We are happy to report that the profession’s compliance is good. This demonstrates our commitment to upholding trust, integrity and good governance and to protecting the people from the risks of Covid-19 infection, in the public interest,” stated Dr Nurmazilah Dato’ Mahzan, Chief Executive Officer, MIA.
Many members were also worried about meeting the regulatory requirements on financial reporting, annual general meeting and taxation as the MCO would affect productivity. MIA wrote to Bursa Malaysia, Companies Commission of Malaysia and the Inland Revenue Board of Malaysia to highlight the practical challenges faced by the profession and to consider possible measures.
MIA has also taken the initiative to keep members informed of all relevant matters through regular statements and analyses. “The Institute responded immediately to Prime Minister Tan Sri Muhyiddin Yassin’s reading of the RM250 billion Economic Stimulus Package, and we have published circulars and articles in our online knowledge portal e-AT on the impacts,” said Dr. Nurmazilah. More information on the Economic Stimulus Package here.
Under the ESP, RM128 billion is allocated for the people’s welfare, RM100 billion is apportioned to support businesses and SMEs, and RM2 billion is provided to strengthen the economy, in addition to the RM20 billion stimulus announced earlier on 27 February 2020 under the theme “Bolstering Confidence, Stimulating Growth & Protecting Jobs”.
While there are numerous measures aimed at ensuring that “nobody is left behind”, the following are the pertinent highlights of ESP 2.0 for MIA members:
- The Employees Provident Fund (EPF) will provide consultation services for employers beginning 15 April 2020, including the options of payment deferment, restructuring and rescheduling of employers’ contributions. This will ensure cash flow savings of RM10 billion for employers and benefit 480,000 Small and Medium Enterprises (SMEs) and companies while saving more than eight million jobs.
- The Government will also introduce a wage subsidy of RM600 a month for three months for employers with a 50% drop in business since 1 Jan 2020, for workers with a salary of below RM4,000. Eligible employers must comply with the stipulated terms and conditions.
- The Human Resource Development Fund (HRDF) levy is to be exempted for all sectors for six months starting April 2020. Although HRDF may not be applicable to the Public Practice sector, the levy exemption will generally benefit other business sectors.
- Deferment of income tax instalment payment for SMEs for three months starting 1 April 2020.
- The Government and Bank Negara Malaysia (Central Bank of Malaysia) will provide an additional allocation of RM4.5 billion for SMEs and micro entrepreneurs subject to the guidelines issued by the respective authorities.
- The Government, together with telecommunication companies, will provide free internet data usage to their respective customers throughout the Movement Control Order (MCO) period beginning April 1.
- “We hope that the ESP measures will boost the morale of our members, and that member firms in particular will benefit from the concessions that are aimed at saving business and jobs,” said Dr Nurmazilah.
MIA Goes Virtual
Neither is MIA exempt from the Movement Control Order. Therefore, all our offices are closed from 18 March to 14 April 2020 and staff will not be in the office pending further directive from the Government.
“However, we are striving to serve members and businesses to the best of our ability and we are making the most of technology and digital tools to optimise working from home. Despite the closure of our offices, we have ensured that our team will be contactable via online channels,” emphasised Dr. Nurmazilah. She added that as an advocate of digital transformation for accountants and the profession, MIA is walking the talk. The MIA team is in constant communication using the full suite of Microsoft Office tools such as Microsoft teams as well as Skype, and CPD programmes and courses are now being delivered through e-learning channels to ensure the continuing upskilling of members.
These channels are:
CPE Audit: [email protected]
Complaints: [email protected]
CARE Programme: [email protected]
General Enquiries: [email protected]
Membership Matters: [email protected]
Member Firm: [email protected]
Practicing Certificate: [email protected]
Professional Development: [email protected]
Qualifying Examination: [email protected]
Technical Enquiries: https://member.mia.org.my
“We thank our members and our stakeholders for their understanding and patience during this time and we hope that everyone will stay safe. The Institute will continue to closely monitor the situation, maintain close communication with regulators and stakeholders, and notify members of any future developments,” assured Dr Nurmazilah.