1. The document discusses MIA's roles in enhancing audit quality through its professional and regulatory roles. Its professional role includes members development and setting professional standards, while its regulatory role includes enforcement, surveillance, and standard setting for auditing and ethics. 2. MIA's practice review program selects audit firms for review based on risk, and rates them from satisfactory to unsatisfactory depending on compliance with standards. Firms must formulate remedial action plans to address deficiencies by analyzing root causes relating to quality control elements. 3. Challenges include pushback from stakeholders and lack of awareness on standards. MIA addresses this through education, separating regulatory functions, and collaborating with other bodies. It publishes annual practice

1. 1
AFA IFAC SMO Workshop 1
Sharing by MIA Practice Review

2. 2
Balancing
MIA’s DUAL ROLES
ETHICAL & COMPETENT
ACCOUNTANTS
Professional
Role
Statutory/
Regulatory
Role
MIA Roles :
 Members
Development
 Professional
Standards &
Practices
 Capacity
Building
MIA Roles :
 Enforcement
 Surveillance
 Standard
Setters –
Auditing &
Ethics
 Accreditation/
Review of
Qualification
Serve members
through
continuous
education and
development
Safeguard public
interest & uphold
the profession’s
reputation

3. MIA’s
Professional
Role in Audit
Quality
Enhancement
3
• SMP Roadmap 2015- 2021

4. Enhancing
Competency
and Capacity
of SMPs
4
QAP Programme
Practical Audting
Methodology for SMPs
Audit Guide for
Practitioner (AGP) and
Illustrative Audit
Working Papers (IAWP)
Publication of
Illustrative MPES
Financial Statements,
with Commentaries

5. MIA’s
Regulatory
Role in
Quality
Enhancement
5
• To regulate and develop the
profession of accountancy in
Malaysia
Accountants
Act 1967
• Included in the By-Laws (thus
ensuring compliance by all
members)
Practice
Review
• Shared with the Audit Oversight
Board (AOB), which looks at the
audit of PIEs
Shared
Responsibility

6. PRACTICE REVIEW PROGRAMME
02
03
WHAT?
First introduced in 2003
& subsequently revised
in 2017
01 WHO?
All members in Public
Practice is required to
submit to this Programme
SELECTION?
Risk based
approach
Quality Assurance
&
Practice Review

7. Importance of Practice Review towards
Achieving MIA’s vision
NATION
BUILDING
Competency
Quality
Good governance
Public trust
Compliance
Enhance public assurance and trust to
support nation building
Ensure that all members in public
practice comply with all applicable
professional standards, and legal and
regulatory requirements in the
performance of the audit work
Mould a robust and ethical profession
that upholds good governance and
integrity
Assess and strengthen the quality of
the public practitioners
Drive capacity and competency building
for public practitioners
5
4
2
3
1

8. • Audit firms are selected for review based on
its risk profile. A higher risk profile firm is
reviewed ahead of a less risk profile firm.
• Audit firms may also be selected for review
based on referral from other regulatory
bodies in Malaysia or other committees of
the Institute
R
I
S
K
RISK BASED APPROACH
How we do
it?
8

9. Scope of
Review
• Firm Level Inspection
 Ensure compliance with ISQC 1 and MIA By-Laws
• Engagement Level Inspection
 Performing inspections of individual engagements
to ensure the audit work is conducted in
compliance with applicable professional standards
 Samples of files selected for practice review should
be reflective of the firm’s overall operations and
size
9

10. Types of
Rating
• Type 1 – Satisfactory
• Type 2 - Assurance of Compliance Required
• Type 3 – Remedial Action Plan (RAP) Required
 Corrective actions can be taken (Remediation and
root cause analysis (RCA))
 Monitoring review
• Type 4 – Unsatisfactory
 Disciplinary actions
10

11. 11
4 Types of
Rating

12. Formulating an Effective Action Plan
Remedial
Action Plan
Imperative to ensure that firms are
able to formulate remedial plans
that are targeted to
address the relevant underlying
deficiencies in the practice.
Addressing the root cause
Avoids temptation of settling on a
cursory “quick fix” answer which
does not address more difficult
underlying issues
Long-term focus
The responsibility/ ownership over the
operation of the firm and the way
how audit is conducted ultimately lies
with the partners/ practitioners. Hence,
other parties should not be blamed for
poor quality.
Does not seek to establish a blame
culture
What firms need to do is to understand,
at a very fundamental level, the firm-
wide underlying deficiencies and what is
hindering the realization of an effective
system of quality control.
Do not merely resolve the symptoms
3
1 2
4

13. ROOT CAUSE ANALYSIS (RCA)
Deficiencies identified
should be addressed by
looking at the underlying
issues i.e. the root causes
Practitioners must take an in-depth
analysis of their firms based on the
six elements of ISQC1 in order to
identify root causes that detract from
audit quality, be it in areas such as the
firm’s structure, leadership, culture,
policies and procedures, audit
methodology and human resources.

14. Challenges
faced
14
Push back from certain
stakeholders
Firms’ Awareness on
the requirements of
professional standards
(e.g. ISQC 1, ISAs, IFRS
etc)
Allegations of being
impartial and not
objective

15. Key
Initiatives
15
Regulatory function of MIA is
included & stated in the
Accountants Act 1967 and the By-
Laws
Education & awareness sessions
during the Public Practice Programme
& Audit Quality Enhancement
Programme

16. Key
Initiatives
16
Separation of functions (Practice
Review Department, Practice Review
Committee, Investigation Committee,
Disciplinary Committee)
Regular sharing & collaboration on
various projects with other regulatory
bodies (e.g. tax authority, central
bank, AOB)

17. Practice
Review
Reports
17
Practice Review
Annual Report
2020/2021
Practice Review
Annual Report
2019/2020
Practice Review
Report 2018

18. THANK YOU
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