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New accounting policies have been drafted to change the current
accounting system from modified cash basis to accrual basis. These
include general accounting policies, policies on Consolidated
Funds, Assets, Liabilities, Revenue and Expenses and have been
endorsed by the Government Accounting Standards Advisory
Board (GASAC). The Accountant-General’s Department of Malaysia
(JANM) has also carried out 36 awareness programmes to educate
its officers and staff about accrual accounting for Government.
Other initiatives implemented include improvements in tax
administration and compliance to increase tax collection as well
as transparent procurement and expenditure control to reduce
government spending.
Moving Forward
Initiatives to improve tax administration and compliance will
focus on increasing the tax base as well as enhancing audit and
enforcement. These initiatives are expected to generate an
additional RM1.94 billion in revenue in 2012.
The exercise on the review of the Promotion of Investments Act
(PIA) 1986 is currently being carried out to review the variations
and condition/criteria for incentives approved under the Act.
The Ministry of International Trade and Industry is working
together with the Ministry of Finance, the Malaysian Investment
Development Authority (MIDA), Attorney-General’s Chambers,
and the Inland Revenue Board on the review and the amendments
to the Act. It is targeted to be tabled to Parliament in the third
quarter of 2012.
SrI: Public Finance
The enforcement of procurement planning and introduction of
spend analysis for procurement activities will be implemented
with pilot project on these ministries:
• Ministry of Defence
• Ministry of Education
• Ministry of Health
Ministry of Home Affairs
•
The value management initiative will be incorporated in this
initiative to further enhance government’s expenditure control
programme.
The proposed accounting policies which have been endorsed
by GASAC will be tabled to the Accrual Accounting Steering
Committee for approval in 2012. At the same time, the Malaysia
Public Sector Accounting Standards (MPSAS) based on
International Public Sector Accounting Standards will be drafted
and approved in stages in 2012, 2013 and 2014. To enable the
new computer software system design for accrual accounting,
a review of the current business processes of all modules in the
Government Financial Management and Accounting System
(GFMAS) will be carried out and is expected to be completed by
the end of 2012.
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