NEWS AND VIEWS FROM ACCA SINGAPORE/ JULY - SEPTEMBER 2002
Focus July - September 2002 1
Message from John Miller, Head of Singapore and New Market (ASEAN) Development 4
The Official Journal of ACCA Singapore
The Business Times interview with Anthea Rose , Chief Executive 5
ACCA Appoints New Set of Officers 7
The Executive Committee
Don M Ho (President)
Ernest Kan (Vice-President)
SAA Annual Dinner 8
R Jayapal (Honorary Treasurer)
Helen Hee (Honorary Secretary/
News & Views International Assembly)
Why Do Most Multinationals Find Success in China so Elusive? 10
Kaka Singh (Council)
Enron: The Views of ACCA 12
Belinda Young (International Assembly)
Quek Shi Kui (Immediate Past President)
Updates Lim Lian Soon
New Members 16 Ng Song Piak
Events Yim Kam May
ACCA Business Navigator 18 Gerard Teo
ACCA Women’s Interest Group - Launch 19
Noticeboard 435 Orchard Road
Events Calendar 2002 20 #12-03 Wisma Atria
Recruitment Singapore 238877
tel: +65 6734 8110
Technical News fax: +65 6734 2248
The Proposed Improvements to International Accounting Standards 21 e-mail: email@example.com
Malaysia - A Leading Shopping Destination 26
For the latest information visit www.accagobal.com/singapore
2 Focus July - September 2002
John Miller, Head of Singapore and New Market (ASEAN) Development
At the recent Singapore Branch AGM, members were interested in the “Branch Grant” item in the accounts of Seacron Pte Ltd. (the local company
through which these funds are operated). They were concerned that, although the Singapore membership is growing, the grant from ACCA to the
Branch appeared to have been reduced. The corollary of this might be that the Branch would need to charge members more to attend events.
The purpose of this letter is to explain in more detail about the financing of ACCA’s Singapore operations.
The position is that the contribution which is shown in the Seacron accounts is only one part of the financial support provided by ACCA. In addition
to the grant to the Branch, ACCA supports the local office at a total cost of £310,000 (S$775,000) per annum. This is split between:
staff costs £200,000 (S$500,000).
office costs £80,000 (S$200,000)
promotion £30,000 (S$75,000).
The twice yearly graduation ceremonies are organised on a self-financing basis.
In addition, Singapore members receive accounting & business magazine and a full range of web-based services, at a cost of some £75,000
(S$187,500). This means that, altogether, the total direct spending each year for the benefit of Singapore members is some £385,000 (S$962,500)
or just over £100 (S$250) per person.
The remainder of the subscription goes towards the costs of the corporate activities which maintain the standing and reputation of the ACCA
qualification and ensure that members operate to the same consistent high standards throughout the world. ACCA estimates that the cost of this
aspect of its activities is around £100 (S$250) per member.
This means that the £150 currently paid by a member in Singapore is actually somewhat less than the total attributable expenditure (£100 + £100
= £200). In other words, Singapore members are getting more for their subscriptions than they actually pay.
I hope that this information will reassure members that ACCA continues to provide an appropriate level of financial support to ACCA Singapore.
Focus July - September 2002 3
The Business Times Interview with ACCA’s Chief
Executive, Anthea Rose
According to Anthea Rose, chief executive of other clients. You just can’t offer them to your
ACCA, accounting is a lucrative profession. In audit clients,” Ms Rose said.
Singapore, new ACCA members in an audit firm
“Young people still seem to want to come into
typically earn between $2,000 and $2,500 a
this profession – audit is just one facet of the
Even with Enron, membership is expected to go
up this year, said Ms Rose, who was in
Singapore this week. The situation is the same Added John Miller, head of ACCA Singapore
in the world body, founded in 1904 and based responsible for new market (ASEAN)
in London - it expects new members this year development: “In reality, when one graduates,
to exceed last year’s record intake of 56,000 the first route is usually to one of the audit firms
which was itself an increase of 21 per cent over but even then, it does not necessarily deter the
2000. Total ACCA world wide membership is best and the brightest.”
He added: “The people I’ve spoken to said you
Perhaps the current recession has something to either have an aptitude or you don’t. And it still
do with people choosing the profession. is an incredibly lucrative direction to take into
ACCOUNTING STILL AN ATTRACTIVE, Accountants’ employability is generally the profession.”
LUCRATIVE JOB regarded as high as they have skills suited for
Good starting pay, high employability cited as many management jobs.
reasons The Business Times on 15 - 16 June
By Siow Li Sen 2002
To be a full ACCA member requires completing
a minimum 3-year practical or working stint.
You would have thought the Enron/Andersen There is an annual fee of £150 (S$395).
debacle and the continuing reports of companies
misstating or restating their accounts might have
dented the reputation of accountants. But more One of the effects of Enron has been to separate
people are joining the profession. audit and consulting, which some Singapore
accountants argued against because that might
deter the best and brightest from joining the
As of yesterday, the Singapore Branch of The profession as audit is not “sexy”.
Association of Chartered Certified Accountants
(ACCA) has seen an 11 per cent rise in membership
to 4,279 from a year ago. “There is a point that youngsters may find there’s
not enough scope. But I don’t think you should
lose sight of the fact that these services, like
Since 1999, ACCA membership in Singapore has corporate finance, can certainly be offered to
risen some 40 per cent.
4 Focus July - September 2002
Anthea Rose, Chief Executive
EVEN ENRON WON’T CHANGE US ACCOUNTING US accounting standards are legalistic and rules- The Business Times on 15- 16 June
based, encourages those who wish to operate as
US expected to cling to its rule-based standards,
close to the line as possible, or even the test the
says UK accountant
By Siow Li Sen
They enable the exploitation of loopholes and is
US accounting standards may have been discredited seen to devalue professional judgement.
by the collapse of Enron but arrogance in the world’s
richest economy is likely to stymie the effort to make
them more principles-based as in the rest of the “Ideally the US should adopt the international
world, said an industry expert. standards but whether it will is another question
because they always think the American way is
the right way of doing things,” she said.
Many people thought that following the collapse of
Enron which put the spot light on the US rules-
based accounting system, moves to harmonise the “They’ve built up, in a sense, a lot of intellectual
US standards and international accounting capital, in learning how to get around these rules
standards would gain momentum, said Anthea and that’s why in a way, they will be quite
Rose, chief executive of the Association of Chartered reluctant to give them up.
So despite the current spate of financial scandals
that have been uncovered which might be
expected to at least pull the US accounting
“Because the US model is the one that has lost
standards more towards the international
credibility, don’t forget that,” said the London-based
standards Ms Rose is not confident of that
Ms Rose in a recent interview with BT.
“We all thought after Enron this was bound to make
This is despite the fact that the US Financial
the US go the way of the rest of the world and even
Accounting Standards Board has a new
Harvey Pitt, the chairman of the US Securities and
chairman, Robert Herz, who was until recently
Exchange Commission, has talked about principles,”
a board member of the International Accounting
The rest of the accounting world generally adopts
“What I am trying to say is that in the end, I don’t
international accounting standards – and follow
think they will because they are so used to doing
the principle of “substance over form”. By contrast
things, working the system if you like, in this
rules-based environment,” she said.
Focus July - September 2002 5
ACCA has a new set of officers. Jonathan
Beckerlegge, who is a partner in CGA
Accountancy in York has been elected ACCA
New Set of President. Jonathan is the chairman of our Audit
Committee and a long-standing member of
ACCA’s bilateral groups. He also serves on the
Officers Ethics and Working Party of the Federation des
Experts Compatables Europeens (FEE).
The new Deputy President is Sam Wong, an
audit partner with Ernst & Young in Hong Kong.
Sam was the former chairman of ACCA Hong
Kong and has been instrumental in raising the
public profile of ACCA and strengthening its
relationship with the new Hong Kong government
as well as the education and media.
Douglass Kerr, Group Finance Director of CPL
Industries Pte Ltd based in Chesterfield, UK has
been appointed Vice President for ACCA.
Douglas is chairman of ACCA’s Finance
Committee and has worked for British Airways,
CWS Ltd and The Boots Company plc.
6 Focus July - September 2002
SAA Annual Dinner
Focus July - September 2002 7
ACCA Singapore congratulates SAA on another successful year. Below is the speech given by Mr Tan Boen Eng, ICPAS President and SAA
Committee Chairman, given at SAA’s Annual Dinner on Monday, 24 June 2002.
Ladies and Gentlemen,
Good evening and welcome to our SAA Annual Dinner.
The presence of so many SAA lecturers here is a reflection of your personal commitment and interest in assisting the Institute in the development
of future quality accountancy professionals in Singapore.
First of all, I would like to take this opportunity to share with you the success of SAA in the recent years. On the whole, the Academy has
performed well. Based on the January 2002 intake, we saw a significant increase in the student enrolment for ACCA and CAT. The CAT
enrolment for the January intake this year stands at 1,748 compared to 1,279 the same time last year. As for ACCA, the enrolment of over
4,800 this January almost doubled last year’s January intake. The enrolment for ACCA has chartered a steady ascend since 2000, after
enrolment fell during the 1997 economic crisis. The remarkable progress would not have been possible without the effort and hard work of our
trainers and lecturers. And in view of such positive growth in the first half of the year, I urge that we strive even harder to attain and maybe even
surpass the pre-crisis enrolment figure of 9,600 this year.
Being the national body for accountants, we have continued to enhance our position.
I am pleased to announce that in the recent ICPAS/ ACCA Joint Scheme December 2001 examination, SAA students achieved higher pass-rates
in 10 papers out of 16 compared to the Singapore pass-rates. Special congratulations go out to the four SAA students who have attained top
three worldwide placing in the Joint Scheme. They are Lee Sheue Ling, Heng Mei Chuen, Quah Bee Leng and Zhao Yu. Again, due credit for the
good performance of all students should be attributed to all the lecturers of the Academy.
As you may be aware, we recently turned Angsana 4 into a lecture theatre, complete with modern teaching equipment. The theatre has a capacity
of up to 200 students. Some of our lecturers have already had the experience of mass lecturing in that theatre. As for those who have not, this
is an aspiration you can look forward to achieving.
Apart from the improvements made to Angsana 4, the SAA office will be renovated shortly. Members and students will not have to wait long to
be attended to as the new office will be designed in an open concept with all the staff serving the customers. We hope this will translate into a
higher level of customer service, specialisation as well as comfort to our students and members, who are our valued customers.
At this juncture, I take the opportunity to express our appreciation to all who have worked hard over the years and contributed to building the
success and good reputation of the Academy, particularly, the recipients of the Long Service Awards this year. They are Ms Annie, Soh Yeok Hui,
Mr Tan Cher Keow, Dr Ernest Kan and Mr Cheng Wai Fung.
Last but not least, I would like to thank you again for your valuable contribution and assistance in helping the Academy grow from strength to
strength. I wish you a pleasant and enjoyable evening.
8 Focus July - September 2002
Why Do Most Multinationals Find
Success in China so Elusive?
Come to think of it, how many of the
• Dreadfully long receivables
• One of the main reasons for the high multinational companies that you audit in
failure rate among multinationals in China make money? The answer, not • Intensified local competition
China is that they do not possess a surprisingly, is “ Not many”. • Too much slacks in the plants
realistic vision of the market.
• High selling and marketing costs
But why? Most of our multinational clients look • Disconcerted efforts between
• A utopian view of the China market upon China as an important and strategic departments
leads to the formation of unrealistic market, and they try to give it their best people,
• Distribution / transportation always a
expectations by headquarters of what build their best plants, and put in tons of money
will be achieved by the China year after year. So why don’t they succeed?
operations and its management. • Inability to develop local management
Now as auditors and tax advisors you can
• A history of many rounds of overly
• A 1998 study by A T Kearney revealed probably tell me more corporate horror stories
four factors that correlate significantly in China than I can count. But we still have a
to profitable operations in China: job to do here, and that is to try to find the • And lastly, a rotating door for Managing
connections between these apparently Directors in China
You may say, “Well. So where’s the connection?’
Now let’s review some of the key failings that
- Distribution you and I see on and off the balance sheets in
China: The truth is there is one, and the connection is
in the people at the main headquarters who
• A fifth possible success factor is having • Regulations a pain
invariably expect a lot, and the poor Managing
the right leadership in place in China • Negative cash flow director in China who always find that he / she
to exploit all available opportunities. is caught between the fickle and sometimes alien
• High costs of goods
market and a headquarters that is never satisfied.
• Industry over-capacity And all of the above phenomena that you see
• High cost of expatriates are just symptoms of this gap.
• Poor partner relationships
Focus July - September 2002 9
Why Do Most Multinationals Find Success in China so Elusive?
In my ten years of executive search activities I joint venture partners have already formed suggest that the ‘right leader’ in terms of the
have dealt with many clients from the Fortune alliances and are no longer on the market, China market must have most, if not all, of the
500, while they could be American, or European, so to speak. following attributes:
or rest of the world- the one thing they have all
2. Industry: The more profitable industries
in common is that China always looms big on
in China are automotive, chemicals,
their radar screen. And you must have heard • Credibility / trusted by headquarters
financial services, professional services,
this all before, “If just 20 per cent of the 1.2 • Intimate knowledge of the China market
communications and electronics. The less
billion population buys our products once or
profitable ones include pharmaceuticals, • Appropriate vision for the business
twice a year we’d have a US500 million business
consumer goods, industrial products,
in no time…’I am pleased to note that in the • Well-developed interpersonal skills /
distribution and retail. The high investment
last couple of years this kind of emotive assertion ability to mentor, coach and train local
costs in technology and equipment are the
has been toned down somewhat, but you still employees
main reasons why the automotive and
can see my point.
chemical sectors have fewer competitors
and are better positioned to achieve
The credibility attributes is particularly useful
profitability. Conversely, while the
The truth is, China’s wealth is concentrated in in bridging the expectation / reality gap in China.
consumer goods industry has few entry
its cities, not the countryside. And only about And from this angle, of course, an assignee from
barriers, local manufacturers have
20 per cent of the urban dwellers, or roughly 2 within the company may have an advantage.
become increasingly competitive – both in
per cent of the total population, have any sort However if this assignee does not have sufficient
terms of quality and pricing.
of discretionary spending power. So I am told knowledge of or experience in the China market,
by some of the top executives of global 3. Management: For each expatriate while at the same time possessing a valid vision
advertising agencies in China. manager, profitable multinationals have for the business, he / she does not have much of
two or more local managers. Although 70 chance given rapidly evolving market and
per cent of the companies surveyed believe intensification of competition. But even having
However, it is this kind of unreal expectation in localisation, only 12 per cent claim to the first three attributes still does not guarantee
about China revenues that has prompted have achieved their desired ratio. success, as this appointee will need help from
headquarters to build state-of-the-art plants loyal and intelligent local managers who will in
4. Distribution: Companies that improve
(which equals expensive equipment, high cost turn make things happen at the customer end.
customer access by removing distribution
of depreciation and goods), which start inflated The biggest multinational success stories in
bottlenecks tend to be more profitable than
organisations and push unrealistic revenue / China, like GE Plastics or Xian Janssen, have
those that do not do so. Companies in
growth budgets onto the China MD. ongoing staff programmes that develop
China like P&G who remove bottlenecks
employees’ skills and offer them international
tend to prosper and achieve profitability
exposures overseas. Invariably, at the core of
A 1998 study conducted in China by faster than other entities. Moreover, they
the greatest successes, you will find a leader
management consultants A T Kearney found seem to establish solid lead in the race for
who truly cares for employees, whether they
four factors that are highly correlated with market share and brand recognition that
are local or expatriate, and always pushes
profitable operations: is almost impossible to shake.
forward in the pursuit of achievement.
1. Ownership: Wholly Owned Foreign
Enterprises (WOFE) are likely to achieve I would hasten to add that the fifth and perhaps Addy Lee
profitability sooner that joint ventures most important factor is the appointment of the Managing Partner, China
because they have more control over their appointment of the right leader for the China The Amrop Hever Group
operations. Moreover, the most desirable market. My observations over the last 10 years The article was first published in ACCA
Hong Kong’s Perspective magazine.
10 Focus July - September 2002
Enron: The Views
Focus July - September 2002 11
Enron: The Views of ACCA
Rarely, if ever, have the newspapers carried so however, that local solutions should be based Standards and rules which are based on
much coverage – both in reports and on principles which are agreed at the global principles are greatly preferable. ACCA strongly
commentary – on accounting issues, both level. National regulatory and others will need supports Europeans Union moves to adopt
technical and political, than in the immediate to be prepared to give up a measure of ‘control’ International Financial Reporting and Auditing
aftermath of the Enron case. over their domestic activities in return for Standards in the next few years and believes
‘influence’ over global developments. that accounting standard setters and capital
markets worldwide which are not yet committed
Despite the emphasis that has been given to the to those should now address the issue urgently.
role of Andersen in the Enron affair, the This will, for example, require the US capital
problems exposed by the largest bankruptcy in Although the full facts of the Enron collapse markets to commit to the adoption of
US history go much deeper than a possible will not emerge for a long time, it is already international standards in preference to
breakdown in auditor performance. Enron has evident that investors were not properly established US GAAP and GAAS.
triggered an enormously wide-ranging debate informed about the significance of off balance
and has raised questions about many aspects sheet finance arrangements. US accounting
of the operation of capital markets as well as rules may well have contributed to this, in that
concerns about financial reporting and auditing they are concerned with the strict legal Enron, and all the other cases which have
standards, regulatory arrangements and the ownership of investment vehicles rather than attracted attention, have demonstrated the need
quality of the corporate governance in major with their control. By contrast, International for greater transparency and trust. The global
corporations. This article sets out ACCA’s views Accounting Standards follow the principle of financial community should address this as a
on each of these issues. ‘substance over form’ and their use would have matter of urgency. No single measure is likely
resulted in the details of the special purpose to deal with the questions which have been
entities being reported in a transparent way. raised and range of ideas must be considered.
Capital Market Regulation
The collapse of Enron occurred in the capital
market which is not only the largest in the world By specifying precisely where the line is to be ACCA believes that the process of audit
but which considers itself to be the best drawn, legalistic, rules-based standards appointment should be reviewed. Although in
regulated. As a result, all capital markets are in encourage those who wish to operate as close theory this is a matter for stakeholders, in
future likely to have to devote more resources to the line as possible, or even to test the limits. practice the appointment is controlled by
to maintaining the integrity of their investor- They enable the exploitation of loopholes and management. It may be time to see if this can
orientated information. ACCA considers that devalue professional judgement. be changed. It has been suggested that
there should be a mechanism which requires governmental bodies might fulfill the role of
both major corporations and institutional appointing auditors but ACCA believes that such
investors to provide the resources needed to By specifying precisely where the line is to be an approach would be appropriate for global
ensure that the market function properly – drawn, legalistic, rules-based standards capital markets. There might be, however, be
perhaps via an externally administered levy encourage those who wish to operate as close merit in arrangements which permit or require
which confers no influence at the regulatory to the line as possible, or even to test the limits. companies to hand over this task to an
level. And it is clear that new solutions must be They enable the exploitation of loopholes and independent private sector body. In the event,
found to global market problems. These will devalue professional judgement. non-executive directors need to play a much
have to be introduced and controlled at wider role.
individual national level. ACCA argues,
12 Focus July - September 2002
Enron: The Views of ACCA
A range of other options could include: Audit Monitoring the introduction of remuneration schemes which
reward sustainable one-year-one growth in
• Making the appointment of the external Professional bodies must have independent
profitability and shareholder value. The trend
auditors less dependent on the executive investigation and disciplinary procedures and
towards shorter contractual arrangements may
directors and involving the non-executive be seen to act in the public interest. This will
also need to be reviewed.
directors, audit committee and institutional enable them to take firm and transparent action
shareholders; in turn, this would have far against members who fail in their fundamental
reaching implications for the corporate responsibilities, whether as executives or as Non-Executive Directors
governance mechanism auditors.
The Enron audit committee has been critised
• Limitations on the ability of audit firms to for failing to control the apparent exploitation
offer consulting services to listed company of US accounting rules to present a better picture
The UK system of quality control avoids firm-
audit clients (although not necessarily a of performance that was the actual case.
on-firm review and instead utilises, through
ban on the provision of such services to Consideration needs to be given to the time
professional bodies, permanent monitoring staff,
non-audit clients) commitment and effort which is required from
who are not connected with individual
non-executive directors whose role is look after
• Fuller disclosure of audit and consulting accounting firms. This sort of system, which
the interests of the investors and other
fees in the annual report and accounts can both operate on a national basis and cover
shareholders they are there to represent. They
transnational audit firms, is demonstrably more
• A mandatory review by a company’s audit should bring to their role a balance of experience
effective and independent than the widely used
committee of the independent status of the and new thinking, some real understanding of
and much criticised system of ’peer review’.
external auditors and the publication of a the sector in which a company is operating and
statement that if it satisfied with the results the ability to make a strategic contribution. And
Executive Remuneration and Sustainable this requires that they are available for
• A prohibition on audit firms providing
Wealth Creation meaningful amounts of time.
audit services in instances where audit staff
have moved to senior executive roles in The concept of payment for performance is
client companies: this could take the form widely accepted. When, however, it is applied
The independent of non-executives is another
of a moratorium prohibiting auditors from to the remuneration of senior executives, it may
critical issue – much commented on by
moving to audit clients for an appropriate do more than simply encourage good
corporate governance lobby organisations.
period after they have been personally performance. It may also incentivise short term
There are obvious weaknesses in a system where
involved with the audit. and self-motivated decisions which are not in
former executive directors can become non-
long-term interests of investors.
executive directors and so in the position of
There is also the issue of the size of the audit fee exercising an accountability function in relation
relative to the local office which is providing the Investors will be better served if performance to former colleagues.
service and the fee generation target(s) set for related compensation is linked to the longer-
the engagement partner. While this cannot be term generation of corporate wealth. There is
ACCA believes that what is needed urgently is a
dealt with by prescriptive regulation, audit an obvious conflict between, on the one hand,
code of corporate governance which is capable
monitoring should focus on the culture within the pressures of increasingly frequent interim
of global acceptance. Such a code should build
audit practices and the pressures on the culture reporting and one year service contracts and,
on initiatives which have occurred in several
within audit practices and the pressures on on the other, the need to deliver sustainable
jurisdictions. Examples of such initiatives
individual engagement partners. investor returns. This might be addressed by
include the OECD Principles of Corporate
Focus July - September 2002 13
Enron: The Views of ACCA
Governance and the World Bank-driven Global • Auditor independence issues should be This article is an extract from the
Corporate Governance Forum. We strongly urge revisited and the relationship between a commentary “Enron: Comments from
the promoters of such initiatives to join forces reporting entity and its professional ACCA”, which is posted on the ACCA web
with market regulators – such as IOSCO – and advisers should become more site. To read the implications of the Enron
other global organisations such as the transparent case in full, please refer to
international Federation of Accountants – to www.accaglobal.com
develop and promote compliance with a global
governance code. • There should be a review of the regimes
for monitoring practice in auditing,
financial reporting and corporate
Wider Disclosure and Accountability
Despite all that has been written and done in
recent years, ACCA believes that there is still
considerable room for further development of Enron should be the catalyst for improvements
corporate governance practice and reporting. in a range of areas affecting company reporting
Indeed, there is a need for investor information and governance.
beyond the narrow confines of financial
statements. Disclosure of corporate governance
performance is increasingly relevant to
investors, who are right to demand plain
language reporting of matters of significance.
ACCA champions the extension of significance.
ACCA champions the extension of corporate
reporting to the wider economic, social and
environmental aspects of a business; investors
and other stakeholders are entitled to know how
a business responds to the wide range of risks
Our Key Suggestions
In summary, therefore, ACCA suggests that:
• Global financial markets need a global set
of principles-based financial reporting
standards and a global code of corporate
• The objectives of financial reporting
practice should be expanded to recognise
the growing level of concern arising from
the globalisation of business
14 Focus July - September 2002
New Members April - May Congratulations and Welcome from ACCA Singapore
to all of our New Members!
2002 April 2002
0027698 Miss Ananthi A/P A Krishnan
0034907 Miss Koh Puay Hoon
0035864 Miss L Neo Wee Feh
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Focus July - September 2002 15
New Members April - May 2002
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0453204 Miss T J T @ Tan Lee Poh May 2002 0016700 Miss J Mahadevan
0461968 Miss Chua Soon Hwa 1808683 Miss Tan Bee Len 0028000 Miss Chuo Hung
0463999 Ms Zhao Wei 1963854 Miss Kong Keh Le 0031205 Mr Lim Boon Seng Vincent
0465021 Miss S T Tham 1999483 Mr Gan Tiong Hwee 0033519 Miss Chin Mei San Lilian
0525961 Ms Liu Yi 2070644 Miss Wat Pei Sung 0035897 Miss Loh Mui Eng
0527367 Ms Lan Rong Di 2083824 Miss Loo Li Ching 0047022 Miss Khoo Kar Boey
0565047 Ms Zhang Xiao Hui 2170048 Mr Ong Choon Kong 0068811 Miss C Goh Yen Ling
0618906 Miss Thong Jia Huey 2400426 Mrs S Devi Paraniruva Singhan 0075404 Mr Ang Kah Boon
0654104 Mr K Foo Yuen Chuan 2417043 Miss J See Yuat Ching 0080185 Miss Chou Wee Lin
0656635 Mr Wong Yi Jack 2435040 Miss Cheing Siou Fan 0080623 Miss A Tan Yin Yin
0838049 Mr Z Ali 2591635 Miss Tsen Ket Tzu 0080623 Miss Ong Wei Wei
1306730 Mr Goh Han Loo 2592638 Miss Low Tao WeySharon 0082090 Mr Chong Boon Moo
1821944 Mr Leong Yew Kai 2615067 Mr C S Leow 0084121 Mr Fong Chung Hwa
1825563 Mr Tan Hau Huat 2627480 Miss I Hwan Siew Khim 0085671 Ms S Phua I Chiang
1990505 Miss Foo Yoke Keow 2711420 Mr Lim Yee Chuan
2070837 Miss T Ong Lai Moh 0177572 Miss Liw Oi Yew
2080357 Miss Pang Seng Poh 0177594 Mr Yan Naing Aung
2140250 Miss Pang Sow Huan 0252238 Miss Tai Soak Hui
2169484 Mr Yap Koon Sing 0257750 Miss Wong Onn Yee
2240062 Miss Aw Yeong Yuen Kuan 0300941 Miss Ni Chun Hua
2240299 Miss Neo Chin Ling 0628936 Miss Woo Wei Ling
2292372 Miss R S Thanalachimi 0331739 Mr Low See Kiong
2302509 Mrs Wong Siew Lan 1325957 Miss Yeo Siew Kwan
16 Focus July - September 2002
ACCA Business Navigator
With the impending audit exemption policy, practitioners will need to reinvent themselves and their practices to meet tomorrow’s challenges. Clients will want
advisers who go beyond providing financial statements (and associated compliance work). They will look for advisers who can add real value to traditional
To assist its Members in taking on this new role and responsibility, ACCA has developed a unique “assurance” product. The ACCA Business Navigator package
is designed to help and guide practitioners through the process of delivering value-added services to new and existing clients. It contains tools to enable
practitioners to build on core competence in order to offer a wide range of performance measurement and risk analysis services.
ACCA Singapore held two introductory sessions for Members in June. The introductory session was conducted by Glenn Collins, ACCA’s Technical Adviser based
in the UK. (Picture above)
Members will be adviced shortly of the date of the Business Navigator Courses.
Focus July - September 2002 17
ACCA Women’s Interest Group - Launch
Our Women’s Interest Group was officially launched on 22 June with a half day conference. Over 50 Members/Affiliates attended the session. The group mission,
to raise the profile of ACCA women both professionally and personally, leading to the larger purpose of increasing the profile of ACCA as a whole.
Chairwoman Sylvia Khoo, FCCA, gave the opening address and also encouraged Members/Affiliates to partake in future activities.
Jocelyn Lim, FCCA, Co-Founder and Director of Professional Investment Advisory Services (PIAS) gave the audience a better understanding on planning their
personal finances and the pitfalls to avoid. Lee Soh Hong, FCCA, Founder of CancerStory.com, a portal dedicated to cancer patients, is fully committed to charity
and volunteer work and was asked to speak to provide inspiration to others. Guest speakers from The British Council also presented and provided tips on creative
thinking and communicating with different behaviour types.
The group intends to grow and provide opportunities for women to network with one another at special women events as well as network with other local women
associations. So do stay tuned for the line-up in future issues of Focus and direct mailers.
18 Focus July - September 2002
Events Calendar Recruitment
Members’ Dinner Talk Other Events PART -TIME / FULL-TIME TEACHING
POSITIONS FOR CAT / ACCA
25 July 2002, Thursday 23 July 2002, Tuesday
The role of the CFO in enhancing Environmental Reporting Award (ERA)
WANTED: Suitably-qualified lecturers to
shareholders’ wealth - the “Comfort” – Press Conference Launch
teach preparatory coursework for
experience, By Mr Peter Leong examinations leading to the CAT levels A,
26 - 27 July 2002, Friday - Saturday B and C as well as the ACCA parts 1, 2
21 November 2002, Thursday How to Start and Run Your Own and 3.
Preference would be given to those with
By 3R Holdings Pte Ltd
Members’ Soft Skills Seminars prior teaching experience and a track
record of students with good results under
24 October 2002, Thursday their charge. Part-time as well asf ull-time
17 August 2002, Saturday
ACCA 5th Annual Conference positions are available. Lecture fees are
Business Writing to Make You Look competitive and will commensurate with
Good, By The British Council Corporate Sustainability - Moving
Towards Sustainable Business
Practices If interested, please email your full CV to
October / November 2002, Saturday firstname.lastname@example.org by 31th July and
Time/ Stress Management indicate the course/s and levels you are
14 November 2002, Thursday
able to teach.
Graduation, for Students of June 2002
Guest of Honour, ACCA Vice President
Mr Sam Wong, FCCA
2 August 2002, Friday
The Accountant as Business Advisor
8 November 2002, Friday
Series (Part I)
11 October 2002, Friday
The Accountant as Business Advisor
Series (Part II)
Graduates Career Talk
6 September 2002, Friday
Focus July - September 2002 19
The Proposed Improvements to
Contributed by Thomas Egan, Senior Technical Manager
The International Accounting Standards Board
Deloitte & Touche - Singapore
(IASB) has issued a 404-page exposure draft
on proposed changes to the existing standards
to promote convergence with the US and other
jurisdiction in order to establish a globally
accepted set of accounting standards. The
Institute of Certified Public Accountants of
Singapore intends to issue a very similar
exposure draft, which should have taken place
by the time this article is published. These
exposure drafts propose removing options in
the standards in order to improve consistency
and in addition withdraw IAS 15 (SAS 37),
Information Reflecting the Effect of Changing
The entire exposure draft may be downloaded
from the IASB website at www.iasb.org.uk and
the ICPAS exposure draft would be available
for download at www.icpas.com.sg. While these
are proposals at this point, they have been
discussed by the IASB, so they will likely become
part of the standards in the relatively near future.
Highlights of Major Changes
IAS 1 (SAS 1) Presentation of Financial
• amend the basis for exemption from
disclosing particular items of comparative
information from “impracticability” to
“causing undue cost or effort”.
20 Focus July - September 2002
The Proposed Improvements to the International Accounting Standards
• only allow an entity to use a liquidity presentation of assets and liabilities, instead of a current/non-current presentation, when a liquidity
presentation provides more relevant and reliable information.
• specify that a long-term financial liability that is payable on demand because the entity breached a condition of its loan agreement should be
classified as current at the balance sheet date even if the lender has agreed after the balance sheet date, and before the financial statements
are authorised for issue, not to demand payment as a consequence of the breach.
• removal of the following disclosures:
- the results of operating activities, as a line item on the face of the income statement.
- an entity’s country of incorporation and the address of its registered office and
- the number of an entity’s employees.
• require disclosure of the judgments made by management in applying the accounting policies that have the most significant effect on the
amounts of items recognised in the financial statements. For example, management makes judgments in determining whether financial assets
are held-to-maturity investments.
• require disclosure of key assumptions about the future, and other sources of measurement uncertainty, that have a significant risk of causing
a material adjustment to the carrying amounts of assets and liabilities within the next financial year. The nature and extent of the information
provided vary according to the nature of the assumption and other circumstances. Examples of the types of disclosures made are:
(a) the nature of the assumption or other measurement uncertainty;
(b) the sensitivity of carrying amounts to the methods, assumptions and estimates underlying their calculation, including the reasons for the
(c) the expected resolution of an uncertainty and the range of reasonably possible outcomes within the next financial year in respect of the
carrying amounts of the assets and liabilities affected; and
(d) an explanation of changes made to past assumptions concerning those assets and liabilities, if the uncertainty remains unresolved.
IAS 8 (SAS 8) Net Profit or Loss for the Period, Fundamental Errors and Changes in Accounting Policies
• remove the distinction between fundamental errors (errors of such significance that financial statements are not valid) and other material
• remove the allowed alternative treatment of corrections of errors, which allows adjustments to income.
• amend the standard so that when accounting retrospectively for a correction of an error, the basis for exemption from restating comparative
information for a particular prior period changes from “impracticability” to “undue cost or effort”.
• require, rather than encourage, disclosure of the nature of a future change in an accounting policy when an entity has yet to implement a new
Standard that has been issued but not yet come into effect. In addition, disclosure would be required of the planned date of adoption, and an
estimate of the effect of the change on the entity’s financial position unless making such an estimate requires undue cost or effort.
IAS 16 (SAS 14) Property, Plant and Equipment
• clarify that the requirement to review “periodically” the useful life and depreciation method of an item of property, plant and equipment means
that such reviews must occur at least at each financial year end.
Focus July - September 2002 21
The Proposed Improvements to the International Accounting Standards
• include guidance that depreciation of an item of property, plant and equipment does not cease when it becomes temporarily idle or is retired
from active use and held for disposal.
• require disclosure of the following for items of property, plant and equipment stated at revalued amounts:
• When items of property, plant and equipment are stated at revalued amounts the following should shall be disclosed:
(a) the basis used to revalue the assets;
(b) the effective date of the revaluation;
(c) whether an independent valuer was involved;
(d) the methods and significant assumptions applied in estimating the assets’ fair values;
(e) the extent to which the assets’ fair values were determined directly by reference to observable prices in an active market or recent
market transactions on arm’s length terms or were estimated using other valuation techniques;
(f) for each revalued class of property, plant and equipment, the carrying amount that would have been recognised had the assets been
carried under the benchmark treatment; and
(g) the revaluation surplus, indicating the movement for the period and any restrictions on the distribution of the balance to shareholders.
IAS 17 (SAS 15) Leases
• clarifies that when a single lease covers both land and buildings, the lease shall be split into two elements. The land element is generally
classified as an operating lease under IAS 17.11 (SAS 15.11). The buildings element is classified as an operating or finance lease by applying
the criteria of IAS 17 (SAS 15). However, the definition of investment property in IAS 40 (ED/SAS 40) is being amended so that property rights
held under an operating lease can qualify as investment property if the other conditions for investment property are met and the lessee’s policy
is to account for investment property using the fair value model.
• eliminate the choice of how a lessor accounts for initial direct costs incurred in negotiating a lease by requiring that such costs that are
incremental and directly attributable to the lease be capitalised and allocated over the lease term.
IAS 21 (SAS 20) The Effects of Changes in Foreign Exchange Rates
• replace the notion of ‘reporting currency’ in the standard with two notions: Functional Currency (the currency in which the entity measures
the items in its financial statements) and Presentation Currency (the currency in which the entity presents its financial statements).
• revise the section of the standard on distinguishing between foreign operations that are integral to the operations of the reporting entity
(referred to below as ‘integral foreign operations’) and foreign entities, to become part of the indicators of what is an entity’s functional
currency. As a result:
- there is no distinction between integral foreign operations and foreign entities. Rather, an entity that was previously classified as an integral
foreign operation will have the same functional currency as the reporting entity.
- only one translation method is needed for foreign operations—namely that previously described in IAS 21.30 (SAS 20.30) as applying to
• remove the allowed alternative treatment in IAS 21.21 (SAS 20.21) that allows certain exchange differences to be capitalised.
• include a new requirement that a change in functional currency is accounted for prospectively.
22 Focus July - September 2002
The Proposed Improvements to the International Accounting Standards
IAS 24 (SAS 21) Related Party Disclosures
• add the following parties to the definition of ‘related party’ - post-employment benefit plans for the benefit of employees of the entity, or
of any entity that is a related party of the entity.
• add a definition of ‘close members of the family of an individual’.
• add guidance to indicate that two venturers are not related parties simply because they share joint control over a joint settlement of
liabilities on behalf of the entity or by the entity on behalf of another party.
IAS 27 (SAS 26) Consolidated Financial Statements and Accounting for Investments in Subsidiaries
• modify the exemption from preparing consolidated financial statements to indicate that a parent need not present consolidated financial
statements to comply with IAS (SAS) if and only if:
(a) it is a wholly-owned subsidiary or the owners of the minority interests, including those not otherwise entitled to vote, unanimously
agree that the parent need not present consolidated financial statements;
(b) its securities are not publicly traded;
(c) it is not in the process of issuing securities in public securities markets; and
(d) the immediate or ultimate parent publishes consolidated financial statements that comply with IAS (SAS).
(e) change the criterion for exclusion from the scope of consolidation when control is intended to be temporary from “in the near future”
to “within twelve months”.
(f) require minority interests to be presented in the consolidated balance sheet within equity, separately from the parent shareholders’
IAS 28 (SAS 27) Accounting for Investments in Associates
• exclude from the scope of IAS 28 (SAS 27) and IAS 31 (SAS 29), Financial Reporting of Interests in Joint Ventures, investments that
would otherwise be associates or joint ventures held by venture capital organisations, mutual funds, unit trusts and similar entities that
are measured at fair value in accordance with IAS 39 (SAS 33), Financial Instruments: Recognition and Measurement, when such
measurement is well-established practice in those industries.
IAS 40 (SAS ED/SAS 40) Investment Property
• amend the definition of investment property to permit a property interest held by a lessee under an operating lease to qualify as
investment property provided that:
(a) the rest of the definition of investment property is met; and
(b) the lessee uses the fair value model set out in IAS 40 (ED/SAS 40).
Focus July - September 2002 23
The Proposed Improvements to the International Accounting Standards
• require a lessee that classifies a property interest held under an operating lease as investment property to account for the lease as if it were
a finance lease.
Further Changes are on the Way
While these changes are significant and may require substantial effort for some enterprises to comply with these requirements if adopted, future
changes that are currently being considered by the IASB and should be exposed later this year or early next year will be even more extensive. One
project, Business Combinations, is intended to completely revise IAS 22, Business Combinations and make major changes to IAS 36 (SAS 36,
Impairment of Assets ad IAS 38 (SAS 34) Intangible Assets. The current discussions indicate that the IASB would adopt the US approach whereby
goodwill is recognized as an asset, but impaired, not amortised. A second project, Share- based Compensation, is likely to result in a standard that
will require the recognition of an expense for share based compensation. Finally, a third project on Financial Instruments will propose substantial
revisions and improvements to IAS 32 (SAS 32) and IAS 39 (SAS 33), including clearer guidance on the consolidation of special purpose entities.
For details on these and all IASB initiatives, the Deloitte Touche Tohmatsu website – IASPlus – at www.iasplus.com provides current, complete details
on the activities of the IASB. The website tracks daily events effecting financial reporting and includes quarterly updates of IAS related activities by
country, including Singapore.
24 Focus July - September 2002
Malaysia - A Leading Shopping Destination
Malaysia can really be considered a choice holiday destination, offering something for everyone. From crystal blue waters with sandy beaches to
national parks to superb cuisine, Malaysia offers it all.
For shopping enthusiasts, Malaysia also enjoys three mega sales a year in March, August and December. Each month long sale invites shoppers to
do more than shop. There are fun-filled activities for the whole family and contests offering fantastic redemptions and great prizes to be won. Without
exception, the up-coming August Malaysia Mega Sale Carnival 2002 will see the introduction of the MasterCard Millionaire Shopper promotion, a run
of two major contests and redemption promotions to be held at various shopping malls and outlets nationwide, beginning August. It will carry on to
encompass the December Malaysia Mega Sale Carnival at the end of the year.
The Mega Sale Carnival means abundance of bargains and discounts on a wide range of good quality and selected products, concessions on room
rates, discounts on food and drinks and attractive offers on holiday packages to suit every budget. The variety of goods available during the sale range
from sophisticated hi-tech equipment and haute couture to cosmetics and unique knick-knacks. The upcoming August Mega Sale Carnival offers one
of the biggest prize money for a Mega Sale contest thus far. A Grand Prize of
RM 1, 000, 000 will be up for grabs. So what are you waiting for! Enjoy beautiful Malaysia and try your luck at being a Millionaire.
In the Millionaire Shopper Contest, participants are required to rank
seventeen shopping malls listed in the entry form in order of preference.
The Grand Prize of RM 1, 000, 000 will be awarded to the participant
whose ranking order of the pre-selected 17 malls matches the final
line-up as decided by a random draw. The participant whose ranking
order is closest to the final popular line-up wins RM 50, 000, followed
by the next nearest match winning the Second Prize of RM 30, 000
and the third RM 20, 000. If there is more than one winner, the prize
will be given to the entry with the highest spending receipt and in the
case of a tie, the earliest entry received wins. As an added bonus, the
merchants from whom the winning participants have made the
purchases will receive RM 5,000 each.
For further details on other destinations and attractions in Malaysia, call:
Malaysia Tourism Promotion Board #01-01, 80 Robinson Road Singapore 068898
tel: +65 6532 6321 fax: +65 6535 6650 www.tourismmalaysia.gov.my
Focus July - September 2002 25
The Association of Chartered Certified Accountants
ACCA Singapore, 435 Orchard Road, #12-03 Wisma Atria, Singapore 238877
tel: +65 6734 8110 fax: +65 6734 2248 www.accaglobal.com/singapore
26 Focus July - September 2002