BY-LAWS OF

THE MALAYSIAN INSTITUTE OF ACCOUNTANTS

(GROUP 4)
PREPARED BY:
1
.

CHIA SU LI

CEA1100
13

2
.

BEH YUEN JUN

CEA1200
11

3
.

FOO JIA YI

CEA1200
19

4
,

JACQUELINE HII RU WEI

CEA1201
16

SECTION 240

FEES AND OTHER TYPES OF REMUNERATION

Fees

Referral Fees or
Commissions

240.1 Level of fees quoted

may affect profession of an
accountant

240.5 Receiving referral

fees by directing client to
other expert

240.2 Safeguards applied to

eliminate the existence and
significance of the threats or
reduce it to an acceptable
level

240.6 Payment of referral

fees to secure client

240.2A Factor to evaluate

240.7 Threats evaluation

and apply safeguards when
necessary
240.8 Purchase of whole
or partly of another entity

CONTINGENT FEE

240.3 Factors influence threat of contingent fees in creating self-interest.

(a) The nature of the engagement
(b) The range of possible fee amounts
(c) The basis for determining the fee
(d) Whether the outcome or result is reviewed by independent third party

240.4 Safeguards applied to eliminate or reduce the threat to acceptable levels.

(a) Advance written agreement with the client as to the basis of remuneration
(b) Disclosure to intended users of the work performed and the basis of remuneration
(c) Quality control policies and procedures
(d) Review by an objective third party of the work performed.

290.127-290.133
FAMILY AND PERSONAL RELATIONSHIP
relationship

crea
te

Member of the
audit team

Director/ officer/
employee(depending on
roles) of the audit client

Self-interest, familiarity, intimidation threats

Factors
Individuals
responsibilities on
the audit team

Factors

The role of the family

member in the client
company

The closeness of the

relationship

290.128-290.131

(i) Close family member

(ii) Immediate family member

Immediate relatives by blood or
marriage such as:
Sister-in law, brother-in-law,
niece,nephew,aunts,uncle

(iii)The individual is not the

immediate and close family member
(friends)

When the individual (I,ii,iii) is :

(a) director/ officer of the audit client
(b)Employee in a position to exert
influences over the preparation of
accounting records and financial
statement on which the firm will
express their opinion.

Factors of the threats:

(a) The position held by the individual
(I,ii,iii) in the client company
(b)The role of the professional on the
audit team
(c) The nature of the relationship
between individual and audit team
Safeguards:
(a) Structuring the responsibilties of
the audit team
(b)Removing the individual from the
audit team

290.132&290.133
Relationship
Cause threats
Partner is not a
member in audit
team

Director/
ip e
h
s
employee
tion rdanc
a
l
e
o
cc
er
f th l t i n a n d
o
a
re
su
Awa ll con olicies
a
*Sh firm p .
s
h
wit edure
c
pro
Significant factor

Factors that affect independence:

Same as 290.127-290.131

When an inadvertent violation of this section

as it relates to the family and personal
relationship happens, it is deemed not to
compromise independence if:
(i) The firm established the policies and
procedures that required prompt notification
about any breaches.

(ii) The relevant professional is removed

from the team.

Evaluate threat

Safeguards:
(a) Structuring the partners or
employees responsibilities to reduce any
potential
influence over the audit engagement
(b) professional accountant review the
audit work

Safeguards to reduce threats:

(a) Having a professional accountant review
the work
(b)Excluding the relevant professional from
any significant decision-making