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(Sec Update) The Amended Occupational Safety and Health Act

(Sec Update) The Amended Occupational Safety and Health Act
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(Sec Update) The Amended Occupational Safety and Health Act

The Minister of Human Resources in exercise of the powers conferred by subsection 1(2) of the Occupational Safety and Health (Amendment) Act 2022 – Act A1648 and subsection 1(2) of the Factories and Machinery (Repeal) Act 2022 – Act 835, appoints 1st June 2024 as the date on which the Act A1648 and Act 835 comes into operation.

The Act A1648 and Act 835 will affect all organizations (exemption is given to domestic workers, the Malaysian army, and workers on board ships) regardless of risk level and nature of business. With effect from 1st June 2024, some provisions under the Factories and Machinery Act 1967 (FMA 1967) [Act 139] will be migrated as new regulations under the Occupational Safety and Health (OSHA 1994) [Act 514].

We set out below the key changes under the Amended OSHA as below

Implementation and Scope:

Effective Date

The new amendments, Acts A1648 and Act 835, will be enforced starting 1st June 2024.

Affected Legislation

Provisions from the Factories and Machinery Act 1967 are integrated into the Occupational Safety and Health Act 1994.

Coverage

The updated legislation applies to all workplaces across Malaysia, including public services and statutory authorities, but excludes domestic workers, the Malaysian army, and maritime workers.

New Regulations and Provisions

Risk Assessments and Emergency Procedures

Employers are required to conduct thorough risk assessments and develop procedures to handle emergencies at the workplace.

Principal's Responsibilities

A new duty for principals to ensure the safety of contractors and subcontractors, emphasizing the safety of workers under their directive control.

Workers' Safety Rights

Workers now have the right to remove themselves from situations of imminent danger without repercussions.

Occupational Health Services

Mandatory health services and the designation of an OSH Coordinator in organizations with five or more employees.

Training and Licensing

Specific training is mandated for certain classes of persons, along with integrity and licensing requirements for machinery.

Penalties

The penalty structure is revised with significant increases, including fines up to RM500,000 and/or imprisonment for severe violations.

Appointment of occupational safety and health coordinator

The new provision mandates that employers who operate workplaces not specifically classified under existing regulations, and who have five or more employees, must appoint an Occupational Safety and Health Coordinator (OSH Coordinator).

The primary responsibility of the OSH Coordinator is to manage and coordinate safety and health issues at the workplace. This role is distinct from that of a Safety and Health Officer (SHO), who is tasked with ensuring compliance with the Occupational Safety and Health Act (OSHA) and its regulations across different workplaces.

Specific Regulatory Updates

Plant Certification and Licensing

New regulations under the Occupational Safety and Health (Plant Requiring Certificate of Fitness) Regulations 2024 and the Occupational Safety and Health (Licensed Person) Order 2024 detail requirements for plant operations and certifications.

Director and Officer Liability

Directors and specified office bearers are made jointly and severally liable for safety breaches, with provisions for defense in cases of unknowing violations.

Enhanced Notification and Inspection

Notification Requirements

Expanded obligations for reporting the usage of workplace premises and activities, focusing on proactive enforcement.

Certification of Fitness

Stringent standards for the certification and inspection of plants, ensuring their operational safety and compliance.

Overall Impact

These amendments aim to enhance workplace safety across all sectors in Malaysia, increasing accountability, broadening the scope of coverage, and reinforcing the regulatory framework for occupational safety and health. The increased penalties and comprehensive coverage intend to foster a safer working environment nationwide.

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The Role of Company Secretaries on Money Laundering

The Role of Company Secretaries on Money Laundering

Company Secretaries stand at the forefront of efforts to combat money laundering and terrorism financing. As key figures within organizations, their responsibilities extend to implementing preventive measures outlined in regulatory frameworks like the Anti-Money Laundering Act. In this article, we'll explore the pivotal role company secretaries play in safeguarding financial systems against illicit activities and the essential steps they must take to mitigate risks effectively.

Understanding Money Laundering:

Money laundering is a complex process where cash obtained from illegal activities is integrated into the financial system to make it appear legitimate. This process involves three key stages:

Placement

This is the initial stage where cash proceeds from illegal activities are physically placed into the financial system. This could involve depositing cash into bank accounts or using it to purchase assets.

Layering

The illegally obtained funds are moved through a series of transactions to obscure their origin. This could involve transferring funds between accounts, converting them into different currencies, or making complex financial transactions to create layers of complexity. Until the funds look clean and from legal sources.

Integration

The final stage involves integrating the laundered funds back into the economy in such a way that they appear to be from a legitimate source. This could involve investing in businesses, purchasing real estate, or making other high-value transactions.

Company Secretaries as Reporting Institutions:

Company Secretaries play a crucial role in preventing money laundering activities. Under Part IV of the Anti-Money Laundering, Anti-Terrorism Financing and Proceeds of Unlawful Activities Act (AMLA), Company Secretaries are considered Reporting Institutions (RIs) and have obligations both as individuals and at the firm level to combat or prevent money laundering activities.

Preventive Measures Taken by RIs:

To prevent their institutions from being used for money laundering or terrorism financing, RIs must undertake various preventive measures, including:

Risk Assessments

Conduct thorough assessments of the risks associated with their clients, products/services, geographical locations, and delivery channels.

Customer Due Diligence (CDD)

Verifying the identity of clients using reliable and independent sources and conducting enhanced due diligence for higher-risk clients.

Screening Against Sanctions Lists

Checking client names against relevant sanctions lists to prevent dealings with individuals or entities involved in terrorism or proliferation activities.

Submitting Suspicious Transaction Reports (STRs)

Reporting any suspicious activities to the appropriate authorities, such as Bank Negara Malaysia (BNM).

Record Keeping

Maintaining records of transactions, KYC information, and analysis of STRs for at least seven years.

Keeping Information Updated: Regularly updating client information and conducting ongoing monitoring for any suspicious activities.

Furthermore, company secretaries must adopt a Risk-Based Approach (RBA) to identify, assess, and mitigate money laundering and terrorism financing risks. This involves documenting risk assessments, considering relevant risk factors, and keeping assessments up-to-date through periodic reviews.

In conclusion, Company Secretaries play a crucial role in combating money laundering and terrorism financing by implementing robust preventive measures, conducting thorough due diligence, and adhering to regulatory requirements outlined in the AMLA. By taking a proactive approach to risk management, they contribute to maintaining the integrity of the financial system and preventing illicit activities.

PS : Authored by Mr Syazwan, our THK secretary associate, in his personal LinkedIn.

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Role of Company Secretary Under The AMLD Malaysia

Role of Company Secretary Under The AMLD Malaysia
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(Sec update) Role of Company Secretary Under the AMLD Malaysia

What is the Role of the Company Secretary’s play as a reporting institution under the Anti-money Laundering, Anti-terrorism Financing and proceeds of Unlawful Activities Act 2001 (AMLA)?

What is Malaysian AMLA regime?

Before we determine our role, we should understand the meaning of money laundering. Money laundering is a process of converting cash, funds or property derived from criminal activities to give it a legitimate appearance. It is a process to clean ‘dirty’ money to disguise its criminal origin.

How about terrorism financing? It is an act of providing financial support to terrorists or terrorist organisations to enable them to carry out terrorist acts or to benefit any terrorist or terrorist organisation.

Like many other countries, Malaysia government is highly concerned about this area, where money laundering, terrorism financing and proliferation financing pose a significant challenge to the financial system and the overall business sector.

What is The Role of Company Secretary Under AML

Company secretaries are required to comply with Bank Negara Malaysia’s (BNM) Anti-Money Laundering, Countering Financing of Terrorism and Targeted Financial Sanctions for Designated Non-Financial businesses and professions & non-Bank financial institutions policy documents (BNM Policy Document).

Company secretaries are appointed as one of the reporting institutions by Bank Negara Malaysia (BNM), they are playing an important role in this area.

They are required to take the necessary steps to prevent Money laundering / Terrorism Financing and have a system to report suspected transactions to the Financial Intelligence and Enforcement Department (FIED).

Company secretaries have to carry out the following measures to prevent Money Laundering / Terrorism Financing :

  • Compliance with laws

  • Cooperation with law enforcement agencies

  • Establishing internal Control

  • Risk-based approach

  • Customer Due Diligence

A Company Secretary is mandated to conduct CDD on customers when establishing business relations by overseeing transactions. To identify and verify the customer’s identity using reliable, independent source documents, data or information such as identification card.

Additionally, it is crucial to verify the authorization of any person acting on behalf of the customer and confirm their identity. The company secretary must ensure the beneficial ownership’s identity by using reliable information to ensure confidence in their identification.

AMLA Reporting Entity

There are many appointed Reporting Institutions, both in the financial and non-financial sectors.

For examples:

  • Financial Intermediaries,

  • Lawyers,

  • Accountants,

  • Registered Estate Agents, and etc.

All appointed reporting Institutions to work hand in hand with the Malaysian Government and Bank Negara Malaysia to prevent money laundering and terrorism financing, contributing to Malaysia’s brighter future.

 

PS : Authored by Hui Ting, our secretary associate in THK, in her personal LinkedIn post

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What Directors Should Do After Incorporation

What Directors Should Do After Incorporation
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(Sec update) What Directors Should Do After Incorporation

Embarking on the corporate journey in Malaysia involves more than just the initial setup. Directors play a crucial role in steering the company through ongoing responsibilities.

This article outlines key post-incorporation tasks, including filing Annual Returns, submitting Financial Statements, and managing Tax Returns to LHDN. Adhering to these deadlines is essential to avoid penalties and ensure regulatory compliance.

Join us as we explore the vital steps directors must take after incorporation for sustained success in the Malaysian business landscape.

Annual Return

According to the Companies Act 2016 in Malaysia, the Annual Return is a statutory document that companies need to file with the Companies Commission of Malaysia (SSM). This document allows companies to update and confirm their registered information with the SSM, including details about shareholders, directors, registered office address, share capital, and financial position.

Typically, the Company Secretary will prepare the Annual Return for the Director's review, approved via the Directors' Written Resolution. Once approved, the Company Secretary will submit the Annual Return (Section 68) via MBRS.

Companies are required to file the Annual Return within 30 days from the anniversary of their incorporation date.

Financial Statement

The board of directors must ensure that the company's financial statement is submitted within the specified deadline to SSM. The board oversees the financial reporting process, ensuring that management fulfills its responsibilities in preparing accurate and reliable financial statements. After the management account is ready, an approved auditor audits the report to provide assurance in accordance with relevant auditing standards.

The auditor expresses an opinion on whether the financial statements present a true and fair view of the company's financial position, results of operations, and cash flows. This opinion is crucial for stakeholders such as bankers, shareholders, employees, and creditors.

Once the audited report is ready, the director circulates it within 6 months from the financial year-end to shareholders by conducting a meeting. After circulation, the auditor passes the audited report to the secretary to arrange for submission to SSM within 30 days from the circulation date.

Tax Return to the Inland Revenue Board of Malaysia (LHDN):

Form E

Employers must submit Form E annually to report employees' income details, including their name, identification number, employment income, and tax deductions. Employers are responsible for deducting the appropriate amount of income tax from employees' salaries and remitting it to the tax authorities.

The deadline for submitting Form E is typically in March of the following year, done electronically through the e-filing system provided by the Inland Revenue Board.

CP204

Used by companies to declare estimated chargeable income and determine installment payments for the upcoming year, CP204 is part of the corporate tax filing process in Malaysia. Companies must submit CP204 within 7 months from the end of their accounting period.

Based on the estimated chargeable income declared, companies must make installment payments through the e-filing system.

Form C

Form C is used by companies to report actual chargeable income, tax adjustments, and other relevant details to the Inland Revenue Board. The deadline for submitting Form C is usually within seven months from the end of the company's financial year. Companies need to provide details of financial transactions, income, expenses, and other relevant financial information. Form C, along with audited financial statements, is typically submitted electronically through the e-filing system.

Conclusion

Late submission of these crucial documents may result in penalties or compounds imposed by SSM or LHDN. Directors must adhere to these deadlines to maintain compliance and avoid legal repercussions.

Engaging these professionals from company secretaries, auditors, accountants, and tax agents not only ensures compliance with regulatory requirements but also provides valuable insights, allowing directors to navigate the intricacies of corporate governance with confidence and precision.

This collaboration ensures precision in meeting regulatory requirements, offering directors the necessary support to steer their businesses toward sustained success.

 

PS : Authored by Syazwan, our secretary associate in THK, in her personal LinkedIn post

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What are the most important clauses in a shareholder agreement?

What are the most important clauses in a shareholder agreement?
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(Sec update) Top 5 Crucial Clauses in Shareholders' Agreement

One or more business partners incorporating a company may seem like a straightforward process that does not require any agreement. However, some of the shareholders may want to consider entering a shareholder’s agreement, especially if you are a minority shareholder in the company.

Although the Companies Act 2016 does provide some protection for shareholders, such as oppression of minority shareholders. When shareholders sign a Shareholders Agreement (SHA), the court typically gives it priority, as the SHA reflects the final intent of the parties' relationship nature.

If “Without” an SHA, it may be more challenging to find legal grounds to make a claim, as the protections provided by the company's constitution may be insufficient.

Leverage our 25 years of unparalleled company secretarial experience to uncover the five (5) indispensable clauses that can make or break your Shareholders' Agreement. Don't embark on your business journey without this invaluable knowledge

Top 5 Clauses in Shareholders’ Agreement

We have pointed out the following five common clauses in a Shareholders' Agreement (SHA) that may help to protect your rights as a minority shareholder:

1. Reserved Matters

In the SHA may state the reserved matters that require unanimous voting by the company. This clause is crucial for minority shareholders, providing protection against the majority shareholders' rights (who are likely to win with a majority vote at company meetings).

Examples of reserved matters such as include changes in the company's business, an increase in the company's share capital (which dilutes everyone's ownership), exercising borrowing powers (such as obtaining substantial loans from banks), or creating security interests (such as registering a charge on company assets).

2. Shareholder Obligations

Each Shareholder's obligations in the company can be clearly defined in the SHA. Such as a common clause states, ''Shareholders shall act in the best interests of the company.'' If each shareholder provides different contributions, this clause helps specify individual obligations.

For example, Mr. A is obligated to invest funds in the company; Mr. B has to contribute his/her expertise in certain areas, maybe in terms of knowledge or skills; and Mr. C, with decades of management experience, oversees and implements various company projects.

3. Directors

Companies usually have an odd number of directors to prevent deadlock situations. For some situations, the majority shareholders may appoint directors count tends to favor them in maintaining control at the executive level.

However, minority shareholders should insist on the right to appoint at least one director by adding this clause in the SHA, ensuring representation on the board allows easy oversight of company operations and protects minority shareholder interests.

4. Equity Transfer

To ensure clear provisions when another shareholder wishes to exit the company, this is preventing potential co-ownership with your competitor. It's crucial to explicitly outline (Exit Conditions) such details in the shareholders' agreement.

Another key provision is the purchase price for the existing shareholder's shares. The Shareholders may state the selling price in the SHA as agreed upon among the Shareholders for whoever exits the company in a certain time. Unless the exiting shareholder agrees to give up shares at the initial investment price (often impractical), some valuation mechanism may be necessary. However, valuing a company can be costly.

Specific clauses like pre-emptive rights, tag-along rights, drag-along rights, and drag-with rights exist and may be included in the SHA but may not be necessary, especially for small to medium-sized enterprises.

5. Dispute Situation

Dispute resolution clauses provide shareholders with options to resolve conflicts among them. For instance, a shareholders' agreement may include an arbitration clause, meaning any disputes must be resolved through arbitration rather than litigation in court.

However, as a minority shareholder, caution should be exercised before agreeing to an arbitration clause unless you fully understand its implications.

In conclusion, shareholders' agreements are common and can effectively protect the interests of all involved shareholders, especially minorities. Even if a company did not initially sign such an agreement, there's nothing stopping shareholders from subsequently doing so.

PS : Authored by Hui Ting, our secretary associates in THK, in her personal LinkedIn post

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enterprise vs sdn bhd

enterprise vs sdn bhd
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(Sec update) Unlocking Tax Incentives: Discover Why SDN BHD Companies Qualify, While Enterprises Miss Out!

Why Sdn Bhd ?

In the vibrant tapestry of Malaysia's business landscape, the decision to venture as an entrepreneur or establish a Sendirian Berhad (Sdn Bhd) is a critical crossroads that warrants careful consideration. While entrepreneurship embodies the spirit of innovation and individualism, incorporating an Sdn Bhd unveils a realm of strategic advantages that can significantly propel your business forward.

Let's delve into the compelling reasons why choosing the corporate path might be the catalyst for unlocking your business potential.

What Sets Apart Sdn Bhd and Entrepreneurship in Malaysia?

The fundamental distinction lies in the legal structure.

Sdn Bhd represents a private limited company, offering legal separation from personal assets, while entrepreneurship often involves individuals operating as sole proprietors without such distinction.

Limited Liability: How Does it Differ in Malaysia?

Entrepreneurs in Malaysia face unlimited personal liability, exposing personal assets to business risks. Contrastingly, Sdn Bhd owners benefit from limited liability, creating a protective shield for personal finances.

Tax Implications: How Does the Choice Affect Taxation in Malaysia?

In the realm of taxation in Malaysia, entrepreneurs find themselves grappling with the impact of their choices on personal income tax and corporate tax. While individual business owners are subjected to personal income tax on their profits, the landscape changes for Sdn Bhd companies, where the focus shifts to corporate tax.

This distinction significantly shapes the tax liability, with Sdn Bhd companies potentially benefiting from lower corporate tax rates and access to tax incentives, thereby creating a more advantageous tax environment.

 Tax incentives are benefits that the government offers to certain businesses to encourage investment and development in Malaysia. Some of the tax incentives are:

  • Pioneer status (PS) : a full or partial exemption of income tax for a period of five years for businesses that produce or do something new or important.

  • Investment tax allowance (ITA) : an extra deduction of capital expenditure for a period of five years for businesses that invest in a new or important project.

Government Grants in Malaysia: A Comparative Analysis for Sdn Bhd, Sole Proprietors, and Partnerships

Private limited companies, commonly referred to as Sdn Bhd, often enjoy more favorable treatment when it comes to government grants and incentives. The Malaysian government frequently tailors these programs to encourage the growth and development of structured businesses.

Sdn Bhd entities generally have access to a broader range of support initiatives, including tax incentives, financial assistance, and industry-specific grants. Conversely, sole proprietors and partnerships may find that their eligibility for government grants is more restricted.

Capital Raising Dynamics: Malaysia's Entrepreneurial Landscape vs Sdn Bhd

Entrepreneurs in Malaysia may find it challenging to raise significant capital individually. Sdn Bhd owners can issue shares, providing a more accessible avenue to attract investors and fund business expansion with financial institution.

Risk Management: Structured Approach vs Personal Liability in Malaysia

Operating as an Sdn Bhd in Malaysia offers a structured approach to risk management, with limited liability safeguarding personal assets. Entrepreneurs, however, bear full personal liability for business risks.

Legal Compliance: Navigating Regulations in Malaysia

Sdn Bhd owners in Malaysia must adhere to complex legal compliance requirements, including audits and regulatory filings. Entrepreneurs, while subject to legal requirements, face a generally simpler compliance landscape.

Key Takeaway

In conclusion, the choice between operating as an Sdn Bhd and pursuing entrepreneurship in Malaysia involves multifaceted considerations. Entrepreneurs and business owners must carefully weigh these factors against their unique circumstances and aspirations, making an informed decision aligned with the dynamic Malaysian business landscape.

PS : Authored by Mohammad Syazwan Bin Ishak, our secretary associates in THK, in his personal LinkedIn post

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Changes to Beneficial Ownership 2023

Changes to Beneficial Ownership 2023
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{Sec Update} Changes to Beneficial Ownership in the Companies (Amendment) Bill 2023

According to Section 2 of the Companies Act 2016, “Beneficial Owner” means the ultimate owner of the shares and does not include a nominee of any description. To strengthen the corporate rehabilitation framework and enhance corporate transparency on the reporting of beneficial ownership of companies, there are some amendments in 8 key areas related to beneficial ownership, in the Companies Amendment Bill 2023. 

1. Definition of Beneficial Owner of a Company?

It is defined as the ultimate owner of the shares and does not include a nominee of any description and a relation to a company, a person is as provided in Section 60A(1).

Section 60A (1) states that a person is a beneficial owner of a company if he/she is a natural person who ultimately owns or controls over a company, which includes a person who exercises ultimate effective control over a company.

2. Guidelines to Identify a Beneficial Owner of a Company

The Registrar of Companies has issued the guidelines for the purpose of identifying beneficial ownership of a company according to Section 60A (2).  

3. Companies are required to record and lodge beneficial owner information with the
    Companies Commission of Malaysia (CCM)

The companies are required to record the beneficial ownership information (name, nationality, place of residence, date of becoming a beneficial owner etc.) in the Company’s register of beneficial owners upon receipt of the reply slip.

This register of beneficial owners must be kept at the registered office or any other place in Malaysia as notified to the Companies Commission of Malaysia (CCM), as stated in Section 60B (2).

In the event of any changes to the particulars in the register of beneficial owners, the company shall lodge the updated information with the CCM.

4. Access to the Beneficial Owner Information 

The Minister has prescribed any person or class of persons who may access the register of beneficial owners or the information, along with the terms and conditions for accessing the register as stated in Section 60B 9(a & b). 

5. Duty of Company to Issue Notices to Obtain Beneficial Owner Information

A company shall send a written notice requiring any member of the company to inform whether the member is a beneficial owner of the company. If the member is not the beneficial owner of the company, the member needs to indicate the person’s particulars who is the beneficial owner of the company, as stated in Section 60C(1)(a).

6. Duty as a beneficial owner of the company to provide information

A person who is a beneficial owner shall notify the company that he/she is a beneficial owner of the company and provide the details according to Section 60D. 

7. Exempted Companies

The Minister may publish in the Gazette an exemption for any class of companies from beneficial ownership reporting, either unconditionally or subject to the terms and conditions as imposed by the Minister. 

8. Penalties

The Company and every officer who contravenes this section may be liable to a fine not exceeding RM20,000.00 and a further fine of RM500 per day during which the offence continues, as stated in Section 60b(6). 

In Summary

The new BO Guidelines under the Companies Amendment Bill 2023 are wider and enforce a reporting on the beneficial ownership of companies. It was tabled for 1st reading in Parliament on 10 October 2023, and was tabled and passed at the 2nd and 3rd reading in Parliament on 28 November 2023. The Bill is tentatively scheduled to be tabled at Dewan Negara in December 2023.

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Federal Court's Ruling on Unlicensed Moneylending

Federal Court's Ruling on Unlicensed Moneylending
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{Sec Update} Lessons from the Federal Court's Ruling on Unlicensed Moneylending

Triple Zest Trading & Suppliers Vs Applied Business Technologies Sdn Bhd [2023]

The Federal Court in Malaysia overturned a Court of Appeal decision, ruling that an ''unlicensed moneylender'' cannot recover either interest or the principal loan amount.

Key Facts

  • Parties Involved: Triple Zest Trading & Suppliers (TZT) and Applied Business Technologies Sdn Bhd (ABT).

  • Loan Amount: RM800,000 with an additional RM800,000 as ''agreed profit''.

  • Collateral: Two parcels of land and four undated cheques valued at RM1.6 million.

  • Issue: TZT defaulted on the repayment of RM800,000 principal.

Court Decisions

  • High Court: Favored ABT, ordering TZT to pay RM1.6 million.

  • Court of Appeal: Limited TZT's liability to only the principal loan sum of RM800,000.

  • Federal Court: Overturned previous decisions, stating that unlicensed moneylenders like ABT cannot recover either the principal or interest, especially when interest rates are exorbitant (100% in this case).

Legal Reasoning

  • The Federal Court deemed the ''agreed profit'' as interest, thus violating the Moneylenders Act 1951.

  • It emphasized that the courts should not assist those who engage in illegal moneylending practices.

  • The agreement was considered void under the Contracts Act 1950.

Implications for Clients

  • Compliance with legal standards: The decision highlights the necessity for all financial transactions, including loans, to be in strict compliance with the Moneylenders Act 1951. Companies and individuals must ensure their lending practices adhere to legal requirements.

  • Risks of unlicensed lending: Engaging in unlicensed lending, particularly with exorbitant interest rates, can result in the inability to recover both the loan principal and interest. This case demonstrates the risks associated with such practices.

  • Legitimacy of ''friendly loans'': The ruling clarifies that companies and individuals can still offer ''friendly loans.'' However, these loans must not include any interest or additional sums exceeding the principal amount. Loans structured in this manner are legally permissible.

  • Prohibition of interest on ''friendly loans'': Any ''friendly loans'' that impose interest or extra charges beyond the principal amount are illegal. The courts will not assist in recovering either the interest or the principal amount in such cases, emphasizing the need for caution and legal adherence in private lending.

  • Importance of legitimate agreements: The decision stresses the importance of having legitimate and legally compliant agreements for any financial transaction.

  • Seeking legal counsel: Given the complexities and legal implications of loan agreements, it is advisable for clients to seek legal advice before entering into any financial agreements.

Conclusion

This landmark ruling serves as a critical reminder of the importance of complying with financial and legal regulations. It discourages illegal lending practices and promotes the legitimacy and enforceability of loan agreements that adhere to the law. Clients are advised to be vigilant and consult legal experts to ensure their financial dealings are within legal boundaries.

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{Sec Update} Essential Documents after Shareholder's Death

{Sec Update} Essential Documents after Shareholder's Death
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{Sec Update} Essential Documents after Shareholder's Death : Key Steps & Requirements

Introduction of Shares Transmission

In the corporate realm, the passing of a shareholder introduces a complex and often overlooked challenge—effectively managing their shares posthumously. This article explores the legal process, and emotional considerations involved in this delicate process of handling shares after a shareholder's demise.

This exploration serves not only as a practical guide for those involved but also as a reminder of the importance of proactive succession planning in preserving corporate legacies.

What is the first step a director should take upon the death of a shareholder?

1. Legal representative

• The director should find and establish contact with the legal representative of the deceased shareholder. This individual plays a crucial role in facilitating the proper handling and transmission of shares.

2. Supporting Document

• Ensuring the availability of crucial supporting documents, such as the grant of probate, letter of administration, or Faraid Certificate, is imperative for a seamless share transmission process. These documents are essential for initiating and completing the necessary legal procedures.

The Legal Title of Deceased Shareholders

When a shareholder passes away, who is recognized by the company as having title to their shares, and how can the transmission process carry out?

  • The legal representative becomes the sole individual acknowledged by the company as having title to the deceased shareholder's shares.

  • The shares can be transmitted to the legal representative upon their request, along with the submission of the grant of probate or letter of administration to the company.

  • The legal representative holds the authority to transfer the shares to the designated beneficiary or another appointed individual.

What are the Crucial Supporting Documents for Smooth Share Transmission?

1. Non-Muslim with a Will:

• Requirement: Grant of Probate issued by the High Court.

• Process: Handled by the executor empowered to administer the estate.

2. Non-Muslim without a Will:

• Requirement: Letter of Administration issued by the High Court or Land Administrator.

• Process: Administered by an appointed administrator empowered to handle the estate.

3. Muslim:

• Requirement: Faraid Certificate issued by the Syariah Court.

• Process: Administered by Amanah Raya, empowered to handle the estate.

In conclusion, this article underscores the complexity of managing a deceased shareholder's shares in the corporate realm. Emphasizing the necessity of proactive succession planning, it highlights the crucial supporting documents required for smooth share transmission.

The conclusion emphasizes the director's pivotal role in promptly engaging with the legal representative and ensuring the availability of essential paperwork. This proactive involvement is key to achieving a seamless share transmission process, ultimately safeguarding the company's interests following a shareholder's passing.

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Insolvency Act Amendments 2023

Insolvency Act Amendments 2023
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Insolvency Act Amendments 2023

Latest Development on Insolvency Malaysia

The Insolvency Act (Amended) 2023 will come into force on Friday (Oct 6), says Datuk Seri Azalina Othman Said.

The Minister in the Prime Minister's Department (Law and Institutional Reform) said the amendment resulted from discussions between the Attorney General's Department, Federal Court Chief Registrar, Finance Ministry, Bank Negara Malaysia, Inland Revenue Department, Employees Provident Fund, Credit Counselling and Management Agency and Associations of Bank Malaysia.

Key Summarise

Here's a summary of the key points from the Insolvency (Amendment) Act 2023

Discharge from Bankruptcy

The Insolvency (Amendment) Act 2023, effective from 06.10.2023, brings changes to bankruptcy regulations.

It expands the categories of bankrupt individuals who are protected from objections by creditors when a certificate of discharge from bankruptcy is issued by the Director General of Insolvency (DGI).

The existing Insolvency Act 1967 prohibits creditors from objecting to discharge for certain categories, including social guarantors, persons with disabilities, deceased individuals, and those with serious illnesses.

The Amending Act adds two new groups: bankrupts with mental disorders certified by a psychiatrist from a government hospital and bankrupts aged 70 or older, deemed incapable of contributing to estate administration by the DGI.

Automatic Discharge from Bankruptcy

The Amending Act revises Section 33C of the Act regarding a bankrupt's right to automatic discharge.

Previously, automatic discharge occurred after three years if the bankrupt met certain criteria.

Post-amendment, automatic discharge happens three years from the submission of the statement of affairs if the bankrupt pays a sum determined by the DGI for estate administration purposes.

This change is expected to benefit a significant number of bankrupt individuals in Malaysia, with an estimated 130,000 people being discharged from bankruptcy.

Suspension of Automatic Discharge from Bankruptcy

The Amending Act introduces the concept of suspending automatic discharge for up to two years if the bankrupt fails to comply with their obligations under the Act.

The suspension is effective upon notice from the DGI to creditors who filed a proof of debt within six months before the original three-year mark.

Remote Communication Technology and Electronic Communications:

Section 14 of the Amending Act allows the DGI to hold creditor meetings using remote communication technology, reflecting a transition to remote hearings due to the COVID-19 pandemic.

Previously, meetings were held at locations deemed convenient for the majority of creditors.

Section 13 of the Amending Act amends Section 130 of the Act to permit electronic means for serving notices when consent is obtained.

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Memorandum & Articles of Association vs Constitution

Memorandum & Articles of Association vs Constitution
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M&A vs Constitution

Under the Companies Act 1965, every company was required to have a Memorandum and Articles of Association (M&A). According to the Companies Act 2016, the Memorandum and Articles of Association (M&A) are now referred to as the Constitution. Companies incorporating under the Companies Act 2016 are not obligated to have a constitution immediately upon incorporation. However, they have the option to adopt a constitution after the company has been incorporated.

The Differences

You may notice the following differences between M&A and the Constitution.

1. Number of Directors

2. Annual General Meeting

3. Reduction of Share Capital

4. Share Certificate

Number of Directors

In the M&A under the Companies Act, 1965, a minimum of two directors is required for Sdn Bhd.

However, Constitution is under the Companies Act, 2016, therefore if not being fixed by the company itself, sole director is allowable.

Annual General Meeting

During M&A era, an AGM was a mandatory requirement for a company, therefore the compliance of the timeframe to call for an AGM needs to be complied.

Whereas, in the new act regime, a Sdn. Bhd is no longer required to call for an AGM if the constitution is silent, where to follow the Companies Act, 2016 requirement.

Reduction of Share Capital

Under the Constitution regime, the reduction of share capital is a more streamlined process that outlines the requirement for solvency statements and other procedures

Whereas if under M&A regime of the Companies Act, 1965, it must go through a court order.

Share Certificates

In M&A, issuing a share certificate is a mandatory requirement for all shareholders, whereas, if the Constitution is silent, the issuance of a share certificate is upon request.

Key Takeaways

The above outline highlighted key differences between M&A and the Constitution regime, there are some more variances in terms of requirements of directors, holding of meeting procedures, issuance of dividends, and other pertinent aspects. To provide a more in-depth and details examination of these distinctions, further exploration of specific areas or aspects is needed.

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What are proxy rules in the meeting ?

What are proxy rules in the meeting ?
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What are proxy rules in the meeting ?

What exactly is a proxy?

In the world of business and formal meetings, a ''proxy'' refers to a person who appointed to represent someone else, typically when the primary individual is unable to attend the meeting themselves. The proxy has the responsibility to act on behalf of the absent individual, making decisions, casting votes, or conveying information as required during the meeting.

What if only one proxy?

If a member appoints a proxy during a meeting and that proxy can vote on show of hands. The proxy allows to make important decisions and discussions to proceed even when key stakeholders cannot be physically present. It ensures that their interests are still represented and their input is considered.

Can a member choose more than one proxy?

Certainly! A member eligible to vote can pick one or more proxies. But remember, these proxies can only vote in a poll.

However, the appointment only counts if the member specifies how much of their stake each proxy represents.

What is Proxy’s responsibility?

The responsibilities of a proxy can vary depending on the context in which they are appointed and the specific instructions or authority granted to them by the absent individual. However, here are some common responsibilities associated with being a proxy: -

a) Representing:

The primary responsibility of a proxy is to represent the absent individual faithfully and in accordance with their interests, preferences, and instructions. This includes speaking on their behalf, voting as directed, and making decisions in their stead.

b) Attendance:

Proxies are expected to attend the meeting or event in place of the absent individual. They should arrive on time and be prepared to participate in discussions, votes, and any other relevant activities.

c) Knowledge and Preparation:

A proxy should be knowledgeable about the issues, topics, or agenda items to be discussed at the meeting. They may need to review relevant materials or information in advance to make informed decisions on behalf of the absent party.

d) Voting:

If voting is part of the meeting, a proxy typically casts votes as instructed by the absent individual. This may involve voting on resolutions, proposals, or other matters according to the absent individual’s preferences.

e) Reporting:

After the meeting, a proxy may be required to provide a report or summary to the absent party, detailing what transpired during the meeting, the decisions made, and any important discussion or outcomes.

f) Communication:

Proxies often serve as a communication channel between the absent individual and other participants in the meeting. They may convey messages, questions, or requests as necessary.

g) Adherence to Instructions:

It’s crucial for a proxy to strictly adhere to the instruction, limitations, and wishes of the absent individual. They should not make decisions or take actions that go against the absent party’s directives.

h) Confidentiality:

If sensitive or confidential information is discussed during the meeting, a proxy must maintain confidentiality and not disclose such information to unauthorised parties.

i) Ethical Conduct:

Proxies should act with honesty, integrity, and in a manner consistent with ethical standards. They should avoid conflicts of interest and act in the best interests of the absent individual.

Key Summary

It is important for individuals acting as proxies to have a clear understanding of their role and responsibilities, as well as any legal or contractual obligations associated with their appointment. They should also maintain open communication with the absent party to ensure they fulfil their duties effectively.

 

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Disqualification of Director Malaysia

Disqualification of Director Malaysia
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Disqualification of Director Malaysia

Background

In order to become a director of the company, he must write his consent in writing to become a director and make a declaration that he is not disqualified from being appointed in compliance with Section 201 of the Companies Act 2016.

How to determine if a person is disqualified to become a director?

There are a few ways to determine whether a person is disqualified to become a director of the company. One of the criteria for disqualification of a director includes a committed offence.

What is offence included under this act?

• Bribery;

• Fraud; and

• Dishonesty

Why is a person who committed an offence unable to become a director of the company?

One of the duties of the director require to manage the asset on behalf of the company. If he becomes an undischarged bankrupt person he is not being trusted by the interested party to manage the company.

What will happen if a person failure to comply?

A person who failed to comply under this Section are convicted and be liable :

• to imprisonment for a term not exceeding 5 years; or

• to a fine not exceeding RM1,000,000.00; or

• to both

A person who committed an offence still be able to become a director?

Yes, a person may be re-appointed or hold office to become a director of the company. However, he must apply for leave from the Official Receiver or from the Court.

What is the meaning of the leave?

Leave is permission is granted by the Court

How to apply for leave from the court?

A person intending to apply for leave may follow the below informations :

1. Notice

• Send a notice of intention to apply for leave has been served on the Official Receiver;

• Send a notice of intention to apply for leave has been served on the Registrar not less than 14 days;

2. Heard on application - The official receiver is heard on the application.

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Share Transfer on Death of Shareholder

Share Transfer on Death of Shareholder
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Share Transfer on Death of Shareholder

Background

When a shareholder dies the right to his interest in the shares will pass to whoever inherits them under his will or intestacy. The deceased shareholder's rights will be administered by his or her executors (if there is a will) or administrators of the estate if the shareholder has died intestate.

Two deciding legal considerations

The beneficiary can make a written request to the company to appoint someone registered as the holder of the inherited shares. The very same appointed person can also execute an instrument or transfer in respect of it. However, this can be a complicated and time-consuming process

  • Does the deceased shareholder have a will?

  • Is there any buy-sell agreement? 

The Will

The appointed executor will carry out the following: -

  • Obtain the grant of probate (GOP) from the high court.

  • Notify the Company Secretary regarding the share to be transmitted according to Section 109 of the Companies Act 2016.

What If There Is No Will?

Family members need to obtain a Letter of Administration (LA) by engaging a lawyer for the application process.

  • An administrator will be appointed

  • Once the administrator received the court order,

  • Notify the Company Secretary regarding the shares to be transmitted according to Section 109 of the Companies Act 2016. 

Buy-Sell Agreement

It’s to outline the terms and conditions under which the shares of a deceased shareholder will be purchased by the surviving shareholders or the company itself. 

The agreement includes provisions such as the purchase price, valuation methods, funding mechanisms, and the process for executing the buyout .

The agreement will be presented to the Company’s Secretary to proceed with the transfer of shares under Section 105 of the Companies Act 2016.

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Allotment of Shares Capital In Malaysia

Allotment of Shares Capital In Malaysia
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Allotment of Shares Capital In Malaysia

In Malaysia, the allotment of share capital plays a pivotal role in the establishment and growth of companies. Share capital represents the financial foundation upon which businesses raise funds and allocate ownership stakes to investors.

The process of allotment involves the issuance and distribution of shares among shareholders, facilitating investment opportunities and facilitating capital infusion.

Through a well-regulated framework overseen by the Companies Commission of Malaysia (SSM), the allocation of share capital not only enables companies to raise funds but also fosters economic development, corporate governance, and investor protection in the vibrant Malaysian business landscape.

What does it mean?

Allotment of Shares where investors invest more money in the company. By doing this, it might or might not affect the share structure of the company. All these mainly depend on the investors’ mutual agreement.

How could it affect the structure of the company?

The investors could decide on investing the same proportion of money according to the existing portion so this would not affect the structure of the company as well as the existing right of the shareholders.

But in there are new investors added in with a certain amount of money injected into the company, these action will directly changing the proportion of shares and rights of the shareholders.

How many ways of allotment of shares?

There are 2 ways you could proceed to increase the paid up capital.

A) Allotment of shares via cash considerations

  • Investors/shareholders injected cash into the company via bank in a lump sum of money to the bank.

  • Must be issued for real value in money.

  • Shares allotted must be paid in full and in cash.

  • Proof evidence of bank in slip.

B) Allotment of shares via otherwise than in cash

  • Investors/shareholders paid on behalf of the company certainly in kind for the sake of the business of the company.

  • proof of management account or other documents.

Who could assist you in the allotment of shares?

You may approach your company’s secretary, he/she will assist you in the allotment of shares in SSM.

What are the documents that will prove the allotment of shares?

After your secretary submitted to SSM, you will receive Section 51 to prove your company’s structure. And you may request Share Certification from the Secretary.

Will the allotment of shares affect the shareholders’ rights in the company?

Subject to the Constitution, a company may issue shares that rank equally with existing shares as to voting/distribution rights. Those shares shall first be offered to the holders of existing shares.

If the offer is not accepted after the expiry of the offer date specified in the notice, the Directors may dispose those shares in such a manner as the directors think is most beneficial to the company.

What are the documents involved in the allotment of shares?

You may receive Section 76, Section 78 and Section 51.

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How to raise fund for Sdn Bhd?

How to raise fund for Sdn Bhd?
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How to raise fund for Sdn Bhd?

Every business no matter small or big in size requires funds to run and to meet its business requirements. So, a company needs to raise funds to sustain and expand its business, it may raise funds in different ways:-

Common ways to raise funds

1. Right Issue

2. Bonus Issue

3. Preference share allotment

4. Looking for SME financing

5. CrowdFunding

6. Apply for Government Grant

7. Commercial Bank Loans, Debentures and Overdarft

Right Issue

• Right issue is the company offering rights to existing shareholders to buy additional shares directly from the company at a discounted price.

• The number of shares offering by the company is depending on the number of shares of the existing holdings of shareowners.

• The existing shareholders are given the right to take up the shares offer to them or they want to renounce their right.

Bonus Issue

• Bonus Issue is a way of issue of new shares to its existing shareholders according to the same proportion of the existing share percentage,

• it would not dilute the existing shareholders’ equality or rights.

• The company issue bonus shares with the intention to attract retail investors, provide an alternative to a cash dividend, and also reflect a healthy financial in order to attract more fund investing in the company.

Preference share allotment

• Preference share is a share that does not entitle the holder to the right :

  • to vote on a resolution

  • to any right to participate beyond a specific amount in any distribution whether by way of dividend,

  • on redemption, in a winding-up, or otherwise.

• Its means that the founder does not need to give up their control of the company while having access to funds and the investors are assured of priority in getting returns on their investments.

Looking for SME financing

• Small and Medium Enterprise may apply for loans from another servie financial provider who offers targeted financial assistance, such as :

  • bank;

  • other licensed financial institutions

  • peer-to-peer financing.

Crowd Funding

• Crowdfunding is the practice of funding or venture by raising funds from a large number of people, normally the transaction will be via the internet and crowdfunding platform, so these funding sources could leverage the networks for greater reach and exposure.

Apply for Government Grant

• Every year the government has grant a sum of money to a business or individual to support them to grow, implement and establish the ideas or projects with the ultimate intention to grow the country's economy or society's developments.

• There are some grants such as Working Capital Guarantee Scheme (SJMK), Penjana Kerjaya 2.0, Wage Subsidy Programme (WSP 3.0) and etc.

Commercial Bank Loans, debentures and Overdraft

• A company may apply for an amount of money from a certain bank at a certain fixed or floating interest rate for a certain period of time, or the company may withdraw a limit on borrowing on a bank current account with an overdraft amount that may vary on a daily basis.

• On top of it, the company may also raise it funds via issuing debentures which is a long-term loan that is usually secured against a specific or overall assets of the company with committing a fixed date of repayment at a certain fixed rate of interest.

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How to incorporate a company in Malaysia ?

How to incorporate a company in Malaysia ?
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How to incorporate a company in Malaysia ?

How to on Youtube

Watch the full 30-minute video on our YouTube https://youtu.be/K1tEqVH8vM4

Key Information of the Recorded Webinar

  1. Topic : How to setup a company in Malaysia?

  2. Date : 31/03/23

  3. Time : 10:30am

  4. Location : Live Interview (recorded)

  5. Speakers : Jasmine Ma, a licensed company secretary from THK

  6. Moderator : Koh Teck Peng, an approved auditor & tax agent from KTP

Agenda :

1) What company name do you want your company to be called?

2) What words/symbols are prohibited by SSM for you to use?

3) How many directors do you want your company to have?

4) How many shareholders your company will have?

5) Does a company need a secretary?

6) What is the nature of the business of your company?

7) What is your company's paid-up capital?

8) How long for the whole process of incorporation?

9) & more

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How can I reduce my share capital in Malaysia?

How can I reduce my share capital in Malaysia?
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How can I reduce my share capital in Malaysia?

What does it mean?

A capital reduction is when a company reduces its share capital to a certain amount of its share capital by making payments to its shareholder out of its capital equal to the amount that the shareholder invested in the company, or it could be by a share buyback.

Why would a company want to reduce share capital?

So, before a company’s director decides to reduce the company's share capital, we need to study why we need to do that: -

It could be: -

1) to create distributable reserves to pay a dividend; or

2) to buy back or redeem its own shares; or

3) to reduce or eliminate losses; or

4) to return surplus capital to shareholders;

5) to change in capital structure; etc

How to proceed with the reduction of share capital?

There are 2 ways you could proceed to share capital reduction.

1) By way of Court Confirmation Procedure (Section116, CA 2016).

2) By way of solvency statement procedure (Section 117, CA 2016).

Why do people choose Solvency Statement Procedure?

1) it is faster

2) it incurs less cost

3) it is more simplified and less tedious

Who could assist you with Solvency Statement Procedure?

  1. Accountant for Solvency Statement preparation and

  2. Company Secretary

Reduction of Share Capital via Solvency Statement Procedure for Sdn. Bhd.

Under Section 115 (b), CA 2016, unless otherwise provided in the constitution, a company may reduce its share capital by a special resolution supported by a solvency statement in accordance with Section 117.

A) Solvency statement

1. All directors have to make a solvency statement in relation to the reduction of share capital within 14 days before the end of the date of a special resolution passed by members of a company to approve the reduction of share capital.

(Solvency statement is not required if the reduction is mainly for the purpose of cancellation of any loss of paid-up capital or unrepresented by available assets.)

2. Special resolution passed by way of written resolution must be accompanied by the solvency statement, or if passed at a general meeting, the solvency statement must be made available for inspection throughout the meeting.

3. The solvency statement must be available for the creditor’s inspection for six weeks at the company’s registered office.

B) Within 7 days after the resolution is passed, the company must send a notice to IRB and the Registrar stating that the resolution has been passed together with the solvency statement. And within the same period, the company must advertise a notice of the reduction of the share capital in one widely circulated in Malaysia in the national language and one widely circulated newspaper in Malaysia in English under Section 117(10).

The company’s creditor will have six weeks from the date of the resolution to give a notice of application from the court to the Registrar to cancel the resolution.

If there is no application for cancellation from the creditors after 6 weeks, the company must lodge the following documents with the Registrar within 2 weeks after the period of 6 weeks under Section 119(1)

a) a copy of the resolution;

b) a copy of the solvency statement, if applicable;

c) a statement made by the directors under Section 117(1) and Section 117(3).

d) a copy of the newspaper advertisement.

C) The capital reduction will take effect once the Registrar has recorded the information lodged to them.

 

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  • Wisma THK, 41, Jalan Molek 1/8, Taman Molek, 81100 Johor Bahru

KTP (Audit, Tax, Advisory)

An approved audit firm and licensed tax firm operating under the KTP group based in Johor Bahru providing audit, tax planning, advisory and compliance services to clients

THK (Secretarial, Bookkeeping, Payroll, Advisory)

A licensed secretarial firm in Johor Bahru providing fast reliable incorporation, secretarial services, corporate compliance services, outsourcing bookkeeping, and payroll services to clients

KTP Lifestyle

An internal community for our colleagues on work and leisure.

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An external job community on vacancies in Johor Bahru for interns, graduates & experienced candidates.

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What is Company Secretary?

What is Company Secretary?
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What is Company Secretary?

A Company Secretary is a senior position in a citizen sector establishment. Also known as Compliance Officers, it is one of the positions that is a part of the key managerial personnel (which usually includes the CEO & CFO) of any company.

In large American and Canadian publicly listed corporations, a Company Secretary is typically named a Corporate Secretary.

A Company Secretary is responsible for the efficient administration of a company, particularly with regard to ensuring compliance with statutory and regulatory requirements and for ensuring that decisions of the board of directors are implemented.

Roles of Company Secretary

 

A.         Helps you with starting a Company (incorporation),

He/she provides you with advice in terms of corporate restructuring, mergers, acquisitions, complying with good corporate governance

 

B.         Advise you on other laws and regulations compliances such as tax issues, business licenses, EPF, Socso, and EIS contributions.

 

C.         Attend and arrange Board or Members Meetings.

He/she assists you in drafting the Agenda, and sending out the notice to ensure that the meeting is properly called, constituted, and carried out according to the laws.

 

D.         Ensure the Company complies with the rules set out in the Companies Act, 2016.

 

E.         Maintain Statutory Records for the Company.

He/she is to ensure that the Company register books are recorded up to date, as well as the records books are kept for a period according to the requirements of the laws.

 

F.         Handle and arrange the Company’s Annual General Meeting.

He/She ensures that the meeting is carried out properly during the whole process of the meeting.

He/She prepares the minutes of the meeting once the meeting is adjourned.

 

G.        Prepare and file the Company’s annual return and audited financial statements with the Directors’ reports.

He/she ensures that the Company is in compliance with these deadlines.

 

H.         Update and maintain the Company’s Statutory Books and documents.

The Company details such as directors, shareholders, paid-up capital, shares and constitution will be changed from time to time.

He/she is responsible for notifying the registrar of the changes and updating all related records.

Visit Us

  • Wisma KTP, 53 Jalan Molek 1/8, Taman Molek, 81100 Johor Bahru

  • Wisma THK, 41, Jalan Molek 1/8, Taman Molek, 81100 Johor Bahru

KTP (Audit, Tax, Advisory)

An approved audit firm and licensed tax firm operating under the KTP group based in Johor Bahru providing audit, tax planning, advisory and compliance services to clients

THK (Secretarial, Bookkeeping, Payroll, Advisory)

A licensed secretarial firm in Johor Bahru providing fast reliable incorporation, secretarial services, corporate compliance services, outsourcing bookkeeping, and payroll services to clients

KTP Lifestyle

An internal community for our colleagues on work and leisure.

KTP Career

An external job community on vacancies in Johor Bahru for interns, graduates & experienced candidates.

This message was brought to you by KTP

 

Audit Exemption Malaysia

Audit Exemption Malaysia
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Document Required for Audit Exemption

After our sharing on the qualifying criteria for audit exemption, let us further share more information on the documents required for submission of unaudited financial statements to Suruhanjaya Syarikat Malaysia (SSM)

Question :

Do the Company still require to submit a financial report to SSM even though the company is qualified for audit exemption?

Yes, the company is required to prepare the financial statement for submission to SSM.

What are the documents for the submission of the financial statement?

1. Audit Exemption Certificate

In compliance with Section 258 and Section 259 of the Companies Act 2016.

2. Unaudited Financial Statements

In compliance with applicable approved accounting standards.

3. Directors’ Report, Statement by Directors, and Statutory Declaration Under Section 251 and Section 252 of the Companies Act 2016.

Source

For more information on Practice Directive No. 3/2017

  • https://bit.ly/3Bgm0Pf

Visit Us

  • Wisma KTP, 53 Jalan Molek 1/8, Taman Molek, 81100 Johor Bahru

  • Wisma THK, 41, Jalan Molek 1/8, Taman Molek, 81100 Johor Bahru

KTP (Audit, Tax, Advisory)

An approved audit firm and licensed tax firm operating under the KTP group based in Johor Bahru providing audit, tax planning, advisory and compliance services to clients

THK (Secretarial, Bookkeeping, Payroll, Advisory)

A licensed secretarial firm in Johor Bahru providing fast reliable incorporation, secretarial services, corporate compliance services, outsourcing bookkeeping, and payroll services to clients

KTP Lifestyle

An internal community for our colleagues on work and leisure.

KTP Career

An external job community on vacancies in Johor Bahru for interns, graduates & experienced candidates.

This message was brought to you by KTP

 

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THK Group of Companies THK Management Advisory Sdn Bhd  200401000220 (638723­X) THK Secretarial PLT 202304003367 (LLP0037327-LGN)

Wisma THK, No. 41, 41-01, 41-02, Jalan Molek 1/8, Taman Molek, 81100 Johor Bahru, Johor, Malaysia.
+6012-771 7903
+607-361 3443

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