Part 5: Public Sector Accounting Malaysian Context

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Part 5 Public Sector AccountingMalaysian
Context

• i. Malaysian Government

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Lecture Outline

• Malaysian Government (1)
• Powers of Government
• Relationship bet. the Federal Govt. State Govt
• Government Accounting Machinery (1)
• Agencies
• Personnel
• Systems and procedures
• Financial Provisions (2)
• Revenues
• Expenditures
• Borrowings
• Financial Procedure Act 1957
• Treasury Instructions
• Financial Reporting Auditing (1)
• Legal requirements
• Reports within Public Accounts
• Duties responsibilities of Auditor general
• Public Account Committee
• Development in Accounting Practices (1)

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MALAYSIAN GOVERNMENT

• Ministries
• Departments
• Public Enterprises

FEDERAL GOVERNMENT
STATE GOVERNMENT

• Departments
• Public Enterprises

• City Council
• Municipal Council
• District Council

LOCAL GOVERNMENT
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POWERS OF GOVERNMENT

• Separation of powers (Federal and State)
• Divided into three
• Legislative
• Executive
• Judicial
• Objectives
• To ensure a just and fair government
• No one party within government have absolute power

Each of them is independent from one to another
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POWERS OF GOVERNMENT
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POWERS OF GOVERNMENT

• Legislative Power
• Power to make new laws or to amend or to repeal
  existing laws
• Power to levy taxes or to change the tax regime
• Power to sanction expenditure of public money.
• Article 44
• At Federal level the power is vested in the
  Parliament
• At State level the power is vested in the State
  Legislative Assembly

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POWERS OF GOVERNMENT

• Executive Power
• Power to formulate new policies that will be
  implemented by government administrative agencies
• Article 39
• At Federal level the power is vested in the YDP
  Agong and exercisable by him or by cabinet
  ministers led by the PM
• The PM must be a member of House of
  Representatives and commands a majority in
  Parliament
• At State level the power is vested in the Ruler
  exercisable by him or by the Executive Council
  (EXCO)

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POWERS OF GOVERNMENT

• Judiciary Power
• Power to hear and determine civil and criminal
  matters
• Power to pronounce on the legality of any
  legislative or executive act and procedures
• Power to interpret the Federal and State
  Constitutions
• Led by the Chief Justice (CJ)
• CJ is appointed by YDA Agong on the advice of the
  PM after consulting the Conference of Rulers

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Relationship bet. The Federal and the State
Government

• Part IV of the Constitutions

FEDERAL
STATE
FINANCIAL
LEGISLATIVE
EXECUTIVE
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Federal vs State

• Legislative Relationship
• 3 Articles
• Article 74
• Parliament is empower to make laws applicable
  throughout the country (federal list or
  concurrent list or any laws provided by the
  Constitutions)
• State legislature may make laws applicable to
  state (state list or concurrent list or any laws
  provided by the Constitutions)

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Federal vs State

• Article 75
• Both the Federal and State government are
  empowered to enact any law for the concurrent
  list
• Article 76
• Parliament may make any law for the state for the
  following purposes
• Implementation of treaty, agreement or convention
• Ensuring uniformity of laws
• Requested by the State Legislative Assembly
• Article 77
• State Legislature may make laws on matters not
  specified by all the three lists provided it is
  not within the jurisdiction of the Parliament to
  make such laws
• General rule any law shall not contradict with
  the Federal Constitutions

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Federal vs State

• Federal, State and Concurrent Lists

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Federal vs State

• Executive Relationship
• 2 Articles
• Article 80
• Federal executive authority to all matters that
  the Parliaments is empowered
• State - executive authority to all matters that
  the State Legislature is empowered
• Exception to the above provision, Federal Govt.
  may
• Conduct enquiries, surveys and collection of
  statistics
• Assist the state in conducting researches, the
  provision and maintenance of experimental
• Inspect State activities

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Federal vs State

• Article 81
• (Obligation of State to the Federal)
• Comply with any Federal law applying to the state
• Not to impede or prejudice the exercise of the
  executive authority of the Federation

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Federal vs State

• Financial Relationship
• Revenues
• There are revenues that accrue to the Federal
  Governmentand specifically assigned to State
  government
• Expenditures Commitments
• Both the Federal and State government are
  required to cover their expenditure
• If states are unable to cover their expenditure,
  the Federal will provide financial assistance
• Borrowings
• There is restriction on borrowing for both the
  Federal and State government