Securities Commission Adopts IOSCO methodology

The Securities Commission (SC) has adopted the International Organization of Securities Commission's (IOSCO) methodology for assessing domestic securities market regulations. IOSCO is the main standard setter for the regulation of capital markets.

Accounting Standards

The Malaysian Accounting Standards Board (MASB) has Exposure Drafts of proposed accounting standards on its website. The MASB publishes these to elicit public comment prior to final deliberation and issuance.

The MASB will also introduce a new set of Islamic accounting standards by the first quarter of 2005. Specifically, it plans to introduce standards on ijarah (leasing), zakat (tax), murabahah (deferred sales) and takaful (insurance). This adds to the previous set of Islamic accounting standards MASB introduced in 2001.

Corporate Governance

A new Witness Protection Bill, anticipated to come into force during 2004, gives legal protection to those who alert authorities to acts of corporate misconduct.

Universal application of ISDA Master Agreement for OTC Derivatives

At the 45th Banking and Financial Law School Seminar, the Bank Negara Malaysia (BNM) Governor endorsed universal application of the International Swaps and Derivatives Association (ISDA) Master Agreement for over-the-counter (OTC) financial derivatives contracts. This recognizes the global nature of financial market transactions and the need for a global perspective in managing risk, where legal documentation of derivatives plays a role in mitigating risk for banks and businesses.