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5 Ways Hiring An Accountant Can Save You Money

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Post date March 12, 2021
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5 Ways Hiring An Accountant Can Save You Money

Accountants now play a variety of roles in the overall efficiency and success of a business because their role is no longer limited to being just a professional who deals with the taxation of the company. Instead, the role and responsibilities of the accounting services in Malaysia have greatly expanded over a period of time.

Professional auditors and accounting firms have years of experience in dealing with a variety of businesses and common issues involved in running a company. Therefore, accounting services are important in giving reliable and efficient advice to the managers and business owners for better management.

Startups and small businesses often assume that hiring accounting services in Malaysia will put too much financial burden on their resources. However, relying on an accountant will help you in saving a significant amount of money in the following five ways:

1. Tax Advice

The taxation law and procedures in all countries, including Malaysia, are quite complex. Therefore, it is highly important to rely on the advice and help of professional accountants who are familiar with these tax procedures and can help your business in accurate and efficient taxation.

It can help you in saving money because you will only be paying the taxes that you actually have to pay. Without the knowledge of the laws and tax incentives in Malaysia, you can end up paying excessive amounts in taxes.

On the other hand, accounting services will make sure that your business is getting all of the available incentives and tax relief to help you in cutting down the tax bill.

2. Prepare Financial reports

Financial reporting is one of the most critical parts of any type of business. It is important to make sure that proper calculations are made to generate annual and quarterly financial reports and generate cash flow statements. The purpose of statements of cash flow is to determine the money flowing in and out of the company.

With accurate and reliable financial reporting, you are able to determine the financial health of different parts of your business. You can hire an audit firm in Malaysia to thoroughly evaluate your finances and prepare reliable reports that can ultimately help you in making better business decisions.

3. Business Growth

It is the goal of every other business to grow over a period of time. However, it is a common phenomenon that with a rise in the value and sales of a company, its management tends to become more inefficient due to a variety of reasons. Hiring professional accounting services in Malaysia will make sure that you get the best advice about the growth and overall management of your company’s finances.

An accountant is capable of managing all the expenses of company processes like expansion, production, and payroll management. Having an accountant will facilitate the entire process of business growth. They can also help

4. Free-up Your Time

When you are running a business, there are many things that you have to manage and consider to make your company successful. As a business owner, you can fully understand the importance of time. By hiring accounting services in Malaysia, you will save a significant amount of time, as the accountants will streamline the accounting functions of your company.

You will not have to worry about financial management, as all of these processes will be managed by the auditors and accountants.

Moreover, audit firms will make sure that all of the essential records are thoroughly maintained and important tax deadlines are met to avoid penalties. All of these services will ultimately help you in freeing up your schedule. Hence, you will have more time to spend in managing other parts of the business and build strong relationships with the clients.

5. Consulting

Accounting and audit firms work with a variety of businesses in different sectors, so they are fully familiar with the best practices that can help your business. Ultimately, the experience and expertise of the accountants are important in not only saving money but also optimizing the performance of the business.

In a Nutshell

In short, there are numerous advantages that you can enjoy by hiring professional accounting services in Malaysia.

Accountants can help you in financial management, payroll management, and efficient auditing to plan for business growth and improve the efficiency and productivity of your business to help you in making more profits.

For more information, feel free to get in touch with us.

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8 Reasons Why Good HR Service is Important for Your Organization

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Post date March 12, 2021
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8 Reasons Why Good HR Service is Important for Your Organization

Human Resources (HR) is a broad term that covers the management and development of the employees in an organization. The importance of having good HR services in your company cannot be understated because it has applications in many different areas of your business. Whether you are involved in the strategic planning of your business or want to hire a new batch of talent, you will need the help of professional payroll and HR services.

Reliable and efficient HR services can bring a significant boost in the productivity of your business and enhancing employee performance. It can help you in achieving your business goals. Following are eight main reasons why you should consider an accounting firm in Malaysia so that you can enjoy reliable payroll and HR services:

1. Recruitment and Onboarding

Professional HR recruiters are very familiar with the best strategies for hiring the best talent for your company. They can oversee the entire process of screening resumes to conduct thorough interviews and make sure the right people are appointed in your company.

Moreover, you will not have to worry about the quality of the recruitment and onboarding process, as all of it will be handled by the payroll and HR services.

2. Payroll Management

Payroll and HR services can help your business in establishing a smooth organizational culture and implement maximum fairness and transparency in payroll functions. You can get advice from the experts of the accounting firms in Malaysia to improve strategic decision-making and align your business processes with the business goals.

3. Benefits Analysis

HR experts implement the best recruitment strategies to cut down the unnecessary costs associated with the hiring process and turnover. These experts have the perfect skills to negotiate better terms and conditions that are fair for both the organization and the employees.

As a result, you do not have to exceed your budget to keep the employees happy. It will help your business in attracting the best talent to your company and retain your staff.

4. Risk Management

Providing safe working conditions is the primary responsibility of employers. Payroll and HR services also include risk management specialists who are familiar with the legal rules and regulations to ensure your company is complying with the code of conduct and has a safe organizational culture.

It also includes conducting regular training about workplace ethics and anti-harassment seminars to prevent such issues in the future. Risk management plays an important role in reducing the liability issues associated with unfair employment practices.

5. Training and Development

Conducting orientation for the new employees and regular training sessions for the existing employees is important to build a strong employer-employee relationship. By getting professional payroll and HR services, you will be getting access to the experts who have years of experience in training the employees to become the best fit in an organization.

It will also promote fair employment practices and facilitate the employee who aspires to be in management positions in the future.

6. Conflict Resolution

Conflicts are inevitable in the workplace. Even if you think that your staff is fully satisfied, some kind of dispute can always arise due to different situations. A professional HR specialist is fully equipped to deal with such arguments and disagreements to make sure that the conflict is fully resolved.

Quick conflict resolution is likely to increase employee satisfaction and restore positive working relationships throughout the company.

7. Compliance

Complying with the state, federal, and local rules and regulations can be challenging because there are many situations in which companies can unintentionally violate some rule. Such problems can easily be avoided by hiring a professional accounting firm that is familiar with the rules and regulations related to the accounting processes.

Similarly, payroll and HR services will ensure that your recruitment process and payroll management are in maximum compliance with the law.

8. Performance

In a Nutshell

These are the critical reasons why you should hire the best payroll and HR services. These services will ultimately give your company a much-needed boost in the productivity and efficiency of the business processes and employee performance.

For more information, feel free to get in touch with us.

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What is an Annual Return and How to File it?

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Post date March 12, 2021
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What is an Annual Return and How to File it?

After registering and incorporating your company in Malaysia, you will have to take care of several aspects of the business to ensure you are in complete compliance with the legal rules and regulations. One such requirement is filing annual returns, one of the most critical legal needs in Malaysia.

If you are not familiar with annual returns and how to file them, you have come to the right place. As in this article, you will get all of the essential information about it.

1. What is an Annual Return?

The Companies Commission of Malaysia makes it compulsory for every company in Malaysia to file an annual return. Generally, it is the responsibility of the company secretary to file an annual return. An annual return means the summary of your company’s profile that contains all of the important information about your business. Such information includes business address, office address, primary business activities, and general information about the directors and shareholders.

Malaysian law mandates organizations that offer various types of services to file their annual return. If the companies fail to file the annual return, they can face serious legal consequences, such as heavy penalties and even sanctions. Accounting firms in Malaysia help companies to file an annual return to ensure the smooth functioning of the business.

Hiring the services of a professional accounting firm in Malaysia has become necessary in most situations because an annual return is not a simple income tax return. In fact, it has different requirements and registration steps for various types of corporate entities. With the help of a competent and qualified company secretary and accounting firm, you will be able to streamline the process of filing the annual return.

2. When to File the Annual Return?

The Companies Act 2016 that has been enforced since January 2017, has separated the requirement of submitting financial statements from the submission of annual returns. Section 259 of the Companies Act 2016 makes it clear that the companies in Malaysia have to submit the financial statements and reports within 30 days from the anniversary of the incorporation date of the company.

On the other hand, section 68 of the Companies Act 2016 makes it mandatory for Malaysian companies to lodge their annual return with the Registrar of Companies (ROC) every year within a month from the anniversary of the incorporation date of the company. Therefore, the submission of the annual return is directly associated with the company’s incorporation date.

If you have hired a professional and competent company secretary, you should have no issue in following these deadlines because typically, it is the responsibility of the company secretary to file an annual return and make sure the company is in compliance with any other legal rules and regulations.

3. What is included in the Annual Return?

Under the Companies Act 2016, organizations in Malaysia have to submit the following things with their annual return:

Name, registration number, and registered office address of the company.
Type of company.
If the official records of the company are not kept at the registered address, then the other address must be provided.
Comprehensive details about all of the company directors, managers, shareholders, and secretaries.
Details about the shares held by particular company shareholders.
The entire process is digitalized, so companies can easily submit the forms and obtain a declaration from the MyCoID 2016 portal.

4. Penalties

Under section 340 of the Companies Act 2016, only public companies are required to hold the Annual General Meeting (AGM). On the other hand, it is no longer compulsory for Sdn Bhd to hold AGM each year. All of the company decisions can be made via circular resolutions without holding a physical meeting.

The Companies Act 2016 has greatly increased sanctions and penalties. If the company directors breach the Act, they can face up to 5 years of prison time or a fine of RM3 million or both.

5. Where to File an Annual Return?

Once all of the documents are prepared and the final annual return is ready, it has to be signed by a director or company secretary and submitted to the Companies Commission of Malaysia. The Companies Act 2016 states that the companies have to file annual returns within 30 days of the anniversary of the company incorporation date. The Registrar of Companies (ROC) will properly record and store these financial records of the companies in Malaysia.

2025 Update: MBRS 2.0 Mandatory for Annual Return Filing

Starting June 2025, all Malaysian companies must submit their Annual Returns through the My Government Reporting System (MBRS) 2.0. This update streamlines reporting via XBRL (eXtensible Business Reporting Language) and replaces manual filings entirely.

What’s New:

Filing must be done using MBRS mTool (offline tool for form generation)
All submissions require digital signature (e.g., eSignCloud)
No more physical forms or over-the-counter filing
Directors and company secretaries must be registered users on the MBRS portal

Tip: Familiarise yourself with MBRS early to avoid delays or rejections in 2025.

Annual Return Fee Breakdown (As of 2025)

Company Type	Annual Return Fee
Private Company (Sdn Bhd)	RM150
Public Company	RM500

Failing to file your Annual Return for 3 consecutive years may lead to company strike-off by SSM.

Annual Return Filing Timeline & Process (2025)

Step	Action	Estimated Time
1	Update company details via MBRS mTool	1 working day
2	Generate XBRL file & validate	1 working day
3	Upload to MBRS portal	1 working day
4	Digital signature by Company Secretary & Director	1 working day
5	Payment & submission confirmation	Immediate after upload
✅	Total Estimated Time	3–5 working days

Late Filing Penalties (Private & Public Companies)

Failing to file your Annual Return within the stipulated 30-day period from your incorporation anniversary may result in administrative penalties and statutory fines.

Late Lodgement Administrative Penalties (Private Company)

Delay After Due Date	Additional Penalty Fee
More than 7 days – 3 months	RM50
3 – 6 months	RM100
6 – 12 months	RM150
Over 12 months	RM200

Sample Checklist: Documents Required for Annual Return Filing

✅ Company Number
✅ Company Name
✅ Registered Office Address
✅ Principal Business Activities
✅ Shareholding Structure
✅ Company Secretary’s Information
✅ Digital Signature Tokens (from certified provider)
✅ Updated Financial Statements (if submitting together)

Mistakes to Avoid When Filing Your Annual Return

Submitting after the 30-day deadline
Using an outdated version of mTool
Not validating your XBRL files properly
Forgetting to apply the digital signature
Failing to appoint a certified company secretary

In a Nutshell

It is quite evident that filing an annual return is a critical responsibility of any company operating in Malaysia because not complying with this legal requirement can result in heavy penalties for the entire organization.

Therefore, it is highly important that you follow the procedures and deadlines discussed above to make sure you do not run into any kind of legal trouble and can run your business smoothly and efficiently.

For more information, feel free to get in touch with us.

Need Help Filing Your Annual Return?

ShineWing TY Teoh offers:

End-to-end MBRS filing support
Registered company secretaries
Annual compliance health check
Guidance on digital signatures and XBRL

Book a free consultation today

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Transfer Pricing and How it Affects Financial Reporting

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Post date March 12, 2021
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Transfer Pricing and How it Affects Financial Reporting

The concept of transfer pricing is highly important in companies that are operating as individual strategic units. However, there are many different challenges associated with transfer pricing in Malaysia, and it is crucial for companies to overcome these challenges to ensure the smooth and efficient functioning of the business.

The transfer pricing documentation becomes even more critical when an organization has various branches all around the world, especially in areas where the tax rates are continually fluctuating. The transfer pricing documentation is used as a tool to justify these transactions especially when transactions are carried with lower tax jurisdiction and could be misunderstood to have been carried out for tax benefits.

1. Relationship between Transfer Pricing and Financial Reporting

The relationship between transfer pricing documentation and financial reporting is heavily impacted by the uncertainties in the tax positions. International tax rules and regulations also impact the way transfer pricing is conducted and financial statements are prepared. As a result, multinational companies have to consider a variety of international jurisdictions and rules set by the global governing bodies.

Most of the surveys and studies indicate that developing countries are restricted in transfer pricing documentation due to a lack of resources. As a result, they are not able to effectively apply transfer pricing. However, most of the challenges of transfer pricing can be avoided by establishing suitable transfer prices for the intra-firm transfer of goods and services. In this way, proper payments are made, and the legal requirements of transfer pricing in Malaysia are also fulfilled.

2. Importance of Transfer Pricing in the Modern Era

Transfer price is now defined as the cost paid between two firms for the goods and services that are delivered by multiple entities or a consolidated organization. Nowadays, transfer pricing highly affects the way businesses do international trading. However, the process of preparing the documentation can greatly vary depending on the company’s structure and pricing basis.

3. Transfer Pricing and Tax Authorities

The law is clear that the prices charged by one entity to another in an intercompany transaction that could involve the trade of goods and services should yield consistent results as per the results that would have been produced if uncontrolled taxpayers were engaged in the same transaction in similar circumstances.

In other words, there are some strict guidelines that companies should follow in financial reporting of transfer pricing to make sure the transfer pricing documentation fulfils the legal requirements and is consistent with modern reporting standards.

The entire process of transfer pricing in Malaysia requires thorough documentation by professional regulators and auditors. If there is an error in the transfer value, then the accountants and auditors have to make sure that such changes are shown in the financial statements. Otherwise, there is a very high chance that you will run into legal issues with the authorities and might have to pay the penalty.

Despite the availability of such extensive data about transfer pricing in Malaysia, there is ambiguity around the working of transfer pricing in divisions and how the tax burden should be distributed among the various companies within a group.

In a Nutshell

Although there are many different aspects of transfer pricing and how it affects financial reporting, the following are the three main key points that every auditor should keep in mind for transfer pricing documentation:

Multinational organizations have to pay special attention to transfer pricing because it carries a great tax-compliance risk. If proper tax planning and financial reporting are not performed, companies can face serious legal issues.
The arm’s-length transfer price is generally identified from the areas that create and transfer the value. For instance, factors like risks and assets are analyzed to apply a suitable economic method of transfer pricing in Malaysia.
Transfer pricing provides a significant number of benefits to multinational corporations. However, there is a lot of ambiguity attached to these tax benefits. As a result, it is important that companies ensure that proper transfer pricing documentation is prepared and ensure maximum compliance with the rules and regulations.

For more information about transfer pricing, feel free to get in touch with us.

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Seven Ways to Manage a Payroll System Effectively

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Post date January 25, 2021
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Seven Ways to Manage a Payroll System Effectively

Payroll management is one of the most important aspects of any type of business and organization. The business owners and HR department need to have a smooth and reliable payroll system so that work is performed accurately and timely. However, payroll management is a complex task because a lot of different aspects need to be considered while managing a payroll system.

Undoubtedly, many HR managers are not familiar with the best practices of executing payroll processes. In this article, we are pleased to share the top seven ways to manage a payroll system effectively.

1. Organizing

Organizing is the key to maximizing the efficiency of your payroll system. When you are dealing with a variety of data and financial numbers, the HR department should make sure that all of the information and financial reports are properly organized.

Such organization strategies include developing a comprehensive payroll calendar to keep track of the important deadlines and make sure all of the required forms and payroll taxes are submitted on time.

Moreover, such tasks should be divided into sub-tasks, like distributing bonuses or other compensation to the employees. In this way, the payroll and HR services will be streamlined.

2. Use Modern Tools and Technologies

There is a wide range of payroll management systems available in the market. Most of this software is quite similar to each other. However, you should evaluate your own company’s requirements to make sure you are implementing the best suitable software and tools to make the entire payroll management more efficient.

Such modern tools allow you to handle functions like employee attendance, forms, compensation details, and many others.

3. Fulfil Legal Requirements

Generally, all of the important details about particular payroll processes are given in Malaysian Law. If you want to maximize the efficiency of your business, you should make sure that you comply with all of the legal requirements. Moreover, you should keep in mind that the payroll-related legislation keeps changing.

If you hire the services of a professional accounting firm in Malaysia, you will not have to worry about such changes because they will be fully covered by the firm.

4. Standardization

A major issue associated with payroll systems is that many companies make the mistake of not implementing standard practices. As a result, the entire payroll and HR services are disturbed because everyone keeps changing the processes as per their convenience.

This kind of issue is quite easy to solve. All you have to do is make sure that payroll management is streamlined by implementing the best payroll practices. In this way, the managers and the staff will be well-familiar with the way they have to deal with payroll and HR services.

5. Outsource Payroll System

Perhaps, the most important way of effectively managing a payroll system is to outsource your payroll management to an accounting firm. There are numerous benefits to outsourcing your payroll system. It will streamline the payroll and HR services of your company.

It will help your entire company because qualified and competent individuals will be managing the payroll processes, making sure that all of the important payroll tasks are being fulfilled in an efficient and timely manner.

6. Automation

Undoubtedly, payroll management is a time-consuming task. If you perform payroll processes manually, it will take a lot of time, money, and energy. Moreover, there is a greater chance of missing some important deadlines that can result in penalties. On the other hand, if you automate most of your payroll processes, you can easily keep up with the deadlines and make the process more efficient.

7. Distribute Duties

There are many different tasks and responsibilities that are part of the payroll and HR services. You should distribute such duties in a fair and transparent manner to make sure every member of your organization is able to contribute to your company.

You should also consider dividing payroll tasks into sub-tasks and distribute them equally among your employees to make sure all of the tasks are being performed within the deadlines.

In a Nutshell

In the end, you should remember that payroll management is a challenging task for most companies. Nobody expects you to take care of the entire payroll system by yourself.

If you choose to outsource your payroll system to an accounting firm in Malaysia, you can make sure that the experts handle the payroll and HR services to enhance the efficiency and productivity of your entire business.

For more information, feel free to get in touch with us.

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Auditing in 2021: Planning for the year ahead

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Post date January 25, 2021
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Auditing in 2021: Planning for the year ahead

The COVID-19 pandemic has drastically changed the structure of most business processes around the world. As a result, there are many new challenges and aspects that you have to consider in auditing in 2021. The audit firms in Malaysia are also altering their audit and accounting services to make sure auditing is performed without any errors and hassles.

The peer-review process has always been a challenging part of auditing. However, audit planning has become more difficult in 2021. Following are some important tips that you should follow to ensure smooth and reliable auditing in 2021.

1. Removing Common Errors

According to a survey, most audits fail because they do not comply with the common rules and regulations. Therefore, it is important that you get professional accounting services in Malaysia so that you can avoid such mistakes and perform auditing as per the best practices.

A major part of these audits is the identification of specific risks. If you are getting the services of an accounting firm, make sure that the entire company is thoroughly analyzed, and all of the essential information is properly documented.

Moreover, identifying risks in 2021 also involves considering the impact of the pandemic on the global supply chain and the overall finances of a company. The purpose of evaluating these factors is to adjust the audit processes as per the new standards.

2. Comprehensive Discussions

It is now more important than ever that companies and audit firms conduct thorough analysis and discussions about the changes that have to be made to the audit process while planning for it. Such steps include the analysis of internal and external risks.

The primary issue that most companies suffer from is the lack of information or documentation. Generally, companies that have consistent accounting services in Malaysia are able to streamline this process because they compiled all of the important information in the form of quarterly and monthly financial reports.

Experts also agree that robust planning meetings are the key to ensuring a smooth audit in 2021. When it comes to conducting a smooth and efficient audit, planning is everything. Therefore, companies need to spend a considerable amount of time on this stage to make sure all of the risks are considered before moving on towards the actual auditing stage.

3. New Risks

It is important to note that the risks associated with auditing in 2021 can greatly vary from company to company due to a lot of factors. Once you hire the services of an audit firm, they will thoroughly evaluate the type of your business processes and come up with an effective auditing plan. Generally, the current situation has greatly increased the uncertainties in auditing. Therefore, organizations have to make sure that all of the different aspects are fully covered in auditing to ensure its success.

Following are some of the proactive measures that can be implemented to reduce the risk associated with auditing in 2021:

Evaluate the current practices to identify and respond to any kind of possible employee disengagement.
Assess the overall progress on the company’s goals and development plans.
Reevaluate the talent risk-mitigation strategies after considering the impact of the pandemic on the business and staff.
Ensure that the senior management and HR department is fully-equipped and trained to implement modern tools and technologies to work in unprecedented situations like remote working, and proper plans have been put in place for such circumstances.
Assess the feasibility of the current business processes and evaluate their benefits to determine any changes that have to be made in 2021.
Ensure fairness and transparency in the organization by sharing and discussing important information with the employees and the managers to make sure all of the important organizational changes are properly communicated.

In a Nutshell

There is no doubt that auditing is one of the most important parts of any business. The challenges in auditing have increased in 2021, but companies can easily plan for it with the help of professional accounting and audit services in Malaysia. By considering the strategies discussed above, the organizations should have no major issue in conducting a reliable and efficient audit.

Since the pandemic is still a developing situation, it is necessary that companies keep visiting their audit planning to ensure that all of the changes are covered. This will ultimately result in the successful auditing of your company. For more information, feel free to get in touch with us.

The bottom line is that whether you are running a homegrown group of companies or a multinational enterprise, transfer pricing documentation must be prepared if you are involved in related party transactions. The tax authorities have in recent years made significant changes to the penalty rates, which shows their serious attempts in ensuring that companies comply with the law, especially in regards to Transfer Pricing.

For more information, feel free to get in touch with us.

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How Does Transfer Pricing Benefit Your Business?

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Post date December 25, 2020
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How Does Transfer Pricing Benefit Your Business?

Transfer pricing refers to the rules and methods of trade between two companies under common ownership or control. Transfer pricing documentation is a highly important procedure because it provides the company with an avenue to detail out the company’s background, functions, and related party transactions, including pricing and strategy.

When the documentation is prepared early, it saves a significant amount of time and manpower when the documentation is requested by the tax authorities for submission.

Since transfer pricing has various impacts on an organization and its Group, it is important to review the transfer pricing strategy and documentation to make sure maximum transparency is present all across the business and international trading.

Benefits of Transfer Pricing

Professional accounting services in Malaysia can help organizations in preparing reliable transfer pricing documentation. Following are some of the many benefits of transfer pricing:

Transfer pricing enables multinational corporations to gain profits individually for all the divisions/entities/subsidiaries they have.
Transfer pricing is also beneficial for large-scale organizations to determine the performance and progress of each division or subsidiary separately. As a result, they can develop suitable strategies to enhance performance in a more targeted way.
Apart from compiling the reported profits of each division or subsidiary, transfer pricing documentation is also important for organizations to allocate resources while evaluating the overall cost of each division or subsidiary.
A multinational organization often consists of several legal entities. In such a situation, transfer pricing plays a critical role in allocating the profits to the entire organization (including the separate entities) by considering the tax liabilities in various countries.
Transfer pricing documentation enables organizations to set the price among different division or subsidiary.
Transfer pricing documentation is a legal and reliable method of getting tax advantages for multinational organizations.
Organizations can ensure profits are generated for offering goods and services in various countries that have a lower tax rate.
A major advantage of transfer pricing documentation for organizations is that it helps in reducing duty cost. As a result, organizations are able to ship goods to high-tariff countries at minimum transfer prices and pay a lower duty base.

1. Compliance

International trading can be quite tricky, especially when a large-scale organization and its entities are operating in multiple countries at the same time. There is a wide range of rules and regulations that have to be considered during this process.

However, if an organization and its entities in different countries have a reliable strategy in place for transfer pricing documentation, they can avoid heavy fees and penalties. This process will make sure that the organization is complying with the rules and regulations. As a result, the organization will be able to run smoothly and efficiently without running into any legal hassle.

2. Performance Evaluation

A transfer pricing documentation allows organizations to evaluate their profits against other players in the same industry. In fact, the purpose of evaluating the profits is to track the progress of the organization and compare them with major competitors. If the organization is making lower profits, then it should consider making some changes in the business processes.

Other than evaluating the performance of an organization as a whole entity, transfer pricing documentation is also helpful in evaluating the performance of each division or subsidiary of the organization. Moreover, it enables the business owners, managers, and supervisors to target the areas that are not performing up to their expectations and make suitable changes to enhance productivity and efficiency.

In short, with transfer pricing documentation, organizations are able to evaluate their performance and determine whether any changes and adjustments are necessary to enhance performance.

3. Allocation of profits

The fact that different legal entities can be owned by a single corporation makes it important to prepare a thorough transfer pricing documentation. For organizations that engage an accounting service in Malaysia, the accountants will study all of the branches of the organization and ensure that the allocation of profits across the group is done appropriately.

It essentially facilitates organizations to set a suitable price among their Group members.

In a Nutshell

The tax authorities have in recent years made significant changes to the penalty rates, which shows their serious attempts in ensuring that companies comply with the law, especially in regards to Transfer Pricing.

For more information, feel free to get in touch with us.

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How To Hire a New Company Secretary in Malaysia?

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Post date December 25, 2020
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How To Hire a New Company Secretary in Malaysia?

There are situations in which you might not be completely satisfied with the services you are getting from your existing company secretary in Malaysia.

In this case, changing your company secretary should not be difficult if you are familiar with the rules and regulations associated with hiring and replacing the company secretary.

The Companies Act makes it compulsory for every company in Malaysia to appoint at least one company secretary to fulfil various company responsibilities.

It is quite common for companies in Malaysia to change their company secretary.

In general, here are some of the common reasons why companies should consider changing their company secretary:

The company secretary is not providing documents like meeting agendas in a timely manner.
The company’s directors and stakeholders are not being reminded about the deadlines of different agendas and tasks.
The company secretary is providing inaccurate or unreliable advice.
The company is paying too much service fees for substandard services.

The following are some of the important factors that you should consider while changing the company secretary:

A. Powers of the Board of Directors

The board of directors takes the final decision about the appointment of the company secretary. Similarly, it has the power of removing the company secretary at any time. However, this decision must be taken after careful consideration and ensuring compliance with the law and the company’s constitution.

Generally, the process starts when the board of directors ask to terminate the services of the company secretary. Next, the company will have 30 days to hire a new company secretary. If the office of a company secretary is left vacant for more than 30 days, the company can be liable for a fine of about RM50,000.

B. Quick Appointment

In order to avoid the fine and other legal issues, most companies remove the existing company secretary and hire a new one simultaneously. As a result, the board of directors is able to meet the deadline of 30 days and ensure smooth functioning of the business as the company secretary will start fulfilling their responsibilities immediately.

It is important that before the company initiates the process of changing the company secretary, the board of directors find a suitable candidate for the job and discuss with him or her about the job requirements and the reasons for changing the previous company secretary.

In this way, the company will be able to make sure that the new company secretary fulfils the general responsibilities and avoid the unpleasant experience with the previous company secretary.

C. Documents Preparation

In order to legally change the company secretary, you will have to prepare certain documents to appoint a new company secretary and change the information of the company. It is the new company secretary’s responsibility to submit the required documents to the relevant authorities and gather all of the essential information and company documents from the current secretary.

Preparing the relevant documents can be challenging for a lot of companies, especially ones that are not familiar with this process. Such companies can rely on the professional services provided by accounting firms in Malaysia who have years of experience in dealing with such matters.

Recommendation

It is highly recommended that you change your company secretary after important deadlines such as tax filings and company registration. If you choose to initiate this process in the middle of significant deadlines, you can end up getting involved in legal and compliance issues.

In a Nutshell

There is no denying a company secretary plays an important role in most companies. This is especially true in Malaysia, where companies can be fined for not hiring a company secretary within 30 days of company incorporation.

Therefore, it’s strongly recommended for companies to pay special attention to the factors discussed above to ensure the process of hiring a new company secretary is smooth, efficient, and successful.

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Important Things to Consider for Your Year-End Transfer Pricing Documents

Post author By admin
Post date December 25, 2020
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Important Things to Consider for Your Year-End Transfer Pricing Document

It is important for companies, especially large organizations to perform a comprehensive year-end financial review and prepare an accurate and reliable transfer pricing document in Malaysia. Whether the review takes place at the end of December, June, or any other month, it must be performed with utmost care and professionalism so that the transfer pricing document is reliable.

An annual review is also important to perform transfer pricing risk assessment and determine if you need to make any significant changes to the transfer pricing process. There are different aspects that you must consider during this process. Keep reading to learn about these important factors:

1. Review Intercompany Transactions

It is crucial to review the intercompany transactions to evaluate the volume and cost of each transaction. Moreover, any significant errors should be removed in this review. If your company has made any new transactions during this process, you should add them in as well.

Generally, it is highly recommended that you get professional accounting services for a thorough review and the preparation of transfer pricing documents.

2. Financial Results

Companies have to review their financial condition on a daily basis. It includes reviewing the company’s financial records and statements. You should start this process by analyzing the financial involvement in any transactions with the related parties.

It also includes determining whether you have met your yearly financial goals. Transfer pricing adjustments have to be made if the inter-company pricing is not within the arm’s length range.

3. Adjustments

Generally, start-ups and small businesses will not have to make transfer pricing adjustments. However, large companies and multinational enterprises have to consider making transfer pricing adjustments due to the complexity of the intercompany transactions.

If you think that adjustments are required, then you will have to determine the amount and find out about any relevant rules and regulations that are applicable to that transaction.

Professionals who have years of experience in dealing with transfer pricing in Malaysia will be able to evaluate suitable adjustments easily.

4. Update Agreements

5. Best Practices for Adjustments

There is no one specific year-end adjustment method that can be applied to all types of intercompany transactions. Instead, companies and transfer pricing experts in Malaysia have to spend a considerable amount of time and resources on determining the local transfer pricing rules and best practices.

With thorough research and careful considerations, companies will be able to come up with a reliable transfer pricing policy that will not lead to any severe regulatory risk or an expensive failure.

Moreover, it is important for the companies to make sure that all of the transactions are as per the arm’s length principle. Moreover, the policy should be flexible enough to accommodate future adjustments as there are situations in which you will have to make further adjustments and update the transfer pricing document.

6. Internal Control System

There is no denying that companies that have designed and implemented an effective internal control system for transfer pricing in Malaysia enjoy more responsiveness and reliability in preparing transfer pricing documents.

While there is no single method that can be applied to all types of companies, there are some tried-and-tested practices of transfer pricing documentation that should be applied by the companies. Businesses have to assess potential deviations from the arm’s length principle on the basis of each transaction.

In this way, they will be able to choose the most suitable method of adjustment.

The importance of an effective internal control system is enhanced by the fact that it facilitates companies in avoiding regulatory issues from the government agencies.

In a Nutshell

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5 Things to Figure Out Before Registering a Sdn Bhd Company in Malaysia

Post author By admin
Post date December 25, 2020
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5 Things to Figure Out Before Registering a Sdn Bhd Company in Malaysia

If you are thinking about starting a business in Malaysia, it’s a good idea to first get familiar with the Malaysian company registration process to ensure you are choosing the right type of company for your business.

Generally, a Sendirian Berhad (Sdn Bhd) is the most common type of business entity in Malaysia. It is a legal business entity in which the liability is limited by shares. A Sdn Bhd company is essentially incorporated as a private company with the words Sdn Bhd written with the company’s name.

In this guide, we’ll walk you through the five key things you need to know before registering a Sdn Bhd company in Malaysia.

1. Choosing the Right Company Name

It is important for you to follow the rules and regulations while deciding the proposed company names. Companies Commission of Malaysia suggests the following guidelines for choosing a suitable company name:

Names should not be misleading, offensive, or blasphemous.
Avoid names that suggest a connection with the royal family, government, or authorities.
The name must reflect the nature of your business.
It should not resemble an existing registered company.
Certain activities, such as insurance or banking, require prior approval before being used in a company name.

The name of any business plays a critical role in its success, so it is very important that you spend a considerable amount of time to carefully choose a suitable name for your company. All of the relevant details have to be explained in the incorporation form. A strong company name not only ensures compliance but also plays a vital role in your branding and long-term success.

2. Defining the Nature of Your Business (MSIC Code)

When registering your Sdn Bhd, you’ll need to specify the nature of your business under the Malaysian Standard Industrial Classification (MSIC) code.

If you are unsure of which code applies, it’s best to consult a company secretary or seek guidance from an accounting services provider in Malaysia. This ensures accuracy during registration and avoids delays.

3. Business Address vs. Registered Address

When you are registering a Sdn Bhd company in Malaysia, you need a business address and registered address. Both of these addresses do not have to be the same. Generally, a business address is a location where the business activities are taking place.

A Sdn Bhd company in Malaysia must have both a business address and a registered address:

Business Address → The location where day-to-day business operations take place.
Registered Address → The official address (usually your company secretary’s office) where legal documents and government correspondence are sent.

On the other hand, a registered address is typically the office of the company secretary where communication related to the company is handled.

4. Company Directors and Shareholders Requirements

Directors and shareholders play important roles in a Sdn Bhd company in Malaysia. When registering a company in Malaysia, you should make sure the potential shareholders and directors are meeting the eligibility criteria set by the law.

The eligibility criteria for being a company director in Malaysia are:

Both Malaysians and foreigners can become the sole director of a Sdn Bhd company in Malaysia.
The age of the company director must be at least 18 years.
Director should be residing in Malaysia.
The candidate should not be disqualified as per section 198 of the Companies Act 2016.

For shareholders:

A Sdn Bhd can have up to 50 shareholders.
Shares are issued based on the company’s paid-up capital.
Shareholders must deposit their share value into the company’s bank account once incorporation is completed.

If you are a foreigner who does not live in Malaysia, then it is necessary for you to hire at least one resident director for your Sdn Bhd company.

On the other hand, a Sdn Bhd company in Malaysia can have up to 50 shareholders. The shares held by each shareholder are declared during the company registration process.

Similarly, the value of each share is evaluated on the basis of the total capital of the business. Once the company has fully registered as Sdn Bhd in Malaysia, the shareholders will transfer the amount into the business bank account according to the number of shares they have in the company.

5. Paid-Up Capital Requirement

To register a Sdn Bhd in Malaysia, you must have at least RM1 as paid-up capital. The declared capital must be genuine and available at the time of registration — it is illegal to declare capital that does not exist.

In practice, many businesses declare higher amounts (e.g., RM1,000 or RM10,000) to build credibility with banks, suppliers, and clients. A professional corporate services provider can advise on the appropriate paid-up capital for your business needs.

Frequently Asked Questions (FAQ) About Registering Company in Malaysia

How much does it cost to register a Sdn Bhd company in Malaysia?

The cost varies depending on professional fees and statutory charges. On average, it ranges between RM1,000 – RM3,000.

Can a foreigner register a Sdn Bhd company in Malaysia?

Yes, foreigners can register a Sdn Bhd, but at least one director must be a Malaysian resident.

How long does it take to register a Sdn Bhd?

With proper documentation, the process can be completed within 5–10 working days.

What documents are required to register a Sdn Bhd?

Typically, you will need:

Proposed company name
Details of directors and shareholders
Copy of IC/passport
Registered office address
Paid-up capital details

Why should I hire professionals to assist with company registration?

Working with an experienced firm like ShineWing TY TEOH ensures compliance with the Companies Act 2016, accurate documentation, and a smooth registration process.

In a Nutshell

These are some of the most important factors that you should consider while registering a Sdn Bhd company in Malaysia. The Companies Act 2016 gives extensive details about the dos and don’ts of company registration.

If you choose to rely on professional services provided by accounting firms in Malaysia, the entire registration process will become easy and efficient.