FIDDLE OR NOT TO FIDDLE

Intro:

Once upon a time, there is a company named YBLC Ltd., Foreign Investment Company
located at Antu in North East China. PPLC Ltd. Malaysian Company provide lumber business
in East Malaysia. PPLC Ltd set up a joint venture with YBLC Ltd. in Antu to exploit the Pine
timber resources. YBLC Ltd. send their foreign engineer, marketing manager, financial
controller in Antu.

One day Ms. Lee pressure the GM Ms. Zhang to ask FC Ms T to alter the profit & loss
position of the financial statements.

In the GM Office

Ms. Z: Morning EO, Lee. How are u this morning? Please have a sit tea?

Ms. L: No thanks belagak-

Ms. Z: why you come in my office , whats the matter?

Ms. L: I have an urgent favor to ask from you GM Z.

Ms. Z: Yeah, go on.

Ms. L: I heard that last year financial report has been finalized.

Ms. Z: Yes, why?

Ms. L: And we making a loss again?

Ms. Z: Yes, it was shown in the draft copy of the account FC Tee gave me.

Ms. L: I cannot accept that financial result. belagak-

Ms. Z: But Why? We are into the 2nd year operation. Losing 2 years in a row is quite common
for a new company

Ms. L: I know, but my superior asked me why all joint venture companies under me are not
making money!!!!!!!!!!!

Ms. Z: EO Lee, please calm down. We have been together all this year and you know we
have doing our best. FC Tee said we made a loss because we have not been getting
sufficient logs to feed into operations. Our factory is still operating under capacity.

Devil: HA HA. ARE U SURE U CAN TRUST THE FOREIGN ACCOUNTANT? WHY U
MUST TRUST HER. SHE IS AN OUTSIDER TO YOU!! SHE MUST HAVE SOME HIDDEN
AGENDA.

Ms. L: Come on GM Zhang. I have enough of that FC Tee. can u trust that foreign
accountant? They are all the same, they like to make an account showing a loss, to avoid
paying tax. (Credibility/ Cross culture mgt)

Devil: Cmoonnnnnnn Lee, everyone is selfish in their own ways there must be
something that Tee get for what he done. Besides bank manager said there is
plenty of cash in the account
Ms. L: and our bank manager said that there is plenty of cash in the account!!!!!

Ms. Z: What u said its true EO lee but I had heard these foreign accountants have to follow
rules which is IAS .

Angel : Its true lee, that accountant must follow that rules to make sure she
suggest that financial statements are factually correct , do not contain any
material misstatements that may mislead the users and fair implies which
represent the information faithfully without any element of bias and reflect the
economic substance of transactions .

Devil: Nonsense Lee, Nonsense

Ms. L: So what are you saying is we dont have accounting standard in China? My friend in
China said account can be changed easily besides I have promised my superior to make a
profit last year.

Devil: U will lose face if you give another bad report card Lee!!!

Angel: No Lee, According to MCCG as Director u must establish a corporate

culture which creates ethical conduct that fills throughout the company. The
board needs to formalize and commit to ethical values through a code of conduct
and ensure the implementation of appropriate internal systems to support,
promote and ensure its compliance.

Ms. Z: EO Lee this may not be as easy as u think

Ms. L: Cmonnnn GM Z. Am I not done enough for the company? I spend most of my time
and energy for this company. This is the least u can do this for me?

Angel: Hey Lee, according to Section 198(1)(C) of Company Act 2016, if the
person have been convicted of an offence involving bribery, fraud or dishonesty it
may disqualified as director of the company

Devil: Ah! Shut up u angel. Hey Lee if u kept it secret, the authority will not find
it.

Ms. Z: Alright EO Lee, I will talk to FC Tee this afternoon

Ms. L: You better do that (HEMPAS MEJA KEADAAN MARAH)

Narrator: At the GM office in the afternoon..

Ms. T: Good afternoon Ms Z

Ms. Z: I have some urgent matter to discuss with u, please have a sit, coffee?

Ms. T: no thanks. How can I help u (Muka Kerut Kerut)

Ms. Z: What do u think of EO Lee as a person? (ckp slow slow)

Ms. T: She is a helpful person. Why?

Ms. Z: What I mean is, is she helpful to the company?

Ms. T: Yes. I give him credit for helping with the company registration matters

Ms. Z: Im glad you remember all the good things he had done for the company.

Ms. T: Yes. So what does he want?

Ms. Z: He wants you to do a small favor for him? (Bribery)

Devil: whatever it is U need to help her after all she had done for u. after all you
also can gain something for her

Angel: No Tee, it looks like bribery. Dont you remember one of the bribery case
which government officers had been arrested due to accepting bribe amounting
RM 25,000 in Malaysia. This action will damage your image as professional
accountant.

Ms. Z: She wants you to change the P&L to show a profit, so that she can show that she has
turned the company to profitable state.

Devil: Come on Tee, u should do that. U can get HUGEEEEE reward for that.

Angel: This is not right. This is creative accounting, since she wants U to getting
creative with the income statement. As u can see from the case International
Business Machine Corp (IBM) 1999 interim report amounted $4 billion in gains on
an investment against selling, general and administrative expense. So the
company reported an impression that recurring operating expenses were being
reduced. So Tee, do you want to be one of them?

Ms. T: Why would he want to do that?

Ms. Z: Probably for her good report card to get fast promotion. (Conflict of interest)

Devil: U should definitely help her, so that U can get fast promotion.

Angel: According to section 218 of companies act 2016, a director or officer of the
company shall not without the consent or ratification of a general meeting engage
in business which is in competition with the company to gain directly or indirectly
a benefit for himself or any other person or cause damaged to the company

Ms. T: It is not that we do not want to help her in her career but I have International
Accounting standard and Malaysian Accounting standard which I have to obey. Overseas
market expected remain strong, we maybe in our way to substantial profits in this year.
(Integrity of accountant)

Angel: Thats true Tee. According to MIA By Laws under section 110 (1), all
professional accountants to be straightforward and honest in all professional and
business relationships. Integrity also implies fair dealing and truthfulness.

Ms. Z: I am afraid he cant. He seems very adamant with his demands.

Angel: dont do that. Do u remember about Enron and Arthur Anderson case, the
company is now closed due to the falsifying the P&L. As a General Manager you
should know how to implement a good cooperate governance.

Ms. T: As accountant I must show a true and fair view of the affairs of the company. So I also
have accounting bodys code of practice to uphold. I may lose my practice licensed if I
change accounting report without basis.

Ms. Z: if u dont help her we may lose a very ally on the government side. Can u at least look
into the accounting standards and see if u can change it to slight profit? (Independence of
Mind)

Angel: No zhang, u should not asked that because by referring MIA By Laws
under section 291 (5), u must not affected by influences that compromise
professional judgment, thereby allowing an individual to act with integrity and
exercise objectivity and professional skepticism.

Ms. T: But I can tell u the probability of doing so is very low. Besides, I may to inform my boss
in the HQ about it.

Devil: no you should not involve your boss in HQ, this is because you can asked
them for reward for what you do. Come on Tee, for how long you want to be the
worker? Dont you ever dream to be the boss?

Angel: No Tee, According to MIA by Law, if there is any threat to compliance with
the fundamental principles, the you need exercise professional judgement and
take into account whether reasonable an inform third party such that compliance
with the fundamental principle is not compromise.

Ms. Z: Please do not involve your HQ people. If you can help, help in personal capacity.