Training Workshop for Lavastorm Analytics

The Accounting Research Institute (ARI) has recently purchased a software called Lavastorm Analytics  information system(LA).  Although LA is in itself represents an integrated data management system, ARI acquired the software to firstly manage its research data more effectively.  Secondly, LA is
specifically used to facilitate its researchers and clients to maximize their competency in data mining typically  for financial fraud detection purposes.  Essentially, LA is a new, agile way to analyze, optimize and control data and processes.  ARI organizes a three-day training workshop with the aim of learning more about the software and its potential use.  LA supplier sends its experts Michael and Aaron to facilitate the training workshop.   As in learning anything new, the learning curve  among participants was initially slow.  But later in the afternoon, participants were introduced with  tools that can be used to identify potential red flags in financial fraud data.  We learned the need to first and foremost to clean the data.  Very often, financial fraud investigators are challenged with voluminous data that must be sorted out before any investigation could take place.  Lavastorm is part of the facility and tool made available at the recently built Forensic Accounting and Polygraph Laboratory.

Bahasa Malaysia Version of CISM

The Malaysian Institute of Integrity (IIM) took the initiative to translate the "Corporate Integrity Assessment Questionnaire - CIAQ" into the Malay Language or Bahasa Malaysia (BM).  This is in view of the increasing need of using the BM version of the instrument among  public sector organisations.  The instrument has been professionally translated by the Malaysian Institute of Translation (ITN).  On the second day of IIM's 2-day workshop, participants were tasked to review the translation and were given the opportunity to further improve its contents.   Since it is a translation, participants were reminded that the contents should mirror the original's English version.  Two leading academics from Universiti Sains Malaysia (USM)  were tasked to lead the discussion.  Prof Dr Ishak and Prof Dr Hasnah were part of the Steering Committee that developed the CIAQ in 2010.  The Accounting Research Institute (ARI) sent the Head of the Corporate Integrity System Research Cluster, Associate Professor Dr Jamaliah and her team members to the event.  At the end of the second day, the group has unanimously endorsed the instrument.

CISM Stakeholders Outreach Program

The Malaysian Institute of Integrity (IIM) organizes its two-day outreach program, meeting and discussing with stakeholders on the issues of corporate integrity system Malaysia (CISM).  Recently, the Malaysian Government announced on the need of public sector organizations to set up their integrity unit or department.  In support of IIM's drive to promote corporate integrity at workplaces, the Accounting Research Institute (ARI) has established a research cluster called "Corporate Integrity System Research Cluster".  ARI researchers, together with a few other academics from Universiti Sains Malaysia, INCEIF and Nottingham University (Malaysia campus) helped to develop an instrument to assess corporate integrity at workplaces.  Known as "Corporate Integrity Assessment Questionnaire or CIAQ", public and private organisations in Malaysia can do their own assessment.  To ensure effectiveness, the questionnaire needs to be filled by between 30-50 respondents, comprising employees of various management levels.  Today, IIM organizes a two-day outreach program to explain the CIAQ instrument to various stakeholders of public and private organisations.  ARI director, Professor Dr Normah Omar and Dr Salleh Hassan from SIDC have been tasked to share the findings of two organisations who participated in the Corporate Integrity System assessment.  A total of fifty participants attended the event.

Publication Workshop by FC Research Cluster

A three day publication workshop entitled ‘Prioritizing Publication in Indexed Journals’ was held from 26^th – 28^th July 2013 in Selesa Beach Resort, Port Dickson, Negeri Sembilan. The workshop was intended for Financial Criminology-fraud indicators research cluster, which is headed by Associate Professor Dr Zuraidah  Mohd Sanusi (Deputy Director of ARI).  The workshop provides an avenue for researchers to discuss working papers in the field of financial criminology research, aiming to improve academic writing and making it ready for publication in indexed journals. This workshop achieved its purposes with attendees of 21 researchers and research assistants who have worked on more than ten papers to be published in SCOPUS/ERA indexed journals. The areas of studies includes fraud detection, internal control, audit quality, corporate governance, Shariah compliance companies, fraud incidents in banking, fraud risk in government agencies, government linked companies and earnings management.  

ARI’s staff also held their own workgroup to update research information for ARI’s database during the 3-day event. The database system developed by Dr Intan Salwani Mohamad (ARI’s fellow), has facilitated the requirement and expectations of MOHE towards ARI’s research grant achievement. Among the staff involved are Wan Mariati Wan Omar, Munirah Morad, Aziah Nasir, Hamidah Awal, Zamzarina Jaini and Farhana Alaei. They have collected information and evidence for all ARI activities up to June 2013. ARI needs to continue this high spirit to be more efficient despite of the challenge in the fasting month of Ramadhan.

Corporate Integrity Self Assessment Questionnaire

As one of the leading Government-Linked Companies (GLC), Tenaga Nasional Berhad (TNB) has taken initiative to self-assess the company's Corporate Integrity System.   TNB signed the Corporate Integrity Pledge (CIP) on 26th July 2011.  CIP is essentially a collaborative effort between Malaysian Institute of Integrity (IIM), Malaysian Anti-Corruption Commission (MACC), Performance Management Delivery Unit (PEMANDU) of the Prime Minister's Department.  In its pledge, TNB promises that it shall :

• not, through any of its employees, representatives or agents, commit any corruption offence under any law, such as the MACC Act 2009 or Penal Code;
• not conduct any business practices or activities that would require or encourage any of its employees, representatives or agents to commit such offences; and
• work together with its business partners, regulators and law enforcement agencies to create a business environment that is free from corruption,
• uphold the TNB’s Corporate Integrity Principles in Malaysia in the conduct of its business and in its interactions with its business partners and the Government; and
• shall take strict action against any party who tarnishes the integrity and the company’s image.

In line with the CIP, TNB has volunteered to participate in IIM's Corporate Integrity Self Assessment Questionnaire (CIAQ).  Through CIAQ, companies can assess their corporate integrity's current "benchmark level".  CIAQ comprises 12 dimensions supported by related 214 descriptors.   A 0% level implicates that "No ethics and integrity work has begun". A 25% level describes a "compliance mindset with symbolic action only. A 50% level signifies the "beginning of a programmatic thrust and the company is moving in a healthy direction".  At 75% level, a company is "seeing ethics and integrity systematically using a robust ethics and integrity approach".  Finally a company at 100%  level becomes a benchmark for its best practices in ethics and integrity.  The Accounting Research Institute (ARI) has been assigned the task of assessing those companies who have volunteered to participate in the CIAQ program.   Today, the researchers from ARI met up with officers from both IIM and TNB to present the preliminary findings of the CIAQ survey.

LRGS Experience

One of the most competitive research grant schemes in Malaysia is the "Long Term Research Grant Scheme or LRGS".   Basically, LRGS focuses on fundamental research that aims towards producing cutting edge ideas and solution to existing issues. Preferably, those interested to apply for LRGS must find a "niche" that is strategically aligned with the country's research and development agenda.  For 2013, the Ministry of Education has identified several research niche areas.  This includes topics such as : Global Warming, Infectious Diseases, Tropical Medicine, Energy and Water safety, Food Self-Sufficiency, Advanced Technology & Value Added, ICT, Halal Food,  Wakaf Financing and Youth Issues.  In developing their research proposals, researchers of a particular university need to include other researchers from at least two universities into their research team.  Researchers then prepare a concept paper outlining their research program.  Usually, each research program is supported by several integrated research projects.  The concept papers are reviewed by a panel of experts and those selected will be invited to prepare a more

comprehensive proposal.  The research teams are invited to present their proposals to a larger panel members.  At this point, only a few good proposals will be invited to prepare a full proposal.  Again, the full proposal will be further evaluated by the panels.  Only those whose proposals are approved at this level will be recommended for LRGS funding.  ARI Director, Professor Dr Normah Omar has been appointed as an assessor for both  the preliminary round as well as at the final stage of LRGS evaluation.  

BOS at the weekend

Prof Dr Normah Omar, Director of the Accounting Research Institute (ARI) has been invited to participate in a Blue Ocean Strategy (BOS) for the university.  In essence, a BOS focuses on some very interesting concepts such as (i) create uncontested market space; (ii) make competition irrelevant; (iii) create and capture new demand; (iv) create the value-cost trade off and (v) align the whole system of an organisation's activities in pursuit of differentiation and low cost.  Interestingly, a group of students representing the students Council (MPP) were also  invited to participate.  Some sixty value innovations identified in earlier workshop were deliberated.  Some of the value innovations proposed and discussed by/with the students include (i) U-Job, (ii) Not just affirmative action (iii)  Stakeholder satisfaction (iv) Flexible Break Hours and (v) Edutainment Library.  

Congratulations Dr Sharifah Norzehan

The Accounting Research Institute (ARI) congratulates one of our research associates, Dr Sharifah Norzehan Syed Yusof for winning the  Yayasan Nurul Yaqeen's Best Thesis Award for her PhD thesis with the central theme of the 'Islamic World View'.  In the grand final competition, this lecturer, from the Faculty of Accountancy UiTM Shah Alam, beat six other participants from the local institutions of higher learning. She received RM15,000, a trophy and certificate.  The prize was presented by the Deputy Prime Minister and Chairman of Yayasan Nurul Yaqeen, YAB Tan Sri Dato' Muhyiddin Mohd Yassin, on 4 July, at the Royale Bintang Damansara. Also present were the Deputy Prime Minister’s wife, YABhg Puan Sri Datin Norainee Abdul Rahman and YBhg Dato Dr Hj Ismail Hj Ibrahim.  Well done Dr Sharifah Norzehan Syed Yusof! (note: entry obtained from UiTM's website" 

Islamic Finance Newsletter

The Accounting Research Institute (ARI) thanks our post doctoral scholar Dr Bashir Mande for initiating the publication of ARI Islamic Finance Newsletter which will be made available online through ARI's website.  As such we invite scholars and practitioners to contribute papers in the area of Islamic Finance and Muamalat.  The maiden issue contains two research papers written by two scholars.  The first paper titled "Shariah Audit: A Strugle Towards Best Practices" is written by Associate Professor Dr Nawal Kasim.  The second paper which is written by Dr Bashir Mande is titled "Effectiveness of Shariah Committee in Islamic Microfinance Institution".  Professor Dr Rashidah Abdul Rahman who is heading the Islamic Microfinance research cluster gives an exclusive interview where she elaborates on the progress of her Islamic Microfinance project - a collaboration with Mydin Mohamad Holdings Berhad, Amanah Ikhtiar Malaysia (AIM), Majlis Agama Islam Selangor and ARI.  Congratulations all....

Uncovering Financial Shenanigans

Dr. Howard M. Schilit in his book titled Financial Shenanigans: How to Detect Accounting Gimmicks & Fraud in Financial Reports lists seven different shenanigans often committed by perpetrators.  Shenanigans are actions or omissions designed to hide or distort the real financial performance or financial condition of a company.  The seven shenanigans are namely: (1) Recording revenue too soon; (2) Recording bogus revenue; (3)  Boosting income with one time gains; (4) Shifting current expenses to later periods; (5)  Failing to disclose all liabilities; (6) Shifting current income to later periods and (7)  Shifting future expenses to current periods.  In trying to understand the concept of shenanigans, the AFC713 students were given financial statements as they are presented in the annual reports.  Then they are to identify transactions that may involved at least 1 financial shenanigan. Congratulations guy, everyone managed to identify at least 3 financial shenanigans.