Journal of Law and Financial Management - Volume 12 (2) November 2013

Editorial »


A Study of Quality of Internal Control in the US Federal Financial Management Systems

By Nas Ahadiat

The primary purpose of this study is three-fold: to identify regulations designed to improve the United States government's financial management, to examine the current state of the agencies financial statements' audit and internal control and to investigate the changes, if any, in internal control over the past few years. The results demonstrate that while the US Congress has been vigilant in emphasising the importance of improving internal control over the federal financial statements, most agencies financial management systems are still marred with significant internal control weaknesses. More work is needed to strengthen the control systems in federal government and to develop a financial management system that is capable of producing reliable financial statements, and designed to generate financial statements that are comparable across the agencies and consistent from year to year.

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An Examination of FRS 136 by Malaysian Sha'riah Companies

By Nigel Finch, Khairil Faizal Khairi and Nur Hidayah Laili

The objective of the study is to investigate the compliance level and disclosure quality of FRS 136 by the top 20 Shari 'ah-approved companies in Bursa Malaysia as at 2010. The weighted index is employed to differentiate the quality and importance of each mandatory disclosure under FRS 136. The weighted index was developed by constructing disclosure scoring sheets, obtaining companies annual reports, completing scoring sheets for each firm by assigned weighting for the disclosure items and calculating disclosure weighted index. This study revealed that 13 out of 20 companies (65%) failed to comply with the most basic elements of the FRS 136 pertaining to goodwill impairment testing, especially in goodwill allocation and key assumptions used in determining the recoverable amount of CGU assets. This study suggests that the performance of the top 20 Shari'ah-approved companies must improve before Malaysian practice can attain a truly international standard.

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Subsidies of the Australian Clean Energy Package

By Felicity Deane

The Australian Clean Energy Package has been introduced to respond to the global challenge of climate change and reduce Australia's greenhouse gas emissions. It includes legislation to establish an emissions trading scheme. In support of the entities that are liable under this Package, there are a number of assistance measures offered to alleviate the financial burden that the Package imposes. This paper considers whether these assistance measures are subsidies within the context of the law of the World Trade Organization. In order to do this, the rules of the Agreement on Subsidies and Countervailing Measures are examined. This examination enables an understanding of when a subsidy exists and in what circumstances those subsidies occasion the use of remedies under the law.

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