PRIVATE ENTITY REPORTING STANDARDS (PERS)
The Malaysia Accounting Standards Board (MASB) has on 14 June 2006 announced that private companies particularly small and medium sized companies can adopt a set of simpler accounting standard known as Private Entity Reporting Standard (PERS).
PERS provide an alternative way for private entities to present their annual financial statements without compliance with the complex international accounting standards. PERS removes certain disclosure requirements which is less useful for decision making and are onerous for private companies to comply.
A private company is define by Section 15(1) of Companies Act 1965 as
A company having a share capital may be incorporated as a private company if its
Memorandum or articles:-
restricts the right to transfer its shares;
limits to not more than fifty the number of its members;
prohibits any invitation to the public to subscribe for any shares the company; and
prohibits any invitation to the public to deposit money with the company for fixed periods or payable at call, whether bearing or not bearing interest.
A private entity is a private company (as defined above):-
is not itself required to prepare or lodge any financial statements under any law by the Securities Commission or the Bank Negara Malaysia; and
is not a subsidiary or associate of, or jointly controlled by, an entity which is require to prepare or lodge any financial statements under any law administered by the Securities Commission or the Bank Negara Malaysia
Private entity can only qualify to be treated as a private entity only when through out the annual period it is a private entity. Further that organisation which is accountable to the public such as charitable organisation, social and other public accountable activities DO NOT allow to dopt the PERS, instead these entities should adopt the FRS.
Effective date of PERS is for annual periods beginning on or after 1st July 2007.
For complete set of PERS please visit http://www.masb.org.my/masbstd_perslist.htm