AAAJ 12,3

``Interests'' and accounting standard setting in Malaysia
Faculty of Business and Accountancy, University of Malaya, Kuala Lumpur, Malaysia
Keywords Accounting profession, Malaysia, Standards Abstract This paper offers insights into the conflicts and tensions within the Malaysian accounting profession and the power struggle therein to dominate the accounting standard setting process, within the context of a rapidly developing country. It shows how interest groups and parochial interests, along with issues of self-protection, affected the process of standard setting, which was controlled by different interests over the period under study. At one time the profession dominated. But far from being a monolithic body, it was in turn split according to various interests: the Big Six behind the Malaysian Association of Certified Public Accountants (MACPA) and the smaller firms behind the Malaysian Institute of Accountants (MIA). At other times big business prevailed. These conflicts and power struggles are revealed through an analysis of the case of the Goodwill Accounting Standard.

Selvaraj D. Susela

358

Introduction This paper offers an understanding of the struggle within the accounting profession for control of the standard setting process, in the context of a developing nation. The focus on standard setting is specially geared to reveal the impact of that process on the profession, market, state and community, and vice versa. Susela (1996) illustrates that because standards clearly impact on practitioners (the profession), it is hardly surprising that they develop ``interests'' around standard setting, whether expressed through accounting associations or firms. The standard setting arena is here viewed as a site of struggle between interest groups, both within the profession and outside it. To date, no such study has been done of the Malaysian