Prepare Ahead to Extend Your Businesses in Malaysia As Per the New MBRS System
Regulators worldwide are adopting XBRL to improve transparency in data filing. The Companies Commission of Malaysia, or SSM, officially launched the XBRL initiative for automating the digital submission of annual financial statements, which was previously done via print or on the counter. Since the XBRL mandate is just around the corner, it is important to know how you can extend your business in Malaysia according to the MBRS system. But first, let’s understand some basics of XBRL.
What is XBRL?
XBRL, or eXtensible Business Reporting Language, is an open, international standard used to exchange financial and non-financial information in a digital format. This computer-based language allows the electronic communication of structured data by offering a machine-readable tag.
XBRL standardises financial reporting and enables electronic systems to recognise and process data automatically throughout the reporting chain. Furthermore, the technology simplifies the delivery of digital reports to the concerned parties and improves access to information for business analysis.
What Do Businesses Need to File After the XBRL Mandate?
Once the XBRL mandate rolls out in Malaysia, businesses operating in the country must comply with the submission of Annual Returns (AR) and Financial Statements and Reports (FS) to SSM.
Annual Returns: Annual returns are the summary of a company’s profile which includes general information, such as business office address, branch office address, list of shareholders, appointed company secretary, etc. The director must sign an annual return and submit it within a month after the company holds its Annual General Meeting (AGM).
Preparing annual returns is pretty straightforward. Businesses can use mTool (MBRS preparation tool) to prepare the one-pager XBRL annual return.
Financial Statements: The Annual Financial Statements reflect a true picture of the position and performance of a company. Financial statements incorporate income statements, balance sheets, and cash flow statements. The company’s directors must prepare audited financial statements as per the Malaysian Financial Reporting Standards (MFRS) or Malaysian Private Entity Reporting Standards (MPERS). The reports must be prepared within eighteen months of the company’s incorporation and afterwards within six months of the financial year-end.
Unlike annual returns, financial statements are lengthy, complicated reports with 100+ pages. Issuers may find it challenging to fill in the MBRS templates and prepare the reports manually. So if you are looking to extend your business in Malaysia, you must prepare yourself by either hiring an in-house team or finding third-party vendors that fulfil your MBRS needs.
What are the Next Steps?
Currently, XBRL is not mandated in Malaysia. Therefore, businesses have been preparing reports in PDF format without worrying about XBRL generation. However, now that XBRL is going to be mandated soon, businesses need to prepare themselves for XBRL filing on the MBRS portal. If you are extending your business in Malaysia and find it difficult to build an in-house team for XBRL filing, you can outsource your filing needs to a trusted partner like DataTracks.
While annual returns are quite simple to prepare, companies may face challenges while generating XBRL financial statements. DataTracks, with its 18 years of rich experience, can help you prepare error-free reports. The experts at the company can perform all filing activities, from template filling to XBRL conversion, with ease. What’s more? DataTracks has a commendable track record of preparing more than 348,000 compliant reports for 23,400+ clients. Contact an expert at +60-392-126-125 or email @email@example.com to get started on your business extension to Malaysia.