Privatisation of Telekom Malaysia Berhad: accounting and reporting change for the period of 1991 to 2000 / Jismi Md. Salleh

This dissertation examines issues related to accounting and reporting change in Telekom Malaysia from 1991 to 2000. During this period, Telekom Malaysia was operating as a privatised company after the listing of its shares on the Kuala Lumpur Stock Exchange in November 1990. Findings identified were critically explained in relation to major events and developments that took place in Telekom Malaysia and the telecommunications industry such as the 1996 tariff revision, 1997 economic crisis and the introduction of equal access with effect from 1 January 1999. Among others, this study showed that after privatisation, Telekom Malaysia has totally departed from the conventional cash basis governmental accounting system to a frilly commercialised one. Under the latter's system, due consideration was given on the need to ensure strict adherence to every guideline within the reporting framework, particularly the approved accounting standards. An instance of early adoption of MASB revised guideline was also noted. Other findings on accounting and reporting change highlighted in the study include numerous reclassification of reporting items, voluntary disclosure, discontinuation of disclosure and non-disclosure of reporting items, as well as issues pertaining to exceptional reporting trend. The study also highlighted that certain underlying factors have stimulated Telekom Malaysia to effect those changes. nAmong the stimuli identified were the status of being the first privatised company in Malaysia, unsatisfactory tariff structure, liberalisation of the industry and introduction of equal access, the economic crisis as well as rapid technological advancement in the industry. For instance, signs that income decreasing method being applied as a strategy to demand for tariff revision was encountered, similar to the finding discovered in an earlier study by Mohamed (1996). Findings from the study supported Liider's (1992) contingency model, which suggested the existence of stimulus prompting producer of financial information to reflect accounting and reporting change.