CSC Steel Holding Berhad is a company incorporated and domiciled in Malaysia,public limited liability company and listed on the important market of Bursa Malaysia Securities Berhad.CSC stands for China Steel Corporation.Date of incorporation of the company are 20 January 2004.At 180,Kawasan Perindustrian Ayer Keroh ,Ayer Keroh 75450 Melaka is the principal place of business of the company.The CSC Steel registered office is located at 49-B,Jalan Melaka Raya 8,Taman Melaka Raya,75000 Melaka.The company is principally involved in investment holding and provision of managemet services.
The subsidiaries of the company are CSC Steel Sdn Bhd,Constant Mode Sdn Bhd,Tatt Glap Steel Centre Sdn Bhd and Group Steel Corporation (M) Sdn Bhd.CSC Steel Sdn Bhd date of incorporation are 14 November 1991.The principal activities of the company are manufacturing and marketing of pickled and oiled steel (PO) ,cold rolled steel (CS),hot dipped galvined steel (GI) commonly known as GI and prepainted galvanized steel (PPGI) commonly known as PPGI or colour coated steel.
While Constant Mode Sdn Bhd date of incorporation are 19 November 2010 and the principal activity are investment holding.Date of incorporation of Group Steel Corporation (M) Sdn Bhd are 19 December 1994 and principal activities are dormant.Tatt Glap Sdn Bhd are incorporated at 9 August 1994 and principal activities are a service centre for steel products.The group achieved high revenue of RM 1.382 billion in financial year 2018 while RM 1.323 billion at year 2017.In financial year 2017 , profit before tax was recorded RM 77.078 (RM”million) compared to 2018 lower than RM 26.306 (RM”million). the influx of imported steel products had posed an adverse effect on steel price and the Group and the weakening market sentiment in second half of Financial Year 2018 were the main reason for the lower profit.As at 31 December 2018,the group financial postion have slightly decrease.Net tangible asset for Financial Year 2018,has drop to RM 2.18 per share while Year 2017 was RM2.22 per share.Cash and cash equivalent was RM192.532 million.Total equity stood at RM 804.866 million & current ratio stood at 7.08 times.During Financial Year 2018,CSCM had spent about RM 14 million in capital expenditure,with the aim to improve product quality and production efficiency.The significant projects were the revamping of Tension Leveling Line and Continuous Galvanizing Line’s Welder.In Financial Year 2018, the change of controlling stakes in the associated company had been completed in the mid of year 2018,the Group’s investment in associated company continue to suffer losses during the year under review and the new major shareholder had outlined a corporate turnaround plan to be implemented in the coming years, they believe that the performance of the associated company would be gradually improved.2.EXPLANATIONa)RelevanceIf it influence the decision making of the user by helping them evaluate the present,past and future decision and correct or confirm past decisions the information is relevant.Materiality test is the only material items should be involve in financial reports.An item is material if it is big enough to effect the decision making of the company and misstating or omitting would result in a bad decision. b)ReliabilityIn the firm’s accounting report only reliable information should included.Reliable information are free from estimates,error and personal opinions.It is based on data that can be verified and checked.To verify it need source document.Internal control involve the pratices involved to ensure that the firm’s asset are protected from misrepresentation,theft and fraud,and accounting record and reports are reliable and accurate.For example,a business received a abnk statement RM 30,000.00 payment to a supplier for stock and the firm’s stock records shows the stock coming in,but there is only RM 25,000.00 of stock onn hand and RM 5,000.00 stock is missing.It shows that the person incharge of the firm’s bank account and are the want who incharge in stockroom.to ensure fraud there should have separation of duties.c)ComparabilityUsers should be able to compare the financial reports of business.Information is comparable when can be compared over time and between different entities.The usual accounting methods are used every year to prepare financial reports.From year to year certain transaction are treated in a consistent manner example asset values.For example uses consisten way to calculate deprecation such as staright line method so later on financial report can be compared.For example,the CSC Steel company use staright line method to calculate depreciation of PPE and land.d)ComprehensibleAccounting reports often have complex numbers and terms in them,At the end of use the information must be understandable.Information is understandable when users can simply comprehend its meaning (reasonable knowledge of business and economic are assume).Its not mean that excluding complex information but explain in a way that user with a low to reasonable knowledge of accounting would understand.Avoid using complex term for example amortisation and goodwill.Use simple language that is easily can comprehend.For example,the CSC Steel company have used headings and formatting in income statement to make sure is clear and readable.e)TimelinessFinancial information should be available or communicated early enough when a decision is to be made.The less timely (thus resulting in older information), the less useful information is for decision-making.It competes with other information so timeliness matters for accounting information. For example, if a company issues its financial statements a year after its accounting period, users of financial statements would find it difficult to determine how well the company is doing in the present.For example,this CSC Steel company provide their financial statement on time there is no problem for the financial information user.h)Cost beneficialProducing management information include costs,such as the cost of analysing,collecting and interpreting the data obtained before converting it into the required information format.It is important for the information to produce outcomes which can pay off the cost concerning it.Than the cost of obtaining such information ,the value of the information produced (benefits) must be higher.The information must be useful before it can produce an outcome. nefit Most decision makers assume that information is a cost free commodity, while providers know it is not.Against the benefits of using the information the costs of providing the information should be weighed .Cost-benefit decisions are extremely hard because both benefits and costs are often subjective and difficult or impossible to measure reliably(Obaidat, 2007).In other words,should be affordable providing accounting information.3)DISCUSSION ON RELEVANCE AND TIMELINESSa)RelevanceRelevance mention to how helpful the information is for financial decision-making processes. For accounting information to be relevant, it must own predictive value which give predictive power regarding possible future events and confirmatory value which provide information about past activity.Therefore, accounting information is relevant if it give helpful information about past activity and help in predicting future activity or in taking action to deal with possible future events. For example, a company experiencing a strong quarter and presenting these improved results to creditors is relevant to the creditors’ decision-making process to extend or enlarge credit available to the company.For CSC Steel company it shows The Board conducted quarterly review and evaluation of the Group’s performance and the progress of the new projects as well as approving the quarterly results within the stipulated timeframe. . Anderson and Raun (1978) state that what information have decides by decision makers he consider as relevant for his decision. The accounting data may affect the decision,if the proportion of input of accounting information compared to non-accounting information is more than zero.Management staff was invited to attend Board meetings to brief the Board on the financial and non-financial information and the achievement of the business performance as well as the progress of the key initiatives.Relevant information can increase company profit .Dandago and Tijjani (2005) believes that management accountant of an entity most use information from from the cost and financial accounting system,he conduct special investigation to collect required data,have proper skill from operational and statistical research to provide data which relevant for decision to be made. .The Board ensures that the performance reporting process linked objectives, principles and practices to its needs.Accountants play an important role in producing relevant information for making economic and financial decisions.Can affect the company in a very negative way and sometimes also lead to its bankruptcy if implement the wrong one.Young (1982) state that The road to bankruptcy is paved with poor decisions from irrelevant information.To provide the best option the management should judge from relevant data.Therefore they need some guide of data Bierman,Bonini and Hausman (1986).b)TimelinessTimeliness principle is closely related to the relevance principle.Timeliness of accounting information is highly desirable since data that is presented timely is generally more relevant to users while conversely, delay in provision of information tends to render it less relevant to the decision making needs of the users. Timeliness principle is therefore closely related to the relevance principle.To protect the users of accounting information basing their decisions on outdated information timeliness is important Imagine the problem that could arise if a company was to issue its financial statements to the public after 12 months of the accounting period. The users of the financial statements, such as potential investors, would probably find it dificult to assess whether the present financial circumstances of the company have changed drastically from those reflected in the financial statements. In compliance with this requirement, CHB’s Annual Report 2018 will be issued on 26 April 2019 which is also the date of despatch of the notice of its 15th AGM. The coming 15th AGM, scheduled on 23 May 2019 (Thursday) at its business premises in Melaka, would provide the Company’s shareholders with an avenue to raise any queries that they may have on the Company and the Group.Accounting information is any information provide by an accounting system which constitute set of human and capital resources within an organization which is responsible over the preparation of financial information suggest by Lucey (2003).Dandago and Tijjani (2005) believe that accounting information is a written information for the class that might be contained in a complete particular financial report such as income statement,financial position and others.It is clear,accounting is not an end itself,it is a useful tool,it is a language for communicating the financial facts about an economic entity or activity to those who have interest in interpreting ,analysing and using those facts,it would also produce information on the entire profitability of various models so that the primary and production decision could be made more appropriate.The value of a financial statement will be reduced if the report is not available on time is timeliness. The ability of managers to respond correctly to an activity may be influenced by the timeliness of the management accounting system. Timeliness information enhances the facilities of the management accounting system to report on the latest activity and to produce quick respond on the decisions that have been made.The frequency of reporting and reporting speed is include in timeliness.Timeliness shows the frequency and speed of the report used IAI (2011: 28) states that “the benefits of a financial report will be reduced if the report is not available on time.4)IMPORTANCE OF RELEVANCE AND TIMELINESSa)RelevanceAccounting information must be capable of making a difference in a decision is known as relevance to relevant. Information with no bearing on a decision is irrelevant. Financial information is capable of making a difference when it has confirmatory value, predictive value,or both.one of the two fundamental decision-specific characteristics of useful accounting information is relevance. Relevant information is capable of making a changes in a decision. Relevant information helps users to make predictions about the outcomes of past, present, and future events, or to confirm or correct prior expectations. Relevant information can, in some instances, be both confirmatory and predictiveThe relevance of information is influenced by its nature and materiality. In some cases, the nature of information alone is sufficient to determine its relevance. For example, the reporting of a new segment may affect the assessment of the risks and opportunities facing the entity irrespective of the materiality of the results achieved by the new segment in the reporting period. In other cases, both the nature and materiality are important, for example, the amounts of inventories held in each of the main categories that are appropriate to the business.if its omission or misstatement could influence the economic decisions of users taken on the basis of the financial statements the information is material. Materiality based on the size of the item or error judged in the particular circumstances of its omission or misstatement. Relevant accounting information means that it should produce a good and logic basis for decisions of users.Relevance can be defined to influence the accounting information on decisions of users.Anticipated effects of current and future events,result of past events, confirms or modifies previous expectations(Noravesh & Shirzadi, 2012). Relevant information assist decision makers make predictions about future; it has Predictive Value. It also helps decision makers confirm or correct prior expectations; it hasFeedback Value.Without an interest in the future, knowledge of the past is useless ,without knowledge of the past, the basis for a prediction will usually be lacking,information also must be timely Timeliness to be relevant.b)TimelinessTimeliness means having information available to decision makers before it loses its capacity to influence decisions. a lack of timeliness can rob information of its usefulness and having relevant information available sooner can enhance its capacity to influence decisions, Before it loses its capacity to influence decisions the information must be available to a decision maker.Information which is unavailable when it is needed or becomes available only long after it has value for future action is useless(Obaidat, 2007). The timeliness of financial reporting has long been known as one of the most main elements contributing to the general-purpose of annual reports. It is also one of the most main components of relevancy and is an main feature of useful information. Timely presentation and disclosure of information improves the image of corporate bodies because they reflect managerial efficiency and effectiveness (Joshi, 2005). The importance of timeliness is further supported by the research of Abdulla (1996), who suggested that a lesser time between the financial year-end and publication date is more advantageous for users. The standard of financial reports depends in part upon the frequency and timeliness of reporting (Miller & Bahnson, 1999). Leventis, Weetman, & Caramanis (2005) claimt that in emerging market economies, timeliness in reporting of otherwise non-publicly available financial statement information remains, for the most part, the only means by which outside shareholders and investors keep themselves informed of the firms’ performance.In order that they can make reasonable decisions, users of financial information should be able to reach information they need in a timely manner. Investors and creditors should use latest financial information when making predictions and decisions. To make sure the availability of current information, firms should therefore release financial information to the public as soon as possible. Within this context, the timing of information is at least as important as its content for financial information users. In addition, stock values of publicly held companies are assumed to be based on such disclosed information. Disclosure of financial results, which are main indicators of a firm’s performance, is a determining factor of firm value formed in the market (Dogan et. al., 2007). Late in releasing information may cause the information to be irrelevant for making decisions. A delay in releasing the financial reports may rise the uncertainty level of investors’ decisions (Givoly and Palmon, 1982) because it intensifies the level of historical information (Zeghal, 1984). To upgrade the investment decisions of investors, companies may try to report their results more promptly. Since companies are likely to stick to the minimum requirement, one of the effective ways to induce more timely reporting is to lesser the allowable reporting lag.