Are Malaysian Accountants Underpaid ?

Welcome to the latest chatter from The Accounting Parrot Newsletter! 

Last week, I had the opportunity to chat with my neighbour about his son's career progress in Melbourne, Australia. His insights into the accounting profession in Australia got me thinking about the salary differences between accountants in Malaysia and Australia.

This curiosity serves as the foundation of our discussion today: Are Malaysian accountants underpaid in comparison to their Australian peers?

Salary Comparison

Junior accountants in Malaysia can expect a salary of up to RM72,000 per annum, complete with benefits, which translates to approximately RM6,000 per month. In contrast, their Australian peers earn between AUD 60,000 to 70,000 per annum. Converted to monthly figures, this amounts to roughly AUD 5,000 to AUD 5,833. At first glance, the Australian salary package might seem more lucrative, especially when considering the currency exchange rate. However, the story doesn't end here.

Cost of Living: A Critical Look

To truly understand the financial landscape for accountants, we must consider the cost of living in both countries for a Junior Accountant. Our analysis reveals significant disparities:

- Housing: For the rental of a one-bedroom apartment in the city centre, Malaysians pay around RM 1,563, whereas Australians pay about AUD 1,744.

- Food: On a super tight budget, Malaysians spend approximately RM 246 monthly eating out, whereas Australians would spend about AUD 540.

- Transportation: A monthly public transport travel pass costs approximately RM 86 in Malaysia compared to AUD 128 in Australia.

- Utilities: In Malaysia, utilities cost around RM 165 monthly for an 85m² apartment, compared to AUD 188 in Australia.

Adding other expenses like groceries, lifestyle, and entertainment, the total monthly cost of living for a junior accountant in Malaysia averages RM 4,168, while in Australia, it is AUD 5,852.

Adjusting for Living Costs

When adjusting for these living costs, the apparent wage gap between Malaysia and Australia narrows. Australian accountants face higher living expenses, which can offset the higher perceived income.

Moreover, it's essential to consider additional discretionary expenses that may not be accounted for in the basic cost of living comparison. For instance, many junior accountants prioritise having the latest smartphone and maintaining monthly gym memberships, which can add a significant sum to their monthly expenditures.

Income Tax and Retirement Contributions

Income tax and compulsory retirement contributions further impact the take-home pay, influencing the overall financial picture for accountants in both Malaysia and Australia.

Malaysian accountants generally benefit from lower income tax rates and more favourable tax brackets compared to their Australian counterparts. Additionally, Malaysia's retirement savings program, such as the Employees Provident Fund (EPF), typically involves lower mandatory contributions than Australia's Superannuation scheme.

These differences in taxation and retirement contributions can significantly affect the disposable income available to accountants in each country, potentially stretching their income further in terms of local purchasing power.

Conclusion: Underpaid or Appropriately Compensated?

So, are Malaysian accountants underpaid? The answer isn't straightforward. While nominal salaries are higher in Australia, adjusted for the cost of living and taxes, Malaysian accountants might find their compensation more reasonable than it appears.

Cool Accounting Jobs : Accountant Position at Kuala Lumpur Kepong Berhad (KLK)

While we've been discussing how salaries differ for accountants in Malaysia and Australia, it's important to look at the whole package a job offers.

This brings us to a standout opportunity for an adventurous Malaysian accountant with Kuala Lumpur Kepong Berhad (KLK) located in Indonesia. This job offers a salary between RM 9,000 and RM 13,500 per month and is suited for candidates with 3 to 5 years of post qualifying experience (this is a good salary la).

Why is this job cool? It’s based in Indonesia, providing a unique chance to experience working in a new country. You’ll also lead a team, which is great for professional growth. This job is perfect for a Malaysian accountant who is excited about living and working in diverse cultural settings.

Interested in this opportunity? Click here to learn more and apply

Accounting Parrot is your go to source for the latest industry trends and exciting job opportunities. Whether you're an accounting professional in Malaysia, Australia, or anywhere else in the world, we're here to keep you informed and engaged.

For more in-depth analyses and updates, subscribe to our newsletter here!