Accounting Standards for Islamic Financial Institutions

The scientification of economics has resulted in a separation of economics from ethics. Economic theory is now a positive science which analyzes and explains mechanisms of economic process. Ethical valuation should not form part of the economist research program. However, the evolution of Business Government Society nexus have forced businesses to take ethics seriously especially because of their evolving customers ethics creating a stakeholder model centered around social responsible business. Islam arguable more than any other religion is concern about economic activities. This is not only because the Quran came down in economic driven milieu but because the Quran connects the belief in God firmly with socio economic justice. In order to achieve an egalitarian society, Islamic economic institutions advocated by Islam is not static but dynamic because it is not fixed to form but driven base on achieving ethical results. Islamic economic activities aims to and should be evaluated to what extend it helped alleviate poverty, encourage healthy equitable development and ultimately promote economic justice in society, a vision of a "humane economy" which benefits and is concern for all and not just the few.

The word Maisir in Arabic literally means to obtain something very easily without hard work or to gain profit without working. It is anything that involves gambling, betting or risky games. Another term used in the Quran is the word `azlam' which means the practice of gambling. Economic activity plays a vital role in creating a prosperous, just and prosperous society. Islam teaches in the economic system of its ummah, based on the values of justice that must be upheld, and become the main principle for conducting economic activities. Every economic activity must contain elements of benefit and not mistreatment of himself and others, so that economic activity can create community welfare equally. Conducting economic activities is not allowed to be done if it contains elements of gharar, maysir and usury or taking the rights of others by false means. In the Qur'an letter al-Baqarah: 219 and surat al-Ma'idah: 90 and 91, it is known that gambling is an abominable act that is forbidden by Islam. The scholars also said that gambling (maisir) is a game where the winner gets a certain amount of money or goods without reasonable effort and can make people fall into the valley of poverty because it contains three elements, namely games/competitions, there is a bet, luck. Today's modern conventional (non-sharia) businesses generally contain three elements that are prohibited in Islamic economic ideology, namely gharar, maisir and riba. This happens not separated from the reality of conventional business development trends and not widespread awareness and coverage of economic services based on Islamic economics. Bank Muamalat Indonesia (BMI) is the first purely Islamic bank in Indonesia which in principle all of its main products both in the service of Financing Strategy products (deposits funds) and financing products (financing) based on the Islamic system (profit sharing). BMI seeks to implement aspects of Islamic economic ideology that consistently avoids gharar, maisir and usury. Keywords gambling practices (maisir), activities, modern economy.

Zakat information in annual reports is one of the main attributes that differs Islamic banks from conventional banks. Thus, this study focuses on the zakat information that can be found in Islamic banks financial statements in comparison to the available standards. Reporting standards and guidelines from BNM, AAOIFI, JAWHAR and MASB were used by these banks as guidelines in calculating, distributing and reporting zakat. Due to the absence of standardized accounting standard, certain zakat information was not found in the financial statements. Compared to previous literatures, Islamic banks are moving towards increasing their zakat information disclosure. Based on the analysis of selected Islamic banks’ annual reports, this study concludes by suggesting establishment of standardized zakat distribution framework for Islamic banks. Keywords: Zakat, Reporting Standards, Disclosure, Financial Statement, Islamic Banks. Abstrak Maklumat tentang zakat dalam laporan tahunan adalah salah satu...

This article outlines a methodology for the gradual prohibition of alcohol and gambling within corporate structures, drawing inspiration from the stages of prohibition presented in the Quran. Additionally, it explores a new perspective on Surah Al-Baqarah 2:219, highlighting its direct link to business practices by guiding large businesses and corporations on aligning their practices with Islamic ethical standards if a society chooses to adopt Quranic principles in their laws and constitution.

This study explores the challenges and solutions in practising the Islamic financial management (IFM) in Islamic financial institutions (IFIs) in different countries based on a secondary research approach. Using keywords relating to the topic area, this study finds some challenges and solutions from previous studies. In this regard, the study searched the keywords in the Google scholar, which is the facilitator in getting respective research papers, books, reviews, chapters, and proceedings. The study finds that there are many challenges that include difficulty in measuring Shariah compliance risks, lack of employee dedication and poor monitoring, no mandatory auditing, confusion regarding Shariah supervisory committees (SSCs) and Shariah council, lack of awareness and local culture, lack of long-term financing and taxation, falsification and no central rules, lack of knowledge of Islamic finance, lack of technological integration and training, weak legal, regulatory and supervisory frameworks, absence of Islamic money or capital market, absence of supportive and link institutions, long-term financing. On the other hand, the study also provides some solutions to overcome the challenges that include similar rules and regulations, lack of monitoring, coordination, training, and government support. The implications, limitations, and future direction of the study are discussed.

The purpose of accounting is to gather financial data of a business or entity, to interpret this data and to report the results in financial statements to the different users thereof. The interpretation of financial data is regulated by financial accounting standards including an conceptual framework that were developed to facilitate the reporting of financial information of entities so that investors, analysts, creditors as well as the entities themselves can make informed financial decisions. Due to the history as well as some of the mechanisms used to develop the financial accounting standards, conceptual framework and interpretations, inconsistencies and ambiguities are part of the common legacy accountants and auditors are confronted with every day. This is problematic because financial reports have to be clear, concise and unambiguous as the cornerstone of international economies. In order to address the inconsistency problems, the development of unambiguous and principle based financial accounting standards is a key initiative of international financial accounting standards bodies such as the FASB and the IASB at present. This paper is concerned with the question of how recent developments in computer science technologies, specifically within knowledge representation and ontology technologies, could assist in dealing with and eliminating inconsistencies and ambiguities within and between different financial accounting standards. In our research, we developed a formal ontology for some of the basic elements, and in this paper, we report on our findings as well as make some suggestions for a formal approach to the conceptual framework and financial accounting standards development.

MS 1900:2014 Sharīʿah-based Quality Management Systems-Requirements with Guidance (First Revision) or MS 1900:2014 is the Islamic version of the ISO 9001. Compared to ISO 9001:2015-Quality Management Systems (ISO 9001:2015), which is characterised by “risk-based thinking,” the aspect of risk management is not given due focus in MS 1900:2014. Instead, the focus is more on efforts to improve governance and organisational efficiency as outlined by Islamic principles. However, since MS 1900:2014 makes Sharīʿah as the main basis of its certification requirements, the element of risk management is definitely implicit in the standard. This is because in an effort to ensure its objective, i.e., realisation of benefits (taḥqīq al-maṣlaḥah) is achieved, the Sharīʿah uses the approach of promoting what is good and beneficial (jalb al-maṣlaḥah) and preventing what is evil and harmful (dafʿ al-mafsadah). Therefore, although it does not clearly state the concept of risk management in the standard, any organisation that uses MS 1900:2014 may also achieve the advantages of risk management if they adopt the standard. Thus, by using content analysis method, this article seeks to analyse and describe the requirements implicitly related to the aspect of risk management contained in the MS 1900:2014 standard. Based on the analysis of the certification requirements, it was found that MS 1900:2014 indeed has riskbased characteristics even though this is not clearly stated in the standard document. Therefore, if the MS 1900 is implemented correctly by any company, it will not only achieve efficiency and effectiveness in organisation management but also can further improve its risk management capabilities.

For full article please visit: https://tafhim.ikim.gov.my/index.php/tafhim/article/view/233

Zakat is one of the pillars in Islam, a mandatory obligation to the Muslims. The payment of zakat is an expression of thankfulness to the Almighty God (Allah) and recognition of His rewards. Zakat is no longer perceived by many that is merely limited to the domain of religious or syariah studies and discourses, but has been widened to include the issue of social economics. Therefore, a proper treatment of zakat is needed. In Malaysia, an accounting treatment relating to the payment of zakat on business, TR-i1 had been issued by Malaysia Accounting Standard Board (MASB) to facilitate the computation of zakat on business. However, since zakat management is under the jurisdiction of State Islamic Religious Council (SIRC), the Technical Release 1 (TR-i1) issued just becomes a guideline which does not have the same weight as a standard. The objective of the paper is to investigate the level of compliance to the guidelines as being practiced by the listed Government Link Companies (GLCs). The study will focus on the methodology used for zakat computation and the disclosure being made in the annual report. All the 33 listed GLC companies were used for the study. From the result, it was found that the guidelines were not being followed. A practiced by GLC's was totally different from what has been mentioned in the TR-i1.

Buying and selling or trading in the term fiqh are called al-Ba'i which, according to etymology, means selling or replacing. The word al-Ba'i in Arabic is sometimes used for the understanding of his opponent, namely the word al-Syira (buy). Thus, the word al-Ba'i means selling, but also means buying. In terminology, buying and selling is an agreement to exchange objects or goods that have a good value between the two parties, one receives objects and the other receives them in accordance with an agreement or provision that has been justified and agreed upon. In the Qur'an, there are many statements that describe the life of the Arabs, including trade problems. Islam is very concerned about the problem of trade in this Arab nation by setting for them what they need. Many of the Prophet's hadith mention the legal issues of buying and selling, monopoly, accounts payable, profits, etc. Jahiliyah Arabs have a market as a center of trade. Usury is one type of economic ...

Zakat is one of the pillars of Islam and part of ibadah (obligation) for Muslims. Zakat has been identified as an important source of financial seed to jumpstart the economy of the Muslim community and give an impact to socio-economy development of a nation. Today, Zakat is no longer limited to the domain of religious or shari'ah studies and discourses, but an effort has been taken to restore back its function as a tools to strengthen Muslims economics. Many initiatives have been taken to facilitate its collection. An accounting standard relate to the Zakat payment MASB TRi-1 (Malaysian Accounting Standard, Technical Release Islamic-Number 1). Accounting for Zakat on Business, had been issued to facilitate the Zakat computation on business. The purpose of the release of MASB TRi-1 is to standardize the recognition, measurement, presentation and disclosure of zakat on business. However, MASB TRi-1 does not have the same weighted as standards. The objective of the study is to gauge the perception of accounting practitioners about MASB TRi-1. Questionnaires were sent to 282 accounting practitioners who have studied either Islamic accounting or Islamic finance. The finding revealed that most of the practitioners, regardless of their religious beliefs, are very keen to learn and deal with MASB TRi-1. Another encouraging finding is that the disclosure required by MASB TRi-1 encompasses the objective of Islamic Accounting.

The concept of property, as defined in Sharia and other holy scriptures, is a subject of profound significance in religious and moral contexts. This abstract aims to provide a concise overview of how the concept of property is understood within Islamic jurisprudence and its parallels in other major world religions.

The aim of this paper is to focus on the impact of non-sharia compliant income of Islamic banks on customers’ trust and commitment. The research work has followed the qualitative strategy as it has worked on secondary qualitative data. Books, journals, and credible websites have been reviewed as the primary methods of collecting secondary qualitative data. Thematic analysis has been used to analyse the gathered data. According to the findings of this paper, those banks which are not focusing on shariah compliance cannot achieve the trust of the customers which ultimately leads to a lack of customers commitment.

هدف هذا البحث إلى التعرف على أثر تطبيق معايير المحاسبة الإسلامية في تحقيق خاصية الملاءمة والموثوقية في التقارير المالية للمصارف الإسلامية في سورية. تم الاعتماد على المنهج الوصفي التحليلي، وتوزيع الاستبيان المدراء والعاملين في مجال المحاسبة والحوكمة والتدقيق الداخلي في المصارف الإسلامية العاملة في سورية، وعددها ثلاثة مصارف، وتم استرداد 75 استبياناً صالحة للدراسة، وتوصلت الدراسة إلى النتائج الآتية:
• أن تطبيق معايير المحاسبة الإسلامية يحقق خاصية الملاءمة في التقارير المالية للمصارف الإسلامية، من وجهة نظر العاملين في المصارف الإسلامية في سورية.
• أن تطبيق معايير المحاسبة الإسلامية يحقق خاصية الموثوقية في التقارير المالية للمصارف الإسلامية، من وجهة نظر العاملين في المصارف الإسلامية في سورية.
وتم تقديم عدد من التوصيات.
الكلمات المفتاح: معايير المحاسبة الإسلامية، الملاءمة، الموثوقية، التقارير المالية، المصارف الإسلامية.
Abstract: This research aimed to identify the impact of the application of Islamic accounting standards in achieving the feature of relevance and reliability in the financial reports of Islamic banks in Syria. The analytical descriptive approach was relied on, and the questionnaire was distributed to managers and workers in the field of accounting, governance and internal auditing in Islamic banks operating in Syria, and there are three banks, and 75 valid questionnaires were retrieved for the study, and the study reached the following results:
• The application of Islamic accounting standards achieves the characteristic of convenience in the financial reports of Islamic banks, from the point of view of workers in Islamic banks in Syria.
• The application of Islamic accounting standards achieves the characteristic of reliability in the financial reports of Islamic banks, from the point of view of workers in Islamic banks in Syria.
A number of recommendations were made.
Keywords: Islamic Accounting Standards, Relevance, Reliability, Financial Reports, Islamic Banks.

There has been an increasing need for principle-based financial reporting standards of Islamic Financial Institutions (IFIs) including business zakat reporting. In meeting the requirement of the shariah governance framework, business zakat computation is one of the aspects that must be disclosed and presented by IFIs on the face of their financial statements. The disclosure is vital in further promoting transparency and continuous development of IFIs within the tax and zakat environment. The objective of this study is to identify to what extent of business zakat computation among IFIs are in compliance with reporting requirements and rules in Malaysia and Saudi Arabia. In the light of the Malaysian regulatory and legal framework, a new policy document on Financial Reporting for Islamic Banking Institutions has been issued by Bank Negara Malaysia (BNM) in 2019.  The Kingdom of Saudi Arabia (KSA) General Authority of Zakat and Tax (GAZT) has published the rules for computing zakat by ...

Zakat is one of the pillars in Islam, a mandatory obligation to the Muslims. The payment of zakat is an expression of thankfulness to the Almighty God (Allah) and recognition of His rewards. Zakat is no longer perceived by many that is merely limited to the domain of religious or syariah studies and discourses, but has been widened to include the issue of social economics. Therefore, a proper treatment of zakat is needed. In Malaysia, an accounting treatment relating to the payment of zakat on business, TR-i1 had been issued by Malaysia Accounting Standard Board (MASB) to facilitate the computation of zakat on business. However, since zakat management is under the jurisdiction of State Islamic Religious Council (SIRC), the Technical Release 1 (TR-i1) issued just becomes a guideline which does not have the same weight as a standard. The objective of the paper is to investigate the level of compliance to the guidelines as being practiced by the listed Government Link Companies (GLCs). The study will focus on the methodology used for zakat computation and the disclosure being made in the annual report. All the 33 listed GLC companies were used for the study. From the result, it was found that the guidelines were not being followed. A practiced by GLC's was totally different from what has been mentioned in the TR-i1.

The adverse effects of gambling has gained the interest of writers over the years and more particularly, the religious writers. In Nigeria, the permissibility of gambling which disclosed the operation of gambling houses need an intervention, not because it is religious operative but its torrent of societal vices that sprung through the activities. In this paper, the framework of Islamic position on gambling is discussed, the effect of gambling on the religious condition, the legal relationship of this stance with the adverse effects of it in the society.

The aim of this paper is to focus on the impact of non-sharia compliant income of Islamic banks on customers’ trust and commitment. The research work has followed the qualitative strategy as it has worked on secondary qualitative data. Books, journals, and credible websites have been reviewed as the primary methods of collecting secondary qualitative data. Thematic analysis has been used to analyse the gathered data. According to the findings of this paper, those banks which are not focusing on shariah compliance cannot achieve the trust of the customers which ultimately leads to a lack of customers commitment.

The aim of this paper is to focus on the impact of non-sharia compliant income of Islamic banks on customers’ trust and commitment. The research work has followed the qualitative strategy as it has worked on secondary qualitative data. Books, journals, and credible websites have been reviewed as the primary methods of collecting secondary qualitative data. Thematic analysis has been used to analyse the gathered data. According to the findings of this paper, those banks which are not focusing on shariah compliance cannot achieve the trust of the customers which ultimately leads to a lack of customers commitment.

The aim of this paper is to focus on the impact of non-sharia compliant income of Islamic banks on customers’ trust and commitment. The research work has followed the qualitative strategy as it has worked on secondary qualitative data. Books, journals, and credible websites have been reviewed as the primary methods of collecting secondary qualitative data. Thematic analysis has been used to analyse the gathered data. According to the findings of this paper, those banks which are not focusing on shariah compliance cannot achieve the trust of the customers which ultimately leads to a lack of customers commitment.

This paper aims to identify the competency components of Islamic legacy planners in the event of post COVID-19 pandemic crisis in Malaysia. A qualitative approach using a multiple-case study through semi-structured interview was used. Data was gathered from a representative of full-fledged Islamic trust companies in Malaysia on what constitute as required competency components for Islamic legacy planners. In total, 4 interviews have been performed involving the decision-makers as well as c-level executives of the participating companies. It is found that there are non-standardised guidelines on recruitment of Islamic legacy planners. The majority of the respondents within the group have also chosen fiqh mawarith as the main knowledge to be acquired besides knowledge in product and solution, law and regulations. The results of this study have practical contributions to the regulatory bodies, academicians and professionals. The competency framework is recommended to the industry playe...

Knowledge movement has been increasingly regarded as a vital indicator of competitiveness. This paper aims to explore the origin of knowledge movement from the perspective of Islamic ethics. It overviews the concepts of knowledge and knowledge management and comprehends its implications. The main method is by interpreting the relevant citation from holy Qur"an. It highlights the Islamic conception of knowledge through understanding its nature in the reality of knowledge society. With regards to the Islamic conception of knowledge, the Qur"an invites human beings to read both the natural phenomena and the divine text (revelation). Generally speaking, knowledge management and classification are very much influenced by the way society conceptualizes and realizes knowledge. Eventually, knowledge management and classification guide man to the ways of knowledge utilization. Therefore, any success achieved by a person is an output of his/her knowledge understanding and knowledge growth within himself. In this status, human beings might be influenced by a certain situations, limitations and constrains internally or externally that lead him to persuade either body knowledge or the functional usage of knowledge in making his own individual success in a form of user-centric based values. In this way, this paper is expected to extend the understanding of knowledge and provide a guide for Muslims to better manage knowledge with Islamic ethics.

The formation of preference shares involves musharakah contracts or companies in Islam. However, preference shares have different specifications with ordinary shares. This distinction of specification prevents the law of preference shares to accept disputes between Muslim scholars both locally and globally. The objective of this study is to analyze the status of preference shares from Islamic perspective. The content analysis method was chosen as the design of this study. The qualitative data is collected through document analysis. Meanwhile, the process of analyzing is done by using descriptive approach. The finding shows that the concept of preference shares is appropriate for adoption but requires modification in the structure of the contract.

The aim of this paper is to focus on the impact of non-sharia compliant income of Islamic banks on customers’ trust and commitment. The research work has followed the qualitative strategy as it has worked on secondary qualitative data. Books, journals, and credible websites have been reviewed as the primary methods of collecting secondary qualitative data. Thematic analysis has been used to analyse the gathered data. According to the findings of this paper, those banks which are not focusing on shariah compliance cannot achieve the trust of the customers which ultimately leads to a lack of customers commitment.

Zakat is one of the pillars of Islam and part of ibadah (obligation) for Muslims. Zakat has been identified as an important source of financial seed to jumpstart the economy of the Muslim community and give an impact to socio-economy development of a nation. Today, Zakat is no longer limited to the domain of religious or shari'ah studies and discourses, but an effort has been taken to restore back its function as a tools to strengthen Muslims economics. Many initiatives have been taken to facilitate its collection. An accounting standard relate to the Zakat payment MASB TRi-1 (Malaysian Accounting Standard, Technical Release Islamic-Number 1). Accounting for Zakat on Business, had been issued to facilitate the Zakat computation on business. The purpose of the release of MASB TRi-1 is to standardize the recognition, measurement, presentation and disclosure of zakat on business. However, MASB TRi-1 does not have the same weighted as standards. The objective of the study is to gauge the perception of accounting practitioners about MASB TRi-1. Questionnaires were sent to 282 accounting practitioners who have studied either Islamic accounting or Islamic finance. The finding revealed that most of the practitioners, regardless of their religious beliefs, are very keen to learn and deal with MASB TRi-1. Another encouraging finding is that the disclosure required by MASB TRi-1 encompasses the objective of Islamic Accounting.

The problem of accounting standards is that they do not indicate the ownership of the transaction and the conformity of the transaction to the existing rules, laws and regulations. This article tries to answer the issue of regulation of public sector accounting standards. In this study using a pure literature survey and conclusions were drawn from theoretical analysis and discussion results. This research will add deeper insight into the theory of public sector accounting standards. Our research survey presents some of the thoughts of previous researchers regarding the regulatory theory of public sector accounting standards in pharmaceutical institutions. The results of our study show that the regulation of public sector accounting standards in pharmaceutical institutions has no relationship with non-profit organizations and government agencies. Regulation of public sector accounting standards in pharmaceutical agencies is very necessary for the Indonesian Institute of Accountants through the Public Sector Accountant Compartment together with the government and pharmaceutical industry associations as accountant organizations in Indonesia to draft Accounting Standards in the Pharmaceutical Industry considering that pharmaceuticals are very much needed by the public and there is a regulation of the Highest Retail Price issued by the Government.

Innovation is one of the efforts to improve performance in Islamic banking. The purpose of innovation is not only to reduce costs, but is a reason for improving the quality of products and services. This research aims to find out the development and management of product and service innovation in Islamic banking transactions. This research uses qualitative methods, where qualitative methods are a method that uses observation or interview. The findings in this study show that the innovation of services in transactions using Bittamlik's muntahiya ijarah aims to develop accommodating market needs and consumer needs. Because this transaction is a development of the ijarah transaction, the provisions also follow the provisions of Ijarah

Muamalat in Islam literally means transaction and technically means any mutual dealing that exist between two parties in order to solve their everyday needs, normally in trade and commerce. In Islamic economy, it is based on fiqh al-muamalat, which regulates the trading and commercial activities. There are three prohibited elements in transaction namely riba (interest), gharar (uncertainty), and maysir (gambling). However, certain Muslim community are still practising the trading that consist of these elements. An existence of many Islamic banks in Malaysia since 1983, however, seems unable to eliminate these elements in the Muslim’s daily life. Therefore, this paper aims to examine the awareness of the public regarding the practice of these three prohibited elements in their daily life. This study used quantitative method and employed descriptive studies. 150 questionnaires were distributed to the public using simple random sampling. Results found that there are lack of awareness o...

Zakat information in annual reports is one of the main attributes that differs Islamic banks from conventional banks. Thus, this study focuses on the zakat information that can be found in Islamic banks financial statements in comparison to the available standards. Reporting standards and guidelines from BNM, AAOIFI, JAWHAR and MASB were used by these banks as guidelines in calculating, distributing and reporting zakat. Due to the absence of standardized accounting standard, certain zakat information was not found in the financial statements. Compared to previous literatures, Islamic banks are moving towards increasing their zakat information disclosure. Based on the analysis of selected Islamic banks’ annual reports, this study concludes by suggesting establishment of standardized zakat distribution framework for Islamic banks. Keywords: Zakat, Reporting Standards, Disclosure, Financial Statement, Islamic Banks. Abstrak Maklumat tentang zakat dalam laporan tahunan adalah salah satu...

Zakat is one of the pillars of Islam and part of ibadah (obligation) for Muslims. Zakat has been identified as an important source of financial seed to jumpstart the economy of the Muslim community and give an impact to socio-economy development of a nation. Today, Zakat is no longer limited to the domain of religious or shari'ah studies and discourses, but an effort has been taken to restore back its function as a tools to strengthen Muslims economics. Many initiatives have been taken to facilitate its collection. An accounting standard relate to the Zakat payment MASB TRi-1 (Malaysian Accounting Standard, Technical Release Islamic-Number 1). Accounting for Zakat on Business, had been issued to facilitate the Zakat computation on business. The purpose of the release of MASB TRi-1 is to standardize the recognition, measurement, presentation and disclosure of zakat on business. However, MASB TRi-1 does not have the same weighted as standards. The objective of the study is to gauge the perception of accounting practitioners about MASB TRi-1. Questionnaires were sent to 282 accounting practitioners who have studied either Islamic accounting or Islamic finance. The finding revealed that most of the practitioners, regardless of their religious beliefs, are very keen to learn and deal with MASB TRi-1. Another encouraging finding is that the disclosure required by MASB TRi-1 encompasses the objective of Islamic Accounting.

Zakat is one of the pillars in Islam, a mandatory obligation to the Muslims. The payment of zakat is an expression of thankfulness to the Almighty God (Allah) and recognition of His rewards. Zakat is no longer perceived by many that is merely limited to the domain of religious or syariah studies and discourses, but has been widened to include the issue of social economics. Therefore, a proper treatment of zakat is needed. In Malaysia, an accounting treatment relating to the payment of zakat on business, TR-i1 had been issued by Malaysia Accounting Standard Board (MASB) to facilitate the computation of zakat on business. However, since zakat management is under the jurisdiction of State Islamic Religious Council (SIRC), the Technical Release 1 (TR-i1) issued just becomes a guideline which does not have the same weight as a standard. The objective of the paper is to investigate the level of compliance to the guidelines as being practiced by the listed Government Link Companies (GLCs). The study will focus on the methodology used for zakat computation and the disclosure being made in the annual report. All the 33 listed GLC companies were used for the study. From the result, it was found that the guidelines were not being followed. A practiced by GLC's was totally different from what has been mentioned in the TR-i1.

Economic crises are always resulted from greed, fraud, corruption, avarice, manipulating information, and creating financial assets without real economic activity. The main point is carrying out economic activities without moral and justice considerations. The Islamic economy is an economy that comes from the basis of Islamic teachings that emphasizes morality and justice. It is proven that Islamic banking is more stable compared to conventional banks in facing various economic and financial crises. Islam strictly forbids economic practices that are based on riba (usury), gharar (uncertainty), and maisir (gambling). The prohibition will ensure investment flows into the real sector for productive purposes. Islamic teachings see justice upholding and exploitation elimination as very important thing. Justice is the main element of upholding moral teachings that are based on Islamic values. Justice in the economic field has a principle that the property must not be centered on the rich, but must be equally spread over those who are weak.

Economic crises are always resulted from greed, fraud, corruption, avarice, manipulating information, and creating financial assets without real economic activity. The main point is carrying out economic activities without moral and justice considerations. The Islamic economy is an economy that comes from the basis of Islamic teachings that emphasizes morality and justice. It is proven that Islamic banking is more stable compared to conventional banks in facing various economic and financial crises. Islam strictly forbids economic practices that are based on riba (usury), gharar (uncertainty), and maisir (gambling). The prohibition will ensure investment flows into the real sector for productive purposes. Islamic teachings see justice upholding and exploitation elimination as very important thing. Justice is the main element of upholding moral teachings that are based on Islamic values. Justice in the economic field has a principle that the property must not be centered on the rich, but must be equally spread over those who are weak.

Zakat plays an important role in the economic development of the ummah. In line with Shariah requirements, the responsibility of paying zakat does not only lie in the Muslim individuals but also businesses, specifically Islamic banks. Islamic Banks exist to fulfil the financial (economic) needs of Muslims within the confines of the Islamic faith. This study aims to analyse the payment of zakat made by the Islamic Banks in Malaysia by firstly, examining the various methods adopted by the Islamic banks and secondly, comparing the existing method of zakat computation. A total of 16 Islamic banks are selected and the financial statements are reviewed from the year 2013 till 2017. The results of the study show that most of the Islamic banks adopted the two methods recommended by JAKIM and both methods show similar results. The results also show an underpayment of zakat by the selected Islamic bank. Further the study found that the detail computation of zakat is not disclosed in the finan...

The aspect of transparency and clarity in Islamic mualamalah contract are vital for any form of business activities in order to comply with the Shariah principle. The element of “gharar” or unknown and uncertainty are totally not permissible by Shariah, as it will contribute to injustice to social economics. The AlQuran has clearly forbidden all business transaction which causes injustice for any people as towards the society. Zakat on business which is calculated based on growth level or net working capital level is compulsory obligation for Muslims which the objectives to purify and growth the wealth. Hence, this paper discussed the issue of Zakat reporting and the need for Zakat accounting standard for the emerging Islamic capital market. An investigation on the Zakat reporting was carried out on 830 Shariah-compliant companies listed on Bursa Malaysia The samples comprised of Shariah-compliant companies from nine sectors: financial institutions, construction, consumer products, ...

PurposeThe purpose of this paper is to review the accounting treatments for corporate zakat, as advocated by accounting standards and guidelines, as well as those been practised by relevant corporations. The aim is to determine their appropriateness and adherence to both the Islamic as well as the accounting theoretical perspectives.Design/methodology/approachAccounting standards and guidelines related to zakat, including the Financial Accounting Standard No. 9 and the Technical Release i‐1, are examined. Additionally, analyses are made on the practices of Islamic financial institutions to determine their compliance with both standards and ontological aspects of zakat.FindingsThe study reveals that there is a general misconception of zakat, as indicated in several standards and guidelines, which has consequently resulted in inappropriateness in their proposed corporate zakat recognition and measurement and hence presentations. These inaccuracies, in one way or another, have not been...

Declaration I hereby declare that this thesis has never previously been submitted for any other degree and is the result of m y o w n independent research. M u h a m m a d Akhyar Adnan All the praise and grateful only be to Allah, the Cherisher and Sustainer of the Worlds, the Creator and the Owner of everything, simply because only by His will and permission this study can be completed. I would like to express many thanks to Professor Michael Gaffikin, w h o was m y supervisor during the period of study. His encouragement, support and patience means a great deal to m e. I highly appreciate his efforts.

Purpose – The purpose of this paper is to review the accounting treatments for corporate zakat, as advocated by accounting standards and guidelines, as well as those been practised by relevant corporations. The aim is to determine their appropriateness and adherence to both the Islamic as well as the accounting theoretical perspectives. Design/methodology/approach – Accounting standards and guidelines related to zakat, including the Financial Accounting Standard No. 9 and the Technical Release i-1, are examined. Additionally, analyses are made on the practices of Islamic financial institutions to determine their compliance with both standards and ontological aspects of zakat. Findings – The study reveals that there is a general misconception of zakat, as indicated in several standards and guidelines, which has consequently resulted in inappropriateness in their proposed corporate zakat recognition and measurement and hence presentations. These inaccuracies, in one way or another, ha...

Declaration I hereby declare that this thesis has never previously been submitted for any other degree and is the result of m y o w n independent research. M u h a m m a d Akhyar Adnan All the praise and grateful only be to Allah, the Cherisher and Sustainer of the Worlds, the Creator and the Owner of everything, simply because only by His will and permission this study can be completed. I would like to express many thanks to Professor Michael Gaffikin, w h o was m y supervisor during the period of study. His encouragement, support and patience means a great deal to m e. I highly appreciate his efforts.

Fakulti Ekonomi dan Muamalat, Universiti Sains Islam Malaysia telah meneruskan tradisi untuk menganjurkan satu program trademark iaitu ‘Talk@FEM’ bagi siri September 2021. Pada program Talk@FEM kali ini, tajuk yang dipilih adalah ‘Audit Engagement in Islamic Financial Institutions: Issues & Challenges’. Program ini telah dijalankan pada hari Rabu bermula jam 2.30 petang sehingga 4.30 petang melalui aplikasi Zoom. Seramai kira-kira 46 peserta telah menghadiri program kali ini melibatkan para pensyarah dan pelajar USIM, ahli akademik dari universiti tempatan dan juga pemain industri yang berkaitan. Tujuan program ini diadakan adalah sebagai wadah perkongsian, perbincangan dan percambahan idea secara santai bagi membincangkan isu-isu dan cabaran dalam pelaksanaan audit di institusi kewangan Islam.

Purpose – The purpose of this paper is to review the accounting treatments for corporate zakat, as advocated by accounting standards and guidelines, as well as those been practised by relevant corporations. The aim is to determine their appropriateness and adherence to both the Islamic as well as the accounting theoretical perspectives. Design/methodology/approach – Accounting standards and guidelines related to zakat, including the Financial Accounting Standard No. 9 and the Technical Release i-1, are examined. Additionally, analyses are made on the practices of Islamic financial institutions to determine their compliance with both standards and ontological aspects of zakat. Findings – The study reveals that there is a general misconception of zakat, as indicated in several standards and guidelines, which has consequently resulted in inappropriateness in their proposed corporate zakat recognition and measurement and hence presentations. These inaccuracies, in one way or another, ha...

Purpose – The purpose of this paper is to review the accounting treatments for corporate zakat, as advocated by accounting standards and guidelines, as well as those been practised by relevant corporations. The aim is to determine their appropriateness and adherence to both the Islamic as well as the accounting theoretical perspectives. Design/methodology/approach – Accounting standards and guidelines related to zakat, including the Financial Accounting Standard No. 9 and the Technical Release i-1, are examined. Additionally, analyses are made on the practices of Islamic financial institutions to determine their compliance with both standards and ontological aspects of zakat. Findings – The study reveals that there is a general misconception of zakat, as indicated in several standards and guidelines, which has consequently resulted in inappropriateness in their proposed corporate zakat recognition and measurement and hence presentations. These inaccuracies, in one way or another, ha...

Declaration I hereby declare that this thesis has never previously been submitted for any other degree and is the result of m y o w n independent research. M u h a m m a d Akhyar Adnan All the praise and grateful only be to Allah, the Cherisher and Sustainer of the Worlds, the Creator and the Owner of everything, simply because only by His will and permission this study can be completed. I would like to express many thanks to Professor Michael Gaffikin, w h o was m y supervisor during the period of study. His encouragement, support and patience means a great deal to m e. I highly appreciate his efforts.

This study aims to describe the role of Islamic economic and finance in renewable energy programs in Indonesia. This research is a qualitative descriptive research through library research and content analysis method. The results show that the role of Islamic economic and finance in renewable energy programs in Indonesia is realized in several forms. First, sharia financial sector can be one of the options for renewable energy investment financing instruments. Second, the utilization of renewable energy can be the supporter and spearhead of the halal industry. Third, in a religious social context, renewable energy financing can be done with the concept of ta‘āwun and jāriyah alms through crowd funding and waqf. In order to optimize the role of sharia economy and finance in renewable energy programs in Indonesia, several steps and activities that can be done include: (1) intensifying the campaign against the excellence of renewable energy; (2) providing easy access and renewable ener...

Declaration I hereby declare that this thesis has never previously been submitted for any other degree and is the result of m y o w n independent research. M u h a m m a d Akhyar Adnan All the praise and grateful only be to Allah, the Cherisher and Sustainer of the Worlds, the Creator and the Owner of everything, simply because only by His will and permission this study can be completed. I would like to express many thanks to Professor Michael Gaffikin, w h o was m y supervisor during the period of study. His encouragement, support and patience means a great deal to m e. I highly appreciate his efforts.

Purpose-The purpose of this paper is to review the accounting treatments for corporate zakat, as advocated by accounting standards and guidelines, as well as those been practised by relevant corporations. The aim is to determine their appropriateness and adherence to both the Islamic as well as the accounting theoretical perspectives. Design/methodology/approach-Accounting standards and guidelines related to zakat, including the Financial Accounting Standard No. 9 and the Technical Release i-1, are examined. Additionally, analyses are made on the practices of Islamic financial institutions to determine their compliance with both standards and ontological aspects of zakat. Findings-The study reveals that there is a general misconception of zakat, as indicated in several standards and guidelines, which has consequently resulted in inappropriateness in their proposed corporate zakat recognition and measurement and hence presentations. These inaccuracies, in one way or another, have not been in line with the true spirit of zakat in Islam. More worryingly, some unfavorable consequences may and in fact have already been implicated on the larger Muslim community as a result. Research limitations/implications-An alternative view on the accounting treatment of corporate zakat is offered in this paper with the aim to provide a fair and proper assessment of zakat on corporate wealth, which is more parallel to the true spirit of zakat. Originality/value-The paper integrates both the revealed and the contemporary accounting knowledge in scrutinizing the standards and practices as well as in recommending an improved and meaningful alternative.

Declaration I hereby declare that this thesis has never previously been submitted for any other degree and is the result of m y o w n independent research. M u h a m m a d Akhyar Adnan All the praise and grateful only be to Allah, the Cherisher and Sustainer of the Worlds, the Creator and the Owner of everything, simply because only by His will and permission this study can be completed. I would like to express many thanks to Professor Michael Gaffikin, w h o was m y supervisor during the period of study. His encouragement, support and patience means a great deal to m e. I highly appreciate his efforts.

Purpose – The purpose of this paper is to review the accounting treatments for corporate zakat, as advocated by accounting standards and guidelines, as well as those been practised by relevant corporations. The aim is to determine their appropriateness and adherence to both the Islamic as well as the accounting theoretical perspectives. Design/methodology/approach – Accounting standards and guidelines related to zakat, including the Financial Accounting Standard No. 9 and the Technical Release i-1, are examined. Additionally, analyses are made on the practices of Islamic financial institutions to determine their compliance with both standards and ontological aspects of zakat. Findings – The study reveals that there is a general misconception of zakat, as indicated in several standards and guidelines, which has consequently resulted in inappropriateness in their proposed corporate zakat recognition and measurement and hence presentations. These inaccuracies, in one way or another, ha...

Purpose – The purpose of this paper is to review the accounting treatments for corporate zakat, as advocated by accounting standards and guidelines, as well as those been practised by relevant corporations. The aim is to determine their appropriateness and adherence to both the Islamic as well as the accounting theoretical perspectives. Design/methodology/approach – Accounting standards and guidelines related to zakat, including the Financial Accounting Standard No. 9 and the Technical Release i-1, are examined. Additionally, analyses are made on the practices of Islamic financial institutions to determine their compliance with both standards and ontological aspects of zakat. Findings – The study reveals that there is a general misconception of zakat, as indicated in several standards and guidelines, which has consequently resulted in inappropriateness in their proposed corporate zakat recognition and measurement and hence presentations. These inaccuracies, in one way or another, ha...

This paper reviews the accounting treatment for zakat. Few articles or books have been written on this topic (with the notable exception of Al-Moghaiwli 2001; Mursyidi, 2003, Al-Habshi, 2005). However several zakat accounting standards and guidelines have been promulgated and developed. This includes the Financial Accounting Standard (FAS) No. 9 by the Accounting and Auditing Organization for Financial Islamic Institutions (AAOIFI), the Technical Release i-1 (TR i-1) on 'Accounting for Zakat on Business' and the Financial Reporting Standard (FRS i-1) by the Malaysian Accounting Standard Board. This paper first reviews these articles and accounting standards. In turn a theoretical examination from both religious as well as from theoretical accounting perspectives is suggested. Some analysis on the practices of Islamic banks and financial institutions will be also carried out to ensure their compliance with both standards promulgated and ontological aspects of zakat. It is expected that this paper may contribute an alternative view to enrich and improve the accounting treatment for zakat. In turn it is hoped that this will contribute towards a better collection and disbursement of the zakat system, for Islamic commercial institutions in particular, as well as for other business organizations in general.