P. 1
Islamic Accounting

Islamic Accounting

|Views: 114|Likes:
Published by Mohamed Qubati

More info:

Published by: Mohamed Qubati on Jun 10, 2011
Copyright:Attribution Non-commercial


Read on Scribd mobile: iPhone, iPad and Android.
download as PDF, TXT or read online from Scribd
See more
See less





The Effect Of Shariah Principles on Accounting Methods for Islamic Banks

10 November 2010

Daud Vicary Abdullah, CIFP Global Islamic Finance Leader, Deloitte.

Agenda Rapid Acceptance of Islamic Finance The fundamental principles of Islamic Finance Issues & Supporting Infrastructures In Islamic Accounting Perceived Gaps & Possible Solutions 2 .

Rapid Acceptance of Islamic Finance Increasing pressure to have global standards Global Crisis Product Development & Innovation Increasing Market demand Islamic Finance Opportunities Access to Liquidity Increasing Muslim Population Government & Infrastructure Support 3 .

The Fundamental Principles of Islamic Finance An overview No conflict with Principle of Islam & Assertion of Religious Law Risk & profit sharing Real Economic Transactions & Asset Backed Ethical Value & Social Justice (Maqasid AlShariah) Prohibited Activities & Elements Islamic Finance 4 .

Islamic Finance : Issues & Supporting Infrastructures Key issues & who is responsible for what • Substance Vs. . Governance Framework • Ensure consistency in requirements and policies concerning reporting practices • Roles & duties between Shariah Advisors and Auditors AAOIFI IFSB IIFM Local Shariah Board 5 & Local Regulators. Financial Reporting • Harmonisation of accounting standards • Flexibility and transformation with the development of Islamic financial innovations • Building consumer’s confidence and trust AAOIFI IFSB IFRS Auditing • Ex-Ante compliance & Ex-post compliance • Lack of expertise & human capital AAOIFI IFRS Local Shariah Board & Local Regulators. Form • Liability & equity • Interest & dividend • Ownership in Sukuk & Sukuk Default Accounting AAOIFI IFRS Local Shariah Board & Local Regulators.

Convergence Applying IFRS in every aspect 6 .Islamic Finance : Issues in Islamic Accounting The possible roadmap Live side by side with its conventional counterpart Exclusivity All Islamic financial institution transactions will be recorded by way of Islamic Accounting 3 options International Financial Reporting Standards (IFRS) are fine tuned Harmonisation The certain exemptions are allowed/disallowed.

Perceived Gaps & Possible Solutions The way moving forward Having the right perception Misperception & Unanimity in understanding Shariah law Research & development Shortage of literature & research on Islamic accounting Perceived gaps & Possible Solutions Shortage of Islamic accounting expert & human capital Education & Training Lack of understanding of Islamic finance opportunities Perceived gaps Possible Solutions Articulating value proposition 7 .

CIFP Global Islamic Finance Leader Deloitte Email : dvicary@deloitte.islamicfinance.deloitte.com Tel : +603 77236500. 77261833 Website : www.Any Questions? Daud Vicary Abdullah.com 8 .

THANK YOU! 10 November 2010 9 .

You're Reading a Free Preview

/*********** DO NOT ALTER ANYTHING BELOW THIS LINE ! ************/ var s_code=s.t();if(s_code)document.write(s_code)//-->