An exploratory study of Ijarah accounting practices in Malaysian financial institutions

Prior studies on Ijarah were mainly focusing on the economics, legal and ﬁnancial aspects, there was, however, so far no in- depth study on accounting for Ijarah. The main objective of this study is to explore the nature of accounting practices as practiced by Malaysian ﬁnancial institutions. First,...

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Main Authors:	Mohd. Shariff, Ros Aniza, Abdul Rahman, Abdul Rahim
Format:	Article
Language:	English
Published:	Centre fo r Indonesian Accounting and Management Research, Brawijaya University 2005
Subjects:	HB126.4 Islamic Economics HF5601 Accounting. Bookkeeping HG3368 Islamic Banking and Finance
Online Access:	http://irep.iium.edu.my/24989/ http://irep.iium.edu.my/24989/ http://irep.iium.edu.my/24989/1/73099_An%20exploratory%20study%20of%20Ijarah.pdf

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recordtype	eprints
spelling	iium-249892019-08-08T04:20:12Z http://irep.iium.edu.my/24989/ An exploratory study of Ijarah accounting practices in Malaysian financial institutions Mohd. Shariff, Ros Aniza Abdul Rahman, Abdul Rahim HB126.4 Islamic Economics HF5601 Accounting. Bookkeeping HG3368 Islamic Banking and Finance Prior studies on Ijarah were mainly focusing on the economics, legal and ﬁnancial aspects, there was, however, so far no in- depth study on accounting for Ijarah. The main objective of this study is to explore the nature of accounting practices as practiced by Malaysian ﬁnancial institutions. First, the study makes comparison between the Intemational Accounting Standard on leasing (IAS 17); the accounting standard for Ijarah (FAS 8) as developed by the Accounting and Auditing Organization for lslamic Financial Institutions (AAOIFI); and the Malaysian Accounting Standard Board (MASB 10). The study found that there are major differences as to the nature of leasing and Ijarah, and as a result accounting principles that have driven all the three standards as well as accounting techniques developed for leasing and Ijarah are signiﬁcantly different. Secondly, the study examines the level of acceptability of the AAOlFI's FAS 8 among the Malaysian ﬁnancial institutions. The result of the questionnaire survey shows a low level of acceptability of FAS 8 and the result from the interviewsurvey further conﬁrms this ﬁnding. This study indicates, subject to further studies on other lslamic ﬁnancial instruments and other lslamic countries, that the effort to harmonise the accounting practices on lslamic ﬁnancing practices by ﬁnancial institutions Internationally may be a difficult task. Secondly, until and unless the AAOIFI standard is adopted by the regulatory agency as in the case of Malaysia, Bank Negara Malaysia, AAOIFI standards will remain only as a reference but do not have the legal authority. Consequently, the quality and comparability of accounting information of lslamic ﬁnancing such as Ijarah will be seriously at a stake. Centre fo r Indonesian Accounting and Management Research, Brawijaya University 2005-12 Article PeerReviewed application/pdf en http://irep.iium.edu.my/24989/1/73099_An%20exploratory%20study%20of%20Ijarah.pdf Mohd. Shariff, Ros Aniza and Abdul Rahman, Abdul Rahim (2005) An exploratory study of Ijarah accounting practices in Malaysian financial institutions. The International Journal o f Accounting and Business Society, 13 (1/2). pp. 45-68. https://media.neliti.com/media/publications/70399-EN-an-exploratory-study-of-accounting-on-ij.pdf
repository_type	Digital Repository
institution_category	Local University
institution	International Islamic University Malaysia
building	IIUM Repository
collection	Online Access
language	English
topic	HB126.4 Islamic Economics HF5601 Accounting. Bookkeeping HG3368 Islamic Banking and Finance
spellingShingle	HB126.4 Islamic Economics HF5601 Accounting. Bookkeeping HG3368 Islamic Banking and Finance Mohd. Shariff, Ros Aniza Abdul Rahman, Abdul Rahim An exploratory study of Ijarah accounting practices in Malaysian financial institutions
description	Prior studies on Ijarah were mainly focusing on the economics, legal and ﬁnancial aspects, there was, however, so far no in- depth study on accounting for Ijarah. The main objective of this study is to explore the nature of accounting practices as practiced by Malaysian ﬁnancial institutions. First, the study makes comparison between the Intemational Accounting Standard on leasing (IAS 17); the accounting standard for Ijarah (FAS 8) as developed by the Accounting and Auditing Organization for lslamic Financial Institutions (AAOIFI); and the Malaysian Accounting Standard Board (MASB 10). The study found that there are major differences as to the nature of leasing and Ijarah, and as a result accounting principles that have driven all the three standards as well as accounting techniques developed for leasing and Ijarah are signiﬁcantly different. Secondly, the study examines the level of acceptability of the AAOlFI's FAS 8 among the Malaysian ﬁnancial institutions. The result of the questionnaire survey shows a low level of acceptability of FAS 8 and the result from the interviewsurvey further conﬁrms this ﬁnding. This study indicates, subject to further studies on other lslamic ﬁnancial instruments and other lslamic countries, that the effort to harmonise the accounting practices on lslamic ﬁnancing practices by ﬁnancial institutions Internationally may be a difficult task. Secondly, until and unless the AAOIFI standard is adopted by the regulatory agency as in the case of Malaysia, Bank Negara Malaysia, AAOIFI standards will remain only as a reference but do not have the legal authority. Consequently, the quality and comparability of accounting information of lslamic ﬁnancing such as Ijarah will be seriously at a stake.
format	Article
author	Mohd. Shariff, Ros Aniza Abdul Rahman, Abdul Rahim
author_facet	Mohd. Shariff, Ros Aniza Abdul Rahman, Abdul Rahim
author_sort	Mohd. Shariff, Ros Aniza
title	An exploratory study of Ijarah accounting practices in Malaysian financial institutions
title_short	An exploratory study of Ijarah accounting practices in Malaysian financial institutions
title_full	An exploratory study of Ijarah accounting practices in Malaysian financial institutions
title_fullStr	An exploratory study of Ijarah accounting practices in Malaysian financial institutions
title_full_unstemmed	An exploratory study of Ijarah accounting practices in Malaysian financial institutions
title_sort	exploratory study of ijarah accounting practices in malaysian financial institutions
publisher	Centre fo r Indonesian Accounting and Management Research, Brawijaya University
publishDate	2005
url	http://irep.iium.edu.my/24989/ http://irep.iium.edu.my/24989/ http://irep.iium.edu.my/24989/1/73099_An%20exploratory%20study%20of%20Ijarah.pdf
first_indexed	2023-09-18T20:37:22Z
last_indexed	2023-09-18T20:37:22Z
_version_	1777409135287992320

An exploratory study of Ijarah accounting practices in Malaysian financial institutions

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