Perception of small- and medium-sized enterprises in Klang Valley, Malaysia towards profit and loss sharing mode of financing

Equity financing on the basis of profit and loss sharing (PLS) had long been proposed by Muslim scholars to be the prevalent method of funding to businesses. This is so because scholars believe that this particular funding method is able to meet the true spirit of equitable distribution of income an...

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Main Authors:	Ab. Manan, Siti Khadijah, Abdullah, Moha Asri
Format:	Article
Language:	English
Published:	Faculty of Economics and Administration, University of Malaya 2012
Subjects:	HB71 Economics as a science
Online Access:	http://irep.iium.edu.my/29209/ http://irep.iium.edu.my/29209/1/Perception_of_Small-_and_Medium-Sized_Enterprises.pdf

id	iium-29209
recordtype	eprints
spelling	iium-292092013-02-27T23:35:06Z http://irep.iium.edu.my/29209/ Perception of small- and medium-sized enterprises in Klang Valley, Malaysia towards profit and loss sharing mode of financing Ab. Manan, Siti Khadijah Abdullah, Moha Asri HB71 Economics as a science Equity financing on the basis of profit and loss sharing (PLS) had long been proposed by Muslim scholars to be the prevalent method of funding to businesses. This is so because scholars believe that this particular funding method is able to meet the true spirit of equitable distribution of income and wealth, hence materialising the goals of the shariah (maqasid al-shariah) in the economy. In addition, they viewed that a balanced proportion of equity and debt in a firm's financial structure would be able to yield a handsome return as the mode promotes participation and hard work while at the same time motivates business expansion and growth. Nevertheless, theoretical perceptions of the scholars on the mode would be less meaningful without ground support from businesses. This study therefore examines the perception of entrepreneurs towards PLS-equity financing. The small and medium-sized enterprises (SMEs) are chosen as samples of the study as these enterprises constitute the majority of business establishments in Malaysia. The study found a favourable finding in support of the scholars' view. The study proposes that PLS equity financing should be given premier attention by the respective bodies and agencies as current practices seldom offer this mode to businesses particularly smaller enterprises. Faculty of Economics and Administration, University of Malaya 2012-06 Article PeerReviewed application/pdf en http://irep.iium.edu.my/29209/1/Perception_of_Small-_and_Medium-Sized_Enterprises.pdf Ab. Manan, Siti Khadijah and Abdullah, Moha Asri (2012) Perception of small- and medium-sized enterprises in Klang Valley, Malaysia towards profit and loss sharing mode of financing. Malaysian Journal of Economic Studies , 49 (1). pp. 37-48. ISSN 1511-4554
repository_type	Digital Repository
institution_category	Local University
institution	International Islamic University Malaysia
building	IIUM Repository
collection	Online Access
language	English
topic	HB71 Economics as a science
spellingShingle	HB71 Economics as a science Ab. Manan, Siti Khadijah Abdullah, Moha Asri Perception of small- and medium-sized enterprises in Klang Valley, Malaysia towards profit and loss sharing mode of financing
description	Equity financing on the basis of profit and loss sharing (PLS) had long been proposed by Muslim scholars to be the prevalent method of funding to businesses. This is so because scholars believe that this particular funding method is able to meet the true spirit of equitable distribution of income and wealth, hence materialising the goals of the shariah (maqasid al-shariah) in the economy. In addition, they viewed that a balanced proportion of equity and debt in a firm's financial structure would be able to yield a handsome return as the mode promotes participation and hard work while at the same time motivates business expansion and growth. Nevertheless, theoretical perceptions of the scholars on the mode would be less meaningful without ground support from businesses. This study therefore examines the perception of entrepreneurs towards PLS-equity financing. The small and medium-sized enterprises (SMEs) are chosen as samples of the study as these enterprises constitute the majority of business establishments in Malaysia. The study found a favourable finding in support of the scholars' view. The study proposes that PLS equity financing should be given premier attention by the respective bodies and agencies as current practices seldom offer this mode to businesses particularly smaller enterprises.
format	Article
author	Ab. Manan, Siti Khadijah Abdullah, Moha Asri
author_facet	Ab. Manan, Siti Khadijah Abdullah, Moha Asri
author_sort	Ab. Manan, Siti Khadijah
title	Perception of small- and medium-sized enterprises in Klang Valley, Malaysia towards profit and loss sharing mode of financing
title_short	Perception of small- and medium-sized enterprises in Klang Valley, Malaysia towards profit and loss sharing mode of financing
title_full	Perception of small- and medium-sized enterprises in Klang Valley, Malaysia towards profit and loss sharing mode of financing
title_fullStr	Perception of small- and medium-sized enterprises in Klang Valley, Malaysia towards profit and loss sharing mode of financing
title_full_unstemmed	Perception of small- and medium-sized enterprises in Klang Valley, Malaysia towards profit and loss sharing mode of financing
title_sort	perception of small- and medium-sized enterprises in klang valley, malaysia towards profit and loss sharing mode of financing
publisher	Faculty of Economics and Administration, University of Malaya
publishDate	2012
url	http://irep.iium.edu.my/29209/ http://irep.iium.edu.my/29209/1/Perception_of_Small-_and_Medium-Sized_Enterprises.pdf
first_indexed	2023-09-18T20:42:51Z
last_indexed	2023-09-18T20:42:51Z
_version_	1777409481037053952

Perception of small- and medium-sized enterprises in Klang Valley, Malaysia towards profit and loss sharing mode of financing

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