Prospects of a Shariah audit framework for Islamic financial institutions in Malaysia

The need to be in conformity with religious and ethical principles, or to be Shariah compliant, is the unique and distinctive feature of Islamic finance which sets it apart from its conventional counterpart. Islamic financial institutions (IFIs) are to be audited not only on financial performances b...

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Main Author:	Yussof, Sheila Ainon
Format:	Article
Language:	English
Published:	International Institute of Advanced Islamic Studies (IAIS) Malaysia. 2013
Subjects:	HG1501 Banking
Online Access:	http://irep.iium.edu.my/48849/ http://irep.iium.edu.my/48849/ http://irep.iium.edu.my/48849/1/131-518-1-PB.pdf

id	iium-48849
recordtype	eprints
spelling	iium-488492016-07-18T00:43:40Z http://irep.iium.edu.my/48849/ Prospects of a Shariah audit framework for Islamic financial institutions in Malaysia Yussof, Sheila Ainon HG1501 Banking The need to be in conformity with religious and ethical principles, or to be Shariah compliant, is the unique and distinctive feature of Islamic finance which sets it apart from its conventional counterpart. Islamic financial institutions (IFIs) are to be audited not only on financial performances but also on their adherence to Shariah precepts, including broader ethical and moral parameters. Currently there is no proper framework to govern the practice of internal Shariah auditing in IFIs. The recently issued Central Bank of Malaysia’s Shariah Governance Framework (CBM-SGF) has made it compulsory for IFIs to perform a regular internal audit of transactions, operations and information systems particularly at the product implementation stage to ensure a comprehensive compliance with Shariah. This has posed a challenge to Islamic banks and Takaful companies, to develop their own internal Shariah audit architecture and to train a new breed of internal auditors in the science and ethics of Shariah audit based on generalised guidelines under the new directive. This paper highlights persistent problems relating to inadequate auditing at the business operations level and prevailing issues in Shariah audit. Recommendations are made for the industry to adopt a common internal Shariah audit framework as a move towards standardisation and uniformity of audit practice. International Institute of Advanced Islamic Studies (IAIS) Malaysia. 2013-01 Article PeerReviewed application/pdf en http://irep.iium.edu.my/48849/1/131-518-1-PB.pdf Yussof, Sheila Ainon (2013) Prospects of a Shariah audit framework for Islamic financial institutions in Malaysia. Islam and Civilisational Renewal, 4 (1). pp. 80-102. ISSN 2041–871X E-ISSN 2041–8728 http://www.iais.org.my/icr/index.php/icr/article/view/131/127
repository_type	Digital Repository
institution_category	Local University
institution	International Islamic University Malaysia
building	IIUM Repository
collection	Online Access
language	English
topic	HG1501 Banking
spellingShingle	HG1501 Banking Yussof, Sheila Ainon Prospects of a Shariah audit framework for Islamic financial institutions in Malaysia
description	The need to be in conformity with religious and ethical principles, or to be Shariah compliant, is the unique and distinctive feature of Islamic finance which sets it apart from its conventional counterpart. Islamic financial institutions (IFIs) are to be audited not only on financial performances but also on their adherence to Shariah precepts, including broader ethical and moral parameters. Currently there is no proper framework to govern the practice of internal Shariah auditing in IFIs. The recently issued Central Bank of Malaysia’s Shariah Governance Framework (CBM-SGF) has made it compulsory for IFIs to perform a regular internal audit of transactions, operations and information systems particularly at the product implementation stage to ensure a comprehensive compliance with Shariah. This has posed a challenge to Islamic banks and Takaful companies, to develop their own internal Shariah audit architecture and to train a new breed of internal auditors in the science and ethics of Shariah audit based on generalised guidelines under the new directive. This paper highlights persistent problems relating to inadequate auditing at the business operations level and prevailing issues in Shariah audit. Recommendations are made for the industry to adopt a common internal Shariah audit framework as a move towards standardisation and uniformity of audit practice.
format	Article
author	Yussof, Sheila Ainon
author_facet	Yussof, Sheila Ainon
author_sort	Yussof, Sheila Ainon
title	Prospects of a Shariah audit framework for Islamic financial institutions in Malaysia
title_short	Prospects of a Shariah audit framework for Islamic financial institutions in Malaysia
title_full	Prospects of a Shariah audit framework for Islamic financial institutions in Malaysia
title_fullStr	Prospects of a Shariah audit framework for Islamic financial institutions in Malaysia
title_full_unstemmed	Prospects of a Shariah audit framework for Islamic financial institutions in Malaysia
title_sort	prospects of a shariah audit framework for islamic financial institutions in malaysia
publisher	International Institute of Advanced Islamic Studies (IAIS) Malaysia.
publishDate	2013
url	http://irep.iium.edu.my/48849/ http://irep.iium.edu.my/48849/ http://irep.iium.edu.my/48849/1/131-518-1-PB.pdf
first_indexed	2023-09-18T21:09:12Z
last_indexed	2023-09-18T21:09:12Z
_version_	1777411138112192512

Prospects of a Shariah audit framework for Islamic financial institutions in Malaysia

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