2020 iBAF

Shariah audit has currently emerged as an important mechanism in ensuring Shariah compliance in line with the rapid development of Islamic Banking. It strengthens the Shariah compliance and enhance the integrity of Islamic Financial Institutions (IFIs) due to the uniqueness features of the IFIs such as the prohibition of riba, gharar, maysir and other requirements that its activities must be in compliance with Shariah. Research on audit expectations gap in Shariah audit practices has received little attention by researchers. Two objectives are set in this study; these are: Firstly, to examine the perceptions of the internal auditors (Shariah auditors), regulators (BNM), Shariah committee, Shariah officers, external auditors and depositors concerning the Shariah audit practices in the Islamic banks in Malaysia. Secondly, to determine the existence of expectations-performance gap between internal auditors (Shariah auditors), regulators (BNM), Shariah committee, Shariah officers’ external auditors and depositors concerning the Shariah auditor’s performance in the Islamic banks in Malaysia. Based on the findings there is existence of gap in Shariah audit practices and auditor’s performance. Thus, there is a need to strengthen the Shariah audit practices in the Islamic banks to ensure greater effectiveness of the goals of Shariah compliance. The research provides new insights into the structure, composition and extent of the audit expectation-performance gap in Shariah audit practices but, more importantly, it signals a rational, comprehensive approach towards narrowing the gap. This should bring practitioner’s and stakeholders's expectations on Shariah audit practices and Shariah auditors' performance into closer accord and, as a consequence, reduce the criticism and different expectations on the Shariah audit practices in the Islamic banks.

Nowadays, there are so many things that affect investors in making decisions, as obtained through experience or the intelligence. When these two things combine, it can form a different action for each investor. The aims of this study are to find out the effect of spiritual intelligence and financial experience on investment decision among Muslim scholars in Sumbawa University of Technology. Sumbawa University of Technology is located in West Nusa Tenggara, a province with Muslim-majority population that known for the strong nuances of Islam. Data were collected by using questionnaire method from the respondents that become sample in this research. There are 62 scholars selected as respondents using the Slovin formula with an error margin of 10%. To test hypotheses, this study employs multiple regression analysis. Moreover, by performing multiple regression analysis, the findings shown that only financial experience has an effect on personal investment decision, but spiritual intelligence does not.

This study investigated the impact of market risk on the market value, using panel data evidence from the annual reports and financial statements of 8 listed deposit money banks in Nigeria over a 10-year period from 2010 to 2019. Descriptive statistics and random effects model were utilised in the analysis of data. Results indicate that degree of financial leverage has significant and positive impact on the market value, while interest rate risk and foreign exchange exposure have no significant impact on the market value measured by Tobin’s Q. The study concludes that listed deposit money banks in Nigeria were able to trade-off the tax shields benefit of debt against the cost of financial distress; thereby expanding their earnings. The study recommends that banks should expand their investment in fixed income securities in order to increase their earnings.

Pandemik Covid-19 yang melanda seluruh dunia bukan sahaja memberi implikasi kepada kesihatan, malah kepada ekonomi dan pasaran buruh. Hampir 40 peratus daripada keseluruhan tenaga buruh di Malaysia merupakan golongan belia yang berusia 15 hingga 29 tahun. Tidak dapat dinafikan bahawa golongan ini adalah golongan penting kepada pasaran buruh negara dan berperanan sebagai tunjang kemakmuran ekonomi negara. Justeru, kesan semasa dan selepas Covid-19 kepada belia tidak boleh dipandang ringan. Kadar pengangguran dijangka meningkat kepada 5.5 peratus atau lebih 860,000 orang penganggur sepanjang tahun 2020 di Malaysia. Bank Negara Malaysia turut mengumumkan peningkatan unjuran kadar pengangguran kepada 4 peratus untuk tahun 2020. Graduan baharu turut menerima tempias penguncupan ekonomi akibat krisis Covid-19 melalui penawaran pekerjaan yang terhad. Dengan jumlah keluaran graduan ke pasaran buruh sebanyak lebih 200,000 setiap tahun, sudah pastinya mereka akan menghadapi kesukaran untuk mendapatkan kerja. Bagi yang mengekalkan pekerjaan pula, berdepan kehilangan pendapatan 90 peratus dan tidak mempunyai simpanan cukup untuk meneruskan kelangsungan hidup. Justeru, pelbagai inisiatif dilaksanakan oleh Kementerian Sumber Manusia bagi mengatasi permasalahan tersebut menerusi Pelan Jana Semula Ekonomi Negara (PENJANA) yang dibentangkan oleh Perdana Menteri Malaysia pada 5 Jun 2020. Melalui PENJANA, insentif pengambilan pekerja telah menyediakan lebih 300,000 graduan baharu dan belia yang menganggur termasuk perantis untuk menerima manfaat daripada insentif ini. Maka, artikel ini bertujuan mengupas cabaran dan survival kewangan belia berdepan krisis Covid-19 dengan mengaplikasikan kaedah kualitatif menerusi analisa dokumen dan data sumber sekunder. Artikel ini turut menjelaskan langkah-langkah kerajaan menangani isu pengganguran di kalangan belia. Hasil perbincangan mendapati bahawa krisis Covid-19 menuntut semua pihak untuk melakukan pengubahsuaian dalam cara hidup termasuklah dalam menguruskan kewangan. Peluang yang diberikan pihak kerajaan dalam mengatasi ekonomi belia khususnya sektor pekerjaan haruslah direbut sebaik mungkin.

Internet Financial Reporting is the use of corporations’ websites in disseminating financial information. Numerous advantages offered by internet financial reporting as the latest and modern tools for business reporting as compared to conventional way of reporting reflects to irrefutable, increase and extensive use of internet financial reporting amongst corporations in emerging economics countries. The quality of financial reporting is influenced by the corporate governance practiced by the corporations. Strong corporate governance is said to inspire companies to have better quality of financial reporting. This study attempts to investigate the affiliation between specific corporate governance characteristics and the extent of internet financial reporting espousal by 100 top Malaysia public listed companies listed by the Minority Shareholders Watch Group (MSWG). Data is analyzed by using multiple regression. The study revealed that internet financial reporting by the corporations are significantly influenced by characteristics of corporate governance namely board meeting and board size in a positive way. However, board diversity, audit committee financial expert and board independence are found to be insignificant in inspiring practice of internet financial reporting amongst the corporations. The study provides empirical evidence on the contribution of board meeting and board size on internet financial reporting based on the perspective of Malaysian public listed companies.

The objective of this study is to analyze factors that significantly affect Muslim preference on cash waqf and to assess its mediation effects to cash waqf contributions. Using primary data on three hundred respondents in Indonesia, the study adopted structural equation modelling as tools of analysis. The research confirms that religiosity, knowledge on cash waqf, convenience, benevolence of cash waqf institutions, and promotion as major factors to significantly affect cash waqf preference. Hence cash waqf preference mediate the relationship between those exogenous variables with nominal of cash waqf, the repetitions and the intensity of cash waqf.

To improve the incomes of a population and attain sustainable development, a nation’s primary goal must focus on continuous and inclusive economic development. Such optimal conditions will create economic security with greater and better employment opportunities for her citizens. This study seeks to look at the halal cosmetics sector, which is fast expanding globally, with special focus on the situation in Malaysia. Subsequently, it is crucial to diagnose the factors affecting the growth of halal cosmetics SMEs operating in the halal cosmetics ecosystem. A cybernetics and systems-based approach will be developed to understand the dynamic nature of growth variables and their relationships will be mapped based on data gathered from various groups of stakeholders in Malaysia. The research method chosen is qualitative due to the multi-faceted nature of the halal cosmetics industry. The cybernetics analysis had identified the most binding constraint variable within the halal cosmetics industry. This will enable policy makers and SMEs to take intervention initiatives and thereby ensure the growth of halal cosmetics industry and increase inclusive growth in this industry. It has also paved the way for the stakeholders to predict behavioural changes of the affected variables should any of the related growth constraint variable alter. Advent of COVID19 pandemic has impacted the cosmetics industry as a whole and use of augmented reality coupled with the rise of skin care gadgets has ensured survival of this industry.

Pasca berlakunya tsunami pada tahun 2004, melalui MoU Helsinki yang dimeteraikan antara pemerintah Republik Indonesia dan Aceh, Negeri Aceh diberikan satu kuasa “Autonomi Daerah” dalam menjalankan pentadbiran negeri. Tujuan dan permasalahan yang dibincangkan dalam artikel ini adalah melihat bagaimana peluang autonomi daerah yang telah diberikan oleh kerajaan Indonesia kepada negeri Aceh dapat digunakan sepenuhnya untuk melaksanakan sistem perbankan Islam. Kajian ini digarap berasaskan metode kualitatif melalui pendekatan deskriptif semula. Hasil dari kajian ini adalah Aceh yang terkenal dengan negeri serambi mekkah ini mengalami keterlambatan dalam pelaksanaan sistem perbankan Islam walaupun sebenarnya pada tarikh 16 Julai 2008 telah disahkan Undang-undang Nomor 21 Tahun 2008 tentang Perbankan Syariah sebagai landasan hukum tersendiri bagi bank syariah di Indonesia namun Qanun Aceh yang mengatur tentang sistem kewangan Islam baru muncul pada tahun 2018. Kesimpulannya, dengan peluang antonomi daerah yang diberikan oleh pemerintah pusat Indonesia kepada negeri Aceh, Aceh perlu mengambil langkah-langkah yang konstruktif bagi memastikan pelaksanaan syariah di negeri tersebut dapat dilaksanakan secara kaffah termasuk dalam bidang sistem perbankan Islam.

This study evaluated the effect of non-interest banking products on the financial performance of Jaiz bank Plc (the only full-fledged non-interest bank in Nigeria), using time series data generated from the annual reports and accounts of the bank, covering the period 2013- 2019. Descriptive statistics such as mean, median, minimum and maximum values are used in data presentation, while ordinary least squares regression is applied in the investigation of the effect of non-interest banking products (investment in Sukuk, investment in Istisna and investment in Ijara assets) on the financial performance surrogated by return on equity. Results reveal that investments in Sukuk and Ijara assets have significant positive effect on the financial performance; while investment in Istisna has significant negative effect on the financial performance. The study concludes that in the long run, investments in Sukuk and Ijara assets will enhance shareholders’ value, while investment in Istisna will attenuates shareholders’ earnings. The paper recommends that Jaiz bank Plc should consider more carefully the utility and value maximization of investment in Istisna in comparison to investments in Sukuk and Ijara assets.

This study resolves the gap between Profit and Loss Sharing (PLS) theory and the practice of Islamic banks in financing customers. Two-step GMM estimation technique is used in the investigation. The empirical finding of the study is consistent with the PLS theory of reducing credit risk and inconsistent with the practice of Islamic banks. Equity-based financing has been found to reduce credit risk, while bank-specific determinants such as credit growth, profitability, and cost inefficiency influence the credit risk. Furthermore, institutional development is a macroeconomic indicator that reduces credit risk. This study offers policy implications for risk-minimised decisions in financing clients.

The study focuses on establishing the downside beta for Shariah compliant index, conventional index and bitcoin index (a cryptocurrency) in Malaysia. The indices for the Shariah compliant is the FTSE Bursa Malaysia EMAS Shariah (FTFBMS), the conventional index used is the FTSE Bursa Malaysia EMAS (FTFBMEMAS) and the proxy index for the cryptocurrency is the bitcoin. Given the weak track record of cryptocurrencies in Malaysia, the bitcoin is used as a proxy to simulate cryptocurrency behavior in Malaysia. Downside beta for the three portfolios is calculated through the use of historical volatility (HV) and the Exponentially Weighted Moving Average (EWMA) methods. The findings indicate there is a statistically significant difference in downside beta for each of the portfolios, although the difference is very minimal between Shariah compliant index and the conventional index. However, bitcoin poses to be a riskier portfolio with significant difference over both other indices. The low beta for Shariah complaint indices and its conventional counterparts suggests the large market volume the two indices share, still maintaining them as the mainstream financial models. While bitcoin is vastly riskier, it is surely making promising strides as far as financial trading methods are concerned. Moreover, there is great optimism in cryptocurrency models that assimilate moral Islamic trading principles as research has shown Shariah compliant stocks to be more efficient.

Industrial Revolution 4.0 has been the new hype for several years now. Everyone is talking about automation and the changes to the job environment, which will cause massive technological unemployment if IR4.0 adaptation were not taken seriously. The journey of industrialization was then accelerated when the Covid19 pandemic hits the global. Everybody is all about the new norm that promotes social distancing, automation, and the virtual world. Though it is the right measure, IR4.0 was not viewed in Islamic perspectives. The existence of automation that may disregard Islamic moral or ethical value and fintech that is not compatible with Islamic finance and has attracted users to switch from Islamic finance to conventional financing is concerning. All of these happened due to the failure to foresee that the demand to adapt IR4.0 is not only a mere worldly success but can also be considered as Al Falah, an Islamic concept that defines success as something beyond materialistic. Therefore, the purpose of this paper is to eidolon efforts to adapt to IR4.0 as an effort to achieve Al Falah. This will give insight to Muslim scholars to take part in the development of IR4.0 in Malaysia since the concept of Al Falah will offer them greater motivation and purpose other than worldly matters. The paper is constructed to examine the discussion of Al Falah in publication, which manifested through Akhlaq, Ibadah, and Akidah and projected it in every benefit and challenge brought by IR4.0, which are productivity and efficiency, technological unemployment, and skills gap. The discussion showed that as the concept of Al Falah embedded in every aspect highlighted, the benefits of IR4.0 might bloom many other advantages as Al Falah not only aim for material gain but also promotes good morality, persistence, and determination, which will boost success. It also shows that the drawback of IR4.0 may be minimized since the community's welfare is put forward than personal goals. Understanding the concept will motivate Muslims to work harder, set the right goals, and offer more than expected. All of these traits will help the adaptation and adoption of IR4.0 technologies.

This paper aims to investigate whether the large shareholder's ownership influences the firm's financial performance during the year 2018 in the non-financial firms listed in the MENA countries. In this paper large shareholders measured as a percentage of shares held by the top largest shareholder, financial performance was measured using ROA, ROE as an accounting performance measure, and MTBR as a market performance measure. Firm age, firm size, and leverage were used as control variables. This study using all non-financial listed firms in nine MENA countries with 361 total observations. The finding shows a positive significant relationship between large shareholders' ownership and firm financial performance (ROA, ROE, and MTBR). But control variables are a negative significant relationship with large shareholders.

In accordance with the history of Islam, waqf zurri has been used as a property planning instrument or succession planning for the family. Waqf zurri aims to defend the plight of families left by their parents who are helpless. In the concept of Islamic law, a person who own property and intended to make waqf on his property should put priority on their immediate family members. Arguing the stewardship concept in accounting; it is known that the ultimate objective of accounting theory is to provide a basis for the prediction and explanation of accounting behaviour and events. Stewardship also demanded reporting and responsibility to be in place. Hence, the discussion in this article focuses on the positive accounting theory and decision usefulness theory which can be linked towards waqf zurri conduct on reporting manners. Those theories are beneficial since no standard reporting for waqf zurri adopted as for now. Therefore, the objective of this paper is to examine the accounting theories and stewardship concept in relation to waqf zurri reporting. Nonetheless, the needs for those theories in creating appropriate accounting principles in waqf zurri is open for debatable. This paper is a conceptual paper whereby the related literatures have been referred and analyse using thematic analysis. The implication of this paper is that the reporting of waqf zurri is deem important and shall be prepare meticulously dependable on the crucial accounting theories by the accountable party.

This paper aim to investigate the effect of large shareholder’s ownership namely, family, government, foreign and institutional ownership on the firm financial performance among all Jordanian non-financial firms listed on Amman Stock Exchange for the year 2018 with 70 observations. In this paper, financial performance was measured using ROA, ROE as accounting performance measure, and MTBR as market performance measure. Firm age, firm size and leverage was used as control variable. the finding of this study show a positive significant relationship between family, foreign and institutional ownership and firms financial performance. Also, show negative significant relationship between government shareholders ownership and firms financial performance ROA, ROE.