Quranic Guidance in the Development of External Shariah Audit for Islamic Financial Institutions in Malaysia

This article explores the guidance of the Quran in terms of formulating external Shariah audit (ESA) frameworks for Islamic Financial Institutions (IFIs) in Malaysia. It develops a conceptual framework that links Quranic values to the institutional design features of ESA such as independence, accountability, transparency, scope and corrective powers while arguing that their incorporation will enhance IFIs’ Shariah compliance, public trust and their effectiveness in achieving the goals of Shariah (Maqasid Shariah). The study draws on the Shariah Governance Policy Document (SGPD) by Bank Negara Malaysia (BNM) on Shariah audit practices, literature review in ESA, and relevant Quranic texts and their explanation (tafsir). It identifies some policy implications and provides an operational checklist for Malaysian regulators, Shariah committees and external auditors.