Impact of Time Value of Money Theory in Ijarah Sukuk Genuineness; the Case of Bahrain and Malaysia

Sharif, Abdul Rahman and Abdullah, Adam (2018) Impact of Time Value of Money Theory in Ijarah Sukuk Genuineness; the Case of Bahrain and Malaysia. International Business Research, 11 (7). pp. 56-63. ISSN 1913-9004 E-ISSN 1913-9012

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Abstract

This research is a case study of two Ijarah Sukuk issuances in two countries. One issued by central bank of Bahrain and matured in 2014 and the other was issued by the Malaysian company TSH Resources Bhd and matured in 2017. By adopting library research and document analaysis, this research examines the terms and conditions of both cases based on what has been disclosed in the prospectuses. Accordingly, this study presents the impact of the Time Value of Money (TVM) in these cases and how it differentiates between genuine Ijarah Sukuk and a duplicate-bond Sukuk. The study revealed that there were some Shari’ah non-compliance issues in the implementation of Sukuk concept in both cases in a way it emulates conventional instruments featured as guaranteed-return instruments, which take into account TVM as an essential compenent in calculating its returns. However, such practice has a major effect on the genuineness of Sukuk, in terms of Shari’ah-compliance risk.

Item Type:	Article (Journal)
Additional Information:	7452/64274
Uncontrolled Keywords:	TVM, Sukuk Ijarah, bonds, Shari’ah, Riba’
Subjects:	H Social Sciences > HG Finance > HG3368 Islamic Banking and Finance
Kulliyyahs/Centres/Divisions/Institutes (Can select more than one option. Press CONTROL button):	Institute of Islamic Banking & Finance (IIiBF)
Depositing User:	Dr Adam Abdullah
Date Deposited:	27 Jun 2018 15:12
Last Modified:	10 Jul 2018 08:55
URI:	http://irep.iium.edu.my/id/eprint/64274

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