The practice of reporting shariah non-compliant income in the Annual Financial Report of Islamic commercial banks in Malaysia = Pelaporan pendapatan tidak patuh Syariah dalam Laporan Kewangan Tahunan Bank Perdagangan Islam di Malaysia

Mat Nor, Nabilah and Sawari, Mohd Fuad (2020) The practice of reporting shariah non-compliant income in the Annual Financial Report of Islamic commercial banks in Malaysia = Pelaporan pendapatan tidak patuh Syariah dalam Laporan Kewangan Tahunan Bank Perdagangan Islam di Malaysia. Islamiyyat The International Journal of Islamic Studies, 42 (1). pp. 93-102. ISSN 0126-5636 E-ISSN 2600-8556

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Abstract

Bank Negara Malaysia (BNM) had introduced a policy document of Financial Reporting for Islamic Banking Institutions, which came into effect on 1st January 2018. This policy aimed to facilitate the assessment of Islamic financial institutions’ financial positions, performance, and Shariah compliance. However, the disclosure of Shariah committee report of a few Islamic banks may not have fulfilled the standard specified by BNM in terms of reporting the Shariah non-compliance incomes in their annual financial reports. This study therefore aims to investigate the extent of the application of BNM policy document for Islamic banks, with special focus on the practice of Islamic commercial banks in reporting Shariah non-compliant incomes in their annual financial reports. The qualitative method is adopted as the main research methodology of this study in order to gain information from the banks’ annual financial reports, as well as related research in the field. The findings show that nine out of sixteen Islamic commercial banks in Malaysia have fulfilled the standard provided by Bank Negara in reporting Shariah non-compliant incomes with complete detail in their annual financial reports. However, the remainder of the Islamic commercial banks did not properly disclose their Shariah non-compliant incomes in their report. ************************************************************************** Bank Negara Malaysia (BNM) telah memperkenalkan Polisi bagi Pelaporan Kewangan untuk Institusi Perbankan Islam yang berkuatkuasa pada 1 Januari 2018. Polisi ini bertujuan untuk memudahkan penilaian terhadap kedudukan kewangan, prestasi dan pematuhan Syariah bagi institusi kewangan Islam. Walau bagaimanapun, pelaporan daripada jawatankuasa Penasihat Syariah beberapa bank Islam mungkin tidak memenuhi piawaian yang ditetapkan oleh BNM dari segi melaporkan pendapatan tidak patuh Syariah dalam laporan kewangan tahunan mereka. Oleh itu kajian ini bertujuan untuk mengkaji sejauh mana bank-bank Islam mematuhi Polisi yang ditetapkan oleh BNM, khusus kepada pelaporan Bank Perdagangan Islam di Malaysia terhadap pendapatan tidak patuh Syariah dalam laporan kewangan tahunan mereka. Kaedah kualitatif digunakan sebagai metodologi penyelidikan utama kajian ini untuk mendapatkan maklumat daripada laporan kewangan tahunan bank, serta kajian yang berkaitan. Hasil kajian menunjukkan bahawa sembilan daripada enam belas bank Perdagangan Islam di Malaysia telah memenuhi piawaian yang disediakan oleh Bank Negara dalam melaporkan pendapatan tidak patuh Syariah dengan terperinci dan lengkap dalam laporan kewangan tahunan mereka. Walau bagaimanapun, bank Perdagangan Islam yang selebihnya tidak melaporkan pendapatan tidak patuh Syariah mereka dalam laporan tahunan. Penyelidikan ini akan menyumbang kepada para pengamal Bank Perdagangan Islam dari segi menyediakan maklumat yang telus mengenai urusan perniagaan dan kewangan.

Item Type:	Article (Journal)
Additional Information:	1469/82733
Uncontrolled Keywords:	Shariah non-compliance, SNC, annual financial report, BNM
Subjects:	H Social Sciences > HG Finance > HG1501 Banking H Social Sciences > HG Finance > HG3368 Islamic Banking and Finance
Kulliyyahs/Centres/Divisions/Institutes (Can select more than one option. Press CONTROL button):	Kulliyyah of Islamic Revealed Knowledge and Human Sciences Kulliyyah of Islamic Revealed Knowledge and Human Sciences > Department of Fiqh and Usul al-Fiqh
Depositing User:	Dr Mohd. Fuad Md. Sawari
Date Deposited:	21 Sep 2020 16:30
Last Modified:	24 Feb 2021 14:30
URI:	http://irep.iium.edu.my/id/eprint/82733

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