INCEIF Knowledge Repository (INCEIF University)
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Application of Shari'ah contracts in contemporary Islamic finance: a maqasid perspective
No full textThis research exposes the underlying maqasid embedded in Shari'ah contracts as applied in Islamic banking and finance. It addresses the problem of not observing maqasid in nominated and combined Shari'ah contracts as well as the problem of not sufficiently imbuing maqasid in products developed by Islamic financial institutions. As a benchmark of the maqasid of wealth, the research adopts Ibn 'Ashur's classification of maqasid to evaluate the conformity of Shari'ah contracts to Maqasid al-Shari'ah namely, justice, circulation, transparency, and firmness. The study focuses on three markets related to the application of Shari'ah contracts, namely, banking, Islamic capital market, and takaful. The study concludes that, by and large, the application of Shari'ah contracts has observed Maqasid al-Shari'ah during its development and initial application stages of Islamic finance products; however, offering such products in the market has raised economic questions as to their viability and economic values. In addition, the malpractice of some Shari'ah contracts has long raised concerns as to the maqasid compliance of such products. The research recommends a de-sophistication of Islamic financial engineering to minimise the possibility of convergence with conventional finance. The research also emphasises product differentiation based on less complicated combined Shari'ah contracts
The six steps of the Shari'ah financial planning
No full textShariah financial planning is the process of meeting a person’s financial and non-financial goals through a comprehensive plan and management of his property and finance based on Shariah rules and guidelines. In Shariah, a person’s wealth is not his own but held in trust for Allah. How one uses the property endowed to him determines his life in the hereafter. In financial planning, the financial goals are typically well understood; the non-financial goals are meant to fulfil one’s desire and obligation to comply with Shariah, nevertheless, they are achieved through finance, such as waqf and sadaqah (donation)
Shari'ah perspective on gold
No full textThe Quran confirms that gold as a currency is desired by all of mankind due to its inherent nature of purchasing power and store of value that enables mankind to gain ownership. Al-Razi in his commentary on Chapter Ali-Imran, verse 14 stated that, "the owner of gold and silver are the owner of everything." Recently, there has been an increasing demand for gold as it continues to display its positive stable qualities that qualifies it as a risk management tool, particularly during adverse financial markets scenarios. According to the latest Gold Demand Trends annual report from the World Gold Council (WGC), gold demand in Q4 2014 increased by 6% as compared to that in Q4 2013. In addition, with the issuance of the guiding principles of Basel III: Liquidity Coverage and Liquidity Risk Monitoring Tool, there is an attempt to explore gold as a Shariah-compliant high quality liquid asset (HQLA) for the Islamic banking system
Is our macroeconomic policy right? A simple test
No full textThe paper "Is our macroeconomic policy right? A simple test" presented at International Conference on Contemporary Issues in Accounting and Finance 2015 (CoCiAF 2015), Sarawak, Malaysia
Nomination issues in takaful tijari and takaful ijtima'i: an analysis of takaful companies, SOCSO, pension fund, EPF and pilgrimage fund from Shariah perspective
No full textThis research aims to look into nomination practice and its issue for takaful operators and social takaful (takaful Ijtima'i) from Shariah perspective. The major issue is to what extent the takaful benefit is the estate of participants. Various practices by takaful operators has established few perspectives on the matter. By adopting the qualitative research method specifically through content analysis, this research will begin with the review on fundamental concepts of insurance and takaful based on the opinions of scholars from various schools of jurisprudence ..
Is musharakah mutanaqisah a practical alternative to conventional home financing?
No full textIslamic finance had a healthy double-digit growth in the last decade and an important contribution to this steady success is the increasing demand for Shariah compliant products and services from both Muslims and non-Muslims around the globe. These products and services are perceived to be more resilient in adverse economic conditions, has risk-sharing attributes and provides competitive returns to conventional counterparts. Among others, the musharakah or partnership contract is commonly applied in many investment and financing initiatives. One variation of the musharakah is the musharakah mutanaqisah (or diminishing partnership) that emphasizes on the joint ownership of the asset purchased between the bank and the purchaser (customer)
On building social capital for Islamic finance
No full textThe purpose of this paper is to set forth seven broad recommendations and 15 specific initiatives within a four-dimensional framework for the development of social capital in Islamic finance, particularly the stock market, given its role as the first best means of risk sharing. The four-dimensional framework comprises dimensions of principle and value, trust-reinforcing regulation, investment opportunity and infrastructure, as well as reputational intermediaries. A web of multi-pronged initiatives that are mutually reinforcing is proposed considering the multifaceted dimensions of social capital and the various possible transmission channels by which social capital can influence the financial system. While empirical studies have demonstrated the importance of trust and ethics in financial development, the pressing issue remains how social capital, including trust and ethics, can be developed to achieve a trustworthy, ethical and efficient financial system. This paper attempts to address this concern
Interest rate and exchange rate risks of Islamic bank stock returns
No full textThis paper aims to empirically study the impact of interest rate and exchange rate risks on Islamic bank stock returns. The data for this study is obtained from the Datastream for the period between 1996 and 2013. The methodology employed is the standard linear regression and EGARCH estimation models. The dataset used in this study involves 39 full-fledged Islamic banks across the globe. The empirical evidence reveals that market risk is the major determinant of the sensitivity of Islamic bank stock returns. Both methods are used in this study indicates that the coefficients of market rate returns ..
Perceptions of auditor independence: the case of provision of non-audit services
No full textThe objective of this chapter is to examine the effects of the joint provision of audit and non-audit services on perceived auditor independence from the perspective of senior managers of audit firms, loan officers and public listed companies in Malaysia. The effect of join provision of audit and non-audit services might be different when auditor perform the services based on their available resources
The financial and operating performance of privatised companies: some further evidence based on Egyptian data
No full textThe term privatisation has many shades of meaning. The overall purpose of privatisation is that of transferring the provision of goods and services from the public sector to the private sector and Kay and Thompson (1986) suggest that the term covers denationalisation (the sale of state owned enterprises), deregulation (the introduction of competition) and contracting out (the provision by private sector organisations of public services). Over the past 25 years or so, all of these various forms of privatisation have developed and evolved and are now a pervasive feature of the economies of many countries. Available in physical copy only (Call Number: HF 5630 S464