Oct 11 The Accounting and Auditing Organisation
for Islamic Financial Institutions (AAOIFI) plans to finalize
several new standards by the end of the year, as the
standard-setting body works through a revamp of its guidance for
the $2 trillion industry.
Bahrain-based AAOIFI has published a draft sharia standard
for gold-based products with a one month consultation period
ending Nov. 9, the industry body said in a statement. The
project was started last year by the World Gold Council, a
London-based market development body.
AAOIFI issues guidelines that are followed wholly or in part
by Islamic financial institutions globally, a sector that has
grown fast but remains fragmented across its core centers in the
Middle East and Southeast Asia.
AAOIFI's sharia board also discussed work on a new sharia
standard covering credit cards, while a final draft of a sharia
standard covering liability of investment managers would be
issued during its next meeting.
This could bring the number of published AAOIFI sharia
standards to 57 from the current 54. AAOIFI has also published
26 accounting standards, 5 auditing standards, 7 governance
standards and 2 codes of ethics.
A draft accounting standard on murabaha is also slated for
the end of 2016, a cost-plus-profit arrangement which is the
workhorse of Islamic banks' financing.
Preliminary studies on standards for sukuk (Islamic bonds)
and ijara (Islamic leasing) are also underway with a working
group expected to finalize the two by the end of the year,
A revision of AAOIFI's existing standard on sukuk, which is
14 years old, will cover issues including the asset-backed and
asset-based nature of sukuk, capital boosting instruments,
beneficial ownership and non-viability clauses.
(Reporting by Bernardo Vizcaino; Editing by Shri Navaratnam)