Islamic Finance in Theory and Practice

Perspectives of the early scholars of Islamic management of an account concurred that the arrangement of organization partnership in general and Murabah （benefit sharing） specifically is the fundamental technique on which Islamic banks must depend on contributing their money to related assets. Also, the research has found that financing under the Islamic management of an account has decreased intensely from the methodology created by the early scholars. In reality, these banks have received obligation based on financing techniques and underestimated the routines for financing taking into account benefit and loss sharing. This adjustment in financing technique has perversely influenced the bad name and the desire tied with the monetary part of these banks. The study focused on the reason behind the gap between theory and practice in Islamic finance. So, the study was divided in two parts： the first theoretical part of Islamic economy and Islamic banking system, the second practical part by analysing and evaluating the relative distribution of Islamic financing methods in four famous Islamic banks. The study selected a group of Asian Islamic banks as a model for analysis and evaluation through the period from 2012 to 2014. The study concluded that the gaps result from the misuse of the roles and norms of Maqasid Al-Shariah along with the diversion in the relatively allocation of the financing methods toward debt instruments rather than equity instnunents.

Theory of Risk in Conventional Public Finance and Islamic Finance

The research objective of the article is to extend the theoretical basis of risk management in the public and Islamic finance. The author hypothesizes that the existing theories of finance, the public choice theory, and the concept of New Public Management create insufficient conditions for risk management in the public finance sector entities and associated international structures of public-private partnership. As shown by the experience of recent years, the theory of financial markets as regards its operators has not yet developed a widely accepted model of risk management. In addition, the public choice theory and the concept of New Public Management do not fully illustrate the essence of risk management in the public sector, especially in capital structures where a private entity （Islamic investor） partners a public one. In Islamic finance, Sharia complaint instruments cannot be based on gharar, which is usually translated as risk, deception, delusion, and excessive uncertainty. The research methods mostly used in the article are analysis and critique of scientific literature with respect to risk of operation of public entities and risk in Islamic finance as well as public-private partnerships. The basic conclusion is that the adopted interpretations of risk in selected theories of conventional finance and the foundations of Islamic economy indicate that joint projects related to infrastructure are feasible.

Qatar as an Emerging Islamic Finance Hub

The principal objectives of this research are to provide information, commentary, and analysis of the potential opportunities for Qatar in developing its Islamic financial services and industry. This research examines how competitive Qatar is today and its future prospects in Islamic finance. This research provides policy makers and Islamic finance stakeholders with a superior understanding of the role of the key competitive factors in Islamic fmance. It is anticipated that this research will influence the growth and diversification of Islamic financial services in Qatar.

The Emergence of Islamic Economics and Finance Education in Indonesia

Islamic banks and finance have appeared over the last two decades in Indonesia and been viewed as having significant growth in terms of numbers of new Islamic banks established in Indonesia. This enlargement is in line with high growth in Islamic economics and finance education. There exist various institutes and universities offering courses related to Islamic economics and finance including Islamic banks. This paper explains the growth and development of Islamic banking and financial industries from 1992 to the 21 st century in Indonesia in terms of education, trends, and challenges. However, the rapid development in the global financial markets poses various challenges to Islamic banking particularly in education of Islamic economics and finance in the present era. These issues and challenges need to be addressed very carefully in order to offer ideal human resources in Islamic banks and financial industries and sustain the rapid growth it experienced before. This paper highlights various developments, issues, and challenges confronting the Islamic banking and finance education system to offer recommendation for further improvement.

Islamic Financing of the Small Projects Palestinian Case

This study aims to expose the available finance by both traditional and Islamic banks in Palestine, determine and identify the most used Islamic tools of finance for the Palestinian economy through small enterprises, in addition, the study aims to assess if there is any contribution of the Islamic banks to the Palestinian economy. In order to reach these goals the researcher used the descriptive analysis method in order to illustrate credit facilities through the Palestinian Banking system, then, enclosing the Islamic banks in Palestine and its credit facilities and used tools. The study identified through the recent experiences of Palestinian Islamic financing and Islamic financing mechanisms practiced in Palestinian Islamic banks, murabaha, ijarah, Musharaka, and mudaraba occupied the same important level as in the neighboring countries. The study found that frequent constraints, Israeli hindrances, and heavy restrictions on goods movement, services and people through internal and international crossings increase the suffering of the small projects, as well as other productive economic sectors at all levels, administrative, financial, and technical, with no Palestinian strategy to enhance the contributing share of small projects to the Palestinian national economy. In addition, the study concluded that the inability of traditional banks to provide the required finance to the Palestinian productive sectors led to Islamic banks entering into the financing market in Palestine to open new funding sources for Palestinian small projects, so the small projects could raise their contribution to GDP. The new Palestinian Islamic financing experience is unable to create financing mechanisms suitable to the Palestinian situation, which has sign for Islamic banks to deal with cases similar to the traditional finance, this comes in the absence of a strategy by Islamic banking or monetary authority or the Palestinian government to activate the role of Islamic banks in financing small projects. For these problems, there must be a strategy to support the activities of these projects and provide appropriate funding for small projects to transcend all these constraints, to support small-sized enterprises in Palestine financially and technically. In this study, the researchers expose the available funding and financing by both Islamic and traditional banks. The study recommends that a comprehensive strategy needs to bring together all financing bodies to have joined efforts towards the formulation of a funding strategy for small projects. Both conventional and Islamic banks are required to provide various types of supports specifically financing for small projects, to enable small projects to play their role in enhancing the national economy. The study also urged the need of Islamic banking to broaden the base of Islamic banking to create a financing base appropriate with the nature of the projects.

Factors Influencing Information Disclosure by Malaysian State Islamic Religious Councils: Evidence from Interviews

This paper aims to identify factors that influence the expectations of a wide range of stakeholders on the information disclosure in the Malaysian State Islamic Religious Councils(SIRC)annual reports,employing semi-structured interviews.The majority of interviewees perceived accounting standards as the main factor contributing to their expectations and further influenced the reporting practices among accountants in SIRC.Others are state fatwa(Islamic rulings),audit expectations,and individual perceptions.The result of the interviews revealed that on the top of accounting standards and government guidelines on the reporting for all government agencies,SIRC should take into account their greater accountability,which should be reflected in their reporting practices.Therefore,Islamic accountability through fatwa,audit expectations,and public demands could be considered.Such awareness is important in SIRC,to differentiate them from other government agencies.The existence of governance is similar to the board of members in a company,in SIRC through the fatwa committee.Therefore,this study suggests that the extent and quality of disclosure depends on the demand from the regulators,auditors,and funders.The findings suggest that SIRC should have an incentive to provide more information to satisfy various stakeholders’needs.Future studies can be carried out to suggest a set of disclosure items that should be disclosed in the SIRC annual reports in order to increase the level of disclosure,discharging their accountability.

The Reconcilability Between Islamic and the Conventional Banking

Tensions between Western and Islamic traditions are very fierce in evidence currently. Many see the two systems as irreconcilable and the conflict between the two as inevitable （Huntingdon ＆ Berger, 2002）. This paper argues if reconcilability between Islam and the West exists in the field of finance and if the two systems can co-evolve in a mutually productive way, then, the author can be optimistic about the ability of the two systems to co-exist. Clearly, they involve different attitudes, but this paper argues on the basis of significant compatibility issues that these are resolvable under the tradition of tolerance that has existed in Western and Islamic societies. The context chosen for this analysis is finance which is central to global capitalism and is an area in which key differences of principle and practice exist between Islam and the West.

Islamic Globalization and Its Role in China’s Future

Islamic Globalization is a combination of religious,economic,political,and diplomatic advances that are transforming the Muslim world.Its building blocks are the hajj and religious travel,capitalism and Islamic finance,democracy and Islamic Modernism,as well as new international regimes tailored to the varied needs and tastes of Muslims in diverse cultures.Islamic Globalization allows modern Muslims to join the mainstream of international life and to reform it at the same time.These are also China’s goals,particularly as Chinese leaders express greater interest in soft power;eager to identify with visions of civilizational exchange and global governance.

Islamic Financial Development and Cooperation Among Member States in CICA

There are 26 member states in the Conference on Interaction and Confidence-Building Measures in Asia(CICA),including Asian countries and some African countries.CICA has developed the regional and cooperation mechanism with the largest coverage,the largest number of members and the widest representation.The vast majority of member states are countries along the Belt and Road Initiative(B&R),and many countries use Islamic finance in CICA’s own financial system or are interested in cooperating with Islamic finance.For political and economic reasons,Islamic Banks development in CICA member states is imbalanced.Sukuk(Islamic Bonds)development in CICA member states is mainly sovereign Sukuk.The share of Islamic Funds assets in CICA member states is very low.The tak
aful sector in Iran is comparatively developed in CICA member states.Islamic Financial development and cooperation in CICA member states is mainly concentrated in Islamic countries.However,it has expanded to Non-Islamic Countries.In the future,Islamic finance development and cooperation will play an active role in the construction of the B&R.

Structural Framework of Islamic Aqidah on the Practice of Earning Management

There is growing concern among the users of financial statements about the level of frauds occurring in the business organization.The unexpected collapse of corporate giants such as Enron and WorldCom has driven those interested to pay more attention to the unethical practices in accounting systems.The phenomenon of Earnings Management(EM)is seen as one of the most problematic issues facing the accounting profession during the last few decades.It has been argued that EM misleads the users of financial statements.This is because when the managers alter earnings,the financial statements do not accurately reflect the economic wealth of the company,which ultimately leads to the gross violation of stakeholders'trust.The objective of this paper is firstly to address the ethical issue of EM and evaluate the progress of research in dealing with this issue where Islamic Structural Framework,based on Islamic creed(aqidah),can provide some insights into the behavioral pattern and actions that could be undertaken to reduce or eliminate the practice of EM.Hence,the paper proposes a structural framework of Islamic Aqidah and the practice of EM that functions as a guidance to direct the intentions as well as behaviors of managers towards a proper manner(derived from the Quran and Sunna).