By Asmahanim Amir
Pix Izwan Azman

PUTRAJAYA, Feb 11, 2016 – The National University of Malaysia (UKM), International Islamic University Malaysia (IIUM) and Universiti Utara Malaysia (UUM) are working together to develop a uniformed accounting system for the country’s Islamic institutions.

Finance Minister II, Dato’ Seri Ahmad Husni Mohamad Hanadzlah said the study is needed  to resolve issues faced by state religious councils in standardizing the annual financial reports, especially those involving transactions of endowment or Wakaf.

“The newly developed accounting system will be utilised be institutions in all states except in the Federal Territories,” he said after witnessing the signing of a memorandum of agreement (MoA) between the Accountant General’s Department Malaysia, UKM, IIUM and UUM on Feb 4.

He said that the research on a new standardized system is expected to be completed by the end of this year before being implemented by the state institutions.

Dato’ Seri Ahmad Husni explained that the research will identify the disparity between current accounting practices and financial reporting for endowments, tithes or Zakat and revenue in accordance with Islamic accounting requirements.

“Besides that, the study will also identify the Syariah requirements and the limits of civil law in implementing the standards and to develop the conceptual framework of Islamic financial report by the institutions,” he said.

He said the research will not only to be used for the three institutions, but also to strengthen the nation’s leadership in the world of Islamic finance.

“Even more so that the OIC (Organisation of Islamic Cooperation) looks to Malaysia for support in developing the economic growth of Islamic nations,” he said.

He stated the selection of the three universities for the task was based on knowledge, expertise and track record in carrying out research related to accounting and Islamic finance.

The initiative also received the cooperation of the State Islamic Religious Council, National Audit Department, Department of Islamic Development Malaysia and Department of Endowment, Tithe and Haj.