THE APPLICABILITY OF INTERNATIONAL FINANCIAL REPORTING STANDARDS (IFRS) IN ISLAMIC FINANCIAL TRANSACTIONS: AN ANALYSIS FROM THE SHARI’AH PERSPECTIVE

Islamic financial institutions (IFIs) must comply with the Shar  ah tenets. Shar  ah breaches thus need to be avoided, or if already having occurred in IFIs, need to be mitigated depending on the level of seriousness or materiality of the breach as indicated by the Shari’ah. Financial reporting from the Islamic perspective, according to the Malaysian Accounting Standards Board (MASB) (2007) in its paper to the Shari’ah Advisory Council of Bank Negara Malaysia, is the reporting of adequate information to enable users to make decisions that are Shari’ah compliant.