Methodology Of Islamic Accounting

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Allah and His Messenger Mohammad gave us a rules related to all parts of our life to deal in Successful way and Accounting is also an integral part of our life. This Research provides the Methodology of Islamic Accounting, discussed the features, the objectives and the principles of Islamic accounting, the differences between Islamic and conventional accounting, the different Islamic accounting practices and the way it is presented in the balance sheet. The objective of the research is to increase the knowledge of the readers about the Islamic accounting and to know the extent of people’s attitude and knowledge towards Islamic and conventional banks, which have been done through a questioner. The researcher think that conventional banks is…show more content…
Accounting is an integral part of the economic life to measure, recognize, present the financial position in different financial statements and record the financial transactions. Accounting in Islam is based on a set of principles that guide the accountant in his job. These principles are came from the sources of Islamic law. Quran and Sunnah which are the primary sources, and consensus, analogical reason, juristic discretion, Public interest, Inference, Reason and Local custom which are secondary sources. (Shehata,…show more content…
Accounting has commenced with the establishment of the Dewans for the recording of Bait Al-Mal (public treasury) revenues and expenses and the calculation and the payment of Zakat. The objectives of accounting systems were to ensure accountability, simplify decision making and ensure fairness and justice. (ZAID, 2004) Islamic accounting term is used to provide a description about the distinctive body of accounting thoughts and practices. Islamic accounting is defined as “the process of identifying, measuring and communicating economic and other relevant information, inspired by the Islamic worldview and ethics, and complied with the Shari’ah (Islamic law) in order to permit informed judgments and decisions by potential and expected users of information to enhance social welfare and seek mardhatallah (the blessings of Allah)”. (Rahman, 2010) (Rahman, 2010) also states that the objectives and concepts of accounting as issued by Accounting and Auditing Organizations for Islamic Financial Institutions (AAOIFI) provide broad orientation for the development of Islamic accounting

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