Islamic Financing and Business Framework: A Survey

European Journal of Social Sciences, Vol. 15, No. 4, 2010

18 Pages Posted: 12 Nov 2009 Last revised: 23 Nov 2011

See all articles by Muhammad Hanif

Muhammad Hanif

National University of Computer and Emerging Sciences (NUCES or FAST-NU) - FAST School of Business

Abdullah Muhammad Iqbal

Independent

Date Written: November 10, 2009

Abstract

This study is conducted to evaluate suitability of existing business environment in Pakistan for application of sharia based financing. Opinion survey of finance professionals, Islamic Bankers, entrepreneurs and academicians is conducted through questionnaire. Findings suggest number of hurdles including dominance of conventional banking, earnings manipulation by firms, higher taxes, weaker auditing, lack of trust and confidence in the abilities of Musharaka partners, riskiness of Musharaka and inability of conventional financial reporting framework to ensure transparency, are in the way of popularity of Musharaka financing. Increased awareness, new products development, capacity building of IFIs, reforms in financial reporting framework and strengthening audit institution, might be helpful in implementation of Musharaka financing.

Keywords: Musharaka, sharia based, sharia compliant, earnings manipulation, financial reporting

JEL Classification: R11, G15, G21

Suggested Citation

Hanif, Muhammad and Iqbal, Abdullah Muhammad, Islamic Financing and Business Framework: A Survey (November 10, 2009). European Journal of Social Sciences, Vol. 15, No. 4, 2010, Available at SSRN: https://ssrn.com/abstract=1503190

Muhammad Hanif (Contact Author)

National University of Computer and Emerging Sciences (NUCES or FAST-NU) - FAST School of Business ( email )

A.K. Brohi Road
Sector H/11-4
Islamabad, 44000
Pakistan
+92 (051) 111 128 128 (Phone)

HOME PAGE: http://https://scholar.google.ae/citations?user=Q4gINjEAAAAJ&hl=en

Abdullah Muhammad Iqbal

Independent ( email )

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