A Conceptual Framework for Islamic Financial Reporting: Key Components

Reza Gholami-Jamkarani, Ibrahim Abed Mousa Alsabary () and Anmar Noori Dawood
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Reza Gholami-Jamkarani: Islamic Azad University
Ibrahim Abed Mousa Alsabary: Al-Mustaqbal University
Anmar Noori Dawood: Al-Mustaqbal University

A chapter in New Challenges of the Global Economy for Business Management, 2025, pp 1031-1046 from Springer

Abstract: Abstract This study aims to discover and develop the components of the conceptual framework of Islamic financial reporting (CFIFR) and provide a framework for developing applicable accounting standards under the Shari’ah. Accounting is social knowledge inherently related to the environment, values, and socio-economic and cultural norms of society. Accordingly, logic dictates the requirements, conditions, and qualities of the environment of the target society to be considered in using theoretical concepts and financial reporting. The present study, by examining the literature on CFIFR and using the deduction and the Delphi method, explains the critical components of this reference framework. In Islamic financial reporting (IFR), accounting has worldly and other-worldly dimensions and is based on Islamic accountability. In the other-worldly dimension, this accountability includes self-accountability and social accountability in the worldly dimension. The results of this study show that the academic and professional experts in financial reporting in Iran agree that accountability takes precedence over decision-usefulness in the IFR. So, the critical components of CFIFR are expanding the scope of users to stakeholders, providing fair and faithful representation of statements, using the current value-based measurement system, and disclosing “how to earn wealth” and “how to distribute earnings.” Given the broad discussions on the recognition section in financial reporting, such as steps of recognition, recognition criteria, recognition process, etc., the present study has yet to deal with this part of the conceptual framework of conventional financial reporting. Also, the main components have been examined in other sections, and the detailed evaluation requires further studies. This developmental study uses the previous investigations and their conclusions to provide a framework for the theoretical concepts of the IFR.

Keywords: CFIFR; Accountability; Islamic accounting; Financial reporting; IFRS (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:spr:prbchp:978-981-96-4116-1_65

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DOI: 10.1007/978-981-96-4116-1_65

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