ISLAMIC ETHICS

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 Table of contents

01 02 03 04
Introduction Ethics & Code of ethics for Incorporating ethics
Accounting Accountants into education
Financial Fraud as a
result of unethical Adab befor
behavior knowledge
AAOIFI Standard Curriculum

05
Ethics & Maslahah
 Introduction
Overseas Indonesia
• Enron – energy (2001), Lehman
Brother – investment bank (2008),
World.com – telcom (2002),
OLYMPUS-Electronics (2011)
• Kimia Farma (2011), Garuda
(2019), Jiwasraya (2020)
• Accounting profession should hold
ethics
• Blended learning
• Mashalah mindset VS self interest

Association of Certified Fraud Examiner

 ETHICS ….

Character Spirit Attitude

Moral Values Akhlaq

 Accounting

Value Free? Value laden

Neutral, technical things Accounting practices

(analyse – reporting) should be united with
without moral involvement ethics
 Ethics is an output of “good” education
process

• The important of Adab before knowledge

• Imam Malil r.a
‫تعلم األدب قبل أن تتعلم العلم‬

“Learn Adab before Knowledge”

• Syaikh Ibnu Mubarak, seorang ulama yang sangat shalih, berkata, "Thalabtul adab
tsalatsuna sanah wa thalabtul 'ilm 'isyrina sanah" (Aku belajar adab 30 tahun lamanya,
sedang aku belajar ilmu hanya 20 tahun lamanya).
Code Of Ethics
(AAOIFI)
Sharia Rules & Principles

Regilious Belief,
Obeying Allah,
Refraining form Haram

Existing Professional
COdes

Do not contravene to
shariah
 Structure of AAOIFI’s Code of Ethical Conduct

Shariah Foundation Principles of ethics

7 aspects : Integrity, 6 principles: Trustworthy, ligitimacy,

Vicegerency, Sincerity, Piety, objectivity, professional competence
Righteousness, Allah-Fearing, & diligence, faith-driven conduct,
Accountability before Allah professional conduct & technical
standard

Rules of ethical conduct

Guiding rules
 7 Shariah FOudations
01 02 03 04
INtegrity Vicegerence Sincerety Piety
Competent & Qualified Allah is the supreme Obey Allah, every Fear Allah privetely &
Al-Qosos : 26 authority, human is publicly (Al-Mulk: 12)
activity is a part of
َ ْ‫ِإنَّ َخي َْر َم ِن اسْ َتْأ َجر‬
khalefa (2:30) ِ ‫ َن َر َّب ُه ْم ِب ْال َغ ْي‬E‫ِين َي ْخ َش ْو‬
‫ب َل ُه ْم‬ َ ‫ِإنَّ الَّذ‬
ُ‫ت ْال َق ِويُّ اَأْلمِين‬ ibadah
‫ض َخلِ ْي َف ًة‬ِ ْ‫ۗ ا ِّنيْ َجاعِ ٌل فِى ااْل َر‬ ‫َم ْغف َِرةٌ َوَأجْ ٌر َك ِبي ٌر‬

05 06
Allah-Fearing
05
Accountability
Righteousness
Best effort in performing Best effort in performing Al-Isra: 36
works
works ً‫ان َع ْن ُه َمسْ ُؤ وال‬ َ ‫ص َر َو ْالفَُؤ ادَ ُك ُّل ُأولَِئ‬
َ ‫ك َك‬ َ ‫ ْال َب‬E‫ِإنَّ السَّمْ َع َو‬
6 Principles
 Trustworthy
Truthful, Honest, Keep Refrain
Confidential
In presenting & From using confidential
communicating relevant infpormation & unethical
financial& non financial advantage
information

Refrain Refrain
From disclosing confidential From any actions or
information behaviors that may harm
religious & ethical
objectives
 LEGITIMACY
Accountability to Allah Responsible for

Over accountability to Verifying the religious

others legitimacy of events in
accounting or auditing

Aware of shariah rules & Ensure shariah compliance

Principles

Especially about financial Of all business activities &

transactions through transactions
FORMAL TRAININGS
 OBJECTIVE
Refuse any gifts
Independence
Riswah

Avoid owning significant

number of share in client’s
Avoid conclict of interest firm
apparently
Personal or family
relationship
Refrain from

Engaging other
Avoid contingent fees
professional activities
while auditing the client
Fees contingent on the
results of auditing
 Professional
High Quality of
Ensure Quality Control of
Works based on shariah, and relevant
rules
the subordinates and
assistants in the
Appropriate level of academic &
performance of professional
professional competency
duties

Sufficient knowledge of
Ensure report are
shariah, update with
profession & standards Complete, clear and supported
by appropriate analyses of
Refrain from agreeing relevant and reliable
information
To perform professional
duties unless sufficiently
competent to perform

Constantly conscious of
Allah’s surveillance (self-
monitoring)
Faith driven
Constantly conscious of
Be sincere in performing
accountability before Allah on the
02 professional duties, seeking Allah’s
day of judgement (self
accountability)
03 satisfaction and not submitting to
human pressures

Fulfill promises and

04 honour agreements. Co-operate with others to ensure smooth 06
05 and efficient performance of professional
duties.
Show love and brotherhood for the sake of
Allah to enhance co-operation and trust
when dealing with others

07Be kind in dealing and in handling problems

with others

08 Set good example for assistants and

subordinates
 Professional conduct
and technical standards

Comply with relevant accounting Refrain from engaging in activities and

and auditing standards. 02 Perform professional duties
diligently 03 conducts that may jeopardise integrity,
objectivity and independence

In the case of replacing another professional accountant, the new accountant should ascertain the reasons of
04 replacement and refrain from accepting the new appointment unless the reasons for change are acceptable,
and are not due to refusal to submit to pressures especially in violating Shari’ah rules and principles
 Ethics-
Education
United
Curriculum
 Islamic worldview

Tawhed, Khalefa, Falah

Sufficient
Knowledge, ability
& motivation
Ethical awarenesss to make company disclosure in
the public interest

Maslahah
 Maslahah
the realization of benefit to the people, relating to their
affairs both in this world and in the hereafter
“O mankind, a direction has come to you from
God; it is a healing for the ailments in your hearts
and it is a guidance and mercy to believers” (al-
Qur’an, 10:75)
 Maqasid shariah (Abu Zahrah)

Tahdzib Al Fard Iqomah al ‘adl

educate the individual establish justice

Jalb Al Maslahah
realize benefit
(maslahah) to the
people
 Thanks!
Do you have any questions?

ela@tazkia.ac.id

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