AAOIFI publishes External Shari’ah Audit Standard Exposure Draft and Invites opinion from Islamic Finance Industry

The Governance and Ethics Board (AGEB) of the Accounting and Auditing Organization for Islamic Financial Institutions (AAOIFI) has published the exposure draft of AAOIFI’s auditing standard on External Shari’ah Audit, and in this respect invites opinion and feedback from the Islamic finance industry.

The exposure draft aims towards introducing the external Shari’ah audit as a crucial governance organ for Islamic finance industry in line with the initiative already taken by certain regulators in this context. It provides comprehensive guidance to the professionals performing the external Shari’ah audits of Islamic Financial Institutions (IFIs), outlining the key professional requirements related to external Shari’ah audit, enhancing the quality and uniformity of practices, across the Islamic finance industry, throughout the world and strengthening public confidence in the global IFIs auditing process.

The standard was developed in collaboration with the Insititute of Chartered Accountants of Pakistan (ICAP). Considering the fact that Pakistan, is amongst the countries who have taken the initiative of external Shari’ah audit, it was felt beneficial for both AAOIFI and ICAP to work on this very important project jointly which will benefit the general Islamic finance industry. ICAP’s team provided technical support through the project and their efforts and time devotion were highly appreciated by AGEB. It is further expected that additional guidelines will be developed under the joint project to support the practitioners in developing their external Shari’ah audit practices.

With this regard, AAOIFI plans to hold public hearings on the draft standard in different parts of the world. Comments on the exposure draft are welcome and should be directed no later than 15 August 2017 to this email: [email protected]. All the notings and suggestions of the public hearings will be presented to AGEB in an upcoming meeting to decide about it and amend accordingly.

The exposure draft can be accessed by clicking on the following link