Islamic Finance Standard-Setting Bodies AAOIFI and IFSB Join Forces to Strengthen the Development and Resilience of the Islamic Financial Services Industry

Manama, Kingdom of Bahrain – The Accounting and Auditing Organization for Islamic Financial Institutions (AAOIFI) represented by His Excellency Sheikh Ebrahim bin Khalifa Al Khalifa, Chairman of the Board of Trustees, and Islamic Financial Services Board (IFSB) represented by Dr. Bello Lawal Danbatta, Secretary-General, have signed a Memorandum of Understanding (MoU) to facilitate international cooperation between the two organisations to jointly undertake technical activities relating to development and revision of prudential, Sharīʿah, accounting and governance standards as well as for raising awareness on emerging issues in the Islamic financial services industry.

 

With the aim of providing guidance to members of both organizations as well as to coordinate efforts for strengthening the development of the Islamic financial services industry, areas of cooperation under the MoU between AAOIFI and IFSB include:

 

  • Development and revision of prudential, Sharīʿah, accounting and governance standards on areas of mutual interest

Collaboration includes jointly developing and revising prudential, Sharīʿah, accounting and governance standards on areas of mutual interest, as well as supporting activities of either organization through circulation of research materials and exposure drafts to the combined membership.

 

  • Promote the implementation of prudential, Sharīʿah, accounting and governance standards to facilitate the development of the Islamic financial services industry

Collaboration includes organising of joint workshops, providing expertise for joint technical assistance missions as well as coordinated policy dialogues to regulatory and supervisory authorities in the member jurisdictions.

 

  • Enhance awareness through knowledge sharing and organisation of executive programmes, workshops, conferences, seminars etc.

Collaboration includes exchange of information and knowledge-sharing activities to benefit from each organisation’s experiences and expertise. These also include promotion and dissemination of any work related to standards or research as well as enhance outreach to respective member jurisdictions for creating awareness through jointly organising and hosting of international conferences, seminars and forums on areas of mutual interest

At the occasion, His Excellency Sheikh Ebrahim bin Khalifa Al Khalifa said, “the collaboration between the two major standard setting bodies of the Islamic financial services industry (by way of signing this MoU) is a landmark step which was a need of time and a greater need for times to come. The industry must have its footings on strong and sustainable principles and both the institutions need to strive for that together.”

Dr. Bello Lawal Danbatta added, “this MoU between the IFSB and AAOIFI paves way for strengthening coordination and combining efforts for the sustained growth, development and resilience of the Islamic financial services industry. The IFSB and AAOIFI have each been actively promoting the soundness and stability of the Islamic financial services industry through various activities in line with their respective mandates. The MoU going forward provides an excellent opportunity for both standard-setting bodies to consolidate their efforts and provide the Islamic finance stakeholders with more harmonised guidelines and standards”.