The Accounting and Auditing Organization for Islamic Financial Institutions (AAOIFI) held the seventh meeting of its Governance and Ethics Board (AGEB) on 5th and 6th of March 2018 at AAOIFI head office in Bahrain.

The Board deliberated on the exposure draft of ‘Waqf Governance’. The objective of this standard is to provide principle-based guidance for the institutional and Shari’ah governance for Waqf and Waqf based institutions. The standard aims to provide core principles of governance as applicable to Waqf and prescribes the principle guidance on the institutional and Shari’ah governance. These include the specific considerations for the setup of Waqf, key responsibilities, and principles for establishing terms of reference of different organs of Waqf, including the proposed organs, guidance on the internal control, policies and procedures, guidance on the transparency and disclosures etc.

Sukuk Governance standard and Internal Shari’ah Audit preliminary studies were presented to the Board and members discussed the key areas of the projects and the general approach and directed the relevant working group to start documenting the exposure draft.

The Board reviewed its work achievements over the last year which included the finalization of the standards on “Central Shari’ah Board” and “External Shari’ah Audit”. In addition, the Board issued two exposures drafts namely, “Shari’ah Compliance Function” and “Shari’ah Compliance and Fiduciary Rating”. The Chairman of the Board Dr. Ishrat Husain expressed his satisfaction of the Board achievements and commented “as a major infrastructure institution of the Islamic financial industry, AAOIFI will continue to fulfil its mandate in providing world-class standards for the development of the global Islamic financial industry, and will continue to respond to the market needs and expand its standards’ coverages considering needs and interests of its stakeholder`”.

The Board also discussed the upcoming projects for 2018. With the finalization of the standard on External Shari’ah Audit the project on the External Shari’ah Audit guidelines will be initiated along with the preliminary study on shari’ah and fiduciary ratings for products. The Board will continue the project on the Comprehensive Ethics project which has a target deadline of completion by year-end 2018.

The next AGEB meeting is scheduled to be held in July 2018.