The Accounting Board (AAB) of the Accounting and Auditing Organization for Islamic Financial Institutions (AAOIFI) has officially issued financial accounting standard (FAS) 36 “First time adoption of AAOIFI Financial Accounting Standards”. This standard was finalized by the board after extensive discussions and due deliberations involving multiple industry consultations which included comments and remarks received from the industry at a series of public hearing
events as well as those received in writing from industry experts.
Mr Hamad Al Oqab, Chairman of AAB, stated that “this standard was added to the board’s agenda due to its practical significance and has been developed to address challenges that are faced by institutions adopting AAOIFI FASs for the first time. This FAS prescribe principles of financial reporting carried out for the first time, especially in jurisdictions that are adopting, or considering adopting, AAOIFI FASs”.
The standard accounts for these issues with regard to the transitional process, as well as, to financial reporting requirements applicable to the financial statements prepared for the first time in accordance with AAOIFI FASs.
This FAS supersedes the AAOIFI Accounting Guidance Note No. 1 “Guidance Note on First Time Adoption of AAOIFI Accounting Standards by an Islamic Financial Institution” and should be read together with AAOIFI Shari’ah Standard (SS) 6 “Conversion of a Conventional Bank to an Islamic Bank”.
The issued standard can be accessed BY CLICKING HERE.