by Adel M. Sareaa, Abdullah M. Musliha, Iqbal T.H.b

aAhlia University, Kingdom of Bahrain; bKingdom University, Kingdom of Bahrain

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Abstract 

The objective of this paper is to explore the perception of accountants in Islamic Financial Institutions in Bahrain regarding the level of compliance with financial accounting standard (FAS 8) lease and lease to own (Ijarah and Ijarah Muntahia Bittamleek) standard. This standard aims at setting out accounting rules for recognizing, measuring, presenting and disclosing the transactions of Ijarah and Ijarah Muntahia Bittamleek that are carried out by Islamic banks and Islamic financial institutions. A survey method was chosen to measure the level of compliance with Financial Accounting Standard No. 8 (Ijarah and Ijarah Muntahia Bittamleek) and respondents were required to rank their perceptions on the level of compliance of each paragraph based on five-point Likert scale techniques. Questionnaire was distributed to the Islamic banks in Bahrain to obtain their perceptions about the level of compliance with Financial Accounting Standard No.8. The main findings of this study show that the Level of Compliance with Financial Accounting Standard No. 8 is relatively high, which reflect the high level of understanding of this standard and its implications.  This paper contributes towards a better understanding of the need of Ijarah and Ijarah Muntahia Bittamleek standard No. 8 in Islamic financial institutions in Bahrain.

Keywords: Islamic Accounting, Accounting Standards, AAOIFI, Islamic Banks, Bahrain

Updated:: 04/02/2022 [syazmer]