Title: Assessment of fair value accounting from the Islamic perspective

Authors: Ika Sari Wahyuni-TD

Addresses: Department of Accounting, Faculty of Economics, Kampus Limau Manih, Universitas Andalas, 25163 Padang, Indonesia

Abstract: The purpose of this paper is to explore the emerging issues of fair value accounting (FVA) from Islamic perspective. Previous literature is reviewed to identify the issues of fair value accounting from Islamic perspective. In this paper, the reliable and objective issues, gharar issue, unethical issue, zakah issue and three-tier hierarchy issue are discussed in FVA. In order to avoid Shari'ah issues in accounting measurement, the valuation basis used for the measurement of assets and liabilities should consider the types and the nature of assets and liabilities. Moreover, accountants in doing their professional duties are required to have the code of ethics based on Holy Quran and Shari'ah principles in order to get paramount rewards from Allah SWT in the hereafter. Therefore, the discussion of Shari'ah issues in this paper is expected to be useful as a sharing knowledge of the matters and challenges faced by Muslims when dealing with FVA.

Keywords: fair value accounting; FVA; reliable and objective issues; gharar issue; unethical issue; zakah issue; three-tier hierarchy issue.

DOI: 10.1504/IJAAPE.2017.087236

International Journal of Accounting, Auditing and Performance Evaluation, 2017 Vol.13 No.4, pp.325 - 338

Received: 16 Jul 2015
Accepted: 21 Jul 2016

Published online: 11 Oct 2017 *

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