Do you agree with the assertion that accounting can lead to perceptions of reality? Explain. In deciding whether to adopt a proposed accounting standard, should accounting rule making bodies consider whether that standard might induce socially irresponsible behavior on the part of economic decision makers? Islam accepts the fact that accounting is a social construction and itself constructs social reality but this social reality which the accounting constructs must conform to the dictates of Islamic belief.
A rule making body issues authorative shari’a auditing standards for all Islamic banks and other Islamic businesses and it will be the most effective way to eliminate problems within the Islamic economy. The most effort to develop a body of consistent standards for shari’a audits has been undertaken by the accounting and auditing organization for Islamic financial institutions (AAOIFI). 4) Identify the key challenges that the big four firms will likely face in their efforts to establish a major presence in the Islamic banking industry. The role of the external auditor to Islamic financial institutions requires a different skill set and experience to that possessed by some accounting organizations. * Issuing a marketing brochure that identifies the wide range of professional services the firm could offer Islamic banks. * Meeting the needs of Islamic financial institutions across national boundaries. * Leading providers of professional accounting, auditing, and consulting services to the Islamic finance sector. * Hiring an Islamic religious scholar. * Offering shari’a audit services.