PDF Notes: AAOIFI GS 1 Shari_ah Governance Framework (Revised 2024)

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    What is the purpose of a Shari’ah governance framework?

    Ensures compliance with Shari’ah principles in financial operations.

    What defines an Islamic financial institution (IFI)?

    Operates in accordance with Shari’ah principles in finance.

    What is the role of the Shari’ah supervisory board (SSB)?

    Reviews and supervises compliance with Shari’ah rules.

    How does an external Shari’ah audit differ from an internal audit?

    Provides independent assurance of Shari’ah compliance.

    What is a Fatwa?

    A Shari’ah opinion on specific incidents or queries.

    What is the significance of Maqasid Al-Shari’ah?

    Protects human interests through adherence to Shari’ah.

    What is the investment risk reserve (IRR)?

    Cushions against potential future losses for investors.

    What is the function of senior management in an IFI?

    Responsible for overall decision-making and operations.

    What is Shari’ah non-compliance risk?

    Risk from failing to adhere to Shari’ah principles.

    What distinguishes an Islamic finance window from an IFI?

    Operates within a conventional institution under Shari’ah.

    What is the profit equalisation reserve (PER)?

    Maintains investment return levels for stakeholders.

    What are public interest institutions?

    Entities of significant public relevance due to their operations.

    What is the objective of the AAOIFI Governance Standard?

    To improve Shari’ah compliance and governance quality.

    What is the role of regulatory and supervisory authorities (RSAs)?

    Oversee Shari’ah compliance and governance in institutions.