Relationship Between the Shariah Council and The Board of Directors and Its Effect on The Financial Soundness of Islamic
Banks
Afef Khalil1*
1 University of Carthage-Tunisia
*Corresponding Author: [email protected]
Accepted: 15 December 2020 | Published: 31 December 2020
________________________________________________________________________________________
Abstract: This research paper aims to examine the relationship between the Shariah Board and the Board of Directors and to investigate its impact on the financial soundness of Islamic banks. We applied Regression analyzes to test the effect of characteristic linking the Shariah Board to the Board of Directors on the financial soundness of the Islamic banking using a Panel data composed of 61 Islamic banks from 2008 to 2014. The findings imply that meetings between the Board of Directors and the Shariah Board negatively impact the Islamic banking soundness. The purpose of this research paper is to provide new empirical ideas and results to increase our knowledge concerning the relationship between the governance and the financial soundness of Islamic banking. Thus, the study seems to be a very useful tool for information that adds value to Islamic banking.
Keywords: Board of Directors, Corporate Governance, Financial Soundness, Islamic Bank, Panel data, Shariah Board
_________________________________________________________________________
1. Introduction
Islamic financial institutions (IFI) are managed by two independent boards namely the Board of Directors and the Shariah Board (Nathan & Ribiere 2007; Ghayad 2008; Garas 2010; Khalil
& Chihi, 2020B). The Board of Directors and the Shariah Council are two essential bodies that affect the corporate governance of banks (Grassa & Matoussi, 2014; Khalil & Chihi, 2020A;
Khalil & Chihi, 2020B; Khalil & Chihi, 2020C; Khalil & Chihi, 2020D).
Khalil & Chihi (2020B) and Khalil & Taktak (2020) say that the Shariah Board is composed of shariah members who cover the monitoring of the Islamic banks transactions to insure compliance with Shariah laws. Plus, Shariah Council scholars and directors have similar roles, except the role of the Board of Directors which focuses on planning strategies, according to Quttainah et al., (2013) and Khalil & Chihi (2020B). The Shariah Council is based on historical and current events rather than building a future strategy (Accounting and Auditing Organization for Islamic Financial Institutions (AAOIFI), 2005). Besides, the Shariah Council is responsible for all shariah laws issues while the Board of Directors discusses global corporate governance (Dalwai et al., 2014; Khalil & Chihi, 2020B). Muneeza & Hassan (2011), suggest that the Shariah Board scholars should assume their functions as directors.
Despite the development of Islamic banks in the financial world, we note the non-existence of empirical works that study the characteristics linking the Board of Directors to the Shariah Council and their effect on the financial soundness of banks. This research study is, therefore,
an opportunity to examine the impact of the relationship between the Board of Directors and the Shariah Board on the financial soundness of Islamic banking from 2008 to 2014. The results show that meetings between directors and shariah members have a negative impact on the banks soundness.
This research study provides, also, an opportunity to investigate the literature review concerning the relationship between the Shariah Board and the Board of Directors and its effect on the financial soundness of Islamic banks. The next step is to represent the sample and introduce the variables measurement. This work will be closed by the results discussion and the conclusion.
2. Literature review and Hypothesis
To reduce the shariah risks and insure the survival of the IFI, the Board of Directors and the Shariah Council should work together (Hawkamah, 2011; Garas, 2012; Othman et al., 2012).
Therefore, the banks transactions will be controlled by the Shariah Council and the directors (Qutainah et al., 2013). Ghayad (2008) argues that the director has to present the necessary information to the Shariah Council.
According to Dalwai et al. (2014), the Board of Directors’ strategies related to the shariah principles cannot be approved by the directors without the Shariah Council agreement. In this sense, some financial activities are prohibited by the Shariah members to protect the rights of investors and avoid any violation of Islamic laws (Hamza, 2013; Mollah et al., 2016). Shariah members must prevent the directors from participating in transactions with higher risks during the financial failure (Merton, 1977; Khalil & Chihi, 2020B).
Khalil & Chihi (2020B) conducted a study composed of 32 Islamic banking over the period 2015-2018. Their results show that meetings between directors and the Shariah Board negatively affect the financial performance of banks. This finding is also confirmed by Almutairi & Quttainah (2017) for a sample of 100 Islamic banking from 1993 to 2014.
The Islamic Financial Services Board (IFSB) Corporate Governance Standards (2006) propose that the Shariah Council and the Board of Directors must meet at least twice a year to discuss the IFI development. Likewise, the corporate governance standards of Pakistan recommend that the Shariah Board and the Board of Directors meet at least once every six months (Ullah et al., 2014). The sign of this variable is expected to be positive:
H1. Meetings between the Shariah Board scholars and administrators positively influence the financial soundness of Islamic banks.
3. Methodology
3.1. Sample
Our sample is consisted of 61 Islamic banking during the period 2008-2014. We use the Islamic banks website to download the annual reports. We note that the inflation rate and the gross domestic product rate are extracted from the World Bank website 1.
3.2. Variables measurement
3.2.1. The dependent variable measure
According to Khalil & Taktak (2020), the financial soundness of banks is defined as follows:
Z-score = (ROA+K) / σ (ROA).
With, ROA= Return on assets; k = total equity/total assets; σ (ROA) = Standard deviation of ROA
3.2.2. The independent variables measures
A review of several studies on the Board of Directors and the Shariah Board permits us to choose one characteristic to analyze the interaction between the Shariah Council and the Board of Directors and its effect on the financial soundness of Islamic banking. We found: (MEET) is a binary variable that is equal to 1 if the Board of Directors and the Shariah Board meet together and 0 otherwise. We note that the data for the (MEET) variable are collected through the annual reports and the banks organizational structures.
To ameliorate our empirical findings, we use 7 control variables. T is the logarithm of total assets of Islamic banks, Age is the logarithm of the bank’s age, M is a binary variable that is equal to 1 if the Islamic banks have a central Shariah Board and 0 otherwise, S is a binary variable that is equal to 1 if the banks country applies the shariah rules on its legal framework and 0 otherwise, N is a binary variable which is equal to 1 if the bank uses the AAOIFI’s standards and 0 otherwise, P is the gross domestic product rate, XI is the inflation rate.
We propose the following model to test the effect of variable linking the Shariah Board to the Board of Directors on the financial soundness of Islamic banking:
Z−scoreit = C + β1 MEETit + β2 Tit + β3 Ageit + β4 Mit + β5 Sit + β6 Nit + β7 Pit + β8 XIit + εit
With, C: a constant, β1 ... β8: the coefficients to be estimated, εit: the error term, i: the individual which ranges from 1 to 61, t: the period which ranges from 2008 to 2014. According to Beck
& Katz (1995) and Khalil & Taktak (2020), we employ the Panel Corrected Standard Error (PCSE) method to avoid autocorrelation and heteroskedasticity problems and have more robust findings.
Table 1: Description of the used variables Variable
name Definition Measure
Z-score The dependent variable (ROA+K) / σ (ROA) MEET The meetings between the Shariah Council and
the directors
A binary variable that is equal to 1 if the directors and the Shariah Council meet together and 0 otherwise.
T The bank’s size The logarithm of total assets of Islamic banks.
Age The bank’s age The logarithm of the bank’s age.
M The central Shariah Board A binary variable that is equal to 1 if the Islamic banks have a central Shariah Board and 0 otherwise.
S The country legal framework
A binary variable that is equal to 1 if the banks country applies the shariah rules on its legal framework and 0 otherwise.
N The AAOIFI’s standards application A binary variable which is equal to 1 if the bank uses the AAOIFI’s standards and 0 otherwise
P The gross domestic product rate XI The inflation rate
4. Results and discussion
4.1. Descriptive statistics
Table 2 indicates that 30,679% of the Shariah Board and the Board of Directors have meetings.
This does not support the Pakistan's corporate governance standards suggesting that the Shariah Board has to meet with the Board of Directors at least two times a year (Ullah et al., 2014).
Plus, Table 2 indicates that 68,852% of the Islamic banking are governed by a central Shariah Board and 52.459% of the banks belong to countries which their legal frameworks employ shariah rules. 37.704% of the Islamic banking belong to countries that apply the AAOIFI standards.
Table 2: Frequency of binary variables
Variables MEET M S N
Frequency % 1 0 1 0 1 0 1 0
30.679 69.320 68.852 31.147 52.459 47.540 37.704 62.295
The mean for (T) is 8.791. Plus, Table 3 proves that the (Age) variable is between 0.477 and 1.792. The (P) variable has a mean of 3.676. The average of the (XI) variable is 8.166. The descriptive analysis indicates that the (XI) variable ranges from a minimum of (-4.900) to a maximum of 39.300. The (Z-score) variable has an average of 16.557.
Table 3. Descriptive statistics of the dependent variable and control variables
Variables Mean SD Median Min Max
T 8.791 2.095 9.129 2.305 11.887
Age 1.156 0.315 1.176 0.477 1.792
P 3.676 3.219 3.600 -6.600 17.700
XI 8.166 9.363 4.000 -4.900 39.300
Z-score 16.557 13.726 14.064 -1.359 71.489
4.2. Cross-Correlation Matrix and Test VIF
The Cross-Correlation matrix proves that all the correlations coefficients are less than 0.7, which supports the limit proposed by Kennedy (2008). Besides, it seems that all independent variables have a VIF value less than 10 (Gujarati, 1995).
Table 4: Cross-Correlation Matrix and VIF coefficients
MEET T Age M S N P XI VIF
MEET 1.000 1.16
T 0.019 1.000 1.03
Age -0.067 0.037 1.000 1.16
M 0.162 -0.008 -0.175 1.000 1.69
S 0.155 -0.015 0.000 0.493 1.000 2.51
N -0.004 -0.078 -0.044 0.450 0.672 1.000 2.00
P -0.085 0.016 -0.027 -0.043 -0.143 -0.131 1.000 1.17
XI 0.149 0.090 0.276 0.151 0.315 0.209 -0.357 1.000 1.41
4.3. Discussion
4.3.1. Meetings between the Shariah Board and the Board of Directors and the financial soundness
Table 5 shows that the (MEET) variable has a negative effect on the financial soundness of banks. This implies that meetings between directors and Shariah Board members have a negative effect on the financial soundness of Islamic banking. H1, thus, is not confirmed. The finding does not confirm the results of several studies (Almutairi & Quttainah, 2017; Hakimi et al., 2018; Haridan et al., 2018; Ramly et al., 2018), and shows that the Shariah Board and the Board of Directors cannot protect the Islamic banking during the financial failure and be good control mechanisms. Plus, shariah members and directors cannot decrease the inordinate risk- taking. Another plausible explanation of the finding, is that the shariah scholars forbid directors to invest in higher financial risk activities, or profitable and not consistent with shariah laws.
These increase the agency costs and conflicts between shariah experts and directors (Khalil &
Chihi, 2020B).
4.3.2. Control variables and the financial soundness
Table 5 shows that the coefficient associated with (M) variable is positive. This confirms the study of Grassa (2013) and indicates that the central Shariah Board reduces the conflict between Shariah Board members. (S) variable has a positive impact on the financial soundness of banks.
This means that the shariah rules are updated to the financial environment of Islamic banks (Khalil & Taktak, 2020). The coefficient associated with (N) variable is negative, which confirms the researches papers of Oud & Amedjar (2016) and Khalil & Taktak (2020) and implies that the Islamic banking correctly applies the AAOIFI’s standards. Furthermore, the findings show that other variables (T, Age, P, XI) do not have any significant impact on the financial soundness.
Table 5: Regression Results
Coef. Z P>|z|
T -0.248 -1.31 0.189
Age -0.262 -0.14 0.890
M 4.552 3.25 0.001***
S 8.889 4.10 0.000***
N -17.242 -8.07 0.000***
P 0.026 0.37 0.708
XI -0.037 -0.850 0.396
MEET -8.442 -6.60 0.000***
Cons 22.287 6.260 0.000***
R² 66.98%
N 427
Notes : *significant at 10 percent; ** significant at 5 percent and *** significant at 1 percent
4.4. Robustness test
Financial soundness can be analyzed by two approaches. The first approach applies the Z-score as a measure of the financial soundness. The second suggests a set of measures known as 'CAMELS' (IMF, 2006). To verify the robustness of the findings, we employ a robustness test for the year 2018. According to Khalil & Taktak (2020), we apply only two measures (Capital adequacy ratio (CAR), Earning and profitability ratio (EP)) due to the missing data in annual reports of Islamic banks:
- The (CAR) measure is calculated by two ratios (Khalil & Taktak, 2020): CA1 = Equity / Total Assets; CA2 = Equity / Total Liabilities
- The Earning and profitability (EP) measure is measured by two ratios (Khalil & Taktak, 2020): ROA = Net income / Total asset; ROE = Net income / Shareholder's equity, with ROA = Return on asset, ROE = Return on equity
4.4.1. Meetings between the Shariah Board and the Board of Directors and the financial soundness
Table 6 indicates that the coefficient on (MEET) variable is not significant on (CAR) indicator and (EP) indicator, which does not confirm our previous result (Table 5). H1, thus, is not supported. This finding means that meetings between directors and shariah scholars do not have any significant impact on the financial soundness of Islamic banks. This result contradicts the several research studies (Almutairi & Quttainah, 2017; Haridan et al., 2018; Ramly et al., 2018;
Ullah et al., 2018), proponents of passivity thesis and agency theory.
4.4.2. Control variables and the financial soundness
Table 6 indicates that (M) variable do not have any significant effect on the financial soundness of Islamic banks, which does not corroborate our previous finding (Table 5). (S) variable has a negative impact on the financial soundness of banks measured by (ROA) variable, which does not confirm our previous result. This means that the shariah rules are not updated to the Islamic banks’ financial environment. Besides that, the finding shows that the coefficient associated with (N) variable is positively measured by (CAR) indicator. This result does not support the researches of Oud & Amedjar (2016) and Khalil & Taktak (2020), and indicates that the Islamic banking efficiency uses the AAOIFI’s standards. Plus, other variables (T, Age, P, XI) do not have any significant impact on the financial soundness, which confirms our previous finding (Table 5).
Table 6: Robustness test Independent
variables
Capital Adequacy Ratio (CAR) Equity (EP)
CA1 CA2 ROA ROE
Coef. Z P>|z| Coef. Z P>|z| Coef. z P>|z| Coef. z P>|z|
T -3.441 -1.42 0.155 11.249 1.20 0.230 -0.657 -1.38 0.167 -2.519 -1.03 0.304 Age -28.877 -1.70 0.089* -107.770 -2.03 0.042** 0.757 0.18 0.854 39.996 1.34 0.180 M -1.283 -0.190 0.852 7.716 0.28 0.776 -0.666 -0.29 0.775 10.008 1.01 0.312 S -1.942 -0.29 0.775 -0.515 -0.03 0.980 -6.328 -2.68 0.007*** -17.122 -1.27 0.203 N 29.254 2.87 0.004*** 162.867 2.71 0.007*** 0.564 0.36 0.717 -7.489 -1.11 0.265 P -0.061 -0.09 0.929 2.361 0.88 0.377 0.154 0.52 0.604 0.426 0.66 0.512 XI -0.695 -2.85 0.004*** -4.343 -2.81 0.005*** 0.084 2.18 0.030** 0.033 0.21 0.831 MEET -0.796 -0.12 0.907 -7.233 -0.21 0.833 2.492 0.97 0.332 15.076 1.09 0.277 Cons 84.833 2.69 0.007*** 144.331 1.53 0.125 8.204 1.28 0.201 -26.370 -0.80 0.424
R² 28.55% 25.81% 18.30% 19.85%
N 61 61 61 61
Notes : *significant at 10 percent; ** significant at 5 percent and *** significant at 1 percent
5. Conclusion
According to Khalil & Chihi (2020B), the Board of Directors and the Shariah Board are the two most important organs that affect the corporate governance of banks. Khalil & Taktak (2020) add that the Shariah Council and the Board of Directors share control responsibilities and support each other.
Thus, this research paper aims to analyze the effect of the characteristic linking the Shariah Board to the Board of Directors on the financial soundness of Islamic banking. The result indicates that meetings between the Board of Directors and the Shariah Board have a negative effect on the financial soundness of Islamic banking. This means that the relationship between directors and shariah scholars raises the agency costs and conflicts between shariah experts and directors and cannot protect the Islamic banking during the financial failure. To verify the robustness of the results, we employ other dependent variables (CAMEL) than the Z-score. We note that the finding belongs to the dependent variable and is not robust.
To the best of our knowledge, our study is the first to diagnose the relationship between the Shariah Board and the Board of Directors and to empirically study its effect on the financial soundness of Islamic Banking. It is recommended that future research papers can study other governance structures to improve the corporate governance framework of Islamic banking.
References
AAOIFI (2005). Accounting, Auditing and Governance Standards for Islamic Financial Institutions. Manama, Bahrain, Accounting and Auditing Organization for Islamic Financial Institutions.
AAOIFI (2010). Shariah Standards for Islamic Financial Institutions. Manama, Bahrain, Accounting and Auditing Organization for Islamic Financial Institutions.
Abdul Alim, E. (2014). Global Leaders in Islamic Finance. Industry Milestones and Reflections, Edition Wiley.
Abdul Rahman, A. & Bukair, A.A. (2013). The Influence of the Shariah Supervision Board on Corporate Social Responsibility Disclosure by Islamic Banks of Gulf Co-Operation Council Countries. Asian Journal of Business and Accounting. 6, 2,65-104.
Abdullah, M.A., Hassan, R., Omar, M.N., Napiah, M.D.M., Othman, A.A., Ariffin, M. &
Yusoff, A. (2014). A Study on the Shariah Decision Making Processes Adopted by the Shariah Committee in Malaysian Islamic Financial Institutions. Australian Journal of Basic and Applied Sciences. 8, 13, 670-675.
Ahmed, M. & Khatun M. (2013). The Compliance with Shariah Governance System of AAOIFI: A Study on Islamic Banks Bangladesh. Journal of Islamic Economics, Banking and Finance. 9, 3, 177-191.
Al Baraka Bank (2009). AlBaraka Annual Report 2009. South Africa. Available on:
http://www.albaraka.co.za/About_alBaraka/Financial_Information/Annual_Reports/Ann ualReport2009.aspx.
Bank Muamalat Indonesia (2009). Laporan Pelaksanaan Tata Kelola Perusahaan 2009, Good Corporate Governance Implementation Report. Indonesia. Available on:
http://www.bankmuamalat.co.id/download/file/2_annual-report 2009_20160609145510.pdf.
Bank Rakyat (2013). Leading Change Annual Report 2013. Malaysia. Available on: https://s3- ap
southeast1.amazonaws.com/bankrakyat/28072015/BANK_RAKYAT_2013_ENG.pdf.
Beck, N. & Katz, J.N. (1995). What to do (and not to do) with time-series cross-section data.
American Political Science Review. 89, 3, 634-647.
Besar, M.H.A.H., Sukor, M.E.A., Muthalib, N.A.M. & Gunawa, A.Y. (2009). The Practice of Shariah Review as Undertaken by Islamic Banking Sector in Malaysia. International Review of Business Research Papers. 5, 1, 294-306.
BNM (2010). Shariah Governance Framework for Islamic Financial Institutions. Islamic Banking and Takaful Department, RH/GL/012-23. Bank Negara Malaysia-Central Bank of Malaysia.
Dalwai, T., Chugh, G., Prasad, S. & Mohammadi, S.S. (2014). Can Effective Corporate Governance Of Islamic Banks Enhance Financial Inclusion In The Sultanate Of Oman?.
International Journal of Humanities and Social Sciences (IJHSS). 61-74.
Garas, S.N. & Pierce, C. (2010). Shariah Supervision of Islamic Financial Institutions. Journal of Financial Regulation and Compliance. 18, 4, 386-407.
Garas, S.N. (2010). The Performance of Shariah Supervisory Boards Within Islamic Financial Institutions In The Gulf Cooperation Council Countries. Corporate Ownership and Control..8, 1, 247-266.
Garas, S.N. (2012). The conflicts of interest inside the Shariah supervisory board. International Journal of Islamic and Middle Eastern Finance and Management. 5, 2, 88-105.
Ghayad, R. (2008). Corporate governance and the global performance of Islamic banks.
Humanomics. 24, 3, 207-216.
Ginena, K. (2014). Shariah risk and corporate governance of Islamic banks. Corporate Governance: The international journal of business in society. 14, 1, 86-103.
Grassa, R. & Matoussi, H. (2014). Corporate Governance Of Islamic Banks: A Comparative Study Between GCC And Southeast Asia Countries. International Journal of Islamic and Middle Eastern Finance and Management. 7, 3, pp.346-362.
Grassa, R. (2013). Shariah supervisory system in Islamic financial institutions: New issues and challenges: a comparative analysis between Southeast Asia models and GCC models.
Humanomics. 29, 4, 333-348.
Gujarati, D. (1995). Basic Econometrics. McGraw Hill, NY.
International Journal of Islamic and Middle Eastern Finance and Management. 6, 3, 226- 237.
Hasan, Z. (2010). Regulatory Framework of Shariah Governance System in Malaysia, GCC Countries and the UK. Kyoto Bulletin of Islamic Area Studies. 3, 2, 82-115.
Hassan, A. & Chachi, A. (2008). Corporate Governance of the Islamic Financial Services Industry in Brunei Darussalam. Journal of Islamic Economics, Banking and Finance. 4, 1, 1-21.
Hawkamah (2011). Policy Brief On Corporate Governance For Islamic Banks And Financial Institutions In The Middle East And North Africa Region. Hawkamah, The Institute for Corporate Governance.
Ibrahim, S.H.B.M., Wirman, A., Alrazi, B., Nor, M.N.B.M. & Pramono, S. (2012). Alternative Disclosure & Performance Measures For Islamic Banks. Working Paper, International Islamic University Malaysia.
IFSB (2006). Guiding Principles On Corporate Governance For Institutions Offering Only Islamic Financial Services (Excluding Islamic Insurance (Takaful) Institutions And Islamic Mutual Funds). Islamic Financial Services Board.
IFSB (2007). Guidance On Key Elements In The Supervisory Review Process Of Institutions Offering Islamic Financial Services (Excluding Islamic Insurance (Takaful) Institutions And Islamic Mutual Funds). Islamic Financial Services Board.
IMF (2006). Financial Soundness Indicators. International Monetary Fund.
Isa, M.Y.B.M. (2014). Islamic Banks Impaired Financing: Relationship Between Shariah Committee Meetings Frequency and Shariah Risks Compliance on Assets Quality.
Journal of Statistical Science and Application. 2, 47-54.
Kennedy, P. (2008). A Guide to Econometrics. Blackwell, Malden, MA.
Khalil, A. and Chihi, S. (2020A). Do board characteristics affect the financial soundness of Islamic banks. African Scientific Journal. 3, 2, 85-102.
Khalil, A. & Chihi, S. (2020B). Would meetings between the Board of Directors and the Shariah Supervisory Board affect the financial performance of Islamic banks?. Journal of the International Academy for Case Studies. 26, 6-186, 1-7.
Khalil, A. & Chihi, S. (2020C). Would foreign directors and women directors affect the financial performance of Islamic banking?. Journal of the International Academy for Case Studies. 26, 6-184, 1-5.
Khalil, A. & Chihi, S. (2020D). Does the Sariah Board structure influence the financial performance of Islamic banks?. Journal of the International Academy for Case Studies.
26, 6-185, 1-7.
Khalil, A. & Taktak N.B. (2020). The impact of the Shariah Board’s characteristics on the financial soundness of Islamic banks. Journal of Islamic Accounting and Business Research DOI: https://doi.org/10.1108/JIABR-08-2018-0127.
Merton, R.C. (1977). An Analytic Derivation of the Cost of Deposit Insurance and Loan Guarantees. Journal of Banking and Finance. 1, 3-11.
Mollah, S., Hassan, M.K., Farooque, O.A. & Mobarek, A. (2016). The governance, risk- taking, and performance of Islamic banks. Journal of Financial Services Research. 49, 1, 1-25.
Muneeza, A. & Hassan, R. (2011). Legal Obstacles in Shari’ah Corporate Governance of Islamic Financial Institutions in Malaysia. JKAU: Islamic Econ. 24, 2, 177-180.
Muneeza, A. & Hassan, R. (2014). Shariah corporate governance: the need for a special governance code. Corporate Governance. 14, 1, 120-129.
Nathan, S. & Ribière, V. (2007). From Knowledge to Wisdom: The Case Of Corporate Governance In Islamic Banking. The journal of information and knowledge management systems. 37, 4, 471-483.
Othman, A.A., Hassan, R., Omar, M.N., Napiah, M.D.M., Ariffin, M., Yusoff, A., Khatimin, N. & Zaharim, A. (2012). Shariah Governance for Islamic Financial Institutions in Malaysia on the Independency of Shariah Committee and Efficiency of Its Shariah Decisions. Recent Advances in Management, Marketing and Finances. 93-100.
Quttainah, M.A., Song, L. & Wu, Q., (2013). Do Islamic Banks Employ Less Earnings Management?. Journal of International Financial Management and Accounting. 24, 3, 203-233.
Shafii, Z. & Salleh, S. (2010). Enhancing Governance, Accountability And Transparency In Islamic Financial Institutions: An Examination Into The Audit Of Shariah Internal Control System. Malaysian Accounting Review. 9, 2, 23-42.
Shafii, Z., Salleh, S. & Shahwan, S. (2010). Management of Shariah non-compliance audit risk in the Islamic financial institutions via the development of Shariah compliance audit framework and Shariah audit programme. Kyoto Bulletin of Islamic Areas Studies. 3, 2, 3-16.
Ullah, H. (2014). Shariah compliance in Islamic banking. International Journal of Islamic and Middle Eastern Finance and Management. 7, 2, 182-199.
Ullah, S., Khokhar, Z.A., Tanveer, N., Khan, M.W., Shabbir, G. & Ahmed, A. (2014). Shariah Governance Framework For Islamic Banking Institutions. Islamic Banking Department, State Bank Of Pakistan.
Zainol, Z., Shaari, R. & Muhamad Ali, H. (2008). A Comparative Analysis of Bankers’Perceptions on Islamic Banking. International Journal of Business and Management. 3, 4, 157-168.
