AAOIFI clarification of media reports

The Accounting and Auditing Organisation for Islamic Financial Institutions (AAOIFI) has issued clarification of recent news reports.

Referring in particular to news carried by Reuters, AAOIFI said, “In particular, Thomson Reuters had included the following sentences in their reports:

AAOIFI plans to improve the operations of sharia boards by strengthening the certification process for scholars, Fakih said.

AAOIFI will also look at ways of fostering the rise of a new, younger generation of Islamic scholars, through steps such as training courses, Fakih said.

To balance opposition to change within AAOIFI, Fakih seems to want to involve the widest possible range of industry interests in the debate; he called for "rigorous and meaningful discussions...not only among scholars but also with all participants of Islamic finance." AAOIFI, one of the top standard-setting bodies in Islamic finance globally, will over the next couple of years conduct a broad review of how the industry operates, addressing issues such as how boards of scholars work, the organisation's secretary-general Khaled Al Fakih said earlier.

(1), and (3) were included in a report entitled "AAOIFI in wide review of Islamic finance standards" dated 29 April 2012 while (4) in a report entitled "AAOIFI issues 7 Shari'a standards for Islamic finance" dated 30 April 2012.

“We would like to clarify that neither AAOIFI nor Dr Khaled R Al-Fakih had issued statements (1), and (4) above.

“The quotation on (3) was given to Thomson Reuters only in response to its written questions relating to AAOIFI's upcoming Shari'a Conference. Thomson Reuters ' written questions were:

What is the priority of the themes to be discussed at the conference?

What is the level of debate among scholars - which areas remain contentious, if any?

What are some of the outcomes expected from the May conference?

What is the status of the review of standards, when can we expect an announcement of this?

“In response to Thomson Reuters ' specific question on What is the level of debate among scholars - which areas remain contentious, if any?, AAOIFI had submitted a written reply that "we are hoping for rigorous and meaningful discussions at the conference, not only among scholars but also with all participants of Islamic finance industry. In particular, we would like to see insightful debate on Repo and hedging that can help us develop standards that can benefit the industry."

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