SII Involvement in Islamic Finance
Who we are
Setting professional standards
The IFQ
Educational standards as benchmarks for industry
Standards first or Qualifications first?
Key Information Origins in London Stock Exchange Setting
professional standards
A not-for-profit organisation
Board of Trustees
85 Full-time Staff
25,000 individual members
8,000 student members
38,000 exams each year
10,000 publications sold pa
International offices
53 countries
““““ To set standards of professional excellence and integrity for the
securities and investment industry, providing qualifications and promoting the highest level of competence to our
members, individuals and firms
Mission Statement
Three Main Activities:
KNOWLEDGE: An Awarding Body for Qualifications
SKILLS: A provider of Continuing Professional Development
BEHAVIOUR: A leader in Integrity & Ethical thinking
Who Takes our Qualifications?
Aviva
Barclays
Citigroup
Credit Suisse
Deutsche Bank
Goldman Sachs
HSBC
J P Morgan
Lloyds TSB
Merrill Lynch
Morgan Stanley
Nomura International
UBS
Alliances
Alliances & Partnerships vital
Firms
Training Deliverers
Professional bodies
Exam delivery partners
Islamic experts
A wide range of qualifications in the UK Financial services Industry
Used by firms to satisfy the Regulator to ensure staff are competent
Supported by HM Treasury
On the appropriate list of the UK Government’s Financial Services Skills Council (FSSC)
An approved Awarding Body by the UK Government regulator in Education, the QCA
Reputation as Centre of Excellence
Securities & Investment Institute
Setting Professional StandardsSetting Professional Standards
Continuing personal and professional
development
Knowledgeand
understanding
Skillsand
experience CompetenceCompetence
Why a UK Professional Body for the Islamic Finance Qualification?
Professional bodies focus on the conduct of the person as well as the passing of exams
The beliefs and philosophies underpinning Islam are totally synergistic with the professional body ethos
SII experience of setting Regulatory exams for Middle East Regulators
As the UK professional body for the Investment industry, this led to SII involvement in IFQ
SII familiar with working to national standards; deliver leading compliance exams in UK for FSA
SII’s respect for necessary involvement of Islamic finance practitioners and training skills: partnership with the Ecole Superieure des Affaires – the Leading Business School in the Middle-East
Initiated by Leading Central Bank - Banque du Liban
Partnership with leading Business School in Middle East - ESA
Advisory council for Islamic Finance
SII leader in conventional investment banking standards of competence
SII leader in ethics and integrity for investment sector
ESA successful experience in Islamic Finance Through its foundation for research and development in Islamic Finance: “Al Multaqa”
Draw on experience working with Government regulators in Egypt, UAE, Saudi Arabia, Dubai, Lebanon
Recognition of value of wide spectrum of Islamic finance specialistsand authors from many countries
Islamic Finance Qualification Islamic Finance Qualification An added-value for a fast growing industryAn added-value for a fast growing industry
What is unique about IFQWhat is unique about IFQ
Islamic ExpertiseIslamic Expertise + Training and Education expertise
Training and Education expertise = IFQ
Islamic Finance from both a technical perspective and Sharia’a perspective
Existing employees
New employees
Young people seeking a career
Muslims and non Muslims
Tested globally by Computer
IFQIFQSetting international benchmark accessed by all
Available from March 2007
Dr Abdul Sattar Abu Ghuddah Dr Ahmad Jachi
Dr Mohamad Nedal Alchaar Mansoor Shakil
Professor Simon Archer Samir Salameh
Stella Cox Abdulkader Thomas
Michael Saleh Gassner Brian Kettell
Imane Karich Dr Mohammed Imran Usmani
Jean-Marc Riegel Samer Hijazi
Ahmad Sabbagh Paul Sherrin
Waheed Qaiser
Training and examination assessment expertise from ESA and SII Staff
Qualifications can……..
Benchmark standards
Provide the foundation for measurable continuous learning regimes
Combine knowledge, skills and behaviour
Be used for ‘Approved Persons’ regimes to ‘police the perimeter’ of Financial Services
Become a global standard
Save many years of conventional standard setting in the field of personal and professional competence
‘Licence practitioners’
Islamic Finance Qualification (IFQ)
Combines the expertise of Islamic scholars and banking practitioners, Trainers and Business School leaders with the traditions of UK Professional Body standard setting for ethical conduct in the investment sector
Is available globally using the latest assessment technology
Is supported by major banks and finance institutions
Is a practical qualification blending knowledge and application
The IFQ – what does it cover?
The basis of Islamic banking and finance
Islamic law of contracts
The major contracts – Mudaraba, Musharaka, Murabaha, Ijara, Salam, Istisn’a, etc..
The accounting treatment of Islamic Finance Institutions: financial transactions according to IFRS and AAOIFI financial accounting standards
Corporate governance for Islamic Finance Institutions
Islamic asset and fund management
Islamic Bonds - Sukuk
Islamic insurance - Takaful
IFQ – Highlighting new standard setters (1)
Regulatory and prudential Standards:
The Islamic Financial Services Board (IFSB):
Corporate governance,
Risk Management,
Capital adequacy etc..
IFQ – Highlighting new standard setters (2)
Accounting & Sharia’a standards:
Accounting and Auditing Organization for Islamic Financial Institutions (AAOIFI)
Need for new accounting standards which include new dimensions such as:
• Religious & Ethical dimensions as a matter of religion
• New Accounting classes such as the Investment Account Holders. The latter are (to a certain extend) similar to depositors in conventional banking
Sharia’a supervisory Board Report which is not included in Institutions financial reports and notes.
Potential accounting challenges
Islamic Finance Institutions apply different accounting standards according to local regulations:
Different reporting policies,
Potential extra work needed for consolidation of subsidiaries’ accounts,
Potential transparency challenge for shareholders and investors (mainly Islamic Account Holders),
Big challenge for Islamic Finance Institutions who are looking to expand globally.
Challenge in case Islamic Finance institutions decide to go public,
Why potential resistance for new standards?
Extra work required from Islamic Finance Institutions,
Requires new knowledge and expertise of both regulators and practitioners:
Need to develop the expertise of the Islamic Finance industry,
Need to develop the knowledge and understanding of employees
Need for more global qualification: the IFQ
An International
BenchmarkQualification
IFQ
StandardsStandardsHarmonisation Harmonisation
Regulatory & Regulatory & Prudential Prudential standards standards
(IFSB)(IFSB)
PromotingPromotingGlobal GrowthGlobal Growth
In Islamic In Islamic FinanceFinance
Accounting & Accounting & Sharia’a Sharia’a
standardsstandards(AAOIFI)(AAOIFI)
ProductProductInnovation Innovation
MeetingMeeting
CustomerCustomerNeeds Needs
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