The paper also argues that the Financial Reporting Council (FRC), as proposed Financial Reporting Act 2015 (FRA) should not be handled by non-experts body. which must be overcome for successful adoption of IAS/IFRS. Some challenges also exist like the development of a legal and regulatory framework, low audit fees, awareness campaign and training of personnel etc. IFRS adoption promises a lot of benefits like decreased cost of capital, improved financial reporting quality, increased ability to secure borders-listing, better Access to Global Capital Markets and attraction of foreign direct investment, etc. The study is purely based on the information from prior works of literature and secondary data sources. The objectives of this paper are to identify the development of the accounting profession in Bangladesh, the legal and regulatory framework of accounting, IFRS adoption process, benefits and challenges of adopting IFRS in Bangladesh. The study focuses on the recent adoption status of International Financial Reporting Standards (IFRS) in a developing economy like Bangladesh. Transparency protected the Islamic banking transactions from falling into the subprimes crisis. Furthermore, by considering a sample of AAOIFI accounting standards 2 related Murabaha, to the Purchase Order and comparing it to conventional loans, we have concluded that financial transparency is more enforced in Islamic banking than in conventional one. Besides the conventional disclosure, there is a disclosure on the basis of the distribution of revenues, the determination of selling prices and the statement of the illegitimate part of bank activity. Hence, AAOIFI advocates high transparency. Nevertheless, the principles of Islamic finance, such as the prohibition of riba and gharar as well as the link to the real economy emphasize transparency in Islamic banking transactions. This leads to a lack of transparency of all important financial and non-financial information, lack of disclosure in the balance sheet such as bankruptcy and the real characteristics of traded financial instruments. This deficiency is caused by the lack of the determination of the rate of change of interest and the variable interest loans, the securitization and the sale of the debt. By examining the traditional accounting standards for transparency, namely IAS 1, IAS 24, IFRS 7 along with the Accounting and Auditing Organization for Islamic Financial Institutions (AAOIFI) standards, we have highlighted that despite the fact that the conventional banking strives to achieve transparency there is a lack of optimal transparency in conventional banking products. This study examines the criteria of transparency and disclosure in Islamic banking and compares them to conventional banking. This study expected to benefits the accounting standards setting bodies and the interested parties as an input for them to make decision whether all standards provided by IFRS is applicable for Islamic Financial Institutions(IFIs) or not. However continuous dialogue and consultation between International Accounting Standards Board (IASB) and the Accounting and Auditing Organization for Islamic Financial Institutions (AAOIFI) is needed to harmonize and minimize the difference between two frameworks. As the existence of Accounting and Auditing Organization for Islamic Financial Institutions (AAOIFI) is still relevant and essential for the development of Islamic financial institutions. Therefore a separate accounting framework for Islamic products and transactions is required. This study concludes that the adoption and application scenarios of IFRS in banking sector is satisfactory level and adoption of IFRS offered various benefits but a complete implementation of IFRS by Islamic banks have been proven to genuinely violate the shariah principles. Using exploratory analysis the study identifies and compares adoption and application scenarios of IFRS in traditional and Islamic banking sector as well as identifies major benefits and problems in adoption and application of IFRS in both sector. The study employs literature based method which is a kind of qualitative research approach. The purpose of this study is to comparatively analyze adoption and implementation of International Financial Reporting Standards (IFRS) in banking sector of Bangladesh both traditional and Islamic banking.
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