AAOIFI CPFAS case studies
AAOIFI CPFAS · Put your knowledge to work in context.
The AAOIFI Certified Professional in Financial Accounting Standards (CPFAS) - rendered in Arabic as شهادة المحاسب الإسلامي المعتمد, "the Certified Islamic Accountant" - is one of the professional certifications listed on the AAOIFI website alongside the Certified Shari'ah Reviewer and Auditor certificate, the Fast Track Fellowship and the Honorary Fellowship. AAOIFI itself (the Accounting and Auditing Organization for Islamic Financial Institutions) is a non-profit international body founded by founding agreement signed on 1 Safar 1410H / 26 February 1990 in Algeria and registered in the Kingdom of Bahrain on 11 Ramadan 1411H / 27 March 1991, with its principal headquarters in Bahrain. The AAOIFI CPFAS case studies are 5 cases and about 2,525 words.
1Murabaha Receivable Impairment and the Cost-Plus Disclosure
A retail Islamic bank has a murabaha portfolio with a gross carrying amount of 480 million. Of this, 60 million relates to customers who are 95 days past due but the bank's credit team argues the delay is administrative and expects full recovery.
455 words, about 2 min2Mudaraba Profit Equalisation Reserve and the Investment Account Holder Split
An Islamic bank pools depositors' funds in a mudaraba with a 60:40 profit share (bank as mudarib: 60% of profit after the bank's own share of capital). In year 1 the pool earns a gross profit of 90 million before any reserve movements.
522 words, about 3 min3Shari'ah Governance: Fatwa Override and the Independence of the Shari'ah Board
A takaful operator's management committee approved a new savings product structured as wakala with an incentive fee. The product memo was reviewed by two of the five Shari'ah board members in an informal session; both raised no objection but noted they had not seen the actuarial model.
531 words, about 3 min4Ethics: Client Confidentiality, Conflict of Interest, and Whistleblowing
A senior finance manager at an Islamic bank is preparing the year-end accounts. She discovers that a large murabaha customer, also a board member's private company, has been granted a 9-month payment extension without the credit committee's approval and without disclosure to the audit committee.
514 words, about 3 min5Sukuk Classification and the Substance-over-Form Test
An entity issues a 200 million sukuk al-mudaraba with a 7-year term. The sukuk holders receive a distribution calculated as 6% of the issue amount, payable semi-annually, and the issuer has a contractual obligation to make the payment even if the mudaraba makes a loss; the shortfall is funded by the issuer's own resources.
503 words, about 3 min