Integrated Islamic Financial Accountability Model for Islamic Social Enterprise (ISE)
DOI:
https://doi.org/10.33102/jmifr.v16i1.206Keywords:
Financial accountability, Islamic accountability, Islamic Social Enterprise (ISE), Financial management, Islamic social accountingAbstract
This study aims to present an integrated Islamic financial accountability model, which is different from previous accountability models and frameworks. In this case, all three accountability aspects which are: (i) accountability to whom (accountability groups); (ii) accountability for what (accountability dimensions); and (iii) accountability on how (accountability tools and processes) were integrated into a single model. By using these three accountability aspects, this model is specifically focused on financial accountability area with additional Islamic elements that suits Islamic Social Enterprise (ISE). In order to develop this model, this study applies the comparison method on previous accountability and Islamic accountability models with additional literature inputs from financial accountability aspects and Islamic accountability perspectives. Based on the findings, this study introduces an integrated Islamic financial accountability model specifically for ISE, one of the emerging institution types under the non-profit sector. It is hoped that the integrated Islamic financial accountability model developed in this study will be implemented by the management of ISE in order to discharge their accountability especially to donors, beneficiaries and other stakeholders.
Downloads
References
Abbasi, A. S., Rehman, K. U. & Bibi, A. (2010). Islamic management model. African Journal of Business Management, 4(9), 1873-1882.
Abdul Kadir, M. A. B. & Mhd Sarif, S. (2015). Social enterprise sustainability: An exploratory case of selected private Islamic schools in Malaysia. International Academic Research Journal of Social Science, 1(2), 255-263.
Abraham, A. (2003). Financial sustainability and accountability: A model for nonprofit organisations, 2003(July), 6-8.
Agyemang, G., Awumbila, M., Unerman, J. & O’Dwyer, B. (2009). NGO Accountability and Aid Delivery. Research Report 110 ACCA.
Ahmad, S. F. (1988). The ethical responsibility of business: Islamic principles and implications. Journal of Objective Studies, 3(1), 23-43.
Al-alak, A., B. & Alnawas, I. A. (2010). Evaluating the effect of marketing activities on relationship quality in the banking sector: The case of private commercial banks in Jordan. International Journal of Marketing Studies, 2(1), 78-91. DOI: https://doi.org/10.5539/ijms.v2n1p78
Ali, A. J. (2010). Islamic challenges to HR in modern organizations. Personnel Review, 39(6), 692-711. DOI: https://doi.org/10.1108/00483481011075567
Alterman, B, J., Hunter, S. & Philips, A. L. (2005). The idea and practice of philanthropy in the Muslim world. US Agency for International Development: United States.
Bakker, I. (2002). Fiscal policy, accountability and voice: The example of gender responsive budget initiatives (No. HDOCPA-2002-01). Human Development Report Office (HDRO), United Nations Development Programme (UNDP).
Baydoun, N. & Willet. (1997). Islam and accounting: Ethical issues in the presentation of dinancial Information. Accounting; Commerce & Finance: The Islamic Perspective, 1(1), 1-25.
Behn, R. D. (2001). Rethinking democratic accountability. Brookings Institution Press.
Blagescu, M., de Las Casas, L. & Developing, R. L. (2005). Pathways to accountability. The GAP Framework. One World Trust: London.
Bovens, M. (2005). Public accountability: A framework for the analysis and assessment of accountability arrangements in the public domain. Unpublished paper.
Bovens, M. (2007). Analysing and assessing accountability: A conceptual framework. European Law Journal, 13(4), 447-468. DOI: https://doi.org/10.1111/j.1468-0386.2007.00378.x
Brinkerhoff, D.W. (2001). Taking account of accountability: A conceptual overview and strategic options. Draft Report, US Agency for International Development, Center for Democracy and Governance, Implementing Policy Change Project, Phase 2.
Brinkerhoff, D. W. (2004). Accountability and health systems: Toward conceptual clarity and policy relevance. Health Policy and Planning, 19(6), 371-379. DOI: https://doi.org/10.1093/heapol/czh052
Brown, L. D. & Mark, M. H. (2001). Accountability, strategy, and international Non-Governmental Organizations. Nonprofit and Voluntary Sector Quarterly, 30(3), 569-587. DOI: https://doi.org/10.1177/0899764001303012
Candler, G. & Dumont, G. (2010). A non‐profit accountability framework. Canadian Public Administration, 53(2), 259-279. DOI: https://doi.org/10.1111/j.1754-7121.2010.00126.x
Chene, M. (2013). Key features of NGO accountability systems. Transparency International, 358, 1-11.
Cornwall, A., Lucas, H. & Pasteur, K. (2000). Introduction: Accountability through participation: developing workable partnership models in the health sector. IDS Bulletin, 31(1), 1-13. DOI: https://doi.org/10.1111/j.1759-5436.2000.mp31001001.x
Department of Trade and Industry (DTI). (2002). Social enterprise: A strategy for success. Retrieved on 25th May 2017 from http://www.dti.gov.uk.
Dykstra, C. A. (1939). The quest for responsibility. American Political Science Review, 33(1), 1-25. DOI: https://doi.org/10.2307/1949761
Ebrahim, A. (2003a). Accountability in practice: Mechanisms for NGOs. World Development, 31(5), 813-829. DOI: https://doi.org/10.1016/S0305-750X(03)00014-7
Ebrahim, A. (2003b). Making sense of accountability: Conceptual perspectives for Northern and Southern nonprofits. Nonprofit Management and Leadership, 14(2), 191-212. DOI: https://doi.org/10.1002/nml.29
Ebrahim, A. (2009). Placing the normative logics of accountability in “thick” perspective. American Behavioral Scientist, 52(6), 885-904. DOI: https://doi.org/10.1177/0002764208327664
Ebrahim, A. (2010). The many faces of nonprofit accountability. The Jossey-Bass Handbook of Nonprofit Leadership and Management, 101-121.
Ebrahim, A. & Weisband, E. (2007). Global accountabilities: Participation, pluralism and public ethics. Cambridge University Press: United Kingdom. DOI: https://doi.org/10.1017/CBO9780511490903
Edwards, M. & Hulme, D. (1996). Too close for comfort? The impact of official aid on nongovernmental organizations. World Development, 24(6), 961-973. DOI: https://doi.org/10.1016/0305-750X(96)00019-8
Eisenberg, M. A. (1997). The board of directors and internal control. The Cardoza Law Review, 19(1-2), 237-264.
Gagne, R. L. (1996). Accountability and public administration. Canadian Public Administration, 39(2), 213-225. DOI: https://doi.org/10.1111/j.1754-7121.1996.tb00127.x
Goddard, A. (2004). Budgetary practices and accountability habitus: A grounded theory. Accounting, Auditing & Accountability Journal, 17(4), 543-577. DOI: https://doi.org/10.1108/09513570410554551
Goetz, A. M. (2002). Voice, accountability and human development: The emergence of a new agenda (No. HDOCPA-2002-04). Human Development Report Office (HDRO), United Nations Development Programme (UNDP).
Gray, R., Owen, D. & Dams, C. (1996). Accounting and accountability: Changes and challenges in corporate social and environmental reporting. Prenctice Hall Europe, Hemel Hempstead.
Guo, C. & Musso, J. A. (2007). Representation in nonprofit and voluntary organizations: A conceptual framework. Nonprofit and Voluntary Sector Quarterly, 36(2), 308-326. DOI: https://doi.org/10.1177/0899764006289764
Hati, S. R. H. & Idris, A. (2014). Antecedents of customers’ intention to support Islamic social enterprises in Indonesia. Asia Pacific Journal of Marketing and Logistics, 26(5), 707-737. DOI: https://doi.org/10.1108/APJML-08-2014-0126
Htay, S. N. N., Salman, S. A., Myint, S. & Ilyas, H. (2014). Integrating zakat, waqf and sadaqah: Myint Myat Phu Zin clinic model in Myanmar. Tazkia Islamic Finance and Business Review, 8(2), 170-186.
Huse, M. (2005). Accountability and creating accountability: A framework for exploring behavioural perspectives of corporate governance. British Journal of Management, 16(1), 65-79. DOI: https://doi.org/10.1111/j.1467-8551.2005.00448.x
Ibrahim, S. H. M. (2000). The need for Islamic accounting: Perception of its objective and characteristics by Malaysian accountants and academics (Doctoral dissertation). University of Dundee, United Kingdom.
Ibrahim, S. H. M. & Yaya, R. (2005). The emerging issues on the objectives and characteristics of Islamic accounting for Islamic business organizations. Malaysian Accounting Review, 4(1), 75-92.
Ihsan, H. (2007). An exploratory study of waqf accounting and management in Indonesian waqf institutions: The cases of Dompet Dhuafa and UII Waqf Foundations (Unpublished master dissertation). International Islamic University Malaysia, Malaysia.
ISRA. (2012). Islamic financial system: Principles & operations (Hard Cover Edition). International Shari’ah Research Academy for Islamic Finance (ISRA): Kuala Lumpur.
Jacobs, A. & Wilford, R. (2007). Putting new approaches to NGO accountability into action. In Paper for the Development’s Futures Conference. Galway: National University of Ireland.
Jordan, L. (2005). Mechanisms for NGO accountability. GPPi Research Paper Series No.3. Berlin, Germany.
Jordan, L. & Van Tuijl, P. (2006). NGO Accountability: Politics, principles and innovations. Routledge.
Kaldor, M. (2003). Civil Society and accountability. Journal of Human Development, 4(1), 5-27. DOI: https://doi.org/10.1080/1464988032000051469
Kearns, K. P. (1994). The strategic management of accountability in non-profit organizations: An analytical framework. Public Administration Review, 54(2), 185-192. DOI: https://doi.org/10.2307/976528
Keating, E. K. & Frumkin, P. (2003). Reengineering nonprofit financial accountability: Toward a more reliable foundation for regulation. Public Administration Review, 63(1), 3-15. DOI: https://doi.org/10.1111/1540-6210.00260
Kerlin, J. A. (2006). Social enterprise in the United States and Europe: Understanding and learning from the differences. Voluntas: International Journal of Voluntary and Nonprofit Organizations, 17(3), 247-263. DOI: https://doi.org/10.1007/s11266-006-9016-2
Kovach, H., Neligan, C. & Burall, S. (2003). The global accountability report: Power without accountability? One World Trust: London.
Kumar, S. & Nunan, K. (2002). A lighter touch: An evaluation of the governance project. Joseph Rowntree Foundation/YPS: London.
Laughlin, R. C. (1990). A model of financial accountability and the church of England. Financial Accountability & Management, 6(2), 93-114. DOI: https://doi.org/10.1111/j.1468-0408.1990.tb00202.x
Lee, J. (2004). NGO accountability: Rights and responsibilities. Geneva, Switzerland.
Leen, M. (2006). NGO accountability: Issues, lessons and challenges for Dóchas and its members. Dóchas: Dublin.
Lewis, M. K. (2001). Islam and accounting. Accounting Forum, 25(2), 103-127. DOI: https://doi.org/10.1111/1467-6303.00058
Lewis, M. K. (2006). Accountability and Islam. Paper presented at Fourth International Conference on Accounting and Finance in Transition. Adelaide, Australia.
Lloyd, R., Oatham, J. & Hammer, M. (2007). 2007 Global accountability report. One World Trust: London.
Kamaruddin, M. I. H. & Auzair, S. M. (2018). Classification of Islamic social enterprise in Malaysia based on economic sectors. Management and Accounting Review, 17(2), 17-42. DOI: https://doi.org/10.24191/mar.v17i2.784
Kamaruddin, M. I. H. & Ramli, N. M. (2015). Enhancing financial accountability of Islamic philanthropic organizations through financial disclosure. Online Journal Research in Islamic Studies, 2(1), 29-42.
Kamaruddin, M. I. H. & Ramli, N. M. (2018). The impacts of internal control practices on financial accountability in Islamic non-profit organizations in Malaysia. International Journal of Economics, Management and Accounting, 26(2), 365-391.
Masruki, R., Hussainey, K. & Aly, D. (2018). Financial impact on the accountability of Malaysian State Islamic Religious Councils (SIRC). The Journal of Muamalat and Islamic Finance Research, 15(2), 21-38. DOI: https://doi.org/10.33102/jmifr.v15i2.175
Muhamed, N. A., Kamaruddin, M. I. H. & Nasrudin, N. S. M. (2018). Positioning Islamic Social Enterprise (ISE). Journal of Emerging Economies and Islamic Research, 6(3), 28-38. DOI: https://doi.org/10.24191/jeeir.v6i3.8785
Muhamed, N. A., Ramli, N. M., Shukor, S. A. & Kamaruddin, M. I. H. (2016). Governing the Islamic Social Enterprise (iSE). In Critical Readings in Islamic Social Finance. Vol. 2, YTI Lecture Series (pp. 205–227). USIM Press.
Muliyaningsih, H. D. (2013). Social Entrepreneurship in Islamic Social Welfare System.
Nahar, S. H. & Yaacob, H. (2011). Accountability in the sacred context: The case of management, accounting and reporting of a Malaysian cash awqaf institution. Journal of Islamic Accounting and Business Research, 2(2), 87-113. DOI: https://doi.org/10.1108/17590811111170520
Najam, A. (1996). NGO accountability: A conceptual framework. Development Policy Review, 14(4), 339-354. DOI: https://doi.org/10.1111/j.1467-7679.1996.tb00112.x
O’Dwyer, B. & Unerman, J. (2007). From functional to social accountability: Transforming the accountability relationship between funders and non-governmental development organisations. Accounting, Auditing & Accountability Journal, 20(3), 446-471. DOI: https://doi.org/10.1108/09513570710748580
Obaidullah, M. & Shirazi, N. S. (2015). Islamic social finance report 1436H. Islamic Research and Training Institute (IRTI): Jeddah.
Office, C. (2006). Social enterprise action plan scaling new heights. London, UK.
Osman, A. Z. (2010). Accountability of waqf management: Insight from praxis of Non-governmental Organisation (NGO). In Proceedings of Seventh International Conference The Tawhidi Epistemology: Zakat and Waqf Economy, 153-175.
Osman, A. Z. (2012). Accountability in managing waqf properties: The case of two State Religious Councils in Malaysia (Doctoral thesis). Royal Holloway University of London, United Kingdom.
Ramli, N. M., Muhamed, N. A. & Kamaruddin, M. I. H. (2016). The financial management perspectives of Islamic social enterprise. In Nurul Aini Muhamed & Obaidullah, M. (Eds.), Critical readings in Islamic social finance. Vol. 2, YTI Lecture Series (pp. 229-254). Negeri Sembilan: USIM Press.
Raffer, K. (2004). International financial institutions and financial accountability. Ethics & International Affairs, 18(2), 61-77. DOI: https://doi.org/10.1111/j.1747-7093.2004.tb00468.x
Romzek, B. S. & Dubnick, M. J. (1987). Accountability in the public sector: Lessons from the challenger tragedy. Public Administration Review, 47(3), 227-238. DOI: https://doi.org/10.2307/975901
Shafritz, J. M. (1992). The HarperCollins dictionary of American government and politics. New York, N.Y: HarperPerennial.
Saad, R. A. J., Aziz, N. M. A. & Sawandi, N. (2014). Islamic accountability framework in the zakat funds management. Procedia-Social and Behavioral Sciences, 164, 508-515. DOI: https://doi.org/10.1016/j.sbspro.2014.11.139
Siraj, S. A. (2012). An empirical investigation into the accounting, accountability and effectiveness of waqf management in the State Islamic Religious Councils (SIRCs) in Malaysia (Doctoral dissertation). Cardiff University, United Kingdom.
Siraj, S. A. & Karbhari, Y. (2014). Financial Accountability of Waqf (Pious Endowment) Institutions in Malaysia: The Case of Budgeting Practices in State Islamic Religious Councils. In British Accounting and Finance Association 2014 Conference, 1-24.
Sloan, M. F. (2009). The effects of nonprofit accountability ratings on donor behavior. Nonprofit and Voluntary Sector Quarterly, 38(2), 220-236. DOI: https://doi.org/10.1177/0899764008316470
Spear, R., Cornforth, C. & Aiken, M. (2009). The governance challenges of social enterprises: Evidence from a UK empirical study. Annals of Public and Cooperative Economics, 80(2), 247-273. DOI: https://doi.org/10.1111/j.1467-8292.2009.00386.x
Downloads
Published
How to Cite
Issue
Section
License
Copyright (c) 2019 Muhammad Iqmal Hisham Kamaruddin, Sofiah Md Auzair
This work is licensed under a Creative Commons Attribution 4.0 International License.
