The duo will collaborate in promoting the implementation of prudential, Shari’ah, accounting and governance standards to facilitate the development of the Islamic financial services industry.
The Islamic Financial Services Board (IFSB) has signed a MoU with the Accounting and Auditing organisation for Islamic Financial Institutions (AAOIFI) to jointly undertake technical activities relating to development and revision of prudential, Shari’ah, accounting and governance standards.
In a statement, the IFSB stated that the duo also agreed to work together in raising awareness on emerging issues in the Islamic financial services industry.
Dr. Bello Lawal Danbatta, the Secretary-General of IFSB, said that this MoU between the IFSB and AAOIFI paves way for strengthening coordination and combining efforts for the sustained growth, development and resilience of the Islamic financial services industry.
Islamic finance is growing fast across markets in Africa, the Middle East and Southeast Asia, but it remains a fragmented industry with the uneven implementation of its rules, which could stunt growth.
“The industry must have its footings on strong and sustainable principles and both the institutions need to strive for that together,” added Omar Mustafa Ansari, Acting Secretary-General of AAOIFI.
AAOIFI and IFSB have traditionally worked separately on their respective mandates. The AAOIFI focuses on accounting and auditing standards on one hand and the IFSB develops prudential rules in areas including capital adequacy and disclosure requirements.