Accounting and Auditing Organizations for Islamic Financial Institutions (AAOIFI)

Examining international accounting standards suggests that they do not adhere to Islamic principles. The absence of standards for financial transactions and the lack of uniformity in banking product applications related to Islamic finance demonstrate the need for an organization and standard structure. In 1987, the Islamic Development Bank’s annual meeting agenda included Islamic Financial Institutions Accounting and Auditing Institution. The primary purpose of commissions is to develop accounting standards for interest-free financial institutions. Various studies and reports are published alongside the commission’s activity. Accounting and Auditing Organisation of Islamic Finance Institutions was founded in Algeria in 1990, but the date it officially became an international legal entity is in 1991. It is a nonprofit organization. Through training, conferences, symposia, and periodicals, it seeks to advance the understanding of accounting and auditing in institutions operating under the interest-free financial system. AAOIFI prepare Fiqh provisions and interest-free standards for publication and explanation.