Determinants of financial reporting practices on Waqf by Malaysian`s State Islamic Religious Councils

Abstract

This study aims to examine the financial reporting practices of waqf as practiced by the State Islamic Religious Councils (SIRCs) in Malaysia. For the purpose of this study, 10 self-developed questionnaires have been posted to each of the 14 SIRCs specifically to those respondents who are involved directly in managing waqf. The study adopts questionnaires technique and study of annual reports of the SIRCs in order to examine the nature of the financial reports of the SIRCs. It also determines to evaluate the level of disclosure of information as disclosed in the annual financial reports. The study does not aim to generalize from the findings but rather to obtain the feedbacks and views of the officers who are involved directly in managing the financial accounts of waqf in the SIRCs. This is important to understand the nature of financial reporting practices from various groups of officers of SIRCs. The study provides evidence that the annual reports were categorized into three categories, i.e. latest annual report, overdue annual reports and out-dated annual reports. It also indicates that majority of the SIRCs showed a high level of disclosure of information on the financial report. However, most of them showed a low level of disclosure of information on the waqf financial report. This study indicates that in maintaining and updating the waqf financial reports most of the SIRCs referred to State Islamic Enactment with modification (SIEM). However, due to the insufficient guidelines in SIEM, SIRCs also referred to the other procedures (OP).