Abstract
Zakat accounting means the process of identifying assets required for zakat, determining the conditions of assets, confirming the applicable zakat rates, and assessing the zakat on the related assets. The rate of payable zakat was determined at 2.5 per cent. However, it is argued if zakat were imposed on the shares' capital value. Is it fair and sensible if zakat based on physical asset is imposed solely on the income generated by the asset? Data were collected from documents analysis. The data then analyzed by content analysis. As a result, on 7th July 2011, Selangor government has issued the fatawa that zakat for unit trust would be based on ‘urud tijarah (trade goods). Meaning, zakat is imposed on the value of the shares and the income generated from the share. Based on content analysis of secondary data, the result shows that the zakat accounting for IUTF must be based on the intention of owning the shares in IUTF.
Highlights
Investment means turning an asset into funds with the expectation that it will generate positive income and/or preserving or increasing its value (Smart et al, 2014)
Zakat accounting means the process of identifying assets required for zakat, determining the conditions of assets, confirming the applicable zakat rates, and assessing the zakat on the related assets
According to JAWHAR's manual and the State Fatwa Committee, it showed that zakat accounting for shares is divided into two methods
Summary
Investment means turning an asset into funds with the expectation that it will generate positive income and/or preserving or increasing its value (Smart et al, 2014). Investment can be made either in physical assets or in financial assets. Physical assets can be a tangible asset such as land, buildings, vehicles, gold and silver and financial assets are bonds, shares and trust funds. Investment can be divided into two types. Short-term investments are investments in current assets such as cash, accounts receivable, inventory, and securities. INTERNATIONAL JOURNAL OF ACADEMIC RESEARCH IN ACCOUNTING, FINANCE AND
Sign-in/Register to view highlights & summary Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callMore From: International Journal of Academic Research in Accounting, Finance and Management Sciences
Disclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
