The Practice of Islamic Bank in Zakat Distribution: The Case of Malaysia

Abstract

AbstractIslamic banks have been bombarded with the accusations being the same with its conventional sides. Consequently, the public are not convinced with the title ‘Islamic’ that Islamic banks have been carrying. Despite a growing literature on the reporting practices of Islamic banks, there is a need of research on the role of Islamic banks in zakat distribution. This descriptive, content analysis examined the annual reports and financial statements of Islamic banks to explore information that can be found in these documents. Documents from year 2018 until year 2020 was searched using their individual website and downloaded. Results indicated that Islamic banks do not disclose much information on zakat distribution, since it is considered as voluntary disclosure. Annual reports and financial statements are means of corporate communication to the public. Thus, disclosing such information is recommended.KeywordsIslamic banksZakat distributionAnnual reportsFinancial statements