THE DIFFERENCES BETWEEN WESTERN VIEWS AND ISLAMIC VIEWS OF FINANCIAL REPORTS WITH RELATIONS TO THE FIVE OBJECTIVES OF SHARIAH AND THREE LEVELS OF MAQASID PARADIGM

Abstract

Financial reporting are one of the most important elements that is usually use to know the financial information in an organisation either it’s finance is in a good condition or otherwise. The purpose of this paper is to enhance one's knowledge base by discussing and sharing the current inconsistencies between western and Islamic financial reports. The following are the study's objective in further detail which are to know the inconsistencies between western and Islamic financial reports as well as to analyse the relationship of financial reports with the five objectives of shariah and three levels of maqasid paradigm. The problems arise in this issues are due to the conflicts between western and Islamic views on financial reports in organisations as well as conflicts in the used of financial reports from western views or Islamic views in Islamic organisations. The methodology applied is qualitative, which are study through articles and journals. Therefore, the findings that are found in this study is the analysis of comparative between the financial reports from western or conventional views and Islamic views in terms of the balance sheet and income statement like zakat elements and Islamic derivatives financial instruments in Islamic views. There is a lack of academic research in the comparative of financial reports from western views and Islamic views especially in terms of its relationship with the five objectives of shariah and three levels of maqasid paradigm (al-dharuriyyat, al-hajiyyat and al-tahsiniyyat). Thus, this study provides the information on the comparative analysis between the two views as well as the relationship with the five objectives of shariah and three levels of maqasid paradigm.