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The term “Shariah compliance” states that a firm conducts business activities within the boundaries stipulated by Islamic law. The purpose of this study is to empirically examine whether a firm’s Shariah compliance helps in reducing firm-specific stock price crash risk (SPCR).

Using the data of 10,391 firm-year observations of non-financial public listed firms in Malaysia from 2001–2017, this study uses the panel data estimation technique for regression analysis. Moreover, a series of alternative estimations has been applied to check the consistency of results.

The findings reveal a significant negative impact of firms’ Shariah compliance on SPCR. The results indicate that Shariah-compliant (SC) firms are less likely to hoard bad news, ultimately reducing SPCR. The results also unveil a possible mechanism through which SC firms reduce SPCR. The findings reveal that SC firms are less likely to be involved in earnings management, which reduces the risk of a stock price crash in SC firms. It highlights the behavioral differences in financial reporting between SC firms and Shariah non-compliant (SNC) firms.

This research adds to the existing literature of Islamic capital markets from the perceptive of SPCR. The SPCR exhibits a tail risk of the stocks and is very important for risk management and investment decisions. The findings of this study will help risk-averse investors to include SC firms in their investment portfolios for risk minimization. The results also guide policymakers and regulatory bodies to rethink the monitoring mechanisms of publicly listed firms.

This study is unique, as it highlights that firms’ Shariah compliance reduces SPCR.

The purpose of this paper is to investigate the awareness of non-Muslims coming from a non-Muslim-majority country regarding Islamic financial services, in particular, the takaful products.

This paper uses structured questionnaires to acquire and understand South Korean citizens’ perceptions of Islamic financial services (primarily takaful) to reinforce the scant previous literature in this area of research. The questionnaires are developed and adapted based on a previous study by Htay and Salman (2013). The sample consisted of 121 Korean people who were living in Ampang, a popular suburb for South Koreans in Kuala Lumpur.

The findings indicate that even South Korean citizens who have dwelled in Malaysia for a significant amount of time had little awareness of Islamic financial services. Upon personal explanation about the product, however, they showed a significant interest to get to know about takaful and a willingness to subscribe to it in the near future.

Respondents are limited to only South Koreans who are residing in Malaysia.

Understanding the level of awareness about Islamic financial services among non-Muslims residing in Muslim-majority country.

There is ample scope to penetrate the non-Muslim market for Islamic financial products.

There is a growing concern over the lack of research in the area of perceptions of Islamic financial services among non-Muslims from non-Muslim-majority countries. The lack of study in this area of research has often been overshadowed by research studies on perceptions of Islamic financial services among non-Muslim residents in Muslim-majority countries, which may have led to a dearth of proper strategies in the Islamic financial industry to penetrate non-Muslim-majority markets.

University students are known to face many challenges in achieving high financial literacy. The purpose of this paper is to examine the level of financial literacy among Malaysian Muslim undergraduates as explained through sociocultural variables. Furthermore, this paper explores a few additional Islamic measurements as part of assessing the level of financial literacy among the students.

The questionnaires were drafted based on a multi-dimensional financial literacy model and distributed conveniently to 330 respondents. Post-interviews were also conducted with selected students to further comprehend the sociocultural context.

The findings suggest that exposing students to financial education and practices influence their financial literacy scores. Students who attended muamalat-related courses demonstrated better financial literacy scores. Meanwhile, post-interview results indicate that the students’ social environment and interactions also play important roles in enhancing their financial literacy. Hence, it is believed that it is essential to embed Islamic-based measurements to equip students with financial literacy in tandem with their pedagogic development. The results thus extend previous studies by confirming the importance of Islamic-based finance- and business-related knowledge for all tertiary students. Furthermore, the curricula should be made compatible to their studying environment and attuned to their values and cultures.

The findings suggest the introduction of personal financial and muamalat-based knowledge and practices relative to their Islamic programme orientation. This should take place during the students’ academic years and across all academic programmes’ orientation. The study also highlights the importance of developing special measurements of Islamic financial literacy for Muslims congruent to their distinct Islamic identity.

The study indicates the importance of high financial literacy among tertiary students for them to have a financially stable future.

The research is original in its use of several measurements of financial literacy that embedded Islamic teachings concomitant to the Muslim respondents.

The purpose of this paper is to empirically explore the financial well-being (FWB) of Malaysian households and to construct a subjective FWB index with present and future time perspectives.

Data were collected from 1,867 respondents across five major regions in Malaysia. Adapting the InCharge Financial Distress/Financial Well-being (IFDFW) Scale by Prawitz et al. (2006) and the method of computing an index by Devlin (2009), this study develops an FWB index using subjective measures that include future time perspectives (retirement). The index was employed to measure the FWB across low-, middle- and high-income groups and socio-demographic characteristics.

This study finds evidence that Malaysians' FWB is at an average level (46.8). Middle-income households' FWB (46.1) flanks between the financial well-being index (FWBI) levels of the low-income (37.4) and high-income households (58.7). Across age groups, education levels and employment sectors, the FWB of Malaysians significantly varies, although not across different ethnics, religions, zones and residential areas. Overall, the results suggest that the detrimental effects of FWB are perceived by all Malaysian households nationwide regardless of their religion, ethnicity and residential areas.

The results of this study complement the other well-being indices used by policymakers and may serve as a useful input for government and policymakers for them to formulate appropriate strategies to promote higher FWB of Malaysian households based on their socio-demographic characteristics.

This study used primary data and developed a subjective FWB index that leverages on people's perceptions of their own financial well-being while including present and future time perspectives. The main contribution of this paper is to construct an index that is easily interpretable and that complements the existing FWB indices, and to identify the segments of society that have low vis-à-vis high FWB.

Purpose – This chapter examines the application of the concept of maslahah in household debt management.

Methodology/approach – A combination of quantitative and qualitative approaches is employed. Questionnaires were used for data collection.

Findings – Malaysian Muslims become indebted for four main purposes: buying their first car, their first home, helping family members, and financing their studies. Thus, Muslims principally borrow funds to fulfil their dharuriyyat (essentials) and hajiyyat (complementary) needs, and in some cases, they borrow for tahsiniyyat (luxury) purposes.

Research limitation/implications – The respondents of this research are working Muslims in the Klang Valley, Kuala Lumpur, Malaysia.

Practical implication – This study helps Islamic finance institutions to develop better products to offer customers. Its results can also give a real picture about borrowing activities to the Credit Counselling and Debt Management Agency.

Originality/value – Prior studies have mainly examined household debt management. This study surveys local Muslims’ household borrowing pattern to understand the nature of personal debt management and then analyses these data against the concept of maslahah. This will enrich the currently available literature.

This study aims to examine whether the financial reporting practices of organisations managing waqf (Islamic endowed trust funds) are Sharia-compliant.

This paper reports on a case study of two Islamic-based organisations that manage waqf. The financial statements of these organisations are analysed using content analysis to assess their compliance with the Accounting and Auditing Organisation for Islamic Financial Institutions (AAOIFI) Sharia Standard No. 33 (SS 33) on waqf.

The authors found that both Islamic-based organisations use different sets of accounting procedures and practices, but that these accounting practices do not contradict the Sharia requirements prescribed in the SS 33 on waqf. However, the SS 33 on waqf requires that waqf funds to be utilised as stipulated by the waqif (donor) and that the accounting practices of both organisations do not adequately address this disclosure requirement. This study also found that the existing accounting practices adopted by organisations that manage waqf need to incorporate more disclosure on their Sharia-based financing and their investment of waqf funds.

This study found that the AAOIFI’s SS33 on waqf is a useful guide for identifying the gap between Sharia principles and conventional financial reporting practices for non-profit organisations, and that there are aspects of Sharia-based disclosure practices that are not adequately implemented in financial reporting practices of institutions managing waqf.

This study proposes two essential Sharia-based disclosure practices for Islamic-based organisations that manage Islamic-based funds such as waqf. These two aspects are the disclosure on whether waqf funds are adequately utilised as stipulated by the waqif (donor) and what modifications to their existing financial reporting of their Sharia-based financing and investments are required to comply with the unique nature of waqf.

This paper fulfils an identified need to study how Sharia principles can be incorporated into the financial reporting practices of organisations that manage Islamic-based funds such as waqf.

This paper aims to address the influence of mass media (MM) and word of mouth (WOM) on subjective norm (SN) and the intentions to purchase a family takaful scheme among Muslim Malaysians.

Data were collected from 384 Muslim consumers in Kuala Lumpur, Malaysia, using a convenience sampling approach. The hypotheses were tested by applying structural equation modelling.

The results revealed that MM and WM were able to influence SN. In addition, the results also found that SN significantly influences intentions to purchase a family takaful scheme.

By examining MM and WM on SN, the study validated the importance of both constructs in affecting consumers’ SN and purchase intention. This study would be useful for takaful operators, as the findings would help them to formulate strategies for promotional activities.

This paper empirically justifies the relationship between MM and WM on SN and purchase intention of family takaful schemes in an integrated model.

Muslim consumers’ tendency to patronize stores with Halal images and purchase genuine Halal products is closely related to their effort to maintain Islamic identity, and this is further supported by many empirical data. Therefore, this paper aims to examine the relationships between attitude, subjective norm, perceived behavioral control and Halal principle knowledge and their effect on Muslim consumers’ behavioral intention to patronize retail stores. On top of that, the mediating effect of Halal image on these relationships is also investigated.

Data were analyzed using multiple and hierarchical regression analysis to test the model via the Statistical Package for the Social Sciences (SPSS) software among 480 valid samples of Muslim consumers.

Empirical results of the hierarchical regression analysis and the Sobel test revealed that there is a significant mediating effect of Halal image on the relationship between consumers’ attitude, subjective norm and perceived behavioral control of consumers’ behavioral intention to patronize retail stores. Consumers with high attentiveness of the stores’ Halal image have a positive impression of the stores, a high motivation to patronize and, without any conditions, may follow through their intention to patronize the retail stores.

This research study offers guidelines to the retailers, marketers and the authorities in enhancing marketing strategies and the implementation of stricter Halal consumption laws. Hence, this research puts forward the following strategies: adopting Halal marketing strategy, promoting Halal images in retail stores and reinforcing Halal principle knowledge in the mind of consumers.

The main theoretical contribution relates to the insertion of the Halal image as a mediating variable in the matter of Muslim consumers’ behavioral intention to patronize Halal stores in Malaysia. An inspection of the effect of Halal principle knowledge on Muslim consumers’ behavioral intention to patronize retail stores is also rewarding.

This paper aims to improve the understanding of the institutional pressures that shape the intention to adopt waqf accounting and reporting. The study seeks to answer two research questions as follows: what are the challenges in the adoption of waqf accounting and reporting in waqf institutions; and how do institutional pressures influence the adoption of waqf reporting in Malaysia. Drawing on the work of DiMaggio and Powell and Scott of institutional theory, this paper provides empirical evidence of institutional pressures on the adoption of waqf reporting in Malaysia and the challenges faced in adopting waqf accounting and reporting.

This study uses qualitative research method with an explanatory case study approach. Data are collected through semi-structured interviews with the accountants of State Islamic Religious Council and Customs of Terengganu, an informal conversation with the Deputy Director of Accountant Generals Department of Malaysia and document reviews, mainly the Malaysian Accounting Standard Board Research paper.

The findings show that coercive pressure such as government regulation contributes to challenges in the adoption of waqf accounting and reporting. Normative pressures contribute to challenges in formulating standardised waqf accounting and reporting, whereas mimetic pressure contributes to challenges in the comparability of the waqf accounting and reporting among the state Islamic religious councils in Malaysia. In the efforts towards the standardisation of waqf accounting and reporting practice, a similarity of the process of the standard implementation or the institutional isomorphism of the State Islamic Religious Council in Terengganu is strongly influenced from the result of the mandate of its Board members and Fatwa council members (coercive isomorphism and religion logic) and minor influence from the normative isomorphism (the result of the participants’ education and profession) as well as the result of imitating other State of Islamic Religious Councils (SIRCs) because of the ambiguity of the process or certain practice.

The study contributes to the knowledge by extending institutional theory and the possible role of religion logic in Islamic perspective to organisational behaviour and accounting development in SIRCs. This study is limited to the understanding of the challenges in the adoption of waqf accounting and reporting but could also be applicable to the adoption of other accounting standards or regulations.

This paper offers key implications for research, in improving the understanding of contextual factors and decision to adopt waqf accounting and reporting. The standard setter needs to be aware of the influence of contextual factors that shape decision towards standardisation of accounting and reporting for waqf.

The interplay of institutional pressures and implications of religion logic provides an interesting approach to understanding the waqf institutions’ intention to adopt accounting and reporting for waqf.