ulators .
Accounting and financial management may undergo major changes. This would happen because Islam has different position on ownership, rules for transactions and the financial instruments. p align="justify"> Islamic banking will lead to better business ethics because banks will entertain only economically viable financing requests. Note that the said transformation shall take place even without prior moral uplift of the society for Islamic banking. Careful design of Islamic financial instruments will discourage unscrupulous behavior by fund-seekers. [15]
The Islamic Development Bank
The Islamic Development Bank, a specialized institution of the Organization of the Islamic Conference (OIC), is an international financing institution. Its purpose is to foster the economic development and social progress of Muslim countries and Muslim Communities in accordance with the principles of the Shari ah and to bridge the gap between rich and poor member-countries. IDB is the first international financial institution to commit itself to conduct its activities in conformity with the Shari ah. As a result, the prohibition of Riba in Islam and the implications thereof have motivated certain conceptual and operational features which distinguish the IDB from other international development banks and other institutions having similar purposes. The Bank is authorized to accept deposits and to mobilize financial resources only through Shari'ah compatible modes and is authorized to levy a service fee to cover its administrative expenses instead of working on the basis of interest. The major source of IDB s finance has been the capital subscriptions of its members. Repayment of existing lines of credit enabled to have additional funds to support the activities of the IDB after the initial capital injections. And as the bank is providing temporary assistance rather than making grants, the capital is revolving and replenishes itself. of the strategic objectives of IDB is to improve and enhance the level of intra trade among its member countries from the developing world. Therefore, the bank assists in the promotion of foreign trade among Muslim countries, by providing financial assistance to member countries and Muslim communities in non-member countries and by developing human capital. IDB also acts as a catalyst in these intra trade activities by participating in equity capital through investment in economic and social infrastructure projects and by granting loans for productive projects in the private and public sectors. Equity-financing and profit-sharing functions are the primary modes of operational financing and loan-financing adopted by the IDB. , One of IDB s missions is to undertake research to enable the economic, financial and ...
