Matrix Sampling Dan Jurnalnya

Nama : Resita Is
Nim : 1501103010017
Tugas : Metodologi Penelitian
No Author Title Year Population Sample Method

1 Zurina Shafiia, Shariah audit in 2014 Two local In total, only 351 This study used both purposive
Nor Aishah Mohd Islamic banks: an universities in questionnaires out as well as convenience
Alib and Nawal insight to the Mallaysia, Final Year of 380 sampling where the
Kasimc* future shariah student at University questionnaires questionnaire were distributed
auditor labour A (Uni A) distributed will be by hand and based on
market in Those final year considered valid, voluntary participation to a
Malaysia students who learnt resulting a 90.25% group of students within the
*jurnal berasal shariah auditing as which is considered researcher working area.
dari ScienceDirect part of their course very high and valid
Procedia - Social syllabus. for a simple
and Behavioral statistical analysis.
Sciences 145 ( and Final Year Out of 351
2014 ) 158 – 172 Student at University questionnaires
B (Uni B) collected, 164 were
Those final year collected from
students who learnt Bachelor of
only conventional Accounting
auditing course students
offered by a local from University A
university and 187
questionnaires
collected from
students from
University B.
2 Yazilmiwati Entrepreneur’s 2012 Most successful A field study was in this study used cluster
Yaacoba* Social entrepreneurs in conducted on 183 sampling technique because
Ilhaamie Abdul Responsibilities Malaysia Muslim the data used here is data that
Ghani Azmib From Islamic entrepreneurs in has been grouped the best
Perspective: A Malaysia. group of entrepreneurs in
Study Of Muslim malaysia
Entrepreneurs In Respondents in this
Malaysia study consisted of
130 males and 53
females.
3 Imam Bucharia, Awareness and 2015 The respondents are A total of 150 A disproportionate stratified
Ahmad Rafikib , attitudes of the employees from questionnaires are random sampling is used in
Mahmood employees five Islamic retail distributed through this study.
Abdullah Hadi Al towards islamic banks in Bahrain. an electronic
Qassabc banking products survey system,
in Bahrain however, 102
respondents are
*jurnal di dapat well-responded.
dari Sciendirect,
Procedia
Economics and
Finance 30 (
2015 ) 68 – 78
Available online at www.sciencedirect.com
ScienceDirect
Procedia Economics and Finance 30 (2015) 68 – 78
3rd Economics & Finance Conference, Rome, Italy, April 14-17, 2015 and 4th Economics &
Finance Conference, London, UK, August 25-28, 2015
Awareness and attitudes of employees towards islamic banking

products in Bahrain
Imam Buchari a, Ahmad Rafiki b, Mahmood Abdullah Hadi Al Qassabc
a
Faculty of Business Administration, University College of Bahrain, Bahrain
b
International Investment Bank, 37th Floor, Almoayyed Tower Al Seef District P.O. Box 11616, Manama, Bahrain
Abstract
This study aims to analyze the employees’ awareness and attitudes towards the Islamic banking products. Each of the contructs;
awareness and attitude are derived from theories and previous researches. Based on the descriptive analysis of 102 responded
questionnaires from employees who are currently working in five Islamic retail banks in Bahrain, the study concluded that 56% of
respondents are aware as well as have a positive attitude towards Islamic banking products and services. It also found that there
are statistically significant differences in the awareness and attitudes towards Islamic banks’ products and services when they are
grouped according to gender and education level while age and income both have insignificant differences. The findings invariably
convey the standard of employees’ awareness and attitude towards the Islamic banking products and services in Bahrain. This
information will be useful for further evaluating and benchmarking the competitiveness of employees in Islamic Banking and
Financial Institutions.
© 2015 The Authors. Published by Elsevier B.V.
© 2015 The Authors. Published by Elsevier B.V. This is an open access article under the CC BY-NC-ND license
Peer-review under responsibility of IISES-International Institute for Social and Economics Sciences.
(http://creativecommons.org/licenses/by-nc-nd/4.0/).
Keywords: Awareness; Attitudes; Employees; Islamic Banking Products
Introduction
Understanding the assessment and evaluation of Islamic banking products is vitally crucial to the Islamic Banks’
employees. The employees must be the first who are fully aware of the goodness of the products and have highly
positive attitude to ensure those products are acceptable by the customers. This could be a significant contribution to
the development of Islamic banks in particular and other Islamic Financial Institutions as the employees know what
they promote and sell to their customers.
The employees of Islamic banks will be able to convince the customers by having full knowledge about the products
and its benefits. As it is been conformed that all principles of Islamic Banking and Finance strictly adhered to Al-
2212-5671 © 2015 The Authors. Published by Elsevier B.V. This is an open access article under the CC BY-NC-ND license
doi:10.1016/S2212-5671(15)01256-3
Imam Buchari et al. / Procedia Economics and Finance 30 (2015) 68 – 78 69
Qur’an* and Sunnah† should be acknowledged, comprehensively understood and practicable. This what really makes
employees who are working in the Islamic-based Financial institutions are different. The possesion of knowledge and
experience of the employees is used as the vital resources for the companies to continuously achieve better
performance and growth thus their awareness and attitudes become the pivotal elements.
Islamic banking industry is the fastest growing segment in the world banking system whereby its market share in
total assets has risen from 2% in the late 1970s to 15% up to mid 1990s (Wilson, 2009). Since 1971, Islamic banks
have grown even larger in size as well as in numbers. In the last twenty years, it experienced actual emergence of
Islamic banking being feasible banking system. Admittedly, the leading vision of these banks continues to improve
the social welfare and financial development through the delivery of financial products and services using the
principles and teachings of Islam. To realize their own mission, it is essential for Islamic banks to continously study
how to enhance behavior, attitude and awareness of their clientele mainly of retail segment which usually constitutes
as the main aspect of banking business (Metawa & Almossawi, 1998).
Eventually, previous studies have only demonstrated and investigated the level of awareness, attitudes and
understanding of conventional banking customers. There have been insufficient studies done in assessing the level of
employees’ awareness and attitudes among Islamic banks, thus the study aims to analyze the aforementioned gap.
Literature Review
Islamic Banks in Bahrain
Essentially, Bahrain is the most developed country in term of Islamic finance structure within the Gulf Cooperation
Council (GCC) countries. This country truly promotes and positions itself as a global hub for Islamic finance. To
achieve this unique objective, the Central Bank of Bahrain (CBB), through its comprehensive regulatory platform,
opens up its gateway towards local and international Islamic financial institutions to operate within the country
(Wilson, 2009).
Bahrain's banking sector has remained as a cornerstone for the country’s economic development. The entire banking
sector represents more than 85% of overall financial assets. In addition, the dual banking system of Bahrain comprises
both of conventional and Islamic-based banks. The conventional banking sector consists of retails, specialized,
wholesale and consultant offices of international banks. Additionally, the Islamic sector includes retail and wholesale
banks that provide a variety of Shariah (Islamic Law) compliant products and services. The numerous Islamic financial
institutions in the country demonstrated as the leading Islamic financial center in the region. In the year 2011, the
Islamic banks’ share is around 12% of Bahrain's banking sector (Wilson, 2009).
Many experts and authorities of Islamic banks have even stated that Islamic banks are generally not really or less
impacted by the global financial crisis compared to conventional counterparts as a result of salient features and
characteristics of Islamic banking where all financial transactions must be trade-based, asset-backed and equity-based
financing.
The Islamic Financial Products of Islamic Banks in Bahrain
Islamic banks in Bahrain present a large amount of product offerings and services. According to CBB statistical
bulletin report in December 2013, Murabaha accounts amounted US$3.9 billion represented 49% of Restricted and
UnRestricted accounts (RUR) for Islamic banks, generally this type of financing is proven to be extremely financially-
rewarding yet significantly less risky, followed with Ijara (lease) that has US$1.0 billion accounts represented 13% of
*
It is primary source of divine law in Islam and Muslims’ Holy book
†
Other source of legal rulings in Islam from which all that is narrated from the prophet Muhammad, his acts, his sayings, his physical attributes
and character
70 Imam Buchari et al. / Procedia Economics and Finance 30 (2015) 68 – 78
the RUR. The unconsolidated subsidiaries and associates presented as the largest share in the RUR, as it amounted to
US$3 billion of the total RUR. Mudaraba and Musharaka contracts indicated a share of 0.6% and 0.1%,
correspondingly. A creative fund sourcing and mobilizing components of the Islamic banks showed in its profit-loss
(risk-sharing) model that mostly depending on Mudarabah (profit sharing) and Musharakah (partnership) as Islamic
nominated contracts. These clearly show that Islamic banks aim to introduce financial products offerings in line with
the Shariah law. This explanation and analysis had been prepared by Dar and Presley (2000) and Chong and Liu
(2007). Additionally, it is worth-noted that the total banks assets in Bahrain had reached at US$ 191.2 billion by the
end of 2013. The proportion of Islamic banking institutions in the banking assets was US$23.3 billion, which
represents 8.2 percent of the total banking assets.
The Awareness of Islamic Banking Concept
Awareness of the Islamic banking products and services refers to the understanding and acknowledgement of the
existing tradable items, the content of products/services as well as the functions. The knowledge of these are acquired
by having in touch with the products and services directly or hearing from other sources on it. Beside the growing
development of Islamic banking in all over the worlds particularly in Bahrain, the awareness employees who work at
those banks are not rigorously evaluated and assessed.
A study conducted by Ramdhony (2013) in Mauritius on the customers’ awareness of Islamic banking terminology
and their views of Islamic banking products. It found that 82% of respondents have awareness while 14% are not
aware of Islamic banking products. This study also highlighted a significant relationship between public awareness
and religion. The more pious people, the greater chance of getting familiar with the Islamic banking products.
Technically, those respondents have ranked their understanding on Islamic banking products/terms as follows; (i) Riba
(27.2%); Shariah (33.6%); Mudharabah (19.8%); Musharakah (19.8%); Sukuk (16.4%); Takaful (28.4%); Murabaha
(18.1%) and Ijarah (22.8%). Moreover, 66% of the respondents mentioned that the religious beliefs only motivate
people to deal with Islamic banks. It also found that majority of respondents by 84% opined exclusively and had better
impression on Islamic bank’s return. While on the investment choice, 50% of the respondents unexpectedly
acknowledged to deposit large amount of money in Islamic banks.
Another study by Omer (1992) of 300 Muslims in the United Kingdom about their patronage aspects and awareness
of Islamic financing methods. It found that the Shariah-compliant products appeared to be effectively accessible
through Islamic finance “windows” of conventional banks. It also revealed that the lack of education become a main
reason among Muslims in the United Kingdom to understand the Islamic finance concepts. That is certainly consistent
with other findings and literatures that Muslims living in Non-Muslim country develop a significant awareness and
knowledge of Islamic banking as compared to immigrant Muslims. Although many Muslims in United Kingdom
seemed to understand the Islamic financing, the religious commitment remains as the paramount element of
patronizing the Islamic banking services.
Akhtar and Akhter (2011) conducted a survey on employees in Islamic banks’ in India and found various
understanding level of awareness of the Islamic banking products. While, Okumus (2005) found that the customer‘s
awareness of Islamic banking products in Pakistan and Turkey are perfectly astonishing in some of the products such
as current and time deposit accounts. However, a number of the Islamic financial products such as Murabaha and
Ijara, are often not aware among the customers. While Awan (2011) ascertained the customer awareness of the Islamic
banking products and services through its accessibility and customer satisfaction is high either at the fully-fledged
Islamic banks or dual-window banks operating in Pakistan. Another findings revealed that the customers are less focus
to religious belief in banks’ selection process. Eventually, the products’ concepts and excellence of services are the
less significant factors in selecting Islamic banks.
In Malaysia, Nordin (2001) studied the awareness of Islamic banking system among 45 business enterprises and
customers. It found a lower rate of using Islamic banking products and understanding of Islamic financial system
particularly concerning the aspect of profit-sharing concept. All participants began utilizing Islamic banking services
in less than 5 years ago, despite the fact of its emergence over 15 years.
A study of understanding Islamic banking products among the customers and employees of the Islamic banks in
Malaysia by Norafifah (2000) found that the respondents were not interested in having banking transactions in Islamic
banks because they believed that only the name of the banks had been changed to reflect that it was an Islamic-based
bank whereby the interest, which is prohibited in Islam, was still practiced. Overall, the researchers determined that
customers and employees understanding the concepts and practices of Islamic banking are still vague. The authors
recommended that to prevent any misunderstanding this concept, adequate training must be given to the employees.
While, Rammal (2007) posited that some participants who had believed in a Halal‡ banking product cannot be found
even not aware of the profit and loss sharing concept. This reveals that they do not acknowledge a fair and better
concept which brings reasonable profits.
The Attitudes Towards Islamic Banking Concept
Allport (1935) defined an attitude as a mental or neural state of readiness, organized through experience, exerting
a directive or dynamic influence on the individual’s response to all objects and situations to which it is related. In a
simple definition of attitude is a mindset to act in a particular manner due to both an individual’s experience and
knowledge.
In Bahrain, Metawa and Almossawi (1998) determined that the paramount aspect in identifying the attitudes of
Islamic banks’ clients was religious beliefs than profitability. Additionally, the majority of Bahraini bank consumers
were pleased with the standard of Islamic bank services, especially the investment accounts. They found that the
essential aspect appeared to be incentive expanded by the banks, accompanied by influence of best friends and family,
and location. Their research also pointed out that socio-demographic elements including age category, income level
and learning level were considered as the important factors on concepts’ selections. While, the findings on discovering
religious belief as the most significant reason contradict with the analysis conducted by Haron (2002).
There were studies which examined the customers and employees’ attitudes towards Islamic banking products,
among others are Lee (2009); Jalaluddin (1999); Abdullah and Abdul Rahman (2007); Gait (2008). Lee (2009)
concluded that the main factor attracting Muslims attitudes towards Islamic Banking is the religious belief, followed
by goodness of products and services. Meanwhile, Jalaluddin (1999) examined the attitudes of 385 business enterprise
firms towards the profit-loss sharing approach of finance in Australia. It found that the intention as a result of having
an interest towards profit-loss sharing method is derived based on business support, a higher level of risk sharing
between financiers and financees, risk default of the traditional system as well as interest rates, the profitability
linkages and desired rate of return.
The literature on attitudes, perceptions and knowledge of Islamic financial products and services in comparison
with those conventional banks empirically had been analyzed extensively by Gaith (2008). Based on their review of
the relevant literature, they found that religious conviction was a key factor in the use of Islamic products and services.
The consumers also identified that bank reputation, service quality and pricing as being relevance to this matter.
Moreover, they determined the predisposition to Islamic finance methods as subsumed to a complete characteristic of
choosing conventional bank. However, in their survey in 2009 on 296 Libyan business firms on attitudes towards
Islamic finance indicated that 72.3% of the Libyan business firms are interested to employ Islamic finance. The
inspiring factors for business firms to essentially use the Islamic finance are religious beliefs, after that productivity,
business support as well as services.
Meanwhile, Abdullah and Abdul Rahman (2007) who did a study on Muslim businessmen in Malaysia discover
that 80% of the respondents conformed that an intention to use Islamic financing is a consequence of religious beliefs
commitment aligned with Shariah-based approach. Other essential elements appeared are the capital guarantee and
revenue. While, 58% of the users of Islamic financing are encouraged to use Islamic financing due to the awareness
that Islamic finance brings proper rights to people and more profitable as compared to conventional financing.
‡
Permissible in Islam
However, according the non-customers of Islamic financing, they believed that Islamic finance and conventional
products are usually have no significant difference, while Islamic financing is considered more expensive than
conventional financing.
Hypotheses of the Study
H1 : There is a significant difference of gender towards the awareness and attitudes towards Islamic Banking
products and services.
H2 : There is a significant difference of age towards the awareness and attitudes towards Islamic Banks products
and services.
H3 : There is a significant difference of education level towards the awareness and attitudes towards Islamic
Banking products and services
H4 : There is a significant difference of income towards the awareness and attitudes towards Islamic Banking
products and services.
Methodology
Research Design
This study uses a quantitative method to identify trends or discover explanations for relationships among variables
(Creswell, 2002). Both descriptive and inferential analysis are adopted to assess the demographic and independent
variables. The instruments designed in nominal and interval scale where the average of respective three and five
responses are calculated. Internal consistency of the scales is tested by using the Cronbach’s alpha coefficient
(Cronbach, 1951). To test the effect of demographic variables, the Pearson correlation coefficients is used to indicate
normality and linearity (Bryman & Cramer, 2001) and while a series of two-tailed independent group t-tests and one-
way between groups ANOVA are conducted.
Sample Frame
A disproportionate stratified random sampling is used in this study. The respondents are the employees from five
Islamic retail banks in Bahrain. A total of 150 questionnaires are distributed through an electronic survey system,
however, 102 respondents are well-responded. The chosen banks were selected based on their tenure of operations in
the country, size, local presence and international network exposure.
Findings and Discussion
Descriptive Analysis
Frequency of Demographic Profile
The demographic profile consists of age, religion, education level, occupation and monthly income level etc. Out
of 102 respondents, there are 47 male and 55 females whereby 37 (36.3%) of them are in range between 20 to 30 years
old, while 7 (6.9%) of the respondents are in age of 60 and above. For the education level, 22 and 32 of the respondents
are having diploma and under graduate degree respectively. The bachelor degree has the highest frequency by 48
(46.8%) the respondents. While for the occupation, the respondents who are working in business/financial and
accounting fields have the most frequency by 24 (10.7%) and 25 (8.9%) respectively. 58 (50.7%) of the respondents
earned their monthly income level between BD 1001-2500. This because most of them are in the middle level of carrier
and age. While, 16 (26.8%) respondents received less than BD 1000 monthly income, and 28 (18.9%) respondents
received above BD 2001. Majority of the respondents have long relationships with Islamic banking system which is
40.2% for 6 to 15 years, while 28.4% prefer to deal with credit card as the main selection of Islamic bank’s system.
Results of Awareness and Attitudes
As found in descriptive data analysis, it shows the responses of 102 respondents on the awareness of Islamic
banking products and services in Bahrain. Below are the highlighted responses:
1. 67.65% of the respondents agree that Islamic banking products are based on mutually benefit- contract.
2. 54.90% of the respondents agree that Islamic banking products are well known locally and globally.
3. 56.86% of the respondents agree to switch from conventional banks to Islamic banks
4. 49.02% of the respondents agree that Islamic banks operate according to Shariah law.
5. 58.82% of the respondents agree that Islamic banking products are mainly offered to Muslims.
6. 51.96% of the respondents agree that the Islamic banking products are based on risk-sharing model
7. 45.10% of the respondents agree that the Islamic Bank advertisements are not misleading
8. 47.06% of the respondents agree that Islamic banking products available in Bahrain are not similar to
conventional banks products
9. 78.43% of the respondents agree that Islamic banking products backed with assets has positive impact on the
financial systems
10. 56.86% of the respondents agree that the Islamic banking products are available for non-Muslims
11. 51.96% of the respondents agree that the Islamic banking products prohibit exploitative interest
12. 55.88% of the respondents agree that the contracting parties predetermine profit-sharing ratio
13. 50.98% of the respondents agree that returns are based on gift and profit-sharing basis
14. 59.80% of the respondents agree that Islamic banking products prohibit major uncertainties
15. 60.78% of the respondents agree that the Islamic Banks invests only in Halal business
Furthermore, it shows the responses of 102 respondents on the attitudes towards Islamic banking product and
services in Bahrain. Below are the highlighted responses:
1. 81.37% of the respondents agree that financing based on profit-loss sharing is beneficial
2. 52.94% of the respondents agree that financial-related matters and religion is inseparable
3. 59.80% of the respondents agree that the Islamic Banking provides better solution to contemporary financial
problems
4. 56.86% of the respondents agree that the Islamic banking is at par with the principles of modern finance
5. 51.96% of the respondents agree that the investments are secured in Islamic Banks
6. 52.94% of the respondents agree that the Islamic bank’s goal is not only to maximize shareholders’ wealth
but also enhance standard of living and welfare of society
7. 54.90% of the respondents agree that people become more ethical when they associate with Islamic Banks
8. 37.25% of the respondents agree that Islamic banks deal more fairness with customers than conventional
banks
9. 44.12% of the respondents agree that the information on certain Islamic banking products is sufficient and
easily understood
10. 54.90% of the respondents agree that the Islamic banks offer product which attract customers more than
conventional banks
11. 55.88% of the respondents agree that the benefit of Islamic banking products are inevitable
12. 48.04% of the respondents agree that the Islamic banking products are uniquely featured
The Summary of Average Weighted Mean
Gender. The average weighted means obtained from the respondents’ awareness and attitudes towards Islamic
banking products when grouped according to gender range are; Male (3.30) and Female (3.44) where both have a
verbal interpretation of “neutral”.
Age. The average weighted means obtained from the respondents’ awareness and attitudes towards Islamic banking
products when grouped according to age range are; 20-30 years (3.37); 31 – 40 years (3.26); 41 – 50 years (3.42); and
51 – 60 years (3.26) where all of them have a verbal interpretation of “neutral”. This finding indicates that respondents
whose age ranges in between 20-30 years are more aware of Islamic banking products than other age groups. One
possible explanation is due to their exposure to towards Islamic banking products in their universities or training
institute.
Education. The average weighted mean received by all items of the respondents with diploma degree is 3.34;
undergraduate degree is 3.46; and graduate degree is 3.34 with all of them have a verbal interpretation of “neutral”.
This result indicates that respondents with undergraduate degree are more aware than other groups and highly positive
attitudes towards Islamic banking products. One of the possible explanations is due to the introduction of Islamic
banking products courses in under graduate programs.
Income. The average weighted mean received with an income from BD §3000 and above is 2.49 with a verbal
interpretation of “disagree”, while the remaining income range of BD less 500 (3.53); BD 501 – 1000 (3.51); BD 1001
– 1500 (3.41); BD 1501 – 2000 (3.49); BD 2001 – 2500 (3.27); and BD 2501 – 3000 (3.32) have a verbal interpretation
of “neutral”. The results indicate that those respondents with income BD 1501 - 2000 are more aware of Islamic
banking products than others. This might be due to the fact that as middle income level has the intention to participate
in Islamic banking scheme.
Instruments’ Scales Reliability and Validity
The reliability concerns with the robustness of the questionnaires and whether it will produce consistent findings at
different times and under different conditions. This reliability test is assessed by the Cronbach‘s Alpha values. As
depicted in Table 1, the internal reliability test for the two constucts are higher than 0.70, hence the results are reliable.
Meanwhile, Pearson correlation coefficients is indicating normality and linearity (Bryman and Cramer, 2001).
Pearson's r ranges from -1.0 to 1.0 measure the strength of linear relationship. As depicted in Table 2, it shows that
the awareness and attitude towards Islamic banks’ product and services have a positive correlation of 0.477 which
indicate the variables are significantly correlated with another variable.
Table 1. Internal Reliability Test
Construct No. of Items Cronbach‘s Alpha

Awareness of Islamic Banks’ Product And Services 15 0.799
Attitude towards Islamic Banks’ Products and Services 12 0.811
Table 2. Pearson Correlation
Awareness of Islamic Attitude towards

Banks’ Product and Islamic Banks’ Products
Services and Services
§
Bahrain Dinnars
Awareness on Islamic Banks’ Pearson

1 .477**
Products and Services Correlation
Attitude on Islamic Banks’ Pearson
.477** 1
Products and Services Correlation
**. Correlation is significant at the 0.01 level (2-tailed).
Inferential Analysis
The inferential analysis of this study consists of t-test and Kruskal-Wallis test - ANOVA. An independent-samples
t-test will tell you whether there is a statistically significant difference in the mean scores for the two groups, while
One-way ANOVA tells whether there are significant differences in the mean scores on the dependent variable across
the three groups.
T-Test
Table 3. T-Test
Group Statistics
Gender N Mean Std. Deviation Std. Error Mean
Score Male 47 106.7660 15.74969 2.29733
Female 55 110.0909 11.21387 1.51208
Table 4. Independent Samples Test
Levene's Test for

Equality of t-test for Equality of Means
Variances
95% Confidence Interval of
Sig. (2- Mean Std. Error the Difference
Sig.
tailed) Difference Difference
Lower Upper
Equal variances
.021 .218 -3.32495 2.67989 -8.64178 1.99188
assumed
Equal variances
.230 -3.32495 2.75029 -8.79669 2.14679
not assumed
Based on the T Test results shown in Table 4, it was found that the female respondents have better awareness and
attitudes towards Islamic Banks’ products and services than male respondents yet the differences are statistically
significant since the p-value is below 5%. Thus, the H1 is accepted.
Kruskal-Wallis Test – One Way Analysis of Variance
A Kruskal-Wallis test was used to determine whether or not significant differences exist in the average weighted
means obtained by the responses of the respondents when grouped according to age, education level, and income.
Table 5. Kruskal-Wallis Test

AGE N Mean Rank

Scores 20-30 yrs 37 60.05
31-40 yrs 33 43.44
41-50 yrs 25 53.78
51-60 yrs 7 36.14
Total 102
Test Statistics a,b
Scores
Chi-Square 7.586
Df 3
Asymp. Sig. .081
a. Kruskal Wallis Test
b. Grouping Variable: AGE
Based on the results shown in Table 5, it was found that when the respondents are grouped based on their age, the
respondents from 20 to 30 years old have better awareness and attitudes towards Islamic Banking Products, followed
by the respondents from 41 to 50 years, then the respondents from 31 to 40 years old and the respondents from 51 to
60 years old have the lowest awareness and attitudes towards Islamic banking products and services but the differences
are not statistically significant since the p-value is above 5%. Thus, the H2 is rejected.
Education N Mean Rank

Score Diploma 22 46.98
Undergraduate Degree 32 56.78
Graduate Degree 48 50.05
Total 102
Test Statistics a,b

Score
Chi-Square 1.651
Df 2
Asymp. Sig. .043
b. Grouping Variable: Education
Based on the test results shown in Table 6, it was found that when the respondents are grouped based on their
educational background, the respondents with undergraduate have better awareness and attitudes towards Islamic
Banking Products, followed by the respondents with graduate degree, then the respondents with diploma degree have
the lowest awareness and attitudes towards Islamic Banks’ products and services and the differences are statistically
significant since the p-value is below 5%, thus, the H3 is accepted. It also indicates that education plays significant
role in influencing the awareness.

INCOME N Mean Rank
Score <=500 BHD 5 67.30
501-1000 BHD 11 50.27
1001- 1500 BHD 20 53.53
1501 – 2000 BHD 17 58.44
2001 - 2500 BHD 21 49.69
2501 – 3000 BHD 13 46.23
> 3000 BHD 15 43.67
Total 102
Test Statistics a,b

Score
Chi-Square 4.021
Df 6
Asymp. Sig. .674
b. Grouping Variable: INCOME
Based on the test results shown in Table 7, it was found that when the respondents are grouped based on their
income earned, the respondents with an income from BD 500 and below have better awareness and attitudes towards
Islamic Banks’ products and services, followed by the respondents with an income from BD1501 to BD2000, then the
respondents with an income from BD1001 to BD1500, then the respondents with an income from BD501 to BD1000,
then the respondents with an income from BD2001 to BD2500, then the respondents with an income from BD2501 to
BD3000 and the respondents with an income from BD3000 and above have the lowest awareness and attitudes towards
Islamic Banks’ products and services and the differences are not statistically significant since the p-value is above 5%.
Thus, the H4 is rejected
CONCLUSION
Employees’ awareness of Islamic Banking products and services shows that most of the respondents believe that
Islamic banks’ products and services are unique and have a sense of dealing with others. In addition, they believe that
Islamic banking laws are derived from the Holy Quran and Sunnah. This concludes that more than 56% of respondents
are aware of the the Islamic banks products. Meanwhile, majority of the respondents have positive attitudes towards
Islamic banking products and services. Statistically, it is also found that there are significant differences to gender and
education level against the awareness and attitudes towards Islamic banking products and services while age and
income both have insignificant differences.
The findings of the research convey the standard of employees’ awareness and attitude towards the Islamic banking
products and services in Bahrain. This information will be useful for evaluation and benchmarking the competitiveness
of employees. Some strategies may be considered to increase and promote awareness by holding the workshops related
to marketing strategies on the products offered by the Islamic banks. The banking institutions also would find some
ways to educate their employees about the Islamic terms and conditions throughly.
Meanwhile, this study consists few limitations such as; (i) skewness of population that limit to the employees of
the selected banks, thus the final result may not represent the population in this sector; (ii) various backgrounds of
respondents may result in variety of people’s awareness who are working in other career fields because level of
awareness will have significant relationship with their occupation and income level. The forthcoming researchers
could perhaps add other variables of assessing the awareness and attitudes of employees, while covering many numbers
of banks as the sample of the study should be taken into account.
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Procedia - Social and Behavioral Sciences 58 (2012) 1131 – 1138
8th International Strategic Management Conference
Of Muslim Entrepreneurs In Malaysia
Yazilmiwati Yaacoba* Ilhaamie Abdul Ghani Azmib

a
MOHE- Compulsory Subject Unit, Sunway College, No 5, Jalan University,46150 Petaling Jaya Selangor
b
Syariah and Management, Academy of Islamic Studies University Malaya Kuala Lumpur Malaysia
Abstract
The success of an entrepreneur from an Islamic perspective is not only measured in terms of material success. This is because
human needs are not subjected just to the property they own, but encompasses all aspects required by the maqasid al-Shariah -
namely religion, intelligence, life, honor as well as physical property. Therefore, an assessment of whether the entrepreneur
succeeds or fail is based on the concept of maqasid al-Shariah. This study aims to examine the social responsibility of a Muslim
entrepreneur in Malaysia in fulfilling maqasid al-Shariah aspects with regards to their responsibilities to family members, the poor
as well as their responsibility towards the Muslim community by providing employment opportunities to society, doing business in
accordance with Islamic law and create an economic system based on This study will focus on the relationship
between the achievement of Muslim entrepreneurs in Malaysia and their social responsibility by using Pea
The study found a significant relationship between the achievement of Muslim entrepreneurs in Malaysia with social responsibility
undertaken by them.
© 2012 Published by Elsevier Ltd. Selection and/or peer-review under responsibility of the 8th International Strategic
2012 Published
Management by Elsevier
Conference Ltd. Selection
Open access and/or peer-review
under CC BY-NC-ND license. under responsibility of 8th International Strategic
Management Conference
Keywords: Muslim Entrepreneur, Maqasid al-Shariah, Social responsibilities, Success factor, Achievement
1. Introduction
eith Davis (1975) and Robert L.

Bloomstrom (2002), social responsibility is a mean to increase social welfare. Stephen P Robbins (2002) and Rusinal
(1999) view social responsibility as an obligation of a business firm to achieve its long-term goal, and have a positive
impact on society as a whole, while at the same time reducing the negative impact on them. Keith Davis and (1979)
Robert L. Bloomstrom (2002) considers the scope of responsibility to include the whole community and not just
*
PHD Student in Syariah and Management , Academy of Islamic Studies, University of Malaya & Senior Lecturer at MOHE-
1877-0428 © 2012 Published by Elsevier Ltd. Selection and/or peer-review under responsibility of the 8th International Strategic Management Conference
Open access under CC BY-NC-ND license. doi:10.1016/j.sbspro.2012.09.1094
1132 Yazilmiwati Yaacob and Ilhaamie Abdul Ghani Azmi / Procedia - Social and Behavioral Sciences 58 (2012) 1131 – 1138
narrowed down to certain parties only. Its role is to improve the livelihood and yet preserve all their interests. This will
result in a better quality of life whilst harmonizing the activities of the organization in line with the society.
From the Islamic perspective, social responsibility is very much similar to the takaful concept that emphasizes on the
intended to fulfill the maqasid al-Shari'ah mandates of religion, intelligence, life, honor and dignity as well as
property. The term takaful as written by Muhammad Jamaluddin Mahmud (1992) states that takaful is providing
sincere assistance from the rich to the poor, from of a cluster of strong to weak groups, from people who have
society. Furthermore, in Islam, takaful is about implementing the teachings found in the allocation of the Quran or the
hadith without expecting anything in return. Apart from the Islamic perspective, a Muslim should fulfill the five basic
elements known as maqasid al-Shariah. Based on the requirements mentioned, Islamic
responsibility is to realize the needs of the community in terms of religion, intelligence, life, honor and dignity as well
as property (Hailani Muji Tahir:2000).
According to Abdul Rahman Rosbi (2010), social responsibilities towards Islam includes being obligated to pay
Zakat, helping the less fortunate and doing business in accordance with Islamic law; whilst social responsibilities of
the mind is the need to love - they will only have a healthy mind and senses if they are to interact with family
members and the community. Without common sense, an entrepreneur will not be able to conduct their business
wisely, but instead encourage them to revert to violence, terrorism. These loss of respect and love ultimately defers
them from fulfilling their social responsibility. Social responsibility towards their own life, on the other hand is to
satisfy the needs and safety of self, family and society based on Islamic economic system. An entrepreneur need to
realize that all these responsibilities are for the welfare of all and does nothing that would jeopardize himself and
society. Social responsibility of an entrepreneur to maintain his dignity respect would then be reflected if the dignity
bilities
would then enable them to honor themselves and be recognized by family and society. The social responsibility
towards his wealth is via alms giving and charity donations to ensure that the work he have done in the field of
entrepreneurship will be blessed by Allah SWT. Based on the implementation of social entrepreneurs, this study will
focus on social responsibility conducted by successful entrepreneurs in Malaysia. This research should be discussed in
responsibilities are one of many practical steps for the entrepreneurs who
are involved in the business field in order to plan a strategic management system in their own business. The focus on
social responsibilities will not only impact positively towards the growth of the
economy, but also to the growth of the society as a whole. This research is expected to be able to contribute something
positively to the academicians, participants and those who are involved in the strategic management of the
organization.
2. Literature Review and Hypotheses
Corporate Social Responsibility (CSR) is a corporate commitment to improve the welfare of the community through
its business practices and contributions that can be given back to the community. CSR means the responsible to take
into account the interests of clients, employees, shareholders, stakeholders, communities and ecological considerations
in all of it business aspects. In addition, the social responsibility to society refers to the involvement of entrepreneurs
in contributing their time, money and ideas for community. Social responsibility should be carried out voluntarily. In
Islam, the exercise of social responsibility is encouraged - :-
We divide between them the essentials of their lives in this world (Some of us were made rich, some of
us were made poor and suffers: And we also raise half of the highest rank of the other half. (Made) so
that the those with part of the facility they
blessing (the way of life and the Hereafter) is better than the any materialistic that they merely
collect.(Surah Az-Zukhuf:32)
The above verse explains the importance of social responsibilities to those in need. According to Philip Nacy Cotler
and Lee (2005), most successful entrepreneurs in the west such as Andrew Carnegie and Bill Gates have carried out
their social responsibility to the community by donating most of their assets to charitable organizations and those in
need. Some western companies even have their own foundation to do charity works, and as such will increase their
reputation with its main shareholders. According to Philip and Lee (2005), a report from an investment company in
Yazilmiwati Yaacob and Ilhaamie Abdul Ghani Azmi / Procedia - Social and Behavioral Sciences 58 (2012) 1131 – 1138 1133
the west revealed that investments that emphasizes social responsibility has grown from $40 million in 1984 to $3
trillion in 2007. The study also demonstrates that the company that performs social responsibility has more
profitability, improved sales, while its market value and stock price is higher and better than companies that do not
have such policies and structures. Compared with companies that do not carry out social responsibility, research in the
west also proved that companies that do not carry out social responsibility are failed and non-expanding companies.
Among the social responsibilities that must be executed by Muslim entrepreneurs are as follows.
2.1 Fulfilling the needs of family and the weak
A Muslim entrepreneur have the responsibility to feed the family and help the weak, such as orphans and handicapped
-
And ye shall serve God and shall not associate him with something. And ye shall do your earnest good
to parents, close family, orphans, the poor, neighbor noth near and far. For Allah loves not those who
are arrogants with his words. (an-
The above verse shows us that an entrepreneur is responsible for his family members. The obligation is apparent in the
form of food, beverages, clothing and shelter for his wife and his children according to his capability. Holy Prophet
SAW quoted :-
Dear Prophet, Abu Sufyan is surely a very stingy man. He did not provide adequate maintenance for
me and my children except what I take from it and he did not know. Prophet said, "Take (from the
husband) what is sufficient for you and your children needs in kindness (good and polite)". (Sahih
Bukhari)
The obligation to provide for the family needs to be fulfilled by the leader of a family as if gives social security.
H1:
2.2 Performing the duties of charity
Zakat plays an important role in the effort to solve poverty. If its implemented as a whole, a country will not have
difficult to find the poor to give to charity (Hailani Muji Tahir:1982). It all begins with the implementation of proper
charity institution. Therefore, as an entrepreneur, performing zakat can actually complete the needs of the less able
and those in need.
H2 There is a relationship between the obligation to pay zakat to the achievement of entrepreneurs.
2.3 To serve the community
In addition to personal and family needs, striving to gain wealth would also benefit the society. The entrepreneur
always strives to deliver value to the community - either directly or indirectly (Asmak Hj. Ab. Rahman:2008).
Assistance that can be channeled by the entrepreneurs to society includes helping those who are in need, be it in
materialwise or affectionwise. Islam encourages its followers to love one another, help each other and work together
towards good deeds and eliminate evil. As long as he has the capability, the entrepreneur should always try to make
good deeds for the welfare of society. An entrepreneur is an intermediary provided by Allah to help share his wealth
with others. The more he gives to others in sincerity, the mor
means :-
If you give thanks to Me and I will add a provision to You, But if you disbelieve, then My punishment is
painful. (Surah Ibrahim:7)
An entrepreneur is also responsible for the less fortunate.

engaged in businesses in Medan do so to generate income to support and meet the needs of their families, the
remaining kept for savings, perform religious activities as well as helping the needy and orphans.
H3:There is a relationship between helping orphans and the poor with entrepreneurial achievement.
2.4 Develop the community's economic strength
It is no doubt that people look up to those who are economically strong. Respect and admiration for this group makes
them very influential be it in political, economic and social. A study by Fadli found that the contribution made by
Muslim entrepreneurs in small businesses in the Medan improve the economic field is at 90% whilst the contribution
of Muslim entrepreneurs in the SME is a 30%. This proves that Muslim entrepreneurs contributed to the improving
economy of Medan (Khairul Fadhli 2011). In general, social responsibility in defending and strengthening the Muslim
economy are as follows:
2.4.1 Muslim entrepreneurs as models of net economic activity
A Muslim entrepreneur is a strong impetus to the development and regarded as a warrior to the path of God.
Consistent progress in its economy fundamental so that he may perform tasks related to human well-being. A
successful Muslim - be in in this world and hereafter - is a Muslim who has a strong economy for oneself and can
contribute to society. This group also does not ignore the pillars of religious worship, such as charity, pilgrimage and
performing other good deeds. This ritual would be difficult to fulfilled without a strong economy (Khairul Fadhli
2011). Economic activities carried out by strong, religious Muslim entrepreneurs will create a good and respected
community this is because all the noble qualities embedded within him, such as compassion, cooperation, solidarity,
honesty and trust will be the basis of the activities practiced (Sobri Salamon :1989). The presence of a successful
Muslim entrepreneurs can be a role model in the economic success of the Muslims. The activities carried out by this
group are economic activities based on Islamic law and is far from the elements that violates it. The involvement of
these groups in the economic field will be an example to the community and other entrepreneurs to run business based
on Islam.
The study by Khairul Fadli (2011) found that most missionaries involved with the economic activity in the city could
t have the elements of
usury and are not engage in a speculative economy. In addition, the missionaries in Medan also has the potential to
expand their Islamic economic activity and become a model for other entrepreneurs to develop a successful economic
activity based on sharia.
H4:There is a relationship between the expanding business activities in accordance with Islamic law with the
achievements of entrepreneurs.
2.4.2 Responsibilities of an entrepreneur in providing employment opportunities to the community
The study conducted by Khairul Fadli (2011) found that missionaries in the entrepreneurial world helped to provide
employment opportunities to the community. According to his study of 15 missionaries in Medan, a total of 149
people have been employed for the various businesses.
H5: There is a relationship between employment opportunities to people with entrepreneurial achievement
2.4.3 Responsibility to help develop entrepreneurs in the Islamic economic system
The economic crisis of Muslims encountered currently is caused by unequal distribution of income and the lack of
work opportunity. All this while the community has been the object of development, and never to be fully involved
with a comprehensive development - that there is an imbalance in the face of global economic development. In Islam,
it has been that Islamic Ummah as a whole should emphasize the development aspect of both physical and spiritual.
t has a theoretical framework that
guides its followers to observe and adopt as a system of life. The presence of Islamic economic experts in the
economic system which upholds the principles of sharia would be incomplete without the driving force in realizing the
Islamic system. Entrepreneurs are important assets to implement the shariah-based economic system to the
community. To realize the economic system of Islam, Muslim entrepreneurs need to have an in-depth understanding
to meet the challenges of an ever expanding economy, convincing people through a
sharia-based economic activity and solving economic crisis based on true Islamic sharia.
The study conducted by Khairul Fadli (2011), revealed that there are still weaknesses among the missionaries that
were involved in developing the Islamic economic system. Many respondents felt that the development of this system
requires the cooperation of various parties including academics, government, entrepreneurs and the community itself.
He believes that the more missionaries involved in entrepreneurship will result in a growing public awareness of the
importance of Islamic system in their lives.
H6: There is a relationship between the development of shariah-based economic system with the performance of
entrepreneurs.
is an important issue that needs to be emphasized by the

entrepreneurs to achieve the goals and blessing of Allah, to be successful in the underlying business as well as to
provide benefits to others.
3. Methodology
A field study was conducted on 183 Muslim entrepreneurs in Malaysia. The purpose of this study is to verify the
findings of the hypothesis theories. An entrepreneur is considered successful if he has some characteristics of
successful business including managing the business for more than five years, improvement and achievements in the
business reflected by the increase of the workforce, having fixed assets, owning net assets and its share capital
increased. In this study, the performance is measured from through nine items that requires the entrepreneurs to
answer in a five point scale. Each scale refers to respondent's answers of being "Strongly disagree" (value 1) to
"Strongly agree" (value 5). The items to be assessed from includes revenue gained from managing the businesses,
assets ownership, growth of savings, duration of business is more than five years, the increased number of employees,
the size of the business market expands, increase business capital, increasing profitability and increased sales of its
products and/or services. The Cronbach alpha value of these nine items is 0.9. This means that the question has a high
reliability value. The hypothesis was based on non-parametric tests and the analysis used is the Pearson correlation
coefficient test. Pearson correlation test was conducted to understand the degree of relationship between the social
entrepreneurs achievement with successful entrepreneurs who practice social responsibility in Malaysia. The
correlation can indicate the direction and strength of the relationship that exists between the social responsibility of
entrepreneurs who are used as the dependent variable in this hypothesis.
Table 1: General interpretation of the correlation

The correlation coefficients Interpretation
< 0.20 A very weak correlation
0.20 to 0.40 A weak correlation
0.41 to 0.70 A moderate correlation
0.71 to 0.90 A high correlation
0.91 to 1.00 A Very high correlation
Guilford (1956)
The table above shows the general interpretation of the correlation. Values of correlation coefficients provides an
overview of the relationship between the entrepreneur and the achievement of social responsibility by successful
entrepreneurs. For example, the correlation that approaches the value of 1.0 indicates there is a very high positive
correlation, while a value between 0.01 to 0.03 indicate that there is a positive, but weak correlation. A positive
correlation coefficients indicates that there is a direct relationship between independent and dependent variables.
However if the correlation coefficients shows a negative value, then the relationship between the dependent and
independent variables are known as inverting relationship.
4. Result
Respondents in this study consisted of 130 males and 53 females. Most successful entrepreneurs are those aged 30
years they make up 80% of the study. At least 12% holds a diploma, 43% possesses a Degree, and those with
Master or PHD are at 16%. A total of 78% started their business with a capital of below RM100, 000, 19% opened
their business with a capital of RM100, 000 to RM500, 000 and the rest started their business capital above RM500,
000. 60% of successful Muslim entrepreneurs are able to earn less than RM50,000 month while 40% managed to
make over RM50,000 per month. 40% of the respondents holds a degree in Islamic education, 21% completed
secondary schools only while 18% studied religious study in primary school only.
The study of the relationship between social entrepreneurs and entrepreneurial achievements are as follows:
Hypothesis 1: There is a relationship between the responsibility of providing food, clothing and shelter to families and
the achievement of disadvantaged groups with entrepreneurs achievement.
Table 2: The relationship between the responsibility of providing food, clothing and shelter to families with
entrepreneurial achievement
The relationship between the responsibility Entrepreneur achievement
of providing food, clothing and shelter to Correlation
families with entrepreneurial achievement .186*
* Correlation is significant at the 0.05 level (2-tailed).
Through the first hypothesis analysis (Table 2), coefficient are given in the 0.186. This indicates that the variable
of responsibility to provide food, clothing and shelter to a family member had a positive but was very weak in
cepted
because of its significant relationship between the two variables. This is because the 0.012 is lesser than the fixed
significant level of 0.05 / 2. Therefore, this hypothesis proved that the responsibility of providing food, clothing
and shelter have a weak direct relationship. This study supported the study by Asmak Abdul Rahman who
concluded that Muslims are responsible to help the weak need to ensure the well being of the ummah . He said
if members of the conventional economic thinks it is necessary for human development to grow hand in hand
with economic development, then the same applies in Islam as it does not prohibit the people to strive for
success while at the same time consider the development to achieve maqasid al shari'ah.
Hypotheses 2:There is a relationship between the responsibility of zakat to the achievement of entrepreneurs.
Table 3:The relationship betwe to the achievement of entrepreneurs

Entrepreneur achievement
Correlation
.216**
The second hypothesis (Table 3) is the relationship between the responsibilities of zakat with the entrepreneurs
achievement, and it gives a correlation value of 0 is accepted because it has a significant relationship between the
responsibilities of zakat to the achievement of entrepreneurs as the end of the two variables is 0.003. The value is
smaller than the specified significance level of 0.05 in two-way correlation test. The finding in turn supports the
research conducted by Mohd Ali Mohd Noor (2004) who said that zakat awareness among Muslim professionals is
high. According to Mohd Noor (2004), the higher the value of faith and knowledge of a Muslim, they more inclined
they are to pay zakat .
Hypothesis 3:There is a relationship between helping the poor and orphaned children with entrepreneurial
achievement.
Table 4:The relationship between helping the poor and orphaned children with the achievement of entrepreneurs
Help the poor and orphans Entrepreneur achievement
Correlation
.364**
The third hypothesis (Table 4) analyses the relationship between helping the poor and orphans with entrepreneurial
achievement, and the correlation value is at 0.364. This shows that there is again, a positive yet weak relationship.
However, this hypothesis is accepted because it has a significant relationship between helping the poor and orphans
achievement since the end of the two variables is 0. This study supports the research that has been done by Khoirul
Fadli (2011) who found that most missionaries venture into business to generate income, and the revenue is channelled
to cater to families and the rest to help the poor and orphans .
Hypothesis 4: There is a relationship between business activities in accordance with Islamic law with the performance
of entrepreneurs.
Table 5:The relationship between business activities in accordance with Islamic law with the entrepreneurs
achievement.
Entrepreneur achievement
Business activities in accordance with Correlation
Islamic law .245**
Analysis of the fourth hypothesis (Table 5) is the relationship between business activities in accordance with Islamic
law with the performance of entrepreneurs, and this revealed a correlation value of 0.245. This shows the positive
relationship between the two is very weak. However, this hypothesis is accepted because of the significant relationship
between the performance of entrepreneurs with business activities in accordance with Islamic law as the value of the
end of the two variables is 0.01 and is smaller than the value specified coefficient of 0.05. This study supports the
study by Khairul Fadli (2011) who found most of the missionaries who to conduct their business in the city of Medan
economy according t
him, entrepreneurs such as this will become a role model for other entrepreneurs to expand their activities based on
Islamic sharia.
Hypotheses 5:There is a relationship between employment opportunities to people with entrepreneurial achievement.
Table 6: The relationship between employment opportunities to people with entrepreneurial achievement.
Employment opportunities to the Entrepreneur achievement
community Correlation
.245**
The fifth hypothesis (Table 6) is the relationship between employment opportunities for people with entrepreneurial
achievement, and the correlation value is 0.245. This reflects a positive but weak relationship between the two.
However, this hypothesis is accepted because of the significant relationship between providing job opportunities with
entrepreneurial achievement and the end of the two variables is 0.01 which is smaller than the value specified
coefficient of 0.05. This study also supports the study conducted by Khairul Fadli (2011) who revealed that preachers
who participate in the entrepreneurial world in Medan has provided job opportunities to the community.
Hypotheses 6: There is a relationship between the development of the economic system based on Islamic law with the
performance of entrepreneurs
Table 7: The relationship between the development of the economic system based on Islamic law with the
performance of entrepreneurs
Develop an economic system based on Entrepreneur achievement
Islamic law Correlation
.200**
The sixth hypothesis (Table 6) is about the relationship between the development of the economic system based on
Islamic Shariah with entrepreneurs achievement, and the given correlation value is at 0.200. This shows a very weak
positive relationship between the two. This hypothesis is accepted because the correlation values between the two
variables is 0.007 and it is smaller than the specified coefficient of 0.05. This also supports the study by Khairul Fadli
(2011) that indicates that missionaries involved in the business to develop the Islamic economic system still exists.
According to him, to develop sharia-based economic system requires the cooperation of various parties including
academics, government, entrepreneurs and the community itself. Therefore, the involvement of Muslim professionals
in the field of entrepreneurship is very important to develop an economic system based on Islam.
5. Conclusion
The hypothesis made by Pearson correlation coefficient found a significant relationship between the entrepreneur and
the achievement of social entrepreneurs in Malaysia. Although the relationship proved to be weak, it reflects the
commitment of Malaysian entrepreneurs in fulfilling social responsibilities. In Islam, social responsibility are strongly
encouraged to draw oneself closer to God and at the same time to fulfill the maqasid al-Shari'ah. When people can
feel the effort made by the entrepreneurs, and the responsibilities taken then they could personally feel that they have
developed as well. Therefore, from the Islamic perspective, the success factors is not only measured in economic
development, but in terms of spiritual and mental development of the Muslim community itself too.
As a conclusion, this studies only focuses on the social responsibilities among successful Muslim entrepreneurs in
Malaysia. Thus, for the further research, a comparison between the social responsibilities among Muslim and Non-
Muslim entrepreneurs can be carried out. Besides that, a research can focus on the case study about multi-millions
companies that operate social responsibilities as one of their strategic management.
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ICGSM 2014
Shariah audit in Islamic banks: an insight to the future shariah

auditor labour market in Malaysia
Zurina Shafiia, Nor Aishah Mohd Alib and Nawal Kasimc*
a
Islamic Finance and Wealth Management Institute (IFWMI), Universiti Sains Islam Malaysia, 71800 Bandar Baru Nilai, Negeri Sembilan,
Malaysia
b
Faculty of Accountancy, Universiti Teknologi Mara Kampus Bandaraya Melaka, 73100 Melaka, Malaysia
c
Accounting Research Institute, Universiti Teknologi Mara,40450 Shah Alam, Selangor, Malaysia
Abstract
This study purports to explore the perception of the undergraduates on shariah audit (SA) in the Islamic Banks in Malaysia. Our
findings suggest that there is significant difference between students being exposed to SA’s course and those who have not. The
study contributes to the body of knowledge as there is dearth of Islamic literature on SA. It can also result in positive implication
to the management or policy makers of the institution of higher learning in Malaysia in imparting SA as part of course offered to
their students and contributing to produce potential future shariah auditor in the industry.
Crown
© 2014Copyright © 2014
The Authors. Published
Published by Elsevier
by Elsevier Ltd.Ltd. This is an open access article under the CC BY-NC-ND license
Peer-review under responsibility of the Accounting Research Institute, Universiti Teknologi MARA.
Keywords:Shariah Audit; Islamic banks: Shariah Auditor
1. Introduction
The increase in the awareness for Islamic products encourages the need to have a robust Islamic financial
institution (IFI) in order to support the rise for Islamic banks in Malaysia. Whilst conventional banking institution
have gained trust from the general public, the popularity and widespread use of Islamic banks (IB) can still be
expanded.
* Corresponding author. E-mail address: nawal120@salam.uitm.edu.my
1877-0428 Crown Copyright © 2014 Published by Elsevier Ltd. This is an open access article under the CC BY-NC-ND license
doi:10.1016/j.sbspro.2014.06.023
Zurina Shafii et al. / Procedia - Social and Behavioral Sciences 145 (2014) 158 – 172 159
The Ernst and Young World Islamic Competitiveness Report 2013-2014 has also estimated that Malaysia’s
international Islamic banking assets are anticipated to raise to more than US$390 billion (RM1.27 trillion) by 2018
from US$125 billion (RM410 billion) in 2012 (Bernama, 2014). In addition, according to an industry publication,
the Global Islamic Financial Review, over the past 30 years, the Islamic financial sector has grown from practically
nothing to over RM1.6 trillion in assets. The financial crisis has also boosted the growth in Islamic financial
industry where the industry assets has grown 19% and 21% respectively in 2011 and 2012, in contrary to less than
10% increase in non-Islamic banks all over the world (Popper, 2013). This indicates that the Islamic financial
industry has been accepted by financial services users all over the world not excluding Malaysia, thus provide a huge
potential for the Islamic financial provider to prosper.
However, as an IFI, an Islamic bank is envisaged to emulate Islamic values in all aspect especially to the eye of
its stakeholders as the users of its services or banking products. Any Islamic corporation specifically Islamic
financial institution needs to have a reliable governance model and proper strategies that will encourage the
implementation of robust and effective corporate governance (CG) within the Islamic environment (Hassan, 2010).
Islamic banks have stakeholders such as Investment Account Holders (IAH), shareholders, creditors,
management, employee and community at large. Each of them has their own interest with regards to the IBs
continuity to uphold the Shariah principles and values. One way to safeguard the interest of these stakeholders is by
ensuring shariah-compliant operation and offering Shariah compliant services. To do so, a Shariah audit (SA) is
urged to be performed in those Islamic banking to ensure that corporate as well shariah governance are uphold, thus,
increases the stakeholders’ confidence level.
The conventional audit on the financial statement has long been associated to independent verification on whether
the institutions’ financial statement has been presented with true and fair view (Eilifsen, Messier, Glover and
Prawitt, 2010). To establish this, auditors need to have the analytical thinking competency as they need to perform
procedures using certain professional skill and techniques to verify the truth and fairness of their client’s financial
statement. The function of audit from the Islamic view is much more important and mandatory as it manifests the
accountability of the auditors not only to the stakeholders, but ultimately to the Creator, Allah s.w.t as the Muslims
believe that one’s action and thoughts are always being watched by Allah (the concept of Muraqabah). It is the
fundamental of Islam with the edict that “…..surely Allah will take account of all things” (Al Quran, An Nisa’ : 86).
In considering the rapid growth of the Islamic market, it is crucial for the Islamic financial industry to have an
adequate ‘check and balance’ mechanism in the form of shariah auditing tailored made the objectives and missions
of its establishment, the ‘maqasid al-shariah’ (Yaacob and Donglah, 2012) or literally means the objectives of
Islamic law. The key objective of shariah is the recognition of benefit to the people (maslahah of the ummah),
relating to their affairs both in this world and the heareafter (Laldin, 2011) as oppose to merely maximizing profit as
the goals of conventional banking institutions.
In the context of this study, Shariah auditing can be defined as a systematic process of obtaining sufficient and
relevant evidence to form an opinion as whether the subject matter i.e. the personnel, process, financial as well as
non-financial performance consistent with the Shariah rules and principles which is widely accepted by the Islamic
community and to report to the stakeholders (Mohamed, 2007). On the other hand, the Shariah Governance
Framework (SGF) introduced by BNM in 2010 defined shariah audit in para 7.7 as
“periodical assessment conducted from time to time, to provide an independent assessment and objective
assurance designed to add value and improve the degree of compliance in relation to the IFI’s business
operations, with the main objective of ensuring a sound and effective internal control system for Shariah
compliance” (BNM 2011, p. 23).
Despite the importance of Shariah auditing (SA), there has been however, little understanding on how to
implement an effective and efficient SA from the human capital perspective. Hence, this study determines to
elaborate the necessity for a study on human capital development from the educational perspective to cater the needs
for shariah auditor in the IBs in Malaysia.
160 Zurina Shafii et al. / Procedia - Social and Behavioral Sciences 145 (2014) 158 – 172
1.1 Unique characteristics of applying Shariah in Islamic bank (IB)
Unlike other conventional banks in Malaysia, a distinct feature of an IB is that its main objective in fulfilling
‘maqasid al-syariah’, which literally means Islamic law (Kasim, Mohamad and Sulaiman, 2009). The concept is best
explained by Chik (2011) where he described the foundation of SA as the true accountability, where IBs is not only
accountable to their stakeholders or authorities but most importantly to Allah s.w.t as part of religious obligation to
be the best solution to achieve good corporate governance. Shariah compliant in IBs refers to the activities and
operations of IBs to be free of any elements of sinful activities, shariah of risk, exploitation as well as having real
economic purpose to finance socially productive sectors in the economy (Mohamed, 2007).
1.2 Shariah Audit Requirement in Malaysia
The importance of having an independent audit on companies has been taken seriously by the Malaysian
government. In Malaysia, corporations registered as private limited are subject to be audited by the external auditors,
not precluding the Islamic banks, which are governed by the Islamic Banking Act 1983. The importance of shariah
governance is realized by imparting them as part of enhancing corporate governance in the Malaysian business has
been outlined specifically in the Shariah Governance Framework (SGF) as issued by the BNM and became effective
as at 1 January 2011. The guideline has specifically ruled that Islamic banks in Malaysia need to appoint and elect a
committee consist of competent person on Shariah affair which is responsible to liaise with other Board of Directors
to ensure the banks is operating under shariah compliant. However, Malaysia is still facing lack of competent
shariah officer who are both skilled in shariah as well as auditing (Kasim et al., 2009 ; PwC 2011).
Before SGF introduced in 2011 by the BNM, the shariah governance of the IFIs is bestowed upon the shariah
committee to oversee any shariah compliant matters. They may also have to perform both shariah review as well as
shariah audit. At that time, there were no specific guidelines on shariah governance in IFIs. However, post 2011,
with the introduction of SGF there are major changes to shariah matters in IFIs. The SGF as depicted in Figure 1 has
taken shariah issue seriously by establishing four (4) function of shariah to be implemented in Islamic finance
namely Shariah risk management control under the supervision of board risk management committee as well as
management, shariah review function governed by shariah committee as well as the management, shariah audit
function also under the shariah committee and lastly the shariah audit function, which is the focus of this study to be
reporting to the shariah committee as well as the board audit committee. Whilst the shariah research and shariah
review function are undertaken by the shariah officers who are shariah undergraduates in the respective IBs, shariah
risk function is usually performed together by the finance and shariah officers who are usually undergraduates
majoring in finance or shariah, the shariah audit function is currently performed by the internal auditor of the IBs
with no specific guidelines on the ideal qualification of a professional to be appointed as the shariah auditor of an IB.
Hence, the implementation of shariah auditing needs to be addressed even at the educational level where the
human capital in terms of the practitioners to the shariah auditor itself must firstly be resolved. Most of the
undergraduates in Malaysia are either trained in auditing from the product of accounting courses offered by the
public universities or shariah graduates who are the product of the Islamic Studies courses. To date, to the researcher
knowledge, no local universities or professional bodies in Malaysia offer any professional certification for shariah
auditor. Hence, there is a question on the readiness and capability of our current education system to prepare human
capital towards the implementation of shariah auditing in the IBs in Malaysia.
Fig. 1. Shariah governance framework for Islamic Financial Institutions

(BNM 2011, p.8)
2. Literature Review
Scarce literature in the form of empirical studies has been noted to cover on the SA issues. Most studies are in
the form of conceptual paper or merely discussion through conference proceedings. The need for SA in Malaysia
was first investigated by Kasim et al. (2009). The study covering 22 respondents consisting of external auditor,
Shariah supervisory board members and staff of shariah compliance from nine (9) IFIs and six (6) Islamic branches
of conventional banks in Malaysia using interviews has became one of the earliest research in the area. The studies
revealed that most IFIs would prefer to have shariah review as opposed to comprehensive SA as at that time,
performing SA by external auditor is not required by law, lack of expertise, as well as increasing the cost of the
banks’ operation. Recent ruling by BNM (2011) through its Shariah Governance Framework (SGF) has shed some
light to effective Shariah governance implemented in the IFIs in Malaysia. With the rulings, every IFI needs to set
their own Shariah Committee and specific guidelines on the characteristics of the shariah committee have also been
outlined. SGF provide guidelines on how SA to be performed by the Shariah office in the existing IBs but there is
still no specific requirement that the SA (or shariah review) to be performed by the external auditor.
In Malaysia, there are only two local full-fledged Islamic banks namely Bank Islam Malaysia Bhd (BIMB) and
Bank Muamalat Bhd (BMB) offering Islamic banking products to the Malaysia banking consumers. A case study
conducted by Besar, Abd Sakor, Abdul Muthalib and Gunawa (2009) on BIMB and BMB also revealed that the
shariah committee from both banks are only satisfying a minimum requirement of the report. Preliminary analysis
on the annual reports of both IBs reveals that there are differences in terms of scope of SA that have been performed
in both banks. Although SGF as mentioned earlier has outlined the area that SA should be addressing, it is believed
that the application of the guideline can be quite misleading due to different interpretation of the requirement
outlined in the SGF. For example, the term used to refer to the body bestowed or responsible to tackle shariah issue
in IBs is being referred differently by different banks; BNM and BMB refers it as Shari’ah committee whilst BIMB
refers it as Shariah Supervisory Council (SSC) (www.bnm.gov.my, www.bimb.com.myand
www.muamalat.com.my). The extent of the report disclosed in the annual report by the shariah committee in both
banks can be argued to be too simple, covering only audit compliance of products, focusing on the contracts and
documents used in the IBs’ operation. The SA scope can be extended to include other areas such as the
organizational structure, process and information technology application system, human resource management as
well as audit of financial statement (Shafii, Salleh, Hanefah, and Jusoff, 2013) as well as having a SA framework
encompassing SA’s programmes and procedures (Rahman 2008; Shafii et al., 2013).
The following paragraphs will discuss shariah auditing based on the previous literatures from the aspect of human
capital, accounting education and study on the students’ perception.
2.1 Human capital development
One aspect that need not be neglected in implementing SA is the need to have competent human capital in
relation to audit skills and shariah literate. Human capital needs is described by Laldin (2011) as the need to ensure
the availability of human capital in the form of human talent management to generate ample pool of competent
officers and Shariah experts are crucial to spearhead innovation of Islamic financial products and services. To meet
this increasing demand for manpower, institutions of higher learning and the IFIs are urged to initiate new
programmes and training for Islamic banks. To further elaborate the importance of human capital in an organization,
Cheng, Liu and Chien (2009) in their longitudinal studies over 4865 observation spanning over 15 years from 1989
to 2004 on human capital and audit quality, revealed that higher investment in human capital corresponds to higher
level of auditor quality. In addition, there is a challenge for future accounting graduate to understand the different
adoption of standards in the Islamic accounting world as different standards have been adopted differently by
different Muslim countries. Hence, we would expect graduates from Malaysia will need to understand International
Standards and standards adopted by other Muslim countries if they wish to work in other countries besides Malaysia.
On the other hand, a local study by Abdullah and Zakaria (2006) in two local universities, namely University of
Malaya and International Islamic University of Malaysia, over 200 third year Accounting students shows that
students rank opportunity and career advancement as the main requirement as their desired public accounting firms.
The result of this study may assist public accounting firms in developing policies that may attract quality recruits to
join the audit firms. On the other hand, the public university administration may also use this information to provide
their graduate with value added knowledge such as knowledge in SA as required by their potential employer in the
banking industry, be it fully fledged IBs or conventional banks with Islamic banking subsidiaries.
Shafii et.al. (2010) stressed that successful audit depends on the strength of human resources such as having
credible expertise to set the work plan and reviewing the result. There is also a strong need for proper training on
Shariah concepts since most of the bank officers are trained from conventional background, thus they do not
understand how to apply such concepts, thus providing the wrong explanation on the banking products to their
customers. There is therefore, a challenge for scholars and academicians to ensure the current as well as future
accounting graduates are exposed to Shariah knowledge before they embark the job market. The argument is also
supported by the survey on 15 banking institutions performed by PwC (2011) which revealed that there is a need to
expand the talent pool with SA knowledge and competencies. To do so, educators need to be trained specifically in
the Shariah Auditing and well verse in the shariah issue. Hence, previous empirical findings emphasized the need to
integrate SA as part of courses offered to the accounting students.
2.2 Accounting education
A study by the Big Eight accounting firm in United States determines that higher learning institutions need to
periodically change or revise their accounting curriculum to cater needs for their clients, which in this case may refer
to the future employers once their students graduate (Palmer, Ziegenfuss and Pinsker, 2004). This study is supported
by another research conducted by Paisey and Paisey (2010) who encouraged accounting educators and education
policy makers to explore the potential of incorporating ideas from other professional education system. Another
study on accounting academicians throughout 39 universities in Australian revealed that academic accountant
contended that quality assurance and improvement systems could be designed to assure quality that is promoted in
accounting education rather than quality that ought to be promoted (Watty 2005). This study is further supported by
Rahman (2008) as well as PwC (2011) studies which also emphasized the necessity for SA education to be enhanced
and disseminated among the accounting students.
Another study on whether student would choose auditing as line of their field of study and future career was
performed over 276 undergraduates in two (2) universities in US (Yavas and Arsan, 1996). The study revealed that
students with accounting or auditing background are very likely to favour auditing as their career of choice. The
findings indicated the auditing stand among the students besides providing insights to the academicians on how to
inculcate interest among the students at early stage of their study in the university (Yavas and Arsan, 1996). A much
recent study conducted in Australia involving 131 second year students majoring in Bachelor of Commerce at the
University of Victoria, however, provides an opposite findings where exposure to accounting at university does not
develop positive attitudes on accounting as a discipline but rather emphasizing on rule-memorization as well as lack
of participation with conceptual skills or judgement (McDowall and Jackling, 2010).
Another study was conducted in Australia to establish whether teachings and learning gaps would have any
implications on accounting graduate employability by Taylor, Fischer and Sulaiman (2001). The quantitative study
was conducted by distributing questionnaire to 34 academicians and 332 accounting major students of a BBA degree
from various years of study at a university in Australia which is ranked high for its undergraduate business and
economics programs at the national level. The questionnaire posed on students in relation to their studying or
learning approaches given by their instructors whilst the latter were asked on their perception on their facilitation
over the approaches that they have chosen. The study found that there were significant differences in terms of
emphasis of teaching approaches between the students and the academicians (Taylor et al., 2001).
Currently, in Malaysia, only a few Malaysian public universities offer Islamic accounting as their course subject
as part of fulfilling their degree requirement such as International Islamic University of Malaysia and Universiti
Sains Islam Malaysia. The accounting degree syllabus offered by the local universities need to expand their scope by
imparting the Islamic accounting course specifically the SA studies as an elective course in order to equip the
students with the skill and knowledge required by their potential future employer. A study by Amin, Rahman and
Ramayah (2009) using self-administered questionnaires over 135 respondents consisted of Universiti Malaysia
Sabah (UMS) students revealed that attitude, subjective norm and amount of information on Islamic accounting are
found to affect the intention of students to enroll in Islamic course. Their study which used the Reasoned Action
popularized by Ajzen and Fishbein in 1975 postulates that there is a strong relationship between beliefs, attitudes,
intention and behavior (Amin et al., 2009). Hence, it is believed if the right information is disseminated to the
Muslim and non-Muslim students alike, a better understanding over shariah audit as part of shariah compliance can
be achieved for them. This is particularly crucial as the new generation students will occupy the various Shariah
related positions in any Islamic financial institution once they graduated. Having an additional knowledge in shariah
can also be a value-added to these graduates as they may compete healthily in the job market besides producing
multi-skilled workers in IBs industry.
An equally interesting discussion on professionalizing the role of shariah auditor in Malaysia and making
Malaysia as the hub for shariah audit’s professional certification was posed by (Najeeb and Mohamed Ibrahim,
2013). In their conceptual paper, they discusses on how Malaysia can become the main player to produce
professional shariah auditor by establishing an accounting and auditing bodies such as Association of Chartered
Shariah Accountants and Auditors (ACSAA) which can generate economics benefits which have long been
dominated by the Western countries, for instance, through the establishment of ACCA and CIMA.
The only certification of shariah advisor and auditor was noted to have been initiated by AAOIFI known as
‘Certified Shariah Advisor and Auditor’ (CSAA). CSAA program is structured such that candidates under the
programme are equipped with requisite technical understanding and professional skills on shariah compliance review
processes for the international IB and finance industry. The program also covers technical subjects that are essential
to shariah compliance and review processes and procedures such as AAOIFI’s shariah standards on Islamic products
and practices, AAOIFI governance standards on shariah compliance and review processes, Islamic banking and
finance supervision as well as the application of shariah and Fiqh (Islamic jurisprudence) to Islamic banking and
finance practices (AAOIFI 2013).
2.3 Students perception
Few studies have been performed to determine the students’ perception on certain aspect of their studies. A study
to determine the students’ perception of their learning environment and academic outcome was performed by Lizzio,
Wilson and Simons (2002) in Australian involving 2130 usable responses out of 5000 students randomly selected
representing approximately equal number of students from both gender across 14 faculties (including business and
commerce) and all years of study. The study conducted using survey where questionnaire were mailed to the
individual student three (3) months before the academic year ended. However, out of 2130 usable responses, only
646 final university sample comprising students from the disciplines of commerce, humanities and science as those
were the only faculties with a sample size large enough to produce valid and reliable results using the path analysis
which only consider sample more than 150 for inclusion in the analysis. The cross-disciplinary sample of
undergraduate students which were analysed using high order path and regression analysis, confirmed that students’
perception influenced both the ‘hard’ (academic achievement) and ‘soft’ (satisfaction, key skills development)
learning outcomes, both directly and intervened through their approaches to study. The study found that students’
perception of their current learning environment acts as a stronger predictor of learning outcomes at university as
opposed to their prior accomplishment at school.
On the other hand, another study which took place in United Kingdom investigated the students’ perception of
academic quality and approaches to studying in distance education with the Open University by Richardson (2005)
using 2152 usable questionnaire survey administered to over seven (7) courses long distance learning students. The
students were asked seven (7) groups of question in relation to appropriate assessment, appropriate workload, clear
goals and standards, generic skills, good materials, good tutoring and student choice which leads to the perceived
academic quality. The students were assigned scores on the each scale by computing the mean responses. It was later
revealed that students’ academic quality were determined to some extent more by their perceptions on receiving
good materials and clear goals and standards as opposed to receiving generic skills, good tutoring, appropriate
assessment, choice in their studies or an appropriate workload. The study also found that students’ perception on the
academic quality of courses in the distance learning is strongly related to their studying methods adopted by on those
courses.
The only studies noted specifically addressing the issue of shariah audit amongst the students were conducted by
academicians in Brunei. The first exploratory study on shariah audit for instance, was conducted on postgraduate
students in Brunei to determine the awareness and understanding of the students on the term and concept of shariah
audit (Yaacob and Donglah, 2012). The study involved questionnaire survey over 27 students from two (2)
universities in Brunei. The findings which were mainly presented in descriptive statistics revealed that there was a
low level of awareness and understanding of the term and concept of shariah audit among the students as those
students have never been exposed to any shariah audit concept throughout their course syllabus (Yaacob and
Donglah, 2012). The same author has later extended the study so as to include 59 undergraduate students of three (3)
universities from various majors namely accounting, business, finance and shariah inn Brunei as the sample (
Yaacob, Shafeek and Nahar, 2013). The study has reached the same conclusion as the previous study as majority of
the students are unaware of what are the precise role of shariah auditor as no specific academic courses have been
taught to them.
As there is little knowledge on how university students in Malaysia perceive the concept of shariah auditing in the
IB in Malaysia, this exploratory study aims to determine the needs for new skills and knowledge in relation to
Islamic accounting among the university students in Malaysia. In addition, this study also purports to confirm
whether there is any significant difference in terms of perception over the concept of shariah audit between the
students from the two (2) universities. Thus, the following hypothesis entails,
H1 : There is significance difference between students who have learnt shariah auditing in terms of perception
and level of awareness in shariah audit on the implementation of shariah audit in Islamic banks in Malaysia.
3. Research Methodology
This exploratory study which used the quantitative approach is believed to be the best method to address and
justify the research problem posed due to time limitation. Methodologically, a set of questionnaires using both
languages i.e. English and Bahasa Melayu based on previous studies ((Yaacob and Donglah, 2012); Kasim et al.,
2009; PwC, 2011) is developed and is deemed appropriate for the purpose of this study.
There are three steps in conducting this study. Firstly, a questionnaire is designed to obtain the information on
the undergraduate final year students’ perspective, awareness and understanding on the term and concept of shariah
audit in Malaysia. Secondly, the questionnaire was hand administered to the selected students from two local
universities, namely University A (Uni A) and University B (Uni B) for the purpose of this study i.e.:
(i) Those final year students who learnt shariah auditing as part of their course syllabus. These students
are selected because they have to undertake Al-Tadqiq Al-Shari'e (Arabic word for shariah audit) as a
subject as part of their course syllabus requirement. In the previous semester, they were also taught
Fiqh-Muamalat as part of their course requirement.
(ii) Those final year students who learnt only conventional auditing course offered by a local university
These students are chosen because the researcher believes they have the understanding over audit
matter since they have taken audit course as subject two times throughout their studies i.e. during their
final semester at the Diploma level and currently undertaking advance audit paper in their final
semester of their degree program. Another valid reason is because the students have undergone their
industrial training in the previous semester, hence having better idea of the working environment that
they would expect to encounter once they graduated. Thirdly, the questionnaires will be analyzed to
find the perceptions and general view of the subject matter from the undergraduate’s perspective.
The questionnaire is divided into four (4) sections: The first section purported to obtain the demographic
information of the respondents. The second section (section B), nine (9) questions posed on the level of awareness
and knowledge of shariah audit of the respondents. In this section, the questions posed are close-ended type in
nature. Few questions also provide more than one choice of answer to the respondents. In the third section (Section
C), the respondents were asked on their perception regarding shariah audit practice in Malaysia in the form of Likert
scales of five; ranging from (1) strongly disagree to (5) strongly agree. However, ranging from (1) to (5) with
indication of strongly disagree and strongly agree are shown respectively as scales at the top of the question
instruction in order to reduce the likelihood of respondents’ proneness to choose ‘Neutral’ as their answer. The last
section (section D) is optional sections where the respondents are asked indicate the type of special skills and
knowledge that they would want their university to offer in the condition if they are interested to work in an Islamic
financial institution.
Subsequently, 380 questionnaires were hand administered to the respondents. This study used both purposive as
well as convenience sampling where the questionnaire were distributed by hand and based on voluntary participation
to a group of students within the researcher working area. It is believed the homogenous nature of the respondents
can be the representative of the whole population of the majority of accounting students from other universities in
Malaysia who are taught only the conventional audit. All respondents were briefed beforehand that the study is
strictly for academic purposes and they can voluntarily answer the questionnaire.
A total of 355 questionnaires were returned. As only the completed questionnaires are used for the final
analysis, four (4) questionnaires are deemed as void. In total, only 351 questionnaires out of 380 questionnaires
distributed will be considered valid, resulting a 90.25% which is considered very high and valid for a simple
statistical analysis. Out of 351 questionnaires collected, 164 were collected from Bachelor of Accounting students
from University A and 187 questionnaires collected from students from University B. The valid responses were
tabulated and analyzed using the Statistical Package for Social Science (SPSS) version 21. The study will discuss
mainly the descriptive statistic and independent t-test sample of responses to each of the variable under study.
4. Findings and Discussion
The reliability analysis performed is testing the reliability coefficient of the data using the Cronbach alpha, based
on the average correlation of the sample items within a test if the items are standardized (Coakes and Ong, 2013).
The Cronbach alpha coefficient for the actual data is 0.71 on 16 items of the Likert scale which is slight lower than
the pilot study score but is acceptable for the further analysis. Nunally as cited in (Pallant, 2011) recommended a
minimum of 0.7 Cronbach alpha value to be fulfilled before the data can be used for further analysis.
Table 1. Distribution of respondents by gender, race and age groups (n=351)
Uni A Uni B TOTAL

Gender Frequency % Frequency % Frequency %
Male 45 12.8 41 11.8 86 24.5
Female 119 33.9 146 41.6 265 75.5
Race
Malay 163 46.4 184 53 349 99.4
Others 1 0.3 1 0.3 2 0.6
Age distribution
20-25 years old 158 45 187 53.3 345 98.3
26-30 years old 5 1.4 - - 5 1.4
Above 30 years old 1 0.3 - - 1 0.3
Table 1 shows the distribution of demographic data according to gender, age and race. Out of 351 samples, 265
are females, representing 75.5% of the samples and 86 sample representing males’ respondents (24.5%). As for the
race, only two samples came from ‘others’ race specifically the Sabahan bumiputera whilst the rest of the sample i.e.
349 or 99.4% make up of Malays respondents. In terms of age distribution, majority of the respondents i.e. 345
(98.3%) lies between the age of 20-25 years old, followed by 5 respondent (1.4%) of 26-30 years old and only one
(1) respondent which represents 0.3% of the sample aged above 30 years old. These results are not much dissimilar
from the study by Yaacob and Donglah (2012) as females are still dominating the public universities in the Asian
region.
Table 2. Awareness on the term ‘shariah audit’ and knows the difference between shariah audit and conventional audit
Uni A Uni B
YES NO YES NO
Freq % Freq Freq % Freq %
Knows the term shariah audit 84 23.9 80 22.8 187 53 - -
Knows the difference between
shariah audit and conventional 85 24.2 79 22.5 179 51 8 2.3
audit
From the above table, it shows that only 84 (23.9%) of Uni A respondents knows the term ‘shariah audit’ as
opposed to all respondents from Uni B are aware or have heard of the term. This may indicate that the respondents
from Uni A are not familiar with the term. Subsequently, it is logical to see almost the same result for respondents’
understanding on the difference between shariah audit and the conventional audit besides the fact that the
respondents from Uni A are exposed to the conventional audit but have not been exposed to the shariah audit as part
of their syllabus. This finding contrasted the study by Yaacob and Donglah (2012) on the postgraduates in Brunei as
majority of them (78%) were not able to differentiate the conventional to the normal audit as well as study by
Yaacob et al. (2013).
Table 3 Sources for information on shariah audit*
Frequency Percent
None (from table 2) 80 22.8
TV 39 11.1
Radio 13 3.7
Internet 113 32.2
Words of mouth 84 23.9
Others 176 50.1
*multiple answers
As shown in Table 3, almost a quarter of the respondents which is mainly from the Uni A students i.e. 80 (22.3%)
have never heard of the term shariah audit from any type of medium whilst 113 (32.2%) acknowledge that they have
heard the term through the internet, followed by 84 (23.9%) by words of mouth or friends, radio by 13 (3.7%) and
TV by 39 (11.1%). ‘Others’ category which carries 176 or 50.1% respondents refers mainly to the lecture which was
delivered to the Uni B students. The pattern of source of information for such term is different to the findings by
Yaacob and Donglah (2012) as postgraduates chose words of mouth as the highest mode as opposed to internet.
Perhaps this is a signal that internet is the famous mode to communicate of social issues to the public particularly the
young generation.
Table 4. Coverage of shariah audit
Uni A Uni B TOTAL

Frequency % Frequency % Frequency %
All activities 141 40.2 171 48.7 312 88.9
Sampling 23 6.6 16 4.5 39 11.1
Based on Table 4, a majority of the respondents, 312 (88.9%) is in the opinion that shariah audit should be
performed for all activities in the Islamic financial institutions, whilst 39 (11.1%) agree it should be performed by
sampling methods i.e. depending on the auditor’ judgment. These results are not much dissimilar from the study by
Yaacob and Donglah (2012).
Table 5. Period to perform shariah audit*
Uni A Uni B TOTAL

All year 94 26.8 93 26.5 187 53.3
End of the year 69 19.7 92 26.2 161 45.9
New financial product 62 17.7 105 29.9 167 47.6
*multiple answers
Table 5 presents multiple answers on the ideal period to perform the shariah audit in the opinion of the
respondents. More than half of the respondents, 187 (53.3%) agreed that shariah audit need to be performed
throughout the year whilst 161 (45.9%) and 167 (47.6%) respondents respectively believed that they should be
performed at the end of the year or only when new financial product introduced respectively. The findings is
consistent with the study by Yaacob and Donglah (2012).
Table 6. Involvement of shariah scholar*
Uni A USIM TOTAL

Audit planning 125 35.6 142 40.5 267 76.1
Audit report 111 31.6 57 16.2 168 47.8
Review report 91 25.9 131 37.3 230 63.2
Facilitate audit 82 23.4 92 26.2 174 49.6
Not involve at all 9 2.6 5 1.4 14 4
*multiple answers
Table 6 shows the multiple answers for the involvement of shariah scholar in shariah audit. 76.1% (267)
respondents are in the opinion that the shariah scholar should be involved actively during the audit planning, perhaps
in giving direction, strategy and guidance on how to execute the audit. The next best stage chosen is during the
review of audit report such as getting feedback from the management with 230 or 63.2% respondents. This is
followed by 174 (49.6%) respondents who feel that shariah scholar should assist the audit fieldwork exercise. Less
than half respondents, 168 (47.8%) think shariah scholar should assist the shariah auditor in preparing the audit
report whilst 14 (4%) respondents believe that no involvement of shariah scholar throughout the implementation of
shariah audit process is necessary. Again, these results supported the study by Yaacob and Donglah (2012).
Table 7. Shariah audit scope*
Uni A Uni B TOTAL

Policies 134 38.2 150 42.7 284 80.9
Reports and Circulars 90 25.6 107 30.5 197 56.1
Contracts and agreement 127 36.2 141 40.2 268 76.4
Process and procedures 117 33.3 152 43.3 269 76.6
Marketing 54 15.4 85 24.2 139 39.6
Human Resource 64 18.2 78 22.3 142 40.5
Zakat 134 38.2 113 32.2 247 70.4
Social activities 91 25.9 87 23.8 178 49.7
Finance 137 39 162 46.2 299 85.2
Environment 50 14.2 58 16.6 108 30.8
IT 39 11.1 66 18.2 105 29.3
*multiple answers
In Table 7, on the scope of shariah audit, the most selected area by the respondents is the finance area with 299
(85.2%) which is expected since the accounting students are very much exposed to the accounting and finance area,
thus place higher emphasis to such area. The second most selected scope is the policies with 284 (80.9%)
respondents agreed to be imparted in shariah audit. This is followed by contracts and agreement with process and
procedures with 269 (76.6%), contracts and agreement with 268 (76.4%), zakat with 247 (70.4%) and reports and
circulars with 197 (56.1%); strengthening the fact that all these four areas are related to the operation of the Islamic
financial institution if they are to be applied rigorously. The least scope less expected to be covered by the shariah
audit is the IT environment with only 105 or 29.3% respondents perhaps due to the fact that most respondents
believed that IT is not directly related to the implementation of shariah audit. This result is slightly different from the
study by Yaacob and Donglah (2012). as the postgraduate in Brunei chose Zakat as the most selected audit shariah
scope.
Table 8. Qualification of shariah auditor*
Uni A Uni B TOTAL

Accounting and shariah 104 29.6 121 34.5 225 64.1
Accounting 26 7.4 11 3.1 37 10.5
Accounting and shariah certificate 66 18.8 84 23.9 150 42.7
*multiple answer
For the qualification of shariah auditor, more than half of the respondents, 225 (64.1%) agreed that shariah
auditors should possess both qualification in accounting and shariah. The respondents’ second choice would be a
qualified person who has at least a shariah certificate besides possessing an accounting professional degree i.e. by
150 (42.7%). Another remarkable finding also reveals that these students indirectly admitted that having an
accounting degree alone is not enough to qualify them in performing the shariah audit as only 37 (10.5%)
respondents agreed that shariah auditor should have only accounting qualification. Again, these results is consistent
with the findings by Yaacob and Donglah (2012).
Table 9. Duty to perform shariah audit*
Uni A Uni B TOTAL

External auditor 35 10 48 13.6 73 23.6
Internal auditor 16 4.6 44 12.5 60 17.1
Shariah auditor 113 32.2 122 34.8 235 67
Shariah Supervisory Board (SSB) 46 13.1 65 18.5 111 31.6
*multiple answers
A majority of the respondents i.e. 235 (67%) agreed that shariah audit should be performed by a qualified shariah
auditor as depicted in Table 9 above. This is followed by Shariah Supervisory Board (SSB) and external auditor by
111 (31.6%) and 73 (23.6%) respondents respectively. The least chosen answer is the internal auditor with only 60
(17.1%) which is understandable due to its independence issue. These results are not much different from the study
by Yaacob and Donglah (2012). Ironically, in Malaysia, the internal auditors are still the one who performs the
shariah audit in the IBs.
4.1 Analysis on skills and knowledge required by students
Section D of the questionnaire pose a multiple choice answers to the type of skills and knowledge that the
respondents would want the university to offer if they are interested to work in the IFIs. Below is the summary of
the analysis obtained.
Table 10. Skills and knowledge*
Uni A Uni B TOTAL

Shariah issue 71 20.2 111 31.7 182 51.9
Islamic Economy 63 17.9 103 30.5 166 48.4
Islamic Finance 105 29.9 140 39.9 245 69.8
Interpersonal and Communication 47 13.4 40 11.4 87 24.8
*multiple answers
Table 10 shows that the highest skills and knowledge needed by the respondents are those related to Islamic
finance with 245 (69.8%), followed by shariah issue with 182 (51.9%), Islamic Economy by 166 (48.4%) and lastly
by interpersonal and communication skill i.e. by 87 (24.8%) respondents respectively. This finding indicates that
majority of the undergraduate students think they need to be equipped with Islamic finance knowledge in order to
have better understanding on matters dealt in IFIs besides being competitive with other undergraduates from other
local universities such as International Islamic University of Malaysia (IIUM) which impart more Islamic accounting
subjects as part of their course curriculum. The findings also suggest that what is important between the two groups
are not much different, implying that students who have never learnt shariah audit as a subject are aware about the
possible areas of interest in the Islamic banking area. The findings for the two highest choices support the findings
by Yaacob and Donglah (2012) and Yaacob, et al. (2013).
4.2 Comparing means of two groups using an Independent t-test
The independent sample t-test was conducted to compare the perception scores for USIM and Uni A students
based on the 16 questions posed in section C of the questionnaire. The instrument asked in section C basically covers
area such as shariah audit framework, scope of shariah audit, qualification for shariah audit, willingness of students
to learn more on shariah audit and whether their current course curriculum is sufficient for them to conduct shariah
auditing. The below table (Table 11 and Table 12 in the next page) shows that there was significant difference in
scores for Uni B (mean=65.123, STD deviation = 5.77) and Uni A (mean=60.945, std deviation = 6.39; t (349)
=6.43, p=0.00, two-tailed). The magnitude of the differences in the means (mean difference = 4.178, 95%
Confidence interval: 2.89 to 5.45) was slightly large (eta squared* = 0.106) (Pallant 2011). The result implied that
there is significant difference between the perceptions of students in Uni B on shariah auditing concept who have
learnt shariah auditing as opposed to the students in Uni A who was not exposed to the subject as part of their course
syllabus, thus rejecting the null hypothesis and accepting H1.
Table 11. Group means statistics
Course N Mean Std. Deviation Std. Error Mean

Uni B 187 65.1230 5.77731 .42248
TOT_Level_of_Agreement
Uni A 164 60.9451 6.39426 .49931
** Calculation for eta squares ( the effect size for independent sample t-test)
Eta squared = . t2 .=. 6.432 . = 0.106

2 2
D t +(N1 + N2 – 2) 6.43 + (187 + 164 – 2)
Table 12. Result of Independent Samples Test
Levene's Test
for Equality t-test for Equality of Means
of Variances
95% Confidence
Sig. Interval
Mean Std. Error
F Sig. t df (2- of the Difference
Difference Difference
tailed)
Lower Upper
Equal
variances 0.828 0.364 6.43 349 0 4.17787 0.64973 2.89999 5.45575
assumed
TOT_Level_of_Agreement Equal
variances
6.388 331.182 0 4.17787 0.65406 2.89123 5.46451
not
assumed
5. Conclusion
The study has taken considerable step to explore the perception of final year undergraduates accounting students
regarding the implementation of shariah audit in Malaysia. A general interpretation of the results is that a majority of
the undergraduate students who have never been exposed to shariah auditing are unaware of the term shariah audit,
hence not knowing the difference between the conventional audit and shariah audit. This is not an encouraging result
since there are high probabilities that they may join the workforce in the Islamic financial institution in the future.
The respondents were also of the view that audit shariah should not confine merely to the financial statement but
also covering other operational activities of the Islamic financial institutions. Despite lower level of understanding
over shariah audit, the students are willing to learn more about shariah audit as part of their course subject and areas
related to Islamic finance. In addition, the respondents also agreed that whilst there is an urge to establish audit
shariah framework, ideally shariah audit should be conducted by a professional possessing both auditing and shariah
qualification besides adequately trained in banking operations and financial products. On the other hand, issues
pertaining to Islamic finance and Shariah were selected as additional skills and knowledge required by the students
in order to be more competitive in the Islamic financial institution related job prospect. There is also significant
difference between the students exposed to shariah audit as a subject in the course syllabus on their perception over
the shariah concept. Understanding over shariah auditing concept would certainly boost the students’ confidence to
be part of the labour market in the IFIs in Malaysia and becoming potential successor to the existing limited pool of
shariah auditors’ talent.
6. Recommendation
Earlier findings highlighted the need to ensure the requests of the accounting students as stakeholders of Islamic
financial institution as well as institution of higher learning are considered seriously. Accounting course curriculum
proposed to impart Islamic accounting course in detail, in particular addressing the issues of shariah compliance for
some Islamic financial products. The course if not compulsory, can also be suggested to become an elective paper in
universities which does not opt to offer it as part of their course syllabus because it is highly believed students yearn
for better understanding of the Shariah related issues. Understanding over shariah auditing inculcate confidence for
the students be part of the future labour market in the IFIs in Malaysia, filling the shortage of shariah auditing related
workforce in the existing IFIs. Thus, university can play a role as the anchor party with collaboration with Islamic
Banking and Financial Institute of Malaysia (IBFIM) to provide training and formal shariah audit courses in order to
produce pool of shariah audit talent as well as catering the needs for future shariah auditor.
7. Limitation of the Study
Due to limited time frame, the study was not being able to be performed at a larger scale. Hence it managed to
cover only students from two universities i.e. Uni A and Uni B. In addition, the scope of questions posed in the
questionnaire has excluded the ‘dependent variable’ such as possible job prospect from the students’ point of view
item as part of the variable to be tested. Incorporating such variable may allow further extensive analysis such as
regression to be applied.
8. Future Research
Due to limitation of time, the researcher was unable to conduct a rigorous survey. An extension to the study so as
to include undergraduates from other discipline such as banking and shariah courses would be interesting as it may
provide useful insights especially in addressing the needs of the undergraduates as the stakeholders. Undergraduates
from other universities can also become part of the respondents especially for comparison purposes i.e. to investigate
whether there are any differences between the courses offered by different universities, thus allowing the top
management of the universities to emerge with a more integrated course syllabus. In addition, the questionnaire
maybe revised to include factors which may affect the student’s awareness and perception towards shariah auditing
concepts as well as incorporating a new dependant variable to be tested.
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No Author Title Year Population Sample Method

Awareness and attitudes of employees towards islamic banking

Keywords: Awareness; Attitudes; Employees; Islamic Banking Products

Islamic Banks in Bahrain

The Islamic Financial Products of Islamic Banks in Bahrain

The Awareness of Islamic Banking Concept

The Attitudes Towards Islamic Banking Concept

Hypotheses of the Study

Findings and Discussion

Frequency of Demographic Profile

Results of Awareness and Attitudes

The Summary of Average Weighted Mean

Instruments’ Scales Reliability and Validity

Table 1. Internal Reliability Test

Construct No. of Items Cronbach‘s Alpha

Table 2. Pearson Correlation

Awareness of Islamic Attitude towards

Awareness on Islamic Banks’ Pearson

Table 4. Independent Samples Test

Levene's Test for

Kruskal-Wallis Test – One Way Analysis of Variance

Table 5. Kruskal-Wallis Test

AGE N Mean Rank

Test Statistics a,b

Table 6. Kruskal-Wallis Test

Education N Mean Rank

Test Statistics a,b

Table 7. Kruskal-Wallis Test

Test Statistics a,b

Procedia - Social and Behavioral Sciences 58 (2012) 1131 – 1138

8th International Strategic Management Conference

Of Muslim Entrepreneurs In Malaysia

Yazilmiwati Yaacoba* Ilhaamie Abdul Ghani Azmib

eith Davis (1975) and Robert L.

2. Literature Review and Hypotheses

2.1 Fulfilling the needs of family and the weak

2.2 Performing the duties of charity

2.3 To serve the community

An entrepreneur is also responsible for the less fortunate.

2.4 Develop the community's economic strength

2.4.1 Muslim entrepreneurs as models of net economic activity

2.4.2 Responsibilities of an entrepreneur in providing employment opportunities to the community

2.4.3 Responsibility to help develop entrepreneurs in the Islamic economic system

is an important issue that needs to be emphasized by the

entrepreneurs who are used as the dependent variable in this hypothesis.

Table 1: General interpretation of the correlation

Table 3:The relationship betwe to the achievement of entrepreneurs

**. Correlation is significant at the 0.01 level (2-tailed).

Shariah audit in Islamic banks: an insight to the future shariah

* Corresponding author. E-mail address: nawal120@salam.uitm.edu.my

1.1 Unique characteristics of applying Shariah in Islamic bank (IB)

1.2 Shariah Audit Requirement in Malaysia

Fig. 1. Shariah governance framework for Islamic Financial Institutions

2.1 Human capital development

2.2 Accounting education

2.3 Students perception

4. Findings and Discussion

Table 1. Distribution of respondents by gender, race and age groups (n=351)

Uni A Uni B TOTAL

Table 3 Sources for information on shariah audit*

Table 4. Coverage of shariah audit