Analysis of Accounting and Auditing Organization of Islamic Financial Institutions (AAOIFI) Shariah Standardization on Salam

Abstract

Unlike spontaneous sale transaction, there are certain exceptional transactions of exchange in Islamic Law of contract where the goods in future can be sold, termed as Salam and Istisna. These transactions have been standardized by Accounting and Auditing Organization of Islamic Financial Institutions (AAOIFI) in its Shariah Standards. This research paper encompasses the definition and scope of Salam and the views of scholars regarding such contracts in detailed discussion. It answers the question that what is the basis for the Standard of Salam and Parallel Salam and whether it is in accordance with the Shariah or not. Furthermore, the analysis of these transactions with regard to AAOIFI and their basis for adoption Unlike spontaneous sale transaction, there are certain exceptional transactions of exchange in Islamic Law of contract where the goods in future can be sold, termed as Salam and Istisna. These transactions have been standardized by Accounting and Auditing Organization of Islamic Financial Institutions (AAOIFI) in its Shariah Standards. This research paper encompasses the definition and scope of Salam and the views of scholars regarding such contracts in detailed discussion. It answers the question that what is the basis for the Standard of Salam and Parallel Salam and whether it is in accordance with the Shariah or not. Furthermore, the analysis of these transactions with regard to AAOIFI and their basis for adoption