The development of Islamic economics is not only seen from the financial side but also from the education side. This is evident from the many higher education institutions that present study programs based on Islamic economics such as Islamic economics, Islamic banking, Islamic accounting and so on.
Not only in the form of study programs, institutions that label themselves as higher education institutions in Islamic economics have also emerged. Two well-known institutions namely the College of Islamic Economics (STEI) Sebi and STEI Tazkia.
One branch of sharia economics which is again highlighted is about sharia accounting and in this article will be discussed about it.
Understanding and Arguments of Islamic Accounting
Islamic accounting is accounting based on sharia or in other languages sharia influences the world of accounting. In Arabic, accounting comes from the word Al-Muhasabah which is a mashar from the word hassaba-yuhasbu which means to count or measure.
The command to take notes is in the QS. Al-Baqarah verse 282 which is the longest verse in the Qur’an.
The basic principles of sharia accounting are based on Al-Baqarah verse 282. The details of these principles are three of them:
1) Responsibility Principle, namely that individuals involved in business practices must always carry out the responsibilities realized in accounting reports.
2) the principle of justice, which is related to moral practices and fundamental things.
3) The Principle of Truth, which is inseparable from the principle of justice. The truth in question is the truth contained in the Qur’an. This means that accounting is not based on lust alone.
Conventional and Islamic Accounting Equations
The equation between sharia and conventional accounting is as follows:
1) The principle of separating financial guarantees from the principles of economic units.
2) The principle of hauliyah with the process of time period or financial accounting year.
3) Principle of direct bookkeeping with dated records.
4) The principle of testimony in bookkeeping with the principle of determining goods.
5) The principle of muqabalah (comparison) with the principle of comparison of income with cost.
6) The principle of istimrariyah (continuity) with the sustainability of the company.
7) Taudih principles (information) with explanation or notification.
Differences in Conventional and Sharia Accounting
The differences of the two accounting systems according to Husein Syahatah are as follows:
1) Modern accounting experts differ in their opinions in determining value and goods to protect the principal capital goods, while it is unclear and has not yet determined what is meant by the principal capital (capital), while Islam uses the concept of valuation based on the prevailing exchange rate with the aim of protecting the principal capital in terms of future production capabilities.
2) In conventional accounting, capital is divided into two categories namely fixed capital (fixed assets) and circulating capital (current assets), whereas in Islam in the form of goods or stock, hereinafter referred to as property and merchandise.
3) Islam values money like gold, silver and other similar items only as intermediaries for the measurement and determination of value or price.
4) Conventional accounting practices the theory of reserves and self-accuracy bears all losses in calculations, as well as ignoring possible profits, while Islam pays attention to it by determining the value or price based on the prevailing exchange rate and establishing reserves to allow for danger and risk.
5) Conventional accounting applies the principle of universal profit, including money from sources that distinguish between profits from principal activities and profits from capital (principal) from those from transactions. While sharia accounting is also required to explain illicit income if any and try to avoid illicit funds and may not be shared with business partners or mixed with the principal of capital.
6) Conventional accounting uses profit that it will be there when there is buying and selling, while Islam uses the profit principle that it will be there when there is a development and an increase in the value of goods whether sold or not.
That is the explanation related to the understanding and similarities and differences about Islamic accounting. From these explanations it can be seen that Islamic accounting is not a branch of science as long as it exists, it was born because of the existence of a foundation and some differences with conventional