Shariah Advisory
Competency Title:
Shariah Advisory
Competency Type:
Functional
Competency Description
The competency refers to the ability to provide expert advice on Shariah compliance when creating, offering, or issuing products and services in the Islamic capital market (ICM). The scope includes evaluating the product and services against ICM regulatory requirements, providing Shariah opinion with justification, issuing shariah pronouncement, and applying independent legal reasoning (ijtihad) in absence of specific ruling from the relevant shariah authorities
Level 1 - Awareness
Level 1
• Identify factors that determine the shariah compliance of capital market products, services, and business activities
• Identify the regulatory requirements for Islamic Capital Market products and services
• Identify associated risks in offering Islamic Capital Market products and services
• Identify Shariah non-compliance risks in capital market activities
Level 2 - Knowledge
Level 2
• Explain the Shariah principles and concepts pertaining to capital market products, services, and business activities
• Outline the rules and regulations applicable to providing Shariah advisory in Malaysia
• Outline the risk management approach to ensure Shariah compliance of products, services and business activities
• Recognise the role of Shariah advisers in managing Shariah non-compliance risks
Level 3 - Skill
Level 3
• Review capital market products, services, and business activities against Shariah and regulatory requirements
• Apply rulings endorsed by SC SAC to form opinion on Shariah compliance of capital market products, services, and business activities
• Conduct risk assessment and on-going review of products, services, and business activities against Shariah and regulatory requirements
• Conduct assessment on business activities to identify Shariah non-compliance risks
Level 4 - Mastery
Level 4
• Justify Shariah compliance of capital market products, service, and business activities through issuance of Shariah pronouncement
• Determine Shariah compliance of capital market products, services, and business activities through ijtihad (intellectual reasoning)
• Appraise level of risk mitigation/controls based on Shariah review and Shariah audit findings
• Validate assessment on Shariah non-compliance risks and recommend appropriate mitigation/controls mechanism
Level 5 - Expert
Level 5
• Evaluate effectiveness of internal policies and procedures in assuring Shariah compliance of products and services
• Review the adequacy of framework to guide assessment of products and services against Shariah and regulatory requirements
• Review the adequacy of framework to guide assessment and audit report of business activities against Shariah and regulatory requirements
• Evaluate to confirm policy and procedures to ensure shariah non-compliance risks are effectively managed