1. NAME OF COURSE  / MODULE ISLAMIC FINANCIAL SYSTEM
2. COURSE CODE MBA2013
3. NAME(S) OF ACADEMIC STAFF  
4. RATIONALE FOR THE INCLUSION OF THE COURSE/MODULE IN THE PROGRAMME The course is the introductory subject in Islamic finance that covers the fundamentals and principles of Islamic financial system. This course discusses the theory, concepts, principles and the importance of Islamic finance in the contemporary business environment.
5. SEMESTER & YEAR OFFERED Semester 3  / Year 2
6. TOTAL STUDENT LEARNING TIME (SLT) Face to face:

L T P O
28 23 8

L=lecture ; T=Tutorial; P=Practical; O=Others (Exam)

Total Guided and Independent Learning:

119
7. CREDIT VALUE 119/40 = 2.975 (3 credit); 2+2
8. PREREQUISITE (IF ANY) NIL
9. OBJECTIVES 1.To familiarize students with the elements of Islamic contract in the area of Islamic Finance.

2.To highlight students on the disagreements among Muslim scholars in the issues of Islamic Finance.

3.To equip students with ample knowledge to demonstrate the selected principle of Islamic Finance in ongoing dynamic and ever-changing banking industries.

10. LEARNING OUTCOMES At the end of the course, learners will be able to:

1.Explain the elements of Islamic contracts in the area of Islamic Finance (LO1-C2)

2.Discuss the various viewpoints among Muslim scholars in the issues of Islamic Finance. (LO6-EM2, P2)

3.Demonstrate the selected principles of Islamic Finance in ongoing dynamic and ever-changing banking industries. (LO7-LL2, A3)

11. TRANSFERABLE SKILLS Student should be able to develop a good understanding of fundamentals and principles of Islamic finance, the concepts and the Islamic Financial Instruments in Islamic Financial Institutions.
12. TEACHING-LEARNING AND ASSESSMENT STRATEGY Teaching-learning strategy:

·The course will be taught through a combination of formal lectures, exercise, group work, using authentic materials, informal activities and various textbooks. Collaborative teamwork will be fosters throughout the course. The use of examination and internal reporting assessment will assess the student’s ability to apply theoretical concept in context.

Assessment strategy:

·Formative

·Summative

13. SYNOPSIS This course exposes students to the principles of financing and investment in business organisations which Shariah compliant. The discussions in this course will cover the topics on interest-free businesses, zakat, Islamic financial instruments such as syirka, mudaraba, murabaha as well as the Islamic financial system.
14. MODE OF DELIVERY Lectures and tutorial (SCL)
15. ASSESSMENT METHODS AND TYPES
Component %
Continuous Assessment 50%
Final examination 50%
Total 100%
16. CONTENT OUTLINE OF THE COURSE/MODULE AND SLT PER TOPIC
TOPIC lecture tutorial Test/Quiz/Exam Assignment Assessment (Library Search) Self-study Total
Introduction to the Islamic Financial System 2 2 3 7
Overview of Islamic Economics & Financial System 4 2 6 12
Development of Islamic Financial System 4 3 6 13
Shariah Framework for Islamic Finance 8 7 10 25
Shariah Contracts for Islamic Financial Instruments 10 9 12 31
Continuous Test/Quiz/Assessment 5 10 4 19
FINAL 3 9 12
TOTAL 28 23 8 10 0 50 119
17. REFERENCES Main reference:

1.Ashraf Wajdi Dusuki, et.al. 2011. Islamic Financial System: Principles & Operations, ISRA Kuala Lumpur.

Additional references:

1. Muhammad Taqi Usmani. 2004. An Introduction to Islamic Finance. Arham Shamsi. Karachi.

2.Muhammad Ayub. 2009. Understanding Islamic Finance. John Wileys & Sons. England.

3.Sudin Haron. et. al. 2009. Islamic Finance Banking System. McGraw-Hill.

 

Mapping of the course/module to the Programme Learning Outcomes

TOPIC

Contact hours (week)

Lesson Learning Outcome CLO KI Teaching & Learning Activities Assessment Tasks
TOPIC 1:

INTRODUCTION TO THE ISLAMIC FINANCIAL SYSTEM

·The importance of Islamic Finance

·Shariah as the foundation of the Islamic Financial System

·Functions of Islamic Financial System

·Types of Islamic Financial Markets

·Islamic Financial Intermediaries

·Requisites of the Islamic Financial System

4 ·Describe the importance of Islamic Finance, its functions, and types of Islamic Financial Markets.

·Explain the requisites of the Islamic Financial System.

LO1 C2 oLecture

oTutorial

TOPIC 2:

OVERVIEW OF ISLAMIC ECONOMICS AND FINANCIAL SYSTEM

·Islamic Economics

·Objectives of an Islamic Economy

·The Central Economic Problems

·Economics of Riba

·Economics of the Financial System

·The Structure of Islamic Financial markets

6 ·Explain the objectives of Islamic Economy.

·Describe the Riba problems in the contemporary Financial System.

·Describe the Structure of Islamic Financial markets.

LO1 C2 oLecture

oTutorial

 

 

 

TOPIC 3:

DEVELOPMENT OF ISLAMIC FINANCIAL SYSTEM

·Historical Overview of Islamic Finance

·Modern Day Islamic Finance

·International Infrastructure Institutions

·Models of Islamic Finance

·Infrastructure for Development

·Challenges

7 ·Describe the development of Islamic Financial System.

·Explain the challenges in developing the Islamic Financial System.

LO1 C2 oLecture

oTutorial

TOPIC 4:

SHARIAH FRAMEWORK FOR ISLAMIC FINANCE

·Definition of Shariah

·Sources of Islamic Law

·Maqasid Al-Shariáh vis-à-vis Islamc Finance

·Legal Maxims Pertinent to Islamic Finance

·Differences (khilaf) of Opinion Among Scholars

·Role of Ijtihad and Mujtahid in Islamic Banking and Finance

·Fundamental prohibited Elements in Islamic Finance:

  • Prohibition of Riba
  • Prohibition of Gharar
  • Prohibition of Gambling

·Mutuality and Risk-sharing

·Governance and Challenges

15 ·Explain the elements of Islamic law and contracts in the area of Islamic Finance.

·Discuss the various viewpoints among Muslim scholars in the issues of Islamic Finance.

LO1

LO6

C2

EM2

oLecture

oTutorial

TOPIC 5:

SHARIAH CONTRACT FOR ISLAMIC FINANCIAL INSTRUMENTS

·Elements of Shariah Contracts

  • Form on contract
  • Subject matter of the contract
  • Contracting parties

·Classification of Shariah Contracts

  • Exchange-based contracts
  • Charity-based contracts
  • Waiving contracts
  • Partnership contracts

·Concept of Exchange-based contracts

  • Bay’Al Murabahah (Mark-up sale)
  • Bay’Al Istisna (Manufacturinf Sale)
  • Bay’Al Salam (Forward Sale)
  • Bay’Al-Dayn (Sale of debt)
  • Bay’Al-Sarf (Sale of Currency)
  • Bay’Al-Inah (Sell and Buy-Back)
  • Bay’Al-Tawarruq (Cash financing)
  • Ijarah (Lease)

 

·Partnership Contracts in Islamic Finance

  • Musharakah
  • Mudarabah

·Security Contracts

  • Kafalah (Guanrantee)
  • Rahn (Pajak gadai)

·Charitable Contracts

  • Hibah
  • Wadiáh (Deposit)

·Agency Contract : Wakalah

·Supporting Contracts

  • Hiwalah
  • Muqasah (Set-off)
  • Ibra’
  • Wa’d
19 ·Explain the elements of Islamic contracts in the area of Islamic Finance

·Demonstrate the selected principles of Islamic Finance in ongoing dynamic and ever-changing banking industries.

LO1

LO7

C2

LL2

oLecture

oTutorial