In 2011, the International Accounting Standards Board (Board) conducted a consultation on topics to be included in its technical agenda. As a consequence of that consultation, the Board decided to establish a consultative group (Group) on Shariah-Compliant Instruments and Transactions.
The Group is now called the Islamic Finance Consultative Group.
The Group does not judge whether products are compliant with the requirements of Shariah law. Members are aware that there are differing views on whether particular products are compliant; however, dealing with those views is beyond the remit of the Group.
Instead, members intend to focus on challenges that may arise in the application of IFRS Standards to instruments and transactions commonly referred to as Islamic finance. The topics discussed would usually be referred to the Board’s Interpretations Committee (IFRS IC). However, the members of the Board and the IFRS IC are not skilled in the analysis of Islamic products, hence the role of the Group and others.