Analysis of the Effect of Sharia Supervisory Board (SSB) Function on Earning Quality of Islamic Banks

Grandis Imama Hendra

Abstract


Analysis of the Effect of Sharia Supervisory Board (SSB) Function

on Earning Quality of Islamic Banks

 

Grandis Imama Hendra, MSACC

Lecturer of Islamic Accounting, STEI Tazkia

ABSTRACT

 

Objective - This study aims to identify the effect of Sharia Supervisory Board (SSB) function on the level of earnings quality in Indonesian Islamic banks. SSB criteria used in this study are size, frequency of Meeting and educational background (Finance / Accounting).

 

Method - Panel data regression is employed to analyze the effect of Sharia Supervisory Board characteristics on the earning quality of Islamic bank. The data were taken from 11 full-fledge Islamic banks in Indonesia with available financial statements from period 2010 to 2015. 

 

Results - The size of Sharia Supervisory Board members has a positive effect on the improvement of earning quality in Islamic banking. Two other variables, namely the frequency of SSB meetings and educational background do not affect the improvement of earnings quality.

 

Conclusion - Studies of the role of Sharia Supervisory Board to the quality of financial statements is still limited, especially in the quality of earning that became the basis in determining the distribution of Islamic banks profit sharing. The main contribution in this research is that the role of SSB should be improved in order to increase the quality of financial reporting.

 

Keyword: Quality of profit, Sharia Supervisory Board (SSB), Sharia/Islamic Bank.


 


Keywords


Quality of profit, Sharia Supervisory Board (SSB), Sharia/Islamic Bank.

Full Text:

PDF

References


Abdullah, W.A.W., Percy, M & Stewart, S. (2013). Shari'ah disclosures in Malaysian and Indonesian Islamic banks. Journal of Islamic Accounting and Business Research, Vol. 4 (2) pp. 100 – 131.

Alnasser, S.A.S., & Muhammed, J. (2012). Introduction to Corporate Governance from Islamic Perspective. Humanomics. Vol. 28 (3). pp. 220-231

Anwar, M., Song, L., dan Wu, Q., (2011). Do Islamic Banks Employ Less Earnings Management. ERF 17 th Annual Conference.

Anwar, Majdi Quttainah, Liang Song & Qiang Wu (2013), "Do Islamic Banks Employ Less Earnings Management?", Journal of International Financial Management & Accounting, 24: 203-233.

Faradila, A., & Cahyati, A. D. (2013). Analisis manajemen laba pada perbankan syariah. Jurnal Riset Akuntansi Keuangan, 4(1), 57–74.

Ghayad, Racha (2008). Corporate Governance and the Global Performance of Islamic Banks. Humanomics, Vol. 24 Iss 3 pp. 207 - 2016

Grassa, R. & Matoussi, H. (2014). Corporate Governance of Islamic Banks. International Journal of Islamic and Middle Eastern Finance and Management, Vol. 7 Iss 3 pp. 346 – 362.

Hamdi, F. M. & Zarai, M. A. (2014). Corporate Governance Practices and Earnings Management in Islamic Banking Institutions.Research Journal of Finance and Accounting, Vol.5, No.9.

Khandelwal, Sunil Kumar (2009) Corporate Governance in Islamic Banking instittution. Working Paper, EFA 36 Annual meeting, Bergen, Norwey.

Mohamad, M.H.S, Rashid, H.M.A & Shawtari, F.A.M. (2012). Corporate governance and earning management in Malaysian government linked companies: The impact of GLCs' transformation policy. Asian Review of Accounting, Vol. 20 Iss: 3 pp. 241 – 258.

Mukhlisin, Murniati (2017) Bank Syariah Mau Maju Pesat? Harus Kaffah, diakses 17 April 2017https://www.hidayatullah.com/berita/ekonomi-syariah/read/2017/04/17/115050/115050.html

Othman, H. B. & Hounaida Mersni (2014), The Use of discretionary Loan loss provision byislamic banks & Conventional banks in the Middle East Region.

Rashidah, A. R., & Faisal, D. (2012). Introduction to corporate governance from Islamic perspective. Humanomics, 28(3), 220–231. https://doi.org/10.1108/08288661211258110

Rini, R (2014). The effect of audit committee role and sharia supervisory board role on financial reporting quality at Islamic banks in Indonesia. Journal of Economics, Business, and Accountancy| Ventura, 17(1), 145–156. https://doi.org/10.14414/jebav.14.170113

Shittu I., Ahmad A. C. & Zuaini Ishak (2016) Board Characteristics and Earnings per Share of Malaysian Islamic Banks. International Journal of Economics and Financial Issues, 2016, 6(S6) 135-137.

Suryanto, Tulus (2014) Manajemen Laba Pada Bank Syariah Di Indonesia: Peran Komite Audit Dan Dewan Pengawas Syariah.Kinerja, Volume 18, No.1, Th. 2014: Hal. 90-100.

Taktak, N., Shabou, R. and Dumontier, P. (2010), Income smoothing practices: evidence from banks operating in OECD countries, International Journal of Economics and Finance, Vol. 2 No. 4, pp. 140-151.

Wardhany, N., & Arshad, S. (2012). The Role of Shariah Board in Islamic Banks: A Case Study of Malaysia, Indonesia and Brunei Darussalam. Working Paper, 2ISRA Colloquium.


Refbacks

  • There are currently no refbacks.


ISSN : 1907-8145

E-ISSN : 2460-0717

Indexed by :

TIFBR is indexed by Google Scholar

Creative Commons License

Tazkia Islamic Finance and Business Review (TIFBR) is licensed under a Creative Commons Attribution-NonCommercial 4.0 International License.

 

 

View My Stats