Management Accounting from an Islamic prespective

Essay by Rashad871University, Bachelor'sA, March 2005

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Introduction 2

The Process Of Decision Making 3

Shura 4

Ethics And Decision Making 6

Resolution Of Ethical Conflict 8

Blaming The Wrong On Others 10

Truthfulness 12

Continuous Improvement 14

Accountability 17

Conclusion 19


Islam is a religion, which is proclaimed by Prophet Mohammad (s.a.w) with the revelation and permission of Allah (s.w.t) fourteen centuries ago. The divine guidelines outlining all the aspect of human behavior were conveyed to the people through the Prophet (s.a.w). Through such divine guidance, the Prophet (s.a.w) himself became one of the finest example that human can ever see.

The aim of this paper is to explore the relationship between management accounting and the Islamic concepts. The Islamic concepts discussed will be taken from Quran, sunnah and opinions from Islamic scholars. Several views, such as the process of decision making, ethics during decision making, truthfulness, etc. of management accounting will be discussed in this study.

The paper will further highlight what the modern management accounting prefers during controversial situations and the Islamic perspectives on such instances or the Islamic ways of problem solving.


According to Daft (2003), decision making is the process of identifying problems and opportunities and then resolving them. He further saying, this process involves efforts both before and after the actual choice. Robbins and Coulter maintains a decision is based on the choice made from two or more alternatives . Daft argues that effective decision making often depends on whether managers involve the right people in the right ways in helping them solve problems. One model that provides such a style is called leadership participatory styles. Hilton (2000) identifies the six process involved in making decision.

1. Clarify the decision making problem

2. Specify the criterion

3. Identify the alternatives

4. Develop a decision...