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Advances in Social Sciences Research Journal – Vol. 12, No. 1

Publication Date: January 25, 2025

DOI:10.14738/assrj.121.18046.

Ahmad, M. A., Mohamad, A., Mohamad, A., Mohamad, N. R., & Mohamad, A. A. (2025). Determining Accounting Undergraduates'

Intention to Become Shariah Auditors in Malaysia: A Theory of Planned Behavior Approach. Advances in Social Sciences Research

Journal, 12(1). 01-10.

Services for Science and Education – United Kingdom

Determining Accounting Undergraduates' Intention to Become

Shariah Auditors in Malaysia: A Theory of Planned Behavior

Approach

Maizatul Akmam Ahmad

Institute of Professional Studies,

Universiti Poly Tech Malaysia,

Kuala Lumpur, Malaysia

Azlinda Mohamad

Faculty of Accountancy,

Universiti Teknologi MARA Terengganu,

Dungun Campus, Terengganu, Malaysia

Aznizai Mohamad

Institute of Professional Studies,

Universiti Poly Tech Malaysia,

Kuala Lumpur, Malaysia

Nor Raihan Mohamad

Faculty of Business, Economics and Social Development,

Universiti Malaysia Terengganu, Terengganu, Malaysia

Azlizan Adila Mohamad

College of Built Environment,

Universiti Teknologi MARA,

Perak Branch, Perak, Malaysia

ABSTRACT

This study investigates accounting students’ intention to become Shariah auditors

based on the Theory of Planned Behavior encompassing attitude, subjective norms,

and perceived behavioral control. It identifies the key factors influencing this

career intention. Employing data of 127 accounting students across three Malaysian

universities and utilizing analysis through Smart PLS, the study reveals that

subjective norms and perceived behavioral control significantly impact students'

intention to become Shariah auditors. These findings provide valuable insights for

universities to enhance accounting curricula and programs, ultimately fostering a

workforce proficient in Shariah principles and auditing. Additionally, the findings

of the study aid in the development of skilled and competent Shariah auditors

equipped to address the growing demands of the Islamic finance sector, thus

benefiting academia, the industry, and future practitioners.

Keywords: Accounting Undergraduates, Shariah audit, Shariah auditor, Smart PLS,

Theory of Planned Behavior.

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Advances in Social Sciences Research Journal (ASSRJ) Vol. 12, Issue 01, January-2025

Services for Science and Education – United Kingdom

INTRODUCTION

Malaysia's recent focus on the Islamic finance industry led to significant growth in banks,

financial institutions, Islamic capital markets, and standards. According to Bank Negara

Malaysia (BNM), Malaysia's Islamic banking assets reached one trillion in 2023. This effort

resulted, the market share for Islamic financing reaching 45.6% of the total banking system

financing in 2023. Malaysia adopted a dual license banking system, setting it apart from other

countries. The Malaysian government proactively supervised Islamic Financial Institutions

(IFI) by issuing the Islamic Financial Service Act (IFSA) in 2013. IFSA played a vital role in

ensuring compliance with Shariah principles and promoting financial stability. It empowered

the Central Bank of Malaysia (BNM) to oversee Islamic Finance Institutions' adherence to

Shariah principles through the Shariah Advisory Committee (SAC) and Shariah Committee (SC).

IFSA introduced rules for Shariah compliance, including the establishment of a Shariah

committee and compliance audit.

Shariah auditors play a vital role in the Islamic finance industry. Their pivotal role is ensuring

Shariah Compliance as stipulated in the institutions’ operations and transactions [1]. By doing

so, this builds up trust among stakeholders and enhances the institution’s credibility,

reputation and competitiveness in the market. Their work safeguards the integrity and

credibility of the industry while promoting trust among stakeholders. Another essential role of

Shariah auditors is mitigating compliance risks [2], strengthening the governance framework,

enhancing product development, supporting regulatory compliance [2], and promoting ethical

practices. In essence, Shariah auditor role is indispensable to the Islamic finance industry,

acting as gatekeeper of Shariah compliance and ethical practices. Their role extends beyond

compliance, contributing to the industry's reputation, risk management, and sustainable

growth. By fostering trust and transparency, Shariah auditors uphold the values of Islamic

finance and ensure its relevance in a competitive and evolving financial landscape.

As the Islamic financial industry grows, the role of Shariah auditors has become increasingly

prominent and complex, particularly in jurisdictions like Malaysia, which leads the global

Islamic finance market. The Shariah Governance Framework (SGF) introduced in 2011

transformed Shariah matters. Today, Shariah Auditing is mandatory for IFIs under IFSA 2013,

enhancing transparency and compliance. Three audits, external, internal, and Shariah, ensure

financial and Shariah adherence. The accounting industry in Malaysia offers lucrative career

opportunities, but faces a shortage of professional accountants, which affects financial

reporting accuracy. This deficit, attributed to a lack of capable universities offering professional

accounting courses, is critical, especially as auditors play a key role in ensuring trust in financial

statements. Shariah auditing, particularly in Islamic Financial Institutions (IFIs), ensures

compliance with Shariah principles and complements statutory audits, promoting fairness and

trust. However, there is a scarcity of Shariah-practicing professionals, and the education system

must adapt to prepare qualified Shariah auditors. While Shariah research and audit functions

exist, no formal certification for Shariah auditors, except from Islamic Banking and Financial

Institute Malaysia (IBFIM), is widely recognized. Low awareness of the Shariah auditor career

among accounting students, along with a lack of promotion from regulatory bodies, hinders its

growth. Collaboration between Shariah and accounting graduates, along with efforts to

promote the career, could address the shortage and enhance the field's development.

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Ahmad, M. A., Mohamad, A., Mohamad, A., Mohamad, N. R., & Mohamad, A. A. (2025). Determining Accounting Undergraduates' Intention to

Become Shariah Auditors in Malaysia: A Theory of Planned Behavior Approach. Advances in Social Sciences Research Journal, 12(1). 01-10.

URL: http://dx.doi.org/10.14738/assrj.121.18046

Hence, this study attempts to investigate the accounting student’s behaviour by utilizing the

Theory of Planned Behaviour on factors affecting intention to be shariah auditor, in order to

generate the future professional shariah auditor for Islamic financial institutions in Malaysia.

The specific study objective is to determine the factors influencing undergraduate accounting

students' intention to become Shariah auditors using the Theory of Planned Behavior (TPB).

LITERATURE REVIEW

Numerous research studies address graduates' industry skills and knowledge, including

shariah auditing in Malaysia. Skills are specific abilities developed through experience and

training. Knowledge stems from human inquiry, yet its nature remains debated. Informal

education arises from experience and observation, while formal education is acquired through

seminars, schools, and higher institutions. Knowledge is crucial, especially for employees,

ensuring credibility and competency. Though shariah auditing isn't obligatory in Accounting

programs, incorporating it enhances graduates' credibility for IFI shariah audit roles. This

enables accounting graduates to explore shariah auditing due to IFIs' mandatory shariah audit

functions, necessitating shariah auditors.

The globalization of the Islamic financial services industry has driven the need for the

development of professional Shariah auditing practices. Moreover, the paucity of statutory

auditors and Shariah Supervisory Board members to conduct a whole Shariah audit [3] also

encourages identifying gaps in the latest practices in Shariah audit. The technology in running

for the purpose of operation, involvement of people, documentation and contract, policy and

procedure should support the shariah auditing for monitoring, controlling and detecting the

shariah non-compliant risk from occurring in the product [4]. Shariah audit is also not only

established for the purpose of worldly corporate governance practice but it is a religious

responsibility of Islamic Financial Institution and Shariah auditors (muhtasib/mudaqqiq

syar’ie) [5].

Shariah auditing, although not new in Malaysia, remains largely unknown to conventional

auditors and accounting students. The lack of proper introduction, except for students in

Mua'malat and Islamic banking, hinders awareness. This research aims to make shariah audit

accessible and engaging for all, fostering more shariah auditors from diverse backgrounds.

Islamic Financial Institutions play a crucial role in establishing shariah auditing and ensuring

compliance by appointing shariah experts.

The challenge for IFIs lies in finding capable shariah experts. Scarce shariah auditors arise due

to universities mainly teaching shariah to dedicated students, not accounting ones and Islamic

accounting subjects are only elective subjects for accounting students. This results in a lack of

shariah-auditing knowledgeable auditors. Currently, shariah auditing is dominated by shariah

graduates without auditing backgrounds. Universities must integrate shariah knowledge into

accounting curricula to prepare capable accounting students for shariah auditing roles.

Shariah Auditing in Malaysia

Shariah audit systematically acquires objective evidence to evaluate whether a subject, like

financial statements, complies with Shariah laws [5]. The Shariah Governance Policy Document

(2010) defines it as an independent assessment, enhancing compliance through effective

internal control systems [6]. Shariah governance, vital for corporate governance in Malaysian