Islamic banking takaful finance test 2 BA2241 2024

Which of the following is true?

• •Takaful - Arabic word originating from the root verb kafalah –to guarantee, to secure or to be responsible for others

• •Takaful - Arabic word originating from the root verb kafala –to guarantee, to secure or to be responsible for other

• •Takaful - Arabic word originating from the root verb kafa –to guarantee, to secure or to be responsible for other

• •Takaful - Arabic word originating from the root verb falah –to guarantee, to secure or to be responsible for others

Which of the following is true

• AAOIFI defines Sukuk as:                                                            Certificates of equal value representing divided shares in the ownership of tangible assets, usufructs and services or (in the ownership of) the assets of particular projects or special investment activity (AAOIFI 2008, p. 307)

  The IFSB defines Sukuk in its Capital Adequacy Standard (IFSB-2) as ‘certificates that represent the holder’s proportionate ownership in an undivided part of an underlying asset where the holder assumes all rights and obligations to such asset’

• AAOIFI defines Sukuk as:                                                            Certificates of equal value representing undivided shares in the ownership of tangible assets, usufructs and services or (in the ownership of) the assets of particular projects or special investment activity (AAOIFI 2008, p. 307)

  The IFSB defines Sukuk in its Capital Adequacy Standard (IFSB-2) as ‘certificates that represent the holder’s proportionate ownership in an undivided part of an underlying liability where the holder assumes all rights and obligations to such asset’

• IFSB defines Sukuk as:                                                            Certificates of equal value representing undivided shares in the ownership of tangible assets, usufructs and services or (in the ownership of) the assets of particular projects or special investment activity (IFSB 2008, p. 307)

  The AAOIFI defines Sukuk in its Capital Adequacy Standard (IFSB-2) as ‘certificates that represent the holder’s proportionate ownership in an undivided part of an underlying asset where the holder assumes all rights and obligations to such asset’

• AAOIFI defines Sukuk as:                                                            Certificates of equal value representing undivided shares in the ownership of tangible assets, usufructs and services or (in the ownership of) the assets of particular projects or special investment activity (AAOIFI 2008, p. 307)

  The IFSB defines Sukuk in its Capital Adequacy Standard (IFSB-2) as ‘certificates that represent the holder’s proportionate ownership in an undivided part of an underlying asset where the holder assumes all rights and obligations to such asset’

Name 3 models of corporate governance

• Franco-Italian

  Anglo-American

  Islamic Paradigm

• Franco-German

  Anglo-Saxon

  Islamic Paradigm

• Franco-German

  Anglo-American

  Islamic Paradigm

• Franco-German

  Anglo-Spanish

  Islamic Paradigm

AAOFI identifies the following methods (alternatives) of allocating takaful surplus 

• Allocation of surplus only among policyholders who have not made any claims during the financial period  

• non of the options given

• Allocation of surplus between policyholders and shareholders

• Allocation of surplus between policyholders and stakeholders

The IIRA identified the following eight major rating products:

• -  Sovereign Ratings                                                      -  Issuer Ratings                                                                       -  Bond/sukuk Ratings                                                    -  Debt Financial Strength Rating                                         -  Banks Financial Strength Rating                                           -  Sharī'ah Quality Ratings                                                     -  Corporate Governance Ratings                                                                              -  Real Estate Ratings

• -  Sovereign Ratings                                                      -  Issuer Ratings                                                                       -  Bond/sukuk Ratings                                                    -  Insurer Financial Strength Rating                                         -  Banks Financial Strength Rating                                           -  Sharī'ah Quality Ratings                                                     -  Personal Governance Ratings                                                                              -  Real Estate Ratings

• -  Sovereign Ratings                                                      -  Issuer Ratings                                                                       -  Bond/sukuk Ratings                                                    -  Insurer Financial Strength Rating                                         -  Banks Financial Strength Rating                                           -  Sharī'ah Quality Ratings                                                     -  Corporate Governance Ratings                                                                              -  Real Estate Ratings

• -  Sovereign Ratings                                                      -  Issuer Ratings                                                                       -  Bond/sukuk Ratings                                                    -  Insurer Financial Strength Rating                                         -  Banks Financial Strength Rating                                           -  Sharī'ah Quality Ratings                                                     -  Corporate Governance Ratings                                                                              -  Estimated Estate Ratings

According to IFSB, about corporate governance

• •No single model of corporate governance that works well for every country and all types of business

• •Good governance in securing/preserving public confidence in takaful undertakings necessitated the development of separate guidelines for the takaful industry

• Islamic model of corporate governance that works well for every country and all types of business

  •Good governance in securing/preserving public confidence in all undertakings necessitated the development of separate guidelines for the takaful industry

• Islamic model of governance is good only for Islamic financial institutions

What does IIRA stand for?

• Islamic International Rating Authority

• Islamic Institution Rating Accreditation

• Islamic International Rating Agency

• Islamic Institution Rating Agency

Objectives of the IFSB Guiding Principles on Governance for Takāful (Islamic Insurance)

• • To provide benchmarks for use by Takāful supervisors in adapting/improving regulatory regimes or establishing new ones

  • To address regulatory issues, e.g. risk management and financial stability for the Takāful industry

  •

• • To provide appropriate levels of consumer protection in terms of risk and disclosure

  • To support the orderly development of the Secuity market

• • To provide appropriate levels of consumer protection in terms of liquidity and accountability

  • To support the orderly development of the Takāful industry

• • To provide appropriate levels of consumer protection in terms of risk and disclosure

  • To support the orderly development of the Takāful industry

• The Sharī‘ah Board is to produce a Sharī‘ah report periodically or   annually to explain its position on:

• -The overall business and products of the IFI

  fatwa on matters brought before the board

• -The overall business and products of the IFI

  nonfatwa on matters brought before the board

• -The specific part of the business and products of the IFI

  fatwa on matters brought before the boards

• none of the options given

The two popular classifications of bonds while rating their quality are:

 

• ‘investment grade bonds’                                         

•  - ‘junk bonds’

•   ‘covalent bonds’

•  -  ‘shariah bonds’