Abstract
This research paper aims to assess the application of the AAOIFI-41 standard, governing interim financial reporting in Islamic banks, within the context of Iraqi Islamic banking institutions. The study endeavors to provide insights into the degree of compliance with AAOIFI-41. To achieve the research objectives, Data was gathered through a comprehensive survey of 30 Islamic government and private banks in Iraq, targeting authorized directors, their assistants, and accounts and audit managers. The research findings indicate a commendable 79% application rate of AAOIFI-41 in Iraqi Islamic banks. This points to a substantial level of compliance within the sector. Benefits include improved transparency, investor confidence, and alignment with international standards. However, the study also identified obstacles, including operational adjustments, resource constraints, and regulatory challenges that hinder full compliance. The findings of this study have significant practical implications for Islamic banking institutions, the central bank, and accounting and auditing professionals in Iraq. The research underscores the importance of addressing the identified obstacles to achieve full AAOIFI-41 compliance. This research contributes to the limited body of knowledge on AAOIFI-41 implementation in Iraqi Islamic banking. By highlighting the challenges and benefits of adopting the standard, the study offers valuable insights for both the Islamic banking sector in Iraq and international Islamic finance standards. It emphasizes the need for continuous efforts to enhance transparency, accountability, and Sharia compliance in the industry.
