Topic 2 - Revised Shariah Screening Methodology - CLASS - NOV2018)
Topic 2 - Revised Shariah Screening Methodology - CLASS - NOV2018)
Topic 2 - Revised Shariah Screening Methodology - CLASS - NOV2018)
• Securities Commission
– Islamic capital market
– Shariah Advisory Council
Securities Commission
The SC was established on 1 March 1993 under the Securities
Commission Act (SCA)1993
The SAC was given the mandate to ensure that the running of
the Islamic capital market (ICM) complies with Shariah
principles.
The objective of
screening is to ensure
A process of stock or security that
determining one purchase or invest
whether stock is does not contain any
Shariah compliant prohibited elements
or not. that make it Shariah
non compliant.
Evaluation Process by SAC
Announcement
Report
Presentation
Evaluation &
Report
Preparation
Data
Collection
1: Data Collection
The SAC receives inputs and
support mainly from the SC
• The SC gathers information on
companies’ activities from various
sources such as annual financial reports,
and published information in magazines,
newspapers and KLSE references.
• Apart from that, the SC also conducted
surveys and interview sessions with
respective companies’ managements.
2: Evaluation & Report Preparation
http://www.sc.com.my/frequently-asked-questions-on-revised-shariah-screening-
methodology/
FAQs On Revised Shariah Screening Methodology
(a) Companies with mixed activities which are currently assessed under
the 10% or 25% benchmarks may be affected because their activities are
now assessed under the 5% or 20% benchmarks.
Example:
(b) Companies with high level of conventional debt may be affected
as currently there is no screening based on the total conventional debt
of the company.
Example:
5. When is the effective date?
Total assets :
368.00
Benchmark Limit
(Imposed by
SAC, SC)
1) GROUP T/OVER (a) (b)
RM250,000,000
b) % of Hotel & Resort
Operations RM55,000,000 22% 20%
RM250,000,000
2) GROUP PBT
Compliant Non-Compliant
(Approved) (Disapproved)
Securities Securities
Timing for Disposal
Disposal DURING the announcement
is made
A B C D
March 17 RM 5.50 NA NA