Need for Islamic Accounting

7/30/2019 Need for Islamic Accounting

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THENEED

FOR ISLAMICACCOUNTING: PULLFACTOR 1 THEISLAMISATION OF

KNOWLEDGE

CHAPTER 4:CHAPTER 4: CHAPTER OUTLINE: THE PULL FACTORS

In the previous chapter, the push factors for Islamic accounting were discussed.

These factors were those that made conventional accounting unsuitable for Muslim

users and Islamic organisations. In this chapter, the first category of pull factors of

Islamic accounting- the Islamisation of knowledge will be discussed. The researcher

defines pull factors as those factors that make Islamic accounting both a

theoretical and practical necessity and imperative. These factors literally pull

Islamic accounting into existence to meet the need of Muslim users and Islamic

organisations.


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Together with the push factors discussed in the previous chapter and the second

category of pull factors to be discussed in Chapter 5, they constitute the need for

Islamic accounting. This is depicted in Figure 4-1 on the next page.

The pull factors can be categorised into two groups:

The Islamisation of Knowledge factor which provides the theoretical

imperative for Islamic Accounting and

The establishment of Muslim and Islamic organisations which is the practical

imperative for the development of Islamic Accounting.

The discussion on the Islamisation of knowledge starts from section 4-1. The second

category of pull factors, the practical imperative, is discussed in the next chapter

(chapter 5).


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FIGURE 4-1:THE NEED FOR ISLAMIC ACCOUNTING: PUSH AND PULL FACTORS

UNSUITABLE CHARACTERISTICS

OF

CONVENTIONAL ACCOUNTING

NEGATIVE

CONSEQUENCES

OF

CONVENTIONAL

ACCOUNTING

INAPPROPRIATE

OBJECTIVES OF

CONVENTIONAL.

ACCOUNTING

Push Factors

THE NEED FOR ISLAMIC ACCOUNTING

Pull Factors

ESTABLISHMENT


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OF

ISLAMIC

BUSINESS AND

NONBUSINESS

ORGANISATIONS

ISLAMISATION

OFKNOWLEDGE


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In the next section, (section 4.1), Islamisation of Knowledge, which forms the theoretical basis of this project, is defined. The need for

Islamisation of Knowledge and the background to the movement towards Islamisation of knowledge are discussed. In section

4.2, the methodology of Islamisation suggested in the literature is discussed and analysed. In section 4.3, Islamisation of knowledge is

discussed in relation to general epistemological and methodological issues of research in general and the Burrell & Morgan

(1979) paradigmatic framework in particular. In section 4.4 the implication of the suggested methodology for this research is

discussed together with how this research project tries to Islamise Accounting by redefining the objectives of and proposing the

characteristics of Islamic Accounting. This chapter is concluded in section 4-5.

THE ISLAMISATION OF KNOWLEDGE

In this section, Islamisation of Knowledge will first be defined followed in the next subsection by a discussion of the need to

Islamise knowledge. This will be followed by a discussion on the history and background of the movement towards Islamisation of

Knowledge.

Islamisation of Knowledge and Islamisation.

Islamisation of knowledge has been defined by Abu Sulayman (1989) as the critical examination of modern disciplines in

the light of the vision of Islam and the recasting of them under categories consistent with that vision (p13). A broader, perhaps,

more practical definition is provided by Khalil (1995) who defines Islamisation of Knowledge as taking part in intellectual pursuits,

by examination, summarization, correlation and publication, from the perspective of an Islamic outlook on life, humankind and


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the Universe (p3). Al-Faruqi (1988) has outlined Islamisation of knowledge as the process of mastering the disciplines (as they

are) and then integrating the new knowledge into the corpus of Islamic legacy by eliminating, amending, re-interpreting and

adapting its components as the world view of Islam and its values dictate (p30). Al-Faruqi (1982) further elaborates that

Islamisation involves recasting knowledge as Islam relates to it and to achieve this the methodological categories of Islam

must replace the Western categories and determine the perception of ordering reality (p16).

Islamisation of knowledge is seen as a first step to integrate and develop the Muslim personality and outlook, which had become

schizophrenic due to the dichotomization of knowledge between secular and religious, as a result of the modern education

received by Muslims (Brohi, 1988). It has been suggested to be the ideological and intellectual backbone of the general Islamisation

process (see below) in the Muslim world (Abu Sulayman, 1994b).

Islamisation of knowledge can be seen as an integral part of the wider process of Islamisation or Islamic resurgence ,

which has been alluded to in Chapter 2. Islamisation can been seen as a reaction to the realities (and maladies) of the Modern and

Post-modern age by Muslims coming to realise that neither the Western concept of Development (Sardar, 1999) nor the traditional

methodology of interpretation of Islamic law (Abu Sulayman, 1994a) solves the problems of the Muslim Ummah. It is a reformation and

revolution in thought, which abhors the petrifaction of Islamic thought and laws. Islamists who spearhead this movement are

basically educated in the modern secular system but have come to realise their Islamic roots. Various Muslim countries in

various degrees have adopted it. In some cases as in Malaysia and Iran, it is supported by reform-minded ulemas (Islamic scholars).

The process of Islamisation is politically backed in the Islamic republics of Iran, Pakistan and Sudan, which have adopted Islam as the


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ideology of the state. In Malaysia, the substantial and economically, powerful minority non-Muslim population has prevented the

total Islamisation of the state. Hence, it has adopted a dual system mainly in the economic area and cosmetic Islamisation

through religious symbols. In other Muslim countries (such as Turkey, Egypt, Algeria and Indonesia) it is a popular movement with

political overtones but is in many Muslim countries repressed by the political system e.g. by the Kemalists in Turkey (Sayyid, 1994).

The importance of an intellectual backbone to this process of re-assertion of Islam in the Muslim Ummahs social, political,

cultural, economic, educational and other aspects of life can be seen from the partial failures in Iran which took the quick revolutionary

path to an Islamic state. Again, in the case of Afghanistan where leadership of the traditional religious educated can be the cause of

backwardness and oppression in the name of Islam. Abu Sulaymans (1994a) warning that political action and mobilisation

without sound ideas or people capable of delivering them would surely be wasted, echoes these events.

The Need for Islamisation of Knowledge- the Malaise of the Muslim Ummah.

It has been suggested that there is a need to Islamise Knowledge because there is a crisis in the Muslim mind and thought

(Abu Sulayman, 1994b) which has caused the malaise in the Muslim Ummah. It is well known that Muslims had a great intellectual,

political and military civilisation in its earliest times until the 15th Century (see for example, Sardar & Malik, 1994). However, the

Muslim civilisation today is backward in its culture, politically degraded into disunited and often warring nation states, and full of human

suffering (wars, expulsions, genocide and poverty). This is in spite of its vast human and material resources and in spite of its values

and principles. The editor of Abu Sulaymans (1994a) book entitled Crisis in the Muslim Mind has aptly summarized this dismal state of

affairs, thus:


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Poverty and injustice characterize the face of Muslim lands from the Atlantic to the Pacific. Pollution and

corruption are the order of the day in societies where the gulf between them and the developed countries have

never been wider. Politics in the Muslim world are all too often the politics of desperation, economics the

economics of deprivation, and the culture the culture of despair. (About this book-Abu Sulayman, 1994)

Various causes have been attributed to the above depressing state of affairs by the Muslims, among them the breakdown of

moral values, colonisation, political fragmentation and utter disunity. However, Abu Sulayman (1994a) gives a novel diagnosis of the

malaise thus:

It is clear that the Ummah is in no real need of resources, opportunities or values. Rather, what is lacking is

a methodology for sound thinking. Indeed, the problems of the Ummah are clearly connected to confused

thinking, obscured social vision, improper and inadequate education and the decline of its institutions in

general. The result is that it is divided and has begun to resemble an enfeebled and cringing slave.

(Abu Sulayman, 1994a, p158)

According to Abu Sulayman (1994a and 1994b), the roots of this malaise can be attributed to several historical reasons:

1) The change from consultative government to hereditary rule

Leadership during the Prophets (pbuh) time and the four rightly guided khalifs were based on consultative and elected

leadership by Companions of the Prophet imbued with the pristine values and vision of Islam. After them it decended into a

hereditary monarchy in which the rulers did not personally practice Islams pristine egalitarian values but nominally implemented the

Shariah.

2) Ossification of Islamic Law


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When political leadership passed from pious and morally upright leaders to corrupt monarchs, it gradually led to the

separation of politics from the true spirit of Islam and isolated the intellectual leadership (represented by the Islamic scholars)

from the political and administrative affairs. The divergence between the religious intellectual and the leadership led to the former

being removed from the practical and social responsibility of the Ummah. Islamic scholars retreated to the Mosque and

increasingly concentrated on purely religious and ritual aspects. Intellectual pursuits were restricted to tomes of purely

theoretical lore dealing essentially with descriptive and lexical approaches to the interpretation of the Quran and Sunnah (Abu

Sulayman, 1994a, p 26).

The Companions of the Prophet (pbuh) and the early rulers had used ijtihad1 to flex Islamic Law to meet the needs of space and

time. The later scholars (ulemas), however, in their zest to prevent the corruption and misinterpretation of the texts of the Quran

and Sunnah from being used to justify the actions of the political leadership closed the gates of ijtihad. New problems could then

onwards be only be solved through using analogy to the legal rulings of founders of the madhabs (schools of Islamic law), although

these founders themselves unequivocally declared their fallibility. This quickened the pace of stagnation of thought, although scholars

ofhigh calibre such as Imam Ibn Taymiyah and Imam Al-Shatibi continued to exercise ijtihadto the dismay of traditionalist

scholars and at considerable personal cost. However, such highly capable scholars were few and far between.

The political leaders, on the other hand, were deprived of a viable intellectual base to meet the challenge of changing times and

were short on ideas, policies and workable alternatives. This eventually led to more despotic, un-democratic regimes which

characterises Muslim society even today.

1[1] A process of continuous exertion to deduce new laws from Quranic principles


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3) Colonisation and the bifurcation of the Educational System

Henceforth, education which was monopolised by the ulemas began to mean essentially religious education. The

sciences and arts to which Muslims contributed much, decayed in the Muslim world. In addition to the internal decay in thought, the

colonisation of Muslim lands by the West, magnified the discrepancy between the Islamic worldview and its thought by its imposed

secularisation and its anti-religious scientific stance. The separation of Islam from even marginal influence in politics, law,

economics and education led to the duality in thought that govern much of Muslim intellectual activity today . The Muslim world,

despite its nominal independence from the West, retains and imitates the educational paradigm of the West. In the modern

Universities of the Muslim world, the curriculum is an inferior copy of their Western counterparts without in the least

considering the Islamic heritage and vision.

According to Al-Faruqi (1988), this universal rush of Muslims towards imitating other civilisations never reached its goal

in any field but only succeeded in de-Islamising the top layer of Muslim society and demoralizing the rest (p15). The result of

all this was:

The vision of Islam became clouded by another vision, which came to us with the colonial invaders. The alienvision survived and indeed grew more virulent after the invaders departure. For many generations, the

Muslims have been unable to get rid of it. It is evident everywhere- in the imported institutions; in the spread

of English and French languages among them; in the design of their offices, homes and cities, in the

recreational programs; in the economic and political practices they follow and in the very idea of reality, of

nature, of man and of society that they hold.(Al-Faruqi, 1988, p16)


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Al-Faruqi (1998) concludes that the bifurcated educational system into Islamic and Modern is the primary agent

responsible for disseminating the alien view. Before colonisation, the Muslims had a single education system i.e. the traditional

education or the madrasa system which produced ulemas who were learned in the religious sciences. The primary view of the world

was Islamic or religious, much like the Middle Ages. However, after the advent of colonisation, the colonisers introduced modern

subjects spearheading the use of English, French and other modern European languages. Of course, Islam had no place in such an

educational system. The religious educational establishment was deprived of state support and languished only through private

endowment. The choice positions of the state went to the graduates of colonial state and missionary schools. This bifurcated system of

education continued after independence and in time alienated the leadership and civil service from the Muslim masses who were still

religiously conscious through the efforts of the Muslim preachers (alims) of the traditional schools who sought to keep the Islamic

tradition alive.

Many Muslims attempted to reform Islamic education by adding modern subjects to its curricula, ignorant of the fact that these

subjects developed in Modern Europe were constitutive of an alien view. They assumed that the modern subjects were harmless and

could only strengthen the Muslim position. However, according to Al-Faruqi (1998) little did they realise that the alien humanities,

social sciences and indeed the natural sciences, were facets of an integral view of reality, of life and the world and of a history

that is equally alien to that of Islam (p 16).

Reactions To The Malaise


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Consistent with the categorisation of the reaction of Muslim economists to conventional economic thinking by Haneef (1995) the

reactive elements among the Muslims could be classified into:

Modernists who would like to re-interpret Islamic teachings to accord with the modern Western secular capitalist or socialist

paradigm.

Traditionalists- mainly driven by the traditional scholars or ulema (with a few notable exceptions, naively look for the

solutions to the contemporary problems of the Ummah by adhering to the fiqh (legal interpretations) of the early

generations of Muslims, and

Islamists members ofcontemporary Islamic movements who want to take the good technological developments of the

West but who nevertheless insist on a primary Islamic core.

The responses of the above three groups have been described by Abu Sulayman (1994a) as follows:

The Imitative Foreign solution- the modernists borrow solutions, which originate from the cultural (secular and materialist)

experience of the contemporary West. Solutions offered include individualism, totalitarianism, secularism, atheism,

capitalism or Marxism.

The Imitative Historical solution - the traditionalists rely on solutions derived from the Islamic historical experience

regardless of considerations of relevance in terms of time and space.


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The IslamicAsalah[1]solution- Islamists seek to apply relevant solutions, derived from authentic Islamic sources, to the

Ummahs contemporary problems.

The Islamisation of knowledge movement seeks to use the third method (Asalah) , i.e. that of providing solutions that are

relevant to the contemporary needs of the Ummah by following the original principles in the Qur an but reinterpreting its laws in relation

to space-time. It is unlike the reformation movement in the Christian and Judaic Churches in that, the Islamisation movement does not

seek to delete or amend laws or to relegate religious matter to metaphorical interpretations. It is a movement to seek a fresh

interpretation to suit the present conditions of Muslims but keeping in view the immutable principles of Islam found in the Quran and the

Sunnah.

The Quran as a basic source of Islamic Law and values was discussed in Chapter 2. From the perspective of the Islamisation of

Knowledge movement, it the source of knowledge. According to Al-Alwani & Khalil (1991), as a heavenly Revelation, the Quran is the

most reliable source for all kinds of knowledge and an authentic guide for scholars in the humanities and the social sciences.

Unfortunately, earlier generations had focussed on the formal aspects of the Quran and the hereafter and thus revelation was only seen

as a source of fiqh (derived Law) and legislation. However, Al-Alwani & Khalil (1991 p12) notes that the fiqh rulings account for only a

small part of the area covered by the Quran. In order to redress this, the authors call on Muslims to use their intellect to understand

and meditate on all the verses of the Quran, making it the primary source and basis of all knowledge in the area of human nature and

of the social and applied sciences.

[1][2] Asalah (pronounced Aah saa laah) is a comprehensive term denoting the innovative application of original Islamic priniciples to changing circumstances.Not to be confused with fundamentalism. It is derived from the Arabic root word asl which means roots. (Abu Sulayman 1994a)


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According to them the intellect should not be constrained by a limited understanding of the Quran that imprisons its meanings

in a particular period or ties it to a given generation (Al-Alwani & Khalil 1991, p11). Thus, Muslims should comprehend the Quran and

Sunnah in a holistic way, minus the time-space bound interpretations, which has somehow wrongly acquired infallible and immutable

status alongside the universal principles of the Qur an and Sunnah.

4.0.14.0.1 The Movement Towards Islamisation Of Knowledge

Muslim students studying in the Western Universities especially in the UK and the US pioneered the Islamisation of

knowledge movement. They established academic journals such as the Journal of Islamic Social Sciences to publicise their

thoughts academically. They also held International conferences (from 1977) and established the International Institute of Islamic

Thought (IIIT) in Virginia, United States in 1981. In 1982 and 1988, the Institute collaborated with the governments of Pakistan and

Malaysia, respectively, to hold international conferences on the Islamisation of Knowledge. They found political backers in the leaders of

the two countries to implement their educational projects in both these countries. Thus, the International Islamic Universities of Pakistan

and Malaysia were established. The IIIT also established branches in various countries which later led to the establishment of other

International Islamic Universities in countries such as Bangladesh, Uganda, Palestine and Sudan.

The growth of the movement can be seen from the fact that in the 1982 conference, seventeen papers were presented

focussing on Perspectives on the Islamisation of Knowledge and Islamisation of Disciplines and Islamising individual disciplines. In 1988

held in Kuala Lumpur, the conference went further into the Islamisation of the individual disciplines themselves, although the papers


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presented showed that this was a very early stage. In addition, an autonomous post-graduate research institution affiliated to the

International Islamic University, Malaysia was also established in Kuala Lumpur as the International Institute of Islamic Thought and

Civilisation which granted Doctorates and Masters degrees in the Islamic Social Sciences and Thought. The IIIT also published a

substantial number of books, occasional papers, monographs and sponsored academic dissertations.

Although the intellectual fortunes of IIIT have increased, its financial fortunes have declined, at least in Malaysia because of its

proximity to the sacked ex-deputy prime minister of Malaysia. Its branch in Malaysia has since been closed. However, Islamisation of

Knowledge has caught the attention of Muslim academics, intellectuals, students, government students and the public. Although it is at

an infantile, prenatal stage (Al-Alwani, 1995, p x) and the future is uncertain (especially in the natural sciences), it has become a

reputable intellectual activity at least among Muslim scholars. Its practical reach is in Islamic economics and banking. The researcher

hopes that this research goes some way in at least thinking about Islamising Accounting.

THE METHODOLOGY OF ISLAMISATION OF KNOWLEDGE

To the Western academic and intellectual, Islamisation of knowledge may seem to be a reactionary movement against the global

influences of Western capitalism bent on a futile attempt to substitute religious dogma for modern, objective knowledge. It is much more

than that. In fact, the process of Islamisation of knowledge may involve more of a critical examination of the Muslims own history and

method of thought rather than being just a de-Westernisation process. In fact, Al-Alwani (1995) one of the foremost scholars

involved in the project has warned against such a simplistic notion of Islamisation of knowledge, thus:


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If the Muslim mind is to liberate itself from the dominant paradigm, it must construct a methodology for

dealing with Western thought, past and present. Neither outright rejection nor wholesale acceptance of that

paradigm will avail Muslims anything. Likewise the cosmetic grafting of elements without reference to any

sort of systematic methodology, or to differences in society and culture, will contribute nothing to learning or

to humanity. (Al-Alwani, 1995, p 23)

The methodology for the Islamisation of knowledge has been outlined by its various proponents differently. For example, Abu

Sulayman (1988) has outlined it in a three-step approach involving epistemological and educational terms. Al-Faruqi (1989) has

outlined in terms of a work plan, outlining the strategic steps necessary to achieve Islamisation of knowledge. Al-Alwani (1995) has

elaborated the process in terms of six discourses and al-Khalil (1995) delineated Islamisation of Knowledge into a process which

takes place at two levels; theoretical and practical. These approaches will now be discussed briefly.

4.0.24.0.2 The Three-Step Approach

Abu Sulayman (1994) insists that there is a need to initiate a reform in three main areas in order to reform Muslim

knowledge, culture and civilization and to invigorate the Muslim character. Firstly, he calls for a rectification of the relationship

between revelation and reason. He posits that, despite the tremendous achievements of Western thought in experimental fields, the

maladjustment and imbalance in Western society is due to the inapplicability of empirical methods to mediate the conflict between the

social welfare goals on the one hand and the pursuance of personal desires and interests on the other. This is so because human


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reason alone is incapable of attaining the ultimate truth about and full understanding of that is desirable for humanity in this life and in

the hereafter (p 11).

Hence, as revelation has been rejected in Western society as a source of knowledge, it is unable to arrive at one single theory or

confidently resolve any (socioeconomic) problem. From an Islamic perspective, on the other hand, both Revelation and reason are

recognized as sources of knowledge but Muslims have a problem in defining and giving a concrete relationship between the two. In the

past, Muslims, resulting from ignorance, inexperience and a failure to use systematic reasoning have brought about deceptive and

unreasonable conclusions. On the other hand, reason has to be used cautiously within the defined purpose of existence and the

framework of revelation in a disciplined and committed spirit to enrich Islamic thought. Therefore, revelation and reason should be

harmoniously synchronized so that they are inextricably bound with one another.

An interesting example in economics is given by Abu Sulayman (1994a) to demonstrate the synchronization of revelation and

reason. Muslims have usually followed a textual interpretation of the revealed sources in developing rules for socioeconomic

life. The Prophet (pbuh) had responded negatively to intervening in the market when requested by his compatriots to do so in times of

rising prices. This Hadith was quoted as evidence to support the non-interventionist policy of Muslim governments despite

market imperfections such as monopoly and hoarding.

However, the Quran imperative of justice resulted in some ulemas such as Ibn Taymiah (see Islahi, 1988) ruling that the

government can intervene in the absence of a truly free market to protect the masses from injustice, exploitationand fraud. In such

a case, a strict following of the Prophets Hadith to absolutely prohibit a pricing system would undermine the cause of Islam, which


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preaches justice and equality. It should be remembered that the Prophet (pbuh) had set up a ethically based free market in

Medina (Kallek, 1995) in the context of which his ruling was pronounced correctly. Hence, in this instance, the Muslims arrived at

a correct decision by using reason and the ultimate principles in revelation, instead of abiding by the text of revelation detached from its

context. Abu Sulayman (1994b) concludes

This shows that the mind has been used advantageously and has proved capable of giving proper guidance in

the light of the total spirit of Islam. By realising the priority of justice in Islam, it has not been distracted by

technical theories and considerations from accepting a system that might put a minimum of checks and

controls on economic transactions.

(Abu Sulayman, 1994 b, p 13).

Secondly, Abu Sulayman (1994b) calls for redefining the Scope of Knowledge, primarily by de-centering the faqih (the

traditional Muslim scholar/jurisprudent) from monopolizing the development of knowledge. He asserts that in the past, the faqih had

been a merchant, philosopher, mathematician, physician and chemist in addition to being an expert on various branches of Islamic

Shariah. He was thus capable of directing his versatile intellectual abilities in the service of the Ummah. However, contemporary

knowledge has expanded immensely making it impossible for a single person to be the repository of even multiple aspects of a

single branch of knowledge. Thus, ijtihadhas to be undertaken by interdisciplinary specialist cadres who are specialists in a particular

field but also equipped with a first hand knowledge of the Quran and the Sunnah to give them proper insight into the morals, values and

purpose of existence consonant with Islam.


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Thirdly, Abu Sulayman (1994b) calls forthe establishment of an Islamic infrastructure and education aimed at reorienting

the programmes of education and instruction through uprooting the dualism in knowledge found at the leadership level today.

This would involve a study of major Islamic texts in each field of specialisation to mould and guide the mentality of the learner. Every

aspect of the curriculum should meet the objectives and values of the teachings of Islam in a harmoniously comprehensive manner.

This reorientation would include methodology, professional commitment and social participation in accordance with what is proper in

each field. Presumably this would include Islamisation of the various disciplines.

4.0.34.0.3 A Work Plan for the Islamisation of Knowledge

Al-Faruqi (1988), on the other hand, opines that both the traditional and modern system of education should be united.

He calls for instilling the vision of Islam in the modern universities by a compulsory study of Islamic civilization over a four-year

period to foster a sense of identity and awareness of the Islamic vision . However, he contends that this is not enough and that

Islamisation of modern knowledge (the recasting of some twenty disciplines in accordance with the Islamic vision) is the second part of

the Islamisation of knowledge process. He envisages a twelve-step work plan to Islamise knowledge, which can be distinguished into

five phases.

In the first phase, modern disciplines need to be mastered by breaking them down in categories, principles,

methodologies, problems and themes in its Western and highest form. The discipline is then surveyed to reveal its genesis and

historical development, the growth of methodology and the main contributions to the discipline. This is akin to the archeology of modern


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disciplines undertaken by Foucault (Merquior, 1991 p36). This survey would allow Islamic scholars to touch base and agree on the

identity, history, topography and frontiers of the discipline, which is the object of the Islamisation effort.

The second phase of the process would be mastering the Islamic legacy to discover what the legacy of Islam had to

say of the discipline. However, Al-Faruqi (1988) notes that this is not easily accessible to the modern scholars because the categories

of the modern knowledge are unknown as such in the legacy. The classification is not the same as the disciplines were not developed at

the time or they were treated under a holistic schema at the earlier times. For example, Zaid (1997) unearthed a wealth of accounting

information pointing to the development of a comprehensive accounting system a hundred years before Pacioli in an old

Turkish book entitled Risala El-Felakiyei (The Message of Astronomy/calculation). Similarly, economic and sociological matters

are treated under fiqh and history by Ibn Taimiyah (Islahi, 1988) and Ibn Khaldun respectively.

Al-Faruqi, suggests that the traditional scholars who are masters of the Islamic legacy be instructed in the categories

of modern disciplines produced as a result of phase one and given the task of unearthing the Islamic legacy to search for

Muslim contribution to the disciplines. This should result in the production of anthologies of the legacy, which will be used by the

Muslim scholar to analyse the legacy in relation to the historical background to crystallize the Islamic vision and to filter the time-space

constrained parts from the timeless principles.

The third phase involves the establishment of the specific relevance of Islam to the disciplines by posing three major

questions; what was the Muslim contribution to the discipline? How this contribution compares with the achievement of the

discipline and where the Islamic legacy has fallen short, in which direction should Muslim effort be exerted to fill the discrepancy,


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reformulate the problem and enlarge the vision? These questions envisage the critical assessment of the modern discipline including

the circumstances of its historical development, its methodology, its theory analyzed and tested for consistency with the principles of

Islam and an assessment of its assumptions objectives and problems. This would by followed by a critical assessment of the Islamic

legacy- not the normative nature of revelation itself but the understanding of Quran and Sunnah together with the component of the

Islamic legacy which are the products of human intellectual endeavor. It would include an assessment and criticism of the principles

provided by these sources. In addition, he suggests that a survey of the problems of the Muslim community and a survey of the

problems of Mankind be undertaken. The Wisdom of the discipline should be brought to bear on the Ummahs problems and those of

mankind for which the Muslims are responsible.

The fourth phase would involve a creative analysis and synthesis between the Islamic legacy and the modern

disciplines to bridge the gap of centuries of non-development. This would delineate the legitimate options to be followed by

Muslims to solve their problems.

The final phase of Islamisation would be recasting the disciplines under the framework of Islam. The output of this

process would result in the form of a University textbook in the discipline for the various stages of university and school education. The

textbook and other works produced during the process would be disseminated without any intellectual copyright to all Muslim thinkers

(in the discipline) and universities to be incorporated in their curriculum.


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4.0.44.0.4 Islamisation of Knowledge through discourses

Al-Alwani (1995) suggests that Islamisation of knowledge may be developed by the combined readings of the two

books i.e. that ofrevelation and the book of nature. He opines that a society which ignores the Book of Revelation (i.e. the Quran)

will lose sight of its relationship to the Almighty and its stewardship, trust and accountability to a higher authority. This results in a self-

centred and overweening society, which spins for itself a web of speculative philosophy, which is powerless to answer the ultimate

questions.

On, the other hand, those religious elements that take the first reading of revelation ignore the [SH1]existential reading of

nature and create imbalances in the form of aversion to the world and worldly pursuits. This results in their losing their ability to

participate and contribute to society and the failure to undertake their responsibilities as stewards and keepers of Allahs trust. Such a

loss of equilibrium will result in people incapable of creative and independent thinking.

Therefore, Islamisation of knowledge may be brought about by the combined readings of the two books and the establishment,

on the basis of their similarity and complementarity, of a methodology for research and discovery. Islamisation of knowledge, therefore,

is primarily a methodological issue which is pre-positioned on the identification and articulation of the relationship between revelation

and the real-existential. Al-Alwani (1995) suggests that Islamisation of knowledge should presently focus on six discourses;

4.0.4.1 Articulating the Islamic paradigm of knowledge

This is identifying and erecting a tawhid-based system of knowledge based on two fundaments:
http://www.iiu.edu.my/iaw/SHPhDHTMLfiles/Chp_04%20The%20Need%20for%20Islamic%20Accounting%20The%20Pull%20Factors.htm#_msocom_1%23_msocom_1http://www.iiu.edu.my/iaw/SHPhDHTMLfiles/Chp_04%20The%20Need%20for%20Islamic%20Accounting%20The%20Pull%20Factors.htm#_msocom_1%23_msocom_1


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1. the conceptual activation of the articles of faith to a creative and dynamic and intellectual power capable of giving adequate

replies to the ultimate questions and

2. the elaboration of the paradigms of knowledge which guided historical Islam and its school of thought to link those with the

intellectual output of the past and an evaluation of the extent to which they contributed or otherwise to the dynamism and

comprehensiveness of the output.

4.0.1.1 Developing Quranic (or Islamic) methodology

As methodology is a means of attaining truth, and a way to understand and analyze phenomena, a Qur anic methodology will

have to be discovered to enable the Muslim mind to deal effectively with its historical and contemporary problems.

4.0.1.1 Methodology for dealing with the Quran

This would include a review and re-organisation of the Quranic sciences and even possibly excluding some traditional areas of

study. This is to take account of spatio-temporal differences to the understanding of the Quran from those of a simple and limited social

and intellectual formative Arab society to the nature of contemporary civilisation. This would involve a shift from the traditional emphasis

of descriptive and lexical analysis of texts to a disciplined means of interpreting the texts of revelation and relate it to nature.

4.0.1.1 Methodology for dealing with the Sunnah


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The Sunnah of the Prophet (pbuh) serves a major source for clarification and explanation of Quranic text. At the time of the

Prophet (pbuh), this clarification was done in the particular mental, linguistic and intellectual abilities of the people he addressed.

Narrators ofHadith then preserved his actions and words.

Muslims are expected to emulate the Prophet (pbuh) as he is the best example. However, this emulation has become one of

deference or reliance on textual interpretation rather than one based on an understanding of how the Prophet (pbuh) applied the

teachings of the Quran (revelation) to real situations of his time. A methodology is therefore required which takes into consideration the

situation and context in which his actions were performed and his commands issued.

4.0.1.2 Re-examining the Islamic intellectual Heritage

There needs to be a critical understanding of the Islamic intellectual heritage to avoid the three present methods of dealing with

it; total acceptance, total rejection and arbitrary borrowing. Such an understanding would shed light on how the Muslim mind had dealt

with social and other phenomena in the past and how that mind may deal with the present. Muslims would have to discern the

objectives the Islamic heritage sought to serve and then to evaluate the methods used and the solutions suggested in order to assess

their usefulness in our own time and place.

4.0.1.3 Dealing with the Western Intellectual paradigm

A methodology needs to be constructed to deal with the dominating paradigm of Western thought in order for the Muslim mind to

liberate itself from it and to deal with it. This does not mean total rejection or acceptance of the Western paradigm of thought neither


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does it entail cosmetic grafting of elements without reference to a systematic methodology or irrespective of cultural and societal

differences.

4.0.54.0.5 The Two Processes Approach

Khalil (1995) divides the process of Islamisation into two levels, the theoretical and practical. The theoretical level explains the

dimensions, motives, aims and main stages of the process and identifies ways of implementing them in all the different areas of

knowledge (p1). According to him, this includes the collection and classification of data relevant to the contemporary Muslim situation to

define and consolidate Islamisation. The practical level is the task of reshaping every branch of human knowledge in accordance with

Islamic worldview.

Khalil (1995) also call for an examination of the link between the Islamic intellectual legacy and the Islamic view to derive an

Islamic methodology. This material has to be scrutinised and selected in order to improve accessibility of Islamic terms and details to

todays Muslims (p9). What is truly Islamic must be distinguished from the elements, which had been introduced from the outside from

the Islamic legacy. He calls for the need for a methodology to deal with the mass of knowledge in the legacy. The obsolete material

should be discarded. Such sifting, testing and classifying the legacy entails clarifying the Ummahs conceptual, civilisation and historical

roots in order to be able to eliminate the risks of starting from scratch or operating in a vacuum. Khalil (1995) also asserts that it is vital

to take modern and contemporary Islamic material seriously, since it provides the Islamisation process with experience and thought. He

notes the problem of surplus works in some areas (e.g. economics, history) while there was a dearth in many others.


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Khalil does not say much on the practical stage of Islamisation, the Islamisation of disciplines except to suggest that it will

require a long time and considerable effort. He, however, proposes that broad outlines (or basic plans) be drawn for the methodology of

Islamisation of each discipline.

A summary of the methodologies suggested by the various writers is given in the table 4-1.

Although the emphases placed by the authors are different (see table 4-1), they have many common threads. The differences

also reflect the evolutionary and gradational nature of the Islamisation project, which reflects the evolution of Islamic thought over a

period of about 15 years. Although the different proponents of Islamisation of knowledge seem to have different views, the process can

be seen to be constitutive of two elements:

(a) An evolution in Islamic thought and methodology and

(b) Islamisation of the modern disciplines.

The first phase involves a critical reexamination of the Islamic legacy of knowledge and development of a fresh

methodology in Islamic thought which seeks to integrate its history, legal and thought process as well as a new hermeneutic for the

interpretation of its basic religious texts. This process is not easy, as it would be opposed by the traditional ulema as an unwelcome

intrusion by ignorant outsiders (the modern Muslim intellectuals). However, this process is absolutely necessary and has to be

undertaken with the higher more mature and adventurous ulemas who are not narrow-minded. There are such capable ulemas in the

Muslim world who are respectful of tradition without being unduly bound by it and are in turn respected by the group of traditional

ulemas.


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The second element (which has been italicised in table 4-1), which this research is concerned with, is the Islamisation of

modern disciplines i.e. re-examining, reinterpreting and reformulating the objectives, process (including historical

development), methodology and conclusions and incorporating the vision of Islam into these components of the disciplines.

The most comprehensive methodology is that devised by Al-Faruqi (1988) in 1982, the twelve-point plan (which has been

summarised to five points in this chapter and table 4-1). This is both strategic and integrative of both the two elements listed above.

Despite this, however, detailed methods have not been forthcoming from the proponents of the Islamisation of knowledge in both

elements. What has actually happened is that short cut has taken place by initial Islamisation of disciplines by Muslim, Western

educated scholars in each field, although Al-Alwani (1995) has warned, that Islamisation of knowledge may not be pursued except by

those endowed with vast knowledge of the Quran and with it, a firm grounding in the social sciences and humanities (p13). This is a

chicken and egg situation because very few scholars (if at all) of such caliber exist. However, Islamisation of disciplines, especially

economics has proceeded because of practical developments in the economic field. Hence as Nasr (1992) suggests, Islamisation has

put the cart before the horse by jumping over the theory (Islamisation methodology) and going straight to the second practical phase

Khalil (1995) of Islamising the disciplines.

However, the researcher believes that this process is not too damaging, as long any of the output is not taken as final.

Islamisation of disciplines can be an iterative process stretching over several generations. Indeed, its proponents have recognised the

evolutionary nature of the project. The process of Islamising education is already taking place in the Islamic and other universities in

Muslim countries. Eventually, this would lead to more Islam-cognisant University graduates who will take the process further. Meanwhile


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the results can be fed to the broadminded ulemas mentioned above, who, being the Masters of the Islamic legacy would rule on the

Islamicity of the results.


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TABLE 4-1:CLASSFICATION AND EVOLUTION OF ISLAMISATION OF KNOWLEDGE METHODOLOGIES

ProponentAl Faruqi

1988

Abu Sulayman

1988

Al-Khalil

1995

Al-Alwani

1995

Category Strategic (Workplan) Methodological/Practical Theoretical/Practical Discourses

Key Steps/

Stages

Mastery of the Modern

Discipline

Mastering the Islamic legacy

Establish specific relevance of

Islam to each area of modern

knowledge

Creative synthesis betweenIslamic legacy and modern

knowledge

Dissemination, education and

application of knowledge in

socioeconomic and political lifeof Muslim Ummah.

Rectifying relationship between

revelation and reason

Redefine knowledge and clarifykey Islamic concepts such as

ijtihad (effort to develop new

rulings) and ifta (formal legal

opinion)

Reorganize and reorient the

methodology of Islamic

education and instruction to end

dualism.

Theoretical level:

Definition, aims, objectives,dimension and stages

&implementation methodologyof Islamisation of knowledge.

(theoretical construct ofIslamisation of Knowledge)

Practical level:

To reshape all branches ofhuman knowledge (humanities,

pure & applied sciences in

accordance with Islamic world

view .Islamisation of Disciplines

1) Articulating the Islamicparadigm of knowledge

2) Developing Quranicmethodology

3) Methodology for dealingwith the Quran

4) Methodology for dealingwith the Sunnah

5) Re-examining the Islamicintellectual Heritage and

6) Dealing with the Western

Intellectual paradigm


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ISLAMISATION OF KNOWLEDGE, A PARADIGM SHIFT IN EPISTEMOLOGY?

In this section, the development of knowledge in the Western civilisation is

discussed with a special emphasis on the concept of paradigms and its implication for

accounting research. The researcher then attempts to place and link Islamisation of

knowledge in the general scheme of epistemology, methodology and methods and how

this research attempts to Islamise accounting and the theoretical assumptions which

underlie this research.

Epistemology: The Development and Schools of Western Epistemology.

The problem of what constitutes knowledge, from what sources it can be derived,

whether criteria can be established on which alternate claims to truth can be validated

are still unsettled questions. For example, sceptics conclude that knowledge is

impossible as no one does know because no one can know (Dancy, 1996). These

questions are the province of epistemology, which has been defined as the theory of

knowledge and justification of belief. (Dancy, 1996). Epistemology, according to

Honderich (1995) is concerned with the nature of knowledge, its possible scope and

general basis(p 242). It deals with the sources and methods from and by which

knowledge can be obtained as well as determining criteria for evaluating and

adjudicating alternative truth claims (Chua, 1986).

Modern Western epistemology seems to have started from Descartes and

developed by Kant and others. Although Descartes and Kant, had a place for God, in

their epistemologies, after the age of enlightenment and the age of reason and science,

religion and revelation has been gradually been banished from the realms of Western

epistemology and methodology. For example, Locke argued vehemently that all our

ideas (but not all truths) arise from experience. Later, J. S. Mill extended the source of


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truth to experience only. A modern philosopher of knowledge, for example, A.J. Ayer

asserts that all knowable truths are either analytic or empirical, there is no room for

synthetic a priori views.

In contemporary Western epistemology there are two different views or schools

of knowledge i.e. rationalism and empiricism (Ryan et al., 1992). The rationalist school

of knowledge tenaciously holds that certain (true) knowledge can only be obtained

through the use of reason. This school is attributed to Plato, the disciple of Socrates. It

emphasises the power of logic and mathematics in deciding the truth of competing

theoretical arguments. According to this school, truth cannot be discerned by

observation alone but by reason. In fact, true knowledge can be obtained by

introspection, empirically a priori true propositions. Modern rationalists include Hume,

Berkeley and Locke.

The development of trade guilds in the 17[2]th to the 18th Centuries in Europe,

where knowledge and expertise were passed down from master to apprentice, required

observation and practice rather than any deep reasoning. This led to the counter

philosophy ofempiricism. The empiricist school holds that truth can only be acquired

through observation and this was the only route to certain knowledge. This school was

suspicious of the speculative method and viewed logic and mathematics, only as tools

for exploring the implications of observed knowledge. Empiricism holds that only through

perceived experience can there be certainty of belief in what we know. Sense

perception is the basis of knowledge, which can be only obtained through the five

senses. The implications of this are:

1. Beliefs based on non-experiential grounds are metaphysical and are meaningless.


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2. Beliefs about the world cannot be justified by the use of unaided reason alone, since

all knowledge is derived from experience (Lockes tabula rasa everybody is born a

clean slate on which sense impressions are laid making him/her know).

3. The natural and social sciences should be value free (from beliefs and ideologies)

which cannot be justified in terms of the objects of experience under study.

The pervasive influence of empiricism and with the scientific revolution has led to

positivism, which is the significant philosophical movement of modern times. This has

been influential in the development of economics, finance and accounting. In fact

positivism is the main constituent of mainstream accounting research (Chua, 1986;Baker

& Beltner, 1997).

This positivism took root in the United States (and spread to other human

science disciplines such as economics and accounting) in the form of structural

functionalism. Led by Talcot Parsons, structural functionalists looked at society as an

organic structure, which grows and gradually becomes complex in the relationships of

its interdependent substructures (institutions). The main job of the researcher was

therefore to discover how individual roles are related to the institutional imperative and

how developments in one substructure are related to developments in other

substructures. With this system orientation, the new sociologists justified the capitalist-

democratic system.

However, the move towards positivism and structural functionalism did not go

unchallenged. Weber opposed the earlier move towards empiricism and natural

sciences. Weber (1949, as quoted by Giddens, 1971) emphasised that in the social

sciences we are concerned with the mental phenomena, the empathic understanding of

which is naturally a task of a specifically different type from those, which the schemes of

the exact natural sciences in general can or seek to solve (p146). Weber envisioned


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sociology as a science of social action to be explained by understanding the interpretive

meanings the actor attaches to the environment. Thus, Weber contended that because

the interpretation of the actor cannot be reached by empirical observation,

experimentation or otherwise, sociology (and other human sciences) is fundamentally

distinct and different from the natural-scientific disciplines. (Ba-Yunus,1988 p 276).

Later, this interpretive approach led to phenomenology and symbolic

interactionism which focused on internal processes of thought, meanings,

rationalisations and justifications, which are supposed to be the building blocks in the

development of the visible action or act of the social actor (Bar Yunus, 1988). Akin to

this, the critical theorists were in vogue in the 1960s and 1970s and have increasingly

influenced sociology and accounting. This school, a product of German idealism and

Marxist theory of class conflict was the vanguard of the Marxist attack on conservative

positions of structural functionalism. Although Marx himself favoured scientific

methodology in his theory of dialectical materialism, the critical school moved towards

the subjective dimension in using the soft anti-empiricist methodologies in studying

human behaviour and societal conflict.

Scientific revolutions and Sociological Paradigms

It can be seen that Western epistemology, especially in the human sciences has

a tendency to take extreme positions along what is known as the subjective-objective

continuum (Burrell & Morgan, 1979; Hopper & Powell, 1985; Boland, 1989). Even in the

natural sciences, Kuhn has put forward the theory of scientific revolutions and

expounded the concept of paradigm shifts to reflect contrasting philosophical positions in

the sciences.


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The concept of paradigm, according to Kuhn (1970) represents a way of viewing

the world. Different paradigms therefore represent separate and largely

incommensurable ways of viewing the world. Kuhn asserts that scientific interpretations

of the empirical world are paradigm (or theory) laden. This theory dependence of

observation implies that observation and meaning of reality depends on our theoretical

constructs. Kuhn asserts that the world goes through scientific revolutions or paradigm

shifts where not only are there different explanations of a given reality but a fundamental

shift in the way scientists view reality. This puts the bold claim of objectivity and truth of

scientific facts and testability of scientific theories, somewhat shaky even in the natural

sciences, and more so in the human sciences such as accounting which is claimed to be

value-free, objective and unbiased.

In the human sciences, the work of Burrell & Morgan (1979) on sociological

paradigms on organisation theory has had tremendous impact on accounting research

thus:

Burrell & Morgans (1979) meta-analysis of the sociological

theories that have guided the general field of organisationalstudies also helped to reveal the functionalist assumptions that

have explicitly or implicitly guided organisational research in

accounting....Their book was an important element in the shifting

background of assumptions about social science that helped to

set the stage for more interpretive research in accounting.... The

result has been an increase in the number of roles of

accounting that are revealed as different perspectives are taken.

(Boland, 1989, p592)

Burrell & Morgan (1979) conceive social theory in terms of four key paradigms

based on different sets of meta-theoretical assumptions about the nature of social

science and the nature of society. They assert that these four paradigms are founded

upon mutually exclusive views of the social world and thus generate distinct analyses of


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social life. Thus different theories and perspectives in each paradigm are in opposition to

those generated in other paradigms.


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THE SOCIOLOGY OF RADICAL CHANGE

Radical

Humanist

Radical

Structuralist

Interpretive Functionalist

THE SOCIOLOGY OF REGULATION

FIGURE 4-2:THE FOUR PARADIGMS OF BURRELL & MORGAN (1979)

Burrell & Morgan (1979) categorise the meta-theoretical (philosophical)

assumptions which underlie the different approaches to social science as ontological,

epistemological, human nature and methodological. The different assumptions under

these categories are themselves delineated in two dichotomous dimensions, the

subjectivist and objectivist. These are displayed in figure 4-3 below:

Realism

Nominalism

SUBJECTIVST OBJECTIVIST

ONTOLOGY

Anti-Positivism

Positivism

EPISTEMOLOGY

Voluntarism

Determinism


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HUMAN NATURE

Ideographic

Nomothetic

METHODOLOGY

FIGURE 4-3:THE SUBJECTIVE- OBJECTIVE DIMENSION OF METATHEORETICAL ASSUMPTIONS

The ontological assumptions relate the essence of the phenomena under investigation

i.e. the nature of reality. In the objectivist dimension, is the realist view that there is a

reality external to the individual imposing upon the consciousness from without. This is

the ontology of realism. The Ontology of nominalism in the subjective dimension views

reality as the product of individual consciousness. The question therefore is whether

there is an objective reality or only a product of cognition.

The epistemological category of assumptions concerns the grounds for

knowledge, how the world could be understood and be communicated to others. From

the objective perspective is the epistemology of positivism where knowledge is held as

hard, real and capable of being communicated in a tangible form. From the subjective

dimension, the anti-positivist epistemological stand is that knowledge is soft and more

subjective, spiritual and transcendental kind based on experience, insight of unique and

personal nature, which can only be personally experienced.

The human nature assumption is concerned with the relationship between

human nature and the environment, which respectively forms the subject and object of


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research enquiry. From the objective dimension, the school of determinism holds that

human beings respond in a mechanistic fashion to situations encountered in the external

world. This implies that human beings are products of the environment conditioned by

external circumstances. This is the basis of much traditional management accounting

research such as social systems theory and even contingency theory which tries to find

solutions in order to manipulate human behaviour toward organisational objective

(Hopper & Powell, 1985). On the other hand, the voluntarism school in the subjectivist

dimension, holds that man is the creator of his environment (he has free will), he is the

controller and master and not a puppet subject to the ravages of the environment.

The above ontological, epistemological and human nature assumptions have

direct implications for the methodological assumptions, which underlie any piece of

research. Methodology can be seen as the way in which one attempts to investigate and

obtain knowledge about the world. Realist ontology combined with positivist

epistemology and determinist human nature assumptions would lead to a nomothetic

methodology. As these theoretical positions assume a real hard and external social

world, the nomothetic methodology seeks to analyse relationships and regularities

between various elements. It seeks to identify, define concepts, measurements, and

underlying themes, usually employing mathematical and statistical methods of

measurement.

On the other hand, an ideographic methodology reflects the assumptions of a

subjective world being capable of manipulated and interpreted by the subject. This

methodology therefore focuses on the understanding of the ways in which the individual

creates, modifies and interprets his world. The objective of research here is the

explanation and understanding of what is unique and particular to the individual rather


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than what is general and universal which is the concern of a realist, positivist ontology

and epistemology.

The above four sets of assumptions provide a powerful tool of analysis of social

theory and have led to different schools of thought in the social sciences. These include

(i) sociological positivism which attempt to apply the models and methods derived from

the natural sciences and (ii) German idealism which holds that ultimate reality lies in

subjective, spiriit/idea, rather than on ultimate data of sense perception and hence,

denies the methods of empirical science.

Burrell & Morgan (1979)s contribution is to combine these four categories of

philosophical assumptions on the nature of social science to two sets of assumptions on

the nature of society to develop their four paradigms. The two sets of assumptions

regarding the nature of society arise from the order-conflict debate of 19th century

sociologists. Conventional social theory as influenced by Durkheim, Weber and Pareto

viewed society as an ordered and cohesive system while Marx viewed society as

characterized by class-conflict and asserted this conflict as the driving force behind

social change. Burrell & Morgan (1979) develop these two views into the Sociology of

Regulation and the sociology of Radical change.

The sociology of Regulation emphasizes the cohesiveness and unity of society

and expresses a concern for the regulation of human affairs. Every society is a relatively

persistent, stable and well-integrated set of elements. Each element has a function,

which contributes to the maintenance of a system. This view of society seeks to

preserve the status quo and believes that the consensus in society is due to shared

values.

The sociology of Radical Change views society as subject to ubiquitous change

due to internal dissent and conflict. Every element contributes to disintegration and


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change. The semblance of unity is only achieved by coercion of the poor by the rich

through financial and political power. Value orientations and normative structure are

master symbols of domination. While the sociology of regulation seek to regulate human

affairs to maintain the status quo, the sociology of radical change seeks an explanation

for the radical change in the deep-seated structural conflict, modes of domination and

structural contradiction which characterizes modern society and limits its potential. The

objective is to emancipate man from the structures of society and the material and

psychic deprivations thereof.

Burrell & Morgan (1979) combined these two dimensions of society into the

subjective-objective dimensions to produce the four paradigms seen in diagram 4-1. The

four paradigms introduced by Burrell & Morgan (1979) (starting from the bottom right

corner) are termed the functionalist, interpretive, radical humanist and radical

structuralist paradigms.

According to Burrell & Morgan (1979), most of academic sociology has been

conducted in the functionalist paradigm firmly rooted in the sociology of regulation (and

from an objective point of view). Chua (1986) also opines that most research projects in

mainstream accounting are also conducted in the functionalist paradigm. This paradigm

seeks to provide rational explanations of social affairs. Its pragmatic orientation means

that it is concerned to understand society to provide useful knowledge. The functionalist

paradigm has its roots in the sociological positivism of Comte, Durkheim and Pareto.

Researchers in the Interpretive Paradigm adopt an implicit view of the sociology

of regulation because of their subjective analysis of the social world. Here the concern is

to understand the world as it is at the level of subjective experience and individual

consciousness. The researcher here is treated as a participant in the social process

as opposed to the observer view taken in an objective functionalist approach .


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Under this paradigm, the researcher sees the social world as an emergent social

process created by individuals. Social reality outside individual consciousness is viewed

only as a network of assumptions and inter-subjectively shared meanings. The quest

here is for fundamental meanings underlying social life rather than causal relationships

in social phenomena. Interpretive paradigm is the direct product of German Idealism of

Kant who emphasized the spiritual nature of the social world.

The radical humanist paradigm is concerned to develop sociology of radical

change from a subjectivist viewpoint. The social science assumptions are the same as

the interpretive paradigm i.e. nominalist, anti-positive, voluntarist and ideographic.

However, in contrast to the interpretive paradigm, radical humanists view the world as

full of social conflict due to class conflict and domination. As such theorists emphasise

the importance of over-throwing or transcending the limits of the existing social

arrangements. Hence, theorists concentrate on studying the roots of class domination

and hegemony and the ideological superstructures, which cause the alienation of man.

The object of this exercise is to emancipate the human subject from these alienating

superstructures, which drive a cognitive wedge between man and his true

consciousness. The theorists in this paradigm provide a critique of the status quo.

Unfortunately, because this paradigm is essentially founded upon Marx and his historical

materialism, the radical humanists point a finger at the spiritual (religious) bonds as one

of the superstructures which fetters the human beings into the existing social patterns

and prevent them from realising their full potential. Due to their subjectivist leanings, the

radical humanists place emphasis on the human consciousness and therefore seek to

change the social world through a change in the mode of cognition and consciousness

rather than attacking the structures.


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The Radical structuralists, on the other hand, represent the objectivist version

of the radical humanists. Both the radical humanist and structuralist view the world as

one of conflict, deprivation and domination. However, whereas, the radical humanist

seek to change the world through change in the internal consciousness, the radical

structuralist attacks the dominating and alienating external structures of the realist social

world. The theorists in this paradigm hold that contemporary society is ridden with

fundamental conflicts, which generate radical change through political and economic

crises. Theorists seek to explain the basic interrelationships (e.g. internal contradictions,

structure and analysis of power relationships) within the context of total social

transformations. Different theorists stress different social forces to explain change.

Some seek to explain change in terms of deep-seated internal contradictions in society,

while others stress the importance of structure and power relationships in society.

The Implications and critique of the paradigms.

According to Burrell & Morgan (1979), although, each of the paradigms shares a

common set of features with its neighbours on the horizontal and vertical axis, the fact

that it is differentiated on the other dimension implies it is separate from the its

neighbour. This differentiation is of sufficient importance to warrant treatment of

paradigms as four distinct and mutually exclusive, which represent fundamentally

different perspectives for the analysis of social phenomena. Thus, researchers located in

each paradigm have a different frame of reference, mode of theorising and modus

operandi but those located within the same paradigm share all these and this binds them

to the same problematic. Although theorists within a paradigm do not share complete

unity of thought, their shared taken for granted assumptions separate them, in a

fundamental way, from other theorists working within a different paradigm. They might

not even recognise an alternative view of reality existing outside their own paradigm.


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Thus to be located in a paradigm is to view reality in a particular way. It also provides a

map for locating and negotiating ones subject area.

According to Burrell & Morgan (1979):

A synthesis is not possible; since in their pure form they are

contradictory, being based on at lest one set of opposing meta-

theoretical assumptions. One cannot operate in more than one

paradigm at any given point in time by may operate sequentially

over time, since in accepting the assumptions of one, we defy the

assumptions of the other.

(Burrell & Morgan, 1979, p25)

The different paradigms may also serve as explanations for the different and

sometime conflicting conclusions arrived at by researchers looking at the same problem

but from different paradigms. Chua (1986), for example, shows how accounting

researchers working within different paradigms, use different methodologies and focus

on different matters when researching on the same area. Chua compares the work of

Chandler and Daems (1979) and Tinker et al., (1982) on the historical development of

accounting theory and practice. Chandler & Daems (1979), working from the mainstream

functionalist perspective, view accounting as a rational control mechanism which are

part of a concrete reality and which evolves in a rational manner to meet the need for

efficient organisation. The firm is viewed a rational, single-minded organic system which

adapts its accounting system to ensure its survival. There is no consciousness (by the

researcher) of intra and inter-organisational conflict except perhaps in instrumental

terms.

Tinker et al., (1982), by comparison, using a critical perspective (radical humanist

paradigm) view accounting as a discourse of the dominating forces in perpetuating the

status quo. The pretence of Accounting to be an objective, neutral discourse is exposed

and argued to be a tool actively involved in social control and historical conflict. The

development of accounting, in their view, is not a rational evolution in the quest for the


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firms efficiency and survival but a tool whose dominating discourse evolves in line with

the interest of the dominating groups in society during a particular period.

Although, the importance of the paradigms and the consequent fundamental

philosophical assumptions do have implications for accounting and research in the social

sciences, the claimed mutual exclusivity of each paradigm has been critiqued in the

literature. Hopper & Powell (1985) argue that although analytically distinct, there are

often strong relationships between the positions adopted on each continuum, which has

been integrated by Burrell & Morgan (1979) in the subjective-objective continuum.

However, in order to create their four paradigms, Burrell & Morgan created a dichotomy

between objective and subjective approaches. Hopper & Powell (1985) only recognize

three paradigms; the radical, interpretive and functionalist. They combine the radical

humanism and radical structuralist paradigms into one radical paradigm because they

argue that this is a mistaken position taken by authors (such as Althuser, 1969), who

believe in the epistemological break between the earlier and later works of Marx on

which the two paradigms are based. They point to the work of Giddens and Habermas

who have made considerable efforts to incorporate both strands. Hopper & Powell

(1985) hold that maintaining the division set up by Burrell & Morgan (1979) carry the risk

that the concern of the radical structural analysis may be seen as incompatible or

irreconcilable with those stressing consciousness, rather than seeing both as dialectical

aspects of the same reality.

Chua (1986) also finds the dichotomous division of the assumptions into

subjective and objective (the division of human nature into free will versus

environmentally determined) as problematic. She also criticises Burrell & Morgan for

embracing a strongly relativist position of scientific truth and reason through a

misreading of Kuhn (1970). Chua (1986) also points to a fundamental tension in Burrell


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& Morgans (1979) framework. While accepting Kuhns argument that there is no trans-

historical, neutral, permanent language (set of criteria) for evaluating scientific theories,

Burrell & Morgan (1979) adopt an inconsistent, non-evaluating stance and thereby

attempt the use of a completely neutral language within which the rival paradigms can

be fully expressed.

While acknowledging Burrell & Morgans (1979) contribution in breaking the hold

of a crude objectivism on accounting research, Boland (1989) criticises their posing a

dichotomy between the subjective and objective realms. He asserts that, although both

the subjective and objective are legitimate concerns, it is a mistake to suggest that there

are two different kinds of researchers. He points out that they have laid a trap for

subjectivist researchers by reifying the objective-subjective continuum as a kind of

fundamental distinction that gives a new boundary to the accounting discourse. This has

resulted in the replacement of an old mind set with a new one, which is as bad as the

predecessor.

Boland (1989) suggests that there is a need to appreciate the nature of their

(subjective-objective) union in the experience of both accounting users and researchers.

Each requires the other for context to be completed and to stand out as apart and

separate. Thus the objective fact is socially constructed and the symbolic meaning is

empirically grounded.

Boland (1989) suggests that this subjective-objective constraint can be broken by

studies, which form part of the hermeneutic turn in the social sciences. Taking a

hermeneutic turn involves a special appreciation of the close intertwining of human

action and human language embedded in a field of social practice. It means approaching

the social world as a text that is alien and unfamiliar: a text with significance and


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meaning that will emerge only through interpretation. The researcher is a reader of the

text or a reader of the way social actors read that text to themselves.

4.0.64.0.6 Theoretical assumptions of this research

This researcher takes the position of Hopper & Powell (1985) that there is no

such thing as a totally objective and value free investigation and that certain fundamental

theoretical and philosophical assumptions underlie any piece of research.

Many accounting researchers have called for researchers in accounting to

recognise and assess the underlying theoretical and philosophical assumptions behind

their research to are consistent with of their own beliefs (Tinker et al., 1982; Hopper &

Powell, 1985;Chua, 1986;Cooper & Hopper, 1990). The values to be examined include

the researchers own values and beliefs concerning the nature of society and the social

sciences.

The reason behind this call is that the researchers assert (and this researcher

agrees with them) that the method and interpretation of results of any piece of research

would depend on these assumptions, as no research is totally objective or value free.

The confusing results of research on the same area, under alternative paradigms would

become clearer if the assumptions underlying the research were made explicit.

Hopper & Powell (1985) assert that, failure to take account of the researchers

theoretical and philosophical assumptions, would make commonly held views and taken

for granted facts, which rest upon such assumptions, to be unquestioningly accepted as

fact resulting in developing and nurturing myths.

Tinker et al. (1982) assert, that two such myths in accounting are that of

pretensions of objectivity and independence. The failure to make explicit, the underlying


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normative assumptions, they assert, masks the social allegiances and biases of

accounting. This is made possible by promoting positive, descriptive and empirical

theories of what is as more realistic and factual and relevant than normative theories of

what ought to be. Tinker et al. (1982) contend that even these so called positive

theories which claim to be objective and value-free are themselves value laden and

normative. They appear to be factual and value-free because, the non-disclosure of their

underlying assumptions masks their conservative ideological bias in their accounting

policy implications.

Locating this research

This research, however, cannot be located within any of the paradigms proposed

by Burrell & Morgan (1979) because the underlying assumptions of the study do not

coincide with their social science and nature of society assumptions. The theoretical

framework and assumptions for this research is the Islamisation of knowledge, which

from the above discussion on epistemology and paradigms can be seen as a search for

an alternative epistemological paradigm located in a third dimension; the Islamic (see

figure 4-4).

According to Izetbegovic (1984), there are only three integral views of the world;

the religious, the materialistic and the Islamic each reflecting three elemental

possibilities; conscience, nature and man and each manifesting itself as Christianity,

Materialism and Islam. The religious worldview takes only the existence of spirit into

account, whereas the second worldview takes into account only the existence of matter.

Islam takes into account the simultaneous existence of spirit and matter.


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FIGURE 4-4:LOCATING THIS RESEARCH :ISLAMIC PARADIGM AS A

THIRD DIMENSION

The Islamic world-view or paradigm and the Islamisation of knowledge can be

located in a third dimension. The front face of the box represents the four paradigms of

Burrell & Morgan (using a subjectivist/objectivist approach). As the Islamic world-view is

the unity of spirit and matter, then it has to be located in another dimension. For a theory

of the nature of the social world, Islam views it as one of cycles; order to disorder and

order again; the conflict between good and evil. The class conflict can be seen as one

particular manifestation of this conflict between good and evil. The equilibrium state is

justice and the conflict state is injustice. An Islamic view would seek to remove injustice

by following its principles in the conduct of social and individual affairs and constantly

monitor empirically the state of affairs to seek to move towards justice when there is

conflict and to maintain the status quo of justice when there is equilibrium.

Another point of note is that Islamisation of accounting can be seen as part of the

interdisciplinary project in accounting (Roslender & Dillard, 1999). In many respects, the

Islamisation of accounting can be seen as a extension or modification of the critical


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accounting sub-project within this interdisciplinary project. The problem with the

interdisciplinary accounting project has already been highlighted by Roslender & Dillard,

as being too narrow a confinement within the Marxist critical paradigm which has been

superceded by other perspectives for example, Foucauldian accounting. Although,

Islamisation may have the same concern for emancipation from the status quo to a more

just system, the atheistic and overtly radical orientation of Marxism presents a problem

for the researcher to locate this research within the critical paradigm. Islam has its own

assumptions of society and social science. However, from the example of the Prophet

(pbuh) and the methodology of gradual revelation of the Quran, an evolutionary strategy

for changing society from inwards to outwards is indicated. This is also the strategy of

Islamisation of the Muslim Brotherhood (one of the earliest radical but reformist Islamic

movement) which is change through personal and family spiritual reform extending to

the local and national community and then on to the world at large. This is also the

strategy adopted by Gray et al. (1996) in the social and environmental accounting

project.

One problem which Western academics might have with the Islamisation of

knowledge as an epistemological evolution is that, on the surface, it looks as if this is an

attempt to re-introduce religious doctrine and dogma posing as knowledge.

Secularisation has pervaded Western society to such an extent that this looks like it is a

yearning for the past, a backward, retrogressive step. The secular mind finds it difficult to

understand how knowledge that should be objective and neutral could be based on the

basis of religious doctrine.

The first answer to this is that Islam should not be thought of in a Western sense

of religion. The importance of both perceptual knowledge and reason is a Quranic and

Islamic imperative. Contemporary knowledge in the garb of objectivity and neutrality is in


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fact imbued with its own religious values- that of fundamental secularism which

separates revelation from reason. According to al- Faruqi (1988), this separation of

revelation and reason is utterly unacceptable, as it is opposed to the central appeal of

the Quran to reason, to weigh rationally all matters and to favour the more reasonable,

more median course (p35). Al- Faruqi (1988) further claims that:

Unlike those religions which sought to overwhelm mans

understanding to overpower his conscience so that he would

surrender to the irrational, or even the absurd the call of Islam

was rational and critical. Invariably, it invited men to use their

intelligence; to apply their critical faculties to all claims;......and

always to seek correspondence with reality. Such exhortations,

injunctions and commands are found in practically every page of

the Quran. Without reason, the truths of revelation cannot beappreciated. (Al- Faruqi, 1988, p 35)

Further, knowledge from the Western perspective is not entirely value-fee and

empirical. Tinker et al. (1982), shows even positive theories are embedded in normative

value-laden normative origins.

Sardar (1999) alludes to the fact that that knowledge at present is not only value

neutral but also Eurocentric. He asserts that Eurocentrism is inherent in the way we

organize knowledge, in addition to i

Need for Islamic Accounting

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