View source for Considerations for Implementing Musharakah in Microfinance b



== Top 20 FREQUENT WORDS ==
musharakah 10
profits 7
ratio 7
shirkat 7
cash 6
accounting 5
basis 5
daily 5
amount 4
partner 4
partners 4
techniques 4
arrangements 3
based 3
business 3
closing 3
commercial 3
distributed 3
distribution 3
estimated 3
ethics 3
inventory 3
investment 3
losses 3
moral 3
movement 3
obtain 3
opening 3
participants 3
required 3



== DOCUMENT KEY POINTS ==
*shirkat ul aqd i types if shirkat ul amwal a all participants invest some amount of capital in a commercial enterprise
*if shirkat ul wujooh a no investment required commodities purchased on deferred payment basis and sold at spot

*losses i losses must be shared in the ratio of capital invested unlike profits where ratio may be greed upon
*i normal principle is that every partner has a right to take part in management

*termination i musharakah shall be terminated as follows i by giving notice to all other partners

*i capital may be valued at the beginning and end of period and profits distributed in agreed ratio
*i sleeping partners share cannot be more than his proportion of investment

*ethics and morals i challenges cont if regulatory issues pursuit of default cases is time consuming and costly
*if cash based economy no verification or recording of transactions through the banking channels

*knowledge of the business i obtain understanding of the different sectors by conducting sector studies and market research
*i obtain historical perspective of level of earnings of the musharakah participants

*accounting techniques i activity based estimation in absence of detailed accounting systems and records
*i business operations are generally entirely cash based with low capital requirement

*daily movement of inventory i a simple form designed to show opening and closing inventory together with movement on a daily basis
*i form should include sale and purchase prices i banks obtain copy of form daily and conduct surprise physical counts periodically

*i sales can be estimated by adjusting for opening and closing inventory
*payment for carriage i amount paid will indicate number of trips made

*cash reconciliation i reconcile movement of cash to opening and closing balances on a daily basis
*i a simple form can be designed and used daily to summarize cash movements

*remarks i the entity should examine problems currently being faced in microfinance as the type of customer and creditworthiness are likely to be same
*i similar conditions may prevail under musharakah arrangements and may require similar solutions

*remarks cont i the ability of businesses to meet financial obligations under musharakah arrangements is enhanced as partner owner is required to share in profits earned
*i as this is more attractive to businesses banks are likely to build large musharakah portfolios in a short time


 ''Please note, This is an auto generated summary based on sentances position in the document and other factors''
== DOCUMENT WORD ANALYSIS ==
=== Main Category ===
: AlHuda Material\islamic micro


=== KeyWords ===
islam finance bankable contract client profit purchase financial asset microfin risk sale transact price murabahah busi sharia goodasset payment invest



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== DOCUMENT REFERENCES ==


=== Number of Pages ===
21


=== Published Date ===
2016-09-17 00:47:11


== Full Document ==


[http://45.40.136.134/~hodhood/HodHoodDocuments/IslamicFinance/IslamicMicro/Considerations%20for%20Implementing%20Musharakah%20in%20Microfinance%20b.pdf Read the Full Document]


[[Category:Islamic Finance]]

[[Category: Islamic Micro]]