Proceedings of the 3rd International Conference on Economics, Business and Economic Education Science, ICE-BEES 2020, 22-23 July 2020, Semarang, Indonesia

Research Article

Revealing the Sharia Accounting Practice at East Java MSMEs to Support Halal Business Climate

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  • @INPROCEEDINGS{10.4108/eai.22-7-2020.2307897,
        author={Dhika Maha Putri and Sheila Febriani Putri and Dian  Syariati and Imamul  Huda and Mahirah  Mahirah},
        title={Revealing the Sharia Accounting Practice at East Java MSMEs to Support Halal Business Climate},
        proceedings={Proceedings of the 3rd International Conference on Economics, Business and Economic Education Science, ICE-BEES 2020, 22-23 July 2020, Semarang, Indonesia},
        publisher={EAI},
        proceedings_a={ICE-BEES},
        year={2021},
        month={5},
        keywords={sharia accounting financial management msmes practice guidelines},
        doi={10.4108/eai.22-7-2020.2307897}
    }
    
  • Dhika Maha Putri
    Sheila Febriani Putri
    Dian Syariati
    Imamul Huda
    Mahirah Mahirah
    Year: 2021
    Revealing the Sharia Accounting Practice at East Java MSMEs to Support Halal Business Climate
    ICE-BEES
    EAI
    DOI: 10.4108/eai.22-7-2020.2307897
Dhika Maha Putri1,*, Sheila Febriani Putri1, Dian Syariati1, Imamul Huda1, Mahirah Mahirah2
  • 1: Universitas Negeri Malang, Indonesia
  • 2: Universiti Malaysia Terengganu, Malaysia
*Contact email: dhika.maha.fe@um.ac.id

Abstract

The essence of life in Islam is the condition of a person when he or she returns to God or we know as the statement of innaalillaahiwainnaailaihiraaji-uun, which means that we belong to God, and to Him, we return. Sharia accounting does not only function as an earthly instrument but also as an instrument of prayer and dhikr to awaken divine awareness. With Sharia accounting, financial management is no longer a separate element from the spiritual concept so that its practice can help one to remain istiqomah until the time of return to Allah SWT. Through the data collected by interviews and focus group discussions, this study describes the understanding and practice of sharia accounting at MSMEs in East Java. By using the information obtained from this study, it is hoped that in the future appropriate strategies will emerge to encourage MSMEs to practice sharia accounting. In fact, MSMEs don't understand much about what is sharia accounting and still find it difficult to practice it in financial management. This condition occurs because there are a very few guidelines that describe sharia accounting practices. The results of the study suggest the need for a sharia accounting practice model and guidelines according to the conditions of the MSME. The implementation of sharia accounting is believed to be able to improve the quality of MSME financial management because it is accompanied by divine awareness in every business decision.