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This study aims to examine the influence of internal and external factors on the credit risk (represented by nonperforming financing [NPF]) of Indonesian Sharīʿah rural banks (SRBs) – a type of Islamic bank that provides Islamic financial services especially to small and medium businesses in Indonesia. Internal variables comprise capital adequacy ratio (CAR), financing to deposit ratio (FDR), return on assets (ROA), operating expense ratio (OER), financing to value (FTV) and profit and loss sharing (PLS) financing ratio. External variables comprise inflation, economic growth and interest rate.

The study uses the annual reports of SRBs in Indonesia as secondary data for the years 2010–2019. Auto regressive distributed lag (ARDL) is used as the analysis method to examine the short-run and long-run relationships between the variables.

The findings indicate that four variables experienced a lag in the short run, namely, NPF, inflation, CAR and PLS, with different results recorded for each of the variables. Furthermore, the long-run results show that CAR and ROA influence the NPF of SRBs positively, whereas inflation and PLS have a negative influence on NPF. The rest of the variables – notably economic growth, interest rate, FDR, FTV and OER – do not have an influence on NPF in SRBs.

The level of NPF in SRBs exceeds the provision of the Central Bank of Indonesia. The findings are expected to have implications for SRBs and the regulator to consider and to manage the factors related to NPF properly due to the important role of SRBs in small and medium businesses’ development.

This study measures the determinants of NPF using internal and external variables, including the addition of a dummy variable, notably FTV. This study also uses ARDL to analyze the financial policies involving data at the present time and lagged time.

This study aims to examine how sharia supervisory board (SSB) characteristics are determinants of the maqashid sharia performance (MSP) of Islamic banks (IBs) and how MSP has implications for profitability and for profit-sharing investment account holders (PSIAHs).

MSP is ascertained by semi-structured interviews. The SSB characteristics measured are size, cross-membership, education level, expertise, reputation, rotation and remuneration. Annual reports of Indonesian and Malaysian IBs from 2010 to 2018 are analysed using panel data regression.

In Indonesia, SSB education level attenuates MSP, while other characteristics have only minor influence. However, in Malaysia, SSB size, education and reputation reinforce MSP, while others are ineffective. MSP in both countries is pseudo-Islamic; so their customers ignore religiosity. However, MSP in Malaysia can improve profitability because sharia assurance is more transparent; meanwhile, MSP in Indonesia cannot improve profitability because sharia assurance is less transparent.

In order for MSP to improve in Indonesia, the regulators need to increase SSB size, reduce cross-membership and arrange the format for sharia assurance in SSB reports, while IBs need to increase SSB education and expertise.

MSP is constructed in accordance with legal and social requirements to achieve IBs’ Islamic, economic, social and ethical objectives. Resource dependence theory is used to evaluate SSB, while PSIAH and profitability are investigated to demonstrate the impact of MSP. Finally, comparing SSB capabilities in Indonesia and Malaysia could be beneficial to regulatory and IB policies.

The purpose of this paper is to examine and analyze the factors that affect an auditor’s efficiency in completing the audit process proxied by audit report lag. The factors used in this study are selected by looking at the characteristics of the company and the characteristics of an auditor.

Company characteristics were proxied by the audit committee effectiveness, financial condition, accounting complexity and profitability, whereas auditor characteristics were proxied with auditor reputation, audit tenure and auditors industry specialization. Populations of this study were all manufacturing companies listed in Indonesian Stock Exchange in 2014–2016. Based on the purposive sampling method, the number of samples obtained from 231 companies was 77. Multiple linear regression method was used to analyze this study. Hypothesis testing was done by statistical t-test (partial).

The results showed that partially variables of the audit committee effectiveness and profitability had a significant negative effect on audit report lag while the variable financial condition had a significant positive effect on audit report lag. Meanwhile, variables of the accounting complexity, auditor reputation, audit tenure and auditors’ industry specialization did not show significant influence on audit report lag.

This study tests both company’s and auditor’s characteristic on audit report lag that as far as authors know never been tested simultaneously.

Qardhul Hasan (QH) is a type of Islamic contract that prioritises benevolent aspects between beneficiaries and the fund provider. The effective management and distribution of QH can contribute to overcoming economic problems in society. This study aims to explore the potential to enlarge the sources of QH funding and QH financing in Indonesian Islamic banks. The paper proposes a framework for QH management in Islamic banks by identifying the sources of QH funds as well as the management and potential allocations of QH funds.

This study uses a descriptive analysis method with a framework-based review to discuss the strategy of optimising the sources, financing and management of QH in Islamic banks. The implementation of QH in the Islamic banking industry is described based on the previous literature and current phenomena.

To positively impact economic development, Islamic banks can collaborate with parties that are more focused on charitable activities and have greater resources to channel and use QH funds. This study also formulates a framework of QH funds management that prioritises efforts to multiply benefits for both the fund provider and the beneficiaries.

The descriptive method used in this paper comprises preliminary research to analyse the current phenomena and potential strategies that can be implemented. Future studies may use empirical data to strengthen the analysis.

The recommendations of this paper can be used by relevant social fund management institutions in collaboration with Islamic banking.

QH reflects not only the social aspects of Islamic banks and extends beyond their corporate social responsibility activities, its effective management will make a greater contribution to reducing the level of unemployment, poverty alleviation and supporting the country’s economic development.

This paper provides a framework that integrates financial institutions in maximising QH fund management to encourage greater benefits for the community. Although previous studies have mentioned the important role of QH, relatively few have considered how Islamic banks maximise its management.

This study aims to examine the factors influencing the effectiveness of zakat distribution to university students. Specifically, it examines technology improvement, procedural application and governance on Sarawak university students’ zakat distribution effectiveness.

This study used the questionnaire as a research instrument and divided it into five parts. Part A gathers demographic information of respondents. Part B measures the respondent’s opinion on current technology improvement. Part C measures university students’ opinion on zakat application procedures. Part D measures the governance concept of the zakat institution. Part E measures the effectiveness of zakat distribution.

This study found technology improvement and governance significantly influence the effectiveness of zakat distribution to university students. This study provides no significant influence of the procedural application on zakat distribution’s efficacy to university students.

This study suggested that technology plays an essential role in zakat distribution effectiveness by providing faster data processing, easier retrieval of information and time reduction to complete a task. The enforcement of good governance by zakat institutions allows them to be competitive, meets the stakeholders’ demand and serves them better.

This study provides understanding to the zakat institutions in developing appropriate zakat distribution strategies and strengthening their management and governance system.

This paper integrates technology improvement, procedural application and governance in zakat distribution.

This study aims to identify and describe possible innovations available to the takaful industry in Indonesia by considering demographic characteristics and geographical conditions. Indonesia has a predominantly Muslim population, and thus, presents good potential for the takaful market.

This study uses a qualitative, descriptive, literature-based method to discuss innovation strategies in the takaful industry. This method is appropriate for reviewing particular conditions and phenomena by analysing information and data drawn from existing literature.

Market, product and process innovations are chosen as the strategies appropriate to expanding the takaful market in Indonesia. Strategies are described, which could be used to implement these innovations by influencing the community to participate in takaful, and thus, to expand the takaful market.

The innovation strategies described are adapted to the demographic characteristics of Indonesia and so cannot necessarily be generalised to other countries with different environments.

By considering customer demographic and geographical conditions, the takaful industry should choose the types of innovation that will suit the community characteristics and environmental conditions of Indonesia.

The study specifically discusses innovation strategies in the takaful industry by describing the socio-economic conditions of Indonesian society. Takaful companies in Indonesia can use the results to determine the types of innovation they pursue based on the customer demographic and geographical conditions faced.

The purpose of this paper is to examine the extent to which audit opinion, audit findings, follow-up audit recommendations, level of education, level of welfare and heads of local governments’ commitment influence the disclosure of financial statements on the official website of local government.

The data of this research comprise 68 financial statements during the period 2015–2016 collected from 34 local governments across Indonesia by employing the census method. The data then are analyzed using logistic regression.

The results of this study show that audit opinion has a positive significant influence on the disclosure of financial statements on local government websites in Indonesia, while the audit findings, follow-up audit recommendations, level of education, level of welfare and heads of local governments’ commitment have no significant influences on the disclosure of financial statements local governments’ websites across Indonesia.

The study contributes to the public sector accounting research by enhancing our understanding to the disclosure of financial statements on local government websites.

In this study, the authors seek to understand factors that naturally influence users to adopt two-factor authentication (2FA) without even trying to intervene by investigating factors within individuals that may influence their decision to adopt 2FA by themselves.

A total of 1,852 individuals from all 34 provinces in Indonesia participated in this study by filling out online questionnaires. The authors discussed the results from statistical analysis further through the lens of the loss aversion theory.

The authors found that loss aversion, represented by higher income that translates to greater potential pain caused by losing things to be the most significant demographic factor behind 2FA adoption. On the contrary, those with a low-income background, even if they have some college degree, are more likely to skip 2FA despite their awareness of this technology. The authors also found that the older generation, particularly females, to be among the most vulnerable groups when it comes to authentication-based cyber threats as they are much less likely to adopt 2FA, or even to be aware of its existence in the first place.

Authentication is one of the most important topics in cybersecurity that is related to human-computer interaction. While 2FA increases the security level of authentication methods, it also requires extra efforts that can translate to some level of inconvenience on the user's end. By identifying the associated factors from the user's ends, a necessary intervention can be made so that more users are willing to jump on the 2FA adopters' train.

Compared to low-rise and mid-rise buildings, commercial high-rise buildings have severe maintenance management deficiencies due to the complex nature of the structure and building services incorporated. Previous studies have shown that implementing lean in maintenance is a recognised prominent strategy to enhance maintenance performance. Thus, this study aims to investigate how lean maintenance can be applied to improve maintenance management in commercial high-rise buildings in Sri Lanka.

This study adopted a case study method. Three commercial high-rise buildings were selected to conduct the empirical study. An expert survey is also conducted to validate the findings.

The findings of the study revealed that out of the eight cardinal types of lean maintenance waste, six are rooted in the selected cases: (i) excessive preventive maintenance, (ii) waiting (maintenance resources, tools, procuring of additional supplies and documentation and permits), (iii) transportation due to centralised maintenance, (iv) poor inventory management, (v) poor information handling and (vi) poor utilisation of labour. Then the study revealed strategies to eradicate identified lean maintenance wastes.

The findings of this study can be used to guide maintenance practitioners in implementing lean maintenance in Sri Lankan commercial high-rise buildings. Furthermore, the proposed strategies can be directly applied to mitigate identified maintenance wastes.

This paper provides information on how high-rise commercial buildings in Sri Lanka can enhance their maintenance management by mitigating lean maintenance wastes.