KPMG AND CIMA have drawn attention to the burgeoning field of Islamic finance of late, as the firm has appointed a new global head and the institute today launched a new qualification.
The primary difference between Islamic finance and its western counterpart is that, under Shariah law, earning interest is illegal. To get around this, complex structures are put in place that allow lenders to profit from their capital; this can be problematic in western markets, though, because products are often penalised by tax regimes.
CIMA’s advanced diploma was launched today at the IFN 2011 Europe Forum, which welcomed 750 participants over the two-day event. Organisers heralded it as the largest annual Islamic finance event in Europe and CIMA has pitched its new qualification as a “truly global product” to meet a gap in the industry.
The institute said that more than 50,000 professionals will have to enter the market within the next seven years if growing demand is to be met, claiming the qualification is “tailored to the evolving needs of the market as it moves from niche to financial mainstay”.
Following the launch of its certificate in Islamic finance four years ago, CIMA has re-graded the qualification to a diploma, on which leadership and development specialist John Willsdon said: “Our qualification offers international recognition by the industry as an alternative to the regional qualifications available in isolated geographies. We see the Islamic finance market as particularly important, with its current global value estimated at more than $1.1tn (£6.8bn), and our aim is to provide appropriately trained human capital to sustain the industry’s continued growth.”
KPMG’s appointment of a new global head of Islamic finance indicates that the firm is also eyeing the expanding market.
Neil D Miller was formerly head of Islamic finance at law practice Norton Rose, having spent five years in Bahrain. He said: “To prosper and grow, the Islamic financial industry needs to be served by firms that can deliver well-researched and designed tools that are Shariah-compliant and commercially viable; [it must] also comprehensively consider taxation, audit and accounting perspectives.”
Clare Hartnell, Grant Thornton’s global head of property and construction, recently told Accountancy Age that it is “incredibly important to understand the system”, but admitted the firm receives a limited amount of Islamic finance-related business.
This could be set to change as the CIMA qualification, coupled with KPMG’s new recruit, could mark a step change in the practice of Islamic finance for UK firms.
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