Fatwa ID: 07066
Answered by: Mufti Mohammed Dilwar Hussain
Question:
Would it be permissible to take up a job as a fund accountant, considering that the job description is as described below:
A fund accountant provides accounting for an investment portfolio. The investments needed include commodities, securities, and/or real estate in an investment fund like a hedge fund or mutual fund.
The role of fund accountants includes activity capturing and recording. Fund accountants prepare accurate and timely values, distributions, yields, and fund accounting output for review. They manage activities associated with fund accounting and domestic equity transactions. Also, they work alongside supervisors when it comes to budget development.
FUND ACCOUNTANT RESPONSIBILITIES:
Here are examples of responsibilities from real fund accountant resumes representing typical tasks they are likely to perform in their roles.
Manage fund accounting activities for five funds for an investment manager with $80b in AUM.
Manage processing of mutual funds consisting of equity, bond, and money market securities and release daily prices to NASDAQ.
Manage accounting transition from Quickbooks to Yardi.
Manage complex pricing structure and maintain SalesForce CRM funnel for forecasting accuracy.
Prepare annual and semi-annual financial statements using GAAP.
Work with supervisors in budget development, AUM forecasting.
Research and analyse different assets using the BloomBerg terminal to provide an explanation for changes within the asset.
Review various types of securities: equities, mortgage-backed securities and derivatives: futures, swaps, options.
Calculate daily P/L and NAV for diversify portfolios consisting of futures, FX forwards, options and European equities.
Process sales and purchases of various investment securities within each mutual fund account including stocks, bonds and futures.
Identify and evaluate FX exposures at a consolidate and subsidiary level.
Advise management and colleagues by answering technical questions about custody reporting procedures and policies.
Advise executive management regarding modification and/or development of accounting systems, methods and procedures.
Apply accounting procedures or conduct procedural studies to analyse and solve accounting problems involving information systems.
Utilize GAAP to efficiently analyse, research, and ensure appropriate reconciliations surrounding investment activity/data, i.e.
Ensure accuracy of all fund activity and investigate and resolve discrepancies between accounting records and custody records.
Document audit/internal controls and recommendations for safeguarding company assets in addition to periodic testing for Sarbanes-Oxley compliance.
In the name of Allāh, the Most Gracious, the Most Merciful
Answer:
The fact that you are concerned about where your earnings are accrued from is praiseworthy. It makes evident your consciousness of Allāh Ta’ālā and your desire to obey Him. The Prophet ﷺ said that earning a halal income is an obligation beyond other obligations. [Shu’bul Iman lil Bayhaqi: Hadith 8367] [1]
Allāh Ta’ālā also commands: “do not aid in sin.” [Surāh Mā’idah, 5:2] [2]
Furthermore, the Prophet ﷺ has said “A time will come when one will not care how one gains one’s money, legally or illegally.” [Sahih Bukhari: Hadith 2059] [3]
“Whosoever fears Allāh (by abstaining from sins and fulfilling his obligations) Allāh will open up ways for him out of every difficulty. Allāh will provide sustenance for him from such avenues which he least perceives. Whoever places his trust in Allāh, Allāh will suffice him. Indeed, Allāh will accomplish His purpose. Allāh has already set a measure for all things.” [Surah at-Talaq; 65:2-3] [4]
The Prophet ﷺ said that “Do not delay (in earning) sustenance, for the servant will not die until his last provisions reach him. (So) take what is Halāl and leave what is Harām.” [Sahih Ibn Hibbān: Hadith 3239] [5]
These are reminders for us that our earnings have already been fixed by Allāh Ta’ālā. Now, whether we choose to receive these earnings through Halal means or Haraam is upto us. One way or another, whatever has been destined for us will reach us.
Nonetheless, it is upon us to go out and actively seek a Halal means of earning and then we place our trust in Allāh Ta’ālā to grant it to us. This has always been the method of Allāh Ta’ālā, that is, that we first have to make an effort and then Allāh’s aid will reach us.
With banks, the greatest concern is in regards to usury/interest.
Allāh Ta’ālā has admonished us greatly in this regard;
“Those who consume ribā (usury/interest) cannot stand (on the Day of Resurrection) except as one stands who is being beaten by Satan into insanity. That is because they say, “Trade is (just) like interest.” But Allāh has permitted trade and has forbidden interest. So, whoever has received an admonition from his Lord and desists may have what is past, and his affair rests with Allāh. But whoever returns to (dealing in interest or usury) – those are the companions of the Fire. They will abide therein eternally. Allāh destroys ribā and nourishes charities, and Allāh does not like any sinful disbeliever.” [Surah Al-Baqarah; 2:275-276] [6]
Allāh’s Messenger ﷺ cursed the accepter of interest and its payer, and one who records it, and the two witnesses, and he said: They are all equal. [Sahih Al-Muslim; Hadith 1598] [7]
The Messenger of Allāh ﷺ cursed the one who accepted usury, the one who paid it, the witness to it, and the one who recorded it. [Sunan Abi Dawood; Hadith 3333] [8]
A person’s work can primarily be broken down into two parts; the actual work that they do and the company’s source of revenue which is used to pay their wages/salaries.
For instance, if a person was to work as a cashier, manager, clerk, and etc. where they would be directly involved in the interest/usury which banks are involved in, whether witnessing it, drawing up the contracts, collecting interest payments and etc. These things would make one’s actual work Harām.
To determine whether one’s income will be Halāl will require investigating how the company operates and generates its income.
Typically, working in commercial banks in any form would not be permissible. However, this generally is not the case for investment banking.
Some of the key differences between the two are that; Commercial banks accept deposits, make loans, safeguard assets, and work with many different types of clients, including the general public and businesses. Whereas, Investment banks, on the other hand, provide services to large corporations and institutional investors. [9]
Commercial banks generate the majority share of their revenue from interest received on loans and mortgages which makes working there, in any capacity impermissible as the large share of one’s salary is generated from Harām. On the other hand, Investment banks generate their income from commissions and fees on underwriting new issues of securities. Thus, the issue of interest/usury is found less or not at all with Investment banks making working their permissible.
Due to the nature of investments, securities, commodities and etc. There is always a possibility of some level of Harām occurring. For instance, Mortgage-Backed Securities (MBS). Anything to do with insurance is Harām. This is another issue in of itself.
Hence, it is advisable that one donates a small portion of one’s income to charity to offset any Harām which is incurred in their work activities or their earnings.
[1]طَلَبُ كَسْبِ الْحَلَالِ فَرِيضَةٌ بَعْدَ الْفَرِيضَةِ
} [2]وَلَا تَعَاوَنُوا۟ عَلَى ٱلۡإِثۡمِ وَٱلۡعُدۡوَ انِۚ{
[3]يَأْتِي عَلَى النَّاسِ زَمَانٌ، لاَ يُبَالِي الْمَرْءُ مَا أَخَذَ مِنْهُ أَمِنَ الْحَلاَلِ أَمْ مِنَ الْحَرَامِ
}[4]وَمَن یَتَّقِ ٱللَّهَ یَجۡعَل لَّهُۥ مَخۡرَجࣰا. وَیَرۡزُقۡهُ مِنۡ حَیۡثُ لَا یَحۡتَسِبُۚ وَمَن یَتَوَكَّلۡ عَلَى ٱللَّهِ فَهُوَ حَسۡبُهُۥۤۚ إِنَّ ٱللَّهَ بَـٰلِغُ أَمۡرِهِۦۚ قَدۡ جَعَلَ ٱللَّهُ لِكُلِّ شَیۡءࣲ قَدۡرࣰا{
[5]لا تستبطِئوا الرِّزقَ فإنَّه لن يموتَ العبدُ حتَّى يبلُغَه آخِرُ رزقٍ هو له فأجمِلوا في الطَّلبِ: أَخْذِ الحلالِ وتَرْكِ الحرامِ
}[6]ٱلَّذِينَ يَأۡكُلُونَ ٱلرِّبَوٰاْ لَا يَقُومُونَ إِلَّا كَمَا يَقُومُ ٱلَّذِي يَتَخَبَّطُهُ ٱلشَّيۡطَٰنُ مِنَ ٱلۡمَسِّۚ ذَٰلِكَ بِأَنَّهُمۡ قَالُوٓاْ إِنَّمَا ٱلۡبَيۡعُ مِثۡلُ ٱلرِّبَوٰاْۗ وَأَحَلَّ ٱللَّهُ ٱلۡبَيۡعَ وَحَرَّمَ ٱلرِّبَوٰاْۚ فَمَن جَآءَهُۥ مَوۡعِظَة مِّن رَّبِّهِۦ فَٱنتَهَىٰ فَلَهُۥ مَا سَلَفَ وَأَمۡرُهُۥٓ إِلَى ٱللَّهِۖ وَمَنۡ عَادَ فَأُوْلَٰٓئِكَ أَصۡحَٰبُ ٱلنَّارِۖ هُمۡ فِيهَا خَٰلِدُونَ . يَمۡحَقُ ٱللَّهُ ٱلرِّبَوٰاْ وَيُرۡبِي ٱلصَّدَقَٰتِۗ وَٱللَّهُ لَا يُحِبُّ كُلَّ كَفَّارٍ أَثِيمٍ {
[7]لَعَنَ رَسُولُ اللَّهِ صلى الله عليه وسلم آكِلَ الرِّبَا وَمُوكِلَهُ وَكَاتِبَهُ وَشَاهِدَيْهِ وَقَالَ هُمْ سَوَاءٌ .
[8]لَعَنَ رَسُولُ اللَّهِ صلى الله عليه وسلم آكِلَ الرِّبَا وَمُوكِلَهُ وَشَاهِدَهُ وَكَاتِبَهُ .
Only Allāh Ta’ālā knows best.
Written by Mufti Mohammed Dilwar Hussain
Checked and approved by Mufti Mohammed Tosir Miah
Darul Ifta Birmingham
