HALAL CERTIFICATE

Shari’ah Compliance with AAOIFI Standards

Guiding Families Towards Financial Prosperity
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Shari’ah Compliance with AAOIFI Standards

AAOIFI stands for the Accounting and Auditing Organization for Islamic Financial Institutions. It is a non-profit organization that was established in 1991 to develop accounting, auditing, governance, ethics, and Shari’ah standards for Islamic financial institutions. AAOIFI aims to enhance the transparency, efficiency, and stability of the Islamic finance industry by providing standardized guidelines and frameworks.

  • Investments must comply with AAOIFI standards.
  • Prohibited activities include conventional banking, insurance, gambling, alcohol, pork products, and other non-Shari’ah compliant activities.
  • Financial ratios for compliance include:
    • Interest-based debt/market capitalization < 30%
    • Interest-earning deposits or securities/market capitalization < 30%
    • Income from prohibited activities/total income < 5%
  • Screening for halal compliance is conducted quarterly via MuslimXchange and further assessed by Adl Advisory, Noorvest's Shariah Advisor.

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Other Ethical Considerations

Clients may impose restrictions to ensure investments align with their ethical values.Examples include excluding investments in certain industries or focusing on environmentally sustainable companies.

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Purification

Purification refers to the process of cleansing or purging any income that are derived from non-compliant sources. This is done to ensure that the financial activities and earnings remain in accordance with Shari’ah principles.NoorVest calculates the portion of income that is non-compliant and shares it with the client on an annual basis.

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Review of Accounts

Periodic Review

  • Investment Portfolios are reviewed quarterly by the Chief Compliance Officer, Tarif Homsi.
  • Reviews focus on risk tolerance, account objectives, investment time horizon, suitability, asset allocation, rebalancing opportunities, and tax loss harvesting.
  • Financial plans are updated at least annually or as requested by the client.

For more information on AAOIFI standards, the detailed list can be accessed through the AAOIFI website through: https://aaoifi.com/shariah-standards-access-form/?lang=en

NoorVest specializes in halal-compliant wealth management, offering personalized financial planning and transparent investment solutions. With ongoing support and flexibility, we empower individuals to pursue ethical prosperity aligned with their values.
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For additional information, please refer to our Legal & Compliance Disclosure, Form ADV Part 2A,.
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