THE RELEVANCE OF THE VALUE OF HONESTY (SHIDDIQ) TO FINANCIAL REPORTING QUALITY

Nur Annisa Liandra

Abstract


Honesty (shiddiq) is a fundamental ethical value in Islamic teachings that emphasizes truthfulness, integrity, and moral responsibility. In the context of modern financial reporting, this value is increasingly relevant as organizations face persistent challenges related to manipulation, earnings management, and declining public trust. This study aims to examine the relevance of the value of honesty (shiddiq) in enhancing financial reporting quality. Using a qualitative normative approach supported by contemporary accounting literature, this research analyzes the conceptual alignment between Islamic ethical values and internationally recognized financial reporting principles. The findings indicate that shiddiq is closely aligned with key qualitative characteristics of financial information, including faithful representation, reliability, transparency, and accountability. The internalization of honesty as an ethical foundation encourages preparers of financial statements to present information fairly and truthfully, thereby reducing opportunistic behavior and information asymmetry. Furthermore, the study highlights that ethical commitment complements regulatory frameworks by strengthening moral awareness beyond formal compliance. This research contributes to the growing discourse on ethical accounting by integrating religious moral values with modern financial reporting practices. It suggests that embedding the value of honesty within organizational culture can significantly improve financial reporting quality and restore stakeholder confidence in financial information.


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DOI: https://doi.org/10.3059/insis.v0i0.29293

DOI (PDF): https://doi.org/10.3059/insis.v0i0.29293.g14929

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