Human Capital versus Ceremonial Structures: Nazhir Competence, Internal Control Decoupling, and Financial Reporting Quality  in Waqf Institutions

Siti Nurul Aeni; Rohania Ayu Yunanda

doi:10.30993/jicab.v4i2.628

PUBLISHED

2026-09-22

ISSUE

Vol. 4 No. 2 (2026): JICAB

DOI

https://doi.org/10.30993/jicab.v4i2.628

Abstract

The optimization of waqf assets in developing economies continues to face major barriers due to accountability gaps and low adherence to specialized accounting frameworks like PSAK 112. Drawing upon Human Capital Theory, Stewardship Theory, and Institutional Theory, this research investigates how nazhir competence and internal control mechanisms empirically influence financial reporting quality within waqf institutions. Utilizing an explanatory quantitative design, empirical data were gathered via structured questionnaires distributed to 56 financial administrators and operational leaders across official waqf organizations in Bandung, Indonesia. The data were evaluated using Partial Least Squares Structural Equation Modeling. The results indicate that nazhir competence exerts a positive and statistically significant influence on financial reporting standards, demonstrating that technical accounting comprehension, professional proficiency, and fiduciary integrity are crucial for ensuring transparent disclosures. On the other hand, internal control frameworks demonstrate a positive yet statistically insignificant direct relationship with reporting quality. This lack of significance points toward an organizational decoupling phenomenon, where internal controls function primarily as ceremonial mechanisms for regulatory compliance and physical asset protection rather than tools to improve financial statement precision. These insights suggest that regulatory authorities and waqf boards ought to prioritize mandatory professional credentials and capability development over standard procedural controls to boost institutional accountability.

KEYWORDS

Nazhir Competence, Internal Control, Quality of Financial Statements. Waqf Institutions

How to cite

Aeni, S. N. & Yunanda, R. A. (2026). Human Capital versus Ceremonial Structures: Nazhir Competence, Internal Control Decoupling, and Financial Reporting Quality in Waqf Institutions. Journal of Islamic Contemporary Accounting and Business, 4(2). https://doi.org/10.30993/jicab.v4i2.628

Aeni, Siti Nurul, and Rohania Ayu Yunanda. "Human Capital versus Ceremonial Structures: Nazhir Competence, Internal Control Decoupling, and Financial Reporting Quality in Waqf Institutions." Journal of Islamic Contemporary Accounting and Business, vol. 4, no. 2, 2026, https://doi.org/10.30993/jicab.v4i2.628.

Aeni, Siti Nurul, and Rohania Ayu Yunanda. 2026. "Human Capital versus Ceremonial Structures: Nazhir Competence, Internal Control Decoupling, and Financial Reporting Quality in Waqf Institutions." Journal of Islamic Contemporary Accounting and Business 4 (2). https://doi.org/10.30993/jicab.v4i2.628.

@article{Aeni2026,
  author  = {Aeni, Siti Nurul and Yunanda, Rohania Ayu},
  title   = {Human Capital versus Ceremonial Structures: Nazhir Competence, Internal Control Decoupling, and Financial Reporting Quality  in Waqf Institutions},
  journal = {Journal of Islamic Contemporary Accounting and Business},
  volume  = {4},
  number  = {2},
  year    = {2026},
  url     = {https://doi.org/10.30993/jicab.v4i2.628}
}

TY  - JOUR
AU  - Aeni, Siti Nurul
AU  - Yunanda, Rohania Ayu
TI  - Human Capital versus Ceremonial Structures: Nazhir Competence, Internal Control Decoupling, and Financial Reporting Quality  in Waqf Institutions
JO  - Journal of Islamic Contemporary Accounting and Business
VL  - 4
IS  - 2
PY  - 2026
UR  - https://doi.org/10.30993/jicab.v4i2.628
ER  -

License

CC BY NC

Copyright (c) 2026 Nazhir Competence, Internal Control, Quality of Financial Statements. Waqf Institutions © 2026 by Siti Nurul Aeni, Rohania Ayu Yunanda is licensed under Creative Commons Attribution-NonCommercial 4.0 International License