Plain Dealing

One aspect of Islamic finance is its emphasis on clarity and plain dealing.  On the other hand, let's look at a rule from a capitalist book:

This Statement provides accounting and reporting standards for transfers and servicing of financial assets and extinguishments of liabilities. Those standards are based on consistent application of afinancial-components approach that focuses on control. Under that approach, after a transfer of financial assets, an entity recognizes the financial and servicing assets it controls and the liabilities it has incurred, derecognizes financial assets when control has been surrendered, and derecognizes liabilities when extinguished. This Statement provides consistent standards for distinguishing transfers of financial assets that are sales from transfers that are secured borrowings.

Definitions are so convoluted that books have to be written to explicate a "true sale" from one that is not true.  This makes it unlikely that partners to a deal can really appreciate their risk.

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