Abstract:
This study aims to determine, test and analyze the effect of understanding
Islamic financial accounting standards, sharia auditing, and the role of the sharia
supervisory board on the quality of financial reports. The population used in this
study were all Islamic cooperatives inthe city of Medan. This study uses quanti tative methods, the data analysis technique used in thisstudy is the Structural
Equation Model (SEM) approach based on Partial Least Square (PLS). Thestruc tural model testing in PLS was carried out with the help of Smart PLS ver. 3 for
Windows. The results showed that the effect of understanding Islamic financial
accounting standards has aneffect on the quality of financial reports, this indicates
that the higher the level of understandingof Islamic financial accounting stand ards, the better the quality of the resulting financial statements. Sharia audit has
no effect on the quality of financial reports. And the role of the shariasupervisory
board has no effect on the quality of financial reports.
