Terms of Reference (ToRs): Shariah Advisory Services for Zakat System

Position: Shariah Advisor (Individual or Firm)

Location: Islamabad (with remote coordination)

1. Introduction & Project Background

Foundation for Ageing and Inclusive Development (FAID) – A company licensed under section 42 of the Companies Act, 2017. FAID envisions an inclusive society where ageing is a dignified, healthy, happy, and secure experience for all. To champion well-being and inclusion of the marginalized communities, reduce poverty and discrimination based on age, gender, and disability.

Our core values are:

• We are compassionate
• We work with integrity
• We work with transparency
• We are inclusive
• We collaborate for a sustainable impact at scale

FAID is committed to financial transparency and social innovation. To expand its livelihood interventions and social enterprise pilots, the organization intends to establish a robust, transparent, and Shariah-compliant Zakat Collection and Disbursement System. This system will serve as a core mechanism for resource mobilization to support the marginalized.

2. Scope of Work[1]

The Shariah Advisor will provide technical and religious oversight to ensure all Zakat-related activities meet the highest standards of Islamic Jurisprudence and Pakistani law.

A. System Development & Certification

• Shariah Manual: Develop a comprehensive manual for FAID that defines the Nisab, Masraf-e-Zakat (recipients), and the process of Tamlikiat (transfer of ownership).
• Operational SOPs: Review and approve Standard Operating Procedures for the finance and procurement teams to ensure Zakat funds are not comingled with general donations.
• Administrative Cost Management: Define the Shariah-compliant mechanism (e.g., Wakalah model) for recovery of administrative or operational costs associated with Zakat-funded projects.

B. Compliance & Governance

• Document Review: Review and vet donor agreements, Zakat collection receipts, and beneficiary undertaking forms.
• Vetting of Beneficiaries: Establish a Shariah-compliant "Mustahiq" verification framework that aligns with SECP’s AML/CFT (Anti-Money Laundering/Countering Financing of Terrorism) requirements.
• Annual Shariah Audit: Conduct a year-end audit of Zakat accounts and issue a Shariah Compliance Certificate for inclusion in FAID’s Annual Report.

3. Eligibility Criteria (Mandatory)

Proposals are invited from individuals and companies who meet the following requirements:

• SECP Registration: Must be registered with the Securities and Exchange Commission of Pakistan (SECP) as a Shariah Advisor. (Proof of registration is required).
• Educational Background: For individuals, a Takhassus-fil-Ifta or equivalent specialization in Islamic Finance from a recognized institution.
• Professional Standing: Demonstrated experience in advising NPOs or Section 42 companies on Shariah governance.
• Tax Status: Must be on the Active Taxpayers List (ATL) of the FBR.

4. Duration

The consultancy is expected to be completed within 6–8 weeks from the date of contract signing.

A detailed timeline and work plan will be finalized with the selected consultant during the inception phase.

5. Key Deliverables

1. Approved Shariah Manual tailored for FAID’s livelihood and social enterprise programs.
2. Shariah Compliance Certificate for the current fiscal year.
3. Training Session: One orientation session for FAID’s senior management and finance team on Zakat protocols.
4. Quarterly Review Reports on the utilization of Zakat funds.

6. Application Process

Interested parties should submit:

• Technical Proposal: Detailing the methodology for system development and audit.
• Financial Proposal: Including all-inclusive fees for the initial setup and annual audit.
• Proof of SECP Registration.