.

. - Abstract

The main aim of this research is to develop Islamic Financial Indexes which valuates projects from economic perspective within Islamic rules.

The researcher analyzed financial indexes in classical economics point of view and compare it with Islam conditions for knowing if they are acceptable in Islam.

The researcher found that the simple financial indexes like Internal Rate of Return ( IRR ) or Pay Back Period ( PBP) can be used if the cash flaw or income are interest free .The research revealed that there are indexes that can be used in Islam to discount cash flows as Weighted Average Cost of Capital ( WACC ) and Rate of Operational Income if unacceptable elements like risk free rate or interest income are eliminated.

The research recommended some solution to the problem of discount cash flows in the Islamic financial institutions.

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- Weston , J,F, & copeland T,1986, Managerial Finance, Illinios: Dryden press.

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