I can't see it being based on initial letters as that would mean Island being used twice- once as an initial letter and once as a reference to the solution.
I think bibblebub's solution is perfect
Hi weecalf. No I don't think it muddies the waters since that is essentially how bibblebub arrived at BALI- except that the word the 'almost' refers to must be 'alit' rather than 'alighted' since ALI is almost ALIT and not almost ALIGHTED