The statutory audit in Dubai is an independent review of financial statements for a company or institution. The auditor's responsibility is to determine if financial statements are true and fair and in compliance with all applicable laws and guidelines. This helps companies plan for the future and protects them from potential risks.
Auditors must identify and report any issues during auditing to fix any issues later. AFD's goal is to deliver timely and effective audits that exceed all statutory requirements.
Below is a list of organizations or companies that should be subject to statutory audits.
Also read: Latest IFRS Updates And Changes For Audit Firms In Dubai
No matter how large a company is, auditing is necessary to verify transparency and efficiency in its operations. These include:
- Banks or investment firms
- Insurers
- Brokerage services offered by the firm
- Publicly traded companies
Benefits of Statutory Audit
A Statutory audit is a great option for businesses because it offers many benefits. Among the benefits of a Statutory Audit for a business are:
- Increased authenticity of financial statements
- Assure the Management’s Attention
- All Compliance Requirements for the Company
- This helps in understanding the company processes
- Easy Access to Loans and Other Forms of Credit
Steps to Conduct a Statutory Audit
An audit is usually conducted when the company is ordered to do so by the concerned authority. The following steps will explain how you can perform a statutory audit of your business:
Step 1. Reviewing the Internal Audit Report
To get a clear understanding of the workings and finances of the company, the first step is to go over the internal auditors’ report.
Step 2. All Conflict Situations Should Be Reported
This internal audit report will identify inevitabilities and provide solutions that will improve the profitability and effectiveness of the company. All these suggestions should be taken into consideration by the present auditor. The points should also reach the company’s management.
Step 3. Review the Previous Statutory Audit Report
In addition to providing a glimpse into how the company was ranked in the past, the previous statutory report will also help with establishing the company’s statutory audit report.
Step 4. Gain Proficiency in the Company’s Accounting and Auditing Software
Many businesses use accounting and auditing software to help them keep track of information about their business. The auditor is responsible for understanding accounting and auditing software and how they work because there are many options to choose from.
- Understanding How Costs and Expenses are approved
- Identify the expenses associated with the business functions related to the goods and services to be audited.
- Defining the company’s marketing, sales, and partnerships policies
- Marketing, sales, and partnerships vary from company to company. To provide reliable solutions, the auditor needs to learn more about the organization.
- Find out more about the company.
Above are merely a few of the steps. There are different business activities involved in every business. It is the responsibility of an auditor to understand these activities and, if necessary, to analyze more options to provide the auditor with more details about the business.
Things to Consider During Statutory Audit
To help the auditor accept or apologize for the audit, it is important to know what kind of client the client is. Understanding the components of an internal control system is essential for understanding how it works (the accounting system mechanisms). If he is unable to sort the client accounts, he can put into practice the procedures of internal control systems.
Assess the risk involved in internal control systems. If it is agreed that there is a high level of risk in the internal control, systems that automatically identify what is missing in the final data audit are considered high risk. The audit must understand the tuning systems to support the conviction.
Analytical Scrutiny
Based on his evaluation of the systems of audit risk and internal control, the auditor decides the nature, timing, and size of the audit.
Evaluation of Audit Results
The auditor concluded the audit. He decided to assess the audit results and draw his conclusions. An auditor's report describes the scope of audit work. This section contains the auditor's final report. It clarifies the findings concerning fairness in each financial position and operation.
Follow-up
The Office of Internal Audit Services will conduct a follow-up audit approximately six months after the publication of the audit report. This analysis will determine whether corrective actions were taken.
Valuation and Evaluation of Financial Assets
After being prepared by employees, accounting records are checked by an external auditor. Internal audit firms in Dubai are responsible for ensuring that financial records are accurate.
Establish Credibility
Reputation plays an important role in the growth of a CA company. Investors will be attracted to a credible company. It is also helpful in gaining government confidence, who now trust the company. Customers perceive the company as a positive brand that fuels its growth.
Recognizing and Correcting Errors
An internal auditor inspects all books of accounts to identify errors and omissions during the auditing process. These errors and omissions can be corrected to keep accurate financial records.
Reduce Fraud Risk
The financial records of a company can't be independently audited without external auditing. Employees may commit scams that go unreported for a long time. This can lead to reputational damage and loss of money.
Get an Objective and Independent Opinion
External auditors examine all financial information of the company and are the best source of current financial information. An external auditor can give an objective opinion on the operation of an organization. A certified internal audit in Dubai can provide valuable insights into the performance of the business.
Statutory Auditor in Dubai
AFD is committed to providing exceptional audit services for our clients. We provide proactive advice and insights that go beyond the basics.
Our goal is to minimize any impact our work has on your day-to-day operations. However, we will still maintain a thorough approach, which includes reviewing documents, recalculating, sending questionnaires, and checklists, and reviewing and analyzing control and system data.
This is a great way to ensure the success and growth of your organization. Audit Firms in Dubai offer a variety of internal auditing services in Dubai.
We are a reliable statutory audit services provider and have operations in Dubai and across the northern Emirates. We offer both statutory as well as non-statutory audit services. Contact us to learn more, and whether your company meets the government's exclusion criteria
Kasun Liyanage is an Audit Manager with over 7 years of experience dealing with diversified corporate clients. He not only manages the team’s work schedule but also is an expert in handling audit areas such as external audits and fraud investigation, Internal control benchmarking and best practices and well as preparation of financial statements and IFRS compliance.
