Internal audit is critical because it helps ensure organizations' integrity and compliance. A strong internal audit is crucial for various reasons. It mainly includes maintaining accountability and improving business progress as businesses face strict inspection and operational risks.
In this article, we will see the importance, of the process of Internal Audit for VARA in Dubai.
Also read: Certified VARA Auditors
Importance of Internal Audit for VARA in Dubai UAE
The importance of Internal Audit for VARA in Dubai is on a large scale but the prominent key factors of its significance are;
| Key Factors | Description |
| Compliance with Protocols | Internal Audit for VARA in Dubai emphasizes ensuring compliance. It helps to obey all UAE's rules and regulations. It is the key factor in evading weighty penalties. |
| Operational Proficiency | Auditing for VARA helps uncover incompetence spots in processes. It also spots pinpoints for improvement to enhance operational efficiency. |
| Boosted Confidence of Stakeholders | Internal Audit for VARA UAE boosts the confidence of stakeholders. It may include investors and clients. It helps to validate VARA's commitment to responsibility and transparency. |
| Risk Identification | Internal Audit for VARA Dubai helps to identify several risks. It includes working and financial risks. It also gives warnings earlier to implement preventive measures. |
| Fraud Detection and Prevention | Internal Audit for VARA in Dubai helps detect and prevent scams. It protects the company's resources and status. |
| Strategic Planning Support | The last key factor of Internal Audit for VARA is that it helps in strategic planning. It provides perceptions of strengths and weaknesses that allow VARA to make well-versed decisions for forthcoming development. |
Process of Internal Audit for VARA in Dubai, UAE
The process of Internal Audit for VARA in Dubai has general 4 phases. Here are the step-by-step phases that should be followed exactly;
Planning Phase
Planning is the first phase of Internal Audit for VARA in Dubai. In this phase, the 3 main steps are;
- The team internal audit meets with the management of VARA
- They understand the objective, aims, and business environment of the company
- They classify important areas of risk and sketch the scope of the audit
During this planning phase, the team makes an audit plan with the help of the above steps. They prioritize;
- The important steps to be taken
- The resources required
- The timeline for the audit
Execution Phase
The second important phase of Internal Audit for VARA UAE is execution. In this phase, the audit team gathers all the fundamental data. After that, they analyze and evaluate VARA's processes, and compliance. This involves 3 major processes to gain insights into the company's practices such as;
- Reviewing documents
- Observing operations
- Interviewing employees
After that, the audit team spots the gaps in controls, incompetent methods, and non-compliance areas. For these actions, the team also uses data analytics tools to classify trends or irregularities.
Reporting Phase
The next phase of Internal Audit for VARA Dubai is Reporting. After completing the audit, the team makes a report in which they mention all the details of their findings. The report contains;
- Observations
- Identified risks
- Recommendations for improvement
The reporting Phase is the most important Internal Audit stage for VARA Dubai. This is because it offers management legal insights to improve all the operations. This report also emphasizes compliance actions with all local rules and corporate protocols.
Follow-up and Monitoring Phase
The last and final phase of the Internal Audit for VARA in Dubai is Follow-up and Monitoring. It includes following up on all the pinpoints mentioned in the audit report. The audit team works to ensure that remedial actions are taken and observe progress. This continuing process helps to;
- Sustain a culture of responsibility
- Nonstop development within the company
Conclusion
Internal Audit for VARA in Dubai is very fundamental due to several reasons. It helps to ensure company compliance, competence, and risk management. A detailed and systematic internal audit process supports spotting noteworthy issues. It also offers legal solutions to fix them. In some of the complex situations, companies need proficient guidance in their internal audit processes. Farahat & Co is one of the top-rated and proficient audit firms in the UAE. Their expert team helps companies with their amazing skills and proven track record to address all VARA obligations effectively.
FAQs
Is Internal Audit Mandatory in the UAE?
Companies in the mainland are obligated to conduct internal audits. It is compulsory to keep their financial records for a least 5 years. This condition helps for numerous purposes such as;
- Simplifying regulatory oversight
- Helping in dispute resolution
- Supporting internal management processes
What Is the Requirement for an Audit in Dubai?
According to UAE law;
- All Taxable Persons with revenue of more than AED 50,000,000 during the applicable tax period are subject to audit
- All Qualifying Free Zone Persons irrespective of their Revenue are also obligatory to make and keep audited financial statements
Who Cannot Be an Internal Auditor?
If you see 144(b) statement of the Companies Act, 2013;
- You cannot appoint a statutory auditor as the company's internal auditor. In simple words, you cannot appoint the same person for both an internal auditor and a statutory auditor.
