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External auditing is the process of ensuring that the financial records and operations of a business firm are accurate by employing the services of an external auditor. External auditors work independently of an auditing firm. External auditors are necessary for all businesses to remain compliant with the laws of the government of the UAE. It can help to sort current or impending issues, if any, and confirm the financial claims of the organization to be true.
External auditors are responsible for:
Benefits of External Audit
External audits play a crucial role in enhancing transparency, accountability, and the reliability of financial information provided by organizations. They are especially important for publicly traded companies, which are required by regulatory bodies to undergo regular external audits to ensure the integrity of their financial reporting. External audits also provide valuable information to investors, creditors, and other stakeholders who rely on accurate and credible financial statements for decision-making.
The Commercial Companies Law states that the audit of accounts on an annual basis is necessary for all companies established in the mainland. Freezone entities may also be required to maintain and submit their audited accounts depending on the Licensing Authority.
The timeline for an external audit in the UAE typically varies depending on the specific audit type and purpose. Generally, an external audit can take anywhere from a few weeks to several months. Generally External Audit work will be completed in 30 working days.
Minimum is 6 months and maximum is 18 months duration to prepare for an audit report.
In the UAE, an audit report is not always required to renew a license. The specific requirements for license renewal depend on the type of license and the regulations set by the relevant government agencies. It is advisable to check with the specific agency that issued the license to determine if an audit report is necessary.
Audits are typically conducted by independent external auditors licensed and registered with regulatory bodies.
Flyingcolour® Tax Consultant and J N J Auditing LLC provide Accounting and Bookkeeping services, Tax related services, Auditing, Economic Substance Regulation (ESR) services, Anti-money Laundering compliance services, Tax Residency Certificate Assistance, Payroll Services, Excise Tax services, other compliance, and CFO services, etc. through our team of experienced professionals. We cover comprehensive and customized packages tailored to your specific requirements.
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