By LEDGERS team
The question of “what do auditors offer?” is often asked when a business considers obtaining the services of audit firms in Dubai. Auditors often perform numerous procedures on different types of engagements that add value to their clients and address specific needs. These procedures range from asking questions, gathering information and examining accounting records to observing procedures and testing internal controls over financial reporting. The extent, nature and frequency of audit procedures will depend on the type of engagement, clients’ needs, and the assessed risks. Therefore, audit firms in Dubai compete in offering various types of audits such as financial audits, financial reviews, Agreed-upon Procedures (AUPs), audits of internal control, compliance audits and tax audits.
Financial Audits and Reviews
All top audit firms in Dubai offer the most common assurance services such as financial audits and reviews. Financial audits involve expressing an opinion on the fair presentation of financial statements, in all material respects, according to the applicable financial reporting framework, which is a reasonable level of assurance. Reviews offer a moderate level of assurance and involve issuing a review report with a conclusion statement. When choosing between audits and reviews, the deciding factors for businesses include cost, purpose of auditor’s report and regulatory requirements. For example, a business that is not required by law to present audited financial statements might still seek evaluation and recommendation from auditors through review engagements. In other cases, businesses often require audited financial statements to obtain loans and funding from financial institutions and individuals. In both audits and reviews, the auditor provides recommendations and valuable insight to top management to address risks, find solutions and add value.
Agreed-upon Procedures (AUPs)
Agreed-upon procedures (AUPs) engagements address the specific needs of each client where the client agrees with the auditor on a set of procedures that target a specific business process or financial statement line item. Examining and testing reported revenue by third parties to a client is a common example of AUPs. The final report provided by the auditor for AUPs engagements contains a list of all the specific procedures performed and the findings for each procedure.
Top Audit Firms in Dubai: Audit of Internal Controls
Businesses rely on internal controls to conduct their operations efficiently, safeguard their assets, maximize completeness and accuracy of accounting records, detect and prevent fraud and achieve timely preparation of financial reports. An auditor who is engaged to conduct an audit of internal control over financial reporting will select controls for testing after determining which controls address the assessed risk of misstatement to relevant assertions. The auditor will express an opinion on the effectiveness of internal control over financial reporting after obtaining sufficient and appropriate evidence from testing of controls. The audit of internal controls is often integrated with a financial statement audit; in such integrated audits, the misstatements detected during the financial statement audit will affect forming an opinion on internal controls along with other identified control deficiencies.
Business Consulting Services: Compliance Audits and VAT
Top audit firms in Dubai offer business consulting services related to compliance with laws and regulations imposed by the UAE federal government and local authorities. An auditor performing a compliance audit will review whether the audited entity is upholding and adhering to the applicable laws and regulations and suggest ways to improve. Organizations seek to ensure loyalty to upholding applicable laws and regulations to reduce risks and avoid negative consequences resulting from non-compliance. Audit firms in Dubai can help organizations ranging from startup businesses to large corporations resolve issues rating to VAT accounting and reporting.
Audit of Sales
One of the most common types of audit engagements that top audit firms in Dubai are often requested to perform is audit of sales. Numerous retail businesses operating in malls and shops in Dubai have a lease agreement with the landlords of the shops, whereby each retailer is required to a submit an audited statement of gross turnover. Audit of sales will provide assurance to the landlord regarding the accuracy of the gross sales turnover statement submitted by the retailers as well as the degree of the retailers’ compliance with the lease agreement. Audit of sales will also provide insights into the sales collection process and any relevant control over the sales process to identity areas of weaknesses that require rectifications.
Forensic Audits
Another type of audit that has recently become more common is forensic audits. Top audit firms in Dubai are often requested by regulatory authorities and other institutions to investigate issues involving fraud, financial crime, such as money laundering, bribery, and corruption. The findings and evidence gathered by auditors in a forensic audit are often employed in legal investigations and courts of law. Forensic audits can be very similar to financial audits, where auditors are first required to formulate a plan of investigation, which is followed by sufficient evidence gathering, and then finally the findings are documented in a report. However, unlike in traditional financial audits, forensic auditors can also be required to present their findings and elaborate on the evidence collected during court proceedings.
