What are you Loosing by NOT Hiring Auditors?
Auditing refers to the objective and independent evaluation of an organization. Its primary purpose is to provide opinion on the truthness and fairness of the financial statements of an organization. Companies usually seek audit services to comply with external regulation and/or to improve existing controls and processes.
An audit can be performed internally by your own staff or externally by an independent external audit firm. Audit firms often handle finance-related and more extensive audits. To some extent, they also act as business advisors or tax consultants for new and established companies. On the other side, senior and qualified employees of an organization can handle more straightforward engagements like process reviews and internal policy audits. In any case, auditors must possess the necessary auditing skills, knowledge, and experience as their findings affect the decision-making of various stakeholders.
Overview of Auditing Practices in the UAE
The evolution of auditing services in the United Arab Emirates (UAE) emerged from internal and external stakeholders’ need for reliable information in the process of making decisions. The rapid economic growth in the country also underscored the importance of the accounting and auditing profession in building robust business systems and infrastructures. As a result, the demand for auditing jobs in the UAE continued to increase, prompting the emergence, expansion, and demand of more audit firms in UAE.
Also, as part of the Gulf Cooperative Council (GCC), the UAE needs to tighten its economic ties among other member nations. Consequently, companies and financial institutions in the country must adhere to relevant banking regulations to harmonize the accounting standards between GCC countries. It is another area where the demand for accounting and auditing firms is high.
These economic factors contribute to the audit industry’s stable growth in the UAE. The increased importance of auditors in the country also prompted the promulgation of federal laws regulating the exercise of the auditing profession and requiring auditors and accountants to ensure compliance with applicable laws and regulations.
Audit firms in the UAE mainly provide below services:
- Audit and assurance services (e.g., financial and statutory audits);
- Forensics audit engagement
- Processes, systems, and operations audits;
- Compliance audit; and,
- Tax Consultancy services.
Benefits of Audit Services in the UAE
There are countless benefits of getting your books audited. UAE is one of the few countries where mergers and acquisitions are “normal”. UAE is also one of the very few countries where entrepreneurship has become a custom, not by force but by passion. Such massive transactions can never be done without professional auditors who are qualified to perform valuations during mergers and acquisitions and guide small and medium sized businesses about the current and future financial prospects of their companies. Below are some of the main benefits of getting your books audited by professional auditors in UAE.
1) Provides Credibility and Confidence
Majority of the companies in the UAE are mandated to prepare financial statements in accordance with the International Financial Reporting Standards (IFRS). These statements are used by internal as well as external stakeholders. Auditors add credibility to the Financial Statements by giving their opinion on the truthness and fairness of the financial statements.
2) Eliminates Heavy Workload
Large size organizations have massive workload while dealing with internal and external stakeholders whereas SMEs do not know how to prepare the accounts. Audit firms, such as Push Digits Chartered Accountants, can not only take care of bookkeeping tasks but an also take over audit preparation tasks from small as well as large size organizations.
3) Helps in Achieving Business Objectives
Most of the companies in the UAE want to improve their operations and gain competitive advantage. Business leaders, particularly in the competitive industries, implement policies and systems to enhance productivity and achieve targets. Conducting a thorough operational and financial audit is an effective way to evaluate these processes, systems, and operations of organizations.
4) Uncovers Material Misstatement
One of the main objectives of a financial audit is to assess material misstatements in organizations’ financial statements. These misstatements can occur as a result of errors and/or omissions. Many companies, specifically SMEs, prefer to hire bookkeeping companies to avoid material errors and omissions whereas large sized organizations take outsourced CFO services for a high level review before the financial statements are submitted to auditors. Instead of paying two different firms, it is better to hire a firm that provides integrated financial services. This will not only save your costs but will also eliminate chances of material errors/misstatements. Outsourcing these services can help companies to stay on track and focus on their core businesses.
5) Assists in Fraud Detection and Prevention
Internal auditors play a significant role in detecting and preventing fraud and accounting irregularities. Audit firms in UAE can guide companies in designing such systems and processes that ensure maximum protection from frauds and errors. These consultancy assignments cost little money but prevent you from massive losses.
Do not spend money on hiring, training, and keeping costly white-collar employees when auditing companies can provide you better services with better results on a much lower one-time cost.