What Are The 3 Types Of Audits In The UAE?

One of the chief aims of businesses is to maintain the company management in tip-top shape. To process this, several tools and techniques are followed by businesses. Considering this, one such technique is to audit the organisation at frequent and regular intervals.

Speaking of UAE, companies/firms or organisations have been deemed with essential auditing in several jurisdictions. In such cases, even if it is not required, the management has to do so. One good side is, it helps the management analyse the current shortcomings of the business. Consequently, it presents the management with a wide view of how to deal with and walk into the future.

3 Types Of Audits in UAE

Moving forward, there are distinct types of audits that management can undertake to know the present status of the business. Generally, there are 5 main types of audits that companies in the UAE need to follow. However, below is a list of 3 main types of audits in the UAE.

Internal Audit

This is a type of audit that is used to pick out the current status of businesses. Such businesses should however concern themselves with the resources and internal working of the business. This audit helps spot the bottlenecks in the business workings. Moreover, internal audits also state how resources can be used in a better way for businesses.

Internal audits are generally held by an auditor or a team of auditors that are a part of a firm. This enables the auditor to know all the essential information about the organisation.

Internal audits are excellent options for businesses that do not hold much. However, there are certain possibilities that auditors might give biased results. They can also get influenced by any other member of the firm to offer false audit reports.

External Audit

An external Audit is a great option for firms that require answers from a sole perspective. Organisations that own financial backing or can spare certain funds for external audits should go for external business audits.

Unlike internal audits, there are fewer chances of bias in external audits. This is because the auditor is a different individual that has zero affiliations to the organisations. This lowers, or let’s just say, eliminates the chances of favouring the firm or being biased.

This sort of audit offers details regarding the current state of the businesses. However, it’s from a third-person point of view. This gives deep insight and an idea of how the firm is understood in the market. Moreover, it provides details about how businesses can take a step ahead of their competitors.

Tax Audit

Besides Vat registration, Taxation is another vital part of businesses. The Tax Procedure law declares that the FTA (Federal Tax Authority) can investigate all documents and records of all taxable entities in the UAE. Hence, the FTA should ensure that the entity complies with the regulations set by the jurisdiction.

Businesses and firms need to make sure that they comply with these rules. This is to ensure that the firm does not get charged with penalties in the future. Additionally, several firms can take help from third-party accounting companies for managing taxes.

Other Audits: Forensic Audit

Also referred to as the fraud investigation, the forensic audit is another brilliant audit in UAE. Businesses can conduct this to track the transaction activities besides investigating them. This audit assists the firm in case of filing a police report. Moreover, Forensic audits help the management to analyse the different operational bottlenecks in the business.

Conclusion

Besides the four audits listed above, another audit includes the audit of sales. In a nutshell, all five audits are highly prevalent and important in the UAE. However, if you need help to decide the type of audit in your business, you can take the help of an expert accounting company. At Accountant Dubai, they are a reputed financial firm that performs distinct audit services in the UAE. The team helps businesses to conduct and decide the perfect audit for themselves. Furthermore, they also offer excellent vat registration assistance.

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