DMCC Approved Audit

Zone Situated in the Jumeirah Lake Towers (JLT), the Dubai Multi Commodities Centre (DMCC) Free Zone provides several advantages for establishing a company, such as various license options, adaptable office structures, and straightforward business setup procedures. Nevertheless, businesses operating within the DMCC Free Zone are required to have their financial statements audited by auditors registered and approved by the DMCC Authority.

DMCC Regulations for Company Auditing

In accordance with regulations, DMCC has enlisted Dubai auditors in the DMCC Approved Auditors List based on the recently introduced Approved Auditors List Rules. The DMCC emphasizes that the inclusion of auditors in the approved list is intended to ensure the provision of high-quality audit services to companies operating within the DMCC. Registered audit firms with DMCC are those with esteemed chartered accountants adhering to best practices and accounting standards, both locally and internationally, including IFRS (International Accounting Standards). These firms also demonstrate international affiliations and possess a proven track record in conducting financial audits. By engaging the services of registered auditors in Dubai, DMCC ensures that the Audited Financial Statements accurately represent the true financial position of its member companies.

According to the DMCC website, it is stipulated by the Approved Auditors List Rules that all DMCC member companies are required to submit their Audited Financial Statements through a DMCC Approved Auditor. This requirement will be implemented over a transitional period. It is mandated by the DMCC that audited financial statements must be submitted within 90 days after the fiscal year-end.

Auditing Process in DMCC Free Zone

The DMCC Free Zone has established specific regulations that mandate companies and their officials to collaborate with DMCC-approved auditors. Companies are strictly prohibited from furnishing auditors with false, misleading, or deceptive statements. Additionally, companies are not permitted to withhold certain information or engage in the destruction or concealment of documents from auditors.

1. Preparation of Accounts

The DMCC requires that directors of every company operating within its jurisdiction obtain the preparation of accounts for each financial year. These accounts must adhere to the International Accounting Standards (IFRS) and provide a comprehensive overview of the profit and loss for the specified period.

Each company is obligated to submit a copy of the audited financial statements and the auditor’s report to the Registrar within five business days of the relevant General Meeting. Additionally, the company should provide any additional information requested by the Registrar, including the DMCC summary report.

2. Maintenance of accounts

All companies are required to maintain accounting records, including supporting documents, that are adequate to illustrate and clarify their transactions. This is essential to accurately depict the financial position of the company at any given time.

3. Copies of Accounts

 It is required by DMCC that every shareholder of the company is possessed with the right to obtain a copy of the company’s most recent audited financial statements and auditor’s report. A written request can be submitted to the company by the shareholders, and such requests are obligated to be fulfilled within 5 business days by the company.

4. Appointment of Auditors

A company has the authority to designate a firm of auditors responsible for examining and reporting on the accounts prepared in accordance with the specified DMCC regulations. Additionally, a company is permitted to appoint an auditor solely for reporting on its accounts, without engaging them on a general retainer basis.

In adherence to DMCC regulations, the company is mandated to appoint its auditor during a General Meeting. The approved auditor rules periodically published by DMCCA must be adhered to, requiring auditors to be registered by DMCCA as approved auditors.

5. Auditors’ Report to the Company

The auditor’s report is required to affirm whether the company’s accounts have been appropriately prepared in adherence to the International Accounting Standards (IFRS). It should explicitly declare that the accounts provide an accurate and unbiased representation of the profit or loss incurred by the company during the financial year. Additionally, the report must provide insights into whether the company is exclusively involved in activities permitted under its license. Furthermore, it should address any other matters or opinions as required by the DMCC authority from time to time.

6. Auditors’ Duties and Responsibilities

An auditor in DMCC is obligated to conduct inquiries to determine if a company has maintained accurate and proper accounts. The DMCC-approved auditor must verify that the company’s accounts align with the accounting records and returns. Additionally, the auditor must ensure that the financial statements scomply with the International Accounting Standards (IFRS)

It is also the responsibility of the audit firm to ensure that Anti-Money Laundering (AML) and Combating the Financing of Terrorism (CFT) guidelines are adhered to by the company in its business operations. Mandatory reporting is required if the client is found to be involved in money laundering activities.

Why choose MAK Chartered Accountants?

The Dubai Multi Commodities Centre Freezone strictly enforces guidelines governing the auditing process for its member companies. Periodically, DMCC compiles a list of approved auditors to ensure strict adherence to regulations and International Accounting Standards (IFRS). MAK Chartered Accountants stands as a prominent auditing firm in Dubai, UAE, registered with DMCC as an approved auditor.

Our proficient team of auditors will meticulously analyze the accounts of your DMCC Free Zone Company, cross-referencing financial statements with supporting documents. As DMCC-approved auditors, we are poised to assist you in identifying potential risks associated with your business operations. Leveraging our position as a leading auditing firm, we provide the expertise of our seasoned chartered accountants to improve your company’s corporate governance practices.

Demand from DMCC Accredited Auditors to Perform the Financial Audit

For the effective execution of the audit and assurance process, auditors may request DMCC companies to furnish relevant documents corresponding to the applicable period. An opinion on the financial position is facilitated by auditors, financial statements are analyzed at the year-end, and compliance with DMCC authority regulations is ensured. The requested documents may include:

• Bank statements
• Confirmation slips for all financial transactions (credit/debit)
• Copies of bills and invoices
• Statement of deposits from the DMCC portal
• Memorandum of Association (MoA) and Articles of Association (AoA)
• Latest trade license
• Registration details for VAT and excise tax