Statutory Audit & Procedures in Dubai UAE

What Is Meant By Statutory Audit?

A statutory audit means an independent check of a company’s financial statements and records. The government or other authorities require firms to have this audit. The main goal is to make sure the public gets true and fair financial information. The statutory audit shows if the company follows the law and if the records match the business’s real position.

Why Should A Company Do a Statutory Audit?

Companies must do statutory audits to confirm their accounts are correct. This audit checks if the business follows the rules. The auditor inspects bank balances, records, and how the firm operates. The process gives a clear picture of the company’s financial status. The public, shareholders, and authorities use these reports to trust the company.

What Are The Essential Requirements Of a Statutory Audit?

To start a statutory audit, the firm must appoint an independent auditor. The company must provide the following:

Fixed asset lists and supporting papers
Bank statements with credit and debit records
Details about secured and unsecured loans
Lists of trade receivables and payables
Records of all local, import, and export sales and purchases
Inventory statements and stock sheets
All tax returns and records of statutory dues
Records of selling, admin, and other business expenses
Forex profit and loss details

The auditor may also ask for other files or accounts. The time needed for an audit depends on the company’s size and operations. Sometimes it takes a month or even longer.

Advantages of Statutory Audit

Firms gain many benefits from a statutory audit, including:

Improved company image and goodwill
Higher public trust and credibility
Better transparency for investors and customers
More accurate and reliable business reports

A statutory audit builds confidence in a company’s financial position.

How Can Statutory Audit Help a Business in UAE?

A statutory audit gives many advantages to UAE companies:

All UAE mainland businesses must have their accounts audited by a licensed auditor.
Many free zone firms have special audit needs.
Audit reports are needed to renew business licenses.
Companies need audit reports to apply for loans or investments.
Audit reports help in share transfers and mergers.
Public companies must give audit reports to the public and shareholders.
The statutory audit report shows the true financial position and helps build trust.

Steps in the Statutory Audit Process

Here are the common steps involved in a statutory audit:

Appoint a licensed statutory auditor.
The auditor accepts the appointment and gets the business’s records.
The auditor studies company departments and sees if guidelines are followed.
The auditor checks the control systems and reviews past audit reports.
The auditor examines every important record:
- Bank statements
- Fixed asset details
- Trade receivables and payables
- Purchase and sales records
- Tax documents
The auditor writes a detailed report and submits it to management.

A statutory audit checks if the firm follows rules, protects shareholders, and keeps the company’s image strong.

Quick Tips for a Smooth Statutory Audit

Gather all business records early.
Stay in touch with your auditor during the year.
Keep your accounts updated and error-free.
Ask auditors for advice if you’re unsure about transactions.
Fix problems as soon as you spot them.

How Mubarak Al Ketbi (MAK) Auditing Can Help

If you want your statutory audit to run like clockwork, you can count on Mubarak Al Ketbi (MAK) Auditing. Their experienced team guides clients through each audit step, checks every detail, and helps firms stay on the right side of the law. MAK Auditing always keeps you ahead of the curve—because a stitch in time saves nine!