Dubai Multi Commodities Centre (DMCC) is one of the largest free zones in the UAE and is also a global trading and financial hub, which is located in Jumeirah Lake Towers (JLT). The DMCC has a vibrant community and stunning properties which add to the experience of setting up a company in DMCC.
With a suitable location and easy access to the Middle East markets, DMCC free zone is one of the best places to set up a company. Also due to globalization and with the government trying to focus on the other sectors of the economy other than the Oil and Hydrocarbon sector, there have been a huge number of companies which are being set up and registered in the UAE.
If you have or are planning to set up your business here, here’s a handy guide for all your auditing requirements.
Is Auditing Mandatory for a Company in DMCC?
Yes, it is necessary for a company to conduct Audit. To that end, every company in the DMCC free zone is expected to maintain its audited financial reports. in case the business fails to submit the required documents to the free zone authority, it could lead to a penalty of AED 5,000 or rejection of the trade license renewal.
Anyhow, after the introduction of VAT since 2018, financial auditing help in maintaining all the necessary documents required by a company and serves the additional purpose of helping you file VAT at the end of every tax period.
What is the Benefit of Auditing for my Company?
Auditing in DMCC (Dubai Multi Commodities Centre) ensures that all your financial records are accurate and well maintained. This will help you in staying on top of the financial health of the company. It is only at the end of every quarter that you’d realize what a boon Auditing is for Planning & Budgeting. After the analysis of all the documents, the management can make the required changes and can be rest assured that cash flows and borrowing capacity of the business are in order.
When are you supposed to submit the Financial Reports in DMCC?
The company is required to submit the financial statements which will have to be audited by a DMCC approved auditor within 90 days of your company’s financial year ending. If the deadline mentioned is not followed, then it may result in a fine and/or non-renewal of your business trade license in DMCC.
What is the Audit Process for a Company in DMCC?
A company in DMCC is required to maintain all its financial records. It is also advisable that these documents of the company are audited periodically. This will prevent any sudden surprises at the end of the financial year when the documents are submitted to the DMCC authority. Here, one thing you need to check is that the financial audit is conducted by an approved auditor who is licensed by the Ministry of Economy and approved by DMCC authority.
There are many advantages of having the business audited as it assists the company management in understanding the present financial condition of the company as well as it also helps to maintain the financial records of the company which come in handy at the time of filing the taxes.
What Records are Required for the Auditing?
In order to Audit your company in DMCC, your auditor will require the following documents. These documents should correspond to the period in which the audit is being conducted.:
- Bank Statements
- Credit/Debit confirmation slips for all financial transactions
- Copies of Bills and Invoices
- Statement of Deposits from the DMCC portal
- Memorandum of Association (MoA)
- Articles of Association (AoA)
The Authority in DMCC has the power to ask for any required document from the client during the time of audit if the need arises.
DMCC Approved Auditors
We at JAXA Chartered Accountants can assist you with all your auditing and accounting needs in DMCC. We are DMCC approved auditors and have been assisting hundreds of firms with their audit in the DMCC Free Zone. Our team of veteran chartered accountants go beyond traditional fundamentals and add tangible value, seeing to it that auditing assumes a strategic and productive role in today’s corporate governance environment. We also identify areas for improvement and suggest means to help you to achieve your organizational objectives and make a positive contribution to the successful operation of your business.
For your company audit in DMCC, do contact us – we’d be happy to assist!