Dubai Healthcare City – Mandatory Audit
20

Apr 2021

Dubai Healthcare City Authority – Regulatory is an independent arm of Dubai Healthcare City Authority. The DHCA is the body of Dubai Healthcare City that regulates it as the largest healthcare free zone for health and wellness globally.

Dubai Healthcare City Authority – Regulatory, now referred to as DHCR, regulates the free zone and directly reports to the DHCA Board. It ensures the compliance of international quality and regulatory standards for clinical and non-clinical establishments. It also provides the licensing of all healthcare professionals, operators and educators incorporated within the DHCC.

Registering and licensing of firms is possible in the DHCC through the registration department in DHCA. The department is made up of a company registry and a licensing unit.

The company registry unit is in charge of –

The business licensing unit issues licenses and renews them at the expiry of such licenses; one of the most common licenses is the commercial license that needs to be renewed every year.

Mandatory Audit of Financial Statements

On February 07, The Dubai Healthcare Authority – Regulatory, the regulatory in the free zone, passed a statement with the context that.

“It is mandatory to submit audited financial statements during the commercial license renewal for entities with the legal frame as ‘Free zone Limited Liability Companies’ effective from March 01 2021.”

This regulation requires Auditing and Assurance Services to have their financial statements audited to renew their commercial license once it expires.

Audit by an Approved Auditor

After the passed regulation, in addition to the above documents, the entity is also required to submit their audited financial accounts by an Approved Auditor to renew their license.

Every free zone LLC in the Dubai Healthcare city needs to get its financial statements audited by a registered auditor or an Auditor Approved by the Free Zone Authority to renew its commercial license.

The points to keep in mind while auditing the financial statements of a free zone LLC is given below

  • 100% foreign ownership of the enterprise
  • 100% export and import tax exemption
  • 100% repatriation of capitals and profits
  • Corporate tax exemptions
  • No personal income taxes 

As the financial year in the UAE is the calendar year, a company can choose its financial year as per requirement. The chosen financial year should not be less than six months and no more than 18 months.

Annual audit of financial statements is now mandatory, and failure to comply with this regulation may lead a registered business to be penalised with a hefty fine, or the LLC will lose its license.

Alternative Approach

Since the requirement of getting the financial statements audited was not mandatory up until recently. Most of the businesses would not have deemed fit to maintain the financial statements.

In case of non-availability of financial statements, the Dubai Healthcare Authority – Regulator suggests the business partners fill and submit the “Financial Statements – Summary Sheet” provided by DHCA-R.

How can an Auditing Firm help?

The latter method includes knowing the following details regarding the company,

  • Revenue for the financial year
  • Direct and indirect costs
  • Current and noncurrent assets
  • Total assets and liabilities
  • Fixed assets and long-term liabilities
  • Share capital and total equity

By filling the affixed form and submitting it to the DHCR, the FZ-LLC can get its license renewed every year, subject to agreeing to maintain its financial statements and getting them audited to get their license renewed the following year.

To comply with all these provisions, the company needs to choose an auditing firm approved by the authorities and having eminent experience with dealing with FZ-LLC’s

How will Jaxa Chartered Accountants help you?

We at Jaxa Chartered Accountants are a leading audit firm in Dubai, UAE. Our highly efficient staff are experienced in providing the most outstanding Auditing, Accountancy, Business Advice, and Financial Planning professionalism.

We are approved by the free zone authorities all over the UAE and provide outsourcing services all over the emirates. We can provide incorporation services and comply with all the steps and requirements in incorporating a company anywhere in Dubai and all over UAE.

Contact Us for more details to know more regarding the services we offer.