Audit readiness in the UAE has become a continuous compliance requirement rather than an annual task in the Emirates’ rapidly evolving tax landscape. With enhanced scrutiny from the UAE Federal Tax Authority, VAT compliance and corporate tax regulations now demand consistent adherence, transparent, structured reporting, and audit-ready documentation. Strengthening internal controls and working with an approved audit firm in Dubai helps ensure year-round audit readiness and regulatory confidence.
Engaging with a UAE FTA-certified tax agent with close to two decades of taxation expertise, such as Jaxa Chartered Accountants, outlines a practical monthly checklist to help businesses in the UAE to stay audit-ready and fully compliant with the UAE VAT and corporate tax regulations.
UAE Audit Compliance: What Businesses Need to Know
Regular audits are a critical compliance requirement for companies operating in the UAE. Through professional auditing services in the UAE conducted by licensed auditors in Dubai and reputable auditing firms in the UAE, businesses ensure that their financial statements comply with UAE regulations and IFRS standards. Independent statutory audit procedures enhance financial accuracy, support corporate tax and VAT compliance in the UAE, and strengthen credibility with investors, stakeholders, and regulatory authorities.
The core audit requirement for UAE business:
- All businesses in the UAE must retain proper books of accounts and documents for a five-year retention period.
- All annual financial reports must adhere to International Financial Reporting Standards (IFRS) to ensure accuracy, consistency, and regulatory compliance.
- To carry out an independent examination of financial statements, companies are obligated to designate a licensed statutory auditor in Dubai.
- Many UAE free zone authorities mandate the filing and submission of audited financial statements to ensure continued regulatory compliance and renewing the business license.
- With tightened scrutiny of VAT and corporate tax in the UAE, structured accounting practices and periodic audits are essential to ensure UAE FTA regulations.
Appointing a certified audit firm in the UAE enables companies to mitigate financial risk, maintain IFRS-compliant reporting, and meet all UAE audit and tax obligations.
UAE Audit Readiness Roadmap for Businesses
Effective audit preparation is a continuous governance process rather than a last-minute documentation exercise. A systematic approach to accounting and bookkeeping practices forms a foundation for smooth audit execution. A trusted auditing service in the UAE assists businesses in maintaining IFRS-compliant financial statements and audit-ready documentation throughout the year.
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Monthly audit readiness checklist
- Complete account reconciliation:
Cross-check bank statements, accounts payable, accounts receivable, and cash balances against accounting records to strengthen audit readiness and financial accuracy.
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Maintain proper documentation:
Retain and safeguard all financial documentation within a compliance-ready digital storage system, supported by secure cloud infrastructure and reliable data backup protocols.
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Record and verify all financial records:
Verify that all transactions and period-end adjustments are properly recorded and assess the monthly trial balance to support audit readiness.
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Strengthen internal control oversight:
Verify that financial transactions comply with documented policies, approval structures, and risk management protocols.
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Verify payroll compliance control:
Confirm that salary calculations, WPS transfers, and statutory deductions adhere to the UAE labour and regulatory framework.
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Quarterly internal audit preparation Checklist
- Ensure UAE VAT Compliance: Ensure timely and accurate filing of VAT returns as per UAE VAT regulations.
- Perform quarterly financial reviews: Review quarterly financial reports to detect discrepancies and compliance gaps.
- Monitor outstanding balances: Review outstanding customer balances and supplier liabilities to maintain accurate cash flow reporting.
- Recognize accruals and provisions: Record expenses and revenues attributable to the reporting period, even if not yet invoiced or settled.
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Annual Audit & Compliance Checklist for UAE Businesses
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Appoint a licensed external auditor in the UAE:
Ensure that the appointed auditor holds a valid professional license and regulatory approval to undertake statutory audits in the UAE.
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Conduct Year-End Inventory and Asset Review:
Conduct a year-end inventory count and fixed asset verification to confirm the existence and condition of stock and assets, and reconcile findings with the fixed asset register and general ledger balances.
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Calculate Annual Depreciation and Amortisation:
Ensure post annual depreciation charge, amortisation entries, and asset disposal align with IFRS standards and internal accounting policies.
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Finalize annual corporate tax calculations:
Review financial statements, apply relevant deductions and exemptions, and compute the company’s corporate tax position as per UAE corporate tax.
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Identify and document all related party transactions and assess compliance with the arm’s length principle and applicable UAE transfer pricing regulations.
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Complete year-end financial reporting:
Prepare and review the annual financial statements, including the balance sheet, income statement, and cash flow statement, in accordance with IFRS to ensure accuracy, transparency, and regulatory compliance.
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Review regulatory compliance status:
Conduct a review of all licensing and statutory documents remaining valid and renewed as per UAE regulatory requirements.
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Assess compliance with New tax updates:
Monitor updates related to VAT refunds, the reverse charge mechanism, and e-invoicing requirements, and update internal processes accordingly to prevent compliance gaps.
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Conduct periodic internal tax Health check:
Conduct periodic internal tax health checks to identify potential non-compliance risks, rectify issues proactively, and strengthen audit preparedness while minimizing exposure to penalties.
Jaxa Audit & Compliance Note
Navigating VAT, Corporate Tax, and statutory audit requirements in the UAE requires technical expertise. Engaging with an experienced and certified auditor and UAE FTA-registered tax agent, such as Jaxa, enhances financial transparency, strengthens compliance controls, adheres to IFRS standards, and facilitates smooth audit completion.
Key errors that trigger UAE FTA Audits.
The UAE’s tax environment requires strict compliance with VAT and Corporate Tax regulations. Failure to maintain proper documentation or submit accurate filings may attract scrutiny from the UAE Federal Tax Authority (FTA). Businesses should particularly avoid:
- Late or incorrect UAE VAT return submissions
- Mismatch between UAE VAT returns and accounting records
- Inadequate supporting documentation for input VAT claims
- Failure to comply with transfer pricing and related-party disclosure requirements
- Inconsistent bookkeeping or incomplete financial records
Engaging experienced auditors in Dubai, such as Jaxa, helps businesses strengthen internal controls, ensure accurate reporting, and reduce audit exposure.
Supporting Documents Checklist for External Audit Review in the UAE
To maintain continuous audit readiness, companies should ensure the availability and proper organization of the following documents:
- Previous audited financial statements
- VAT returns and supporting invoices
- Valid trade license
- Memorandum of Association (MOA) and Incorporation Documents
- Bank Statements and Bank Reconciliation Statements
- Inventory reports
- Payroll records and employee files
- Fixed asset register
Your Partner for Audit and Assurance Services in Dubai
With 18 years of hands-on experience in accounting, auditing, VAT advisory, and corporate tax compliance in the UAE, Jaxa Chartered Accountants has established itself as a reputable provider of professional audit services in the UAE. With extensive experience in statutory audit, internal and external audit, and IFRS-based financial reporting, the audit firm supports businesses in adhering to evolving regulatory requirements with confidence.
Recognized as a registered tax agent with the UAE FTA, Jaxa ensures all advisory and compliance services are fully aligned with updated UAE FTA guidelines.
Our audit and assurance services in the UAE:
- External & Statutory Audit Services in the UAE
- VAT Registration, Filing & FTA Audit Support
- UAE Corporate Tax Advisory & Compliance
- Accounting & Bookkeeping Services (IFRS-Compliant)
- Internal Audit & Risk Assessment
- Regulatory Compliance & Financial Reporting
Why Businesses Trust Jaxa Auditors
- UAE FTA-registered tax expertise
- Strong understanding of UAE VAT and Corporate Tax laws
- Proven audit and compliance track record
- Experienced chartered accountants and tax professionals
- Practical guidance tailored to UAE business environments
- Transparent, ethical, and regulation-driven approach
A well-planned monthly, quarterly, and annual review process, led by experienced auditors in the UAE, helps strengthen internal controls, maintain regulatory compliance, and ensure accurate, reliable financial reporting.
Stay compliant. Minimize risk. Maintain continuous audit readiness.
For professional audit services in Dubai and across the UAE, partner with Jaxa Auditors: your trusted FTA-registered tax and audit advisors in the UAE.
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