How can a company achieve a successful annual audit in UAE?
The effectiveness of a company’s internal controls can be evaluated by an audit, which also offers risk management. An annual audit provides the management and the board of directors with a service where the flaws and wrongdoings of the company can be brought to the limelight. An annual audit plays a crucial role in the company’s operation and governance.
Your company’s annual internal audit is not a tribulation designed to keep your life out of order. The annual audit need not be viewed in a negative light as there is no solid reason to dread it. Your company’s annual audit is a tool to check if your financial orders are in place or not. It is a verification and cross-check of your company’s financial system and statements. The accuracy of the processes will be checked by the auditors, and you will be informed if any measures need to be taken to protect the company against fraud. At the end of the audit, it will offer a golden chance for improvement in the functioning of the company’s operations, which will lead to more effective management in the future. You can ensure a better understanding of your job and add value to the organization by being prepared for an annual audit.
Ways to successfully achieve an annual audit are as follows:
- Auditing is indeed teamwork - It is important to keep in mind that a little pressure can be expected during an audit, especially if it’s your first time undergoing an audit. Auditors are preoccupied during the audit season, given the whole responsibility of auditing for several companies on the same day. Also, lack of time isn’t the only issue, the auditors will also have to deal with the shortage of money. So it’s always the best course of action to divide the responsibilities within the team.
- Provide the auditors with the required ‘PBCs’- In auditing, there is a term PBC, which means "provided by the client." The audit firms will set a time-lapse and ask you to provide them with a list of information that has to be provided at the earliest. The information needs to be provided accurately and not for the sake of it, as it can raise issues later on. You need to communicate with the audit firm that is hired to know exactly what the audit firm needs to be provided with.
- Ask questions- Upon receiving the PBC list from the auditors, it should be checked to make sure that you understand everything that is being requested of your company. If there is anything that you don’t understand, make sure you ask questions and understand it prior to the audit.
- Keep the important documents ready- You need to keep the key documents ready beforehand to provide the audit firms with the preparation of the annual audit report. The important documents include the payroll records, a list of all bank accounts, legal documents such as Memorandum of Association (MoA), number of shares, Article of Association (AoA), trade license, tax registration number, and shares and incorporation certificates, partners or shareholder register, minutes of all meetings, list of all transactions, trial balance, general ledger, AML Program Manual, VAT Return Filings, Current Loan Statement, Copies of Leases, Loans, and Contracts.
- Assist the auditors in case any error while auditing is detected- When an auditor goes on with the testing, he may go through the detection of errors in auditing. In such cases, try to determine what the auditors were testing for. There is a high chance that the data you provided them with wasn’t the one they were looking for or that they have been provided with incomplete data. In such cases, communication and clarification are the best solutions.
- Plan the audit well- You need to set aside plenty of time for the audit. Make sure that your main and most important staff do not take a day off while the audit is carried out. You might have already provided the auditors with the information beforehand. However, to get a clear understanding of your company, the auditor may ask you for additional information and details behind the figures. Not being able to promptly answer any queries may lead to prolonging the process. So it is better to plan early as possible and communicate with all the employees regarding their responsibilities in the annual audit.
- Do not wait to address the complication at the year-end- If your company inputs an unusual transaction, do not wait till the year-end to address the complication. You need to call your auditor and make sure that the transaction has received the right treatment.
How can CDA assist you?
Having the best auditor is one of the most important needs of the hour, as audit plays an important role for firms. Conducting an audit being an integral part of the firm and being a requirement to ensure compliance increases the need for an auditor with adequate experience and skills to conduct it. CDA, being one of the best auditing and accounting firms in the UAE provides the best auditing and bookkeeping services in Dubai with the help of its experienced team who have priory worked with the big 4s. CDA always provides its clientele with personalized and custom-tailored services as per their requirements. To find out about the services provided by CDA, contact us now.