Why Expo 2020 Participants Require Proper Accounting Support?
Along with the preparations for their participation in the Expo 2020, the official participants of the Expo shall give due care in maintaining proper accounting records for their activities. Here we discuss various aspects and challenges relating to the accounting function of Expo 2020 participants.
Why proper documentation of activities and maintenance of records are important for the Expo 2020 participants?
To ensure compliance with various tax and reporting requirements, Expo 2020 participants shall maintain a proper record of their transactions. At various stages during their involvement in Expo 2020, participants are required to file the details of their transactions and expenses with various regulatory authorities in UAE.
Is there any mandatory or regulatory tax requirement on maintaining proper accounting of activities by Expo 2020 participants?
Every business entity shall maintain their VAT records for at least five years or as long as specifically required by the law (For example, a record relating to real estate are to be maintained for at least 15 years). FTA can ask for the underlying supporting documents for any transactions as reported by the Expo 2020 participants as part of the various reporting forms such as VAT return, VAT refund application, application for VAT registration, application for a certificate for Entitlement etc. In cases, where the participant fails to provide the required documents or accounting records, penalties can be imposed or rejection of applications can occur.
Why is it important to categorise and properly account the expenses and VAT incurred by Expo 2020 participants?
To determine the eligibility of expenses incurred in the perspective of a VAT refund claim by Expo 2020 participants, it is important to categorize the expenses correctly and account them on the basis of their respective nature. A claim for VAT refund is possible only on eligible expenses that fall under the specific categories as listed down in the regulation. Also, the application for VAT refund or VAT return, as the case may be, requires to provide the amounts of expenses and VAT amounts accurately in the allocated fields. Proper accounting and maintenance of records will enable the participants to complete the forms on time without errors. Also in case of any FTA audits or investigations in future, the records shall be available for inspection for the time period as long as mandated by the authority.
What are the challenges of maintaining proper accounting of activities by Expo 2020 participants?
Especially during these tough times due to the pandemic, Expo 2020 participants may face various challenges in keeping the adequate accounting records. Some of the major challenges are listed down below:
- Non-availability of competent resources to perform the accounting function
- Lack of clarity on the regulatory requirements to ensure compliance with the mandates as stipulated by the accounting framework followed by the participant
- System limitations to account the complex activities and respective tax treatments
- Absence of integrated processes within the organisation which may cause delays in internal control procedures and recording of the underlying transactions
Why it is recommended to get expert advice and support for maintaining proper accounting of VAT by Expo 2020 participants?
FTA has issued specific guidelines which are supposed to be followed by the Expo 2020 participants. Any non-compliance with respect the tax rules can result in investigations or penalties, depending on the scenarios. Entities are expected to apply proper tax treatments and maintain adequate records relating to their activities as stipulated by the law. In specific cases such as applying for a certificate for entitlement, VAT refund application etc. the Expo 2020 participants have to attach additional supporting documents as required and to ensure the timely completion of such filings, proper accounting of regular transactions is extremely important.
How CDA can help Expo 2020 participants in their accounting function?
CDA have a dedicated accounting team who can assist you in maintaining proper accounting records and supporting documentation to ensure compliance with the applicable regulatory requirements. We can guide you in each step of your journey through Expo 2020 and keep you informed about the updates and notifications from relevant regulatory authorities.
This completes our discussion, hope you got a clear idea of why Expo 2020 participants require proper accounting support. Still, you need expert advice on accounting for Expo 2020 participants? you can contact us for a free one-hour consultation with us, where we can further provide you with the insightful thoughts on the various accounting challenges, share with you value-adding feedbacks on your existing processes and clarify your queries on activities relating to Expo 2020.