Accounting rules and regulations in UAE

 

The UAE has signed more than 66 international double tax treaties with major countries such as China, the United States, and the majority of The European Union (EU) members.

Basic accounting is essential for business in Dubai or all over the world. The accounts need to be constantly updated otherwise it will lead to an improper audit. All the companies need accurate auditing and financial services. The step-by-step deployment of the accounting cycle enables the companies to provide better insights to the stakeholders, potential investors, and quantitative information of monetary assets.

 

Every business needs to follow accounting laws according to the government rules & regulations. If you are a new or established business in Dubai and across the UAE have to ensure compliance with universal accounting standards for higher transparency and accuracy of financial records Top accounting and bookkeeping services in Dubai will help you to crack out your problems in financial transactions.

 

This article will help you to understand scenario of accounting rules and regulation in Dubai.

Bookkeeping principles

According to the Federal Law No 2 of 2015 on Commercial Companies and the UAE VAT law, and relevant free zone laws, it is mandatory for every company to maintain the books of accounts for at least 5 years. Maintaining proper books of accounts is compulsory in the UAE, and any violations will have to bear administrative penalties.

Most bookkeeping principles in are Generally Accepted Accounting Principles (GAAP) and International Financial Reporting Standards (IFRS).

Accounting standards are the principles set for financial reporting. The rules are made to record how the transaction has to be made.

All the companies listed in the NASDAQ Dubai, Dubai Financial Market (DFM), or Abu Dhabi Securities Exchange (ADX) is required to manage their accounting records by International Financial Reporting Standards (IFRS). If private companies are formed based on UAE commercial companies’ law, they must follow international accounting rules.

Accounting Records (Article 26) UAE federal law

The shareholders could verify that company accounts are maintained as per the provision of this law. Each company shall maintain its accounting records in its head office for at least five years as per the company year-end date.

An electronic original is an electronic document that comes from an authorized and verifiable source, and has not been altered there for a company may maintain an electronic copy of originals of any documents and papers kept in the company.

From 1st January 2018, the VAT has introduced across UAE at a standard rate of 5%. The VAT paves a new way of income to the UAE government and reduces dependence on oil and other hydrocarbons as a source of revenue. The VAT record should include TAX invoice, credit note, debit note, bill of entry these apply to all business owners, whether or not they have registered for VAT 

Outsourcing business and tax consultancy in Dubai can bring you the following assured benefits to your business

• Cost-Effectiveness Access to Expert Knowledge
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• Advanced technology
• Concentration on core activities
• No additional requirement and expense to hire accountants

Confederate experienced professionals can able to advise you on extensive issues related to UAE labour law ensuring compliance with any latest updates & can avoiding leakage of sensitive information, employees’ identities, and potential misuse of company funds, and providing you with world-class financial and accounting services.