In light of the UAE commercial company law that was issued in 2015, audit firms in Dubai(UAE) have been forced to get themselves audited. With respect to the law, it has become mandatory for firms to hire a tax agent in Abu Dhabi.
Compliance under new regulations: Under previous regulations, not every firm had to go through process of being audited. Those situated in the mainland had to ensure they kept tabs on their financial books to present it after every 5 years to the relevant authorities. Whereas on the other hand those firms situated in the free zone found relief in not getting their firms audited although they would still keep tabs their financial records out of caution. This would not be the case anymore as per the new regulations, every firm would have to be audited that too on a yearly basis.
Expected changes: The new regulations imposed by the state would definitely affect the functionality of firms. There will be an increase in the number of auditors and tax agents being hired by firms whether in Dubai or Abu Dhabi. Firms located within the mainland might not be affected since they have vast experiences in the world of auditing whereas smaller sized firms in particular might be gravely affected to comply by the new regulations. To better explain it, these firms comprises of sole owners who are mostly financially weak to hire auditors or tax agents.
New regulations, more frauds: Keeping in mind that firms that were not audited previously will find it challenging therefore it is the state’s responsibility to increase awareness regarding fraudsters and scammers. The state should ensure that firms should look to hire licensed auditors and tax agents registered under the Ministry of Economy in the UAE. Firms should avoid sharing information with third parties, there is a way of spotting a fraudster which is done by identifying a counterfeit business proposal. A common trend in social media particularly instagram allows fraudsters to spam a user through direct messages and luring them to invest without realizing they will lose their money. Firms should connect with agencies directly through the concerned ministry rather than any other sources. Firms should try getting their hands on artificial intelligence for auditing their firms and in doing so an auditor is not required.