Regulatory, Statutory, and Performance Audit in UAE

Tally Solutions | Updated on: November 8, 2022

Regulatory audit in UAE
Statutory audit in UAE
Difference between regulatory & statutory audits
How do statutory audits in UAE work?
Performance Audit in UAE
Performance Audit Standards in Dubai
The benefit of performance audits in the UAE
How can TallyPrime help?

Businesses in the UAE have a lot of expansion and investment opportunities. UAE is considered as a top investment destination due to its business-friendly policies and robust legal system that protects the rights of companies.

Many laws and regulations apply to UAE companies. Different government entities regulate different aspects of companies and understanding the different types of audits such as Regulatory, Statutory, and Performance Audit in the UAE supports your business growth and protects it from being penalized.

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Regulatory audit in UAE

A regulatory audit in the UAE aims to confirm that a plan or project is compliant with regulations and standards. Best practices specify that a regulatory audit has to be accurate, objective, unbiased, and independent with oversight and assurance to the company.

Statutory audit in UAE

A statutory audit in the UAE is a mandatory analysis and review of the correctness of a business’s financial reports and financial statements by an external entity, to determine whether a company provides a fair and accurate representation of its financial status. This audit involves reviewing banking balances, accounting records, financial transactions, and business activities.

Difference between regulatory & statutory audits

The term, "statutory" refers to a decree, act, or regulation related to the state, national, or international laws. These legal obligations are mandating that entities need to obey to continue the sale of their products or services.

In general, a statutory requirement is an established rule by law, like copyright, and trademark protections. A regulatory requirement is established by government agencies.

The following comparison may help you understand the Difference between Regulatory & Statutory Audits:

	Statutory Audit	Regulatory Audit
Source of Requirements	Statutory requirements emanate from legislation that has been acted into law.	Regulatory requirements emanate from regulations, which have been put in place by government agencies.
Penalties for noncompliance	Statutory requirements are often backed up by criminal penalties for noncompliance	Regulatory requirements do not carry such criminal penalties for noncompliance
Requirements Examples	Statutory requirements are obligations forced by law such as correctness and accuracy of financial statements and Taxation records	Regulatory requirements are guidelines and standards such as environment protection, supporting client and employee satisfaction

How do statutory audits in UAE work?

Civil law in the UAE mandates a statutory audit in the UAE. During a financial audit, the organization’s business reports on earnings, investment gains, expenses, and other details get audited. A financial audit concludes if funds are used accurately and if all demanded financial records are accurate and correct.

In the statutory audit, auditors demand the documents for review. The records are provided to auditors as demanded so that they can complete the audit. If there is imprecision, relevant outcomes from penalties to imprisonment apply.

Performance Audit in UAE

A performance audit in UAE is the self-governing appraisal of an entity’s processes to analyze the performance of certain business arrangements. Performance audits get affiliated by government offices at all levels and receive federal funding.

Performance audit in UAE inspects the performance and effectiveness of a plan or project to achieve improvements. It is to present objective and unbiased data that reduce costs and make business developments. The federal government of every country sets out the standards and guides for audits.

Performance Audit Standards in Dubai

The general standards include professional knowledge, quality control, and competence. It aims to ensure that the auditor is objective, competent, and endures internal quality controls. Field standards apply to the preparation, gathering of evaluation matter, preparing the required documentation, and seeking to outline the auditor’s objectives, procurement, and operations. Reporting standards relate to the report’s content and communication.

The benefit of performance audits in the UAE

The auditors forward their conclusions to the company’s management. Its object is to use its outcomes to implement any changes to enhance processes and assists them in achieving the organization's objectives. The company abides by a follow-up performance audit to find whether the management has implemented the audit conclusions.

The value of an audit does apply to the management. It also applies to the board of directors, and shareholders, as they can see if specific company plans are worth their investments and make informed board decisions.

How can TallyPrime help?

The different types of audits are not a problem anymore when you use TallyPrime and can help your business in the UAE in a regulatory, a statutory, or a performance audit with its smart integrated features such as:

Generate an Audit File (VAT) at a click of a button. In a few clicks, you can generate comparative analysis across a defined period

A view of all business insights in one place with a wide variety of insightful business reports in the blink of an eye
TallyPrime can help the auditors with its flexible inventory management system to reach a variety of inventory reports
It is engineered to keep all the reports ready as and when transactions are recorded, and insights are right there, exactly when you need them. As a result, the audit can be carried out smoothly