International Financial Reporting Standards (IFRS) from Atton Consulting in Dubai
IFRS was developed by the International Accounting Standards Board (IASB) to provide transparency and consistency in the preparation of financial statements across countries. The standards are a set of principles that govern the maintenance of records and the reflection of transactions. IFRS is a kind of international accounting language, understandable to users who have studied its laws. Following the standards ensures business financial stability, openness to investors and other users.
IFRS appeared in the UAE relatively recently, but almost immediately became mandatory. The Securities and Commodities Authority (SCA) has ordered UAE companies to comply with IFRS as it is an instruction from the Central Bank of the UAE.
IFRS are mandatory for local companies whose debt or equity securities are traded on the open market in the jurisdiction of the UAE. And also for foreign companies whose debt or equity securities are also traded on the open market of the Emirates. IFRS accounting standards are mandatory for Emirati public companies listed on NASDAQ Dubai, the Dubai Financial Services Authority (DFSA) and the Abu Dhabi Stock Exchange. IFRS standards are permitted for companies listed on the Dubai Financial Market PJSC. Organizations that are not listed on these exchanges are not required to comply with IFRS. Banks are an exception. There are standards, the application of which in the UAE have the status of permitted, for example, for small and medium-sized businesses.
Importance of IFRS in Dubai
Accounting regulation in the United Arab Emirates is regulated and is mandatory for all companies, regardless of the place of registration. International financial reporting standards were introduced by the state in order to facilitate the access of international capital to the local market. Standardization of financial reporting is a prerequisite for this. It is assumed that IFRS will become mandatory for all Emirates companies without exception. Therefore, Atton Consulting experts recommend referring to the global principles of reporting now.
To do this, it is enough to contact qualified specialists, such as Atton Consulting, who will provide comprehensive services for the translation of your reporting system in accordance with IFRS. Your financial statements will become clear and transparent, without loss of data, without distortions, errors and inconsistencies. Access to updated legislation allows us to proceed only from up-to-date information. As a result, you will receive a systematic display of company operations, organized records and reports compiled according to standards.
Investors who are interested in your business will receive comprehensive information about the financial condition of the company, presented taking into account the main principles - clarity, relevance, reliability and comparability. Do not miss the opportunity to speak the same language with a large international business! Contact Atton Consulting for comprehensive IFRS solutions!
IFRS and Accounting Principles: What's the Difference?
Prior to the introduction of International Financial Reporting Standards, Generally Accepted Accounting Principles (GAAP) were used in the world. Despite the fact that more than a hundred countries have switched to international standards, there are still major financial players in the global market that continue to adhere to GAAP. For example, USA and Canada. How are the two world systems different?
|International Financial Reporting Standards (IFRS)||Generally Accepted Accounting Principles (GAAP)|
|Used in 100+ countries around the world.||Used in several countries, including the US and Canada. They are a generalized methodology that is used in companies at discretion.|
|Introduced by the International Accounting Standards Board (IASB).||Introduced by the Financial Accounting Standards Board (FASB).|
|IFRS allow companies to reverse inventory in critical market conditions.||GAAP prohibits companies from reversing inventory.|
|A business can benefit from the costs of implementing IFRS.||The costs of implementing the principles are charged to companies.|
|IFRS does not support the LIFO (last in, first out) principle in management processes.||GAAP supports last-in-first-out (LIFO) governance processes.|
Accounting principles (GAAP) are designed to govern corporate accounting. Their use requires a wide range of accounting services, as they are required for the management of balance sheets, revenue recognition, general estimates for public development, classification of unpaid items, and much more..
Unlike GAAP, International Financial Reporting Standards prioritize the clarity and readability of financial information, regardless of industry sector. When applying IFRS, the reliability of the reflection of financial results is important. To do this, it is not necessary to complicate the accounting system, it is enough to contact the experienced accountants of Atton Consulting and no longer worry about the correspondence and clarity of your accounting. Trust the professionals of our company - get your reporting in accordance with the international level!
International Financial Reporting Standards Services from Atton Consulting
Atton Consulting experts provide reporting services in accordance with IFRS, provide audit of financial documents, as well as consulting support for accounting in Dubai. For decades of presence in the UAE market, we have earned the trust of numerous customers. Regular requests for service at Atton Consulting is a real confirmation of the competencies and experience of our specialists.
Our target market segment is small and medium business. If compliance with IFRS is not mandatory for your company, then we recommend using the services of transformation of reporting in accordance with the standards. This will allow your business to get closer to your potential investors, increase their interest and open up new opportunities for growth. Following general financial rules along with the big stock market players will bring your business closer to the global trading floors that you may enter in the future.
Contact certified accountants from our team and no longer worry about the quality of your financial statements!
What is the scope of IFRS in the UAE?
IFRS are mandatory for local companies whose debt or equity securities are traded on the open market in the jurisdiction of the UAE. For foreign companies whose debt or equity securities are traded on the Emirates open market.
Which organization implements IFRS in the UAE?
UAE Association of Accountants and Auditors (UAE-AAA). It is the national professional organization of accountants and auditors of the United Arab Emirates. The UAE-AAA does not currently develop accounting standards, but may recommend them to legislatures. There are no national accounting standards in the UAE.
Are all IFRS mandatory in the UAE?
There are standards, the application of which is permitted, for example, for small and medium-sized businesses. Mandatory IFRS are for the listing of foreign companies. IFRS accounting standards are mandatory for Emirati public companies listed on NASDAQ Dubai, the Dubai Financial Services Authority (DFSA) and the Abu Dhabi Stock Exchange. Also, IFRS standards are allowed for companies listed on the Dubai Financial Market PJSC.
Is there a link between VAT and IFRS in the United Arab Emirates?
VAT is a form of tax, namely value added tax. It is an indirect tax on consumption. The tax was introduced in the UAE quite recently and not for all companies. VAT is paid only by businesses with large amounts of annual turnover.
IFRS are international financial reporting standards. They are a set of principles and rules that formulate the requirements for reporting. They are necessary to maintain the uniformity of financial documents. So financial activity becomes more understandable, first of all, for foreign investors.
Why the UAE doesn’t have its own accounting system?
International Financial Reporting Standards are of general importance for all countries of the world. They are necessary for understanding the financial condition of companies by third parties - investors, shareholders, counterparties, stock exchanges and government agencies. This reporting system helps to evaluate a business, determine its position in the market, as well as compare indicators and conduct analysis.