INTERNAL AUDIT SERVICES
Internal Audit Services in Dubai, UAE
INTERNAL AUDIT SERVICES
Internal Audit Services in Dubai, UAE
Internal Audit Service in the UAE
Internal Audit Service is an independent, objective assurance and consulting activity intended to add value and develop an organization’s operations. Internal Audit helps a business to achieve its objectives by bringing a methodical, meticulous, and disciplined approach to assess and enhance the effectiveness of risk management, control, and governance processes.
Internal Auditing is an activity carried on by the internal auditor to meet the management requirements of information. It is an independent appraisal activity within an organization for the review of operations as a service to the organization.
Role of an Internal Auditor
Internal Auditor’s role is to provide Management with independent assurance on the organization’s internal controls, risk management strategies and governance are operating effectively. Internal Auditors’ function includes supervising, evaluating, investigating, and analyzing the risks & controls; checking and ensuring information and compliance with policies, procedures, and laws. Internal Auditor will assess the achievement of goals and objectives set by the Senior management. In the case of short of stated goals, the auditor will identify process gaps and make suggestions for improvement for bridging the same.
CLA Emirates [Formerly Emirates Chartered Accountants Group] is a leading Auditing firm in the UAE. If you are looking for Financial Control Audit & Assurance Services in the UAE, then you are in the right place. CLA Emirates [Formerly Emirates Chartered Accountants Group] provides highly qualified professionals in the related field of work by providing a wide range of Audit and assurance services all over UAE – Dubai, Abu Dhabi, Ajman, Sharjah, Fujairah & Ras Al Khaimah.
CLA Emirates [Formerly Emirates Chartered Accountants Group] also provides the following related services,
- Compliance Audit
- Financial Feasibility Study
- Operational Audit
The objectives of Internal Audit:
The objective of Internal Audit is to evaluate and improve the effectiveness of governance, risk management, and control process. The overall objective of internal auditing is to assist all members of the management in exuding their responsibilities. Also, to help them with objective analysis, recommendations, and relevant comments concerning any phase of business activity wherein they can be of service to management. In short, Internal Audit will help the management for:
- Assessing the Risk involved
- Assisting management in the evaluation of internal controls
- To bridge the gaps by strengthening the internal controls and to accomplish organizational objectives
- Evaluating process performance and managing risk effectively
- Help to find the deviations from KPI and to get proper recommendation/ suggestion for improvement
- To verify the fulfilment of plans and sound business requirements and also to focus on objectives
- To evaluate evidence in connection with the situation and issues
Methodology Used in Internal Audit:
1. Defining the Scope of Internal Audit
Risk Rating | Risk Nature | Audit Areas |
May change based on Industry | Financial |
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May change based on Industry | Operational |
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May change based on Industry | Regulatory/ Compliance |
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May change based on Industry | Operational/Financial |
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May change based on Industry | Operational |
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2. Drafting the Risk Assessment Matrix
Risk Assessment Matrix (RAM) is used to define the risk category of each process and sub-processes or areas under the scope of Audit. The level of risk is defined considering the likelihood or probability against the category of consequence severity.
3. Risk-based Internal Audit Plan
A detailed Audit plan will be drafted in discussion with the Management and areas to be prioritized depending upon the risk category & also the nature of the function. Broad areas to be Covered (Can vary depending on the industry and choice of Management)
- Revenue
- Procurement of Goods/ Services
- Inventory
- Logistics
- Information Technology Infrastructure.
- Finance
- Fixed Assets
- Statutory Compliance
- Admin & general Operations, etc.
4. Execution of the approved Internal Audit Plan
On Approval of the Audit plan, fieldwork is executed by performing a walk-through, enquiry, questionnaire, etc. Clients are kept informed of the audit process and the status of the audit.
5. Submission of Draft/ Final Reports to highlight the issues with risk rating and reporting to the management
Once the execution stage is completed, all the observations are collated in a draft report. The risk rating is allotted to all observations with the responsibility of the concerned function. This report is discussed with the Management or Authorised personnel to highlight the issues, concerns, and deviations.
6. Follow-up and Action Taken Report
As it will be a continuous process, the scope does not end with the submission of reports. The follow-up action taken report (ATR) will be represented to the management on the status of observations and its closure status. Any long-pending observations critical to the business will be bought to the notice of the management to set a further course of action.
Independent review and appraisal of the organization’s financial and relevant operational activities will be better when the internal auditor is not part of the organization and is independent.
SPS Management Consultancies Co LLC is a leading Auditing firm in the UAE. If you are looking for Financial Control Audit & Assurance Services in the UAE, then you are in the right place. SPS Management Consultancies Co LLC provides highly qualified professionals in the related field of work by providing a wide range of Audit and assurance services all over UAE – Dubai, Abu Dhabi, Ajman, Sharjah, Fujairah & Ras Al Khaimah.
SPS Management Consultancies Co LLC also provides the following related services,
- Compliance Audit
- Financial Feasibility Study
- Operational Audit
Impact analysis of adoption and implementation of new/revised IFRS standards
IFRS implementation impacts key decisions across organizations. New IFRS requirements lead to reassessment of financial contracts where a new recognition model may be warranted. With the finance-driven nature of businesses, impact on recognition triggers a chain reaction across accounting, tax, and regulatory frameworks. A careful study and proactive planning can help in managing such changes effectively.
Why is it crucial to commence an IFRS impact assessment?
Understanding the implications of IFRS is essential to maintain accurate financials and maintain investor confidence. It ensures transparency and aids in better decision making. Early planning reduces risks and supports smooth transitions.
IFRS 15 – Revenue from Contracts with Customers
IFRS 15 establishes a framework for revenue recognition based on a 5-step model. It helps businesses recognize revenue in a way that reflects performance obligations and contract terms.
- Identify the contract with the customer.
- Identify the performance obligations.
- Determine the transaction price.
- Allocate the transaction price to performance obligations.
- Recognize revenue when performance obligation is satisfied.
IFRS 16 – Leases
Under IFRS 16, most leases are brought onto the balance sheet, creating a single lease accounting model. Key changes include:
- Right-of-use asset recognition.
- Lease liability recording for future lease payments.
- Elimination of operating lease classification (except for low-value/short-term).
- Impact on EBITDA and financial ratios.
IFRS 9 – Financial Instruments
IFRS 9 governs classification, measurement, and impairment of financial instruments. It affects how banks, financial institutions, and corporates assess credit risks and recognize expected credit losses.
- Business model-based classification.
- Forward-looking expected credit loss model.
- Volatility in earnings due to fair value adjustments.
IFRS 17 – Insurance Contracts
IFRS 17 replaces IFRS 4 and sets a comprehensive accounting model for insurance contracts. It enhances comparability and transparency in financial statements of insurance companies.
It aligns with general measurement models or premium allocation approaches depending on the nature of contracts and significantly impacts KPIs, profit emergence, and operational systems.