The Dubai International Humanitarian City (IHC) is a significant source of revenue for investors and businessmen. The zone offers 100% free foreign ownership and tax-free trade to entities licensed in the free zone. Licensees ought to adhere to the free zone regulations and standards, they are compelled to submit annual audit reports to the Regulatory Authority. An audit is an essential prerequisite that prevents financial anomalies. Hence, companies ought to avail the services of approved auditors in Dubai International Humanitarian City to enforce audit compliance.
The Scope of Dubai International Humanitarian Free zone
Entities that fall under the IHC free zone must meet the following code of ethics:
- The entity must be non-religious
- Every organization must follow a democratic-decision making process
- Independence must be maintained
Within the IHC free zone and its authority, multiple corporate activities can also be undertaken. These include infrastructure, media, education, construction, and even retail companies.
Appointment of Auditors in IHC free zone
The humanitarian organization ought to select an auditor from the list of approved auditors maintained by the free-zone authority. The audit firm or entity must not appoint an auditor:
- Who may be reasonably perceived to have a conflict of interest, or
- May reasonably be perceived not to be independent of the affairs of the entity
How Do Audit Firms Maintain the Nature of Financial Records for Auditing in the IHC Free-zone?
The audit firms in Dubai associated with or licensed in the free zone must maintain a file of annual financial records that is sufficient. Following is a list of documents needed for the audit of any entity licensed in the free zone:
- An account of all the money received, transferred, and expanded
- Documents of assets and liabilities
- All sales and purchases of goods
- Transactional and contractual documents
- Memorandum of Association and Articles of Association
- State whether the transactions give a true view of financial affairs
- State the standards and principles used in the preparation of accounts
Read More: Approved Auditors in Dubai,UAE
When Do Firms Submit Their Accounting Records?
It is compulsory for all companies and entities that fall under the Humanitarian city free-zone to comply with the set rules and regulations to conduct an audit. Every audit firm’s financial report must be duly signed by its certified auditors (when applicable) to be submitted to the authority. A copy of the financial report must be sent to the authority within:
- 6 months before the end of the present year, or
- Where the company's finances differ from the calendar year
- Within 3 months of the end of their calendar year, provided this must be sent once per calendar year
Inspection of Financial Records by the Authority
The authority holds every right to obtain information on audit records. This is why an inspector may enter the premises and obtain full information on the audit work from time to time to ensure compliance with the regulations. And report on the nature and conduct of these financial assets back to the authority.
Significance of Auditing in the IHC Free Zone
Being a popular spot for many commercial or business companies, IHC free zone provides enormous offers to grow business including:
- 100% free foreign ownership
- Warehouse and facility management
- A lot of licensing options
- Completely tax-free trade
- The Government provides full support and services as it is launched by the government
- Administrative support and humanitarian experts
- A two-year licensing program is available with privileged services. You can opt for either the Standard office package or the Business center package
- Free transport from the nearest metro station to the International Humanitarian City
How Can Farahat & Co Help You?
To run a business efficiently and effectively in the IHC free zone, entities ought to adhere to the rules and regulations of the free zone, and companies must perform formal audits annually. Farahat & Co. provides trusted accounting and audit services in Dubai that are customized to meet the client’s specific needs. Contact us today and we shall be happy to assist you!