Importance of Internal Audit Services in Dubai UAE
UAE has witnessed a significant growth over the last decade with establishments in UAE expanding and diversifying exponentially. This makes it practically difficult for the shareholders to oversee the business operations round the clock and thereby dilutes direct management oversight on the business functions, necessitating the need for an internal audit function. Internal audit services in Dubai, UAE fills this gap and plays an important role in assuring the shareholders that the business processes are designed appropriately and working efficiently.
Internal audit is one of the most important functions within an organisation inspite of the fact that there are no corporate or income tax laws prevalent within U.A.E. Every business needs to conduct internal audits regularly to identify and mitigate risks, assists the accounting team in efficient and management reporting timely, evaluate the organisation’s internal controls, and avoid fraud and misappropriation threats.
Here are top five advantages of conducting internal audits in Dubai, U.A.E:
1. Evaluation of internal controls
An important reason to conduct an internal audit is to evaluate the design and the operational effectiveness of internal controls and thereby, provide an assurance to the management on these controls. The main objective of providing internal audits services in Dubai, UAE is to identify any existing gaps in the internal controls and provide necessary recommendations. Through this process, an internal audit tries to prevent frauds, avoids misappropriation, and improves the financial reliability on operations.
2. Assess the risk management processes
In today’s world of globalisation and technological advancements, business in Dubai, U.A.E has become very dynamic and is subject to various operational, technological financial, legal, and compliance risks. Internal audits identify key risks and recommend ways of mitigating or transferring the risks. They evaluate the risk management processes within the organisation and check if they are functioning accurately.
3. Safeguards assets
Every businessman does a minimum investment in assets from the time that he sets up for the organisation until the very end. These assets are subject to theft or misappropriation over a period of time. Providing internal audit services in Dubai, U.A.E plays a very crucial role in safeguarding and preventing the theft and misappropriation of assets by establishing appropriate internal controls on the acquisition, usage, and disposition.
4. Ensures effective and timely management reporting.
An internal audit assists the finance and accounting team with periodic and flawless management reporting. The internal audit function reviews the business performance compared to previous periods and budgets, identifies trends and variances and reasons for the same through regular management reporting eg. Profit and loss account, Balance sheet, Budget analysis.Internal auditor reviews the reports submitted by the accountant before submission to the management. This helps the management to take appropriate decisions and plan timely.
5. Provides value additions and process improvements
An internal audit plays a key role in promoting value additions and improvements to the existing business processes and practices. It raises the existing standards to the industry benchmarks and eliminates redundant and obsolete processes, thereby paving a way for innovations and better ways of doing things. It makes employees more productive, improves efficiency, quality of operations, and promotes the growth of the organisation.
By regularly conducting internal audits, the internal auditor evaluates and improves the effectiveness of governance, risk management, and control processes on an ongoing basis. The organisation stays in check and successfully balances all procedures regularly.