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Co-Founder & CEO movingo
Editor
Author
Iakov Kukushkin
Copywriter, Journalist
Dec 26, 2025
By the law, financial auditing is a mandatory part of life for many companies in the UAE. To prepare, you must organize your financial records and consider nuances such as the company's place of registration and annual income. This new article will discuss these details and provide instructions on how to prepare for the 2026 audit.
- What is a financial audit in the UAE and why does it matter?
- Audit requirements in the UAE
- Professional audit support for UAE companies
- Reporting and compliance obligations
- Internal audit requirements in UAE
- List of documents required for statutory audit in UAE
- Audit timeframe and extension
- Location of audit and compliance functions
- Assessment of tax liability and audit findings reporting
- Objection process and appeals
- FAQ: Audit Requirements in the UAE 2026
What is a financial audit in the UAE and why does it matter?
A financial audit is a thorough review of your company's financial records. In the UAE, this involves a third-party, certified auditor confirming that your accounts are correct and in line with International Financial Reporting Standards (IFRS).
Why it matters in 2026:
Why it matters in 2026:
- Corporate Tax compliance: This is a mandatory part of the financial life of many companies in the UAE by law.
- Trust and сredit: In the UAE, companies with unaudited financials rarely attract the attention of banks and investors.
- License renewal: For many entities, you cannot renew your trade license without submitting an audit report.
It's important to get your financial house in order before a financial audit so you don't run into any problems during the audit. You could hire a certified accounting firm that specializes in the UAE market to help you organize your financial records. For example, us. 😉
Audit requirements in the UAE
Are audited financial statements mandatory in the UAE?
The short answer is yes, for most companies. However, the specifics of how and when this applies depend on your specific location.
- For Mainland companies
Under the law, all mainland companies (LLCs, PJSCs, etc.) are technically required to have their accounts audited by a licensed auditor. While enforcement was historically flexible for small businesses, Ministerial Decision No. 84 of 2025 now makes audited financial statements strictly mandatory for any entity whose revenue reaches the AED 50 million threshold for Corporate Tax purposes.
- For Free Zone entities
Free Zones are self-regulated. While many (like DMCC or DIFC) have always required audits, others only required "proper bookkeeping." In 2026, if you are a Qualifying Free Zone Person (QFZP) seeking to benefit from the 0% Corporate Tax rate, you must undergo an audit, regardless of your income.
Even though audits are done by professionals, additional supervision is always helpful. We have seen instances where auditors have made mistakes in their reports, which could have led to serious consequences. So, when it comes to financial matters, it is better to double-check everything. We always adhere to this principle and ensure that you receive a high-quality result.
General requirements for all companies
Under the Federal Decree-Law No. 32 of 2021 and the recent Ministerial Decision No. 84 of 2025, the requirements have become more stringent.
💡 Every company must keep proper accounting records for at least 5 years.
Many of these companies must now formally audit their books to satisfy both the Ministry of Economy and the FTA. Now, let's take a look at the specific requirements for companies from different jurisdictions.
Audit requirements for Free Zone companies
Free Zone authorities have their own deadlines and approved auditor lists. For example:
- DMCC: The deadline for mandatory annual audit is usually September 30, 2026, for the 2025 financial year.
- JAFZA and DAFZ: Audit mandatory for all Free Zone Establishment (FZE) and Free Zone Company (FZC/FZCO) entities.
Audit requirements for Mainland companies in UAE
Mainland companies must prepare financial statements that reflect a "true and fair view" of their financial position.
- Auditor appointment: The auditor must be registered with the Ministry of Economy.
- Thresholds: An audit is mandatory for corporate tax filings if your revenue exceeds AED 50 million.
- Dividend distribution: You cannot legally distribute dividends to shareholders unless you have an audited report confirming profits.
Mainland vs. Free Zone: Audit comparison
Professional audit support for UAE companies
If you want to learn more about the requirements for companies operating in your Free Zone or other jurisdiction, we can help you comply with local regulations and meet deadlines, ands prepare for financial audits.
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Statutory external audit
Ensuring compliance with UAE law and IFRS. -
Tax audit readiness
Pre-audit reviews to ensure the FTA won't find red flags. -
Internal audit and risk advisory
Strengthening your internal controls. -
Corporate Tax consulting
Aligning your audit with your tax filing strategy.
Reporting and compliance obligations
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Financial year-end
Usually December 31. -
Audit completion
It is usually between 3 and 6 months after the end of the fiscal year. -
Corporate Tax Filing
This must be done within 9 months after the end of the tax period (e.g., September 30, 2025, for a December 31, 2024, year-end).
Meeting the deadlines for these and other forms of reporting is crucial, as non-compliance can result in penalties and legal issues. To help you avoid these, we have compiled a dedicated calendar that includes all the required reporting for each company.
Internal audit requirements in UAE
Internal auditing is just as important as external auditing for a company. External audits ensure that everything is legal and that the numbers add up. Internal audits, on the other hand, examine how well the company's systems are functioning and how it can grow.
- New standards: As of January 9, 2025, companies must implement the new Global Internal Audit Standards.
- Regulated sectors: Now, banking, insurance, and public joint stock companies (PJSCs) are strictly required to have a dedicated internal audit function.
- Small businesses: Although it is not legally required for small, private firms, implementing an internal audit process is highly recommended to prevent fraud and ensure "tax readiness" for FTA inspections.
List of documents required for statutory audit in UAE
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Legal documents: Trade license, MOA, AOA, and Share Certificates. - Financial records: Trial balance, general ledger, and fixed asset register.
- Banking: All bank statements and year-end bank confirmations.
- Sales/Purchases: Invoices, credit notes, and VAT returns (filed vs. books).
- Payroll: WPS (Wage Protection System) reports and EOSB (End of Service Benefit) calculations.
- Tax: TRN (Tax Registration Number) certificate and previous tax filings.
Audit timeframe and extension
The audit usually takes 2 to 4 weeks, depending on the volume of transactions. Most Free Zones require submission within 180 days of the end of the financial year. While some authorities, like DMCC, have provided one-time extensions in the past, the FTA is very strict in 2025. Missing a deadline can result in penalties starting at AED 10,000.
Location of audit and compliance functions
Your financial records and the audit process must generally be centered at your registered office in the UAE.
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Records retention: Records must be kept in the UAE (physically or on a secure local server).
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Accessibility: If the FTA conducts a "tax audit" (which is different from your regular financial audit), they will expect the relevant documents and the person responsible for them to be available at your business premises.
Assessment of tax liability and audit findings reporting
Once the audit is done, the findings are used to calculate your Corporate Tax Liability.
- Audit report: The auditor issues an "Opinion" (Unqualified, Qualified, Adverse, or Disclaimer).
- Tax adjustments: Your accounting profit is adjusted for tax purposes (e.g., adding back 50% of entertainment expenses).
- Reporting: If an auditor finds material fraud or non-compliance, they may be legally obligated to report it to the authorities.
Objection process and appeals
If you disagree with a tax assessment based on an audit or an FTA decision, you can submit a request to the FTA within 45 business days of the decision.
If the reconsideration fails, you can appeal to the Tax Disputes Resolution Committee (TDRC) within 40 working days (provided the amount is over AED 50,000). If the TDRC decision is still unfavorable, the case can be taken to the UAE Federal Court within 40 working days.
If the reconsideration fails, you can appeal to the Tax Disputes Resolution Committee (TDRC) within 40 working days (provided the amount is over AED 50,000). If the TDRC decision is still unfavorable, the case can be taken to the UAE Federal Court within 40 working days.
Proper preparation for an audit will protect you from such situations and save you the time it would take to appeal the tax authority's decision. At movingo, our team of finance and taxation professionals has helped hundreds of companies in the UAE get through audits and save more than AED 5 million in fines. Give us a quick call to find out how we can help you.
FAQ: Audit Requirements in the UAE 2026
It is mandatory for any company (Mainland or Free Zone) that falls under the Corporate Tax audit thresholds or is a Qualifying Free Zone Person.
Maintaining books of accounts for at least 5 years, Preparing financial statements according to IFRS, appointing an independent, licensed auditor.
Companies with a turnover above AED 3 million are required to submit audited financial statements that are prepared by a UAE-registered auditor when they renew their license.
Formal audit is mandatory only for public companies, private companies with an annual turnover exceeding USD 5 million, and private companies with more than 20 shareholders.
Your annual revenue exceeds AED 50 million.
Although internal audits are not generally required by law for all private companies, they are mandatory for regulated sectors such as banking and insurance, as well as for public joint stock companies (PJSCs).
Typically, small mainland LLCs with revenues under AED 50 million, as well as free zone companies in specific "light-touch" zones with low turnover, are exempt from submitting audits to the authorities.
Prices range from AED 2,500 to AED 5,000 for small companies and over AED 20,000 for large ones.
Auditors who are licensed and registered with the UAE Ministry of Economy anв auditor from the "Approved Auditors List" for Free Zones.
Although there is no minimum revenue requirement for the legal obligation to keep books, the threshold for a mandatory corporate tax audit is AED 50 million.
