Financial Statements & Reporting · United Arab EmiratesYour Corporate Tax return starts from your financial statements. So do your auditor and your free zone authority.
We prepare year-end financial statements for UAE companies under IFRS or IFRS for SMEs, with notes and schedules ready for a registered auditor and for the Corporate Tax computation.
Accounting
At a glance
- Authorities
- Federal Tax Authority (FTA) · Ministry of Finance (MoF) · Free zone authorities
- Forms & references
- IFRSIFRS for SMEsAudited financial statementsCorporate Tax return
- Standards
- IFRS; IFRS for SMEs up to AED 50 million revenue
- Audit for Corporate Tax
- Revenue above AED 50 million, QFZPs and tax groups
- Free zones
- Many require audited accounts at licence renewal
- Used for
- Corporate Tax return, audit, bank and licence renewal
Overview
What it is, and why it matters.
Under the Corporate Tax law, taxable income is calculated from the accounting profit in financial statements prepared to accepted standards. Ministerial Decision No. 114 of 2023 requires IFRS, allows IFRS for SMEs where revenue is AED 50 million or less, and permits the cash basis where revenue is AED 3 million or less.
Some businesses must have those statements audited. Ministerial Decision No. 84 of 2025, for financial years starting on or after 1 January 2025, covers businesses with revenue above AED 50 million and Qualifying Free Zone Persons. Tax groups prepare audited special purpose aggregated statements instead of separate ones for each member.
Separately, many free zone authorities require audited accounts with the licence renewal, and banks and investors often ask for them too. Rules vary by zone, so we check what your authority expects.
We prepare the statements and supporting schedules. The audit opinion itself must come from an independent registered auditor, and we work with the auditor you appoint.
Who needs it
Who typically needs it.
- 01
Free zone companies
Companies that need audited accounts for their free zone authority or to claim Qualifying Free Zone Person status.
- 02
Companies above AED 50 million revenue
Businesses that must now have audited statements for Corporate Tax purposes.
- 03
Tax groups
Groups preparing special purpose aggregated statements for the group’s single Corporate Tax return.
- 04
SMEs filing Corporate Tax
Smaller companies whose tax computation needs IFRS-based statements, audited or not.
- 05
Subsidiaries of foreign groups
UAE companies that need local statements as well as reporting packs in the parent’s format.
When you need it
The moments that usually trigger it.
- Your financial year has ended and the Corporate Tax return is due within 9 months.
- Your free zone licence renewal needs audited accounts.
- You’re claiming Qualifying Free Zone Person status and need audited statements before filing.
- Your bank or an investor has asked for financial statements.
- Your revenue has passed AED 50 million for the first time.
- You’re forming or joining a Corporate Tax group.
Scope
Exactly what we handle.
Our engagement letter lists these specifically, so you know what is included before any work begins.
- 01
Choosing the right framework (IFRS, IFRS for SMEs, or cash basis where allowed) and the accounting policies that go with it.
- 02
Year-end adjustments: accruals, prepayments, depreciation, end-of-service gratuity, provisions and foreign currency revaluation.
- 03
Related-party balances and disclosures that the Corporate Tax return and transfer pricing disclosure will draw on.
- 04
Preparing the statement of financial position, profit or loss, changes in equity, cash flows and notes.
- 05
Audit-ready schedules and supporting files, and answering the auditor’s queries.
- 06
Special purpose aggregated statements for tax groups.
- 07
Reconciling the statements to the year’s VAT returns before the Corporate Tax computation.
- 08
Reporting packs in the parent company’s format for overseas groups.
The process
How it runs, step by step.
Timings depend on the authority and on how quickly documents come together. We tell you what’s typical for your case at the start.
Start with a conversationYear-end planning
We confirm the framework, whether an audit is needed and by whom, and a timetable working back from the Corporate Tax and licence renewal dates.
Close the books
We reconcile bank, receivables, payables, related-party and payroll balances and post year-end adjustments.
Draft statements
We prepare the draft statements and notes and go through them with you before the auditor sees them.
Audit support
Where an audit is required, we provide schedules and answer the auditor’s queries until the opinion is signed.
Final statements and handover
Final statements go to your free zone authority, bank or shareholders, and into the Corporate Tax computation.
What we’ll need
The information to have ready.
A typical checklist. After the first conversation we send a version specific to your situation, so you don’t gather anything you don’t need.
Records
- Reconciled books or a trial balance for the year
- Year-end bank statements for every account
- Fixed asset register and asset purchase invoices
- Payroll and gratuity data
Legal and licence
- Trade licence and MOA
- Share capital details and any changes in ownership
- Shareholder and board resolutions from the year
Balances
- Customer and supplier balances at year end
- Loan agreements and statements
- Related-party balances, confirmed by the other party where possible
Prior year
- Previous financial statements and audit report
Please don’t email passports or bank statements. Once we’ve spoken, you’ll get access to a secure upload.
Common mistakes
Where this usually goes wrong.
The problems we are most often asked to fix, and what they tend to cost.
- Mistake 01
Using a basis the tax rules don’t accept
Cash-basis statements are only allowed where revenue is AED 3 million or less. Above that, statements need to be on an accruals basis under IFRS or IFRS for SMEs.
- Mistake 02
Unreconciled related-party balances
Balances with a parent, sister company or owner that don’t agree with the other side’s records hold up audits and transfer pricing disclosures.
- Mistake 03
No provision for end-of-service gratuity
Auditors expect a gratuity provision for every employee. Leaving it out misstates profit and the balance sheet.
- Mistake 04
Starting the audit too close to the deadline
Where the Corporate Tax return depends on audited statements, a late start puts both the audit and the 9-month deadline at risk.
- Mistake 05
Statements that don’t agree with the VAT returns
Revenue in the statements that differs from a year of VAT returns without a clear reconciliation invites FTA questions.
Worth knowing
The limits, stated upfront.
We are not your auditor. The audit opinion must come from an independent auditor registered to practise in the UAE, and we cannot audit statements we prepared.
Free zone filing requirements vary, and each authority decides what it accepts.
Consolidated group statements and complex IFRS areas, such as financial instruments or large lease portfolios, are scoped separately.
Statements depend on the records and explanations you provide.
Questions
Financial Statements & Reporting: frequently asked.
If yours isn’t here, ask us directly. We’ll answer in plain terms.
Ask a questionDoes my company need audited financial statements?
For Corporate Tax, yes if revenue is above AED 50 million, if you claim Qualifying Free Zone Person status or if you are in a tax group. Your free zone authority, bank or shareholders may require an audit even if the tax rules don’t.
Can I use IFRS for SMEs?
Yes, if your revenue is AED 50 million or less, at the time of writing. Above that, full IFRS is required. We choose the framework with you at the start of the year end.
Can you audit my accounts?
No. We prepare the statements, and an independent registered auditor audits them. Keeping the two roles separate is what gives the audit its value.
Do free zone companies always need an audit?
Not always for Corporate Tax, unless they claim Qualifying Free Zone Person status. Many free zone authorities require audited accounts at licence renewal regardless, so we check your zone’s current rule.
What currency should my statements be in?
Many UAE companies report in AED, and some in US dollars where that is their functional currency. The Corporate Tax return is in AED, so amounts are converted where needed.
How long does the year end take?
It depends on the state of the books and whether there is an audit. With monthly bookkeeping in place, a straightforward year end usually takes a few weeks; catch-up work takes longer.
Related
Often needed alongside this.
The equivalent in our other countries
Speak with a consultant
Talk to us about financial Statements & Reporting.
Pick the closest match and we’ll take it from there. You’ll get a written scope and fee before any work begins.
Or use our three-step guide, or email hello@fiscorra.com
