Audit & Assurance in the UAE

Almost every argument about whether a UAE company "needs an audit" comes from mixing up two rules that were written for different purposes and sit in different laws.

The first is company law. Article 27(1) of Federal Decree-Law No. 32 of 2021, the Commercial Companies Law, states that every joint stock company or limited liability company shall have one or more auditors to audit the accounts of the company on a yearly basis, and that the remaining forms of companies may appoint an auditor in accordance with the Decree-Law. This obligation has nothing to do with tax. It attaches to the company form itself.

The second is corporate tax. Article 54(2) of Federal Decree-Law No. 47 of 2022 lets the Minister determine which categories of taxable person must prepare and maintain audited financial statements, and Ministerial Decision No. 84 of 2025 sets those categories. This is a tax-filing obligation, tested against revenue and status rather than company form.

A business can be caught by one, both, or — if it is a mainland sole establishment under the tax threshold — arguably neither. The two questions must be answered separately.

The Commercial Companies Law is more prescriptive than most summaries suggest, and the detail matters when a dispute arises about whether an audit was properly conducted.

Article 27(2) requires every company to prepare annual financial accounts including the balance sheet and the profit and loss account. Article 27(3) requires the company to apply International Accounting Standards and Practices when preparing its periodical and annual accounts, so as to give a clear and accurate idea of the profits and losses.

Article 27(4) gives every partner or shareholder the right, on written request, to a free copy of the last audited accounts and the last auditor's report — and a copy of the group accounts where the company is a holding company. The company must respond within ten days of the request. That right is often forgotten in shareholder disputes.

Article 248 sets out the duties, and reading it changes how a business should prepare for an audit.

The auditor audits the accounts, inspects the balance sheet and profit and loss account, reviews the transactions of the company with related parties, and verifies the application of the Decree-Law and the company's statute. The report goes to the general assembly, with a copy dispatched to the Authority and the competent authority.

In preparing the report the auditor must verify the validity of the accounting registers kept by the company and the consistency between the company's accounts and those registers. Article 248(3) gives the auditor the right to review all registers, papers and other documents, to require explanations, and to verify the assets, rights and obligations of the company.

Article 248(4) covers obstruction: if the auditor is not given facilities to perform the duties, that must be evidenced in a report to the board, and if the board fails to act, a copy goes to the Authority.

This decision replaced Ministerial Decision No. 82 of 2023 and reset who must produce audited financial statements for corporate tax purposes. Article 2(1) names two categories.

A taxable person that is not a tax group and derives revenue exceeding AED 50,000,000 during the relevant tax period must prepare and maintain audited financial statements. So must a qualifying free zone person, with no revenue threshold attached — a QFZP earning modest revenue is still in.

Article 2(2) deals with tax groups separately: a tax group shall prepare and maintain audited special purpose financial statements in accordance with the form, procedures and rules specified by the Authority. That is a different deliverable from an ordinary statutory audit, and the phrase "special purpose" is doing real work.

Article 2(4) adds a rule for non-residents: in calculating the revenue threshold, only revenue derived through permanent establishments or nexuses in the State is taken into account.

For tax, the answer is unambiguous. Under Article 2(1)(b) of Ministerial Decision No. 84 of 2025, every qualifying free zone person must prepare and maintain audited financial statements, whatever its revenue. A free zone company that wants the 0% qualifying income rate cannot skip the audit.

For licensing, the answer depends on which free zone you are in, and there is no single federal rule. Each free zone authority sets its own requirements for filing audited statements as a condition of licence renewal, and many maintain their own list of approved or registered auditors whose reports they will accept.

We are not going to publish a zone-by-zone table or reproduce any free zone's approved-auditor list here. Those lists change without notice and a stale copy is worse than none. Check the register published by your own free zone authority, and confirm the firm is on the current version before engaging it.

Economic Substance Regulations obligations are still marketed as a recurring compliance service across the UAE advisory market, and for most businesses that is now out of date.

The Ministry of Finance announced the cancellation of economic substance reporting requirements for companies for financial years ending after 31 December 2022, under Cabinet Decision No. 98 of 2024, which amends Cabinet Decision No. 57 of 2020. The Ministry framed the change as aligning with the introduction of the federal corporate tax regime.

What has not gone away is history. The Ministry's announcement is explicit that companies remain responsible for fulfilling compliance obligations for prior years, and for any penalties imposed by the Federal Tax Authority. Notifications and reports for financial years ending on or before 31 December 2022, and any penalties arising from them, still stand.

If you are being quoted an annual fee for ESR filings covering a current financial year, ask which financial year the filing relates to before paying it.

External or statutory audit is an independent opinion on whether financial statements give a fair view, delivered to shareholders and required by law. Internal audit is a management function: an ongoing, in-house assessment of risk, controls and governance, reporting to the board or an audit committee rather than to the general assembly.

The two are not substitutes, and the independence rules make that clear. Article 246 of the Commercial Companies Law bars the statutory auditor from holding any technical, administrative or executive office in the company — which is precisely what an internal auditor holds.

Internal audit in the UAE is not mandated by the Commercial Companies Law for private companies generally. Where it is required, the requirement usually comes from sector regulation, from a listing rule, or from the company's own governance framework rather than from company law.

"How much does an audit cost in Dubai" is one of the most-searched questions in this topic and one of the least honestly answered.

There is no published tariff. Audit fees are not regulated by the Ministry of Economy or by any free zone authority, and for public joint stock companies Article 245(3) of the Commercial Companies Law hands fee-setting to the general assembly on a case-by-case basis. Any page quoting you a firm range is quoting its own price list, or someone's guess.

What we can tell you is what actually drives the number: transaction volume rather than revenue, the number of entities and whether consolidation is needed, the quality of the bookkeeping the auditor receives, whether related-party transactions require transfer pricing analysis, inventory and whether a physical count must be observed, the number of banks and currencies, and how much of the prior year the auditor has to re-perform if this is a first-year engagement.

The cheapest quote is frequently the one that assumes clean books. If yours are not, the fee moves — and it moves after you have signed.

Most audit delays in practice come from the same handful of gaps, and all of them are fixable before fieldwork starts.

Searches for the top audit firms in Dubai, the big ten, or the big five return page after page of rankings, and essentially none of them disclose a methodology. We are not going to add another.

The firms usually meant by "Big Four" are Deloitte, PwC, EY and KPMG. Beyond that, terms like "big five" and "big ten" are marketing constructs rather than defined categories, and the composition changes depending on who is publishing the list and why.

The questions that separate firms are more mundane and more useful than any ranking: is the firm licensed to practise in the State and, where relevant, on your free zone's current approved list; who signs the report and how many years have they signed it; does the engagement team include someone who understands your sector; will related-party and transfer pricing work be done by the audit team or referred out; and what is the fee if the books turn out to need work.

A firm that answers those directly is telling you more than a badge on a homepage.

Everything cited on this page is published free by the issuing authority, and none of it requires an intermediary to obtain.

The Commercial Companies Law (Federal Decree-Law No. 32 of 2021) is published by the Ministry of Economy and Tourism. Ministerial Decision No. 84 of 2025 on audited financial statements and the consolidated Corporate Tax Law are published by the Ministry of Finance. Economic substance material sits with the Ministry of Finance and the Federal Tax Authority. Federal Decree-Law No. 41 of 2023 on regulating the auditing and accounting professions is on the UAE Legislation portal.

Where a summary and a primary instrument disagree, the instrument governs. Several of the corrections on this page exist because a widely republished summary was out of date.