The Jebel Ali Free Zone in Dubai is one of the foremost business areas in the city. The area is renowned for its attraction to foreign investors and individuals interested in trading activities in the UAE at large.
The area is home to several foreign businesses and facilities, supported by top-notch infrastructural facilities and services. Alongside this, on a governmental and policy level, there are numerous advantages for companies to benefit from, including trade incentives.
Owing to its location and several incentives available to traders and investors, Jafza has seen phenomenal growth over the years, attracting well-known organizations from across the world.
The region is currently hosting over 6000 companies that have their origins worldwide, including those from the Middle East, Europe, South East Asia, and Africa. The number of businesses located here has risen more than three and a half times since the year 2000.
One of the key selling points of the free zone is its novel location between Dubai airport and the regional seaport. The area is supported by a highway based on six lanes, which plays an important part in cutting down transportation durations from and to carrying aircraft.
Owing to the scale of business and the size of competing interests, an auditing firm in Jafza ought to be full service and carry with itself a great deal of experience in free zone accounting processes to be of beneficial use to trading entities.
Auditing Firms And Organizational Risks
The management of a company has the duty to keep control risk at a minimum, and within acceptable limits.
In this case, the presence of a risk refers to a misrepresentation that control mechanisms would not otherwise be able to rectify before the accounting epoch comes to an end.
Within Internal Processes
Leaving aside the internal controlling mechanisms, internal risks refer to the possibility of an account being misrepresented owing to an error or illegal activity. The contributing factors may originate from within or outside the company, including macroeconomic developments. In a policy environment not favorable to the corporate sector, for example, it may be difficult to procure loans for investment and expansion a business otherwise planned for, adding to external risks.
Strictly within the company’s influence are issues such as the ability and expertise of its accounting professionals. Even as the organizational needs are multifaceted and seemingly complex, if the management fails to make changes to the auditing staff so that they may be able to cater to these needs, risks based on internal processes are likely to occur.
Together with control risks, those from internal processes translate into material misrepresentations, and this falls outside the ambit of the role of an auditor.
Auditing Firms And Accountant Risks
Within The Audit Process
A risk originating strictly from the audit aspect refers to the possibility of an expert giving the financial and operational processes a clean chit in terms of material representations, while the reality is to the contrary.
Since risks pertaining to internal processes and controls are to be handled by the management, often the overall handling will involve the auditor taking a more proactive role as to how much compliance he needs from the management in order to drive audit exposure down.