Auditors in Hamriyah Free Zone (HFZ)

The Hamriyah Free Zone (HFZ) is a thriving business hub in the United Arab Emirates, and like other free zones, it requires all registered companies to have their accounts audited by approved auditors. Know more about HFZA Approved Auditors.

Role of Auditors in HFZ:

Auditors in HFZ provide critical services, including conducting external audits of financial statements. They ensure that these statements comply with required standards, providing an accurate representation of a company’s financial situation.

This role enhances investor confidence and upholds the integrity of HFZ as a global business hub. 

Read more: Auditing Services in Abu Dhabi Airport Free Zone

Choosing the Right Auditor:

Several reputable audit firms are approved by HFZ to conduct audits. These include JCA UAE Audit, Bader Saleh Auditing, RVG Chartered Accountants, Parker Russell UAE, Farahat & Co, and A&A Associate LLC.

When choosing an auditor, consider factors such as the firm’s reputation, experience, understanding of HFZ regulatory requirements, and the range of services offered.

In conclusion, engaging with HFZ-approved auditors is crucial for businesses within the free zone. These professionals ensure financial transparency, compliance with regulations, and smooth operation of the company’s financial management processes.

Audit Services for Businesses Registered in the Hamriyah Free Zone

The Hamriyah Free Zone (HFZ) is a premier business hub located in Sharjah, United Arab Emirates. It offers an attractive and conducive environment for businesses with numerous benefits including 100% foreign ownership, tax exemptions, and a strategic location with access to major global markets.

However, to maintain its high standard of business integrity and transparency, HFZ mandates that all businesses registered within its jurisdiction undergo regular audits by approved auditors.

The Importance of Audits in HFZ:

Audits are crucial in maintaining the credibility and integrity of businesses operating in the HFZ. They provide an objective examination of a company’s financial statements, ensuring accuracy, compliance with accounting standards, and transparency.

Audits also help identify any irregularities or discrepancies in the financial records, enabling businesses to address potential issues promptly.

Moreover, audits can provide valuable insights into a company’s financial health, helping stakeholders make informed decisions. For investors, a clean audit report can increase confidence in the business.

Selecting an Approved Auditor in HFZ:

HFZ has a list of approved auditors who are authorized to perform audits for companies operating in the free zone. These auditors are well-versed with the regulations and requirements of HFZ, ensuring that your business remains compliant.

When selecting an auditor, consider factors such as the firm’s reputation, experience, understanding of HFZ regulatory requirements, and the range of services offered. Some of the HFZ-approved auditors include JCA UAE Audit, Bader Saleh Auditing, RVG Chartered Accountants, Parker Russell UAE, Farahat & Co, and A&A Associate LLC.

Audit Services Offered in HFZ:

Approved auditors in HFZ offer a wide range of audit services, including:

Statutory Audit: This is a mandatory audit required by law. It involves a thorough examination of a company’s financial statements and records to ensure accuracy and compliance with accounting standards.

Internal Audit: This audit evaluates a company’s internal controls, including its corporate governance and accounting processes. It helps businesses improve their operations and mitigate risks.

Due Diligence Audit: This type of audit is typically conducted when a company is considering a merger, acquisition, or investment. It involves a comprehensive review of the company’s financial, legal, and operational status.

Forensic Audit: Forensic audits are used to investigate fraudulent activities. They involve a detailed examination of financial records to uncover any irregularities.

In conclusion, audit services play a vital role in maintaining the integrity and credibility of businesses in the Hamriyah Free Zone. By engaging with HFZ-approved auditors, businesses can ensure financial transparency, compliance with regulations, and smooth operation of their financial management processes.

Types of Business Licenses in HFZ:

Businesses looking to set up in the Hamriyah Free Zone (HFZ) in the United Arab Emirates can choose from several types of licenses depending on their activities and requirements. Here are the main types of business licenses available:

Industrial License: This license is for businesses engaged in industrial or manufacturing activities. It allows companies to import raw materials, manufacture, and process, assemble, package, and export finished products.

Commercial License: This license is issued to businesses involved in general trading, import, export, distribution, and storage of specific products. Businesses can also have multiple product lines under one license, subject to HFZ approval.

Service License: Service licenses are granted to those businesses that offer services such as consulting, IT services, logistics, courier services, etc. The service must be specified in the license.

Oil & Gas License: This license is specifically for businesses involved in oil and gas exploration, production, and related activities.

Offshore License: Offshore licenses are issued to businesses that wish to operate outside the UAE. These businesses are not allowed to carry out any commercial activity within the UAE.

Each of these licenses comes with its own set of rules, regulations, and benefits, so it’s important for businesses to understand their needs and objectives before choosing a license. Consulting with a business setup advisor or a legal expert can be helpful in making an informed decision.

Please note that all businesses in HFZ are required to renew their licenses annually and ensure they remain compliant with the rules and regulations of the HFZ Authority.

Benefits Associated with Operating in HFZ:

Hamriyah Free Zone provides business entities conducting operations in the free zone with the benefits mentioned below:

  • Total exemption from income, corporate, import or export taxes
  • 100% foreign ownership
  • No restriction on repatriation of profits and capital
  • Cost-effective workforce
  • Renewable long term lease
  • Onsite accommodation for labour
  • Onsite custom facilities
  • Modern infrastructure
  • Pre-build offices and warehouses
  • Low cost energy
  • Access to seven meter deep inner harbor and fourteen meter deep port

Why a Financial Audit is Required in Hamriyah Free Zone?

A financial audit is mandatory for all companies registered in the Hamriyah Free Zone (HFZ), as per the regulations of the HFZ Authority. The reasons for this requirement are manifold:

Financial Transparency and Accountability: An audit provides a clear, accurate, and transparent picture of a company’s financial health. It ensures that businesses operating in the HFZ are accountable for their financial operations.

Compliance with Regulations: An audit ensures that companies comply with the accounting standards and regulations set by the HFZ Authority. Any discrepancies or irregularities can be identified and rectified.

Confidence Among Stakeholders: Audited financial statements provide confidence to stakeholders including investors, customers, and the free zone authorities. It assures them that the company is operating legitimately and its financial reports are reliable.

Identifying and Mitigating Risks: An audit can help identify potential financial risks and suggest measures to mitigate them. This can improve the overall financial management of the company.

The audited financial statements must be submitted to the HFZ Authority within six months from the end of the relevant financial year. Approved auditors in HFZ, who are well-versed with the free zone’s regulations and requirements, conduct these audits.

Documents Required for External Audits in the Hamriyah Free Zone:

Specific Documents which are required by the auditors in hamriyah free zone are as follows:

  • General Ledgers
  • Trial Balance
  • Balance Sheet
  • Profit and Loss Statements
  • Details of fixed asset additions and disposals during the year with proper supporting
  • Audit schedules (bad debt provisions, depreciation, accruals)
  • Details of closing stock including working in progress at the year end
  • Copies of invoices and bills
  • Articles of Association (AOA)
  • Memorandum of Association (MoA)
  • Registration Details for Excise Tax and/or VAT (If Applicable)
  • Latest Trade License