A business operating in the UAE must concentrate on financial and accounting records to avoid uncertainties in the future. This is the key to a successful business to always update and be compliant with the changing regulatory provisions. Each company needs to update its backlog accounts as per requirements.
Bestax Chartered Accountants offers professional backlog accounting services in Dubai, Sharjah, Abu Dhabi, Ajman, and other Emirates of the UAE. We assure higher quality services with 100% guaranteed results to all our domestic and international clients. Let’s understand the importance and our offering regarding backlog updates.
Backlog accounting is the practice of recording all transactions from day one of the business incorporations. The financial and accounting records should be maintained and updated at the initial stages under regulatory guidelines. Backlog accounting shows exactly where a company stands. Many times businesses were incompetent to proceed with backlog requirements at the time of establishment. Therefore, you must prepare in advance in case a stakeholder, business partner, or Federal authorities asks you about your account history.
Under the UAE commercial company law, a registered entity has to maintain and update all books of accounts and reports since the business’s inception. The companies must have records from the date of incorporation till the current date. Their compliance with the FTA regulations and provisions is also essential to avoid penalties. Updating the backlog is a tricky process that requires expertise in the field of accounting. Companies should look for a reputable accounting firm in UAE to prepare their accounting books.
The backlog records preparation is really significant for startups as well as SMEs in the United Arab Emirates. Newcomers have a harder time fulfilling backlog requirements, which leads to penalties and fines from authorities. The history of records helps management and strategists while making calculative decisions. It boosts the company’s profit by calculating costs and reducing overheads. A business can stay competitive by updating backlog accounts in order to avoid problems and sanctions from authorities. The accountant must implement accounting software for updating backlog accounts in the best manner. Therefore technological advancement helps business owners to analyze data as well as stay updated with the industrial revolution.
There are multiple reasons why organizations fail to maintain backlog accounts as per regulatory guidelines.
While compiling backlog accounting records, outsourced accountants must generate reports to provide insight into business performance. This reporting is compulsory for each company operating in UAE to predict the future financial situation. The most important reports that must be updated after backlog accounting are mentioned below:
Outsourcing backlog accounting in UAE benefits many small and medium-sized businesses by clearing up their transactions. Some of them are discussed below:
First of all, the backlog accounting information helps the business owner to track the financial condition of the accounts. Once the backlog history is maintained by chartered accountants, they can assess each department’s contribution to generating profits. The department with the lowest productivity is notified and focuses on the next. It assists the management team to identify market trends and investment opportunities for the coming years. This calculated information benefits the organization as a whole.
Backlog accounting saves a lot of time and money for the business person. The proper maintenance of accounts helps a lot when an accountant wants to access an old file. Documents and information recorded in accounting software are accessible at any time and can be readily retrieved. These old accounting records are significant in future development plans and growth opportunities. The updated backlog accounts also escape entities from the penalties during the FTA inspections and safeguard your revenues.
The clear picture of company cash flow management is shown through the backlog records. Thoroughly reviewing the money coming in and out of your accounts helps to predict the financial health of the business. If the accounts are properly updated, it will enable management to better use funds than previously. Our accountants understand how important it is to manage funds and other financial transactions.
The reports generated after the completion of backlog accounting specifically support the management team in decision making. The information about previous durations helps upper-level management to decide whether it is profitable to work on a new project or not. They can make strategic decisions and action plans to improve the working of each department or unit.
The maintenance and updation of backlog accounting are the most beneficial at the time of FTA tax audits. The authorities inspect your financial records on just 5 days’ notice so it’s impossible that yearly information will be ready in just a few days. The proper backlog accounts play a significant role at the time of auditing to avoid non-compliance penalties and fines.
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