Inventory audit services in Dubai, UAE
Inventory is one of the most important assets of a company. In the supply chain process, inventory management protects the company from stock-outs, controls deliveries to multiple locations, and keeps accurate records. Effective inventory management is essential for every small, medium, or large company. The UAE government has set authoritarian laws and regulations on the stock-checking process. Therefore, it is advisable for every company to outsource to experts in the field of stock audit in Dubai and save their ears from penalties for non-compliance.
What is stock/inventory auditing?
A stock audit can also be described as an inventory check. Inventory control is a routine business activity, but sometimes management fails to regulate proper inventory recording and verification in accordance with auditing laws. To overcome this problem, companies choose to hire professional audit firms in the UAE to prove the accuracy, maintenance, and ownership of inventories. The main objective of an inventory audit is to gain a better understanding of the current inventory records and to reconcile existing inventory records.
Scope of Inventory Audit Services in Dubai
An inventory/stock audit is carried out to analyze the inventory levels of a company with the recorded inventory records. It ensures that the financial records of the stock are accurately maintained in the accounting software database. The company deals with different types of stock such as fast-moving stock, slow-moving stock, damaged stock, unserviceable stock, and obsolete stock. Therefore, once a year or twice a year, organizations should apply an inventory control process to properly manage the classification of these inventories. This is usually carried out by banks and financial institutions on behalf of their corporate customers who have used these stocks to secure loans.
The stock verification process will check whether the stocks are expired, obsolete, or damaged. Our stock verification service in Dubai also ensures that both surplus and shortage stock is accounted for. We check your stock statistics and help management protect stock from damage and fraud.
Key aspects of inventory control
The accuracy of inventory records is also very important for a robust accounting system and MIS reporting. These are the key aspects of an inventory control report in the United Arab Emirates:
- Inventory records
- Stock reconciliation
- Physical stock reports
- Stock valuation
- Stock coding
- Stock categorization
How do We Carry out a Stock Audit in the UAE?
The stock audit process in the United Arab Emirates requires proper planning, experience, and knowledge of audit laws. There are a few key things we notice when conducting stock audits in Dubai and other Emirates. We prepare and assess the age, suitability, movement, acquisition, and market price, as well as the direct and indirect costs of inventories. In this way, the existence, accuracy and rightful ownership of the company’s goods are guaranteed.
Our stock audit services in Dubai, UAE, ensure compliance with International Accounting Standard 2 for your stock check. Under IAS 2, inventories should be valued at a lower cost or net realizable value (NRV). It specifies allowable costing methods, including specific identification (in some cases), accounting for most types of stock, first-in-first-out (FIFO) accounting, and weighted average cost. The objective of IFRS 9 which was implemented after January 01, 2018, is to prescribe the cost of inventories, cost formulae for calculating inventories, inventory accounting treatment, and recognition of expenses, including NRV.
Inventory/Inventory Audit Procedures
Inventories often move around during working days, making it difficult for organizations to carry out routine physical checks. The company or a third-party auditor can conduct an inventory audit in Dubai, UAE to identify any issues in the organization’s stock storage and accounting methods. They fully assist you with the mandatory inventory control and verification audit procedures. Management can choose the audit process or the auditors can suggest a suitable inventory audit process. A list is given below:
- Cut-out analysis
- Physical inventory
- Analytical procedures
- ABC analysis
- Freight cost analysis
- Finished goods cost analysis
- Overhead cost analysis
- Reconciling items
- Reconciliation of invoices to the dispatch journal
Choose BestaxCA for stock audit services in Dubai
Bestax chartered accountants and business consultants help small and large businesses with accounting and auditing services in Dubai. We are associated with the country’s top auditors to help you with tax audit, internal audit, and liquidation audit and stock/inventory audit services in the UAE. Our team is qualified enough to manage your low-volume inventories as well as high-volume inventories in compliance with regulatory requirements. We are proficient in verifying your physical stock against the stock recorded in the software. Where necessary, they classify and re-categorize your stock, identify gaps in your current stock management and recommend the best solutions. BestaxCA helps you to better understand your stock portfolio as well as to properly reconcile your stock records. Get the best inventory audit services in Dubai and make sure your inventory is accurate and up-to-date. Contact us!