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Revenue Audit

Revenue Audit assesses and verifies the accuracy of a company’s revenue streams to ensure compliance with tax regulations and optimize financial performance.

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A revenue audit is a two-step process that compares the figures and details on a company’s tax returns with those in its business reports. Typically, auditors examine income returns from the past year, but they will also review previous years’ records if inconsistencies arise.

Most businesses, regardless of size, are subject to audits. Auditors may focus on various areas, including financial statements, compliance, tax records, or business operations. For instance, during a revenue audit, a company’s tax returns will be compared with its financial reports.

What is Revenue Audit?

The revenue audit involves reviewing the tax return, inspecting the declaration of liability, and verifying compliance with stamp duty regulations, as well as ensuring the individual meets their obligations under tax and duty laws.

Additionally, the audit assesses the company’s liability by examining its books, records, and adherence to tax obligations. The auditor also calculates any unpaid taxes to ensure proper tax enforcement.

*NOTE: A single auditor can conduct the revenue audit, or if the organization is large, a team of revenue auditors may be assigned to the task.

Revenues Audit Objectives

The main goal of the Revenue Audit in the UAE is to ensure compliance with tax laws and regulations while identifying potential risks to the government’s revenue base.

Key objectives include:

  • Ensuring the accuracy of tax returns and adherence to tax laws and regulations.
  • Verifying the completeness and accuracy of tax revenues collected by the government.
  • Identifying potential risks to the government’s revenue and recommending ways to mitigate those risks.
  • Assessing the effectiveness of tax collection and enforcement processes.
  • Providing assurance to stakeholders that tax collection and enforcement are functioning effectively and efficiently.
 

Audit Procedures for Revenue Recognition

For an auditor to assess the risk of significant inaccuracies in statements, it is essential to understand the requirements of the new revenue recognition standard. For a comprehensive overview of this process, please reach out to Litrix.

The Notification

Once selected for the Revenue Audit, the organization will receive a written notice twenty-one (21) days prior to the scheduled audit date. This letter will clearly indicate the start date of the audit.

The letter will include the following details:

  • The nature of the Revenue Audit
  • The scope of the audit
  • The specific period covered by the audit
  • The possible use of advanced e-auditing techniques

The Qualifying Disclosure

Once the taxpayer receives the written notice following the issuance date of the letter, they can no longer make an “unprompted qualifying disclosure.”

However, the taxpayer can still prepare a “prompted qualifying disclosure” before the examination of books and records begins.

How can we help?

Litrix can assist our clients in preparing all the necessary requirements for their Revenue Audit. Our professional auditors are well-equipped to ensure compliance with tax and duty legislation.

With quarterly check-ups, we prioritize our clients’ financial well-being. This allows us to confidently maintain their tax obligations. Additionally, we will liaise with the Revenue Department to check for any outstanding fines or interest and devise the best possible solutions or settlements.

We are committed to securing a strong future for our clients by delivering the most effective services.

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OUR AUDIT SERVICES INCLUDE THE FOLLOWINGS:

Internal Audit
Due Diligence
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Recovery audit
Operational Audit
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Business Valuation Assurance
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To date we are providing Accounting Services for more than 250 clients
across the UAE in Trading, Construction, Real estate, Healthcare,
Logistics and other services.
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