Senior accounting and auditing bodies have welcomed a new federal law setting high standards for registered auditors in the UAE, saying that it will contribute to the country’s economic growth.
Sheikh Khalifa, President of the UAE, signed federal law No 12 of 2014 concerning the audit profession in December.
The law sets strict guidelines for the licensing of auditing firms and professionals, with would-be auditors obliged to hold at least a bachelor’s degree in accounting, or an equivalent qualification.
“In the past almost anyone could come and be an auditor,” said Salem El Esaye, the executive manager of the UAE Accountants and Auditors Association.
“It used to be that you could become an auditor if you had an engineering degree, now with the new law you need a degree in accounting. It’s now changing for the better.”
In addition, auditors will be required to undergo ongoing professional training to remain qualified.
A properly qualified audit community is essential to help ensure the UAE’s economic development, said Mr El Esaye.
“A solid economy is built on solid numbers, so the higher the education level for auditors, the better.”
Mr El Esaye was speaking at the Public Interest International Forum, held yesterday in Abu Dhabi, hosted by the Abu Dhabi Accountability Authority in collaboration with the Public Interest Oversight Board.
Detailed bylaws pertaining to the new law are expected to be unveiled by the Ministry of Economy in the next six months.
Other elements of the law include the requirement that publicly listed companies change their auditors every four years, to help preserve auditors’ independence.
While the changes introduced by the law are wide-ranging, the majority of audit firms in the UAE have had ample time to adjust their practices, according to Riyad Al Mubarak, chairman of the Abu Dhabi Accountability Authority.
“Before the new law was issued it had already been discussed widely with the concerned entities, so it didn’t come as any great surprise,” he said.
The UAE currently has 720 registered auditors, 427 of whom are Emirati, said Mr El Esaye.