The UAW is a country with a diverse economy, and this is reflected in the different types of accounting practices that are used in the country. In this blog, we will take a look at some of the most common accounting practices in the UAE, and we will discuss the factors that businesses should consider when choosing an accounting practice. Accounting is a very vast field in UAE and in every company, accountants are required. It is crucial for companies to know about the types of accounting practices in the UAE.
Cash Accounting
Cash accounting is a simple accounting method that records transactions only when cash is paid or received. This method is often used by startups or small businesses, as it is relatively easy to track. However, cash accounting can be accurate, as it does not take into account accounts payable and accounts receivable.
Accrual Accounting
Accrual accounting is a more complex accounting method that records transactions when they occur, regardless of when cash is paid or received. This method is considered more accurate than cash accounting, as it takes into account all of a business’s liabilities and assets. However, accrual accounting can be more tough to track, and it may require the use of specialized accounting software.
International Financial Reporting Standards (IFRS)
IFRS is a set of accounting standards that are used by businesses around the world. IFRS is more complex than accrual or cash accounting but is also more accurate. IFRS are needed for all publicly traded companies in the UAE, and they are also becoming increasingly common for private companies.
Islamic Accounting
Islamic accounting is a set of accounting standards that are based on Islamic accounting prohibits the paying or charging of interest, Islamic principles, and also specific rules for the treatment of investments and profits. Islamic accounting is becoming increasingly popular in the UAE, as the country has a large number of Muslim residents.
The choice of accounting practice on a number of things, including the size of the business, the type of business, and the local regulations. Businesses should carefully consider their needs before selecting accounting practices.
Here are some additional factors that companies should when choosing an accounting practice:
- The complexity of the business’s operations
- The level of detail that is required for financial reporting
- The cost of the qualified accountants
- By considering these factors, businesses can choose an accounting practice that is right for them
These are some of the accounting practices to follow:
Cost accounting :
Cost accounting is a system of accounting that tracks the costs of producing goods or services. This information can be used to make decisions about pricing, production, and inventory levels.
Management accounting :
Management accounting is a system of accounting that provides information to managers to help them make decisions about the company’s operations. This information can include financial data, as well as non-financial data such as customer satisfaction and employee turnover.
Tax accounting :
Tax accounting is the process of preparing and filing tax returns for a company. This involves understanding the tax laws that apply to the company and complying with those laws.
ebs likewise offer services, such as accounting and bookkeeping services, VAT services, Auditing, Due Diligence audit services, and many more.
Feel free to contact us with any additional inquiries or requests for accounting services. A free discussion will be given to you by our specialists, who will answer your request immediately.