We would like to share our overview on recent trends in Audit and Advisory market of UAE. Please read below the major key points in the form of Questions and Answers.
What have been the most significant developments in the UAE accounting market over the last 12-24 months?
The most significant development in the UAE accounting market over the last 12-24 months is the introduction of Value Added Tax (VAT). Since VAT has already been implemented in the UAE effective January 1, 2018, opportunities for accounting, finance and tax professionals (as well as IT professionals) are growing rapidly nowadays. Companies in the UAE are dealing with challenges on the complexity of VAT that open the doors for experienced qualified accountants, tax consultants, auditors, and other professionals.
How would you describe the market in terms of level of demand from clients, competition for business and fee pressure?
The market is very competitive these days due to implementation of VAT. Demand from clients is moderately high since VAT has complex interpretations and procedures which require the assistance from tax consultants. However, since opportunities have opened to tax experts and consultants, many accounting and tax firms are offering VAT consultancy services at a lower/cheaper price just to win clients. Nevertheless, we are still offering our clients at a competitive price without compromising the good quality of our services.
Which business lines are most dynamic in the UAE?
Business lines that are most dynamic in the UAE are:
Manufacturing sectors that are producing a wide range of high quality and competitive export products such as fabricated metal products, textiles and ready-made garments, gold and jewelry, refined petroleum, chemical and non-metallic mineral products.
Foreign Trade Network – Dubai boasts an extensive foreign trade network thus offering the investor a good choice of potential global marketing outlets for a diverse portfolio of goods and services.
Where do you see potential for growth – and what are the future challenges facing this market?
The potential for growth is in the Real Estate sector since the UAE’s plan to grant long-term visas to the country’s foreign population, particularly investors and specialists will go a long way in reinforcing business confidence and igniting a sense of belonging among expatriates. The long-term visa programme will promote investment climate and boost business confidence and will have a large impact on domestic demand and sectors particularly the real estate.
The Tourism sector is growing naturally due to increasing number of visitors and with the upcoming Expo 2020 which will be held in Dubai, United Arab Emirates. Technological developments and innovations in businesses are the future challenges that this market has to deal with since approaches in providing the service to clients must be customized.
There is a possibility for growth in the Accounting/Tax firm as well since there would be a potential requirements for business entities to maintain audited financials which will enable the authorities to evaluate transactions which are impacted by VAT. The Companies will have to avail of the services of chartered accounting firms to represent them before the tax authorities. Future challenge is facing the competition in the market in providing good quality service at a competitive professional fees.
What are the other developments?
Along with legislation change on VAT introduction and implementation in UAE, another change is technology invasion into accounting world. Businesses in UAE are deploying top-notch accounting technology based solutions, for example, tech-based software for clients to monitor the document flow online, mobile applications and web-based solutions to sign documents from their smartphones, reduce paper flow and make clients life easier. Over the recent years the introduction of tech hubs in UAE managed by audit and advisory firms have brought up leading businesses together to bring more tech into accounting processes. Our clients are deploying cryptocurrency into their operations and we are here to support them from our side.
According to the Global Power City Index, published in October 2018, Dubai is the only city in MENA Region that has retained its Top Position among the world’s top 44 powerful cities. Most of the business is concentrated in Dubai and new businesses are opening every minute. The market potential is continuously growing due to highly positive investor environment that was created by the Ruler of Dubai. One of the recent and greatly accepted initiatives from the Government is the long-term visas introduction for investors. This brings more business for accounting and advisory firms as well. The firms are extending the scope of services by adding “business set-up” and “company formation services”.