Financial Statements Compilation Service UAE — IFRS IFRS for SMEs Licensed Auditor Abdelhamid & Co CPA

Financial Statements Compilation Service UAE — IFRS & IFRS for SMEs Financial Statements for UAE Businesses

Quick answer: A financial statements compilation is the preparation of financial statements — statement of financial position, profit and loss, changes in equity, cash flows, and notes — from information provided by management, using accounting expertise to apply the correct accounting framework (IFRS or IFRS for SMEs) without providing assurance on the accuracy of the underlying records. Compilation engagements are governed by International Standard on Related Services 4410 (Revised) — Compilation Engagements (ISRS 4410). In the UAE, compiled financial statements are the standard deliverable for businesses not required to undergo a statutory audit — those with revenue below AED 50 million and that are not Qualifying Free Zone Persons under Ministerial Decision No. 82 of 2023 — and they form the mandatory basis for the Corporate Tax return under Art. 20 of Federal Decree-Law No. 47 of 2022 on the Taxation of Corporations and Businesses. Abdelhamid & Co — Ministry of Economy Licensed Auditor LC0106-01 | Registry No. 956 — compiles IFRS and IFRS for SMEs financial statements for UAE mainland LLCs, free zone entities, branches, holding companies, and professional firms, with the statements structured to satisfy Corporate Tax, free zone, bank, and regulatory requirements.

Abdelhamid & Co Certified Public Accountants & Auditors LLC is fully authorised to practice as a licensed auditor and accounting services provider in the UAE: Ministry of Economy Licence LC0106-01 | Licensed Auditor Registry No. 956 | FTA Tax Agent TAN: 30003958 | Tax Agency TAAN: 20033908 | Emirates Accountants and Auditors Association (EAAA) Fellow No. 124 | International Arab Society of Certified Accountants (IASCA) Fellow No. 1361 | over 25 years of professional experience in UAE accounting, audit, and tax. Our financial statements team serves businesses across manufacturing, trading, real estate, hospitality, professional services, and technology sectors — delivering IFRS-compliant compiled financial statements that meet every regulatory, tax, and commercial purpose. Learn more about our broader accounting services or about the firm.

Overview — Financial Statements Compilation in the UAE

Every UAE business that files a Corporate Tax return, renews a free zone licence, applies for a bank facility, or presents accounts to shareholders requires financial statements that comply with the applicable accounting framework. For the majority of UAE businesses — those below the statutory audit threshold — compiled financial statements prepared by a licensed accounting firm represent the most cost-effective, compliant, and commercially accepted form of financial reporting.

A compilation engagement under ISRS 4410 (Revised) involves the accountant using professional expertise to collect the financial information provided by management, classify it according to IFRS or IFRS for SMEs, make necessary accounting adjustments (depreciation, accruals, provisions, lease liability recognition, foreign currency translation), and present it in the complete financial statement format required by the applicable standard. The accountant issues a compilation report clearly stating that no assurance is provided — management remains responsible for the completeness and accuracy of the information provided. This transparency is what distinguishes a compilation from a review or audit, and it is reflected in the cost and timeline of the engagement.

Since the introduction of Corporate Tax under Federal Decree-Law No. 47 of 2022, the quality and completeness of compiled financial statements has increased in importance: the Corporate Tax return is computed directly from the accounting net profit shown in the financial statements (Art. 20), and the FTA may request the financial statements during a Corporate Tax audit. Financial statements that are incomplete, do not comply with IFRS, or are not prepared by a licensed professional firm expose the taxable person to FTA challenge and potential tax assessment adjustment.

Legal & Regulatory Framework — Financial Statements in the UAE

  • Federal Decree-Law No. 32 of 2021 on Commercial Companies — Art. 26: all UAE companies must maintain proper accounting books and records; Arts. 78–80: LLC managers must prepare annual financial statements and present them to shareholders within the period specified in the MOA; Art. 237: public joint-stock companies must prepare annual audited financial statements within 3 months of financial year-end and publish them; Art. 244: the company's financial statements must reflect a true and fair view of the financial position.
  • Federal Decree-Law No. 47 of 2022 on the Taxation of Corporations and Businesses (Corporate Tax Law) — Art. 20(1): the taxable income of a taxable person is determined on the basis of the net profit or loss as per the financial statements prepared in accordance with IFRS, or IFRS for SMEs where applicable, for the relevant tax period; Art. 54: taxable persons must prepare and maintain financial statements; Art. 55: financial statements and underlying accounting records must be retained for 7 years from the end of the relevant tax period; Art. 56: the Minister of Finance may prescribe the accounting standards to be used.
  • Cabinet Decision No. 75 of 2023 on the Administrative Provisions for the Implementation of Federal Decree-Law No. 47 of 2022 — confirms that taxable persons may use IFRS for SMEs as an alternative to full IFRS provided: (a) they are not required to prepare financial statements under full IFRS by any other applicable legislation; and (b) their revenue does not exceed AED 50 million in the relevant tax period. Qualifying Free Zone Persons must use full IFRS.
  • Ministerial Decision No. 82 of 2023 on the Determination of Categories of Taxable Persons Required to Prepare and Maintain Audited Financial Statements — specifies that the following categories must have their financial statements audited (not merely compiled): (a) taxable persons with revenue exceeding AED 50 million in the relevant tax period; and (b) Qualifying Free Zone Persons (QFZPs). All other taxable persons satisfy the Art. 54 obligation with compiled financial statements prepared by a licensed accounting firm.
  • International Standard on Related Services 4410 (Revised) — Compilation Engagements (ISRS 4410) — the IAASB international standard governing compilation engagements: the accountant uses expertise to assist management in the presentation of financial information; the accountant does not verify, audit, or review the information provided; management is responsible for the accuracy and completeness of the information; the accountant issues a compilation report disclosing the basis of preparation, the applicable framework, and a statement that no assurance is expressed.
  • International Financial Reporting Standards (IFRS) — required for listed companies (DFM, ADX) and for Qualifying Free Zone Persons; the standard framework for all Corporate Tax return financial statement preparation under Art. 20 of FDL 47/2022; comprises the full suite of IFRS standards including IFRS 16 (Leases), IFRS 15 (Revenue), IAS 2 (Inventories), IAS 16 (Property, Plant and Equipment), IAS 36 (Impairment), IAS 37 (Provisions), IAS 21 (Foreign Currency), IAS 12 (Income Taxes — Corporate Tax provision and deferred tax), and IAS 19 (Employee Benefits — end-of-service gratuity).
  • IFRS for Small and Medium-Sized Entities (IFRS for SMEs) — the simplified IFRS framework applicable under Cabinet Decision No. 75 of 2023 to taxable persons with revenue not exceeding AED 50 million; provides significant simplifications over full IFRS including: simplified revenue recognition, no goodwill impairment testing, simplified financial instrument treatment, and no deferred tax for many SME transactions; requires the same financial statement structure as full IFRS but with reduced disclosure requirements.
  • Federal Decree-Law No. 8 of 2017 on Value Added Tax, Art. 78 — requires VAT registrants to retain all accounting records supporting the financial statements for 5 years from the end of the relevant tax period (15 years for real estate records).
  • Free Zone Authority Requirements — the majority of UAE free zone authorities (DIFC, ADGM, JAFZA, DAFZA, RAKEZ, Sharjah-based free zones, and others) require the annual submission of financial statements — compiled or audited depending on the authority and the entity size — as a condition of annual licence renewal. DIFC and ADGM entities are subject to their own accounting and financial reporting regulations.
  • UAE Central Bank & Bank Lending Requirements — UAE commercial banks require audited or compiled financial statements (typically covering the last 2–3 years) as part of the credit assessment for loans, overdrafts, letters of credit, and other facilities. Compiled financial statements prepared by a licensed firm and accompanied by a compilation report are generally accepted for SME credit applications up to specified facility thresholds.

Key Facts — Financial Statements Compilation UAE

  • Governing standard: ISRS 4410 (Revised) — Compilation Engagements (IAASB)
  • Applicable framework: Full IFRS (mandatory for listed entities, QFZPs, revenue >AED 50M) | IFRS for SMEs (permissible for revenue ≤AED 50M per Cabinet Decision No. 75 of 2023)
  • Audit vs compilation threshold: Audit mandatory for revenue >AED 50M and for Qualifying Free Zone Persons (Ministerial Decision No. 82 of 2023); compilation sufficient for all other taxable persons
  • Corporate Tax basis: Compiled financial statements are the mandatory basis for CT return under Art. 20 of Federal Decree-Law No. 47 of 2022
  • Retention period: 7 years from end of relevant tax period (Art. 55, Federal Decree-Law No. 47 of 2022)
  • Small Business Relief: Revenue ≤ AED 3M: taxable income treated as zero (Cabinet Decision No. 73 of 2023) — financial statements still required as the basis for the CT return
  • No assurance provided: A compilation report does not express audit or review assurance — management remains responsible for the completeness and accuracy of the information
  • Financial statements components: Statement of financial position | Statement of profit or loss and OCI | Statement of changes in equity | Statement of cash flows | Notes (including accounting policies, CT disclosure under IAS 12, related-party disclosures)
  • Free zone licence renewal: Most UAE free zones require annual financial statements — compiled or audited — as a condition of licence renewal
  • Bank credit applications: Compiled financial statements from a licensed firm accepted for UAE SME credit facility applications
  • Firm credentials: Ministry of Economy LC0106-01 | Licensed Auditor No. 956 | FTA TAN: 30003958 | EAAA Fellow No. 124 | IASCA Fellow No. 1361 | 25+ years experience

Our Financial Statements Compilation Services

1. Annual IFRS Financial Statements Compilation

We compile the complete set of annual financial statements in accordance with full International Financial Reporting Standards — statement of financial position, statement of profit or loss and other comprehensive income, statement of changes in equity, statement of cash flows, and notes including accounting policies, IFRS standard disclosures, Corporate Tax provision and deferred tax under IAS 12, end-of-service gratuity under IAS 19, related-party disclosures under IAS 24, segment information where applicable, and all other disclosures required by the applicable IFRS standards. We ensure the financial statements present a true and fair view of the financial position and performance of the business for the year, and comply with Art. 20 of Federal Decree-Law No. 47 of 2022 as the basis for the Corporate Tax return.

2. IFRS for SMEs Financial Statements Compilation

For UAE businesses with revenue not exceeding AED 50 million that qualify to use IFRS for SMEs under Cabinet Decision No. 75 of 2023, we compile financial statements in accordance with the IFRS for Small and Medium-Sized Entities standard — applying the simplified recognition and measurement requirements while maintaining all required disclosure components. IFRS for SMEs financial statements reduce the disclosure burden compared to full IFRS, while fully satisfying the Art. 20 of FDL 47/2022 Corporate Tax return basis requirement and the free zone and bank submission requirements applicable to SMEs. We confirm at the outset whether full IFRS or IFRS for SMEs is the appropriate framework for the specific entity.

3. Free Zone Entity Financial Statements for Licence Renewal

UAE free zone authorities — including JAFZA, DAFZA, RAKEZ, Sharjah Airport International Free Zone (SAIF Zone), Hamriyah Free Zone, Ajman Free Zone, and others — require the annual submission of financial statements as a condition of licence renewal. Requirements vary by authority: some accept compiled financial statements accompanied by a compilation report; others require reviewed or audited statements above specified revenue thresholds; a small number (notably DIFC and ADGM entities) are subject to their own accounting regulations. We compile the financial statements in the format required by the specific free zone authority, confirm submission requirements, and provide the accompanying compilation report in accordance with ISRS 4410.

4. Interim Financial Statements (Quarterly & Half-Year)

Management, banks, investors, and some free zone authorities require interim financial statements — typically quarterly or half-yearly — in addition to annual statements. We compile interim financial statements applying IAS 34 Interim Financial Reporting (for full IFRS entities) or the equivalent IFRS for SMEs provisions, including the condensed statement of financial position, condensed profit and loss, and explanatory notes covering significant events and transactions in the period. Interim financial statements prepared by a licensed accounting firm strengthen lender confidence, support management decision-making, and satisfy covenants in banking facilities that require periodic financial reporting.

5. Multi-Period Comparative & Opening Balance Financial Statements

UAE businesses applying for bank facilities, preparing for a business sale, or bringing their accounting up to date after a gap typically require financial statements for 2–3 prior years presented on a comparative basis. We compile multi-period financial statements — restating or reconstructing prior-period figures where accounting policies have changed or where prior statements were not prepared in compliance with IFRS — and produce opening balance statements for new entities or for the first year of Corporate Tax compliance. Consistent accounting policies are applied across all periods to ensure comparability under IAS 8.

6. Corporate Tax Return Basis Financial Statements

The Corporate Tax return under Federal Decree-Law No. 47 of 2022 is computed starting from the accounting net profit per the financial statements (Art. 20). Financial statements that have not been prepared in accordance with IFRS or IFRS for SMEs — or that omit key adjustments such as depreciation, provisions, accruals, or IFRS 16 lease liabilities — produce an incorrect starting point for the Corporate Tax computation, leading to either over- or under-statement of taxable income. We compile financial statements specifically structured to serve as the Corporate Tax return basis, with all IFRS adjustments correctly applied and documented, the IAS 12 Corporate Tax provision computed, and the taxable income bridge from accounting profit to taxable income clearly supported by the financial statement workings.

Our Financial Statements Compilation Methodology

  1. Engagement Acceptance & Management Responsibility Letter: We confirm the engagement scope — entity, financial year-end, applicable framework (full IFRS or IFRS for SMEs per Cabinet Decision No. 75 of 2023), and intended use of the compiled statements. We issue an engagement letter and a management responsibility letter confirming that management is responsible for the completeness and accuracy of the information provided, and that the financial statements will be compiled in accordance with ISRS 4410 (Revised).
  2. Information Gathering & Trial Balance Review: We obtain the trial balance, general ledger, bank reconciliations, aged debtors and creditors, fixed asset register, payroll records, loan and lease agreements, related-party transaction schedules, and any other information required to compile the financial statements. We review the trial balance for completeness and identify any missing accruals, provisions, or adjusting entries needed to comply with the applicable IFRS framework before compilation begins.
  3. IFRS Adjustments & Accounting Policy Application: We apply the required IFRS adjustments to the trial balance — depreciation on property, plant and equipment (IAS 16), provision for impairment of receivables (IFRS 9 expected credit loss model), end-of-service gratuity accrual (IAS 19), lease liability recognition (IFRS 16), revenue recognition adjustments (IFRS 15), foreign currency translation (IAS 21), and Corporate Tax provision including deferred tax (IAS 12). We confirm that accounting policies are consistent with those applied in prior periods under IAS 8 and document any changes.
  4. Financial Statement Preparation & Notes Drafting: We prepare the four primary financial statements and the complete notes disclosure package — accounting policies, basis of preparation, property and equipment schedule, trade receivables and payables aging, loan and lease liability schedules, related-party disclosures (IAS 24), contingencies (IAS 37), and the IAS 12 Corporate Tax disclosure including the current tax provision and any deferred tax positions. We cross-reference all notes to the face of the financial statements and verify arithmetic accuracy throughout.
  5. Compilation Report Issuance & Delivery: We issue the compilation report in accordance with ISRS 4410 (Revised) — clearly identifying the applicable framework (IFRS or IFRS for SMEs), the compilation standard applied, and the statement that no assurance is expressed. The final financial statements package — statements, notes, and compilation report — is delivered in PDF format for regulatory submission and in working-paper format for Corporate Tax return preparation, free zone submission, and bank or investor use.

When Do UAE Businesses Need Compiled Financial Statements?

1. Annual Corporate Tax Return Filing

Every UAE taxable person registered for Corporate Tax must file an annual Corporate Tax return. Art. 20 of Federal Decree-Law No. 47 of 2022 bases taxable income on the accounting net profit per IFRS or IFRS for SMEs financial statements. Businesses that do not have compiled financial statements prepared by a licensed accounting firm cannot demonstrate to the FTA that the Corporate Tax return is grounded in a compliant accounting framework — exposing them to FTA challenge, tax assessment adjustment, and penalties under Art. 55 for failure to maintain adequate financial records.

2. Free Zone Annual Licence Renewal

The majority of UAE free zone authorities require the annual submission of financial statements as a condition of licence renewal. Entities that allow their licence to lapse — often because they did not prepare the required financial statements in time — face reinstatement fees, penalties, and visa complications. We compile the financial statements to the standard required by the specific free zone authority and provide the compilation report required to accompany the submission, ensuring licence renewal is not delayed by accounting non-compliance.

3. Bank Loan & Credit Facility Applications

UAE commercial banks require financial statements — typically for the last 2–3 financial years — as part of the credit assessment for business loans, overdraft facilities, letters of credit, and other facilities. Compiled financial statements prepared by a licensed firm (Ministry of Economy Licence LC0106-01) accompanied by a compilation report satisfy the lender's financial statement requirement for SME and mid-market credit applications, demonstrating that the financial position and performance figures have been prepared by a qualified professional applying a recognised accounting framework.

4. Shareholder Reporting & Investor Due Diligence

LLC shareholders are entitled to annual financial statements under Arts. 78–80 of Federal Decree-Law No. 32 of 2021 on Commercial Companies. Businesses seeking external investment, preparing for a partial sale, or admitting new partners must provide financial statements that accurately represent the business's financial position and performance over the relevant period. Compiled financial statements prepared in accordance with IFRS provide investors and incoming partners with a standardised, professionally prepared view of the business — at a lower cost than a full audit while satisfying the disclosure requirements of the transaction.

5. Government Tender & Regulatory Submissions

UAE government entities and many large private sector buyers require tenderers to submit financial statements — typically for the last 2–3 years — as part of the pre-qualification or tender documentation package. Compiled financial statements prepared by a licensed UAE accounting firm satisfy this requirement for most tender categories, providing the financial capacity evidence that procurement authorities require to assess whether the bidder has the financial strength to perform the contract.

Common Errors in UAE Financial Statements Compilation

1. Omitting IFRS 16 Lease Liability Recognition

IFRS 16 Leases (effective 1 January 2019) requires lessees to recognise a right-of-use asset and a corresponding lease liability on the balance sheet for all leases with a term exceeding 12 months (with exceptions for low-value assets). UAE businesses with office leases, warehouse leases, vehicle leases, or equipment leases that have not recognised the IFRS 16 lease liability in their compiled financial statements are presenting an understated balance sheet. For Corporate Tax purposes, the interest component of the IFRS 16 lease liability amortisation is subject to the general interest limitation rules under Arts. 29–31 of Federal Decree-Law No. 47 of 2022. Omitting IFRS 16 adjustments produces financial statements that do not comply with the Art. 20 requirement.

2. Not Applying IFRS 9 Expected Credit Loss on Trade Receivables

IFRS 9 Financial Instruments replaced the IAS 39 incurred-loss model with a forward-looking expected credit loss (ECL) model for trade receivables. UAE businesses must recognise an ECL provision against trade receivables — even where no specific debtor has defaulted — based on historical loss rates and forward-looking factors. Many compiled financial statements present trade receivables at gross value without an ECL provision, overstating assets and understating expenses. The IFRS 9 ECL provision is generally deductible for Corporate Tax purposes in the period it is recognised under Art. 28 of Federal Decree-Law No. 47 of 2022, provided it relates to a genuine business debt.

3. Incorrect or Missing IAS 12 Corporate Tax Provision

Since Corporate Tax became effective under Federal Decree-Law No. 47 of 2022 for financial years beginning on or after 1 June 2023, IFRS financial statements must include an IAS 12 Income Taxes disclosure: the current tax charge (9% of taxable income above AED 375,000), a current tax liability (or asset) on the balance sheet, and — where temporary differences exist between accounting and tax bases — a deferred tax asset or liability. Financial statements compiled without the IAS 12 Corporate Tax provision and disclosure are incomplete and do not satisfy the Art. 20 CT return basis requirement or the IFRS full disclosure obligation.

4. Preparing Financial Statements on a Cash Basis Rather Than Accruals Basis

IFRS — both full IFRS and IFRS for SMEs — requires the accruals basis of accounting: revenues are recognised when earned and expenses when incurred, regardless of when cash is received or paid. Many UAE owner-managed businesses maintain their books on a cash or near-cash basis — recording income only when received and expenses only when paid — and then present these cash-basis records as the financial statements. Cash-basis financial statements do not comply with Art. 20 of Federal Decree-Law No. 47 of 2022 and may significantly misstate taxable income. Compiled financial statements must include all necessary accruals and prepayments to convert the accounting records to a true accruals basis.

5. Inconsistent Accounting Policies Without Disclosure

Where accounting policies change between periods — for example, a change in depreciation method from straight-line to reducing balance, or a change in revenue recognition timing — IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors requires the change to be disclosed, the reason explained, and the effect on prior-period comparatives quantified. Many compiled financial statements silently change accounting policies between periods without IAS 8 disclosure, making prior-period comparatives non-comparable and potentially misleading to users — including the FTA reviewing the Corporate Tax return basis across multiple periods.

Why Choose Abdelhamid & Co for Financial Statements Compilation?

  • Ministry of Economy Licensed Auditor — LC0106-01 | Registry No. 956 — licensed to issue compilation reports under ISRS 4410 and to prepare financial statements accepted by the FTA, free zone authorities, UAE banks, and regulatory bodies.
  • FTA Tax Agent TAN: 30003958 | Tax Agency TAAN: 20033908 — compiled financial statements prepared by the same firm that files the Corporate Tax return, ensuring the Art. 20 taxable income basis is correctly structured from the financial statements through to the return under tax.gov.ae.
  • EAAA Fellow No. 124 | IASCA Fellow No. 1361 — recognised professional standing within the UAE and Arab accounting and auditing community.
  • Over 25 years of professional experience — deep IFRS expertise across all standards (IFRS 16, IFRS 15, IFRS 9, IAS 12, IAS 19, IAS 37) applied across all UAE business sectors.
  • Full IFRS and IFRS for SMEs capability — we determine the correct applicable framework (Cabinet Decision No. 75 of 2023) and apply it consistently, ensuring the financial statements are appropriate for the entity's size, structure, and regulatory requirements.
  • Corporate Tax-integrated compilation — every set of compiled financial statements includes the IAS 12 Corporate Tax provision and is structured to support the taxable income computation and Corporate Tax return filing — eliminating the disconnect between the accountant's compilation and the tax adviser's return.
  • Free initial consultation — we assess the applicable framework, estimate the compilation timeline, and identify any IFRS adjustments needed before engagement.

Frequently Asked Questions — Financial Statements Compilation UAE

What is a compilation engagement and how does it differ from an audit or review?

A compilation engagement under ISRS 4410 (Revised) involves a licensed accountant using professional expertise to prepare financial statements from information provided by management — without verifying, auditing, or reviewing the underlying records. No assurance is expressed. A review engagement (ISRE 2400) involves the accountant performing analytical procedures and enquiries to provide limited assurance that the statements are free of material misstatement. An audit engagement (ISA 700) involves the auditor obtaining reasonable assurance through evidence-gathering procedures. Compiled financial statements are lower cost and faster to produce than reviewed or audited statements, and are sufficient for Corporate Tax returns (unless the entity exceeds the audit threshold under Ministerial Decision No. 82 of 2023), free zone licences, and most bank submissions for UAE SMEs.

Which UAE businesses need compiled financial statements?

Every UAE business registered for Corporate Tax under Federal Decree-Law No. 47 of 2022 must prepare financial statements as the basis for the Corporate Tax return (Art. 20). Businesses with revenue below AED 50 million that are not Qualifying Free Zone Persons satisfy this obligation with compiled financial statements — they are not required to have them audited under Ministerial Decision No. 82 of 2023. Additionally, most UAE free zone authorities require annual financial statements (compiled or audited) for licence renewal, and UAE banks require them for credit facility applications.

What accounting standards apply to compiled financial statements in the UAE?

Under Art. 20 of Federal Decree-Law No. 47 of 2022 and Cabinet Decision No. 75 of 2023: full IFRS applies to listed companies, Qualifying Free Zone Persons, and entities with revenue exceeding AED 50 million; IFRS for SMEs is permissible for entities with revenue not exceeding AED 50 million that are not otherwise required to use full IFRS. The choice of framework must be applied consistently and disclosed in the notes. Both frameworks require the same four primary financial statements — statement of financial position, profit and loss, changes in equity, and cash flows.

Do free zone companies need compiled financial statements for licence renewal?

Yes — the majority of UAE free zone authorities require the annual submission of financial statements as a condition of licence renewal. Requirements vary by authority: most accept compiled financial statements accompanied by a compilation report for entities below their audit threshold; some (including most DIFC and ADGM entities) require reviewed or audited statements under their own regulatory frameworks. We confirm the specific requirements of the relevant free zone authority at the start of each engagement and compile the statements in the required format and within the required timeline.

Can compiled financial statements be used for UAE Corporate Tax returns?

Yes — for most UAE taxable persons. Art. 20 of Federal Decree-Law No. 47 of 2022 requires taxable income to be computed on the basis of IFRS or IFRS for SMEs financial statements. Compiled financial statements prepared by a licensed accounting firm in accordance with ISRS 4410 and IFRS or IFRS for SMEs fully satisfy this requirement, provided the entity does not exceed the audit threshold under Ministerial Decision No. 82 of 2023 (revenue >AED 50M or QFZP status). For entities below the audit threshold, compiled financial statements are the standard and legally sufficient basis for the Corporate Tax return.

What does a compilation report say?

The compilation report issued under ISRS 4410 (Revised) states: the name of the entity and the financial period covered; that the engagement was conducted in accordance with ISRS 4410 (Revised); the applicable financial reporting framework (IFRS or IFRS for SMEs); that management is responsible for the preparation of the financial information and for the financial statements; that the accountant's role is to apply accounting expertise to assist in the preparation of the financial statements; and that no assurance — whether audit or review — is expressed on the financial statements. The compilation report is attached to the financial statements and is submitted alongside them to the FTA, free zone authority, or bank as applicable.

How long does it take to compile financial statements for a UAE business?

For a UAE SME with well-maintained accounting records (trial balance, bank reconciliation, aged debtors/creditors, and fixed asset register provided), the compilation of annual IFRS or IFRS for SMEs financial statements typically takes 1–3 weeks from receipt of complete information. Where accounting records require reconstruction, significant IFRS adjustments (IFRS 16, IFRS 9 ECL, IAS 19 gratuity), or multiple prior-year comparatives, the timeline extends to 3–6 weeks. We issue a document request list at engagement commencement to enable clients to gather information efficiently and minimise turnaround time.

When does a UAE business need a statutory audit instead of a compilation?

Under Ministerial Decision No. 82 of 2023, statutory audit of financial statements is mandatory for: (a) taxable persons with revenue exceeding AED 50 million in the relevant tax period; and (b) all Qualifying Free Zone Persons (QFZPs) — regardless of revenue. Additionally, public joint-stock companies (PJSCs) are required to have audited financial statements under Art. 237 of Federal Decree-Law No. 32 of 2021 on Commercial Companies. Free zone authorities may impose their own lower audit thresholds. All other UAE taxable persons may satisfy their financial statement obligations with compiled statements prepared under ISRS 4410.

Contact Our Financial Statements Team

To engage Abdelhamid & Co for financial statements compilation — annual, interim, free zone, or Corporate Tax basis — contact us today:

Abdelhamid & Co Certified Public Accountants & Auditors LLC — Ministry of Economy Licence LC0106-01 | Licensed Auditor Registry No. 956 | FTA Tax Agent TAN: 30003958 | Tax Agency TAAN: 20033908 | EAAA Fellow No. 124 | IASCA Fellow No. 1361

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About the Firm

Abdelhamid M. Abdelhamid — Partner & Managing Director
Ministry of Economy Licensed Auditor (LC0106-01, Registry No. 956) | FTA Tax Agent (TAN: 30003958) | Tax Agency (TAAN: 20033908) | EAAA Fellow No. 124 | IASCA Fellow No. 1361 | Over 25 years of UAE accounting, audit, and IFRS experience | FTA Registered Tax Agent | LinkedIn

Last reviewed: 28 April 2026 — updated to reflect Federal Decree-Law No. 47 of 2022 (Corporate Tax Arts. 20, 54–56), Cabinet Decision No. 75 of 2023 (IFRS for SMEs), Ministerial Decision No. 82 of 2023 (audit thresholds), Federal Decree-Law No. 32 of 2021 (Commercial Companies), ISRS 4410 (Revised), and full IFRS suite (IFRS 16, IFRS 15, IFRS 9, IAS 12, IAS 19, IAS 37).

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