The UAE in general and Dubai, in particular, is home to a number of shopping malls that cater to the needs of luxury-craving citizens and residents. Each shopping mall has a great number of retail businesses as its tenants who are required to conduct a specific form of audit called audit of sales or gross turnover audit. The retail businesses should conduct an audit of sales and submit a gross turnover statement audited by approved auditors in UAE to the shopping mall authorities.
Since audit of sales is a mandatory annual requirement for retail businesses operating in shopping malls, it is best to hire experienced auditors from the best audit firms in Dubai. In this article, we provide you with some useful insights into the definition, process, and benefits of performing the audit of sales in Dubai, UAE. Read ahead.
Why is Audit of Sales Required?
Shopping malls in the UAE have made it mandatory for their retail tenants to submit a State of Gross Turnover as per the terms in the Lease Agreement. The gross turnover is the total sales generated by the retail business every financial period. The auditor conducts the audit of sales and submits the turnover report after verifying the revenue/Gross Sales generated by an entity for a particular period.
Audit of sales has been adopted by almost all premium Mall managements or property managements who charge a certain percentage of amount from the retail tenants based on the revenue generated by them. Retail audits in the UAE help businesses get an accurate picture of the gross sales generated. Sometimes, if the gross sale is low, the retail tenants use the audited gross sales statement to negotiate with the mall management for rent reductions. Approaching the best audit firms in Dubai for conducting the audit of sales is recommended to ensure that the auditor has prior retail experience.
How Auditors Conduct Audit of Sales in the UAE?
The audit engagement will be conducted as per an accepted standard that is relevant to the agreed-upon procedures. During an audit of sales in the UAE, the auditors in Dubai will conduct the following procedures,
- Daily sales will be reviewed on the basis of supporting documents
- The UAE auditors will prepare and issue the audit report in accordance with the terms stated in the lease agreement
- Verification will be done to ensure that the gross sales report and the invoice wise listing of the sales for the lease period is in agreement with the books of accounts or related general ledger
- A vouching will be conducted on sample invoices from the sales report & will match the sales amount with the invoice listing
- Checks will be conducted to ensure the accuracy of the gross sales statement
- Auditors will examine the current internal control system on the revenue/invoice cycle to verify the completeness, accuracy and adequacy of sales records
Benefits of Audit of Sales
An audit of sales helps the mall management to get an accurate financial picture of the business in the malls. It gives them the right direction to proceed as the auditors in Dubai will provide actionable insights and recommendations in the audit report. Apart from that, the following are the major benefits of conducting a sales audit in the UAE:
- A sales audit in the UAE provides a review of the sales collection process and identifies control deficiency
- A sales audit helps the mall management to ensure the tenant is complying with the lease agreement
- Retail auditors in Dubai, UAE, provide an assurance of reported gross sales to the landlord
Documents Checked By Auditors during Sales Audit
While conducting an audit of sales, the auditors will ask for a set of documents that will be analysed, compared and reviewed. The following are some of the most common documents required for a sales audit in the UAE:
- Monthly Sales Report from the point of Sales
- Bank Statement showing the credit of sales figure /revenue
- Bank statement showing the Cash sales deposits
- Trade License
Hire the Best Audit Firms in Dubai for Annual Sales Audit
While searching for UAE auditors for the sales audit, the mall management should exercise caution. It is recommended to avail services of those audit firms in Dubai that have immense experience in conducting the sales audit. Jitendra Chartered Accountants (JCA) is one such audit firm approved by nearly all the mall authorities in the UAE. JCA has a team of highly qualified auditors in Dubai who successfully perform more than hundreds of sales audits every year. JCA has made a mark in the highly competitive sales audit niche by offering quality services and an affordable pricing structure.