At Calculate Capitals LLC, we work closely with CFOs, finance leaders, and audit teams across the UAE—and one truth is universal: a successful year-end audit is never a last-minute exercise. It is the result of disciplined month-end closes, clean reconciliations, complete documentation, and readiness that builds throughout the year.
Whether you lead a growing SME or a multi-entity group, this tailored CFO checklist will help you strengthen your financial reporting and ensure a smooth, delay-free audit cycle.
1. Strengthen Your Month-End Close — the Foundation of Audit Readiness
A streamlined month-end close is the most powerful way to eliminate audit surprises. At Calculate Capitals LLC, we often see that 70–80% of audit issues originate from inconsistent monthly practices.
✔ Complete monthly reconciliations without fail
Every balance sheet account should be reconciled before month-end is considered “closed.” Key focus areas include:
- Bank and cash accounts
- Accounts receivable and payable
- Accrued expenses
- Prepayments
- Payroll and statutory liabilities
- Fixed assets and depreciation
- Loans and interest accruals
Unreconciled items are the audit’s first red flag—clean them monthly, not at year-end.
✔ Apply clear cut-off procedures
Define and enforce policies for:
- Revenue recognition
- Recording supplier invoices
- Accruals and provisions
- Expense allocations
This ensures that financials reflect the correct reporting period—something UAE auditors look for carefully.
✔ Investigate variances every month
Large variances vs. budget, forecast, or prior periods should be documented as part of your monthly process.
When explanations are prepared in advance, the audit becomes significantly easier.
2. Build a Comprehensive Audit File — the Calculate Capitals Method
One of the biggest causes of audit delays is missing or incomplete documentation. Our asset advisory and financial review engagements always start with a well-structured audit file.
✔ Ensure core financial statements are ready
Prepare your:
- Balance Sheet
- Profit & Loss Statement
- Cash Flow Statement
- Trial Balance (with mapping to financial line items)
These become the starting point for the auditor’s risk assessment.
✔ Provide reconciliations and detailed schedules
Every balance sheet item must have supporting documentation, including:
- Reconciliation statements
- Sub-ledgers for AR, AP, payroll, and assets
- Bank statements or confirmation responses
- Aged receivables/payables reports
- Fixed asset register, physical verification records, and depreciation schedule
- Inventory count reports
- Loan amortization and interest schedules
At Calculate Capitals, we ensure these schedules clearly tie back to the trial balance—reducing auditor queries significantly.
✔ Prepare supporting documents ahead of time
Auditors frequently request:
- Customer and vendor contracts
- Lease agreements
- Tax returns (VAT, Corporate Tax)
- Payroll files
- Board resolutions
- Capex approvals
- Insurance policies
Organizing these upfront avoids repeated follow-ups.
3. Review Key Accounting Policies, Estimates, and Judgments
Audit teams pay extra attention to estimates, assumptions, and policy application. Preparing these areas early reduces scrutiny.
✔ Update your accounting policies
Ensure alignment with:
- IFRS
- UAE VAT regulations
- UAE Corporate Tax requirements
Documenting your policies is a key readiness step.
✔ Prepare evidence for significant estimates
This includes:
- Revenue recognition methodology
- Expected credit loss (ECL) model and assumptions
- Inventory and asset impairment assessments
- Depreciation policies
- Accruals and provisioning logic
As part of our financial review engagements, clients often rely on us to build or validate these models.
4. Conduct an Internal Pre-Audit Review
Before auditors begin fieldwork, a light internal review helps identify and correct issues.
✔ Perform analytical reviews
Compare financials against:
- Previous year
- Budget
- Forecast
Document reasons for unusual movements—Calculate Capitals can prepare these analytical summaries on your behalf.
✔ Check posting accuracy
Look for:
- Misclassified expenses
- Incorrect revenue postings
- Duplicate entries
- Old accruals that should be reversed
Cleaning these entries improves the quality of your year-end numbers.
✔ Validate internal controls
Ensure documented controls—approval workflows, segregation of duties, and authorization levels—are actually being followed.
Auditors will test them.
5. Collaborate Early With Your Auditors
Proactive communication is one of the simplest ways to accelerate your audit.
✔ Schedule a pre-audit planning meeting
Cover:
- Timelines and milestones
- Documentation requirements
- Risk areas
- New transactions or business changes
CFOs who align early experience fewer surprises during fieldwork.
✔ Share documents in auditor-friendly formats
Most audit firms prefer Excel files with formulas intact.
Calculate Capitals often prepares audit-ready Excel packs that reduce back-and-forth significantly.
✔ Assign clear points of contact
Create an internal audit coordination plan—especially if multiple departments contribute data.
6. Complete the Final Pre-Audit Check
In the final days before the audit:
- Reconfirm all reconciliations
- Ensure all tie-outs match the trial balance
- Verify that supporting documents are named and stored logically
- Update financial statements with final adjustments
- Prepare management explanations for key variances
This last review ensures your audit starts on strong footing.
Conclusion: Audit Readiness Is a Strategic Advantage
At Calculate Capitals LLC, we believe that audit readiness is more than a compliance exercise—it’s a reflection of financial control, accuracy, and operational discipline. When month-end closes are tight, reconciliations are complete, and documentation is organized, the audit becomes an opportunity to demonstrate financial strength—not a year-end burden.
