Dubai: Bringing in audit committees has “tightened” up the manner in which administration charges gathered from landowners in Dubai are used. So far, there are 27 audit committees that report to the Real Estate Regulatory Agency on how service charges are gathered and sent.
“This reflects our keenness to strengthen the principle of governance and control by using audit firms to audit JOPs (jointly owned properties),” said Marwan Bin Ghalita, who heads RERA. “We are working with our various partners to develop standards and controls that govern audit mechanisms, reach annual budgets with the highest levels of integrity and credibility — especially when it comes to service allowances — and develop financial reports related to the management of a property.”
The audit committees were set up as a feature of Dubai’s revised laws on the management of freehold properties, which became effective in 2019. Every freehold building and local area in Dubai will have its service charges set and regulated by these third-parties.
Look into every detail
The intention was to bring down the control developers or their agents had in the administration of properties post-handover. These are the essential parts of these auditors:
- They are needed to audit financial statements of JOPs to assert whether these are liberated from material misquote. Auditors can remark on whether the information was set up as per the International Financial Reporting Standards (IFRS) just as give a report on the financial statements and the important correspondence under international auditing standards (ISAs).
- The organizations will likewise assess the control guidelines and the danger the executive’s interaction for JOPs, as well as assess the effectiveness of operations, and the sufficiency and dependability of the financial information for properties.
- The firms can guarantee that a property management company agrees with the applicable laws and guidelines in regards to JOPs.
“The signing of such agreements with prominent companies comes within the framework of RERA’s keenness to provide the best auditing services to our customers,” said Mohammed Khalifa bin Hammad, Senior Director of the Real Estate Relations Regulatory Department at RERA.