Theory

Key Terms & Definitions

Financial Statements — Formal IFRS-based reports presenting a company’s financial position and performance, prepared in line with UAE regulations.

Balance Sheet (Statement of Financial Position) — A report showing assets, liabilities, and equity at a specific date, classified into current and non-current items.

Income Statement (Profit & Loss Statement) — A report summarizing income, expenses, and profit or loss over a reporting period.

Corporate Tax Expense — The income statement line reflecting UAE corporate tax (standard rate 9%).

Cost of Goods Sold (COGS) — Direct costs attributable to production or purchase of goods sold, often broken down in disclosures.

Notes to Financial Statements — Detailed explanations supporting figures in the statements, mandatory for UAE audit and tax compliance.

IFRS Compliance — Preparation of financial statements in accordance with International Financial Reporting Standards.