Bookkeeping should create a traceable record of what happened in the business, not merely a year-end total. The records must support management decisions, financial statements and the company’s applicable tax position.
Direct answer
Record every material transaction, reconcile control accounts, retain supporting evidence and close each month consistently. The Federal Tax Authority’s Corporate Tax General Guide explains that records should enable taxable income to be readily ascertained and gives examples including transaction, asset, liability and stock records, bank statements, ledgers, invoices, order records and business correspondence.
Core record groups
- Sales invoices, credit notes, receipts and revenue recognition support
- Supplier bills, purchase orders, expenses and approvals
- Bank, card, cash and payment-gateway statements
- Payroll, employee benefits and end-of-service records
- Fixed assets, depreciation, disposals and financing
- Inventory movement and period-end stock
- Loans, related-party and shareholder balances
- VAT, corporate-tax and other applicable filing evidence
Monthly close sequence
- Collect the complete month’s source documents.
- Post sales, purchases, expenses, payroll and adjustments.
- Reconcile every bank, card, gateway and cash account.
- Review receivables, payables, inventory, assets and liabilities.
- Investigate unusual, missing or unreconciled balances.
- Lock the period after review and issue management reports.
- Store the evidence with access controls and a retention schedule.
Records should agree across systems
The licence name, tax profile, invoices, bank accounts, contracts and accounting ledger should tell one coherent story. Differences may be legitimate, but management should document why and correct stale registrations.
Tax scope must be explicit
Bookkeeping does not automatically include VAT returns, corporate-tax calculations, statutory audit, payroll processing or historic cleanup. A written engagement should state the entities, periods, expected volume, cut-off dates, reports, responsibilities and separately scoped work.
Retention and format
Retention depends on the applicable law and the company’s facts. FTA corporate-tax guidance states that taxable and exempt persons covered by those rules must retain relevant records for at least seven years after the end of the relevant tax period. Other obligations can require different periods, so maintain a governed retention schedule rather than deleting records after one universal date.
How Docman helps
Docman provides scoped accounting and bookkeeping support and coordinates separately agreed tax services. Management remains responsible for complete source information and approval of the records.
Frequently asked questions
Can a UAE SME keep records electronically?
FTA guidance explains that records do not necessarily need to remain in their original format; the retained information must remain complete, accessible and sufficient for verification.
Is bookkeeping the same as filing tax returns?
No. Good books support tax work, but registrations, calculations, returns and advice are separately defined services.
How often should accounts be reconciled?
A monthly close is a practical control for most active SMEs, while higher-volume or higher-risk businesses may need more frequent processing.