- Upon review of Federal Act No. 1 of 1972 on the powers of ministries, the powers of ministers, and the laws amending it.
- Federal Act No. 12 of 2014 on the organization of the Office of Auditors and its implementing regulations.
- Cabinet Decree No. 68 of 2020 on the organizational structure of the Ministry of the Economy.
- Cabinet Decree No. 48 of 2022 on the implementing regulation of Federal Law No. 12 of 2014 on the regulation of the profession of auditors.
On the basis of the proposal of the Under-Secretary of State, he decided:
Article (1) – Definitions
In the application of the provisions of this resolution, unless the race to the text otherwise rules, the following words and expressions shall have the meanings ascribed to them:
Ministry of Economy \ Insurance policy: An insurance policy against liability for professional errors of the registered auditor, which registers practitioners of the profession issued by an insurance company licensed in the State.
Insurance coverage: the risks specified in the insurance policy and the insured person with the compensation shown therein.
Annual statement: A statement submitted periodically by the auditor each year from the date of entry, showing the value of the income for the audit activity and related work, as contained in the audited financial statements of the enterprise at the end of the previous financial year.
Act: Federal Act No. 12 of 2014 regulating the profession of auditors
Executive regulation: Cabinet of Ministers Decision No. 48 of 2022 on the implementing regulation of Federal Law No. 12 of 2014 on the regulation of the profession of auditors.
Article (2) – Insurance coverage for the policy
- An auditor whose registration has been accepted in the registers of auditors shall be obliged to submit the insurance policy.
- The insurance policy shall be issued on behalf of the auditor of legal – persons through whom the auditor of natural persons acts.
- Upon the renewal of his registration, a natural person auditor who engages in the profession shall submit a book from the offices, companies, and branches of foreign companies that he works for and is still at the head of his work.
- Insurance coverage includes civil liability for professional errors, damages arising from professional practice, unintentional errors and omissions, including liability arising from employees of auditors from foreign offices, companies and subsidiaries without personal names being mentioned.
- The insurance coverage limit for the first time when a new registration is made for local companies or foreign affiliates shall be 1,000,000 dirhams per year.
- The insurance coverage limit for the first time a new registration of local offices is made shall be an individual enterprise in the amount of 500,000 dirhams per year.
- By the end of the second year of registration, the requirements set forth in this Decision relating to insurance coverage shall be followed. They shall be amended for the third year remaining from the period of registration if the value of the income shown in the annual statement submitted by the end of the second year exceeds the limits of insurance coverage for the document submitted at the beginning of the registration in accordance with the ratios set forth in this Decision.
- On the basis of the annual statement provided for in this Decision, the auditor who is registered with the register of legal person auditors must comply with the insurance coverage as shown in the following table:
|Total annual fees for audit services | Dirham||Ratio of insurance coverage to total annual fees||covering period|
|Up to 20,000,000||100%||One Year|
- The renewal of the registration of the legal person auditor shall not be accepted if the limits of the insurance coverage are lower than those corresponding to the total annual fees shown in the table above.
- In the case of a request for renewal of the registration for more than one year, the limits of the insurance coverage for the policy shall be equal to the value of the income shown in the annual statement attached to the renewal documents. The limits of the insurance coverage shall be adjusted in the following year in the case of an increase in the value of the income shown in the next annual statement on the percentage of insurance coverage issued by the policy.
- For the purpose of achieving the preceding provisions of this article, the auditor, who is registered with the register of auditors of legal persons practicing the profession, shall be obliged to provide the Ministry with a copy of his annual statement.
- Subject to the preceding clause of this article, the aforementioned annual statement shall be confidential in accordance with the professional requirements and standards adopted in that regard.
Article (3) – Insurance coverage period
- The auditor shall keep the insurance policy in force for the duration of the entry into force.
- The auditor must maintain the applicability of the professional error insurance policy with the same last insurance coverage for a period of five years (the period of retention of records and documents prescribed by law) in any of the following cases:
- Withdrawal of any registered auditors of natural persons employed in the profession and working through the foreign office, company, or branch of the foreign company.
- Merge, dissolve or discontinue the company. -Suspend or cancel company constraint.
- The obligations set out in the preceding paragraph shall not apply to an auditor who has not had a client before.
Article (4) – General Provisions
- The auditor of accounts registered in the registers of auditors of natural persons engaged in the profession, upon the renewal of his registration, shall be obliged to submit the insurance policy of the office, company, or branch of the foreign company through which he engages, which shall be effective.
- The auditor who is registered with the register of certified persons engaged in the profession shall be obliged to submit the insurance policy in force for the period of renewal of the required entry, which shall be subject to the documents of the application for renewal of the entry.
- A request for renewal of a record shall not be considered valid unless it is accompanied by an insurance policy in force. The date of completion of the documents for the request for renewal of the record provided for in the implementing regulations of the Law shall be the date of submission of the request for renewal.
- The auditor’s registration in the register of auditors of legal persons practicing the profession shall be suspended if the renewed insurance policy is not submitted within 30 days from the date of expiration of the entry.
- The registration of all auditors in the register of natural persons performing the profession of the auditor in the register of legal persons practicing the profession that has been suspended shall be suspended.
- In the event that any erroneous information and incorrect data is made in the annual statement submitted by the auditor, all partners in the auditor’s register of legal persons practicing the profession or representatives of foreign affiliates shall be referred to the disciplinary board referred to in the law after the necessary investigation by the department of auditors. They shall also be referred to the competent public prosecutor’s office without prejudice to the legal liability of any other persons or to any acts specified in the other legislation in force.
Any provision that contravenes or contradicts the provisions of this Decree shall be repealed.
This decree shall be published in the Official Gazette and shall enter into force from its date of issuance.