Dr Habib Al Mulla, Chairman, Dubai Financial Services Authority (DFSA), addressed a gathering of accountants, bankers, regulators and other finance professionals at the Middle East Accounting Standards and IFRS Summit, organised in Dubai on November 27, 2005.
“The need for unified accounting and reporting standards cannot be over emphasised. When we began the journey of creating the DIFC, we were faced with a number of competing pressures. In an effort to make one of the world’s youngest financial centres a quick success, we could have allowed a multiplicity of international standards. But we resisted that temptation, as we firmly believed that unless we were benchmarked against the highest and best quality international standards, the integrity, efficiency and transparency of the financial centre would not be upheld.”
Companies conducting financial services activities in the DIFC are required to prepare and maintain all financial accounts and statements in accordance with International Financial Reporting Standards (IFRS). Conventional firms, operating an Islamic Window, must maintain all accounts in accordance with the Accounting and Auditing Organisation (AAOIFI), for Islamic financial institutions.
“In the same way that the DFSA requires companies offering securities in the DIFC to report using IFRS or AAOIFI, we also require companies that list their products on the DIFX to prepare accounts that comply with IFRS.
“We believe that the imposition of strong reporting requirements will act as a powerful incentive for firms wishing to access the capital markets of the world to ensure that they prepare high quality accounts in accordance with international benchmarks,” added Al Mulla.
International financial organisations currently licensed by the DIFC include banks such as Credit Suisse, Standard Chartered and Merrill Lynch, asset management firms like Franklin Templeton and Mellon, and insurers like AIG.
About DFSA: Dubai Financial Services Authority (DFSA) is an independent and integrated regulator of all financial and ancillary services undertaken in or from the Dubai International Financial Centre (DIFC) – the regional gateway for capital and investment. Created by statute in September 2004, the DFSA is an autonomous body whose regulatory framework is built to the highest international standards and tailor-made for its environment to ensure that the DIFC is one of the best regulated financial centres in the world.
DFSA’s primary functions include rule making, policy development, authorisation, regulation and enforcement of legislation on institutions and individuals to operate within the DIFC. Using a risk-based framework, the DFSA oversees the full range of financial and ancillary services in the DIFC, including securities and commodities exchange, wholesale banking, asset management, reinsurance, Islamic financial business, legal, accounting and compliance services.
