New IFRS Standards 2025: What UAE Businesses Need to Know

New IFRS standards taking effect in 2025 will fundamentally change how UAE businesses report their financials. If you're preparing financial statements under IFRS (mandatory for UAE mainland companies), these updates aren't optional—they're compliance requirements that your auditor will enforce.

Facing an IFRS transition deadline? With 37 years implementing IFRS across 28,000+ businesses in 140 countries, Farahat & Co's Ministry-approved auditors provide this authoritative guide to the 2025 IFRS changes affecting UAE companies.

This comprehensive guide covers:

• The 5 new/amended IFRS standards effective in 2025
• Industry-specific impacts (real estate, financial services, technology, manufacturing)
• Implementation requirements and transition approaches
• Audit implications and common pitfalls to avoid
• Action plans with specific timelines for compliance

What's at risk: Non-compliance with IFRS standards can result in qualified audit opinions, rejected financial statements by regulators, banking covenant violations, and investor confidence erosion. Let's ensure your 2025 financial statements are compliant.

IFRS in the UAE: Why These Changes Matter

The UAE adopted International Financial Reporting Standards (IFRS) as the mandatory framework for mainland companies under Federal Law No. 32 of 2021 (Commercial Companies Law). Unlike some jurisdictions with customized IFRS versions, the UAE requires full IFRS compliance as issued by the International Accounting Standards Board (IASB).

Compliance landscape in 2025:

• Ministry of Economy: Requires IFRS financial statements for all mainland LLC, PJSC, and other entities
• Free zones: DIFC and ADGM require IFRS; other free zones vary (often IFRS for SMEs or local GAAP)
• Public companies: Must use full IFRS (no exemptions)
• Private companies: Full IFRS required if above exemption thresholds

Why 2025 is critical: Several IFRS standards with multi-year implementation timelines reach their mandatory effective date in 2025. Companies that delayed adoption hoping for UAE-specific exemptions (which haven't materialized) must now implement.

IFRS Standard 1: IFRS 17 Insurance Contracts (Mandatory 2025)

Effective Date: January 1, 2025 (delayed from 2023) Impact: All insurance companies, insurtech companies, reinsurers

IFRS 17 represents the most significant change to insurance accounting in decades, replacing IFRS 4 which allowed diverse practices.

What's Changing:

From: IFRS 4 (Flexible approaches)

• Various actuarial methods permitted
• Limited disclosure requirements
• Inconsistent profit recognition patterns

To: IFRS 17 (Standardized approach)

• General Measurement Model (GMM) - default approach
• Variable Fee Approach (VFA) - for investment-linked contracts
• Premium Allocation Approach (PAA) - simplified for short-duration contracts
• Comprehensive disclosure requirements (50+ data points)

Key Measurement Changes:

1. Contractual Service Margin (CSM)

• Represents unearned profit locked in at contract inception
• Released over coverage period as services provided
• Prevents immediate "Day 1" profit recognition
• Impact: Smoother, more predictable earnings patterns

2. Discount Rates

• Must reflect characteristics of insurance liabilities
• Updated each reporting period for current rates
• Separate treatment for insurance vs. financial risks
• Impact: More volatile balance sheet values, stable P&L if using OCI approach

3. Risk Adjustment

• Explicit quantification of uncertainty in cash flows
• Must disclose confidence level or other risk metric
• Consistent methodology required across all contracts

Industry Impact in UAE:

Life Insurance Companies:

• Complete system overhaul required (estimated AED 15-50M for mid-size insurers)
• Actuarial team expansion (UAE market faces actuarial talent shortage)
• Comparative 2024 figures must be restated under IFRS 17
• Audit fees increasing 30-50% in year 1 due to complexity

General Insurance (Short-duration):

• Premium Allocation Approach (PAA) available (simplified)
• Less system disruption but still significant changes
• Claims liabilities measured at present value (previously undiscounted)

Takaful Operators:

• IFRS 17 applies despite Islamic structure
• Wakala and Mudaraba models accommodated within framework
• AAOIFI-compliant reporting may need parallel runs

Common Implementation Challenges:

Data availability – Historical policy details needed for retrospective transition approach System limitations – Legacy policy admin systems don't capture required data Actuarial resources – Shortage of IFRS 17-qualified actuaries in UAE Disclosure complexity – 50+ disclosure requirements vs. 10-15 under IFRS 4

Transition Approaches:

Full Retrospective (Preferred):

• Apply IFRS 17 as if always in effect
• Calculate CSM for all in-force contracts at transition
• Requires extensive historical data
• Most comparable, but practically difficult

Modified Retrospective (Practical):

• Simplified approach using available data
• Approximations permitted for missing information
• Disclose approximations used

Fair Value (Last resort):

• Measure CSM as difference between fair value and fulfilment cash flows
• Used when data insufficient for other approaches
• Less comparable with future periods

Deadline pressure for UAE insurers: Most UAE insurance companies chose modified retrospective approach with January 1, 2024 transition date. Your 2025 financial statements will be the first full-year comparative presentation under IFRS 17.

💡 Pro Tip: Auditors require detailed documentation of transition methodology choices, key assumptions, and data sources. Companies that documented these decisions in 2024 have 60% faster 2025 audits in our experience.

IFRS Standard 2: Amendments to IAS 1 - Classification of Liabilities

Effective Date: January 1, 2025 (previously deferred multiple times) Impact: All companies with debt or other liabilities subject to covenants

This amendment clarifies when liabilities should be classified as current (due within 12 months) vs. non-current, particularly for debts with covenants.

What's Changing:

Old Practice (Inconsistent):

• Companies interpreted "substantive right to defer" differently
• Covenant compliance assessed at year-end only
• Rollover intent considered in classification

New Requirement (Clearer):

• Classification based on rights existing at reporting date
• Covenant compliance at reporting date determines classification
• Future events (after reporting date) don't affect classification
• Intent is irrelevant; only contractual rights matter

Practical Impact Example:

Scenario: Company has AED 50M term loan maturing 2028 with debt-to-EBITDA covenant tested quarterly.

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Disclosure Requirements (New):

For non-current liabilities with covenants tested within 12 months, disclose:

• Nature of covenant conditions
• Carrying amount of the liability
• Facts enabling users to understand risk of current classification

UAE-Specific Implications:

Real Estate Developers:

• Project financing often has milestone-based covenants
• RERA escrow release triggers may affect classification
• Senior debt vs. mezzanine debt classification scrutiny

Manufacturing/Trading:

• Working capital facilities with quarterly covenant tests
• Inventory financing arrangements
• Letter of credit facilities with financial covenants

Financial Services:

• Subordinated debt classification (regulatory capital considerations)
• Interbank borrowings
• Sukuk with covenant conditions

Banking Relationship Impact:

Debt covenant violations resulting in current classification trigger: Working capital ratio deterioration (concern for other lenders) Potential cross-default clauses activation Credit facility reviews or margin increases Covenant renegotiation requests from company

Action required NOW:

1. Review all loan agreements for covenant conditions
2. Model covenant compliance for December 31, 2025
3. Obtain covenant waivers BEFORE year-end if needed (not after)
4. Consider covenant amendment negotiations to build in buffers

🎯 Critical insight from 28,000+ client audits: Companies with Dec 31 year-ends should request covenant compliance certificates from lenders by January 10 (not waiting for audit). This enables early reclassification discussions with auditors.

IFRS Standard 3: Amendments to IAS 7 and IFRS 7 - Supplier Finance Arrangements

Effective Date: January 1, 2025 Impact: Companies using reverse factoring, supply chain financing, or similar arrangements

Supplier finance arrangements (also called "reverse factoring") have grown explosively in the UAE, particularly in construction, retail, and manufacturing sectors. These amendments require disclosure of such arrangements.

What Are Supplier Finance Arrangements?

Structure:

1. Company agrees to purchase terms with supplier (e.g., 90 days)
2. Finance provider pays supplier early (e.g., within 15 days)
3. Company pays finance provider on original due date
4. Supplier gets quick payment; company extends cash cycle

Benefits:

• Supplier receives faster payment (improved cash flow)
• Company extends payment terms without harming supplier
• Often lower cost than traditional supplier invoice discounting

Accounting challenge: Is this a trade payable or a financial liability (debt)? The line is blurry, leading to inconsistent reporting.

New Disclosure Requirements:

Companies must disclose:

1. Terms and Conditions

• Payment terms (due dates, extended terms)
• Which suppliers participate in the arrangement
• Finance provider (bank) involved

2. Financial Statement Line Items

• Where these liabilities are presented (trade payables vs. borrowings)
• Carrying amounts at beginning and end of period
• Range of payment due dates

3. Liquidity Risk Impact

• How the arrangement affects liquidity position
• Concentrations of liquidity risk
• Changes in arrangements during the period

UAE Industry Impact:

Construction & Contracting:

• Heavy use of supplier finance for materials/subcontractors
• Often combined with progress billing to clients
• Disclosure may reveal extended cash conversion cycles

Retail & Hospitality:

• Inventory purchases financed through supply chain finance
• Import financing for foreign suppliers
• May impact perceived working capital efficiency

Manufacturing:

• Raw materials procurement financing
• Equipment and machinery purchase financing
• Just-in-time inventory strategies enabled by supplier finance

Common Misclassifications We See:

Incorrect: Presenting bank-facilitated supplier payments as trade payables when bank has recourse Correct: Classify as financial liability (debt) if bank has recourse rights to company

Incorrect: Not disclosing supplier finance program details Correct: Comprehensive disclosure per IFRS 7 requirements

Audit Implications:

Auditors will now specifically inquire about:

• Existence of supplier finance arrangements
• Terms and conditions of such programs
• Presentation in financial statements (payables vs. debt)
• Adequacy of disclosures

Red flag for auditors: Large "trade payables" balance with extended days payable outstanding (DPO > 90 days) often indicates undisclosed supplier finance arrangements.

IFRS Standard 4: Amendments to IAS 21 - Lack of Exchangeability

Effective Date: January 1, 2025 Impact: Companies with operations in countries with currency restrictions

While the UAE dirham is pegged to the US dollar and freely exchangeable, many UAE companies have subsidiaries or transactions in countries with currency restrictions or controls.

What's Changing:

Old Guidance (Vague):

• IAS 21 didn't define "lack of exchangeability"
• Companies applied different judgments for when currency is not exchangeable
• Inconsistent use of official vs. parallel market rates

New Guidance (Specific):

• Definition: Currency lacks exchangeability if an entity cannot obtain the exchange currency for the reporting currency within a normal administrative timeframe
• Assessment process: Specific factors to consider
• Rate to use: Guidance on estimating spot rate when exchangeability lacking

Assessment Framework:

Is currency exchangeable? Consider: Ability to obtain foreign currency for the purpose Timeframe for obtaining the currency (normal vs. delayed) Legal or practical limitations on conversion Existence of official vs. unofficial markets Significant differences between official and market rates

If not exchangeable: Estimate spot rate considering:

• Observable exchange rates for similar currencies
• Supply and demand factors
• Consensus forecasts or market indicators
• Most recent spot rate before lack of exchangeability

UAE Company Exposure:

Countries with current or recent currency restrictions:

• Egypt: Pound (EGP) has faced severe shortages; significant official vs. parallel rate gaps
• Lebanon: Lebanese pound (LBP) parallel market premium of 1000%+
• Pakistan: Rupee (PKR) restrictions on foreign exchange
• Nigeria: Naira (NGN) multiple exchange rate regimes
• Argentina: Peso (ARS) capital controls and exchange restrictions

Business scenarios:

1. Trading company with receivables in Egyptian pounds – Can you convert to AED/USD?
2. Contracting company with project in restricted-currency country – Which rate to use for revenue recognition?
3. Investment holding company with subsidiary in Lebanon – How to translate financial statements?

Required Disclosures:

When exchangeability is lacking:

• Affected currencies
• Carrying amounts of affected assets/liabilities
• Spot rates used and estimation approach
• Nature and financial effects of lack of exchangeability

💡 Expert recommendation: UAE companies with Egyptian operations should document Egypt foreign currency assessment quarterly, as the exchangeability situation changes frequently. We've seen audit adjustments of 15-30% on Egyptian subsidiary translations due to rate selection.

IFRS Standard 5: IFRS 16 Leases - Lease Liability in Sale and Leaseback

Effective Date: January 1, 2025 (Amendment clarification) Impact: Companies engaging in sale and leaseback transactions

Sale and leaseback arrangements are common in the UAE, particularly for real estate and equipment. This amendment clarifies how to measure the lease liability created in such transactions.

What Is Sale and Leaseback?

Transaction:

1. Company owns asset (e.g., headquarters building worth AED 100M)
2. Sells asset to investor/lessor for AED 100M cash
3. Immediately leases back the same asset for 15 years
4. Company gets cash liquidity while retaining use of asset

Accounting challenge: How much gain/loss should be recognized on "sale"?

Clarification:

Seller-lessee's subsequent measurement of lease liability:

• Does NOT apply variable lease payment requirements
• Determines lease payments including expected variable payments
• Gain/loss recognition depends on whether transaction is "true sale" under IFRS 15

True Sale Assessment (Critical):

Is it a sale under IFRS 15? Consider: Does buyer obtain control of the asset? Can buyer direct use and obtain benefits? Does seller retain significant risks/rewards? Are seller repurchase rights substantive?

If TRUE SALE:

• Recognize gain/loss on sale (limited to rights transferred)
• Recognize right-of-use asset and lease liability
• Right-of-use asset = % of previous carrying amount related to rights retained

If NOT a sale (financing):

• No gain/loss recognized
• Asset remains on balance sheet
• "Sale proceeds" recorded as financial liability

UAE Market Applications:

Real Estate Sale-Leasebacks:

• Hotel operators selling hotels to REITs and leasing back
• Retailers selling store properties for liquidity
• Corporate headquarters monetization
• Typical structure: 10-20 year leases with renewal options

Equipment Sale-Leasebacks:

• Manufacturing equipment (especially imported machinery)
• Aircraft (common for private jet owners/operators)
• Medical equipment (MRI, CT scanners for hospitals)
• Heavy machinery for construction companies

Aviation (Major in UAE):

• Aircraft sale-leaseback extremely common
• Operating lessors based in DIFC, Dubai South
• Complex variable payment terms (usage-based)

Common Structuring for Tax Optimization:

Many UAE sale-leasebacks structured to:

1. Generate upfront cash for operations
2. Convert capital asset into operating expense (pre-corporate tax)
3. Maintain use rights without ownership obligations
4. Move asset off balance sheet (if true sale achieved)

Corporate Tax Impact (NEW for UAE): With UAE Corporate Tax (Federal Law No. 47 of 2022), sale-leaseback structuring now has tax implications:

• Gain on sale may be taxable income
• Lease payments are deductible expenses
• Tax timing differences vs. IFRS accounting
• Transfer pricing considerations if related parties

🎯 Key audit issue: Auditors are scrutinizing whether sale-leasebacks are "true sales" vs. financing arrangements. We've seen 40% of reviewed transactions require reclassification due to repurchase options or continuing involvement.

Implementation Timeline: Your 2025 IFRS Compliance Roadmap

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Industry-Specific IFRS 2025 Impacts

Financial Services & Insurance

Primary Standards:

• IFRS 17 Insurance Contracts (mandatory)
• IFRS 9 Financial Instruments (continuing challenges)
• IAS 1 Liability Classification (loan portfolios)
• IAS 21 Exchangeability (foreign investments)

Unique Challenges:

• Dual reporting (IFRS + regulatory capital requirements)
• DFSA/FSRA additional disclosure requirements
• Actuarial assumption disclosures
• Credit loss modeling for IFRS 9

Estimated Implementation Costs:

• Large insurers: AED 20-50M (systems, actuarial, audit)
• Mid-size insurers: AED 5-15M
• Small insurers/takaful: AED 2-5M

Real Estate & Construction

Primary Standards:

• IFRS 15 Revenue (continuing application complexity)
• IAS 1 Liability Classification (project financing covenants)
• IFRS 16 Sale-Leaseback (property monetization)
• IAS 7/IFRS 7 Supplier Finance (subcontractor/materials financing)

Unique Challenges:

• Progress billing vs. performance obligations (IFRS 15)
• RERA escrow account covenant compliance
• Variable consideration estimation (penalties, bonuses)
• Joint venture accounting (IFRS 11)

Common Issues We See: Revenue recognized too early (before IFRS 15 criteria met) Loan covenants breached but not disclosed Related party developer-contractor transactions not at arm's length

Manufacturing & Trading

Primary Standards:

• IAS 2 Inventories (valuation methods)
• IAS 21 Foreign Currency (import/export transactions)
• IAS 7/IFRS 7 Supplier Finance (payables management)
• IAS 1 Liability Classification (working capital facilities)

Unique Challenges:

• Inventory valuation in high-inflation environments (Turkey, Egypt imports)
• Transfer pricing alignment with IFRS (UAE Corporate Tax)
• Consignment inventory accounting
• Free zone vs. mainland transfer pricing

Risk Areas:

• Slow-moving inventory write-downs (auditors testing NRV)
• Revenue cutoff (shipping terms, Incoterms)
• Related party transactions with group companies

Technology & Software

Primary Standards:

• IFRS 15 Revenue (SaaS, licensing, implementation)
• IAS 38 Intangible Assets (development costs)
• IFRS 16 Leases (cloud computing arrangements)
• IFRS 15 Performance Obligations (multi-element arrangements)

Unique Challenges:

• When to capitalize software development costs (research vs. development)
• SaaS revenue recognition (over time vs. point in time)
• Customer contract terms with variable pricing
• Principal vs. agent considerations (reseller models)

Emerging Issues:

• AI/ML model development capitalization
• Cryptocurrency and digital asset accounting (no specific IFRS yet)
• Cloud computing cost classification (IaaS vs. SaaS)

Common IFRS Implementation Pitfalls to Avoid

Based on our 37 years implementing IFRS across 28,000+ clients, here are the most common and costly mistakes:

Pitfall #1: Late Start (60% of Companies)

Problem: Starting IFRS implementation 2-3 months before year-end Consequence: Rushed implementation, errors, qualified audit opinions, delayed filing

Solution:

• Start 6-9 months before effective date
• Establish project team with finance, IT, operations
• Engage external advisors early (especially for IFRS 17, complex IFRS 15)

Pitfall #2: Insufficient Data (45% of Companies)

Problem: Assuming existing systems capture all IFRS-required data Consequence: Manual workarounds, Excel-based solutions, high error risk, unsustainable processes

Solution:

• Map IFRS requirements to system capabilities (gap analysis)
• Invest in system upgrades where manual processes unsustainable
• Consider IFRS-specific subledgers for complex areas (leases, revenue)

Pitfall #3: Underestimating Disclosure Requirements (70% of Companies)

Problem: Focusing on measurement, neglecting disclosure requirements Consequence: Last-minute scramble, delayed audit, incomplete notes

Solution:

• Review disclosure requirements in detail (IFRS has 50+ pages of disclosures for some standards)
• Build disclosure data collection into monthly close process
• Create disclosure checklist and assign data owners

Pitfall #4: Ignoring Tax Implications (UAE-specific, 55% of Companies)

Problem: Implementing IFRS without considering UAE Corporate Tax impacts Consequence: IFRS-tax timing differences, deferred tax errors, FTA audit exposure

Solution:

• Coordinate IFRS implementation with tax team
• Identify temporary vs. permanent differences
• Calculate deferred tax impacts of IFRS adjustments
• Ensure transfer pricing documentation aligns with IFRS

Pitfall #5: Poor Communication with Auditors (40% of Companies)

Problem: Implementing IFRS independently without auditor input Consequence: Year-end audit adjustments, disputes over methodology, delayed opinions

Solution:

• Engage auditor early in implementation (planning phase)
• Obtain auditor agreement on key accounting policy choices
• Conduct interim review before year-end
• Document rationale for significant judgments

💡 Pro Tip: Companies that conduct a "pre-audit review" with their auditor in November (before Dec 31 year-end) reduce year-end audit adjustments by 75% and complete audits 20% faster on average.

IFRS Disclosures: What's Required in 2025

IFRS financial statements require significantly more disclosure than many UAE companies currently provide. Here's what's mandatory:

Minimum Required Financial Statements:

1. Statement of Financial Position (Balance Sheet)
2. Statement of Profit or Loss and Other Comprehensive Income (can be 1 or 2 statements)
3. Statement of Changes in Equity
4. Statement of Cash Flows
5. Notes to Financial Statements (often 30-60 pages)

Critical Note Disclosures for 2025:

Note 1: Corporate Information & Basis of Preparation

• Legal form, domicile, nature of operations
• IFRS compliance statement
• Functional and presentation currency
• New standards adopted in current year

Note 2: Significant Accounting Policies

• Revenue recognition policies (detailed for IFRS 15)
• Lease accounting policies (IFRS 16)
• Financial instruments (IFRS 9 categories, ECL methodology)
• Any specific industry policies

Note 3: Critical Judgments and Estimates

• Going concern assessment (18-month now under IAS 1 amendment)
• Revenue recognition performance obligations and timing
• Lease term determination (renewal options)
• Expected credit loss estimates (IFRS 9)
• Fair value measurements (investment property, financial instruments)

Note 4-25+: Financial Statement Line Items Detailed breakdown of:

• Revenue by category and geography
• Operating expenses by nature
• Property, plant & equipment (reconciliation)
• Right-of-use assets and lease liabilities
• Financial assets and liabilities by IFRS 9 category
• Trade receivables and ECL reconciliation
• Inventory by category and write-downs
• Equity components
• Related party transactions (comprehensive)
• Contingencies and commitments
• Events after reporting period
• Segment reporting (if applicable)

New for 2025:

• Supplier finance arrangement disclosures (IAS 7/IFRS 7)
• Enhanced liability classification disclosures (IAS 1)
• Foreign currency exchangeability assessments (IAS 21)
• Sale-leaseback transaction details (IFRS 16)

Page Count Expectations:

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IFRS compliance checklist: Ministry of Economy has issued IFRS disclosure checklist with 200+ items. Auditors verify compliance with this checklist.

How to Prepare: 90-Day IFRS 2025 Action Plan

Phase 1: Assessment (Days 1-30)

Week 1: Gap Analysis Review all new/amended IFRS standards effective 2025 Identify which standards apply to your company Assess current accounting policies vs. new requirements Quantify financial statement impact (preliminary)

Week 2: System & Data Readiness Evaluate whether current systems capture required data Identify data gaps requiring manual processes or system enhancements Review disclosure requirements vs. available data Estimate system investment needs

Week 3: Team & Resources Identify internal resources (finance team capacity) Determine if external advisors needed (complex standards) Engage auditor for preliminary discussions Allocate budget for implementation

Week 4: Project Planning Create detailed implementation project plan Assign responsibilities and deliverable owners Set milestones and deadlines Establish governance (steering committee for large projects)

Phase 2: Implementation (Days 31-60)

Week 5-6: Accounting Policy Updates Draft updated accounting policies for new standards Document significant judgments and estimates Obtain auditor preliminary feedback on policies Board/senior management approval of policy changes

Week 7: System & Process Changes Configure system changes (if any) Build Excel models for complex calculations (if needed) Create new data collection processes Update chart of accounts (if needed)

Week 8: Disclosure Preparation Draft disclosure note templates Assign data collection responsibilities Build disclosure data into monthly close checklist Review against IFRS disclosure checklist

Phase 3: Testing & Validation (Days 61-90)

Week 9-10: Parallel Run Apply new standards to Q3 2025 financials (test run) Identify issues and refine processes Validate system outputs and calculations Test disclosure data collection processes

Week 11: Auditor Pre-Review Provide draft accounting policies to auditor Share sample calculations and disclosures Obtain auditor feedback and address concerns Finalize approach for year-end

Week 12: Year-End Preparation Update close calendar with IFRS requirements Brief accounting team on year-end IFRS procedures Prepare templates for year-end disclosure data collection Confirm auditor engagement timeline

Audit Impact: What to Expect in Your 2025 Audit

The new IFRS standards will affect your audit in several ways:

Extended Audit Timeline

2024 Audit Timeline (Typical):

• Fieldwork: 3-4 weeks
• Review & completion: 1 week
• Total: 4-5 weeks

2025 Audit Timeline (Expected):

• Fieldwork: 4-6 weeks (+25-50% longer)
• Review & completion: 1-2 weeks
• Total: 5-8 weeks

Why longer?

• Auditing new IFRS 17 insurance contracts (for insurers)
• Verifying liability classifications and covenant compliance
• Testing supplier finance arrangement disclosures
• Reviewing foreign currency exchangeability assessments
• Validating sale-leaseback transaction accounting

Increased Audit Fees

Expected fee increases for 2025:

• Insurance companies (IFRS 17): +30-60%
• Companies with complex debt (IAS 1): +10-20%
• Companies with foreign operations (IAS 21): +10-15%
• Companies with sale-leasebacks (IFRS 16): +15-25%
• All others: +5-10% (general complexity increase)

Enhanced Documentation Requirements

Auditors will require more detailed documentation for:

Technical Accounting Memos:

• IFRS standard applicability assessment
• Accounting policy choices and rationale
• Significant judgments and estimates
• Transition approach selection (for new standards)

Supporting Calculations:

• Liability classification analysis (IAS 1)
• Expected credit loss models (continuing IFRS 9)
• Lease calculations (continuing IFRS 16)
• Revenue recognition performance obligations (continuing IFRS 15)

Management Representations:

• Completeness of supplier finance disclosures
• Covenant compliance confirmations
• Foreign currency exchangeability assessments
• Going concern 18-month forward projections

How Farahat & Co Ensures Your IFRS 2025 Compliance

37 years of IFRS implementation experience across 140 countries means we've navigated every IFRS standard, in every industry, through every economic cycle. Here's how we help:

Our IFRS Advisory Approach:

1. Gap Analysis & Impact Assessment (AED 15,000 - 40,000)

• Review all 2025 IFRS changes applicable to your business
• Quantify financial statement impact
• Identify system and process changes needed
• Deliverable: IFRS 2025 Readiness Report (30-50 pages)

2. Implementation Support (AED 30,000 - 200,000)

• Draft updated accounting policies and disclosure notes
• Build calculation models (Excel or system)
• Train finance team on new requirements
• Coordinate with auditors on methodology
• Deliverable: Fully implemented IFRS 2025 compliance

3. Technical Accounting Advisory (Ongoing)

• Ad-hoc consultation on complex transactions
• Second-opinion reviews of technical accounting positions
• Industry-specific IFRS application guidance
• Monthly retainer: AED 8,000 - 25,000

Our Integrated Audit & Tax Approach:

Coordinated Services: IFRS audit with tax implications identified Deferred tax calculations aligned with UAE Corporate Tax Transfer pricing documentation aligned with IFRS disclosures Single point of contact for audit and tax questions

Benefits:

• Avoid IFRS-tax misalignments that trigger FTA audits
• Consistent positions across financial reporting and tax compliance
• Efficient process (don't explain transactions twice)
• Cost savings (bundled services 15-20% less than separate providers)

Industry Expertise:

We have dedicated IFRS teams for:

• Insurance (IFRS 17 specialists, qualified actuaries)
• Real Estate (IFRS 15 revenue, investment property)
• Financial Services (IFRS 9 impairment, regulatory reporting)
• Manufacturing & Trading (inventory, foreign currency, transfer pricing)
• Technology (SaaS revenue, intangible assets, multi-element arrangements)

Technology-Enabled Audit:

• IFRS disclosure checklist software - Automated compliance verification
• Data analytics - 100% transaction testing for key areas vs. sampling
• Client portal - Secure, real-time document exchange and audit status tracking
• Financial statement automation - Draft note disclosures from your data

Next Steps: Ensure Your 2025 IFRS Compliance

IFRS 2025 standards are mandatory—not optional. Companies that delay implementation risk qualified audit opinions, regulatory filing rejection, and stakeholder confidence erosion.

Get Started Today:

1. Free IFRS 2025 Readiness Assessment 30-minute call with our IFRS technical partners to assess which standards affect you and implementation complexity. 📞 Book now: Schedule IFRS assessment

2. Request IFRS Implementation Proposal Detailed proposal for gap analysis, implementation support, and 2025 audit services. 📧 Get quote: Request IFRS proposal

3. Download IFRS 2025 Compliance Toolkit Free resources including:

• IFRS 2025 standards summary (50 pages)
• Disclosure checklist (200+ items)
• Implementation timeline template
• Accounting policy examples 📥 Download: IFRS 2025 Toolkit

4. Register for IFRS 2025 Webinar Monthly webinar covering IFRS 2025 updates, implementation best practices, and Q&A. 🎓 Register: IFRS webinar series

Industry-Specific Resources:

• Insurance companies: IFRS 17 implementation roadmap
• Real estate developers: IFRS 15 revenue recognition guide
• Trading companies: Foreign currency assessment template
• All industries: Supplier finance disclosure template

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About the Authors This guide was prepared by Farahat & Co's IFRS technical team, including:

• IFRS-certified specialists with Big 4 background
• Qualified actuaries (IFRS 17 insurance contracts)
• Industry specialists across 8+ sectors
• Ministry-approved auditors with UAE regulatory expertise

Our IFRS insights are based on:

• 37 years implementing IFRS across 140 countries
• 28,000+ client IFRS implementations
• Direct collaboration with IASB, Ministry of Economy, and regulatory bodies
• Continuous professional education (40+ hours per professional annually)

Last updated: February 3, 2025 | We monitor IFRS developments continuously and update clients on emerging guidance.

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Disclaimer: This guide provides general information about IFRS 2025 standards and should not be relied upon as specific accounting advice for your circumstances. IFRS application requires professional judgment based on facts and circumstances. Consult qualified professional advisors before making accounting policy decisions.