Manufacturing Accounting & Tax Services in Dubai (UAE)

Our Dubai manufacturing accounting services are designed for businesses across the production and assembly landscape:

• Light Manufacturing & Assembly Operations: Businesses in free zones that import components and assemble finished products for re-export.
• Food & Beverage Production: Companies that need to manage batch costing, track perishable inventory, and comply with food safety regulations.
• Contract Manufacturers: Businesses producing goods on behalf of other brands, requiring precise job costing to ensure each contract is profitable.
• High-Tech Manufacturing: Companies involved in producing electronics or other advanced goods that need to track high-value components and complex bills of materials (BOMs).

From the moment you begin procuring raw materials, specialized manufacturing accounting is necessary. It becomes absolutely critical when:

• You Start Production: You must have a system compliant with IFRS (specifically IAS 2) to track the cost of inventory through its various stages.
• You Need to Price Your Products: To price goods profitably, you must have an accurate Cost of Goods Sold (COGS), which includes direct materials, direct labour, and an allocated portion of factory overheads (like rent and utilities).
• You File Your First Corporate Tax Return: The FTA requires inventory to be valued correctly for calculating taxable profit. Incorrect inventory accounting is a major compliance risk.
• You Need Financing for Equipment: To secure loans for new machinery, banks will require detailed financial statements that accurately reflect the value of your assets and your profitability.

Outsourcing manufacturing accounting provides access to a highly specialized skillset. The costs reflect the complexity of cost and inventory management.

• Small Operations: AED 5,000 - AED 8,000 per month. This typically includes core cost accounting, inventory tracking, and standard financial reporting.
• Medium-Sized Plants: AED 8,000 - AED 15,000+ per month. This service level adds more detailed job costing, variance analysis (standard vs. actual costs), and KPI reporting like inventory turnover.
• Large or Complex Operations: Custom pricing, often including virtual CFO services for supply chain management, capital investment planning, and strategic financial leadership.

The financial risks in manufacturing are directly tied to the management of costs and inventory. Common pitfalls in the UAE include:

• Incorrect Inventory Valuation: Failing to comply with IAS 2 for valuing inventory leads to inaccurate financial statements and can result in significant adjustments and penalties during a tax audit.
• Improper Overhead Allocation: Not correctly allocating factory overheads into the cost of your inventory results in a distorted view of product profitability and non-compliant financial reporting.
• Inaccurate COGS: An incorrect Cost of Goods Sold figure means your gross profit is wrong, leading to flawed business decisions and incorrect Corporate Tax payments.
• VAT on Imported Raw Materials: Incorrectly handling import VAT on raw materials can lead to cash flow problems and compliance issues with the FTA.

Cost accounting is a specific discipline that most general accountants do not specialize in. Hiring an experienced in-house management accountant or financial controller is a significant expense that is often prohibitive for growing manufacturers.

Outsourcing to YourLegal's manufacturing finance partners provides a cost-effective alternative. We bring the expertise to implement a robust cost accounting system for your business, ensuring you can accurately track inventory, calculate a defensible COGS, and comply with UAE tax law. Our detailed reports provide clear visibility into your production costs and product margins, empowering you to make smarter decisions about pricing, efficiency, and investment. This allows you to focus on innovation and production, while we ensure your financial operations are a source of strength and competitive advantage.