In continuation of its efforts to raise the effectiveness of financial planning in the country in accordance with international best practices, the Ministry of Finance announced today its success in launching the entities of the first stage of the transformation of the federal government to the basis of accounting entitlement, during the remote work stage during which the ministry demonstrated flexibility and creativity in thinking where Remote application of various technical solutions was made to follow up the development of the federal financial system, the use of visual techniques to hold meetings and remote training for users of the federal financial system, and the inclusion of electronic questionnaires to collect observations related to training and testing sessions to ensure their effectiveness.
The project of the transformation of the federal government into an accrual basis for accounting represents a critical step that raises the efficiency of preparing the federal budget and levels of public financial management in the country. The first phase of the project included the Ministry of Economy, the Ministry of Community Development, the Ministry of State for Federal National Council Affairs, the Federal Tax Authority, the Federal Customs Authority and the Emirates Space Agency.
His Highness Sheikh Hamdan bin Rashid Al Maktoum, Deputy Ruler of Dubai and Minister of Finance, affirmed the UAE government's keenness on proactive and strategic planning for the future by adopting and launching pioneering and innovative projects that support the realization of the vision and guidance of rational leadership in making the UAE the best country in the world by the centenary of its establishment in 2071 at all levels. His Highness indicated that the success in launching the accounting transformation project represents a new step on the path to achieving the goals of the UAE Vision 2021 in providing innovative and advanced infrastructure that enhances the country's leading position in global competitiveness indicators.
His Highness valued the interaction and cooperation of the federal authorities with the Ministry of Finance in preparing for the implementation and launch of this pioneering project, praising these entities' keenness to raise the levels of government work and enhance the efficiency of resource management in accordance with the best international standards followed in this field. His Highness noted that the Ministry of Finance will continue to work with its partners to develop creative and innovative strategic initiatives that reflect the regional and global leadership of the Ministry in the field of managing and developing financial resources in order to achieve comprehensive and sustainable development in the country.
On his part; The Minister of State for Financial Affairs Obaid Hamid Al Tayer indicated that the success in launching the entities of the first stage of the accounting transformation project on an accrual basis, despite the exceptional circumstances the country and the world are witnessing, is the result of the continuous efforts of the work teams in the Ministry of Finance in cooperation with all federal authorities, where The Ministry of Finance has led and directed 36 federal entities during the transformation journey, and has organized interactive sessions and training workshops, in addition to developing and implementing new financial operations based on merit in the federal financial system. Work is still ongoing to launch the second and third groups of the transformation project on an accrual basis on time, according to the approved transformation plan.
Al Tayer said: "The application of the accounting entitlement principle will have direct positive effects on the economy and society in the country in terms of achieving the development and sustainability of the financial system and managing the financial resources of the federal government efficiently and effectively, as well as enhancing the transparency of financial reports in line with the requirements of the International Monetary Fund and global competitiveness standards."
For his part, the Minister of Economy said that the project to develop accounting in the government of the United Arab Emirates, Engineer Sultan bin Saeed Al Mansouri from the monetary basis to accounting on an accrual basis is a very important step in the field of public financial management and would enhance the leadership of the UAE in government, financial and economic performance in line with The best global standards in this regard.
Al-Mansouri added that the Ministry of Economy was within the first stage in implementing the project and launching the new financial system after completing the processes of inventorying assets and balances, training cadres and adopting the required financial reports and analyzes, and began adopting accounting on an accrual basis as of the beginning of this June, assuring His Excellency that the final application of all stages This project at the level of the federal government will have a significant positive impact on the economy and society in the UAE as it will provide a better framework for providing high-quality financial data and will raise the management of government spending to higher levels and will enhance the position of the UAE on many relevant global indicators.
In turn, the Minister of Health and Community Protection, Minister of State for Federal National Council Affairs Abdul Rahman bin Muhammad Al Owais affirmed that the UAE continues to march its excellence and development in all fields and sectors in a manner that enhances its leadership position at the world level, and the project of transforming the federal government to the basis of accounting entitlement comes within the system of excellence In government action, which will lead to the improvement of performance in accordance with the highest international standards, through the application of the best accounting methodologies to develop government financial work and raise the level of performance and efficiency in measuring financial performance.
Al Owais praised the success achieved in launching the first phase of the project, through which the Ministry of State for Federal Council Affairs was chosen to be among the first to implement the project, and His Excellency said: "The specialized teams in the ministry will implement all the requirements, standards and policies of the project in accordance with the highest levels The performance in a way that contributes effectively to improving financial management and providing high-quality financial data to improve the operational performance of the Ministry and contribute to achieving the strategic vision of financial management in the UAE. ”
The Director General of the Federal Tax Authority, Khaled Ali Al-Bustani, said: "The Federal Tax Authority intensified its efforts during the last period in cooperation with the Ministry of Finance to provide the electronic, accounting and financial systems necessary to implement the system of" accounting on merit "smoothly and accurately, as the team of specialists in the Authority participated in the comprehensive program that It was launched by the Ministry to switch from an accounting framework based on a modified cash basis to an accounting framework based on accrual basis in accordance with the accounting standards for eligibility for the Federal Government (FGAAS).
His Excellency added: "Since the establishment of the Authority, it was prepared early to implement the new accounting system and successfully started the actual application of the" accounting based on accrual "system electronically, as of the first of June this year, within the entities that were included in the first stage that the Ministry of Finance has identified to implement the system.
In turn, the Director General of the Federal Customs Authority, Ahmed Abdullah Bin Lahej Al Falasi, valued the role played by the Ministry of Finance in order to enhance the efficiency of the financial system of the Federal Government and the use of advanced tools to support revenues, rationalize expenditures and raise the level of financial supervision, pointing out that the Ministry’s choice of the Federal Customs Authority included The entities that implement the new system in the first stage reflect its confidence in the financial performance of the authority and its ability to implement the system with efficiency and high quality.
Al Falasi clarified that the application of the accounting accrual system helps the Authority to better evaluate its performance in terms of the cost of services, their effectiveness, and their accomplishments, and to give a clearer picture of how successful it is in managing its resources, rationalizing its expenditures, and providing an accurate view of the financial statements for several years, which allows the process of comparison and proper financial analysis.
In details, an integrated financial system was successfully launched to serve the transformation of the accounting accrual basis, through which all transactions, balances and closures are recorded on June 1, 2020, and the opening balances of all federal entities are prepared according to the approved transformation plan, and all transactions, balances and accounts are converted into the accrual principle (revenue, Expenses, liabilities, employee benefits, monthly closings), in addition to preparing the comprehensive asset record for the federal government, continuous training on accounting activities and standards for all federal agencies, setting up accounting policies and guidelines for applying accounting on an accrual basis, training materials for accounting standards for the federal government, and a guide Consolidating the financial statements of the Federal Government, and work is underway to update the approved accounting standards guide.
During the stages of developing and amending the system, the Ministry of Finance held more than 80 dialogue sessions and workshops with all federal agencies to collect requirements, educate and train users, and create 36 detailed forms to help the federal agencies collect the required data. Also, technical solutions were created in the applications of the federal financial system to enable Extracting financial reports containing data of accrual basis and modified cash basis at the same time, in addition to continuous communication with the federal authorities and the concerned users to ensure the effectiveness and appropriateness of the applications and amendments that were developed in the system, and taking into account all proposals submitted to develop the final version of the system.