What is ICFR?
ICFR refers to the set of internal controls specifically designed to ensure the reliability of an organization’s financial statements and compliance with applicable accounting standards (such as IFRS). Internal Control over Financial Reporting (ICFR) is more than a compliance checklist, it’s the system that ensures your financial data is accurate, complete and reliable.
It ensures that:
A strong ICFR framework is a critical pillar of corporate governance and financial integrity.
Why ICFR Matters in the UAE Context?
In recent years, the UAE has made significant strides in strengthening corporate accountability and investor confidence, making ICFR an essential part of this agenda.
Key UAE Developments:
Even for private companies, a well-designed ICFR framework enhances investment readiness, access to capital, and financial transparency.
How ICFR Differs from Other Controls?
Feature |
ICFR |
Other Internal Controls |
Focus |
Financial reporting accuracy |
Operational efficiency, safety and compliance |
Scope |
Balance sheet, P&L, disclosures |
HR, Procurement, IT Security, etc. |
Oversight |
CFO, Audit Committee, External Auditors |
Department heads, Internal Audit |
Design Standard |
COSO / SOX |
Varies (e.g., ISO, company policy) |
Examples of ICFR in Action
Control |
Description |
Purpose |
Dual Authorization of Journal Entries |
Two-level approval for entries > AED 500,000 |
Prevents unauthorized adjustments |
Monthly Bank Reconciliations |
Compare bank and ledger balances |
Ensures bank balance accuracy |
ERP Access Control |
Restricted posting rights in financial modules |
Prevents unauthorized entries |
Automated Receivables Aging |
Tracks overdue balances |
Supports provisioning accuracy |
How Crowe Can Support Your ICFR Journey
As experts in control design and forensic assurance, we help organizations:
Coming Next Week:
In Week 2, we’ll explore COSO’s 5 components, key financial reporting risks and how to align your control environment with UAE regulatory expectations.
Let’s start strong - your financial statements depend on it.