UAE Accounting & Tax Glossary

Officers

Officers are individuals who are appointed by a company's board of directors to manage the company's day-to-day operations.

Operating expense

An operating expense, also known as an operating cost, is an expense that a company incurs in the course of its normal business operations.

Operating profit

Operating profit, also known as operating income or earnings before interest and taxes (EBIT), is the profit earned by a company from its core business operations.

Operating profit calculation

To calculate operating profit, you need to subtract the company's operating expenses from its revenue.

Option Pool

An option pool is a portion of a company's equity that is set aside for future employees or other potential equity recipients.

Output VAT

The 5% VAT you charge and collect from customers on taxable sales — which must then be remitted to the FTA.

Outsourced Accounting

Engaging an external accounting firm to handle some or all of a business's financial functions — bookkeeping, VAT filing, payroll, corporate tax, and reporting.

Outsourced CFO

An outsourced CFO is a professional who provides financial management and strategic planning services to a business on a contract basis.

Outsourced Controller

An outsourced controller is a professional who provides financial management and accounting services to a business on a contract basis.

Payback Period

The payback period is a measure of the time it will take for an investment to recover its initial cost.

Payroll

The process of calculating and disbursing employee salaries, allowances, and deductions. In the UAE, payroll must comply with the Wage Protection System (WPS) for mainland employees and must account for end-of-service gratuity accruals.

Payroll records

Payroll records are documents that a company maintains to track the payroll information of its employees.

Finances Glossary

Glossary