If you are a business owner or an entrepreneur in UAE, you may have heard about ICV certificates. But what does it mean? Let me explain.
The ICV certificate is a document that proves the contribution of your business towards the UAE economy. It assesses how much your organization is contributing to the local economy in terms of expenditure, employment and procurement. Some of the companies which deal with government or semi government organizations may require an ICV certificate. Therefore, if you want to get those tender contracts, you need to have this certificate.
What Does ICV Stand For?
ICV means “In-Country Value” and it is a concept that the UAE has adopted to enhance the local economy. This is a concept that UAE has put in place to support the local economy through encouraging the companies to procure supplies from local companies, create job opportunities for the locals and also enhance the local production capabilities.
Getting an ICV certificate is one of the ways that your business can be seen to be supporting the development of the UAE’s economy. It is a good thing for businesses and the economy as it promotes sustainability and long term growth.
Why Do You Need an ICV Audit?
Maybe you are wondering, “Why do I need an ICV audit for my business?” The answer is rather straightforward. ICV audit is the assessment of your company’s in-country value. This score is very important as it is a key factor that determines the chances of being awarded a government or semi-government contract. Here’s how it works:
- The more the ICV score is high, the more you will be having high chances of getting the contract.
- It shows your willingness in supporting the goals and objectives of the UAE’s economy.
- It enhances confidence when dealing with government entities and the local suppliers.
An ICV audit can only be done by approved ICV auditors who will check your financial records to ensure that they are correct and meet the program’s conditions. It is like checking the health of a business to show how it supports the economy of UAE.
How is the ICV Certificate Calculated?
The ICV score is calculated based on several factors, such as:
- Goods and Services Procurement: This looks at how much of the business’s spending is on local suppliers and vendors as opposed to foreign ones. The more local the sourcing, the higher the ICV score that can be achieved, as this indicates a higher impact on the UAE’s economy.
- Local Investment: Any form of investment that is made within the UAE.
- Emiratisation: The number of Emiratis that you have in your employment.
- Exports: Revenue realised from the sales of goods or services that you export.
- Manufacturing Costs: These are costs that are incurred on raw materials, machinery and local production.
- Subcontracting: This is working with local suppliers and contractors.
You get an ICV certificate with your score after the audit. This score is effective for one year from the date of issue and the company has to renew it every year to be able to bid for government contracts.
Who Issues the ICV Certificate?
An ICV certificate is given by approved ICV auditors who are accredited by the UAE’s Ministry of Industry and Advanced Technology (MoIAT). These auditors are the ones that will check your financial statements and records to confirm that they meet all the requirements of the ICV.
This service can only be offered by certified auditors and that is why it is crucial to select a good auditing company. There are many ICV auditors in Dubai and other parts of UAE who can help you to get this certificate.
Why is the ICV Program Important for UAE Businesses?
Have you ever considered how your business affects the economy of your area? The ICV program is meant to help you find the answer to that question. Here’s why it matters:
- Supports Economic Growth: The program encourages businesses to spend locally, which in turn fosters the growth of the UAE economy.
- Creates Job Opportunities: Through the local employment policy the ICV initiative assists in the creation of job opportunities for the citizens of UAE.
- Boosts Local Industries: It supports the localization of supply chain and production base.
- Enhances Competitiveness: Organizations with high ICV rating are often preferred for government procurement deals.
Therefore, through the ICV program your company not only meets government standards but also helps in the advancement of the nation’s objectives.
What Does an ICV Audit Involve?
So, are you stressed about how complex the audit process could be? Relax, it’s not as difficult as it seems if you have the right people to guide you. Here’s what an ICV audit entails as a summary:
- Document Review: The auditors go through your financial statements, payroll records and procurement documents.
- Calculation of ICV Score: Using the information that you have provided, your ICV score is computed.
- Verification: The auditors check all the information to confirm that it is correct and correct.
- Certification: When all is fine, you get your ICV certificate.
It is advisable to ensure that all the documents are ready in advance in order to facilitate the whole process.
How ICV Consultant Can Help You?
Overwhelmed by the process? This is where Farahat & Co comes in. We are one of the top ICV auditors in Dubai and the entire UAE. Here’s how we can aid you:
- Expert Guidance: Our team of certified auditors will guide you step by step for the whole process.
- Accurate Auditing: We will help to ensure that your financial records are in the right condition as expected.
- Hassle-Free Experience: We assist you with document preparation and certification, while you concentrate on your business.
- Customized Solutions: Each company is different, and that is why we offer the services that are suitable for your business.
