All you need to know about getting an ICV Certificate

The In-Country Value (ICV) program, initiated by the Ministry of Industry and Advanced Technology, is an initiative designed to incentivize businesses to procure goods from domestic suppliers and recruit their workforce locally. Under the ICV program, suppliers and businesses in the UAE can demonstrate their competence by obtaining an ICV certificate, which serves as evidence of their dedication to sourcing materials within the Emirates. This certificate holds considerable importance as it enhances eligibility for government tenders and contracts. This article provides a comprehensive understanding of the ICV certificate and its significance, assisting you in preparing and obtaining your ICV certificate in the UAE.

What criteria must a supplier fulfill to get an ICV certificate in the UAE?

The suppliers must fulfill certain requirements before they start the procedure to get their ICV certificate. The ICV certification bodies, like the UAE ICV certificate, can assist you in ensuring that you meet the criteria for applying for the ICV certificate. These conditions are:

• Multiple legal entities of the suppliers must obtain their certificates separately. The MoIAT considers each license a separate entity; hence, a separate ICV certificate must be presented to them.
• A combined ICV certificate gets issued to a company with many branches inside the Emirates, and each branch is involved in a similar activity.
• While filling out the ICV certificate form, the supplier must be double-sure that the figures entered in the form align exactly with the issued financial audits and statements.
• The audited financial statements should be at most two years from the year of certification. This means a supplier seeking ICV certification in Apr 2024 should not present an audited financial statement dated Mar 2022.
• New firms that have registered lately can submit their management accounts for up to 9 months, which can be used for ICV score calculations. However, any management account operating for over nine months must be audited.
• The validity of the ICV certificate Is 14 months from the date when the financial statements were issued. If recertification is needed, and the same financial statements are being used for the ICV issue, then the ICV certificate’s expiry date remains the same.
• Impanelled certifying bodies like ICV Certificate UAE should always be appointed by the businesses to obtain their ICV certificate and scores.
• Under ICV certificate guidelines, suppliers who manufacture goods and finished products are considered manufacturers and must have industrial licenses. Other suppliers who do not hold industrial licenses are considered service providers per the ICV guidelines.

To understand more on your eligibility of an ICV certificate in the UAE, contact ICV experts in the UAE.

Steps to obtain ICV certificate in the UAE

• The MoIAT has directed a simplified and streamlined procedure for ICV certificate applications. The best ICV certificate providers in the UAE must be approached to obtain your ICV certificate. The procedure has been listed below:
• The company must have the financial statements audited and issued as per the IFRS standards.
• Next, the business must fill out the application form for ICV as per the latest guidelines and audited financial statements.
• Lastly, the business can use the certificate per guidelines specified by each applicable authority.

By getting your ICV certificate, you can gain several advantages; these will help you with tender assessments. The certificate that is issued to the suppliers has a score. The score can be improved yearly by understanding what factors contribute to a bigger score. This helps ensure that the supplier stays compliant with the norms if he wants to participate in the tenders. Consulting ICV certification experts in the UAE is always a good idea to ensure that the ICV certificate and the score are good enough for your business to participate in government tenders and contracts.

Tips to improve your ICV score in the UAE

The following are some basic tips to improve your ICV score in the UAE: –

1. Local Sourcing: The percentage of goods and services that you source from local suppliers contributed to an increasing ICV score for your business.
2. Supporting Emiratization: employing and training UAE nationals will enhance the overall ICV score of your company.
3. Investment in the UAE economy by investing in infrastructure and development projects will increase the ICV score.
4. Lastly maintaining compliance with the ICV rules and regulations will further enhance your ICV scores.

The ICV experts in the UAE will help you in improvement if your ICV scores by suggesting the ways in which it can be done.

ICV certificate UAE: your one-stop destination to obtain ICV certificate in the UAE

The ICV certification process requires expert assistance. This is because the audited financial statements issue and the application procedure may sound challenging to laypeople. Therefore, ICV experts at ICV Certificate UAE must be approached for help. The template of the ICV application must be obtained based on the latest audited financial statements. Hence, these key requirements must be met only by experienced ICV consultants. Get in touch with us today and get your business ICV certified. This will ensure your business can participate in all government and semi-government tenders.

Frequently Asked Questions about Getting ICV Certification

1. What documents are needed for ICV Certification?

• Audited financial statements not older than two years in the IFRS format. Companies recently incorporated will need to furnish financials prepared by company management accounts for at least 10 Months of the latest financial year closing.
• ICV Application template duly filled and submitted online.

2. How is the relevant activity classified for an ICV Certification?

Companies with an industrial license will apply for the ICV Certification as a good manufacturer, whereas companies that provide services will be regarded as service providers. While all the attributes for calculating the ICV score remain the same, the goods manufacturer score will be calculated on the manufacturing costs. ICV certification body will consider the service provider cost of third-party services.

3. What is the difference between participating entities and a certifying body?

Under the In-Country Value initiative program, companies that consider ICV Certification and are registered with the Ministry of Industry and Advanced Technology are termed Participating Entities. Companies that provide the ICV certificates by verifying the company’s ICV Application and scrutinizing their financials are certifying bodies. Currently, there are 21 certifying bodies across the UAE. Companies that wish to get certified can request a quotation from any of these approved certifying bodies.

4. Where can I get the financial statements audited as per the ICV Requirement?

Only audit companies certified by the Ministry of Economy can audit the company’s financial statements and provide a licensed audit report. The In-Country Value Certification guidelines have mentioned keeping special cost account codes to accounts related to the expenditure towards the ICV Attributes such as Emiratization Costs, Local Purchases, and Foreign investments. It helps in quickly entering the details on the ICV Template application and, in turn, makes it easier for evaluation by the certifying bodies. Companies must submit all the financials in the IFRS format.

5. Is ICV beneficial for small and medium ( SME) sized companies?

Yes, the ICV Calculation is based on the percentage spent rather than the total amount spent. SMEs do get a chance to participate and win bids from the participating entities. 

6. Is it mandatory to have an ICV Certification?

The UAE government is increasingly planning to outsource most of its operations to the local UAE private sector. While bidding for the same companies with an ICV Certification can get up to 40% leverage in the commercial evaluation. Not certified companies can participate; however, their ICV score will remain ZERO, lowering their chances of winning the bid.

7. Can I use the same certificate every year to participate in the bid?

The ICV certificate is valid only for 14 months. Hence, once certified, the companies must reapply for the same as they would for a company trade license. The changes in the financials result in changes in the ICV Score; hence, companies bid for projects with their recent ICV score.

8. Where can I find affordable audit services and ICV consultation?

Several licensed companies offer audit services. However, it is beneficial to hire a company like Farahat and Co, which has extensive experience advising companies on the potential benefits of acquiring an ICV certification. Farhat and Co. have helped several companies successfully file for their ICV application. Farahat and Co is a pioneer audit firm in Dubai and has branches in other emirates.

9. What if my ICV application contains errors and misrepresenting financial data?

Misrepresented data or manipulation of data is strictly prohibited for the ICV certificate application. A company that has entered wrong financial information or manipulated the financials will need to face a penalty or even disqualification from applying for the ICV certification. 

10. Is the ICV certificate limited to companies in the UAE?

Companies within and outside UAE can both apply for the ICV Certificate. Within UAE, mainland and Free zone companies can apply for the ICV Certificate. 

11. Is there a digital platform for ICV Applications?

The Ministry of Industry and Advanced Technology incorporated an Artificial Intelligence-based platform for the ICV application. From Data entry to providing a seamless and uninterrupted process for ICV certification applicants. The service was recently launched and has helped several companies to benefit from the same. 

Summary

If you have more questions regarding the ICV Certification UAE, contact Farahat & Co today. We have helped several companies find their potential ICV attributes and enabled them to increase their ICV score quickly. Our team of expert auditors is trained to the latest requirements laid by the MoIAT for obtaining the ICV Certification.

Contact us today to find affordable audit services and consultation for your ICV application.