Case Study: a UAE-based software company achieves IFRS 15-compliant revenue recognition with HLB HAMT

UAE-based Software Company restates revenue over 8 months with HLB HAMT

A UAE-based software company was incorrectly recognizing annual subscription revenue upfront upon billing, which directly conflicted with the IFRS 15 accounting standard. This practice, audited by HLB HAMT, led to materially overstated revenue and profit, an incomplete balance sheet missing deferred income liabilities, and a higher-than-warranted UAE Corporate Tax exposure.

HLB HAMT conducted a structured review that included contract mapping and revenue deferral recalculations. Their solution reclassified unearned revenue as a deferred income liability and ensured revenue was recognized on a straight-line basis over each subscription term. This resulted in fully restated financial statements that presented a true and fair view, an accurate Corporate Tax liability, and an audit-ready position for the customer.