Cost accounting, inventory valuation & fixed assets
Accounting Services for Manufacturing in Dubai
Manufacturing accounting needs proper cost accounting — raw materials, work-in-progress and finished goods each valued correctly — not a simplified trading-company approach that treats inventory as one undifferentiated number.
What's different about manufacturing accounting
Most businesses in this sector rely on the same core services: bookkeeping, VAT return filing, the annual corporate tax return and the statutory audit.
Accounting services built for manufacturing
Accounting for manufacturers and industrial companies
Manufacturers need to know what each product really costs. That means bills of materials, labour and overhead absorption, scrap and yield, and inventory valued consistently across raw materials, work in progress and finished goods. Without a costing system, pricing decisions, bank reporting and the corporate tax return all rest on estimates.
| Product costing | Standard or actual costing with BOMs, labour and overhead absorption |
| Inventory | Raw materials, WIP and finished goods valued under IAS 2 |
| Fixed assets | Plant and machinery registers, depreciation and capital project tracking |
| Variance analysis | Monthly material, labour and overhead variances explained |
| ICV | In-Country Value submissions prepared, with certificates issued through an affiliated MoIAT-approved certifying body |
| Year-end | Audited IFRS statements and corporate tax return |
VAT, customs and corporate tax for manufacturers
Imports of raw materials carry customs duty and import VAT unless an exemption or suspension applies; registered manufacturers account for import VAT through their VAT return. Exports of finished goods can be zero-rated with evidence of export.
Manufacturing and processing of goods are qualifying activities for free zone corporate tax purposes, so free zone manufacturers can achieve 0% on qualifying income if they meet the substance, audit and transfer pricing conditions.
Related services for manufacturers
Related guides from our team
Practical explanations of the rules behind this service, written by our chartered accountants.
Questions from manufacturing owners
What inventory valuation method should a manufacturer use?+
It depends on your production process and how prices move — FIFO and weighted average are both accepted under IFRS; the choice should be consistent and suited to your actual cost flow, not arbitrary.
Do we need a formal fixed asset verification if we already have an audit?+
Physical verification often forms part of the audit scope for asset-heavy manufacturers — we coordinate this as part of the annual audit cycle rather than as a separate exercise.
How is overhead allocated to product cost?+
Typically via an absorption rate based on labour hours, machine hours, or another activity driver relevant to your production process — set up once and applied consistently.
How should manufacturing overheads be included in inventory?+
Under IAS 2, fixed production overheads are absorbed based on normal capacity; abnormal waste and idle capacity are expensed.
Do you issue ICV certificates?+
We prepare and review ICV submissions; certificates are issued through an affiliated MoIAT-approved certifying body.
Is manufacturing a qualifying activity for free zone corporate tax?+
Yes, subject to the other QFZP conditions.
Can you install a costing system?+
Yes, in your existing accounting or ERP system, with monthly variance reporting.
First review is free, within 24 hours.
Running a manufacturing business and tired of generic bookkeeping?
Tell us your current setup and where the reporting breaks down — we'll scope a fixed monthly fee built around how your business actually earns revenue.